A Study on Arbitration for the Resolution of Industrial Disputes in Tamil Nadu

A Study on Arbitration for the Resolution of Industrial Disputes in Tamil Nadu

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Published: 20th DEC 2022

Tagged: Academic Law

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Introduction

This section explores earlier research to get insight into the numerous criteria needed to comprehend the idea of disputes and the methods used to resolve them in businesses functioning in diverse global economies. This part will also concentrate on some prior studies done in the current context with industrial conflicts and their resolution methods for the manufacturing industries over the period to establish a logical grasp of the concepts, techniques, methodology, and results.

Concept of Industrial Conflicts

Dissatisfaction with the way justice is administered as old as the law. Not to stray too far from our legal framework, discontent has a long and unbroken history. The administration and operation of a country are determined by its legal system. Conflicts are inescapable in any government, whether a federation or a unitary one (Pound, 1906). The legal system's framework must evolve to meet and address these issues. A country's economy depends on its industries; thus, industrial disputes have inevitably become a part of how these businesses operate on a fundamental level. A dispute between employers and employees, employees and other employees, or employers and employers is referred to as an "industrial dispute" in the broadest sense(Nadagoudar, 2006). Such disputes may involve a variety of concerns, including those relating to labourers' working conditions, non-employment, terms of employment, and employers. Differences between the employer and employees are common, but the same can be said of differences inside the workforce, which can lead to disagreements. The space between the two may always be filled, though. Conflicts of interest between members of an industry are known as industrial conflicts. The employees' wages or the working conditions they would be subject to are among the most frequent causes of this argument. The first law in this area, the health, and Apprentices Act, now known as the Factories Act, was passed in 1802.

Reasons for Industrial Conflicts

Industries provide a wide range of people's livelihoods, but several problems cause conflicts among the industries' varied sectors. For example, numerous factors might have adverse effects or bring about an industry's demise. Here is a list of the principal highlights of the same:

Disagreement regarding wages

The latter's wages are a significant source of conflict between management and the workforce. The declaration that bonuses are linked to production may also contribute to the rise in disagreements(Tiwari, 2012). Managers have many concerns about trade unions because of the disparity in wage agreements. In a historic judgement, the Supreme Court of India ruled that while "equal compensation for equal work" is not explicitly stated as a fundamental right in the Constitution, it can nonetheless be interpreted as providing guiding principles for State policy(Randhir Singh v. Union of India, 1982).

Lock-outs

Industrial disputes may also result from protracted strikes and heedless trade unionism. These typically happen when employees become militant, and companies use lockouts to address this behaviour(Rathnamma & Rajendraprasad, 2017).

Hours of work, leaves, and closure

The set work hours, holidays, closures, and other factors, are factors in industrial disputes. Even though the causes are referred to as secondary causes, they have the potential to start a fire that spreads quickly. Employer and employee have frequently agreed upon leaves, but when the same need to be extended, it can cause conflict between the two parties(Rajesh & Manoj, 2013). Like the opening, the closing can have a significant effect.

Working Conditions

The working conditions of the labourers have given rise to several additional causes of industrial disputes, such as economic, social, and even psychological factors. The remainder may be different, whereas the economic factors are solely tied to issues involving salaries and bonuses(Nwachukwu et al., 2019).

Retrenchment

Expressed, "retrenchment" refers to cutting expenses to address the financial crisis. Retirement and contract termination while non-renewal, illness, and employee-initiated voluntary pension are among the causes. The Industrial Disputes Act, 1947's Section 25 A through E, is devoted to the steps and requirements for layoffs and retrenchments. Employees may rebel against their employers if they are demoted or fired. Ego, team spirit, and employee unity can typically impact this behaviour. As was already mentioned, reductions are one of the main economic reasons for industrial disputes. Different political affiliations of various trade unions might lead to disagreements(Soundrarajan, 1994).

Industrial Conflicts in the context of India

The problem presented by industrial disputes is not unfamiliar to Indian industries. With the entrance of sectors to the country, India has seen an increase in industrial disputes. The emphasis has switched to the psychological aspects causing such conflicts because of the industries' fast transformation. Because of this, modifications to the management process would be made(Bhat & Swami, 2018). Strikes and lockouts have become commonplace in all Indian sectors because of the country's fast industrialisation. Strikes result in lost person-days and a sharp reduction in labourers' pay. However, studies have shown that the number of disagreements, lost person-days, and workers involved in such disputes gradually drop over time(Bhat & Swami, 2014). India's data on industrial sector conflicts have established a respectable drop. The graph has been examined over the years to look for these arguments. It demonstrates how, even though the strikes and lockouts of 1995 and other similar years had lasted for a considerable amount of time, costing 38.3 lakh person-days and affecting 6.9 lakh workers, a further drop could be seen in recent years. According to the same report, recent disagreements have cost 2 lakh person-days, indicating a sharp reduction(Kanolkar, 2020). The final Act continues to be the controlling Act for all industrial disputes in India, notwithstanding various revisions.

Consequently, the law and collective bargaining structure is created to protect labour(Lansing & Kuruvilla, 1986). India's industries had experienced better times in the past before the reforms. Although workers were less involved in the post-reform era, fewer person-days were lost during that period(Kavitha, 2018). The 1940 Arbitration Act is a notable piece of legislation. The communities typically settle their conflicts on their own. But with an objective derivation for the parties involved, interventions from various organisations and rules from the laws might speed up the process. This study has gone into great into discussing these processes.

Previous empirical studies on resolving workplace disputes

Numerous research has been carried out globally to pinpoint and present various facets of each approach for resolving industrial conflicts. The examinations for the same are listed below:

Indian Perspective

In an industrial dispute, the parties are the employers and the workforce. These disputes are common and can easily interfere with the operation of these industries in a diverse economy like India. Lockouts and strikes are frequently the results of disagreements between the parties. Indian researchers have made significant contributions to the study of the many ADR techniques to pinpoint the underlying issues and elaborate on the best technique among the others.

Rathnamma and Prasad proposed a study in the garment sector to analyse the industrial disputes in India to support their argument for collective bargaining. Most of this study's conclusions were based on secondary data from books and earlier investigations(Rathnamma & Prasad, 2017). The report stressed how "the essential feature of female presence in the labour force was shown to be reducing the prevalence of industrial disputes" after concluding that the inflated rate of contracted labour led to the detrimental effects of strikes.

Archana Bhatt conducted a study in Jammu and Kashmir to assess the reasons for labour disputes in the region's cement sector(Bhat & Swami, 2018). The analysis comprised a primary industry survey with 289 willing participants and data from annual reports and journal papers. It solely looked at the causes of conflicts and was restricted to the cement industry.

Rucha Kanolkar provided statistics to support this claim in her essay, demonstrating how, despite a recent drop in these disputes, West Bengal continues to rank as the state with the highest number of them, closely followed by Gujarat and Tamil Nadu(Kanolkar, 2020). The jute and textile industries were the only ones considered for this paper's analysis. The paper's focus, which was limited to the government's problems and solutions, was another drawback.

Arul Edison Anthony Raj (2014) concluded after doing a study based on the Indian industry that any industrial dispute hurt both the national economy and the affected industry. Its research incorporated earlier studies but did not focus on a particular genre(Edison Anthony Raj & Rajakrishnan, 2014). Instead, it was restricted to providing a broad overview of the sectors covered in the survey. There has been a dramatic drop since the advent of dispute resolution mechanisms.

Recent Indian researchers have hardly used detailed empirical data because most studies have used secondary sources. However, most studies have concentrated on the cotton industry, leaving other sectors primarily unexplored.

Tamil Nadu Perspective

Santhana Raj and Seenivasagam conducted a study on labour productivity and industrial relations to evaluate its efficacy. The derivations are founded on a field investigation conducted by the pharmaceutical chemistry companies in SIPCOT, Cuddalore(Santhana Raj & Seenivasagam K, 2013). 350 participants made up the study's sample, who were chosen by a lottery-style drawing and a stratified simple random approach. It featured people from the highest, middle, and lowest ranks. A pilot test was completed before the questionnaire's final design. By linking the jobs to those who did them, the study intended to understand how fulfilment and delights are derived. This study had a few limitations as well.

Sheetal sought to pinpoint why the Industrial Disputes Act of 1947's dispute settlement systems were unsuccessful and offered remedies to improve their efficiency. Secondary and primary data were used to aid the investigation(Malaisamy, 1999). The study's participants served as the significant data source, supplemented by information from Indian laws, international treaties, e-books, and research publications. In addition, conciliation officers, employers, workers, and leaders of the participating unions were present. In addition, employers of workers from various sectors, including hospital personnel and those working on a building site, and S.T and Mathadi employees were consulted for the questionnaire.

S. Balakrishnan tried to analyse several instances involving the labour relations at the Tamil Nadu Electricity Board. The researcher conducted interviews on his initiative to get the primary data used in this work(Balakrishnan, 2010). Management staff, employees, and union officials were present. Additionally, it contained secondary information gathered from various research papers, periodicals, books, and laws with a sincere study of rules.

Arbitration as a Means of Resolving Industrial Disputes: A Theoretical Approach

This section discusses the function of arbitration in Indian-specific industrial disputes. The supporters of arbitration understand the procedure's influence and effectiveness in conflicts of various natures, thanks to the numerous studies undertaken on this subject.

Saurabh Kulsretha focused on comprehending the efficacy of conflict resolution processes, emphasising Delhi(Kulsrestha, 2012). With a focus on LokAdalats, arbitration, mediation, and conciliation, the Delhi-based research tries to analyse ADR methods. The paper's methodology used information from books, earlier journals and publications, research papers, and newspapers. The Indian Constitution and many case laws served as the primary material sources for the study, which also drew on foreign and domestic legislation.

Research Gap

Industries are the foundation of any economy. Conflicts in any industry can therefore have an equal and adverse effect on other industries. The fact that any group of individuals is likely to argue is not surprising, but the challenge is finding ways to resolve these conflicts. Analysing the abovementioned studies, the following gaps can be identified.

Few research has looked at the results of workplace disputes; the majority have concentrated on their causes. There is a shortage of literature regarding the consequences, from the earliest studies to the most recent ones. Analysing the effects of labour disputes in various industries is crucial for providing better knowledge of the same. Another contributing aspect has been a minor propensity among researchers to favour collective bargaining while conveniently ignoring the other options. Although some studies have compared mediation and negotiation, they are different. Regarding ignoring some dispute settlement methods, it can be shown that, between arbitration and adjudication, the latter has received the least amount of research. Most of the studies, as previously said, have carried out research without a designated region, making the survey less structured and merely theoretical. However, very few studies have been done or have even referenced the sector. However, despite the drawn-out processes, arbitration is valid. Therefore, this study will try to analyse the disputes by checking all the boxes and putting the arbitration procedure front and centre.

References

Balakrishnan, S. (2010). Industrial relations in service sector in Tamil Nadu a study with special reference to TNEB. Madurai.

Bhat, A., & Swami, R. (2014). Industrial Conflicts Scenario in India. Prabandhan: Indian Journal of Management, 7. https://doi.org/10.17010//2014/v7i10/59250

Bhat, A., & Swami, R. (2018). Scenario of industrial dispute in Jammu and Kashmir. Journal of Management Research and Analysis, 5(2), 125–132. https://doi.org/10.18231/2394-2770.2018.0020

Edison Anthony Raj, A., & Rajakrishnan, V. S. (2014). A Study on Industrial Disputes and its effects: Exceptional reference to Indian Industries. EDUVED International Journal of Interdisciplinary Research, 1(6), 1–8.

Kanolkar, R. (2020). Essay on Industrial Disputes in India. Economic Discussion.

Kavitha, B. (2018). Industrial Disputes In India During Pre And Post Reforms Era : Dimensions And Implications. EPRA International Journal OfEconomic and Business Review, 365(September), 2016–2019.

Kulsrestha, S. (2012). Alternative dispute resolution mechanism: a case study of Delhi. New Delhi.

Lansing, P., & Kuruvilla, S. (1986). Industrial dispute resolution in India in theory and practice. Loy. LA Int’l & Comp. LJ, 9, 345.

Malaisamy, K. (1999). Conciliation in settlement of industrial disputes an empirical study in tamilnadu. Chennai.

Nadagoudar, S. V. (2006). A critical study of adjudication of industrial disputes with special reference to working of labour courts and industrial tribunal at Hubli. Dharwad.

Nwachukwu, P., Onyekachi, A. G., & Achori, T. (2019). Social Challenges of Industrial Relations: A Study of Federal Polytechnic Oil and Gas, Bonny, Rivers State, Nigeria. International Journal of Engineering and Management Research, 9.

Pound, R. (1906). The Causes of Popular Dissatisfaction with the Administration of Justice. https://law.unl.edu/RoscoePound.pdf

Rajesh, S., & Manoj, P. K. (2013). Trend and Pattern of Industrial Disputes in Kerala and the Implications on Industrial Relations in the State. Management, 2(11).

Rathnamma, R., & Prasad, T. R. (2017). Interpreting Industrial Disputes in India : A study with special reference to the garment Industry. International Journal of Humanities and Social Science Research, 6–11.

Rathnamma, R., & Rajendraprasad. (2017). Industrial Disputes in India - An Analysis. Santhana Raj, L., & Seenivasagam K. (2013). A Study On Industrial Relation And Labiour Productivity. Bharathidasan University. Soundrarajan, A. (1994). Settlement of industrial disputes in cotton textile industry in Madurai district. Tirunelveli. Randhir Singh v. Union of India, (1982). Tiwari, S. (2012). Labour Problems and Policies.