Concept of unfair labour practice and the procedure for its redressal under M.R.T & P.U.L.P Act

We are always must reluctant to put any interpretation upon labour legislation is likely to prejudice the rights or welfare of Labour. We are fully conscious of the fact that our legislature has put labour legislation on the statue book primarily for the purpose of redressing the balance between employers and employees and that we would not, unless we are compelled to do so by the clear language used by the legislature put any construction upon any provision of labour legislation which will in any way prejudicially affect their rights. – Chagla C.J.

In India there are several Acts and legislations enacted by the Government of India for regulation of industries in the country. These enactments play a very important role in the country’s overall progress and economic development. These legislations are amended from time to time in accordance with the changing circumstances and environment. Another important aspect of legislations is the industrial relations, which involves various aspects of interactions between the employer and the employees; among the employees as well as between the employers. In such relations whenever there is a clash of interest, it may result in dissatisfaction for either of the parties involved and hence lead to industrial disputes or conflicts. The Industrial Disputes Act, 1947 is the main legislation for investigation and settlement of all industrial disputes. The Act enumerates the contingencies when a strike or lock-out can be lawfully resorted to, when they can be declared illegal or unlawful, conditions for laying off, retrenching, discharging or dismissing a workman, circumstances under which an industrial unit can be closed down and several other matters related to industrial employees and employers.

In the present scenario of increasing demand for labour flexibility by employers, some practices are followed that would legally amount to unfair labour practices (ULPs). The Industrial Disputes Act 1947 has provided against ULPs by employers, workmen and unions. Another important state law protecting against ULPs is the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act 1971 (MRTU & PULP Act). It provides important legal safeguards for workers against victimisation and persecution at the hands of their employers.

“Before adverting to the relevant provisions of the Act , it is necessary to refer to the circumstances which led to passing of the Act. The Government of Maharashtra recognized that the development of strong,

 ..2.. independent and responsible unions and an orderly, rational environment free from unfair labour practices are the two pre-requisites of effective collective bargaining. There was no effective legislation providing for recognition of representative trade unions as exclusive bargaining agent except the Bombay Industrial Relations Act, 1946, which applied only to a few industries. There was also no systematic law to determine and penalise unfair labour practices. The Government of Maharashtra therefore in February 1968 appointed a Tripartite Committee under the Chairmanship of the President, Industrial Court, Bombay, for defining the activities on the part of the employers and workers and their organizations which should be treated as unfair labour practice and for suggesting action which should be taken against employers or workers or, as the case may be, their organizations for engaging in such unfair labour practices. The Committee after detailed deliberations submitted an unanimous report to the State Government. The Committee noticed that the concept of unfair labour practice arose after a long drawn out struggle waged by the trade unions in the West For establishing and establishing the practice of collective bargaining. The emergency of the practice of collective bargaining marks a distinct mile-stone in the progress of the trade union movement. The rise of the practice of collective bargaining has played an extremely important role in the history of industrial relations.

In United States of America after great economic depression of nineteen thirties, the need for specific legislative protection was felt and this need was translated into definite and clear-cut legislative provisions. The provisions intended to remove the hurdles in the way of collective bargaining were summed up in the phrase “unfair labour practices”. Unfair Labour Practices were spot-lighted and the United States Congress proceeded to pass a comprehensive enactment known as National Labour Relations Act, 1935, which is popularly known as “the Wagner Act”. Subsequently the Congress passed a legislation known as “Labour Management Relations Act, 1947”, popularly called the “Taft-Hartley Act”. This legislation made detailed provisions listing the unfair labour practices. Since Independence the Government of India is playing an important role in the shaping of industrial relations in the country. Though several legislation dealing with the Industrial disputes were enacted, these legislation did not deal with the issue of unfair labour practice. Certain general principles of discipline in the industry were agreed upon by the participants at the 15th Indian Labour Conference and a Tripartite Sub-committee was created to study additional questions and develop the materials in the form of a Code. This effort also did not succeed because the Code was merely based on moral sanctions and lacked legislative teeth.

The Committee noticed that in India the system of designating a representative union as a sole bargaining agent has not been legally accepted, existing in some State legislations, notably the Bombay Industrial Relations Act. The

 ..3.. expression ‘unfair labour practice’ has not been used in this country to mean certain activities connected with collective bargaining and in particular, activities calculated to hinder the smooth passage of discovering the collective bargaining agent. The expression is loosely used in decisions of the Industrial Tribunals, Labour Appellate Tribunals, High Courts and the Supreme Court, and refers to unjust, dismissals unmerited promotions, partiality towards one’ set of workers and every form of victimization. The Committee defined which activities on the part of the employers and the workers and their organizations should be treated as unfair labour practice by furnishing separate lists. The Committee was conscious ‘that it is difficult to define the expression unfair labour practice’ and the list could not be exhaustive. The law relating to unfair labour practice in India as gathered from the decisions of the Tribunals and Courts, indicates that it has grown out of the exigencies of the situation and circumstances in specific cases. The Committee felt that to systematize the law relating to unfair labour practice is necessary in the context of the conditions prevailing in this country. Though the expression ‘unfair labour practice’ could not be defined with logical precision for the simple reason that it covers a large category of cases under its umbrella, the Committee felt that a workable description of the expression is necessary

.” The Government of Maharashtra after taking into consideration the report of the Committee decided to provide for the recognition of trade unions for facilitating collective bargaining for certain undertakings and to provide for prevention for certain unfair labour practices. The Government also considered it necessary to constitute an independent machinery For fulfilling the dual purpose of according recognition to unions and of enforcing provisions relating to the unfair labour practices. Accordingly, the State Legislature passed an Act which came into force from February 1, 1972. FEATURES OF THE ACT The Maharashtra Trade Union Prevention of Unfair Labour Practices Act, 1971 (MRTU & PULP Act) is applicable to every industry to which the Bombay Industrial Relations Act and the Industrial Disputes Act (in which the state government is the appropriate government) are applicable. It covers every person defined as an “employee” under the Bombay Industrial Relations Act and as worker under the Industrial Disputes Act. It seeks to:
• provide for recognition of trade unions which will facilitate collective bargaining;
• formalize rights and obligations of unions; • confer powers on unrecognized unions;
• regulate strikes and lockouts by defining the illegality they involve;
• list unfair labour practices and provide for prevention of these;
• constitute relevant labour judiciary institutions to deal with matters arising out of the provisions of the Act.

..4.. THE PREAMBLE TO THE ACT The Preamble to the Act sets out that the legislation was passed to provide for the recognition of trade unions for facilitating collective bargaining and to define and provide for the prevention of certain unfair labour practices. The preamble further sets out that the legislation is also to provide for Constitution of Courts as independent machinery for enforcing the provisions relating to unfair practice and to provide matters connected with the purposes aforesaid. CONCEPT OF UNFAIR LABOUR PRACTICE Section 3(16) of the Act prescribes that ‘unfair labour practices’ means unfair labour practices as defined in Section 26. Section 26 provides that ‘unfair labour practices’ mean any of the practices listed in Schedules II, III and IV of the Act. Schedule II sets out unfair labour practices on the part of the employers and various items under this Schedule have reference to practices which have relation to the Union activities. Schedule III deals with unfair labour practice on the part of the trade unions, while Schedule IV sets out general unfair labour practices on the part of employers.
Item No. 1 of Schedule IV reads as under- “1. To discharge or dismiss employees- (a) by way of victimization; (b) by falsely implicating an employee in a criminal case on false evidence or on concocted evidence; (c) for patently false reasons; (d) on untrue or trumped up allegations of absence without leave; (e) in utter disregard of the principles of natural justice in the conduct of domestic enquiry or with undue haste. (f) for misconduct of a minor or technical character, without having any regard to the nature of the particular misconduct or the past record of service of the employee, so as to amount to a shockingly disproportionate punishment”. The Legislature was conscious that the unfair labour practice set out in Schedules II, III and IV may not be an exhaustive list and from time to time a person may resort to practices which are unfair labour practices and therefore conferred power upon the State Government to add or alter the items in the Schedule after obtaining the opinion of the Industrial Court. Regulation 147 framed by the Industrial Court in exercise of powers conferred under Section 33 of the Act requires the Members of Industrial Court to submit a report upon any unscheduled unfair labour practice which comes to the notice of the President of the Industrial Court to the State Government and on receipt of such report the State Government is entitled to take action under Section 53 of the Act.Section 27 of the Act issues a fiat that no employer or union and no employees shall engage in any unfair labour practice.

(1) In case any person has engaged in or is engaging in any unfair labour practice, filing of complaint by any union or any employee or any employer or any Investigating Officer within ninety days of the occurrence of such unfair labour practice, before the Court competent to deal with such complaint either under section 5, or as the as the case may be, under section 7, of this Act : Proviso stated that, if good and sufficient reasons are shown by the complainant for the late filing of the complaint i.e after the period of ninety days from the date of the alleged occurrence the Court may entertain a complaint.
(2) The decision shall be given by Court on every such complaint as far as possible within a period of six months from the date of receipt of the complaint.
(3) On receipt of a complaint under sub-section (1), the Court may, if it so considers necessary, first cause an investigation into the said complaint to be made by the Investigating Officer, and direct that a report in the matter may be submitted by him to the Court, within the period specified in the direction.
(4) The Investigating Officer may visit the undertaking, where the practice alleged is said to have occurred, and make such enquiries as he considers necessary. He may also make efforts to promote settlement of the complaint While investigating into any such complaint.
(5) The Investigating Officer shall, after investigating into the complaint under sub-section (4) submit his report to the Court, within the time specified by it, setting out the full facts and circumstances of the case, and the efforts made by him in settling the complaint. The Court shall, on demand and on payment of such fee as may be prescribed by rules, supply a copy of the report to the complainant and the person complained against.
(6) If, on receipt of the report of the Investigating Officer, the Court finds that the complaint has not been settled satisfactorily, and that facts and circumstances of the case require, that the matter should be further considered by it, the Court shall proceed to consider it, and give its decision.
(7) The decision of the Court, which shall be in writing, shall be in the form of an order.The order of the Court shall be final and shall not be called in question in any civil or criminal court.
(8) The Court shall cause its order to be published in such manner as may be prescribed. The order of the Court shall become enforceable from the date specified in the order.

(9) The Court shall forward a copy of its order to the State Government and such officers of the State Government as may be prescribed.”

In short, section 28 sets out the procedure for dealing with the complaints relating to unfair labour practices and Sub-section (1) inter alia provides that where any person has engaged in or is engaging in any unfair labour practice, then any union or any employee or any employer may file a complaint before the Court competent to deal with such complaint, Section 5 of the Act prescribes that the Industrial Court shall decide the complaints relating to unfair labour practices except the practices falling in Item 1 of Schedule IV. The practices falling under Item 1 of Schedule IV are dealt with by the Labour Court in accordance with provisions of Section 7 of the Act. POWERS OF INDUSTRIAL AND LABOUR COURTS Section 30 of the Act sets out the powers of Industrial and Labour Courts, while deciding the complaints and Sub-section (1) provides that where a Court decides that any person has engaged in or engaging in any unfair labour practice, then the Court may (a) declare that an unfair labour practice has been engaged in or is being engaged in by that person, and (b) direct all such persons to cease and desist from such unfair labour practice and take such affirmative action as may in the opinion of the Court is necessary to effectuate the policy of the Act. Sub-section (2) of Section 30 confers power upon the Court to pass interim order, including a temporary relief or restraining order as it deems just and proper, including directions to withdraw temporarily the practice complained of pending final decision. The failure to comply with the order of the Court is made punishable by conviction with imprisonment which may extend to three months or with fine which may extend to Rs. 5000/- by provisions of Section 48 of the Act. The MRTU & PULP Act forbids both employers and workers from committing unfair labour practices which are illustratively described in the schedules appended to the Act. The Court will adjudicate on the complaint of such practices within six months from the date of receipt of the complaint. The Act prohibits the employer from interfering with the union organizational activities in any manner and victimizing anybody for legitimate union activities, including participating in legal strikes. The failure of the employers to bargain collectively and in good faith with the recognized union is also an unfair labour practice (Item No.5, Schedule II of the Act). Similarly, the recognized union will be committing an unfair labour practice if it refuses to bargain in good faith (Item No.3, Schedule III of the Act). Schedule IV protects the workers from mala fide actions and victimization by employers such as dismissal, punitive transfers etc. Thus, the law provides both positive and negative rights to both employers and workers to conduct collective bargaining. UNFAIR LABOUR PRACTICE” UNDER INDUSTRIAL DISPUTES ACT The “Unfair Labour Practice” as defined by the I.D. Act in

 ..7.. Section 2(ra) means any of the practices specified in the Fifth Schedule’. When we turn to the Fifth Schedule to the I.D. Act, we find the cataloguing of unfair labour practices on the part of the employers, the trade unions of the employers and on the part of the workmen and trade unions of workmen, which are almost parimateria with lists of unfair labour practices on the part of the employers, on the part of the trade unions and general unfair labour practices on the part of the employers as found in Schedules II, III and IV of the Maharashtra Act as described above. The IDA, sets forth the practices of employers, workers and their trade unions that would be considered “unfair labour practices.” Some of the practices prohibited with respect to employers are as follows: ■Interfering with or restraining workers in the exercise of their right to organize, form, join or assist a trade union. ■ Threatening a worker with discharge or dismissal if the worker joins a trade union. ■ Threatening a lockout or closure if a trade union is organized. ■ Granting wage increases to workers at crucial periods of trade union organization, with a view to undermine the efforts of such organization. ■ Estabilishing employer-sponsored trade unions of workers. ■ Encouraging or discouraging membership in any trade union by discriminating against any worker by discharging or punishing the worker for urging other workers to join a trade union. ■ Changing the seniority rating of, refusing to promote or giving unmerited promotions to workers because of trade union activities. For workers and trade unions, any act employed to coerce workers in the exercise of their right to self-organization or to join trade unions amounts to an unfair labour practice.

COMPRESSION OF PROVISIONS OF THE INDUSTRIAL DISPUTES ACT CONCERNING UNFAIR LABOUR PRACTICES WITH THE PROVISIONS OF THE MAHARASHTRA ACT. “When we keep the relevant provisions of the Industrial Disputes Act concerning unfair labour practices in view and compare these provisions with the provisions of the Maharashtra Act, a clear difference becomes obvious. Section 25-T of the Industrial Disputes Act prohibits an employer or workman or a trade union from committing any unfair labour practice. While so far as Section 27 of the Maharashtra Act is concerned, it prohibits an employer or union or employee from engaging in any unfair labour practice. Consequently the prohibition under the Industrial Disputes Act is against the commission of unfair labour practice which may include the final acts of such commission. While Section 27 of the Maharashtra Act prohibits the concerned party even from engaging in any unfair labour practice. The word `engage’ is more comprehensive in nature as compared to the word `commit’. But even that apart, Section 25-U provided for penalty for committing unfair labour practice and mandates that whoever is guilty of any unfair labour practice can ..8.. be prosecuted before the competent court on a complaint made by or under the authority of an appropriate Government under Section 34(1) read with Section 25-U of the Industrial Disputes Act. So far as the Maharashtra Act is concerned, there is no direct prosecution against a party guilty of having engaged in any unfair labour practice. Such a prosecution has first to be preceded by an adjudication by a competent court regarding such engagement in unfair labour practice. Thereafter, it should culminate into a direction under Section 30(1)(b) or it may be a subject matter of interim relief order under Section 30(2). It is only thereafter that prosecution can be initiated against the concerned party disobeying such orders of the Court as per Section 48(1). Consequently, it cannot be said that the Division Bench of the Bombay High Court was not right when it took the view that the act of engaging in any unfair labour practice by itself is not an offence under the Maharashtra Act while such commission of unfair labour practice itself is an offence under the Industrial Disputes Act.” SOME CASE LAWS In a Bombay High Court in the Murlidhar s/o Atmaram Wani vs Dharangaon Nagarpalika (2008(1) CLR 825) case, the Hon’ble Court held that a litigant should be given an opportunity to prosecute for its remedy on merits rather than rejecting his claims on mere technicalities. In this case, the petitioner was working for the municipal council as a driver on daily wages. He filed a complaint under MRTU & PULP Act 1971, claiming various service benefits including permanency.

The Industrial Court had allowed the permanency benefit to the petitioner, awarded payment of relevant wage rates with retrospective effect and directed the council accordingly. When the council did not comply with the direction of the Industrial Court to grant permanent status to the petitioner and subsequently failed to pay pensionary and other retirement benefits upon his superannuation, the petitioner filed complaints under MRTU & PULP Act. The respondents objected to the complaints on the ground of undue delay without justification. The petitioner replied that the Chief Officer of the council had already paid some part of the benefit by installments and, therefore, he had reason to believe that the rest will also be paid to him. He cited the verbal assurances of the Chief Officer of the council that he would be paid his dues, in due course. The High Court observed that the delay in filing complaints was not on account of either negligence or callousness of the petitioner. The Court further observed that petitioner being a class IV employee belongs to that stratum of the society which cannot be expected to challenge the authority of his employer, more so after being given a verbal assurance by a high ranking official of the employer. A litigant should be given an opportunity to prosecute its remedy on merits because it advances the substantial cause of justice. Delay in the present case has been caused not by the fault of the party but by the circumstances of the case. Therefore, it has to be condoned, and the complaints filed by the petitioner for the ULPs of not

..9.. granting retirement and pensionary benefits as well as permanent status would have to be decided on merits and in accordance with law. In another case, Ratnagar Ramchandra Patil vs Municipal Corporation of Greater Bombay (2008 (1) CLR 923), before the same High Court, a similar judgment was given on 25 February 2008. The Justice BH Marlapalle held that refusing promotion from class IV to class III posts amounts to ULP if the rules of the organisation contain provision for such promotions. The High Court held that it is well settled that to be considered for promotion is a legal right and if the same is infringed due to the inaction or wrong action of the employer, the employees have a right to seek redressal before the appropriate judicial forum. The Industrial Court has made manifest error in dismissing the complaint on reasons that are frivolous, baseless and unconnected with the relief sought. Under the rules of the corporation, most of the class III posts are required to be filled through promotions from amongst the class IV employees if they meet the eligibility criteria. The petitioner cannot pray for being promoted but his claim was required to be considered to a limited extent of directing the corporation to hold him eligible for being considered for promotion. Therefore, the corporation was held to be guilty of ULP. The Court directed that the petitioner be considered as eligible for promotion to the class IV posts. Interestingly, in both cases, the employer, held guilty of ULP, was the local authority.

Raymond Ltd. and Anr. Vs. Tukaram Tanaji Mandhare and Anr. – Mar 9 2011 Issue before court is Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 – Sections 3(5) and 28; Industrial Disputes Act, 1947; Bombay Industrial Relations Act, 1946 – Section 3(13) and 3(14)

This appeal was filed against the impugned judgment of the Full Bench of the High Court of Judicature at Bombay. Petitioners filed complaints under Section 28 read with items 1 (a)(b), (d) and (f) of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 before the Industrial Court/Labour Court for certain reliefs claiming that they were employees of the Respondent company. The Respondent company in all those writ petitions , disputed the status of the employees and had contended in its written statement that there was no relationship of employer – employee with any of the Petitioners. The company had contended that the complainants were employed through the contractors and that the issue regarding maintainability of the complaints would have to be decided by the court. During the pendency of these complaints, the judgments in the case of Vividh Kamgar Sabha v. Kalyani Steel Ltd. (2001) 2 SCC 381 and in the case of Cipla Ltd. v. Maharashtra General Kamgar Union (2001) 3 SCC 101 were pronounced by this Court, and relying upon these decisions, an application was made by the Respondent company before the court that the complaints were liable to be dismissed as there was no employer – employee relationship between it and the complainants. Further a large number of decisions were put forward before this court. Due to conflict in judgments, this ..10..court sent the matter for the larger bench reference. PROS AND CONS OF MRTU & PULP ACT The MRTU & PULP Act is lauded for several reasons. It provides for the recognition of trade unions at the enterprise level, something that is missing in most other states and even at the Central level. By ensuring ‘one union one enterprise’, it helps tackle the problem of multiple unions, the most irritating feature of unionism in India.

The conciliation and referral processes under the Industrial Disputes Act are lengthy, bureaucratic and even political.In contrast, under the MRTU & PULP Act, the parties to a dispute can directly approach the labour judiciary and seek legal redress. Both the parties could get injunctions against the actions of the other; thus, no party could do anything without the due process of law be completed. Thus, it provides easy avenues for both, especially workers, to approach the court to prevent or challenge arbitrary actions. However, on the negative side, this easy access to the courts that the Act allows has encouraged high amount of litigation. The parties approach the courts apprehending the conduct of some unfair labour practice or the other and get stay orders. The Srinivasan Committee (2002) found two disturbing consequences of the Act. Firstly, a large number of unions did not seek recognition under the Act. The Committee found that as of 31 December 2001, only 1,445 applicant unions out of 3,302 were granted recognition under the Act. The important reasons for poor response include reluctance of the unions to comply with clauses imposing difficult obligations; long duration of recognition proceedings primarily because of the adoption of membership verification method (the average time taken is two years but there have been cases where it has taken eight years to grant recognition to unions). Secondly, the law failed to check unfair labour practices. Both employers and unions are guilty of approaching the court frequently and, as a result, the pendency of cases relating to unfair labour practices increased in all types of cases. The important cause for litigation by workers relates to unfair discharge by employers (an unfair labour practice under Schedule IV of the MRTP & PULP Act).

The main reason for high pendency was the long time taken to dispose of cases, which in turn, was due to (a) time consuming procedures adopted to decide on the disputes, (b) frequent and long adjournments sought by the parties, and (c) reluctance of the parties to comply with the procedural requirements of the Act. Litigation and the delay in disposal of cases cannot promote industrial harmony. With this I conclude.

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