This article is written by Rahul Manglani, pursuing Diploma in Labour, Employment and Industrial Laws (including POSH) for HR Managers from LawSikho. The article has been edited by Prashant Baviskar (Associate, LawSikho) and Smriti Katiyar (Associate, LawSikho).
Collective bargaining is a mechanism through which employers (organizations) and trade unions can agree on fair compensation and working conditions. It is also a base for establishing appropriate labour relations. Strike is a vital part of the collective bargaining process because it evaluates the economic bargaining power of each party involved and compels both parties to understand, realise, and evaluate the necessity it has for each other’s contribution. As the strike continues, both the parties bear losses- the savings of the employees involved in the strike continue to reduce, while the organization also bears huge losses due to the stoppage of production which affects the bottom line. Lockout is exactly the opposite of strike. Strike is a weapon that is in the hands of the workers to force the employer to agree on their demands. Similarly, a lockout is a weapon in the hands of the management to compel the workers to further negotiate on their demands relating to the conditions of employment, in the favour of the employer.
What is a strike?
A strike is a stoppage of work initiated by the refusal of most workers to perform their work. A strike is usually a consequence that happens due to grievances that are not addressed by the employer on a timely basis.
Strikes became a popular phenomenon at the time of the Industrial Revolution when mass workers became vital in factories and mines. In most nations, strike actions were quickly made illegal, as employers comparatively had more political power than the employees.
The right to strike by employees or workers is a well-recognised tool that is available to workers to negotiate with the employer and force the employer to agree on their demands. In our daily lives, very frequently we see news regarding workers going on strikes so that their demands in regards to their wages, benefits and working conditions are accepted by their employer.
The most important ingredients of a strike
The strike must be in an establishment that falls under the definition of “industry” as specified in the Industrial Disputes Act, 1947.
There should be a relation of employer-employee between the employer and the striking workmen.
There should be a stoppage of work by the workmen.
Types of strikes
Following are some of the different types of strikes:
- A general strike is a type of strike where the workers join together for a common reason or demand and keep themselves from work, depriving the employer of their workers to carry on their business operations.
- A “token strike”, which is for a shorter period, for example for a few hours, and its main aim is to draw the attention of the Management by showing cooperation among the workers, and it is generally before the general strike.
Why do workmen strike?
Most strikes are undertaken by workers’ unions at the time of collective bargaining. The main aim of collective bargaining is to obtain an agreement between the workers’ union and the employer on the terms and conditions of employment.
Sometimes, workmen decide to strike without the intervention or approval of a workers’ union. This happens either because the workers’ union refuses to support the reason for a strike as it seems invalid, or the workers who are initiating a strike are not a part of a workers’ union. Such strikes are usually considered unofficial.
Strikes initiated without obtaining official approval of the workers’ union are also known as wildcat strikes. In many nations, wildcat strikes are not considered legal and may lead to fines or penalties for the union members who engage themselves in such types of strikes.
What happens during a strike?
A strike may consist of the workmen who refuse to come to work or march outside the factory or office premises to prohibit other workmen from working or conducting any business with the employer.
It rarely happens that workers will leave the workplace, but will not agree to do their work or to leave the workplace. This is called a sit-down strike.
Significant case laws
In the case of TISCO Ltd vs Workmen, the verdict was that if the employer replaces the weekly day-off Sunday with another day-off without notifying the workmen in advance then such change will not be considered as a legal change. Therefore, the refusal of workmen to work on the day-off which was not a Sunday did not amount to strike.
In the case of North Brook Jute Co. Ltd. vs Workmen, the verdict was that when a scheme was introduced in contradiction to Section 33 of the Industrial disputes Act, 1947 then the refusal to act according to that scheme would not be considered as a strike.
In the case of Punjab National Bank vs All India Punjab National Bank Employees’ Federation, the verdict was that a pen-down strike would be considered as a strike because here the workers do enter the work or office premises but do not agree to perform their work.
In the case of T.K. Rangarajan vs Government of Tamil Nadu, the verdict was that the right to strike is not a fundamental right. In addition, it is also neither legal nor a statutory right. A similar thing was recognised in the case of B.R. Singh vs Union of India.
What methodologies do companies utilize to deal with a strike?
Most strikes declared by workers’ unions are usually predicted; as they usually take place after the employment contract has expired.
Preparation to deal with a Strike: Companies or Factories which manufacture goods for sale will frequently increase the level of their inventories before a strike takes place. Salaried workmen may be called upon to take the place of workmen who have engaged in strike, which may require them to take training in advance. If the organization has multiple work locations, workmen may be redeployed to meet the business needs of the decreased workmen.
Organizations may also take out strike insurance before an expected strike, which may help to cover the losses which would cause because of the strike.
One of the weapons utilized by the worker’s unions is the strike action. Some organizations may refuse entirely to negotiate with the workers’ union and may respond to the strike by hiring workmen in replacement of the striking workmen. This may create a difficult situation for strikers as they need to take a call if they have to stick to their original plan, or if there is a possibility that the strike may be lost? Strikers might also wonder how long will the strike last? Will their employment still be there if the strike fails?
Organizations that engage the services of strikebreakers usually take advantage of these anxieties among strikers when they attempt to convince them to end the strike.
Another remedy to a strike is a lockout, which is a way of work stoppage in which an employer (organization) does not allow workmen to continue their work.
What is a lockout?
Lockout is the opposite of a strike. Strike is a tool in the hands of the workmen to compel the management to agree to their demands. Similarly, lockout is a tool in the hands of the management to force the workmen to further negotiate on their demands which are related to the terms and conditions of the workers’ employment.
As per the Industrial Disputes Act, 1947, Lock-out means 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.
This definition consists of the following three components of a lockout:
- Temporary closing of a place of employment; or
- Suspension of work, or
- Refusal to continue to employ any number of persons employed by the employer.
When a lockout takes place, the workers are asked by the management to stay away from work, and therefore, they are not obliged to attend work.
In the case of Shri Ramchandra Spinning Mills vs State of Madras, it was seen that if the employer closes his place of business as a means of reprisal or as an instrument of coercion or as a mode of exerting pressure on employees or generally speaking when his act is what may be called an act of belligerency there will be a lock-out.
In the case of Lord Krishna Sugar Mills Limited Saharanpur vs State of UP, the verdict was that a lock-out may sometimes be not at all connected with economic demands; it may be resorted to as a security measure.
In the case of Lakshmi Devi Sugar Mills Limited vs Ram Sarup, the verdict was that in the case of lockout there is neither alteration to the prejudice of workmen of the conditions of the service application to them nor a discharge or punishment whether by dismissal or otherwise.
Thus, we can conclude that Strikes and Lockouts are effective weapons for both employers and employees who are engaged in the process of Collective Bargaining, provided that such weapons are utilized lawfully and ethically.
India in the present context of economic development programs cannot afford the unqualified right to the workers to strike or to the employer to lock-out. Compulsory arbitration as an alternative to collective bargaining has come to stay. The adoption of compulsory arbitration does not, however, necessarily mean denial of the right to strike or stifling of the trade union movement. If the benefits of legislation, settlements and awards are to reach the individual worker, not only the trade union movement has to be encouraged and its outlook broadened but the laws have also been suitably tailored.
The existing legislation and judicial pronouncements lack the breadth of vision. Indeed, the statutory definitions of strike and lock-out have been rendered worse by a system of interpretation that is devoid of a policy-oriented approach and which lays undue stress on semantics.
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