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- The Industrial Disputes Act, 1947 makes provisions for the investigation and settlement of industrial disputes.
- It contributes to progress of industry by facilitating harmony and cordial relationship between the employers and employees.
- This Act extends to whole of India.
- To understand the Act, it is crucial to understand the concepts of
- “industrial dispute”
- “workmen”
- “industry”
These terms carry specific meanings under the Act which have been developed by the judiciary through case-rulings. The applicability of the Act will depend on whether a certain enterprise and the persons working there fall within the scope of these terms.
- “Industry” means any business, trade, undertaking, manufacture or calling of employers and includes any calling service, employment, handicraft, or industrial occupation or avocation of workmen. [Section 2(j)]
- The term “industry” has been defined by the Supreme Court in the landmark case of Bangalore Water Supply and Sewerage Board A. Rajiappa (AIR 1978 SC 548)
- Tests for determination of “industry”
- To determine whether an activity is covered by the definition of “industry” or not, the SC has laid down a “triple test”. Where there is
- a systematic activity
- organised by co-operation between employer and employee
- for the production and / or distribution of goods and services calculated to satisfy human wants and wishes there is an “industry” in that enterprise
- Does absence of a profit motive make a difference to this determination?
- profit motive or gainful objective is irrelevant
- professions, clubs, educational institutions, co-operatives, research institutes, charitable projects etc., if they fulfil the triple test, will not be exempted from the scope of an “industry”
- How about an enterprise that carries on more than one activity, where some qualify for exemption and some do not?
- For that purpose, the SC has laid down a test that relates to the “dominant nature” of an undertaking.
- Bangalore Water Supply has a wide sweep because the triple test along with dominant nature criteria will cover almost the entire labour force in the country.
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