National Commission on Labour (1967)||
23.61 We have referred earlier to certain weaknesses in the working of the existing industrial relations machinery viz., the delays involved, the expenditure, the largely ad hoc nature of the machinery, and the discretion vested in the Government in the matter of reference of disputes. There have also been allegations of political pressures and interference While many of the allegations may not be true, we cannot be oblivious to the fact that in some cases the decisions of Government. though fair, have not appeared to be so to the aggrieved parties. And this aspect cannot be entirely ignored in training our recommendations. The evidence before us is strongly in support of reforming the industrial relations machinery, so as to make it more effective and more acceptable. What is called for, therefore, is a formal arrangement which is independent in character, expeditious in its functioning and which is equipped to build up the necessary expertise. We consider that it would not be enough to secure some of these improvements through suitable modifications in the existing machinery . A more basic change is called lor, and this can be ensured only through the replacement of the present ad hoc machinery, by permanent machinery, which will be entirely independent of the administration. We. therefore, recommend the setting up of an Industrial Relations Commission (IRC) at the national and State levels, for settling interest disputes, broadly covering matters listed in the Third Schedule to the I.D. Act.1
23.62 The IRC would combine in itself both the conciliation and adjudication functions. We believe that there is a definite advantage in having the conciliation machinery working within the IRC, since both will be concerned with 'interest' disputes though at different stages. An interchange of knowledge, information and expertise can thus be ensured. We have also recommended in an earlier section that all matters concerning recognition of a union as a representative union for purposes of collective bargaining should be
1 For procedure for settlement of disputes in small units or units in which workers are not organised, see para 30.47.
entrusted to an independent authority. We consider that it would he advantageous to entrust this function also to the proposed IRC. It would obviate the need for creating another independent body. In addition to the IRC, we also suggest the setting up of Labour Courts which would be entrusted with the judicial functions of interpretation and enforcement of all labour laws, awards and agreements.
23.63 The set up of the proposed machinery will broadly be on the following lines:
(A) The Industrial Relations Commission (IRC):
(i) There should be a National Industrial Relations Commission appointed by the Central Government for industries for which that Government is the appropriate authority. The National IRG would deal with such disputes which involve questions of national importance or which are likely to affect or interest establishments situated in more than one State, i.e., disputes which are at present dealt with by National Tribunals.
(ii) There should be an Industrial Relations Commission in each State for settlement of disputes for which the State Government is the appropriate authority;
(iii) The National/State IRC will have three main functions: (a) adjudication in industrial disputes, (b) conciliation and (c) certification of unions as representative unions.
(iv) The strength of the National/State Commission should be decided taking into account the possible load on it and the need for expeditious disposal of cases; its membership should not exceed seven.
(v) The Commission should be constituted with a person having prescribed judicial qualifications and experience as its President and equal number of judicial and non-judicial members; the non-judicial members need not have qualifications to hold judicial posts, but should be otherwise eminent in the field of industry, labour or management;
(vi) Judicial Members of the National Indus ~ trial Relations Commission, including its President, should be appointed from among persons who are eligible for appointment as Judges of a High Court;
(vii) The terms and conditions of service and the age of superannuation of the judicial members of the National/State IRC should be similar to those of the judges of the High Courts.
(viii) The President of the National Industrial Relations Commission will be appointed by the Union Government in consultation with a committee consisting of the Chief Justice of India, the Chairman of the Union Public Service Commission (UPSC) and the senior most Chief Justice in the High Court
(ix) The other members of the National Industrial Relations Commission will be appointed by the Union Government in consultation with the Chief Justice of India, the Chairman of the U.P.S.C and the President of the National Industrial Relations Commission;
(x) In regard to the State Industrial Relations Commission, the President of a State IRC will be appointed by the State Government in consultation with the Chief Justice of India, the Chief Justice of the State and the Chairman of the State Public Service Commission;
(xi) The other members (of a State Industrial Relations Commission will he appointed by the State Government in consultation with the Chief Justice of the State High Court, the Chairman of the State Public Service Commission and the President of the State Industrial Relations Commission;
(xii) The Conciliation Wing of the Commission will consist of conciliation officers with the prescribed qualifications and status. In the cadre of conciliators, there will be persons with or without judicial qualifications. Those who have judicial qualification would be eligible for appointment as judicial members of the Commission after they acquire the necessary experience and expertise. Others could aspire for membership in the non-judicial wing;
(xiii) The Commission may provide arbitrators from amongst, its members/officers, in case parties agree to avail of such services;
(xiv) The Commission may permit its members to serve as Chairmen of the Central/ Stale Wage Boards/Committees if chosen by the Government. for such appointment
(xv) The functions relating to certification of unions as representative unions will vest with a separate wing of the National State IRC. The National IRC may, where it considers necessary, get the following of the contending unions determined by the State IRCs.
23.64 The procedure for the settlement of disputes would be as follows:
(i) After negotiations have failed and before notice of strike /lock-out is served, the parties may agree to voluntary arbitration and the Commission will help the parties in choosing an arbitrator mutually acceptable to them.
(ii) After negotiations have failed and notice of strike/lock-out has been served, cither party may approach the Commission for naming a conciliator within the Coin-mission to help them in arriving at a settlement during the period covered by the said notice.
(iii) In essential industries/services, when collective bargaining fails and when the parties to the dispute do not agree to arbitration, either party shall notify the IRC, with a copy to the appropriate Government, of the failure of such negotiations, whereupon the IRC shall adjudicate upon the dispute and its award shall be final and binding upon the parties.
(iv)1 In the case of "Others" (non-essential industries/'services), following the failure of negotiations and refusal by the parties to avail of voluntary arbitration, the IRC, after the receipt of notice of direct action (but during the notice period), may offer to the parties its good offices for settlement. After the expiry of the notice period, if no settlement is reached, the parties with be free to resort to direct action. If direct action continues for 50 days. it will be incumbent on the IRC to intervene and arrange for settlement of the dispute.'
(v)1 When a strike or lock-out commences, the appropriate Government may move the Commission to call for the termination of the strike/lock-out on tile ground that its continuance may affect the security of the State, national economy or public order, and if after hearing the Government and the parties concerned the Commission is so satisfied, it may for reasons to be recorded call on the parties to terminate the strike/lock-out and file their statements before it. Thereupon the Commission shall adjudi-cate on the dispute.1
(vi) (a) If a State IRC. is seized of any dispute and it appears to the Central Government that the decision on the said dispute is likely to have an impact on similar industrial undertakings in other States, it will be open to the Central Government to move the National IRC; to take the said dispute on its file. When such an application is made the National IRC shall hear the parties concerned, and if it comes to the conclusion that it is necessary to take the case on its file. it shall call for the papers in relation to the said dispute from the State TRC and shall proceed to deal with and decide the dispute.
(b) Similarly if a State IRC is seized of any dispute and it appears to the National IRC that the decision on the dispute is likely to have an impact on similar industrial undertakings in other States, and if after hearing the parties the National IRC comes to the conclusion that it is necessary to take the case on its file, it will be open to the National IRC to call for the papers in relation to the said dispute from the State IRC and decide the dispute on merits.
(vii) When a State IRC is possessed of any dispute, and during the hearing it comes to the conclusion that the decision on the said dispute will have an impact on similar industrial undertakings in other States and that it is desirable that the dispute should be tried by the National IRC, it may, after hearing the parties concerned transmit the case to the National IRC which with thereupon try the said dispute.
(viii) Where a dispute is brought before the National IRC, and the Commission after hearing the parties comes to the conclusion that it may be desirable or expedient that the said dispute should be dealt with by the appropriate State IRC it may remit the case to the said State IRC for disposal and on receiving the record of the said dispute, the State IRC shall proceed to deal with it.
1 Shri Vasavada, Shri Ramanujam and Shri Malviya do not agree for reasons explained in their Minute of Dissent
(ix) If the Commission substantially grants the demands in support of which the strike was called and comes to the conclusion that the said strike was justified because of the refusal of the employer to grant the said demands, the Commission while making its award may direct the employer to pay the employees their wages during the strike period.
(x) In case a strike becomes necessary as a result of the changes sought to be introduced by the employer in the terms and conditions of employment of his employees and the Commission comes to the conclusion that the change(s) was/ were not justified and the strike was justified, the employees with be entitled to wages for the period of strike.
(xi) If the demands in support of which the strike was called are not granted by the Commission and it holds that the strike was unjustified, wages for the period of the strike with not be granted.
(xii) If the Commission holds that demands which led to the lock-out were justified and the lock-out was not justified, the Commission in granting the demands may order that the employees should be paid their wages during the period of the lock-out.
(xiii) If the Commission holds that the demands were not justified and the lockout was justified the employees will not he entitled to claim wages for the period of the lock-out.
(xiv) If during the pendency of the strike or thereafter, the employer dismisses or discharges an employee because he has taken part in such strike, it would amount to unfair labour practice' and on proof of such practice, the employee will be entitled to reinstatement with back wages.
(xv) All collective agreements should he registered with the IRC.
(xvi) An award made by the IRC in respect of a dispute raised by the recognised union should be binding on all workers in the establishments) and the employer(s).
(B) Labour Courts
23.65 In addition to the Industrial Relations Commission, we also suggest the setting up of standing Labour Courts which would be entrusted with judicial functions of interpretation and enforcement of all labour laws, awards and agreements These courts with deal broadly with disputes relating to matters mentioned in the Second Schedule of the ID. Act, in respect of the industrial relations issues brought to them.
(i) There will be a labour court in each State constituted of judicial members only. The strength and location of such courts will be decided by the appropriate Government;
(ii) Members of the labour court will be appointed by Government on the recommendations of the High Court. Generally, the Government should be able to choose from a panel given by the High Court in the order in which the names are recommended;
(iii) Labour courts will deal with disputes relating to rights and obligations, interpretation and implementation of awards of either the National or State IRC and claims arising out of rights and obligations under the relevant provisions of laws or agreements, as well as disputes in regard to unfair labour practices and the like.
(iv) Labour courts will thus be the courts where all disputes specified in clause (iii) will be tried and their decisions implemented. Proceedings instituted by parties asking for the enforcement of rights falling under the aforesaid categories will be entertained by labour courts which will act in their execution jurisdiction in that behalf. Appropriate powers enabling them to execute such claims should be conferred on them
(v) Appeals over the decisions of the labour court in certain clearly defined matters, may lie with the High Court within whose area/jurisdiction the court is located;