Nature & Causes of Industrial Disputes | Commerce & Accountancy Optional Notes for UPSC PDF Download

Introduction

• An industrial dispute arises when there is a disagreement between employers and employees regarding one or more issues. These disagreements are fundamental to the practice of industrial relations within an organization. The primary objective of industrial relations activities is to prevent disputes from occurring. The various elements of industrial relations are structured to curb industrial disputes and the resulting labor unrest. Industrial disputes often take the form of strikes, lockouts, picketing, go-slows, and gheraos, emphasizing the need for effective strategies to promptly identify and resolve employee grievances. Indeed, resolving grievances in a timely manner is crucial in preventing them from escalating into full-blown industrial disputes.
• Section 2k of the Industrial Disputes Act, 1947, defines an industrial dispute as any disagreement involving employers and employees, or between employers, or among employees, related to the employment, non-employment, terms of employment, or conditions of labor of any person.
• For a dispute to be considered an industrial dispute, certain conditions must be met:
  • There must be an actual disagreement or difference involving (a) employers and employees, (b) employers and employers, or (c) workers and workers.
  • The dispute must be linked to the employment, non-employment, terms of employment, or conditions of labor of an individual.
  • There must be an existing employer and workmen relationship resulting from a contract of employment, and the workmen must be actively employed.
• An industrial dispute is not a personal conflict involving only one individual; instead, it generally impacts a large group of workers with community interests. The parties involved in the dispute have a direct and substantial interest, and the issue is addressed collectively by workers or employers.

Characteristics of Industrial Disputes

The characteristics of an industrial dispute, as defined in the Industrial Dispute Act, are outlined as follows:

• Collective Nature: An industrial dispute is a collective disagreement involving both employers and employees. Individual disputes between a single employee and employer are generally not considered industrial disputes unless they involve issues such as dismissal, discharge, retrenchment, or termination. Typically, a substantial number of employees should be involved in raising the dispute.
• Relationship Between Parties: The parties involved in the industrial dispute must have a specific relationship, either as employer and employee or as co-workers, such as among workmen.
• Disagreements Over Terms of Employment: The dispute may arise from disagreements between employers and employees concerning terms of employment, including issues like wages, salaries, incentives, benefits, workloads, and similar matters.
• Linked to Conditions of Labour: It can also be connected to the conditions of labor, encompassing aspects like working conditions, occupational health, safety, and related concerns.
• Relating to Non-Employment Causes: An industrial dispute may even pertain to non-employment causes affecting workmen, extending beyond issues directly related to their employment status.

Causes of Industrial Disputes

Organizations can prevent industrial disputes by accurately identifying the causes of industrial relations tensions, which are generally classified as Economic and Non-Economic.

• Demand for Pay & Benefits Increase: Disputes often arise when employees seek higher pay and benefits, and employers refuse to meet these demands. Conflicting claims over organizational profits and wealth contribute to these disputes.
• Demand for Hygienic & Safer Working Conditions: Employee insistence on better and safer working conditions, including a suitable physical environment, adherence to safety measures, and workload concerns, can lead to industrial disputes.
• Demand for Better Labour Welfare & Social Security Measures: Employee demands for improved welfare facilities such as transportation, housing, education, recreation, canteen services, insurance, remote work, and flexible schedules can be a cause of industrial disputes. Similarly, the need for enhanced social security measures, including retirement benefits and medical facilities, may contribute to disputes.
• Demand for Recognition & Appreciation: Employees may also seek fulfillment of social needs like recognition, self-expression, appreciation, and opportunities for personal achievements. Denial or delay of these demands by employers can become a basis for industrial disputes.
• Demand for Justice for Individuals or Groups: Mass layoffs or retrenchment and disciplinary actions like dismissal, discharge, demotions, and suspensions can lead to disputes between employees and employers as per the Industrial Dispute Act, 1947.
• One-Upmanship Among Unions: Unions, in their effort to demonstrate credibility and dependability among members, may intentionally adopt a negative stance towards management. This can lead to disputes, even on trivial issues, to unite members and expand their base.
• External Interference: Allowing external leaders to manage unions, especially influenced by political considerations, plays a significant role in industrial disputes. Union stands on organizational issues are often dictated by the ideology and leadership of the political affiliation.
• Numerous Labour Legislation: Government-enacted legislations protecting workers' rights in industrial establishments create legal obligations for organizations. Violation or denial of these statutory facilities to employees becomes a cause for disputes between employers and employees.

Type of Industrial Disputes

• Interest Disputes: Interest disputes pertain to disagreements concerning the economic interests of employees, particularly during the negotiation or bargaining phase of collective bargaining. These disputes often center around issues such as wages, incentives, and other employee benefits. In essence, interest disputes revolve around the employment conditions of workers.
• Rights Disputes: Rights disputes involve conflicts regarding the understanding, interpretation, and application of rules and regulations that safeguard the rights of employees. These disputes may be connected to the interpretation and enforcement of statutory rules, company regulations, collective bargaining agreements, and employment contracts. Alleged violations of these rules serve as grounds for rights disputes.

Outcomes of Disputes

Strikes

A strike is a significant tactic employed by trade unions to apply pressure on employers to meet their demands. As per the Industrial Disputes Act, 1947, a strike is defined as the "cessation of work by a group of individuals employed in any industry, acting together or a coordinated refusal, or a refusal under a shared understanding, by any number of individuals who are or have been employed, to continue working or to accept employment."

Types of Strikes:

• General Strike: A large-scale strike organized by employees within an industry, region, or entire country. Typically, employees from a specific area, state, or nation unite with common goals and interests, rallying together.
• Pen-Down, Tools-Down & Sit-In Strike: In pen-down, tools-down, and sit-in strikes, employees report for duty but deliberately refrain from working. They enter the work premises but refuse to leave their designated places, remaining idle.
• Wild-Cat Strike: An unauthorized strike initiated by employees in violation of labor contracts or agreements is termed a wild-cat strike. Unions may resort to this type of strike to exert pressure on employers during negotiations.
• Go-Slow (Slow Down) & Work-to-Rule Strikes: Employees in a go-slow or work-to-rule strike continue working but deliberately reduce their output, showcasing their protest against employers by not performing at their usual levels or capacity.
• Sick Leave & Mass Leave Strikes: Employees participating in these strikes apply for sick leave or casual leave collectively, citing illness as the reason. The objective is to bring work to a halt, emphasizing their demands.
• Hunger Strike: Employees undertake fasting, abstaining from both food and work as a form of protest. As work ceases due to the employees' participation in fasting, it is considered a strike.
• Sympathy Strike: A strike carried out in solidarity with another group of striking employees, often belonging to a different employment category within the same organization. The purpose is to express support for and empathy with the other group's grievances.

Picketing

Picketing is a form of protest by employees aimed at dissuading non-striking colleagues from attending work during a strike. Striking employees gather in front of factory gates, urging non-strikers not to enter the premises and participate in the strike.

Gheraos

Gheraos involve employees encircling their employers or top managers at the workplace, limiting their movements. The purpose is to pressure employers or managers into conceding to the workers' demands. However, it's important to note that wrongful confinement is legally untenable, making gheraos an illegal act.

Lockouts

A lockout is the employer's response to employees' ongoing protests in the form of a strike. According to the Industrial Disputes Act, 1947, a lockout is defined as "the temporary closing of a place of employment or the suspension of work, or the refusal by an employer to continue to employ any number of persons employed by him."