Labour law unit 3

1. define strike and lockout with case references?

Definitions of Strike:
Strike as defined in clause (q) of Section 2 of the Act means:
1. Cessation of work by a body of persons employed in any industry acting in combination; or
2. A concerted refusal of any number of persons who are or have been employed in any
industry to continue to work or to accept employment; or
3. A refusal under a common understanding of any number of persons who are or have been
employed in any industry to continue to work or to accept employment.
Thus the definition given in the act postulates three main things or ingredients:
(a) Plurity of workmen;
(b) Combination or concerted action;
(c) Cessation of work or refusal to do work.

Historical Background: Strikes came into existence in the wake of the Industrial Revolution.
The first known strike was in the 12th century B.C., in Egypt. Workers under Pharaoh Ramses
III stopped working on the Necropolis until they were treated better.
The 1974 railway strike in India was the strike by workers of Indian Railways in 1974.
The 20 days strike by 17 lakh workers is the largest known strike in India. The strike was held
to demand a raise in pay scale, which had remained stagnant over many years, in spite of the
fact that pay scales of other government owned entities had risen over the years.
Strikes became common during the Industrial Revolution, when mass labor became
important in factories and mines.
In most countries, strike actions were quickly made illegal, as factory owners had far more
political power than workers.
Strike means the stoppage of work by a body of workmen acting in concert with a view to
bring pressure upon the employer to concede to their demands during an industrial dispute.

Indian Iron & Steel Ltd. v. Its Workmen it was held that mere cessation of work does not
come within the preview of strike unless it can be shown that such cessation of work was a
concerted action for the enforcement of an industrial demand.
Cessation of work or refusal to work is an essential element of strike. This is the most
significant characteristic of the concept of strike. There can be no strike if there is no
cessation of work.
The cessation of work may take any form. It must however be temporary and not forever
and it must be voluntary.

Buckingham & Carnatak Co. Ltd. v. Workers of Buckingham& Carnatak Co. Ltd. On the 1st
November, 1948 night shift operators of carding ad spinning department of the Carnatak Mill
stopped work at 4 p.m. some at 4:30 p.m. and some at 5 p.m. The stoppage ended at 8 p.m.
in both the departments. By 10 p.m. the strike ended completely. The cause for the strike
was that the management of the Mills had expressed inability to comply with the request of
the workers to declare 1st November, 1948 as a holiday for solar eclipse. Supreme Court
held it strike. Concerted action is another important ingredient of strike. The workers must
act under a common understanding. The cessation of work by a body of persons employed in
 any industry in combination is a strike. Stoppage of work by workers individually does not
amount to strike.

In Ram Sarup & Another v. Rex held that Mere absence from work is not enough but there
must be concerted refusal to work, to constitute a strike.
The object of an industrial strike is achievement of economic objectives or defence of mutual
interests. The objects of strikes must be connected with the employment, non employment,
terms of employment or terms and conditions of labour because they are prominent issues
on which the workers may go on strikes for pressing their demands and such objects include
the demands for codification of proper labour laws in order to abolish unfair labour
practices prevalent in a particular area of industrial activity.
The strike may also be used as a weapon for betterment of working conditions, for
achievement of safeguards, benefits and other protection for themselves, their dependents
and for their little ones.
In B. R. Singh v Union of India it was held that the strike is a form of demonstration. Though
the right to strike or right to demonstrate is not a fundamental right, it is recognized as a
mode of redress for resolving the grievances of the workers.
In T.K. Rangarajan v Tamil Nadu, the Tamil Nadu government terminated the services of all
employees who resorted to strike. The Apex Court held that Government staffs have no
statutory, moral or fundamental right to strike
In Dharma Singh Rajput v. Bank of India, it was held that right to strike as a mode of redress
of the legitimate grievance of the workers is recognized by the Industrial Disputes Act.
However, this right is to be exercised after complying with the conditions mentioned in the
Act and also after exhausting the intermediate and salutary remedy for conciliation.

Strikes are caused by differences as to:

1. Rates of wages and demands for advances or reductions i.e. Bonus, profit sharing, provident fund
and gratuity.

2. Payment of wages, changes in the method, time or frequency of payment;

3. Hours of labor and rest intervals;

4. Administration and methods of work, for or against changes in the methods of work or rules and
methods of administration, including the difficulties regarding labor-saving machinery, piece-work,
apprentices and discharged employees;

5. Trade unionism.

6. Retrenchment of workmen and closure of establishment.

7. Wrongful discharge or dismissal of workmen.

Kinds of Strike:

1. General Strike: In General Strike, the workmen join together for common cause and stay away
from work, depriving the employer of their labour needed to run his factory. Token Strike is also a
kind of General Strike. Token Strike is for a day or a few hours or for a short duration because its
main object is to draw the attention of the employer by demonstrating the solidarity and co-
operation of the workers. General Strike is for a longer period. It is generally resorted to when
employees fail to achieve their object by other means including a token strike which generally
proceeds a General Strike. The common forms of such strikes are organized by central trade unions in
railways, post and telegraph, etc. Hartals and Bundhs also fall in this category.

2. Stay-in-Strike: It is also known as ‘tools-down-strike’ or ‘pens-down-strike. It is the form of strike

where the workmen report to their duties, occupy the premises but do not work. The employer is
thus prevented from employing other labour to carry on his business. In Mysore Machinery
Manufacturers v/s State Court held that where dismissed workmen were staying on premises and
refused to leave them, did not amount to strike but an offence of criminal trespass. In Punjab
National Bank Ltd. v/s their workmen Court held that Refusal under common understanding to
continue to work is a strike and if in pursuance of such common understanding the employees
entered the premises of the bank and refused to take their pens in their hands would no doubt be a
strike under section 2(q).

3. Go-Slow: In a ‘Go-Slow’ strike, the workmen do not stay away from work. They do come to their
work and work also, but with a slow speed in order to lower down the production and thereby
cause loss to the employer. In Sasa Musa Sugar Works Pvt. Ltd. v/s Shobrati Khan & Ors held that
GoSlow strike is not a “strike” within the meaning of the term in the Act, but is serious misconduct
which is insidious in its nature and cannot be countenanced.

i. Hunger Strike: In Hunger Strike a group of workmen resort to fasting on or near the place of work
or the residence of the employer with a view to coerce the employer to accept their demands.
Piparaich Sugar Mills Ltd. v/s Their Workmen Certain employees who held key positions in the mill
resorted to hunger strike at the residence of the managing Director, with the result that even those
workmen who reported to their duties could not be given work. Held: That concerted action of the
workmen who went on Hunger Strike amounted to “strike” within the meaning of this sub-section.

ii. Sympathetic Strike: A Sympathetic Strike is resorted to in sympathy of other striking workmen. It
is one which is called for the purpose of indirectly aiding others. Its aim is to encourage or to extend
moral support to or indirectly to aid the striking workmen. The sympathizers resorting to such strike
have no demand or grievance of their own.

iii. Work to rule: Here the employees strictly adhere to the rules while performing their duties
which ordinarily they do not observe. Thus strict observance of rules results in slowing down the
tempo of work causes inconvenience to the public and embarrassment to the employer. It is no strike
because there is no stoppage of work at all.

Definition of Lock-Out:

“Lock-Out” has been defined in section 2 (1) to mean the closing of a place of employment, or the
suspension of work, or the refusal by an employer to continue to employ any number of persons
employed by him. India witnessed lock-out twentyfive years after the "lock-out" was known and
used in the arena of labour management relations in industrially advanced countries.

Strike is a weapon in the hands of the labour to force the management to accept their demands.
Similarly, Lock-Out is a weapon in the hands of the management to coerce the labour to come down
in their demands relating to the conditions of employment. Lock-Out is the keeping of labour away
from works by an employer with a view to resist their claim.

There are four ingredients of Lock-Out:-

1. Lock out is a:

A. temporary closing of a place of employment by the employer, or

B. suspension of work by the employer, or
C. refusal by an employer to continue to employ any number of persons employed by him;

2. The above-mentioned acts of the employer should be motivated by coercion.

3. An industry as defined in the Act; and

4. A dispute in such industry Lock-Out has been described by the Supreme Court:

Shri. Ramchandra Spinning Mills v. State of Madrasheld that if the employer shuts down his place
of business as a means of reprisals or as an instrument of coercion or as a mode of exerting
pressure on the employees.

In case of Lock-Out the workmen are asked by the employer to keep away from work, and, therefore
they are not under any obligation to present themselves for work. So also Lock-Out is due to and
during an industrial dispute.

Causes:

A lockout is generally used to enforce terms of employment upon a group of employees during a
dispute.

A lockout can act to force unionized workers to accept changed conditions such as lower wages. If
the union is asking for higher wages, or better benefits, an employer may use the threat of a
lockout or an actual lockout to convince the union to back down.

Lock-Outs may be caused by internal disturbances, when the factory management goes in to
financial crisis or got succumbed into financial debts, disputes between workers and workers,
disputes between workers and management or may be caused by ill-treatment of workers by the
management. Sometimes lockouts may be caused by external influences, such as unnecessary
political parties involvement in management of workers, union may be provoked for unjustified
demands that may be unaffordable by the management, which may ultimately lead to lockout of the
factory.

1. Disputes or clashes between workers and the management.

2. Unrest, disputes or clashes in between workers and workers.

3. Illegal strikes, regular strikes or continuous strikes by workers.

4. Continuous or accumulated financial losses of factory or industry.

5. If any company involves in any fraudulent or illegal activities.

6. Failure in maintaining proper industrial relations, industrial peace and harmony.

Prohibition of Strikes and Lock-outs:

Section 22 of the Industrial Disputes Act, 1947, deals with the prohibition of strikes and lock-outs.
This section applies to the strikes or lock-outs in industries carrying on public utility service. Strike or
lock-out in this section is not absolutely prohibited but certain requirements are to be fulfilled by the
workmen before resorting to strike or by the employers before locking out the place of business.
Conditions laid down in section 22(1) are to be fulfilled in case of strike.

Section 22(1): No person employed in public utility service shall go on strike in breach of contract:

a) Without giving to the employer notice of strike within six weeks before striking; or

b) Within fourteen days of giving such notice; or

c) Before the expiry of the date of strike specified an any such notice as aforesaid; or

d) During the pendency of any conciliation proceedings before a Conciliation Officer and seven days
after the conclusion of such proceedings.

These provisions do not prohibit the workmen from going on strike but require them to fulfill the
conditions before going on strike. These provisions apply to a public utility service only and not to a
non- public utility service. With regards to Notice of Strike, notice within six weeks before striking is
not necessary where there is already a lock-out in existence. Secondly, notice may be given by the
Trade Union or representatives of the workmen to do so. Thirdly, a notice of strike shall not be
effective after six weeks from the date it is given. The strike can take place only when 14 days have
passed but before 6 weeks have expired after giving such notice.

Notice of strike shall be given by such number of persons to such person or persons in such manner
as may be prescribed by the President or Secretary or officebearer of a registered Trade Union or
federation. Where there is no registered Trade Union of workmen by at least seven representatives
of workmen duly authorized in this behalf at a general meeting specifically held for the purpose. The
object of giving notice of strike is to enable the other party to make amends or to come to terms or
redress the grievance or to approach the authorities to intervene and stop, if it is possible the
threatened action.

Section 23: for public utility and non public utility services:

General prohibition of strika and lockouts:

A strike in breach of contract by workmen and lock-out by the employer is prohibited in the following
cases: (i) During the pendency of conciliation proceedings before a Board and seven days after the
conclusion of such proceedings; (ii) (During the pendency of conciliation proceedings before a Labour
Court, Tribunal or National Tribunal, and two months after the conclusion of such proceedings; (iii)
During the pendency of arbitration proceedings before an arbitrator and two months after the
conclusion of such proceedings, where a notification has been issued under sub-section (3-A) of
section 10- A, or (iv) During any period in which a settlement or award is in operation in respect of
the maters covered by such settlement or award.

The provisions of section 23 shall apply to all industrial establishments. Section 23 applies to both
public utility service as well as non-public utility service, while Section 22 applies to public utility
service alone. Section 23 does not prohibit a strike or lock-out during the pendency of conciliation
proceeding before a conciliation officer, Section 22 does so.

Write short notes on illegal lockout.

According to Section 24(1) Strike or lock-out shall be illegal if it is:

(1) Commenced or declared in contravention of section 22 in a public utility service;

(2) Commenced in contravention of section 23 in any industrial establishment ( including both
public utility and non-public utility service);
(3) Continued in contravention of an order made by the appropriate Government under section
10(3) or sub-section (4-A) of section 10-A of the Act.

Strike or lock-out in contravention of the provisions of Section 22 or Section 23 of the Act is

declared illegal by Section24 of the Act.

A strike or lock-out which commenced as legal under Section 22 & 23 can be continued unless an
order under Section 10(3) has been passed prohibiting the continuance of an existing strike or lock-
out.

Sub-section (2) of Section 24 of the Act lays down that continuance of strike or lock-out is deemed
to be illegal only if an order prohibiting it is passed under Section 10(3).

Sub-section (3) of Section 24 of the Act provides that a lock-out declared in consequence of an
illegal strike or a strike declared in consequence of an illegal lock-out shall not be deemed to be
illegal. Thus Strike and lock-out shall not be deemed to be illegal if:-

(i) At the commencement they are not in contravention of the provisions of this Act;
(ii) Their continuance has not been prohibited by the appropriate Government under
section 10(3) of the Act;
(iii) A lock-out is declared in consequence of an illegal strike or vice versa.

In Maharashtra General Kamgar Union v. Balkrishna Pen P. Ltd. Court held that when a strike is
commenced before the expiry of 14 days notice, it will be illegal but only for the unexpired
notice period and thereafter, the strike would be legal.

Section 25 of the Act prohibits financial aid to illegal strikes and lock-outs.

(i) Spending or applying money;

(ii) Money spent or applied in direct furtherance or support of an illegal strike or lock-out;
(iii) The strike or lock-out must actually be illegal
(iv) Knowledge on the part of the person expending or applying money that the strike or
lock-out is illegal.

prosecution must prove:-

(a) That the strike or lock-out was illegal;

(b) That the accused had the knowledge that the strike or lock-out was illegal and that the
money spent by him was direct furtherance or support of the same.

(c) That the money was spent by the accused

(penalty 6m with 1k fine)

Whether workers are entitled to wages during illegal lock-out: - In Krishna Sugar Mills v. State
of U.P., this questioned was discussed. The mill was closed for two days consequent to the
alleged assault of officers by some workmen who created a panicky situation. The Tribunal held
that the closure was lock-out which was illegal and unjustified and so workers are entitled to
wages during the lock-out period. The matter was agitated before the High Court which held that
 the lock-out may be sometimes not at all connected with economic demands; it may be resorted
to as a security measure. In this case such a lock-out was declared without giving notice as was
required and that it was unjustified also being a retaliatory measure. So the company was liable
to pay wages during the lock-out period.

Lock-outs', on the contrary, are reactionary by any measures; because their object is to frustrate
this progressive tend in human affairs. To hold down wages to a minimum, workers denied of
equal opportunities for the education of their children, and no savings to fall back upon in evil
times, is surely unjustifiable, and may be rightly called reactionary.

A lockout declared because of the poor financial condition of the company has an obvious
advantage for the employer because it lets him cut his financial losses. During this period, an
employer does not have to pay the labour costs and other variable costs. If the workmen decide
to contest the reasons on which the employer has declared a lockout, there are chances that the
employer might have to end up paying wages for the period of lockout.

Notice of change

Sec 9-A No employer, who purposes to effect any change in the conditions of service applicable
to any workman in respect of any matter specified in the Fourth Schedule, shall effect such
change,-

(a) without giving to the workman likely to be affected by such change a notice in the prescribed
manner of the nature of the change proposed to be effected; or

(b) within twenty-one days of giving such notice: Provided that no notice shall be required for
effecting any such change—

(a) where the change is effected in pursuance of any settlement or award; or

(b) where the workmen likely to be affected by the change are persons to whom the
Fundamental and Supplementary Rules, Civil Services Rules, Civil Services Rules, Revised Leave
Rules, Civil Service Regulations, Civilians in Defence Services Rules or the Indian Railway
Establishment Code or any other rules or regulations that may be notified in this behalf by the
appropriate Government in the Official Gazette, apply.

Power of Government to exempt: Sec 9-B

Where the appropriate Government is of opinion that the application of the provisions of Section
9A to any class of industrial establishments or to any class of workmen may cause serious
repercussion on the industry concerned and that public interest so requires,

the appropriate Government may, by notification in the Official Gazette, direct that the
provisions of the said section shall not apply, or shall apply, subject to such conditions as may
be specified in the notification, to that class of industrial establishments or to that class of
workmen employed in any industrial establishment.

Definition of Closure According to Section 2(cc) of the Industrial Disputes Act,

Closure of an industry means the permanent closing down of a place of employment or part thereof.
The term closure was used in the Act even prior to the insertion of this definition clause but was not
defined as such. This led to divergence in judicial view as to when the closing down of a part of an
establishment constituted closure and when it was an act of retrenchment. This controversy is
resolved by the express terms of the definition clause itself. It is now made clear that closure arises
even if a part of the place of employment is permanently closed down. No industrialist will like to
close down an earning industry, unless there are compelling circumstances to do so.

Various kinds of situations, such as labour trouble of unprecedented nature, recurring loss, paucity of
adequate number of suitable persons for the purpose of management, non-availability of raw-
materials, and insurmountable difficulty in the replacement of damaged or worn-out machinery may
arise in any industry, ultimately forcing its closure.

1. 60 days prior notice to closedown

2. Clear reasons stating to the govt:
Wont apply to
(a) an undertaking in which –
(i) less than fifty workmen are employed, or
(ii) less than fifty workmen were employed on an average per working day in the preceding
twelve months,
(b) an undertaking set up for the construction of buildings, bridges
(2) Notwithstanding anything contained in sub-section (1), the appropriate Government
may, if it is satisfied that owing to such exceptional circumstances as accident in the
undertaking or death of the employer or the like it is necessary so to do, by order, direct
that provisions of sub-section (1) shall not apply in relation to such undertaking for such
period as may be specified in the order

Compensation to workmen in case of closing down of undertaking

Not less than a year, shall be entitled for notice and compensation like that of retrenchment shall not
exceed his average pay for three months.

the employer provides the workman with alternative employment with effect from the date of
closure at the same remuneration as he was entitled to receive

apply, for prior permission at least ninety days before the date on which the intended closure is to
become effective, to the appropriate Government, stating clearly the reasons for the intended
closure of the undertaking and a copy of such application shall also be served simultaneously on the
representatives of the workmen

, after making such enquiry as it thinks fit and after giving a reasonable opportunity of being heard to
the employer, the workmen and the persons interested in such closure may, having regard to the
genuineness and adequacy of the reasons stated by the employer, the interests of the general public
and all other relevant factors, by order and for reasons to be recorded in writing, grant or refuse to
grant such permission

appropriate Government does not communicate the order granting or refusing to grant permission
to the employer within a period of sixty days from the date on which such application is made the
permission applied for shall be deemed to have been granted

refusing to grant permission shall be binding 1 year from date of order

refer the matter to a Tribunal for adjudication, pass award within 30 days
here the permission for closure has been refused, the closure of the undertaking shall be deemed to
be illegal from the date of closure and the workmen shall be entitled to all the benefits under any
law

Where an undertaking is permitted to be closed, workman shall be entitled to receive compensation

which shall be equivalent to fifteen days' average pay for every completed year of continuous service
or any part thereof more than six months.