Latest News

Settlement of Industrial dispute through Arbitration and Conciliation


The Industrial Dispute Act, 1947 came into existence in April 1947 . It was enacted to make provisions for investigations and settlement of industrial dispute and to ensure fair wages and other safeguards to the workers.

According to the section 2(k) of this act , the industrial disputes  means any dispute or difference between employers and employee or between workman or employer or between workman or workman , which is connected with the employment or non employment or with the condition of labour , or of any person. 

Under section 2(j) of the act defines industry it mean any business , trade undertaking manufacture or calling of employers and includes any calling service , employment , handicraft or industrial occupation or avocation of worker from the above definition , industry appears to mean 

  1. A business , such as merchant designing.
  2. A trade, such as cutler
  3. A manufacturer , such as flour milling 
  4. A undertaking such as electricity company.
  5. A calling such as architect.
  6. A service such as transporter or 
  7. An employment , which is a general term covering perhaps the rest of the vocations. 

Under section 2(s) of the act defines workman and section 2 (Q) of the act defines strike .

Two types of industrial disputes

There are basically two type of industrial disputes :- 

  • Interest disputes
  • Right disputes 

Interest disputes relate to determination of new wage level and other matter of employment. Whereas right disputes relate to the rules made for the workers and they have not been treated in accordance with that . 

There are various major industrial dispute settlement machinery which are as follow: -

  1. Concillation 
  2. Court of inquiry 
  3. Voluntary arbitration 
  4. Compulsory arbitration ( adjudication) 
  • Concillation 

Concillation is one of the non binding procedure where a impartial third party known as concillator , assist the parties to a dispute in reaching a mutually agreed settlement of dispute.

Concillation under the Industrial dispute act 

section 4 of the industrial dispute act , 1947 states the Concillation officers :- 

1) The appropriate Government may, by the notification in the Official Gazette , appoint such number of persons as it thanks fit, to be conciliation officers , charged with the duty of mediating in and promoting the settlement of industrial disputes.

2) A Concillation officer may be appointed for a specified area or for specified industries in a specified area or for one or more specified industries and either  permanently or for a limited period .

Section 12(A) of this act states the duties of conciliation officers:- 

1) If the industrial disputes exists or is apprehended, the conciliation officer may hold the conciliation proceedings if the dispute relates to a public utility service and a notice under section 22 has been given.

2) The conciliation officer shall investigate the matter for the purpose of bringing amicable settlement of the dispute.

3) If the settlement is arrived at , the conciliation officer shall send a report to the appropriate government or the officer authorised by the appt government , with the memorandum of the settlement signed by the disputed parties .

4) If no such settlement is arrived at , the conciliation officer shall send a report to the appropriate government mentioning the reasons on account of which in his opinion a settlement could not be arrived at.

5) The report shall be submitted within 14 days of the commencement of the conciliation proceedings or within such shorter period as maybe fixed by the appropriate government .

Arbitration under the Industrial dispute act 

Arbitration is a mechanism in which a dispute is resolved by a impartial third party whose decision is final and binding upon the parties.

There are two types of arbitration :- 

  • Voluntary arbitration 
  • Compulsory arbitration

Voluntary Arbitration 

In this , the parties themselves agreed on their own to use an outside party , to settle their disputes . It is non binding in nature.

Compulsory Arbitration(Adjudication)

Compulsory arbitration is one where the parties are required to accept arbitration without any willingness on their party .It is also non binding in nature .

Tier of Adjudication 

  • Labour Courts 
  • Industrial Tribunals
  • National Tribunals 

Under the section 10 of this act states the , Reference of disputes to Boards , Courts or Tribunals 

If the appropriate Government is of opinion that any industrial dispute exists or is apprehended , it may at any time by order in writing refer the dispute to Court , Tribunal or Board 

Section 11 of this act states the procedures and powers of conciliation officers , Boards , Courts and Tribunals 

Section 18 of this act states that on whom settlements and awards are binding between the workerman and employer otherwise than in the course of Concillation proceeding shall be binding on the parties to the agreement. 

Subject to the provision of subsection (3) an arbitration award which has become enforceable shall be binding on the parties to the agreement who referred the dispute to arbitration.

Also the settlement arrived at in the course of Concillation proceeding and an award of a Labour court , Tribunal or National Tribunal shall be binding on all parties to the industrial dispute.







  • Introduction
  • Industrial dispute
  • Arbitration and Conciliation mechanism

BY : Riya Sehgal

All Latest News