Module IV
INDUSTRIAL EMPLOYMENT(STANDING
ORDERS)Act ,1946
Introduction
During the era of laissez- faire the policy of hire and fire was very common. The economic
law of demand and supply in many of the cases was determining the wage rates, conditions
of service etc. The employer and the workmen used to settle the term of contract of
employment on mutual agreed terms and conditions after individual bargain, which may be
express or implied
Before the enactment of this Act the situation in many industrial establishments was that
the terms and conditions of service were not reduced into writing.
Moreover the industrial workers had no right to know the terms and conditions of their
employment and also the rules of discipline they expected to follow.
In addition to it there were no certainty in the rules which ultimately proved convenient and
favourable for the employers.
The terms and condition of Service were not similar in all establishments in the absence of a
legislation in this regard.
Contd.
Prior to the enactment of the Industrial Employment (Standing Orders)Act,1946,the
conditions of employment in the industrial establishments were governed by contracts
between employer and his workmen without the interference of the state.
Non-interference by the state caused the employer to lay down the conditions of the
employment of their choice.
The conditions laid down by the employer promoted the interests of the employers but
ignored the interest of the workmen.
In many cases the conditions of the employment were not reduced to writing and were
governed by oral agreements. Thus, the condition of employment in many cases were not
well defined prior to the enactment of the Industrial Employment(Standing orders)Act,1946.
As a result of these reasons, the Industrial Employment (Standing Orders)Act ,1946 came
into existence.
Object of the Act
The objective of the Industrial Employment (standing Orders)Act,1946 is to require the
employers to define with sufficient precision the conditions of employment under them and
the said conditions known to the workmen employed by them.
The employers shall have to define precisely the conditions of employment and to make
these conditions known to the workmen employed in their industries. It provides uniformity
of terms and conditions in respect of all workmen employed in the industry and belong to
the same category. All these conditions will be reduced to writing and to get them
implemented compulsorily with a view to avoid any unnecessary industrial unrest.
M/S Glaxo Laboratories(I) Ltd V P residing Officer Labour Court AIR 1984 SC 505
the Supreme Court made the following observation
“moving from the days when whims of the employer were supreme, the industrial
Employment Act 1946 took a modest step to compel by statute the employer to prescribe
minimum conditions of service subject to which employment is given.”
Sudhir Chandra V Tata Iron and Steel C. Ltd. 1984 Lab IC 790(SC)
The Industrial Establishment is a legislative approach to the laissez-faire rule of hire and
fire at sweet will. It is an attempt at imposing a statutory contract of service between two
parties unequal to negotiate , on equal footing.”
Contd.
Bharat Petroleum Corporation Ltd.V Maharashtra General Kamgar Union 1999 Lab IC 430 SC
“The Industrial Employment (Standing Orders)Act,1946 was made by the parliament to require
employers of all Industrial establishments to define formally the conditions of employment on
which the workmen is engaged. The object underlying the Act, which is a beneficent piece of
legislation is to introduce uniformity of terms and conditions of employment in respect of workmen
belonging to the same category and discharging the same and similar work under the industrial
establishment and to make the terms and conditions of industrial employees well settled and
known to the employees before they accept employment.”
Salem Erode Electricity Distribution Co. (P) Ltd V Their Employees Union AIR 1966 SC 808
The Supreme Court has laid down that the Act now requires that the terms and conditions of employment in
relation to matters specified in the Schedule must be included in the standing orders and they must be certified.
Important Features of the Act
The important features of the Act are
(a) Employers is bound to frame standing orders and to have them certified
(b) Standing orders should relate to matters specified in Schedule attached to the Act.
(c) The certifying officer is required to certify standing [Link] this process he can add or
modify the draft standing orders.
(d) The employers of similar industrial establishments can submit joint draft standing orders
for their certification to the Certifying Officer.
(e) Model Standing orders may be framed by the Government.
(f) The Act is applicable to an industrial establishment wherein one hundred or more
workmen are employed or were employed on any day of the preceding twelve months.
(g) Failure to submit draft standing orders leads to punishment for the employer.
(h) Power of granting exemption to any industrial establishment from the application of this
Act lies with appropriate Government.
Definition
Section 2(c)Certifying officer means a Labour Commissioner or a Regional Labour
Commissioner, and includes any other officer appointed by the appropriate Government, by
notification in the Official Gazette, to perform all or any of the functions of a Certifying Officer
under this Act.
Therefore Certifying officer means-
(a) Labour Commisioner or
(b) Regional Labour Commissioner or
(c ) Any officer appointed by the appropriate Government.
Section 2(b) Appropriate Government means:
[Link] Central Government
(i) in respect of industrial establishment, under the control of the central
Government ,or (ii) a Railway Administration (iii) a major port, mine or oilfield ,and
(II) The state Government in all other cases
CONCEPT OF STANDING ORDERS
The Industrial Employment Act, 1946 defines the meaning of ‘Standing Orders’ in SECTION 2
(g). These are the rules which relate to the matters explained in the Schedule.
The Schedule attached to the Act includes the following matters-
(1)Classification of workmen,e.g whether permanent,temporary, apprentice,probationers,or
badlis.
(2) Manner of intimating to workmen periods and hours of work ,holidays ,pay days and
wage rates.
(3) Shift Working.
(4) Attendance and Late coming
(5) Conditions of procedure in applying for and the authority which may grant leave and
holidays
(6) Requirement to enter premises by certain gates and liability to search.
Contd.
7. Closing and reopening of sections of the industrial establishment and temporary
stoppages of work and the rights and liabilities of the employer and workmen arising
therefrom.
8. Termination of employment and the notice thereof to be given by employer and
workmen.
9. Suspension or dismissal for misconduct ,and acts or omissions which constitute
misconduct.
10. Means of redress for workmen against unfair treatment or wrongful extraction by the
employer or his agents or servant.
[Link] other matter which may be prescribed
Submission of draft standing orders-Section 3
Section 3 of the Act makes it mandatory for an employer to submit draft standing orders to the
Certifying Officer as per the procedure laid down under this section .Section 3 provides as under-
(1)Within six months from the date on which this Act becomes applicable to an industrial
establishments, the employer shall submit to the Certifying Officer five copies of the draft standing
orders proposed by him for adoption in his industrial establishment.
(2) Provisions shall be made in such draft for every matter set out in the Schedule which may be
applicable to the industrial establishment, and where model standing orders have been prescribed ,shall
be ,so far as is practicable ,in conformity with such model.
(3) The draft standing orders submitted under this section shall be accompanied by a statement giving
prescribed particulars of the workmen employed in the industrial establishment including the name of
the trade union, If any to which they belong.
(4) Subject to such conditions as may be prescribed ,a group of employers in similar industrial
establishments may submit a joint draft of standing orders under this section.
Contd.
Associated Cement Co. v P.D Vyas AIR 1960 SC 665
the supreme Court has said that draft standing must be in conformity with the model standing orders
which is provided under section 15(2)(b) of the Act and unless it is shown that it would be impracticable
to do so, draft standing orders must be in conformity with the model standing orders. Though this
requirement does not mean that the draft standing orders must be in identical words ,it does not mean
that in substance it must confirm to the model prescribed by that appropriate Government. Model
standing Orders would prevail over Service regulations.
Rohtak and Hissar Districts Electric Supply [Link]. V State of U.P AIR 1966 SC1471
The Supreme court held that under section 3(2) of the Act the employers have to frame draft standing
orders and they must normally cover the items given in the Schedule to the Act.. If however if appears to
the appropriate authorities that having regard to the relevant facts and [Link] would not be
unfair and unreasonable to make provisions for particular items,it would be competent for them to do so ;
but the employer cannot insist upon a condition to the standing order which relate to a matter which is
not included in the Schedule.
Conditions for Certification of Standing Orders-Section 4
Section 4 of the Act lays down the conditions which must be fulfilled before the certification
of the standing orders. These are condition precedent for the certification of the standing
orders.
According to section 4 , the Certifying Officer shall certify the standing orders if the following
conditions are fulfilled-
(a) provisions is made therein for every matter set out in the Schedule which is applicable to
the industrial establishment, and
(b) the standing orders are otherwise in conformity with the provisions of this Act;
and it shall be the function of the Certifying Officer or appellate authority to adjudicate
upon the fairness or reasonableness of the provisions of any standing orders.
Contd.
Workmen of Lakheri Cement works Ltd. V Associated Cement Companies Ltd.
(1976)20 FLR 243
The Certifying Officer under section 4 has to satisfy himself that the draft standing orders
relate to every matters mentioned in the Schedule and are in conformity with the
provisions of the Act. Draft standing orders cannot relate to matters outside the
Schedule .Extension of standing orders to matters not included in the Schedule will be
complete nullity.
Associated Cement Ltd. V P.D Vyas AIR 1960 SC 665
The Supreme Court has discussed the word ‘adjudicate’ appearing in section 4 of the Act. It
held that the word ‘adjudicate ‘ used in the section 4 of the Act indicate without doubt that
the Certifying Officer will apply and decide as to the fairness and reasonableness of any
standing orders only when the parties are at issue on such question. Thus, in the absence of
the objections to the standing orders as submitted by the management , the standing orders
as filed have to be certified
Certification of Standing Orders Section 5
Section 5 of the Act lays down the procedure for the certification of standing orders. The
Certifying officer is required to follow this procedure .According to subsection (1) of section
5,the Certifying Officer is bound to send the copy of the draft standing orders to the trade
union of the workmen,if any,and in case of no trade union of the workmen the copy shall be
sent to the workmen concerned. The Certifying Officer shall seek the objection,if any, of the
workmen relating to the [Link] trade Union or the workmen shall submit the objections
within 15 days from the receipt of the said notice.
Subsection (2) provides that after giving the employer and the trade union or such other
representatives of the workmen as may be prescribed an opportunity of being heard, the
Certifying officer shall decide whether or not any modification of or addition to the draft
submitted by the employer is necessary to render the draft standing orders certifiable under
this Act, and shall make an order in writing accordingly.
Contd.
Subsection (3) lays down that the certifying Officer shall thereupon certify the draft
standing orders ,after making any modifications therein which his order under subsection
(2) may require ,and shall within seven days thereafter send copies of the certified standing
orders authenticated in the prescribed manner and of his order under subsection (2) to the
employers and to the trade union or other prescribed representatives of the workmen
Therefore as per the requirement, within seven days from the date of passing such final
standing order, copies of the certified orders authenticated in the prescribed manner and
the order of the certifying officer under section 5(2) must be sent to the employer and to
the trade union or other prescribed representatives of the workmen .Certified standing
orders will not over-ride service conditions in the appointment letter.
The Standing orders duly certified have the force of the law like any other statutory
instrument.
Contd.
Bansidhar Sharma V Certifying Officer andLabourCommisiioner,Guwahati,1997 Lab IC
3061(Gau)
there was settlement between workmen and employer regarding age of superannuation to be
[Link] the Certifying Officer reduced it to 50 years in the certified standing
orders without hearing the workmen . The Guwahati High Court held that such reduction in
the certified standing order is improper .Because such reduction is not fair and reasonable.
GAIL’S Employees Association ,Gas Authority of India Ltd. V Chief Labour
Commissioner(Central) 1997 Lab IC 1329(Del)
The standing orders certified under Sec.5 empowered the management to detain or ask any
number of workmen to come on duty on any national or festival holiday or on any day. The
Delhi High Court held such standing order invalid .Because the Court held that the
employer in this case was engaged in providing essential services and this power is given
to the management in the interest of safety and in the interest of continuous operation of the
undertaking.
Appeals Section 6
Subsection (1)Section 6 of the Act provides that any employer ,workmen , trade union or
other prescribed representative of the workmen aggrieved by the order of the Certifying
officer under subsection (2) of section 5 may, within 30 days from the date on which copies
are sent under sub section (3) of that section ,appeal to the appellate authority .
The appellate authority under subsection (1) may either confirm the order or make the
necessary modification so as to render the standing orders certifiable under the Act.
In this process the appellant will be given the opportunity to be heard.
Subsection (2) provides that the appellate authority shall within 7 days of its order under
subsection (1) ,send copies thereof to the Certifying officer to the employer and to the trade
union or other prescribed representatives of the workmen, accompanied unless it has
confirmed without amendment the standing orders are certified by it and authentication in
the prescribed manner.
Date of operation of standing orders section 7
The standing orders shall come in operation on the expiry of 30 days from the
date on which authenticated copies of the order are sent under section 5(3) ,but
in case an appeal has been preferred the standing order shall come into operation
on the expiry of 7 days from the date on which copies of the order of the
appellate authority are sent under section 6(2).
Register of standing orders- Section 8
Section 8 makes it obligatory for the Certifying Officer to file a copy of the standing orders in
the register. It provides that a copy of all standing orders are finally certified under this Act
shall be filed by the Certifying officer in a register in the prescribed form maintained for the
purpose and the certifying officer shall furnish a copy thereof to any person applying therefore
on the payment of the prescribed fee.
Duration and Modification of Standing Orders Section 10
The provisions relating to duration and modification of standing orders have been laid down
under section 10 of the Act .Sub-section (1) of section 10 provides that standing orders finally
certified under this Act shall not, except on agreement between the employer and the workmen
,or a trade union representative body of the workmen, be liable to modification until the expiry
of six months from the date on which the standing orders or the last modifications thereof came
into operation.
It implies that the certified standing orders cannot be modified during the period of 6 months
except on the agreement between the employer and workmen or a trade union or other
representative body of workmen. Modification of certified standing orders cab be sought by
Management or by the employees
Subsection (2) of section 10 deals with the question as to who can apply for the modification of
standing orders. It provides that the following persons may apply to the Certifying Officer for the
modification of the standing orders-
Contd.
(1) employer;or
(2)Workmen ;or
(3) trade union; or
(4) representative body of workmen.
It is further laid down that the application for the modification of standing orders shall
be accompanied by five copies of the modification proposed to be made , by
agreement between the employer and the workmen or trade Union or other
representative body of the workmen ,a certified copy of that agreement shall be filed
along with application.
Contd.
The Supreme Court in Shahdara (Delhi) Saharanpur Light Railway Co. Ltd. V S.S
Railway Workers Union AIR 1969 SC 513,
“The policy of Section 10 is clear that a modification should not be allowed within six
months from the date when the standing orders or the last modifications thereof came into
operation. The object of providing the time limit was that the standing orders or their
modifications should be allowed to work for sufficiently long time to see whether they
work properly or not. Even that time limit is not rigid. Because a modification even before
six months is permissible if there is an agreement between the parties”.
Indian Oil Corporation Ltd. V Joint Chief Labour Commissioner and Appellate Authority
(1990) I LLJ 408(Delhi)
The workmen wanted the modification of the certified standing orders. They demanded the
raise in the age of retirement from 58 to 60 years. The Delhi High Court allowed the
modification of certified standing orders .Because the raise of retirement age from 58 to 60
years was held to be fair and reasonable modification.
Contd.
Bangalore Woolen Cotton and Silk Mills Co. Ltd. V Its Workmen 1956 IILLJ 13
It has been laid down that a modification of the standing orders can be sought even by a
workman on application to the certifying Officer and in such a case there need not be any
industrial dispute.
In Ghaziabad &Hisar Districts Supply Co. Ltd. V State of U.P AIR 1966 SC1471
The Supreme Court has held that the modification of standing orders is within the
jurisdiction of the Certifying Officer. If he has not contravened any provisions of the Act or
any statute and his findings are also concurred by the appellate authority ,the Supreme
Court willnot interfere in such case under Article 136.
In United Glass works Ltd. Bombay v Their Workmen 1955 IILLJ 327
It has been held that where modification in the existing orders has been agreed upon
between the employer and the workman the Certifying Officer is not bound to accept the
changes if they are not in conformity with the prescribed model standing orders.
Temporary application of model standing orders –Section 12 A
Section 12 A of the Act deals with application of model standing orders to the establishment
temporarily .Subsection (1) lays down that notwithstanding anything contained in section 3
to 12 ,for the period commencing on the date on which this Act becomes applicable to an
industrial establishment and ending with the date on which the standing orders are finally
certified under this Act come into operation under section 7 in that establishment, the
prescribed model standing orders shall be deemed to be adopted in that establishment ,and
the provisions of Section 9 ,subsection (2)section 13 and section 13 shall apply to such
model standing orders as they apply to the standing orders so certified.
It implies that the model standing orders will be presumed to apply to an industrial
establishment for a temporary period during which the standing orders are in the process of
certification. In such situation the requirement of the posting of model standing orders,
penalties for contravention of the provisions of the orders and the power of interpretation
of the model standing orders are similar to those of the certified standing orders.
Contd.
Subsection (2) of Section 12 A provides that nothing in sub-section(1) shall apply to an
industrial establishment in respect of which the appropriate government is the government
of the State of Gujarat or the Government of the State of Maharashtra.
Section 12 A connotes that the application of the model standing orders to such
establishment is limited to a temporary period, namely ,until the standing orders are finally
certified under this Act come into operation for such establishment.
Penalties and Procedure- Section 13
Section 13 deals with the provision providing penalty for the employer in case of the contravention of
the provisions of the Act. This Section provides as follows
An employer who fails to submit draft standing orders as required by Section 3 or who modifies his
standing orders otherwise than in accordance with Section 10, shall be punishable with fine which
may extend to five thousand rupees, and in the case of a continuing offence with a further fine which
may extend to two hundred rupees for every day after the first during which the offence continues.
An employer who does any act in contravention of the standing orders finally certified under this Act
for his industrial establishment shall be punishable with fine which may extend to one hundred
rupees, and in the case of a continuing offence with a further fine which may extend to twenty-five
rupees for every day after the first during which the offence continues.
No prosecution for an offence punishable under this section shall be instituted except with the
previous sanction of the appropriate Government.
No Court inferior to that of [a Metropolitan or Judicial Magistrate of the second class] shall try any
offence under this section.
Contd.
In Aboo Mohammadv State of Bihar 1977 Lab IC 1396 (Pat)
It was held that the employer could be prosecuted for breach of standing order unless
section 13(2) even though furnishing of wage slips was not a matter enumerated in the
Schedule of the Act.
In Deepak Narayan Joshi V Hindustan Organic Chemicals Ltd. 2013 III LLJ 475
The contention before the Bombay High court was the proceedings before the Inquiry officer
deserves to be stayed until disposal of the criminal proceedings .The Court held that the
purpose of the departmental inquiry and prosecution before the criminal proceedings. The
court held that the purpose of departmental inquiry and prosecution before the criminal court
are of two different and distinct aspects. There is no bar in case of proceedings in a criminal
case and departmental proceedings proceed simultaneously though separately.
Interpretation of standing Orders-Section 13 A
Section 13 A deals with the question of interpretation of standing orders. It provides that if any
question arises as to the application of interpretation of a standing orders certified under
certified under this Act, it can be referred either by the employer or by a workman or a trade
union or other representative body of the workmen to a labour court constituted under the
Industrial dispute Act,1947, and specified for the disposal of such proceeding by the appropriate
government by notification in the Official Gazette. The labour court to which the question is so
referred shall ,after giving the parties an opportunity of being heard, decide the question and
such decision shall be final and binding on the parties.
The function of Labour Court to whom the question of interpretation of standing orders has been
referred is limited only to the decision of the question as to application or interpretation of
standing orders which are referred to it. It is not invested with invested with the power to grant
relief in enforcement of the rights and obligations created by the standing [Link] is also
essential for the Labour Court to give opportunity to all parties concerned before any decision is
taken on the question of application or interpretation of the certified standing orders.
Contd.
In Chipping and Pointing Employees Association (P) Ltd. V A. T. Zamdre 1968 II LLJ
193
it has been held that an application under section 13 A of the Act can be
maintained by a person who before the making of that application was a workman
and seeks to have a question as to the application or interpretation of a standing
order determined in relation to the period during which he was a workman
Contd.
In Sabhapati Singh V U.P State Road Transport
Corporation(1994)ILLJ(211(All)
The retirement age of the Government employees was 58 Years .Some Government
employees were sent on deputation to the U.P State Road Transport Corporation.
The retirement age of the employees of the State Road Corporation was 60
years. .The Allahabad High Court in this case held the provision regarding the
retirement age of Government employees working in the corporation on
deputation is to be interpreted as 58 years and not as 60 years.
In Ram Asrey V Labour Court II Kanpur 1991II LLJ 425 (All)
the word ‘misconduct’ specified in Standing Orders was interpreted under Sec 13-
A .The question to be decided in this case was whether a workmen assaulting a
Junior Officer outside the office premises or precincts of establishment amount to
“misconduct” taking place within the establishment.