Introduction
The Industrial Disputes Act, 1947, was enacted with the main object to provide machinery for the investigation and settlement of disputes arising between the employer and workmen working in an “industry” as defined in the Act. Therefore, the definition of “industrial dispute” holds a special significance as it delineates the very scope of conflicts that the Act aims to address. This article undertakes a comprehensive analysis of Section 2(k) of the Act, examining its constituent elements, the nature of a valid dispute, the essential requirement of community of interest, and key judicial interpretations that have shaped its application.
Statutory Definition of ‘Industrial Dispute’
Section 2(k) of the Industrial Disputes Act, 1947 defines ‘Industrial Dispute’ as: “Any dispute or difference between employers and employers or between employers and workmen or between workmen and workmen which is connected with the employment or non-employment or the terms of employment or with the conditions of labour of any person.”
The definition appears to be comprehensive and wide enough to include all disputes or differences between employers and employees, or employers and workmen, or workmen and workmen for employment and non-employment, or terms of employment or conditions of labour of a person. The Industrial Dispute must have:
Factum or a real and substantial dispute: There must be an actual ‘dispute or difference’ that is real and substantial, possessing an element of persistency and continuity until resolved. Such a dispute, if not resolved, can endanger the industrial peace of the undertaking or the community, as held in the case of Shambhunath v Bank of Baroda AIR 1978 SC 1088.
Any difference between employer and employees that gives rise to the occasion to move the machinery for resolving the difference is covered by the definition of industrial dispute. Justification or otherwise of the controversy is a secondary consideration as the difference may arise when a demand is made which may not be considered justified or may be considered wholly unjustified by the employer. Nevertheless, the machinery was put into action to resolve the controversy in the case of Safdarjang Hospital v K.S. Sethi AIR 1970 SC 1407.
Parties to the Dispute: The dispute must arise between specific parties:
- Employers and employees.
- Employers and workmen.
- Workmen and workmen.
Industrial Disputes Act does not require that a dispute, to be classified as an ‘industrial dispute’, should be raised by a recognized union or a majority union. Only requirement of an industrial dispute is that there should be a dispute between the employer on one side and the workmen on the other side, or amongst the workmen or employers themselves. Accordingly, in the case of Bharat Sanchar Nigam Ltd v Industrial Tribunal, 2000 LLR 742 (Ker.), it was not necessary that the sponsoring union be a registered trade union or a recognized trade union.
Subject Matter of the Dispute: The dispute must be connected with:
- Employment.
- Non-employment.
- Terms of employment.
- Conditions of labour of ‘any person’.
The industrial dispute may relate to wages, bonus, dearness allowance, etc., or to any matter connected with the terms and conditions of employment of the workers or on some general questions on which each group is bound together by a community of interest as held in the case of D.N. Banerji v P.R. Mukherjee AIR 1953 SC 58.
Essential Elements of an Industrial Dispute
A dispute to be classified as an Industrial Dispute under the Industrial Disputes Act, 1947 must have such essential elements:
- Demand and Rejection:
For a dispute to be classified as an industrial dispute, a demand must first be raised on management and rejected by it. Where the demand is raised for the first time before the Conciliation Officer, and he, in turn, communicated to the management, which rejected the same was held not sufficient to constitute an industrial dispute within the meaning of the Act in the case of Fedders Lloyd Corpn. Ltd v Lt. Governor, Delhi AIR 1970 Del 60. Written demand is not necessary for bringing into existence an ‘industrial dispute’. - Persistence of Dispute:
An industrial dispute typically relates to a running concern or industry. However, disputes do not necessarily cease to exist if the industry is closed down on the date the cause of action arises, or upon the death of the concerned workman. An industrial dispute will subsist despite the closure or takeover of an industry. For instance, if a dispute concerns a claim for bonus for past work, the tribunal retains the duty to complete adjudication and make an award as per U.P. Electric Supply Co. Ltd v Workmen (1971). - Community of Interest:
For an industrial dispute, there must exist some community of interest. Normally, workmen will not raise a dispute in which they are not directly or substantially interested. Only a collective dispute could constitute an industrial dispute.
In a case where the party to the dispute is composed of aggrieved workmen themselves and the subject matter of dispute relates to them, or any of them, they have a direct interest in the dispute. Where, however, the party to the dispute is also composed of or represents the cause of another person whose employment or non-employment, etc., may prejudicially affect their interest, the workmen are said to have a community interest in the subject matter of dispute. In both cases, the dispute is an industrial dispute.
Case Analysis
Workmen Of Dimakuchi Tea Estate V Dimakuchi Tea Estate, (1958) 1 LLJ 500 (SC)
In this case, an individual named Dr. Banerjee was appointed by the respondents as their Assistant Medical Officer, on three months’ probation. After three months, his services were terminated, with one month’s salary instead of notice, on the ground of incompetency. On behalf of his cause by the Assam Karamchari Sangh, the Government of Assam referred the dispute to a tribunal regarding his reinstatement. The Tribunal held that the Medical Officer was not a ‘workman’ and hence the Tribunal had no jurisdiction to adjudicate the dispute.
Before the Supreme Court, the workmen raised the plea that a dispute concerning a person who is not a workman could be an industrial dispute. The learned counsel for the workmen submitted that the expression ‘any person’ occurring in the last part of the definition of ‘industrial dispute’ [Section 2(k)] is an expression of very wide import and there are no reasons why the words ‘any person’ should be equated with ‘any workman.’
The Supreme Court, however, observed that the expression ‘any person’ cannot mean anybody and everybody in this wide world. Otherwise, it would be open to the workmen not only to raise a dispute about the terms of employment of persons employed in the same industry as themselves, not only to raise a dispute about the terms of employment in corresponding or similar industries, but also raise a dispute about the terms of employment of persons employed in our country, but terms of employment of any workman or any labourer anywhere in the world.
The Supreme Court held as follows:
(i) The expression ‘any person’ in Section 2(k) must be read subject to such limitations and qualifications as arise from the context.
(ii) One such crucial limitation is: the dispute must be real and substantial, in the sense of one party being in the position to give relief to the other. ‘Any person’, therefore, cannot mean a person concerning whom the employer is in no position to give any relief.
(iii) Thus, ‘any person’ can only be a person in whom the workers have a direct and substantial interest, i.e., a community of interest. Community of interest cannot exist unless the person is a past or present employee.
(iv) Ordinarily, it is only the aggrieved party who can raise a dispute; but an ‘industrial dispute’ can be on a collective basis, because it was settled that an industrial dispute, not espoused by the workmen, i.e. the class to which the aggrieved party belongs, is not an ‘industrial dispute’ within the meaning of Section 2(k).
Therefore, the Supreme Court held that Dr. Banerjee was not a ‘workman’. He belonged to the medical or technical staff, a different category altogether from workmen. The appellants had no direct or substantial interest in his employment or non-employment, and even assuming that he was a member of the same Trade Union, it cannot be said that the dispute regarding his termination of service was an industrial dispute within the meaning of Section 2(k) of the Act.
Bongaigaon Refinery & Petrochemicals Ltd. V. Samijuddin Ahmad (Air 2001 Sc 3577)
In this case, the respondent was recruited by the appellant company under a ‘benevolent employment scheme’ of employment to candidates whose land had been acquired by the company. He got his job by concealing the fact that his two brothers had already been given employment by the company.
This fact became known to of respondent and therefore his appointment was cancelled and joining was refused. The respondent raised a dispute, but the Government refused to refer to the ground that the respondent was not a workman as he had not joined service.
The Supreme Court held that the respondent made a material concealment of facts and tried to secure employment to which he was not entitled under the Scheme. Such concealment was detected timely, and therefore his joining report was not accepted.
The respondent relied on the judgment in Workmen of Dimakuchi Tea Estate case (AIR 1958 SC 353) to submit that, given Section 2(k) of Industrial Disputes Act, 1947, a dispute raised by ‘any person’ even if not a ‘workman’ stricto sensu is competent. The court, however, observed that what was said in the Dimakuchi case was that a person need not be a ‘workman’ stricto sensu, but he must have been employed and yet claiming to be a workman. It was held that ‘any person’ cannot be read without limitation, and a person in respect of which the employer-employee relationship never existed and can never possibly exist cannot be the subject matter of dispute between employers and workmen. The word ‘person’ in Section 2(k) does not include a non-workman employee.
Municipal Corpn. Of Delhi V Female Workers (Muster Roll) (Air 2000 Sc 1274)
In this case, the female workers employed on daily wages (muster roll), by the Municipal Corporation, demanded maternity leave and maternity benefits available to regular female workers. The Delhi Municipal Workers’ Union represented the workers. It was contended by the workers that although they are recruited and work together just like regular employees of the Municipal Corporation, they were not given maternity benefits under the Act. The denial of such benefits, therefore, was due to the negative attitude of the Corporation.
The Industrial Tribunal issued a direction to the management of the Municipal Corporation of Delhi to extend the benefits of the Maternity Benefit Act to such muster roll female employees who were in continuous service of the management for three years or more and who fulfilled the conditions set out in Section 5 of that Act.
It was argued that since the provisions of the Maternity Benefit Act have not been applied to the Corporation, such a direction could not have been issued by the Tribunal. The Supreme Court, however, cited the case of J.K. Cotton Spg. & Wvg. Mills Co. Ltd. v Labour Appellate Tribunal of India (AIR 1964 SC 737) held that the female workers working on muster roll (daily wages) should be given maternity benefits like regular employees of the municipal corporation. Such female workers would be classified as ‘workmen’ and the dispute between them and the Corporation would have to be tackled as an ‘industrial dispute’ in the light of various statutory provisions of the industrial law, including Maternity Benefit Act, 1961.
Disputes Involving Contract Labour
The issue of contract labour often gives rise to industrial disputes. One such dispute was seen in the case of Standard Vacuum Refining Co. v Their Workmen (1960) 2 LLJ 233 (SC). In this case, the company used to give an annual contract for maintenance of plant and premises. The contractor’s men were not entitled to any privileges, and there was no security of employment. The workmen raised an industrial dispute demanding the abolition of the contract system.
The Supreme Court held the dispute to be an industrial dispute because there was a real and substantial dispute between the company and the workmen on the question of employment of contract labour for the work of the company. The fact that the workmen were employed by the contractor would not alter the nature of the dispute so long as the party raising the dispute had a direct interest in the subject-matter of the dispute.
The Supreme Court observed that whenever a dispute is raised by workmen regarding the employment of contract labour by an employer, it would be necessary for the Tribunal to examine the merits of the dispute apart from the general consideration that contract labour should not be encouraged, and that in a given case the decision should not be based merely on theoretical or abstract objections to contract labour, but on the terms and conditions on which contract labour is employed and the grievance made by the employees in respect thereof. Henceforth, the dispute was ultimately classified as an ‘Industrial Dispute’.
In the cases where the labour engaged by the contractor was deprived of legal facilities enjoyed by other workers, it was held that the employment of contract labour was an unfair labour practice as per Shibu Metal Works v Workmen (1966) 1 LLJ 717.
In the case of K.K. Thilakam v FACT Ltd. (1992) 2 LLJ 782 (Ker), the petitioners were employed by the contractor in connection with the work of a company. After about 10 years of service, they claimed to be absorbed in service under the company. It was held that they were never the workmen of the company but were only seeking employment. An industrial dispute cannot exist between an employer and a person seeking employment.
Conclusion
The definition of ‘industrial dispute’ under Section 2(k) of the Industrial Disputes Act, 1947, is the gateway to the Act’s dispute resolution machinery. Its comprehensive wording, coupled with extensive judicial interpretation, ensures that a wide array of disagreements between employers and workmen, or even among themselves, can be addressed, provided they meet the tripartite criteria of a real dispute, appropriate parties, and a connection to employment, non-employment, terms of employment, or conditions of labour of ‘any person’.
The indispensable element of ‘community of interest’, as rigorously established in cases like Dimakuchi Tea Estate, ensures that disputes are not merely individual grievances but reflect a collective concern of the workmen as a class. While the Act provides a robust framework for resolving conflicts, it is equally clear that not every difference or demand qualifies. The dispute must be substantial, capable of affecting industrial peace, and concern a person in whom the workmen have a direct or substantial interest, typically implying a past or present employment relationship. The consistent application of these principles by the judiciary has been instrumental in balancing the rights of workers with the operational realities of industries, making Section 2(k) a dynamic and evolving provision at the heart of Indian labour law.
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