INDUSTRIAL DISPUTES

Avoiding disputes within workforce

Good relations between owner and your staff are key to creating a productive working environment. You should therefore seek to encourage a workplace culture that prevents conflicts from arising.

If you fail to do so, collective grievances could arise, which could in turn lead to workers making tribunal claims or calling for industrial action.

Informing and consulting workers and their representatives

It is good practice for you to develop channels for informing and consulting your workforce and/or their representatives on employment matters and business developments. Indeed, in some cases, you are legally obliged to inform and consult them, eg during collective redundancy situations.

Depending on the size of the business, you could set up:

• regular consultations with a recognized trade union - an effective working relationship with union officials can pick up problems before they escalate
• a staff forum or joint working group to pass on information to, collect ideas from and consult with workers
• an employee consultative body to discuss major issues as they arise
• team and group meetings and feedback sessions

Many employers, especially those which recognize trade unions, have written procedures in place to discuss collective grievances with representatives and other significant issues affecting all or part of the workforce. Procedures are important as they can help you to address problems at an early stage.

If you already have such procedures, you should ensure you follow them effectively and consistently.

If you don't have such procedures, you could consider putting some together in consultation with workers and/or their representatives.

The proposals for  industrial disputes

 The industry wishes to explore the greater or better use of mediation and compromise agreements to resolve workplace disputes between employee and employer, but, as yet, has no firm proposals in these areas. The main proposals are:

Reducing the number of disputes which go to tribunal:

·         Requiring all claims to be submitted to the Advisory, Conciliation and Arbitration Service -ACAS

·         Giving ACAS the right to offer conciliation before the claim proceeds in most cases

·         Increasing the power of tribunals to strike out cases

·         Making it easier for respondent employers to request that cases be struck out

·         Increasing the use and size of deposits in tribunal cases

·         Increasing the cap on costs awards to increase the risks involved in pursuing weak claims/responses

Encouraging settlements of claims

·         More information about the nature of the claim to be disclosed at the outset, including statements of loss by the claimant

·         Encouraging the acceptance of “offers to settle” made during the tribunal process

Shortening tribunal hearings

·         Witness statements to be “taken as read” in all hearings

·         Withdrawal of the payment of expenses to witnesses attending tribunals, thereby seeking to reduce the numbers of witnesses called

·         Extending the range of cases where judges can sit alone to include unfair dismissal cases

·         Allowing legal officers (rather than judges) to deal with case management functions

Introduction of the charging of fees into the tribunal system (details subject to further consultation)

Qualification for employees to bring unfair dismissal claims to increase from 1 to 2 year’s continuous employment

Financial penalties to be imposed on employers who breach rights, in addition to the payment of compensation to employees

The role of preventing disputes

Acas is an independent statutory body whose role is to improve working life through better employment relations.Acas can not only help to resolve a dispute once it arises but also helps employers and workers (or their representatives) work together to prevent disputes arising in the first place.Acas delivers workplace training and runs small-business workshops aimed at helping organizations adopt or develop better employment relations practices.

Disputes with your workforce and/or their representatives - and any resulting industrial action - are costly and damaging to both your business and workers.

Therefore, you should seek to avoid any conflict with your workforce arising in the first place. However, if conflict does arise, you should have procedures in place for resolving the source of the conflict as soon - and as amicably - as possible.

This will reduce the financial cost of the dispute, minimize the damage done to employer-worker relations and your business' reputation, and help maintain productivity.

This guide gives advice on how to avoid industrial disputes in the workplace. It also explains the different forms of industrial action and the legal issues that may arise if such action is threatened or actually takes place.

Social Dialogue and Workplace Corporation: 

1. Prepare policy and position papers on social dialogue and workplace cooperation.
2. Plan, organize and conduct training workshops on social dialogue and workplace cooperation for the benefit of workers, employers and their organizations
3. Prepare and disseminate public awareness materials on social dialogue and workplace cooperation among workers, employers and their organizations.
4. Capacity building of the stake holders on social dialogue & workplace cooperation.
5. Liaise with trade unions employer organizations in promoting social dialogue & workplace cooperation
6. Participate in meetings, conferences and workshops concerned with social dialogue and workplace cooperation.

Industrial Disputes Act

The objective of the Industrial Disputes Act is to secure industrial peace and harmony by providing machinery and procedure for the investigation and settlement of industrial disputes by negotiations.Various studies indicate that Indian labour laws are highly protective of labour, and labour markets are relatively inflexible. These laws apply only to the organized sector. Consequently, these laws have restricted labour mobility, have led to capital-intensive methods in the organised sector and adversely affected the sector’s long-run demand for labour. Labour being a subject in the concurrent list, State-level labour regulations are also an important determinant of industrial performance. Evidence suggests that States, which have enacted more pro-worker regulations, have lost out on industrial production in general.

The Industrial Disputes Act (IDA) of 1947. Particular attention has been paid to its Chapter V-B, introduced by an amendment in 1976, which required firms employing 300 or more workers to obtain government permission for layoffs, retrenchments and closures. A further amendment in 1982 (which took effect in 1984) expanded its ambit by reducing the threshold to 100 workers. It is argued that since permission is difficult to obtain, employers are reluctant to hire workers whom they cannot easily get rid of. Job security laws thus protect a tiny minority of workers in the organized sector and prevent the expansion of industrial employment that could benefit the mass of workers

outside. It is also argued that the restriction on retrenchment has adversely affected workplace discipline, while the threshold set at 100 has discouraged factories from expanding to economic scales of production, thereby harming productivity. Several other sections of the IDA allegedly have similar effects, because they increase workers’ bargaining strength and thereby raise labour costs either directly through wages or indirectly by inhibiting work reorganization in response to changes in demand and technology. The Act also lays down

1.   The provision for payment of compensation to the workman on account of closure or lay off or retrenchment.

2.   The procedure for prior permission of appropriate Government for laying off or retrenching the workers or closing down industrial establishments

3.   Unfair labour practices on part of an employer or a trade union or workers.

Applicability

The Industrial Disputes Act extends to whole of India and applies to every industrial establishment carrying on any business, trade, manufacture or distribution of goods and services irrespective of the number of workmen employed therein. Every person employed in an establishment for hire or reward including contract labour, apprentices and part time employees to do any manual, clerical, skilled, unskilled, technical, operational or supervisory work, is covered by the Act. This Act though does not apply to persons mainly in managerial or administrative capacity, persons engaged in a supervisory capacity and drawing executing managerial functions and persons subject to Army Act, Air Force and Navy Act or those in police service or officer or employee of a prison.