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RECOGNITION OF A TRADE UNION

Sangeetha Mugunthan♠

INTRODUCTION

The need for recognition of trade unions by employers was felt by the working

class to ensure that appropriate modes of collective bargaining took place and

that the agreements, which were collectively reached, were mutually observed. It

was considered that recognition of trade unions was a step towards securing

reasonable levels of pay and working conditions. This in turn will be achieved if

workers stood united in representing their demands through a trade union, which

is adequately recognised.

It was in the late 1990s that it was realised that trade unions have become

massive bureaucratic bodies with interests and agendas of those who comprise its

membership. However, there is a growing debate as to the extent to which they

represent and pursue the interests of their members. It is often argued that this is

slight and coincidental. Since, the prime focus of this paper is the recognition of a

trade union, the researcher will confine itself within this ambit and not delve into

this area.

There are elements in the discussion that we must think about. For

instance, the argument about whether it is acceptable to require a level of support

from among the whole of a workforce is an idea that has a history. Trade union

organisations are keen to get legislation that gives them the best chance of

winning votes for recognition. This might be a means through which they may

get back into the industries where their support has declined, mainly because

trade union membership never stopped anyone from losing a job when a

♠ IV Year, B.A. LL.B. (Hons), Hidayatullah National Law University, Raipur,

Chattisgarh.

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company was on the down turn. Trade union activism was often a factor that

meant an employee was picked out to be made redundant.

In reality, trade union recognition works as much in the interests of the

employer as it does in the interest of the worker. Where trade unions are

recognised, the whole system of negotiations and deals works within a pattern

that is acceptable to and often largely imposed by the employer. The recognition

of a trade union has several repercussions in defending people on disciplinary

charges, accompanying members in meetings with managers and negotiating local

conditions of service.

DEVELOPMENT OF TRADE UNIONISM

Background Freedom of association has been the corner stone of democratic societies. The

freedom finds its expression in a democratic form of government1. Trade

unionism has been a movement launched against the concentration of economic

power in the hands of a few individuals of society and for the purpose of

promoting the welfare of working class. The trade union movement is not

confined to the premises of one nation or country but it has widened to the

international field as well. It may be desirable to mention that besides trade

unions in specific countries, there is one international organisation of working

class known as International Labour Organisation (ILO) for promoting labour

welfare2.

History of the Trade Union Movement

1 V.L. Allen, Power in Trade Unions, (1954), pp.5-6. 2 C.W. Jenks, The International Protection of Trade Union Freedom , (1957), pp.37-38.

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Modern trade unionism is a product of conditions created by the industrial

revolution. The industrial revolution in Great Britain and later on in other

countries brought about a sudden and drastic change in the economic sphere.

These changes were so sudden that it was difficult to bring about a complete

social, economic and political adjustment. The factory system of production

completely tore the relationship between the capitalist and the labour class

without replacing it with a new one. It subordinated the workers while at the

same time the powers of the masters were considerab ly increased3. The new

economic order that was created was a challenge, which workers sought to meet

through the formation of associations known as trade unions to defend their

living and working conditions.

The theory of free contract, based on free play of human will, did not

take into account the social or economic justice for economically weaker sections

of society. There was much emphasis on individualism, which resulted in free

enterprise. The attitude of non-interference by the state, which regarded industry

as a private competitive effort and on that ground granted it universal freedom,

resulting in formulation of the doctrine of laissez faire.

The movement of trade unionism, which came throughout the world as

the movement of organised labour in the form of combinations and collective

actions has been instrumental in generating the major basis of modern labour law

in the countries. Whether it be called ‘a counter revolution’ as seen by Anglo-

American thinkers4 or it is called ‘repudiation of the individualism of French

revolution’ or the ‘liberalism of the English utilitarian philosophy’ or it is termed

a ‘leader of revolutionary movement’ by communist and socialist thinkers, the

central theme of all trade unions in all the non-communist countries is one

significant object and that is of their desire to redress by combination or

collective action, the economic disparity in bargaining strength from which the

3 Mathur and Mathur, Trade Union Movement in India, pp. 1-2. 4 Alfred A. Knoff, A Philosophy of Labour, (1951), pp. 3-12..

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individual worker suffers as compared to the employer while settling his terms of

employment. To a large extent, the trade unions blend bargaining power to

remove the inequality in collective bargaining, which is vital for improvement of

economic conditions of labour.

Development of Trade Union Law in England

Industrial revolution had first emerged in England. It is therefore essential to

study the trade union development in England. In fact the introduction of

statutory wage fixing and the compulsory payment and acceptance of the rates so

fixed necessarily involved the prohibition of agreements or combinations, either

of workmen or employer, to alter wages or conditions of labour. From 1760

onwards, therefore, numerous statutes were passed prohibiting such

combinations under penalty, first as regards particular trades, and later generally.

Combinations in defiance of these statutes thus involved an agreement to

commit a statutory crime and were, therefore, criminal conspiracies. It is not until

the decay of the system in the eighteenth century, however, that prosecutions for

conspiracies to raise wages appear5.

A long series of enactments of Parliament had made it a criminal offence

for workmen in particular trades to combine in order to change their wages and

conditions. The Combination Acts of 1799 and 1800 heralded a period of

ruthless repression of trade union activity6.

Francis Place, a tailor of Charing Cross and Joseph Hume, a radical

member of Parliament, managed to steer a bill to repeal the Combination Acts

through Parliament as a side issue, without the government fully realising what

5 See, R. vs. Journeyamen Tailors of Cambridge, (1721) 8 Mod. 10. 6 In 1810 some printers engaged on Times newspaper left their work as their

demand for increase in their wages as not met. The result was that they were condemned to terms of imprisonment varying from nine months to two years for ‘combining and conspiring together maliciously to injure their masters’.

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was contemplated; it became law without either a debate or a vote. The sponsors

of the Bill maintained that if freedom to combine were granted, the movement

would soon disappear. The result was, however, quite the contrary.

Encouraged by the repeal of the Combination Laws, new unions were

formed and strikes broke out in many parts of the country. The government felt

alarmed and tried to replace the 1824 Act by a measure more drastic than the

Combination Acts. Ultimately there was a compromise and in 1825 another

enactment was passed which made it possible for the workers to organise without

committing an illegal act. There was however, hardly a thing that the unions

might do to carry out the purpose of their existence without coming into conflict

with the law. The legal vulnerability of the unions soon came apparent in a series

of prosecutions of trade unionists7.

The period from 1850 onwards was a period of industrial expansion and

it gave the trade unions an opportunity to consolidate themselves on sounder

financial basis. The growing power and solidarity of the trade union movement

produced a reaction of alarm on the part of the governing groups and in 1867, a

Royal Commission was appointed to investigate into the organisation and rules

of the unions and to inquire into allegations of intimidation, which they were

accused of encouraging 8.

Between 1871 and 1876, a series of Trade Union enactments were passed

which in their total effect, provided that unions may no longer be declared

unlawful because their objects were in restraints of trade; and that they may 7 The most notable of these was the case of the Dorchester labourers in 1834, for

wholly peacefully attempts to build up a union of agricultural workers at Top puddle, six workers were arrested and sentenced to seven years’ in exile in Australia. This decision caused a great outburst of indignation.

8 The majority report of the said Commission made recommendations that fell short of what the employers had been demanding, whereas the minority report which was in effect acted upon, proposed giving the trade unions legal protection to enable them to safeguard their funds, while leaving them in all other respects voluntary organisations.

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engage in peaceful picketing in labour disputed. Although they might also acquire

a definite civil status by registration with the registrar of friendly societies, the

action was voluntary, and generally they were accorded a large measure of

freedom from legal proceedings in regard to their internal affairs. The period of

nearly 25 years that followed these enactments was not very eventful.

In 1901 came the decision of the House of Lords in the historical case of

Taff Vale Railway Company vs. Amalgamated Society of Railway Servants and it had the

result of undermining completely the position that it was thought had been

gained by the 1871-76 legislation. In that case the railway company had sued the

union of its employees for the losses to the company arising of their action in

supporting and financing a strike of its employees. The House of Lords ruled

that a civil action may be brought against the trade union and that it may be sued

for damages arising out of the actions of its officers or servants during a trade

dispute and be restrained by an injunction from authorising and committing any

action which might be held by the courts to be wrongful. As a result of this

decision no union, of whose members were involved in trade dispute may any

longer be regarded as safe from an action for damages that might completely

denude its funds, even those funds maintained for friendly society purposes. This

decision undermined in one stroke, the whole system of collective bargaining

upon which trade unionism depended and made the effective carrying out of the

main purpose for which trade unions were established impossible. The only

remedy was to get the law changed.

The awakening created by the Taff Vale decision considerably influenced

the general elections in 1906. So much so that a majority of the liberal members

of the Parliament returned were pledged to support labour’s demand for early

legislation to reverse the Taff decision. In 1906, the Trade Disputes Act came to

be enacted which fully recognised inducement to breach of contract and

picketing as legitimate adjuncts to the method of collective bargaining. To quote

Sydney and Beatrice Webb: ‘The Trade Disputes Act which remains the main

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charter of trade unionism, explicitly declares, without any qualification or

exception that no civil action will be entertained against a trade union in respect

of any wrongful act committed by or on behalf of the union; an extraordinary

and ultimate immunity, however great may be the damage caused, and however

unwarranted the act, which most lawyers, as well as employers, regard as nothing

less than monstrous’.

History of the Trade Union Movement in India

The first cotton mill in India was established in 1951 in Bombay and the first jute

mill in 1855 in Bengal. This was the beginning of the modern factory system in

India. After 1851 and 1855, the number of factories began to increase both in

Bombay and Bengal. Prof. S. N. Dhyani has observed that the year 1875 is a

landmark in the history of the trade union movement. For the first time, in India

factory workers united together for securing better working conditions in the

factories.

Factories Act, 1881

The growing consciousness of a common cause for amelioration brought the

w orking class closer despite several hindrances. The Secretary of State for India

was kept informed of all these evils of the modern factory system and the first

Factory Commission was appointed in Bombay in the year 1875 and the first

Factories Act was passed in 1881. The 1881 Act proved highly inadequate and its

provisions regarding protection to child labour and absence of any regulation for

women labour were highly disappointing.

Consequently, another Factory Commission was appointed in 1884. Mr.

Lokhandey organised a conference of workers in Bombay and drew up a

memorandum signed by some 5,300 workers to be presented to the Factory

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Commission. This was the beginning of modern trade union movement in India.

The memorandum submitted and adopted at this meeting demanded a weekly

rest, half an hour’s recess, compensation for disablement, payment of wages not

later than 15 day of the month following the one in which they were earned,

limitation on hours of work from 6.30 A.M. till sun-set9.

Bombay Mill-hands Association and Other Labour Associations

The conditions, however, did not improve and therefore, another representation

was submitted to the government in 1890 reiterating the demands of 1884 and

was signed by about 17,000 workers. In the same year the Bombay mill-hands

association was established under the presidentship of Mr. Lokhandey. This was

the first labour association in India. The Bombay mill-hands association may not,

however, be classified as a genuine trade union. The workers did not have

effective organisation of their own. It had no existence as an organised body

having no roll or membership, no funds and no rules.

A large number of labour associations were started after 1890. For

instance, the Printers’ Union, Calcutta was established in 1905 and the kamgar

hitwardhak sabha and the social service league in 1910. The amalgamated society

of railway servants of India and Burma was registered under the Companies Act.

Its rules were comprehensive and provided for the election of various office-

bearers, the holding of annual general meetings. The society and all other labour

associations established were essentially labour welfare organisations. They may

hardly be regarded as modern trade unions. They wanted to mitigate the evils of

the modern factory system and improve the lot of the workers. They discussed

the problems, represented their case before the government and pressed for

suitable labour legislation. During the said period from 1875 to 1918, the unions

and labour associations mainly relied upon the constitutional method for getting

9 Dr. S.N. Dhyani, Trade Unions and Right to Strike, pp.24-26.

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their grievances redressed. The most notable feature of this period was the

absence of strikes as a means of getting grievances redressed. Strikes during this

period were only exceptional. This period has been characterised as the social

welfare period of our early trade union movement10.

Effects of the First World War

The declaration of war in 1914 had much helped in the growth of labour

movement in India. The entire economic situation was changed. The war and the

consequent shortage of shipping facilities led to restricted imports of

commodities. There was a considerable increase in the prices of essential

commodities like salt, cotton, cloth, kerosene oil, etc. The capitalists were making

enormous profits.

The cost of living was steadily increasing and wages lagged behind. This

economic situation created discontentment and class-consciousness amongst the

workers. Their low standard of living was lowered further. The consequent

distress of workers whose wages were not correspondingly increased generated a

series of strike waves in 1918-19. The strike of Buckingham and Carnatic mills

workers in Madras gave a fillip to the trade union movement in the south. The

strike improved their working conditions. However, they needed proper guidance

and leadership. The non-cooperation movement of Gandhi provided willing

leadership to the labour movement.

The Russian revolution and the establishment of Union of Soviet

Socialist Republic (USSR) had its own favourable effect on our trade union

movement. It brought a ray of hope to the underdog in every country. The

setting of ILO, a tripartite body was also helpful in the organisation of labour

associations in India.

10 G. M. Kothari, A study of Industrial Law, pp. 17-21.

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All these factors brought a change in the moral and mental outlook of the

workers. A large number of trade unions were organised after 1918. The Madras

labour union was the first trade union or modern type in India. Its progress was

mostly because of the spirit and sacrifice of its President B. P. Wadia. By 1920, a

large number of unions were formed. The All lndia Trade Union Congress

(AITUC) was established. It represented the workers interests economic, social

and political whenever and wherever it became necessary. The foundation of the

AITUC marked the first recognition of the common interest of labour

throughout the country. By 1925 the number of unions had increased. During

that period the labour movement was truly united and there was complete

harmony and co-operation among all sections of working class.

Indian Trade Unions Act, 1926

The passing of the Indian Trade Unions Act in 1926 is an important landmark in

the history of the trade union movement in the country. In addition to giving

legal status to registered trade unions, the registration conferred on trade unions

and their members a measure of immunity from civil suits and criminal

prosecutions. Registration also enhanced the status of unions in the eyes of the

public as well as the employers and in this process, even unregistered unions

benefited, and the movement as a whole gained greater confidence of the

workers11.

Thus, the Indian Trade Unions Act, 1926, greatly enhanced the status of

trade unions in the worker’s imagination and in the public minds. Before 1926,

trade unions were treated as illegal bodies. It was only after 1926 onwards that

the movement acquired a big spurt and dynamism in bringing together the

elements, which were hitherto scattered, divided and disunited. It was a great

11 V.V. Giri, Labour Problems in Indian Industry, pp.11-13.

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success, rather a leap forward, which they achieved after a prolonged struggle,

suffering and sacrifice. The Royal Commission rightly observed that:

‘The stimulus given by the Act to trade unionism resulted, not so much

from any rights or liabilities that created, as from the enhanced status in

the statute book’12.

THE PROCESS OF TRANSFORMATION OF THE TRA DE UNIONS’

ACT, 1926

The history of the trade union movement indicates that it did not have to face

the onslaught of legislation as in England. In Great Britain, trade unions were

regarded against the common law. They were looked down as criminal

conspiracies.

The prosecution of B. P. Wadia, the President of the Madras Labour

Union, and the issue of injunction against the Union stunned people not only in

India but also in Great Britain. The demand for the early passing of a trade

unions Act to protect the interests of the growing and infant trade movement

became insistent. The Trade Unions Act was passed in 1926 just eight years after

the organisation of the first trade union in this country. Trade unions and

unio nist could thus secure early, legal protection and social status. It is equally

true that legislation has not so developed in our country as in Great Britain.

After the passing of the Trade Unions Act, 1926, it may be observed that

from criminal and illegal associations trade unions have now become legalised

and recognised institutions, from institutions which were only very small bodies

they have now become gigantic associations, from institutions that were primarily

interested in the advancement of the cause of their own membership they have

12 Report of the Royal Commission on Labour in India, 1931 at p.318.

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now become institutions which are interested in the social, cultural and political

development of the country. This was a remarkable process.

Recommendations of the Royal Commission on Labour

The Royal Commission on Labour examined the working of the Act and found

that the Act had ‘helped to give trade unions stability and enhanced sense of

responsibility’13. It recommended inter alia that the Act must be re-examined in

not more than three years’ time; that all limitations imposed on the activities of

registered unions and their officers and members must be reconsidered. No

significant action was however taken in the matter.

Indian Trade Unions (Amendment) Act of 1947 remained only

on paper

Though the Indian Unions Act, 1926 provided for the registration of trade

unions complying with various specified requirements, it imposed no obligation

on employers to recognise and deal with such registered unions. The Royal

Commission on Labour in India, had also pleaded for the recognition of trade

unions by employers in spirit as well as in letter. The matter figured prominently

on the agenda of successive labour ministers in 1940 and 1941 and of the

meeting of the standing labour committee (1944) and the Indian labour

conference (1945). The result was the adoption of the Indian Trade Unions

(Amendment) Act (XLV) of 1947, which provided for the compulsory

recognition of employers of representative trade unions by order of a labour

court. The Act confers on the executive of recognised trade union the right to

negotiate with the employers in respect of matters connected with the

employment or non-employment, terms of employment and the conditions of

work of all or any of its members. The Amendment Act has not, however, come

13 Report of the Commission, p. 331.

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into force, at all. Similarly the Trade Union Bill, 1950 providing for administrative

controls on trade unions also lapsed.

Recommendations by the National Labour Commission, 1969

The Commission has, inter alia, strongly recommended that:

(1) trade union registration be made compulsory;

(2) the registrar must be time bound to decide the issue of

registration

(3) effective measures must be taken for cancellation if the unions do

not comply with conditions regarding filing of returns or

membership;

(4) trade union recognition by the employers be made compulsory by

Central legislation as specified undertakings;

(5) such recognised unions, must be given statutorily exclusive rights

and facilities like right of sole representation, entering into

collective bargaining agreements, holding discussions and

negotiations, inspection, check-off etc; and

(6) the minority unions must also be allowed to represent workers in

redressal of individual grievances like dismissal, discharge etc.

The suggested measures are likely do promote growth of healthy and

strong trade unionism and eliminate inter-union rivalry to some extent.

Compulsory recognition of one union for one undertaking will make the unions

effective instruments of collective action and give them requisite bargaining

equality.

State Amendments and State Laws

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The Government of Bombay amended in June 1956, the Indian Trade Unions

Act, 1926, in its application to the State of Bombay. The Indian Trade Unions

(Bombay Amendment) Act, 1956 amends s. 33 of the Act of 1926 in order to

enable the registrar of trade unions to make complaints in respect of offences

under s. 31(2) within six months of the on which the offence came to his

knowledge.

State of Madhya Pradesh has also enacted Trade Unions (Amendment)

Act, 1961. Recently Maharashtra has enacted Maharashtra Recognition of Trade

Unions and Prevention of Unfair Labour Practices Act, 1971 which seeks to

fulfill some of the badly needed objectives of recognition of unions and

regulation of unfair labour practices.

RECOGNITION OF TRADE UNION

The Trade Unions Act, 1926 however, was conspicuously silent with regard to

provisions regarding compulsory recognition of the unions by employers for the

purposes of negotiation and bargaining on account of employers’ stiff opposition

who were not still reconciled with the trade unions.

The Trade Unions Act, 1926, covers mainly three sets of matters, namely,

the conditions governing registration of trade unions, the obligation to which a

trade union is subjected after registratio n and the rights and privileges accorded

to registered unions. The Act, however, was amended by the Indian Trade

Unions (Amendment) Act, 1928, defining the procedure regarding appeal against

the decision of a registrar refusing to register a trade union or withdrawing

certificate of registration. It would not be out of place to state at this stage, that

the trade union law in India made no provision with regard to compulsory

recognition of unions of workers by their employers for the purposes of

negotiation or settlement of disputes and thereby deliberately created

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unbridgeable gulf which is constantly creating acrimony, fear and war of nerves

between the labour and capital.

It may be desirable to mention that though the Trade Unions Act, 1926

provided for the registration of trade unions complying with various specified

requirements, it imposed no obligation on employers to recognise and deal with

such registered unions. The Royal Commission on Labour in India, pleaded for

the recognition of unions by emplo yers in spirit as well as in letter. But

throughout the ‘thirties’ the question of recognition proved to be a recurring

cause of friction between the employers and organised labour, and the

advisability of amending the Trade Unions Act, with a view to imposing on

employers a statutory obligation to recognise and deal with such trade unions

satisfying certain prescribed conditions, figured prominently on the agenda of

successive Labour ministers conference held in 1940 and 1941 and of the

meetings of the standing labour committee (1944) and the Indian labour

conference (1945). The result was the adoption of the Indian Trade Union

(Amendment) Act XLV of 1947, which provided for the compulsory recognition

by employers of representative trade unions by order of a labour court. The Act

confers on the executive of a recognised trade union the right to negotiate with

employers in respect of matters connected with the employment or non-

employment, terms of employment and the conditions of work of all or any of its

members. Finally, the Act defines certain practices, as unfair on the part of a

recognised trade union and certain others as to be unfair on the part of an

employer, and requires both to desist from such practices under threat of

withdrawal recognition on application to the Labour Court by the Registrar or

the employer in the case of the former and a fine of upto Rs. 1,000 in the case of

the latter. Unfair practices include participation, support or instigation of an

irregular strike, submission of returns, containing false statements, discharge or

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discrimination against any officer of a recognised trade union. The Amendment

Act has not, however, come into force at al114.

In the absence of enforcement of the said amendment of the Act

regarding recognition as technically there is no provision in the Trade Unions Act

for recognition. However, in actual practice, the employers accord recognition to

the trade unions following procedure contained in the Code of Discipline ratified

by all Central Employers’ and Workers’ Organisations at the 16 session of the

Indian Labour Conference held in May, 1958, and negotiate with the trade unions

for settlement of industrial disputes to restore and maintain industrial peace in

their establishments.

Definition of Recognition

A union must be recognised before it may effectively represent any employees15.

Once a union is recognised it serves as the bargaining agent for the workers in a

particular bargaining unit16. An employee may not circumvent the union17,

because recognition entails willingness ‘to negotiate with a view to striking a

bargain and this involves a positive mental decision’18.

Need for recognition

Recognition of trade union is the backbone of collective bargaining. It has been

debated time and again. But inspite of the government stated policy to encourage

trade union there is no enforced central legislation on this subject. There are

14 G.M. Kothari, A Study of Industrial Law, pp.88-89. 15 John Bowers, Employment Law, 450 (5th ed. 2000). 16 Ibid. at 451. 17 I.T. Smith & Gareth Thomas, Industrial Law, 558–59 (7 th Ed. 2000). 18 Definition of Collective bargaining as the ‘performance of the mutual obligation

of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment’.

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however voluntary code of discipline and legislations in some states. In the

absence of any central legislation, management in several states have refused to

recognise trade union mainly on five grounds:

(1) most of the office bearers of the union were outsiders19;

(2) the trade union keeps outsiders disapproved by management and

particularly politicians and ex-employees20;

(3) the union consisted of only small number of employees;

(4) there were in existence many rival unions; and

(5) the trade union was not registered under the Trade Unions Act,

192621.

However none of these objections are maintainable because to accept the same

would amount interference in the functioning of the Trade Unions. Be that as it

may, the refusal by employers to recognise or bargain with unions has been the

major obstacle to the healthy growth of trade union and collective bargaining22.

Role of ILO in recognition of Trade Unions

At an international level, the concern felt by the ILO for evolving an

international instrument for recognition of trade unions resulted in ILO

Convention No. 87 on ‘freedom of association and protection of the rights to

organise’ in 1948 and Convention No. 98 concerning the right to organise and

bargain collectively in 1949. The former states that:

‘Workers and employers, without distinction whatsoever, will have the

right to establish and, subject only to the rules of the organisation

concerned, to join organisation concerned, to join organisation of their

own choosing without previous authorisation. The Convention

19 Paramount Films India Ltd. vs. Their Workmen (1950) L.L.J. 690. 20 Report of Royal Commission of Labour, (1931) p. 325. 21 Ibid. at p.326. 22 Suresh C. Srivastava, ‘Trade Unionism in India’, Review of Contemporary Law,

Brussels and Paris, 1970, p. 83.

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empowers the workers organisation to frame their constitution, to elect

representatives and among others to organise their activities. To establish

and join federation, Convention, art. 8 require that workers and

employers and their respective organisations, like all other, will respect

the law of the land. The law of the land shall not be such as to impair nor

shall it be so applied as to impair, the guarantees provided for in the

constitution’.

The latter confers protection to workers against acts of anti-union

discrimination in respect of their employment. The protection is, directed in

respect to acts calculated to:

(1) make the employment of a worker subject to the condition that

he will not join a union or may relinquish trade union

membership; and

(2) cause the dismissal, of or otherwise prejudice a worker by reason

of union membership or because of his participation in union

activities outside working hours.

Constitution and Recognition of Trade Unions

Whether there exists a right for a trade union to be granted recognition to trade

unions within the meaning of Constitution of India, art. 19(1)(c) is a fundamental

right or not is answered in the negative23 because the right to form association

does not carry with it the concomitant right24. The withdrawal of recognition25

does not infringe the fundamental rights guaranteed under the Constitution of

India, art. 19(1)(c). 23 A.C. Mukerjee vs. Union of India (1972) 2 L.L.J. 345; M.A. David vs. K.S.E. Board

(1973) 3 L.L.J. 466 (Kerala); Tamil Nadu Electricity Board Accounts Executive Staff Union vs. Tamil Nadu Electricity Board, Madras (1980) 2 L.L.J.

24 All India Bank Employees Association vs. National Industries Tribunal (1961) 1 L.L.J. 375; Raghubir Dayal Jai Prakash vs. Union of India 1961 AIR (SC) 363; D.A.V. College Jullunder vs. State of Punjab 1971 INDLAW SC 638, 1971 AIR(SC) 1737.

25 M.A. David vs. K.S.E. Board (1973) 3 L.L.J. 466 (Kerala).

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Conditions for Recognition

Trade Unions (Amendment) Act, 1947, s. 25D provides that a trade union will

not be entitled for recognition by order of a Labour Court under s. 25E unless it

fulfills the following conditions, namely:

(1) that all its ordinary members are workmen employed in the same

industry or in industries closely allied to or connected with

another;

(2) that it is representative of all the workmen employed by the

employer in that industry or those industries;

(3) That its rules do not provide for the exclusion from membership

of any class of the workmen referred to in cls. (b);

(4) that its rules do not provide for the procedure for declaring a

strike;

(5) that its rules provide that a meeting of its executive will be held at

least once in every six months; and

(6) that it is a registered trade union and that it has complied with all

provisions of this Act.

The aforesaid provisions of the Act raise various problems

(1) Can an employer voluntarily recognise a union which is not

registered under the Act which is in fact a majority union?

(2) Can an employer be compelled to recognise more than one

union?

Notwithstanding the relative importance of these questions and rather

unsatisfactory answer than we get from the statute, the significance of Trade

Unions (Amendment) Act, 1947, must not be overlooked. But even this might

not be put into force.

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Re-recognition of Trade Unions

The Trade Union (Amendment) Act, 1947, s. 28H permits the registered trade

union whose recognition is withdrawn under sub -s. (3) of s. 28G to make an

application for re-recognition after six months from the date of withdrawal of

recognition.

CASE LAW ANALYSIS OF THE REGULATION OF T RADE UNION

LAW IN INDIA

The General Secretary, Rourkela Sramik Sangh vs. Rourkela Mazdoor Sabha and others26,

is a relevant case on the point. In this case Rourkela Sramik Sangh had addressed

a letter on 09 October 1989 to the Implementation and Evaluation Officer-cum-

Labour Commissioner, Orissa, Cuttack intimating him that as per the Code of

Discipline it had called upon the Rourkela Steel Plant to recognise it as a sale

bargaining agent in the plant. Receiving no response appellant had further

requested the labour commissioner to pass orders for immediate verification of

the membership of all trade unions operating in the said plant and to recommend

for recognition, the Union having majority of the membership.

In pursuance of the same, the deputy labour commissioner passed an

order on 14 December 1989 calling upon the different trade unions to produce

the necessary records within ten days of the receipt of the notice. These orders

passed by the labour commissioner and deputy labour commissioner were

challenged by the first respondent-Rourkela Mazdoor Sabha which is a rival

union in the plant by way of a writ petition in the High Court of Orissa.

It was observed by the Supreme Court that the High Court had erred in

allowing writ petition filed by the first respondent and dismissing the appellant’s

26 1991 INDLAW SC 263, 1991 AIR(SC) 1250, per Sawant J.

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writ petition. We, therefore, set aside the decision of the high court and direct the

deputy labour commissioner to complete the process of verification of

membership and the labour commissioner to complete the proceedings of

recognition as expeditiously as possible and preferably within four months from

the receipt of this decision. Thus the appeal was allowed.

In Automobile Products of India Employees’ Union vs. Association of Engineering

Workers,27 where the industrial court issued order granting recognition under the

aforementioned enactment to the appellant-union by following the method of

ballot, the Supreme Court observed that the court ignored in particular the

mandatory provisions of ss. 10, 11, 12, 14 and 19. The consent of the parties to

follow a procedure, which is against the mandatory provisions of the Act, may

not cure the illegality. The recognition or derecognition of a union under the Act

is not a matter which concerns only the contesting unions or its members. It is a

matter of utmost importance to the interest of all the workmen in the

undertaking concerned and to the industry and society in general. No union is

entitled to be registered as a recognised union under the Act merely because it

satisfies the membership qualification. The industrial court is forbidden from

granting recognition to a union whatever its membership, if the court is satisfied

that it is disqualified for reasons mentioned in s. 12, or does not satisfy

conditions mentioned in s. 19. The court observed that the order of the

Industrial Court granting recognition by following the method of ballot is prima

facie illegal being in breach of the provisions of the Act.

In Association of Engineering Workers vs. Dock Yard Labour Union and Others28,

it has been observed by the Supreme Court that the Maharashtra Recognition of

Trade Union and Prevention of Unfair Labour Practices Act, 1971, s. 11 provides

for making an application for recognition of a union. The plain language of this

27 1990 SCC 293. 28 1995 SCC (L&S) 137, Automobile Products of India Employees Union vs. Association of

Engineering Workers, Bombay, (1990) SCC (L&S) 293, followed.

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provision makes crystal clear that the requirement for recognition is that the

union must have for a period of six months immediately preceding the making of

an application, a number of not less than 30 per cent of the total number of

employees employed in the said undertaking. Where the industrial court is

satisfied that the conditions requisite for registration specified in s. 11 are

satisfied then the industrial court has to grant recognition to the union and issue

a certificate in that behalf in the prescribed form.

In Association of Chemical Workers vs. S. D. Rane and others29, where the

appeal by special leave arose from the order of the Division Bench of the

Bombay High Court. The appellant is a rival trade union under M/s. Chemicals

and Fibres of India Ltd. The industrial court in the order had pointed out that

the total employees on 15 June 1981 were 811 and the respondent-union had a

strength of 448 as against rival union having strength of 241. Thus, it was

observed to be recognised union.

In International Airport Authority of Indian Workers Union vs. International

Airports Authority of India and others30, where a dispute arose between two rival

unions, one International Airports Authority of Indian Workers Union and the

other International Air port Authority Employees Union and reached this Court

routing through High Court for recognition as majority union. One union did

not participate in the elections on ground of seeking recognition in court. It was

observed by the Supreme Court that in the circumstances of the case it is just and

proper to hold fresh elections to determine the majority character of the union

which may be recognised by the International Airport Authority of India.

29 1996 SCC (L&S) 759, Automobile Products of India Employees Union vs. Association of

Engineering Workers, Bombay, (1990) SCC (L&S) 293 and Association of Engineering Workers vs. Dock Yard Labour Union and others1995 SCC (L&S) 137. These cases were considered.

30 1993 SCC (L&S) 155.

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In D. K. Changani and others vs. Nitya Ranjan Mukherjee and others31, where

appeal by special leave arose from the order of the Calcutta High Court. The

claims for recognition of rival union Geological Survey of India Employees’

Association were considered. After making reference of the aforementioned rules

and due consideration the Supreme Court observed that if there are more than

one rival unions or the service employees, the Government of India had evolved

a policy as to how the service Associations require to be recognised by the

appropriate authority must represent the interest of the members or the

respective unions. It would be open to the appropriate union to approach the

government in light of the above rules and seek recognition in accordance with

law to avoid any future litigation in this behalf. The appeal was accordingly

disposed of.

In Food Corporation of India Workers Union vs. Food Corporation of India and

Another,32 the Supreme Court observed that it is the appellant-union who was a

party in earlier proceedings which resulted in the decision of the Supreme Court

in Workmen vs. Food Corporation of India33, the appellant claims to be a recognised

trade union. The first respondent-management, stated that the appellant was a

recognised Union till 1984 and not thereafter, since no recognition was given to

the union dealing with contract labour. It is so stated in the addidonal affidavit

filed by the first respondent dated 17 July 1995. The appellant in reply dated 18

July 1995 asserted that it is the only relevant trade union, representing the

handling, loading-unloading mazdoors; contract labour, direct payment or

departmental employees employed by first respondent in the whole of India. The

appellant has been representing, the abovementioned workers for more than

three decades. It also appears from the papers filed by the appellant that at

various stages negotiations carried on between the appellant-union and the

31 1997 SCC (L&S) 352. 32 1996 SCC (L&S) 1255. 33 1985 SCC (L&S) 420.

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respondent. So it may not be said that the petitioner is not a valid or recognised

trade union.

Rights of Trade Unions in India

The trade union rights in our country are found scattered in various laws,

voluntary measures like the Code of Discipline and the constitutional provisions

under the Constitution of India, art. 19. These trade union rights may be divided

into the following categories:

(1) right of freedom of speech and expression which includes right of

picketing34 and demonstrations35;

(2) right regarding the formation and the registration of the trade

union;

(3) right regarding the recognition of the trade union by the

employers;

(4) Right regarding collective bargaining and collective actions;

(5) Right regarding conduct and functioning of the trade union; and

(6) Miscellaneous rights.

Right to form a Trade Union – A Constitutional Right of

citizens of India

The right to form and continue36 a trade union is a fundamental right guaranteed

under the Constitution of India, art. 19(1)(c), which may only be subjected to

reasonable restrictions in the public interest as provided by art. 19(1)(6) of the

34 In re Vengan AIR 1952 Mad 95; Raj Narain vs. State AIR 1961 All 531; Damodar vs.

State AIR 1951 Bom. 459. 35 Kameshwar vs. State of Bihar AIR 1956 All 57. 36 Kulkarni vs. State of Bombay AIR 1951 Bom. 106; Row vs. State of Madras AIR 1951

Mad 147; Uttar Pradesh Shramik Sangh vs. State of Uttar Pradesh AIR 1960 All. 45 at 49.

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Constitution37. Provision is also made in the Indian Trade Unions Act, 1926 for

providing them immunities from criminal prosecution in certain circumstances,

which further ensure the safe conduct of the trade unions. Under the various

laws, the trade unions are required to get themselves registered for certain

purposes. Every trade union is required to register itself under the Trade Unions

Act in order to operate as a trade union.

Recognition of Trade Unions by Employers

After the registration of the trade union, the question of its recognition by the

employer comes to the forefront in as much as if it is recognised by the employer

for the purpose of collective bargaining, then it will have certain privileges and an

opportunity to fulfill its role. There is no provision in the Indian Trade Unions

Act or Industrial Disputes Act, 1947, the only two central enactments in this

respect in the country regarding recognition of the trade union by employers.

No union registered or otherwise may lay claim to recognition by the

management for participation in negotiations as a matter of a legal right.

However it may not be denied that fair play requires the management to consider

grant of recognition when a body of persons legitimately expects to be affected 38.

This right of recognition has to be secured by the trade unions by raising an

industrial dispute. The Code of Discipline regulates this aspect, though not on a

statutory level. The National Commission on Labour has recommended such a

statutory right for unions. Non-recognition of a trade union for collective

bargaining constitutes an unfair labour practice. Provisions have however been

made in the State of Maharashtra through the Maharashtra Recognition of Trade

Unions and Prevention of Unfair Labour Practices Act, 1971.

37 Ramkrishnaiah vs. Dstrict Board AIR 1952 Mad. 253; Sitharamachary vs. Senior Deputy

Inspector AIR 1958 AP 78. 38 Indian Airlines Technical Assts. vs. Indian Airlines and others 1995 LLJ 578 (AP).

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Code of Discipline and Trade Union Recognition

With the evolution of the voluntary measures in the nature of the Code of

Discipline in the industry, an attempt has been made to make a provision for

recognition of the unions by the employers. Thus under the Code of Discipline

the management has agreed to recognise in accordance with the criteria evolved

at the 16 Session of Indian Labour Conference held in May 1958. The criteria for

recognition of a union has been that the membership of the union must cover at

least 15 per cent of the workers in the establishment and for this purpose the

membership has to be counted only of those persons who have paid their

subscription for at least three months during the period of six months

immediately preceding the reckoning. When there is more than one union, a

union claiming recognition must have been functioning for at least one year after

registration. The recognition is generally given for a period of two years. It there

is more than one union in an industry or establishment, the one with the largest

membership must be recognised. It is a condition of recognition that the unions

must observe the provision of the Code of Discipline. These criteria for

recognition of unions have created many problems and in the absence of any

statutory sanction underlying the Code of Discipline in actual practice, the

recognition of a union by employers has lot much of its significance.

Rights of the Recognised Unions under the Code of Discipline

Under the Code of Discipline, the recognised unions have been given certain

rights in preference to unrecognised unions. These rights are:

(1) to raise issue and enter into collective agreements with employers

on general questions concerning terms of employment and

conditions of service of workers in an establishment of in the case

of a representative union, in an industry in a local area;

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(2) to collect membership fees/subscriptions payable by members to

the union within the premises of the undertaking;

(3) to put up or cause to put up a notice board on the premises of

the undertaking in which its members are employed and affix or

cause to be affixed thereon notices relating to meeting, statements

of accounts of its income and expenditure and other

announcements which are not abusive, indecent or inflammatory

or subversive of discipline or otherwise contrary to the Code;

(4) for the purpose of prevention or settlement of an industrial

dispute:

(a) to hold discussion with the employees who are members of the

union at a suitable place or places within the premises of

office/factory/establishment as mutually agreed upon;

(b) to meet and discuss with an employer or any person appointed by

him for the purpose, the grievance of its members employed in

the undertaking; and

(c) to inspect to prior arrangement, in an undertaking, any place

where any member of the union is employed;

(5) to nominate its representatives on the grievance committee

constituted under the grievance procedure in an establishment;

(6) to nominate its representative on joint management councils, and

(7) to nominate its representative on non-statutory bipartite

committees for instance production committee, welfare

committee, canteen committee, house allotment committees set

up by managements.

LEGAL CHARACTER OF A REGISTERED TRADE UNION

Is registered trade union a legal person? The answer may be given in affirmative

in view of the provisions of the Trade Unions Act, 1926, s. 13. It may be pointed

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out that only a trade union which has been registered under the provisions of the

Trade Unions Act, 1926, receives a legal status and thereby becomes legal person

and not unregistered trade union, In fact, certain advantages, and rights emanate

from the registration of a trade union under the provisions of the Trade Unions

Act, 1926. When a trade union is registered all communications and the notices

to a registered trade union may be addressed to its registered office. The

registered office means that office of a trade union, which is registered under this

Act as the head office thereof39. Notice of any change in the address of the head

office will be given within 14 days of such change to the registrar in writing and

the changed address will be recorded in the register of the trade unions to be

maintained in the registrar’s office40.

Incorporation of Registered Trade Unions

According to the Trade Unions Act, 1926, s. 13, every registered trade union will

be a body corporate by the name under which it is registered, and will have

perpetual succession and a common seal with power to acquire and hold both

movable and immovable property and to contract and shall by the said name sue

and be sued.

The analysis of the aforementioned provisions would make it clear that

when a trade union is registered, it becomes a body corporate meaning thereby

an artificial legal person. By virtue of its legal entity certain rights are accorded.

Duties are imposed and certain powers are conferred upon which may be called

advantages of registration in an ordinary sense. Thus, the following are the

advantages or effects of registration of trade union:

(1) every registered trade union becomes a body corporate by the

name under which it is registered. It means that the trade union,

after registration under this Act, becomes artificial legal person 39 The Trade Union Act, 1926, Section 2 (d). 40 The Trade Union Act, 1926, Section 12.

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having its separate existence from its members of which it is

composed41;

(2) an incorporated trade union never dies. It becomes an entity with

perpetual succession. The members of the trade union change but

the trade union remains unchanged. The retirements, withdrawal

or expulsion and death of individual members do not affect the

corporate existence of the trade union;

(3) the trade union will have a common seal after its registration.

(4) the trade union is empowered to acquire and hold both movable

and immovable property in its own name. In State Bank of India

Officers’ Association vs. Commissioner of Wealth Tax42, the High Court

of Madras observed that a registered trade union is an ‘individual’

as envisaged by Wealth Tax Act, 1957 and liable to pay wealth

tax. Expression ‘individual’ occurring in the Wealth Tax Act,

1957, s. 3 would not only take in an individual but also a plurality

of individuals which in turn would include a body or group of

persons forming a single collective unit knit together by ties of

common aim and joint interests who owned property;

(5) by virtue of its legal personality, the trade union acquires power to

contract in its own name;

(6) the trade union, being a body corporate, may sue and be sued in

its own name; and

(7) The registered trade union is granted immunity from criminal43

and civil44 liability in certain cases singled out under the provisions

of the Trade Unions Act, 1926.

It would not be out of place to say that the abovementioned advantages

solicit the members of an association to get it registered as trade union under the 41 Ramendra Nath Roy Chowdhary vs. State of Bihar & Others, (1954-55) F.J.R. 528. 42 (1986) LLJ 267, per Ramanujam, J. 43 The Trade Unions Act, 1926, Section 17. 44 Ibid., s. 18.

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provisions of the Trade Unions Act, 1926. Although the trade union becomes a

body corporate after its registration just like a company after its incorporation

under the provisions of the Companies Act, 1956, the trade unions may not be

registered under the Companies Act, 1956, or any other enactment.

Trade Unions Act, 1926, s. 14 expressly provides that the following Acts

will not apply to any registered trade union:

(1) the Societies Registration Act, 1860;

(2) the Co-operative Societies Act, 1912; and

(3) The Companies Act, 1956.

The provisions of the said Acts will not apply to any registered trade

union and if any trade union is registered under any such Act it will be void. The

reason is simple that where an association of persons is registered under the

Societies Registration Act, 1860, it becomes society, if registered under the Co-

operative Societies Act, 1912, it becomes a co -operaive society, and if it is

registered under the Companies Act, 1956, it becomes a company and not a trade

union. Therefore, the trade unions must be registered under the Trade Unions

Act, 1926, in order to get advantages referred to above. The rights and

advantages which are available to the registered trade unions under the various

provisions of the Trade Unions Act, 1926, are not available to a union which is

not registered in accordance with the provisions of this Act. In other words,

effect of non-registration of a trade union is non-availability of advantages and

privileges which are conferred upon a registered trade union under the provisions

of the trade unions Act, 1926. It may be concluded that a trade union after

registration becomes a legal person and so long as its registration certificate

exists, it remains a body corporate.

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In Chemosyn Pvt. Ltd. and others vs. Kerala Medical and Sales Representatives

Association45, the question for consideration was whether a trade union, registered

under Trade Unions Act, 1926, is amenable to writ jurisdiction under the

Constitution of India, art. 226. It was observed that applying the tests that are

well established it may be seen that a trade union registered under the Trade

Unions Act, 1926 is neither an instrumentality nor an agency of the state

discharging public functions or public duties. A trade union is defined in s. 2(h)

of the Act. The state has no deep or pervasive control or dominion in the

composition or functions of the union. There need not be any substantial

financial assistance by the government. A trade union is not a statutory body. It is

not created by statute or incorporated in accordance with the provisions of a

statute. The activities of the trad e union are not closely related to governmental

functions and are not of public importance. The privileges conferred or the

immunities enjoyed by the trade union do not impose any public duties on the

part of the union. There is no scope for expanding the content of the expression

‘authority’ to cover a trade union. Therefore, the trade union is not amenable to

writ jurisdiction under the Constitution of India, art. 226.

CONCLUSION

Sound trade union activity has the potential for generating a healthy circle of

better labour productivity, increasing earnings of labour, expanding their

purchasing power, improving their working and living conditions, increasing

efficiency, and having more production.

Such a state of affairs would be beneficial not only to workers, but also to

the industry and to the nation. The government and many enlightened employers

do appreciate the importance of the role of trade unions, and their policy is one

of encouragement and assistance to the trade unionism. The future of trade

45 (1988) LLJ 43 (Kerala).

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unionism in Indian depends mainly upon the effort of the unionists themselves.

For developing internal vitality, a strong and stable trade union movement is

essential for the proper functioning of industry.

Multiplicity of unions in the same plant leads to inter-union rivalry that

ultimately cuts at the root of the trade union movement. It weakens the power

for collective bargaining and reduces the effectiveness of workers in securing

their legitimate rights. Therefore, there must be only one union in one industry.

Till recently, the employers refused recognition to the trade unions either

on the basis that unions consisted of only a minority of employees or two or

more unions existed. The Trade Unions Act, 1926 is completely silent on the

question of recognising a trade union for the purpose of collective bargaining.

Such a provision exists, however, in Annexure A of the Code of Discipline,

which is a voluntary measure. This annexure lays down the following criteria for

recognising a trade union:

(1) where there are more than one union, a union claiming

recognition must have been functioning for at least one year after

registration. Where there is only one union, this condition would

not apply;

(2) the membership of the union must cover at least fifteen per cent

of the workers in the establishment concerned. Membership

would be counted only of those who have paid their subscription

for at least three months during the period of six months

immediately preceding the month of reckoning;

(3) a union may claim to be recognised as a representative union for

workers in all establishments in an industry in a local area if it has

a membership of at least 25 per cent of the workers of that

industry in that area;

(4) when a union has been recognised, there must be no change in its

position for a period of two years;

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(5) where there are several unions in an industry or establishment, the

one with the largest membership must be recognised;

(6) a representative union for an industry in an area must have the

right to represent the workers in all the establishments in the

industry, but if a union of workers in a particular establishment

has membership of 50 per cent or more of the workers of that

establishment, it must have the right to deal with matters of

purely local interest such as, for instance, the handling of

grievances pertaining to its own members. All other workers, who

are not members of that union might either operate through the

representative union for the industry or seek redress directly; and

(7) only unions that observe the Code of Discipline should be

entitled to recognition.