➢PROJECT:- DisPute resolution mechanism under the

industrial disPutes act 1947.

➢NAME:- AMAN KUMAR.

➢SEMESTER:- 10(X)
➢ROLL NUMBER:- 10
➢SECTION:- A

 TABLE OF CONTENTS
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 Acknowledgement…………………………………...……………………….….3

 Introduction………………………………………………..…………..………….4
 Industrial Dispute Act,1947……………………………………………………..5
 Individual disputes………………………………………………………..6
 Collective disputes:-……………………………………………………...6
 Disputes of rights and interest…………………………………………..7
 Dispute Redressal Bodies………………………………………………………7
 Internal Mechanism of Settlement disputes under the
Industrial Dispute Act..................................................................................7
 Works Committee………………………………………………………...7
 Grievance Redressal Committee……………………………………….8
 External Mechanism of Settlement disputes under the
Industrial Dispute Act………..………………………………………...............8
 Collective Bargaining………………………………………………………..8
 Conciliation and Mediation……………………………………………........9
 Voluntary arbitration………………………………………………………..10
 Adjudication………………………………………………………………....11
 Labour court……………………………………………………………..11
 Industrial tribunal………………………………………………………..12
 National tribunal.………………………………………………………...12
 Court of inquiry……………………………………………………………...13

 Landmark judgments…………………………………………………………..13
 CONCLUSION………………………………………………………………….15
 SUGGESTIONS………………………………………………………………..15

 BIBLIOGRAPHY……………………………………………………………….17

 Acknowledgement

2|Page
I would like to express my special thanks of
gratitude to my Prof. Dr. Satish Chandra sir
who gave me the golden opportunity to do this
project on the topic DisPute resolution mechanism
under the Industrial DisPutes Act 1947. It helped me in
doing a lot of Research and I came to know
about a lot of things related to this topic.

 INTRODUCTION
Disputes are always a drawback for any industry. A dispute arises
for several reasons, the most common being the relation between
the labourers and their wages. It is the conflict of interests between
two parties that give rise to a dispute.The parties involved in an
industrial dispute are the employer and the employee. Traditionally
speaking, the employees have always been placed on the lower

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ladder of the society by the employer presenting a dominating self-
being in the position of authority. An employee has the right to be
provided with wages depending on the amount of work he delivers.
It is the responsibility on the part of the employer to provide his
employees with a reasonable amount of wages along with other
conditions that are necessary for a person to earn his livelihood.
The founder of the Australian system of arbitration and
conciliation, Mr Justice Higgins had correctly pointed out that the
conflict between wage earners and the profit creators will always be
existing with us in our everyday life. It is therefore always necessary
to settle the disputes arising between two parties under
the Industrial Dispute Act,1947 in order to prevent the industry from
facing loss or sufferings. 
All disputes arising in an industry cannot be resolved in the same
manner and therefore comes the concept of the mechanism of
settling disputes under the Industrial Dispute Act,1947. It is a
constant fight against oppression on the part of those who are
employed for providing welfare among other sections of the society
and not being subjected to similar kind of welfare due to the
authoritative rule on the part of the employer. It is correct that the
disputes settlement mechanisms can provide relief for a temporary
period only, these settlement mechanisms, if used effectively, can
provide long term services also. Therefore what is necessary is the
correct application of the mechanisms available for settling
disputes. 

 Industrial Dispute Act,1947

The Industrial Dispute Act,1947 is an Act that was formulated to
guarantee fair and equal terms between the employer and the
employee. The act aims to settle the disputes that arise through
negotiations. By doing so it promotes industrial harmony and peace.
The Industrial Dispute Act,1947 regulates the labour law in India as
far as the same relates to trade unions.
  Section2(k) of the Act,1947 lays down the meaning of an
industrial dispute.The parties that can be involved in an industrial
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dispute includes employers and workmen, two employees,
employer and workmen. The provision also lays down the grounds
that need to be abided by in order to term a dispute as an industrial
dispute. These grounds are provided hereunder:
(1):-The mere difference of opinion will not constitute an industrial
dispute instead of a factum of dispute will.
(2):-The date of commencement of the dispute should be provided
in writing by the union otherwise the same reference will be
declared invalid. It was in the case of Union of Journalists v. The
Hindu where the court observed that if the demand by the
employees were not brought before the management under which
they work, and similar demands were raised during the time of the
proceedings, the dispute will still be considered as an industrial
dispute and proceed further with settlement mechanisms.
(3):-The dispute should be such that it affects the well-being of the
majority of workmen and not a single work-man.
(4):-The dispute that has arisen should be in relation with an
individual workman or workmen in whom they being a body is or are
interested in. 
To maintain a cordial relation between the employer and the
employee, the Act lays down settlement mechanisms as well that
can be of some help. The authorities on whom the Act confers
authority to carry out settlement and investigation purposes for an
industrial dispute are mentioned below:
1. Conciliation officer under Section 4 of the Act,1947.
2. Works committee under Section 3 of the Act,1947.
3. Labour court under Section 7 of the Act,1947.
4. Boards of conciliation under Section 5 of the Act, 1947.
5. Labour Tribunal under Section 7A of the Act, 1947.
6. National tribunal under Section 7B of the Act, 1947.

In the case of State of Bihar v. D.N.Ganguli, the Supreme Court

decided that if a dispute which has already been settled amicably
by the parties have been brought before the tribunal with an
assumption that the same will be reconsidered by the tribunal then
it would be very unreasonable to do so. As soon as the matter is
settled before the tribunal, the reward as compensation for the
dispute will be provided by the tribunal itself.

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 The Act under Section 10 provides that if there arises any
industrial dispute, that might be referred by the appropriate
government for adjudication to the Conciliation Board, Court of
inquiry, labour court, national tribunal or industrial tribunal. The
different types of disputes that come under the ambit of an industrial
dispute are:

1. Individual disputes:- Under which the disputes of

termination, discharge, promotion of workmen, security
measures available to the workers, retirement benefits come
in.In the case of Central Provinces Transport Services
Ltd., v. R.G. Patwardhan the court opined that if a dispute
arises between an employer and a workman, then that
cannot be termed as an industrial dispute unless the dispute
is taken up by the trade union or a collective group of
workmen claiming that a legal dispute has taken place.
Therefore, in this case, the Supreme Court extended its
support towards the trade union so that an individual dispute
can be treated as an industrial dispute and settlement can
be done. 
2. Collective disputes:- Those disputes which involve a group
of workmen whose rights and interests have been
contravened with by the employer. This dispute is referred to
as the most important industrial dispute which if not resolved
leads to a stoppage of work by the workers that can be
detrimental for the industry as a whole. 

3. Disputes of rights and interest:- It is another kind of

industrial dispute. Disputes of rights are also referred to as
legal disputes that deal with the rights of the workmen that
are already existing. When there is a violation of the legal
rights of the workers, disputes arise regarding the same. 
The Act does not provide any provision for settling disputes by
means of bilateral negotiations. If the parties fail to negotiate
mutually between themselves then the only way of resolving an
industrial dispute is by adjudication on the reference of the
appropriate government. Therefore the role of voluntary arbitration

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is necessary on the basic grounds for the parties involved in the
dispute to resolve the same easily. If the same is not done then
there are also other ways of resolving the disputes. The best way of
resolving disputes is by means of collective bargaining which
symbolises plurality of workmen working in the industry. If collective
bargaining fails, then other mechanisms of settlement involve
conciliation, arbitration and voluntary arbitration. These methods
are considered to be the appropriate alternatives for collective
bargaining. 
 Dispute Redressal Bodies:-
Industrial disputes may be broadly classified into interest
disputes and rights disputes. Interest disputes are mostly related to
the determination of a revised wage level and other conditions of
employment. Whereas, rights disputes relate to the interpretation
and application of existing standards of employment and usually
involve an individual worker or group of workers. The Industrial
Disputes Act, 1947 has provided for the establishment of both
internal and external mechanisms to settle industrial disputes.

 Internal Mechanism of Settlement disputes under the

Industrial Dispute Act:-

1:- Works Committee:-

Section (3) of the Act is statutorily mandatory in all industrial
establishments having a hundred or more workmen. It consists of
representatives of employees and workmen of an establishment.
The workmen’s representatives and employer representatives
should be equal in number. The object of the works committee is to
provide for an internal forum for dispute resolution as a precursor to
litigation or external mechanisms for dispute resolution.

2:- Grievance Redressal Committee:-

Section 9(c) of the Act requires the employer in every industrial
establishment in which fifty or more workmen are employed to
provide for a grievance settlement authority. Every industrial
establishment consisting of twenty or more workmen shall have one
or more grievance redressal committees that shall be composed in
equal proportion by members of management and the workmen.
The total number of members in the committee shall not exceed six

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and shall include one female member if feasible. The Grievance
Redressal Committee shall complete its proceedings within forty-
five days after the receipt of a written complaint by an aggrieved
party. Any workman dissatisfied by the decision of the committee
may prefer to appeal against it. The employer is then obliged to
consider the appeal and dispose of the matter within one month
from the date of its institution and provide a copy of the decision to
the aggrieved employee.

 External Mechanism of Settlement disputes under the

Industrial Dispute Act:-
Certain machinery is existing under the methods of settling
industrial disputes which helps in regulating the settlement and
handling of the dispute in a just and fair manner for the parties
involved in the dispute and thereby ensure or guarantee a
normalised situation under which the employer and the employee
can exist and work in a friendly manner which is required for the
growth of the industry. The common mechanisms for settlement of
disputes under the Industrial Dispute Act,1947 have been explained
in detail below.

1:-Collective Bargaining:- Collective Bargaining or Negotiation is

one of the methods for settlement of an industrial dispute. It plays
significant role in promoting labour management relations and in
ensuring industrial harmony.
Collective Bargaining is a process/Method by which problems of
wages and conditions of employment are settled amicably,
peacefully and voluntarily between labour and management. In
collective bargaining, the parties to the dispute i.e., the employer
and the employees/workmen settle their disputes by mutual
discussions and agreements without the intervention of a third
party. Such settlements are called "bipartite settlement". Therefore,
settlement of labour disputes by direct Negotiation or settlement
through collective bargaining is always preferable as it is the best
way for the betterment of labour disputes.

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2:-Conciliation and Mediation:-
One of the most familiar ways to carry out the settlement of
disputes under the Industrial Dispute Act,1947 is conciliation which
is also well-known by the name of mediation. It is not only restricted
to India but this method of dispute settlement is used all across the
world. Conciliation is the procedure in which there is an involvement
of a third party who provides assistance to the parties in dispute to
carry out negotiation between them. The two types of machinery
that are available for executing the conciliation functions are:
1. By the conciliation officers who work in the department of
labour
2. The Conciliation Board is a body of several members
consisting of a chairman, two to four members as the
representatives of the employers and the employees. These
members are to be appointed by the government on parties
recommendation.

Section 4 of the Industrial Dispute Act, 1947 lays down the

function of a conciliation officer which is to create a kindred
atmosphere within the industry which will help the parties to settle
the disputes between them. This is a function with an administrative
nature and not a judicial one. 
A conciliation officer is required to hold proceedings, carry out
investigations regarding the dispute in a fair manner to help the
parties arrive at a settlement. They are appointed to regulate
settlement disputes for a specified area either for a temporary time
period or permanently. While Section 11 of the Industrial Dispute
Act, 1947 lays down the powers vested upon a conciliation
officer, Sections 12 and 13 are meant for dealing with the duties of
the conciliation officer. 
After the government agrees that there is a failure in the report, to
his satisfaction he can send the matter to the Board of Conciliation
or any other adjudicating body to look after the same. If such a step
is not preferred, then the government directly communicates the
matter to the parties involved in the dispute. The usage of
conciliation as a settlement dispute mechanism is indeed effective
as have been revealed by the statistical study. The parties while
being a part of the conciliation proceeding do not reveal the entire

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dispute matter with the thought that if the proceedings are not
effective enough to settle the dispute then the same can be tried by
other legal remedies that are available also. It is when the
conciliation officers are not able to handle the disputed matter, the
matter gets passed on to the tribunals. This is also cited as a
reason for the failure of conciliation.
3:-Voluntary arbitration:- 
Section 10A of the Industrial Dispute Act, 1947 provides the
provision for voluntary arbitration which in a real-world is completely
carried out by adjudication. Arbitration and adjudication have a very
thin line of difference between them. While in the former the judge
is decided by the parties involved in the dispute, whereas in the
latter the judge is appointed by the State. 
The origin of voluntary arbitration in India dates back to the issue of
plague bonus in the Ahmedabad Textile Mills under the leadership
of the father of the nation, Mahatma Gandhi.To make voluntary
arbitration compulsory, The Trade Unions & Industrial Disputes
(Amendment) Bill, 1988 was brought in laying down restrictions on
legal strikes by the employees. According to the bill, legal strikes
can be carried out by the parties only after either of the parties has
rejected the offer of arbitration that had been provided to the parties
to settle the dispute. Although several efforts have been put to
effect by the Indian government, voluntary arbitration still remains in
shadows as have been reflected by the statistics.
It was in the case of Gujarat Steel Tubes Ltd. v. Gujarat Steel
Tubes Mazdoor Sabha, the apex court inform judicial legislation
vested on the arbitrator the powers of a labour tribunal for cases of
discharge of workmen as a form of punishment. This provided the
arbitrator with appellate jurisdiction using which the arbitrator can
oppose the decision of an employer regarding his employees.
These exceptional powers were conferred by the Supreme Court of
India on the arbitrator. 

4:-Adjudication:-
It is not that adjudication replaces conciliation totally but rather
the matter is if conciliation fails to settle the dispute between the
parties in the industry, adjudication takes charge in carrying out the
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job which the conciliation mechanism was assigned to do. It is just
another legal remedy that can be adopted if the necessity arises.
The ultimate remedy for resolving an industrial dispute is by
adjudication. 
Adjudication can also be termed as the compulsory settlement of
the industrial dispute in concern by labour courts, industrial
tribunals, and national tribunal as provided by the Industrial Dispute
Act,1947. The terms adjudication and arbitration have minute
differences if placed in our country. 
It is on the government to decide whether to refer to the party or
not before proceeding with the adjudication mechanism. If the
parties are involved by the government then that type of
adjudication will be referred to as voluntary adjudication. Whereas if
the government does not feel it to be necessary to involve the
parties in the adjudication mechanism then that kind of adjudication
will be called compulsory adjudication. 
Adjudication of the industrial dispute will take place by a three-tier
system which will be inclusive of the following:
(a):-Labour court- The Industrial Dispute Act, 1947 under
Section 7 provides for the constitution of a labour court. The
appropriate government in the form of notification in the
official gazette can lead to the constitution of a labour court
for resolving the disputes in an industry. The labour court
consists of one person who is an independent judge or a
judge of the High court or the District court. The judge can
also be a former judge of the labour court itself with an
experience of about 5 years. The matters handled by the
labour court are provided in the second schedule of the
Industrial Dispute Act, 1947 which consists of:

1. The legality in the order passed by the employer

under the orders that are standing.
2. The implications of the standing orders.
3. Granting of relief that should be available to the
workmen in the industry which has been dismissed from
them.
4. Withdrawal of any privilege that a workman is subjected
to

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 5. All matters other than that coming under the purview of
the industrial tribunal.

(b):-Industrial tribunal:- The provision for the industrial tribunal

is provided under Section 7A of the Industrial Dispute Act, 1947.
One or more industrial tribunals can be set up by the government
according to his desire with the courts being provided with wider
jurisdiction in comparison with the labour court. It is not to be
considered as a permanent body but body set up for temporary
purpose for hearing on an ad-hoc basis only. As the courts are
having wider jurisdiction, the issues that will be taken into
consideration by the courts will also be large in number. Broadly
the issues handled by the industrial tribunal have been listed
below:

1:-Wages of the employee which included the mode of payment

of wages also.
2:-Bonus and provident funds that are provided
3:-Working hours of the employees
4:-Rationalisation
5:-Leaves that are granted to the employees inclusive of the
wages received and the holidays provided to them
6:-Rules associated with the maintenance of discipline in the
industry among the employees.
7:-Any other matter which may be considered to be heard and
discussed necessarily.

(c):-National tribunal:- A national tribunal is formed by the

Central Government by an official gazette for adjudication of
the industrial disputes that are considered to be of national
importance. Two people according to the choice of the
government are appointed to the role of an assessor in the
national tribunal. If a dispute between two parties of an
industry reaches the national tribunal, then both the labour
court and the industrial tribunal loses its jurisdiction over the
matter. 

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5:-Court of inquiry:-
The remedy in the form of a court of inquiry was first provided
by The Trade Disputes Act, 1929 and was followed by the Industrial
Dispute Act, 1947 also under Section 6. This mechanism of settling
disputes has been out of use in the country now.  As the
government of India could not figure out the benefit from this
machinery in industrial dispute cases, the machinery has been
eliminated completely by The Trade Unions & Industrial Disputes
(Amendment) Bill, 1988 and is no more in use.  

Landmark judgments:-
In the case of Workmen of Hindustan Lever Ltd v. Hindustan
Lever Ltd, the court observed that for every industry there is a
necessity to promote harmonious construction of the wants of both
the employer and the employee of an industry for the industry and
the labour force to grow and prosper in the long-term. In order to
achieve this objective, the court laid down that there is a need for
compulsory adjudication for resolving industrial disputes by means
of a forum where the parties can resort for arbitration to avoid any
kind of confrontation between them in the industry. The courts have
repeatedly made it clear that although a lot of powers have been
vested over an appropriate government, he cannot misuse such
power in carrying out the procedure of settlement of disputes.

In the case of The Govt of India Vs. National Tobacco Company,

the court held that the powers that have been vested in the
appropriate government are discretionary in nature and not
mandatory. Therefore if in any particular case the government carry
out arbitrary actions which are contrary to the statute under which
he is supposed to function and has been refusing to refer the
dispute at hand to the tribunals or the labour court, then such
grounds will be enough to file a writ petition against the government
under Article 226 of the Constitution of India. From this case, it can
be observed that the Act provides with no scope to misuse the
powers that have been vested to any administrative body that can

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directly affect the dispute that is already existing and can further
accelerate it as well creating more problems. 

Adding more to this idea of restricting the use of arbitrary power, the
court in the case of Hochtief Gammon v. the State of Orissa was
of the opinion that the courts will have the authority to view that the
action taken by the executive is not unlawful and unfair in nature
and in this process the courts’ vests the duty of ensuring that the
relevant matters of the dispute have been taken into concern in a
large away while making a decision on the appropriate government.
It was in the well-known case of Mathura Refinery Mazdoor
Sangh v. Union of India, the Supreme Court of India gave
importance to the tribunals to deal with the industrial dispute and
also directed the government to take consultancy from the tribunals
itself. Thus in this way, the court separated the mechanism of
settlement dispute under the Industrial Dispute Act,1947 as a
separate entity altogether. 

In another case named United Bleachers (P) Ltd. v. LC, the High

Court at Madras was of the view that if any kind of delay happens
on the part of the appropriate government to make a reference,
then that will not be a valid ground to decline the relief that is to be
granted to the labourers who are in the dispute and have relatively
suffered from the same already. If there is a denial of the relief on
this very ground then the same will be referred to as an unfair
labour practice and thereby will be unlawful. Thus the judgments
that are discussed above reflects that whatever be the dispute, the
courts always intend to settle it providing justice to both the parties
involved in the dispute.

 CONCLUSION:-
Despite a lot of loopholes in the system, the interference of the
Supreme Court and the High Courts have indeed been helpful in
regulating the statute governing the industrial dispute. Settlement

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disputes under the Industrial Dispute Act, 1947 is indeed a way in
which the chaos associated with industry can be removed. As India
slowly develops with the introduction of several industries, it has
become necessary to ensure the proper functioning of the
industries in order to help develop the country economically. For the
same the Industries Dispute Act, 1947 plays an essential role by not
only providing the provisions as to how to regulate the working of an
industry but also laying down settlement mechanisms that can help
resolve disputes between the employee and employer.
Coordination of both can help industry run smoothly and effectively.
While the Act provides for both internal and external bodies for
dispute resolution and prevention of illegal strikes, lockouts and
mitigates the use of unfair labour practices, from a compliance
perspective it is important to have robust internal mechanisms that
address disputes. External mechanisms generally require a great
deal of effort, expense and time spent which generally leads to a
soured relationship between employer and employee. Thus, having
internal mechanisms is preferable because the likelihood of having
to rely on adjudication or alternate dispute resolution reduces
thereby providing for an amicable working relationship which
ultimately leads to greater productivity.

 SUGGESTIONS:-
Some of the ways in which settlement machinery can function
effectively are listed hereunder:

1. The mechanism of conciliation should be regulated by the

officers who are experienced in the field and are
acknowledged with the issues that are majorly faced by
industrial workers. This mechanism should also not be a
subject-matter for the political and administrative influences
in order to prevent the mechanism from being used in a
wrong way which can affect the industrial dispute that is
already at hand.
2. Industrial Relations Commissions should be set up at both
Central and provincial levels according to the guidelines of
the National Commission of Labours in order to strengthen
the framework of the available adjudicatory machinery. 
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 3. The arbitration procedure should be just and fair like all
other court proceedings so that the decision taken as a
conclusion to the industrial dispute that has arisen should be
able to satisfy both the parties involved in the dispute. 
4. Government interference from any kind of industrial dispute
should be avoided unless urgently required in order to deal
with the matter effectively and independently without much
influence as has been mentioned earlier as well. The
arbitrators are supposed to take independent decisions so
that the employers and the employees are treated equally
and fairly.

 BIBLIOGRAPHY:-
1. https://shodhganga.inflibnet.ac.in
2. http://www.legalserviceindia.com
3. https://www.yourarticlelibrary.com
4. https://www.legalservice.com

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5. https://www.legalbites.in
6. https://www.simliance.in
7. https://www.lawoctopus.in
8. https://www.wikipedia.com

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