Industrial Employment Act
Industrial Employment Act
Industrial Employment Act
Earlier the economic law of demand and supply in the labour market setteled mutally
benefi- cial bargain between the employer and the workman. It was taken as granted that such a
bargain would secure fair terms and conditions of employment to the workmen. They had a biding
faith in the
inity of this law. But the working of this law has belied their faith. Later workman found that they did
not possess adequate bargaining strength to secure fair terms and conditions of service, they
organised themselves in trade unions and insisted on collective bargaining with the employer. The
advent of trade unions and collective bargaining created new problems for maintaining industrial
peace and production for the society. Workmen started putting forth their damands. Recognising
the rough deal that was being given to the workers by employers who would not define their
conditions of service and the inevitability of industrial strife in such a situation, the legislature
made an attempt to intervene by introducing the Industrial Employmant (Standing Orders) Bill,
1946.
Experience has shown that ‘standing orders’ defining the conditions of recruitment, dis-
charge, disciplinaryaction, holidays, leave, etc., go a long way towards minimising friction
between the managment and workers in industrial undertakings. Discussion on the subject at the
tripartite Indian labour Conference revealed a concensus of opinion in favour of ‘standing orders’
in all indus- trial establishment one hundered or more workers.
In the first instance, the Act will apply to the categories of industrial establishments
speci- fied in clause (2) (e), which include, besides factories and railways, mines, quarries and oil
fields, tramway or motor, omnibus services, docks, wharves and jetties, inland steam vessels,
plantations and workshops. Goverment will be competent to extend the Act to other classes of
industrial estab- lishments or to grant exemptions where necessary, by notifications.
Within 6 months from the date on which the Act becomes applicable to an industrial
estab- lishment the employer is required to frame draf ‘ standing orders’ and submit them to
thecertifying Officer for certification. the draft should cover all the matters specified in the
Schedule to nthe Act and any other matter that Goverment may prescribe by rules. The Certifying
Officer will be empow- ered to modify or add to the draft standing orders so as to render them
certifiable under the Act. It will not be his function (nor of the Appellate Authority) to adjudicate
uiponm their fairness or reasonable- ness. There will be a right to appeal against the decisions of
the Certifying Officers.
ACT 20 OF 1946
The Industrial Employment (Standing Orders) Bill, 1946 was passed by the legislature
and it received the assent on 23rd April, 1946. It came on the statue book as the Industrial
Employment (Standing Orders) Act, 1946 (20 of 1946).
LIST OF AMENDING ACT AND ADAPTATION ORDERS
COMMENTS
(i) Once the Industrial Employment ( Standing Orders ) Act becomes applicable to an
estab- lishment, it does not cease to apply on account of subsequent fall in the number of the
workmen in the establishment ; Balakrishna pillali v. Anand Engineering works (P) Ltd., (1974) II
LLN 199 (Bom).
.
1. For Statement of Objects and Reasons, see Gazette of India, 1946. Pt. V, pp. 179 and 180.
The Act has been extended to Gao, daman and Diu by Reg. 12 of 1962, sec. 3 and Sch., to Pondicherry (w.e.f. 1-10-1963), by reg. 7 of 1963, sec.3
and Sch. I and to Lacadive Minicoy and Amin Divi Islands (w.e.f. 1-10-1967) by reg. 8 of 1965, sec. 3 and Sch.
2. Subs. by the A.O. 1950, for “ all the Provinces of India”.
3. The words “ except the State of Jammu and Kashmir” omitted by Act 51 of 1970, sc. 2 and Sch. (w.e.f. 1-9-1971).
4. Subs. by Act 16 of 1961, sec. 2 for sub- section (3).
Second proviso omitted by Act 39 of 1963, sec. 2 (w.e.f. 23-12-1963).
6. Ins. by Act 39 of 1963, sec. 2(w.e.f. 23-12-1963).
(ii) The Industrial Employment (Standing Orders) Act, 1946 contains a enral provision
requiring employers in the industrial establishments to define terms and conditions of the employ-
ment under them and to make such terms and conditions known to the workmen employed by
them, from the very begining; Narendra pal Galot v. State of Uttar pradesh, (1994) LLR 21 (All).
(iii) Any order may be questioned under article 226 of the Constitution of India if teh
Certi- fied Standing Orders are illegal, and violative of the principles of natural justice; Narendra
Pal Gahlot v. state of Uttar Pradesh, (1994) LLR 21 (All).
(iii) The certified standing orders when come in the force will be binding to the existing as
well as those employees who are appointed subsequently; Hyderabad Allwyn Ltd. Co. v. Addl.
Industrial Tribunal -cum-labour Court;
(1990) 76 FJR 139 (AP).
2. Interpretation.- In this Act, unless there is anything repugnant in the subject or context,-
1[ (a) “ appellate authority” means an authority appointed by the appropriate Govermernt
by
notification in the functipons of an applellate authority under this Act:
Provided that in the relation to an appeal pending before an Industrial Court or other
Authority immediately before the commencement of the Industrial Employment (Standing Orders)
Amendment Act, 1963 (39 of the 1963), that court or authority shall be deemed to be the appelate
authority;]
(b) “ appropriate Goverment” means in respect of Industrial establishments under the
control of the Central Goverment, that Government may , either on a reference made to it by the
employer or the workman or a trade union or other representative body of teh workmen, or on
its own after giving the parties an opportunity of being heard, decide the question and such
decision shall be final and binding on the parties;]
(i) in a factory, any person named under 5[clause (f) of sub-section (1)
of section 7, of the Factories Act, 1948 (63 of 1948 )], as manager of the factory;
(ii) in any industrial establishment under the control of any department
(h) “ trade union” means a trade union for the time being registered under the Indian
Trade Unions act, 1926 (16 of 1926) ;
[(i) “ wages” and “workman’ have the meanings respectively assigned to them in clauses
2
(rr)and (s) of section 2 of the Industrial Disputes Act, 1947 (14 of 1947)].
COMMENTS
(i) Workmen of an industrial establishmnet , where “ appropriate Government” is the
Central Goverment, will be governed by the Model Standing Orders of the Central Goverment till
its own standing orders are certified and come into the opperation in accordance with the Act;
Bhim Sain Prabhakar v. Chaturvedi, (1990) 1 LLN 591 (P&H).
(ii) Contractual sipulation in the letter of appointment control override the provisions
of the statute. The latter shall have theoverridding effect; Bhim Sain Prabhakar v. Chaturvedi,
(1990) 1 LLN 591 (P&H).
3. Submiossion of draft standing orders.- (1) Within six months from the date on which
this Act becomes applicabnle to an industrial establishmnet, the employer shall submit to the
certifying officer five copies of the draft standing orders proposed by him for adoption in his
industrial establishmnet.
(2) Provision shall be made insuch draft for every matter set out in the Schedule which
may be applicable to the industrial establishmnet, and where model standing orders have been
prescribed, shall be, so far as is pra cticable, in confirmity with such model.
(3) The draft standing orders submitted under this section shall be accompanied by
a statement giving prescribed particulars of theworkmen employed in the industrial
establishmnet including the name of the trade union, if any, to which they belong.
COMMENTS
(i) The words “any standing order” would include “ Model Standing Orders”,
proposed standing orders” and the proposed modification to the already certified standing orders’;
Indian Oil Corporation Ltd. v. Joint Cheif Labour Commissione, (1990) 76 FJR 93 (Del)
(ii ) A duty is cast on the Certifying Officer to see that the draft standing orders or the
modification thereof not only should conform with the Model Standing Orders but also he ha sto see
to adjudicate whether the same is reasonable or fair, Indian Oil corporation Ltd.v. Joint Cheif Labour
Commissione, (1990) 76 FJR 93 (Del).
5. Certification of standing orders.- (1) On receipt of the draft under section 3, the
Certify- ing Officer shall forword a copy thereof to the trade union, if any, of the workme, or where
there is no such trade union, to the workmen in such manner as may be prescribed, together with a
notice in the prescribed from requiring objections, if any, which the workmen may desire to make
the draft standing orders tobe submitted to him with infifteen days from the receipt of the notice.
(2) After giving the emplpoyer and the trade union or such other representatives of the
workmen as may be prescribed,an opportunity of being heard, the Certifying Officer shall decide
whether or not any modification of or addition to the draft submitted by the employer is
neccessary to render the draft standing orderscertifiable under this Act, and shall make an order in
writing accordingly.
(3) The Certifying Officer shall thereupon certify the draft standing orders, after making
any modifications therein which his order under sub-section (2) may require, and shall with in
seven days thereafter send copies of the certified standing orders authenticated in the prescribed
manner and of his order under sub-section (2) to the employer and to the trade union or other
prescribed representatives of the workmen.
COMMENTS
(i) when the settlement was arrived at between the workmen and the company and which
is still in force, the parties are to remain bound by the terms of that settelment. till the settelmet is
terminated, Certified Standing Orders can n ot be allowed to be amended; Barauni Refinery
Pragatishil Sharmik Parishad v. Officer shall Indian Oil Corporation Ltd. (1990) 76 FJR 93 (Del).
(ii) The certified standing orders have the overriding effect on other service rules or
regula- tions; S. Alamelu v. The Superitending Engineer, South Arcot Electercity System, 1990
LLR 457 (Mad).
1. subs. by Act 36 of 1956, sec.32, for “shall not be thefunction” (w.e.f. 17-9-1956).
2 Subs. by Act 18 of 1982,sec.2 (w.e.f. 17-5-1982).
6. Appeals .- (1) 2[ Any employer, workmen, trade union or other prescribed representatives of the
workmen] aggrieved by the order of the Certifying Officer under sub-section(2) of section may ,
within 1 [thirty days] from the date on which copies are sent under sub-section (3) of that section,
appeal to the appellate authority, and the appellate authorit, whose decision shall be final, shall by
order inwriting confirm the standing orders either in the form certified by the Certifying Officer
or after amending the said standing order by making such modification thereof or additions
thereto as it thinks neccessary to render the standing orders certifiable under this Act.
(2) The appeliate authority shall, with in seven days of its order under sub-section
(1), send copies thereof the Certifying Officer, to the employer and to the trade union or other
prescribed repersantatives of the workmen, accompanied, unless it has confirmed without amend-
ment the standing orders as certified by the Certifying Officer, by copies of the styanding orders
as certified by it and authenticated in the prescribed manner.
7. Date of operation of standing orders.- Standing orders shall, unless an appeal is
preferred under section 6, come in to opreation on the expiry of thirty days from the date on which
authenticated copies thereof are sent under sub-section (3 of section 5, or where an appeal as
aforesaid is perferred, on the expiry of seven days from the date on which copies of the order of
the appelate authority are sent under sub-section (2) of section 6.
8. Register of standing orders.- A copy of all standing orders as finally certified under
this Act shall be bfiled by the Certifying Officer in a register in the prescribed form maintained for
the purpose, and the Certifying Officer shal furnish a copy thereof on payment of teh prescribed
fee.
9. posting of standing orders.- The text of the standing orders as finally certified under
this Act shalll be prominently posted by the employer in English and in the language understood
by the majority of his workmen on special boards to be maintained for the purpose at or near the
entrance through which the majority of the workmen enter the industrial establishment and in all
departments thereof where the workmen are employed.
10. Duration and modification of standing orders.- (1) Standing orders finally certified
under this Act shall not, except on agreement between the employer and the workmen, 2 [ or a
trade union or other representative body of the workmen] be liable to modification untill the
expiry of six months from the date on which the standing orders or the last modifications thereof
came in operation.
3
[(2) Subject to the provisions of sub-section (1), an employer or workman 2[ or a trade
union or other repersentative body of the workmen] may apply to the Certifying Officer to have
the standing orders modified and such application shall be accopmpanied by five copies of 4[ * *
*] the modification are proposed to be made by agreement between the employer and the
workmen 2[ or a trade union and other repersentative body of the workmen] a certified copy of that
agreement shall be filed with the application. ]
(a) at the rate of fifty percent. of the wages which the workman was entitled to
immedi- ately preceding the dateof such suspension; for the first ninety days of suspension ; and
(b) at the rate of seventy-five percent.of such wages for the remaining period of suspen-
sion if the delay in the completion of displinary proceedings against such workman is not directly
attributable to the conduct of such workman.
(2) If any dispute arises regarding the subsistence allowances payable to a workman under
sub-section (1) the workman or the employer concerened may refer the dispute to the labour
court, consituted under the Industrial Disputes Act, 1947(14 of 1947), within the local limits of
whose jurisdiction the industrial establishment wherein such workman is employed is situate and
the Labour Court to which the dispute is so reffered shall, after giving the parties an opportunities
of being heard, decide the dispute and such decision shall be fianl and bind ing the parties.
(3) Notwithstanding anything contained in the foregoing provisions of this section
where provisions relating to payment of subsitence allowance under any other law for the time
being in force in any State are more beneficial than the propvisions of this section, the
provisions of such other law shall be applicable to the payment of subsistence allowance in the
State.]
COMMENTS
(i) Subsistence allowance paid during the period of suspension can not be recovered;
R. Govendraj v. Goverment Tool Room training Centre, (1990) 1 CLR 442 (Karn).
(ii) Once the amendments have been certified, the certified standing orders operate.
How- ever, they are law made under the provisions of the Act; May & Baker Ltd. v. Shri Kishore
Jai Kishandas Ichaporia, (1991) 63 FLR 319(Bom).
11. Certifying Officers and appellate authorities to have powers of civil
court- 3[(1) Every Certifying Officer and appellate authority shall have all the powers of a civil
court for the purposes of receiving evidence, administering oaths, enforcing the attendance of
witnesses, and complening the discovery and production of documents, and shall be deemed to be
a civil court with in the meaning of 4[ sections 345 and 346 of the Code of Criminal procedure,
1973 (2 of 1974).]
3[(2) Clerical or airthmetical mistakes in any order passed by a Certifying Officer or
THE SCHEDULE
[ See sections 2(g) and 3 (2)]
MATTERS TO BE PROVIDED IN STANDING ORDER UNDER THIS ACT
1. Classification of workmen, e.g., whether permanent, temporary, apprentices,
probatiooners, or badlis.
2. Manner of intimating to workmen periods and hours of work, holidays, pay-days
and wage rates.
3. Shift working.
4. Attendance and late coming.
5. Conditions of, procedure in applying for, and the authority which may grant, leave
and holidays.
6. Requirement to enter premises by certain gates,and liability to search.
7. Closing and re-opening of sections of the industrial establishment, and temporary
stop- pages of work and the rights and liabilities of the employer and workmen arising
thereform.
8. Termination of employment, and the notice thereof to be given by employer and
work- men.
9. Suspension or dismissal for misconduct, and acts or omissions which constitute miscon-
duct.
10. Means of redress for workmen against unfair treatment or wrongful exactions by
the employer or his agents or servants.
11. Any other matter which may be prescribed.