India: Wages During Strike Period Legal Interpretation

Last Updated: 22 September 2016
Article by Krishna Vijay Singh

Collective bargaining is a legally recognized and sanctioned tool with the employees to negotiate better working environment for themselves. Strike is an extreme form of collective bargaining where employees collectively refuse to undertake work unless their demands are conceded by the management. Strike is regarded as one of the most potent and extreme weapon with the employees in their struggle against the employer for getting their grievance(s) redressed. Right to strike is an important weapon in the armoury of workers and has been specifically recognized in the Indian legal framework. Though not raised to the high pedestal of fundamental right, it is recognized mode for resolving the grievances of the workers. However, right to strike is not absolute and the law specifies the manner and procedure by which employees can resort to the extreme measure of striking work.

As per Section 2 (q) of the Industrial Disputes Act, 1947 ("ID Act"), strike means "cessation of work by a body of persons employed in any industry acting in combination, or a concerted refusal, or a refusal under a common understanding, of any number of persons who are or have been so employed to continue to work or to accept employment." As stated, the right to strike is not absolute under our industrial jurisprudence and restrictions have been placed on it. These restrictions are found in sections 10(3), 10A(4A), 22 and 23 of the ID Act. Any strike which is commenced or declared in contravention of Section 22 or 23 or is continued in contravention of an order made under Section 10(3) or 10A(4A), is considered illegal as per Section 24 of the ID Act. Thus, Section 24 of the ID Act makes it abundantly clear that if a strike does not contravene the provisions of ID Act, same can be termed as a legal strike.

However, if the strike is illegal, workers guilty of illegality are liable to be punished with imprisonment for a term which may extend to one month, or with fine which may extend to fifty rupees, or with both as stipulated under Section 26 of the ID Act. Besides the penalty prescribed under Section 26 of the ID Act, another consequence of an illegal strike is the denial of wages to the workers involved in such strike. Since, the ID Act is silent upon the wages during the period of strike the issue of denial of wages during the period of strike has been under constant judicial scrutiny in various courts or tribunals across the country. The aforesaid issue has been discussed by the Hon'ble Supreme Court in Crompton Greaves vs. the Workmen (1978) 3 SCC 155, where the Hon'ble Court held that "It is well settled that in order to entitle the workmen to wages for the period of strike, the strike should be legal as well as justified. A strike is legal if it does not violate any provision of the statutes. Again, a strike cannot be said to be unjustified unless the reasons for it are entirely perverse or unreasonable. Whether a particular strike was justified or not is a question of fact which has to be judged in the light of the facts and circumstances of each case." Besides the above the Hon'ble Court also observed that "It is also well settled that the use of force or violence or acts of sabotage resorted to by the workmen during a strike disentitles them to wages for the strike period." However, in case of Bank of India vs. T.S. Kelawala (1990) II LLJ 39, the Hon'ble Supreme Court endorsed a different view by observing that "where the contract, Standing Orders or the service rules/regulations are silent on the subject, the management has the power to deduct wages for absence from duty when the absence is a concerted action on the part of the employees and the absence is not disputed."The Hon'ble Court further held that "...whether the strike is legal or illegal, the workers are liable to lose wages for the period of strike. The liability to lose wages does not either make the strike illegal as a weapon or deprive the workers of it. When workers resort to it, they do so knowing full well its consequences." Therefore, the Hon'ble Court in the aforesaid judgment while reserving the right of the workman to go on strike was of the view that workers are not entitled to wages during the strike period irrespective of the fact that the strike is legal or illegal.

The question of deduction of wages during the period of strike was also dealt with by the three judge bench of the Hon'ble Supreme Court in Management of Chitrakulam Tea Estates (P) Ltd. vs. Its Workman AIR 1969 SC 998. In the present case the Hon'ble Court held that the factory workers are entitled to wages for the day on which they were on strike since the strike was neither illegal nor unjustified.

Further, in Syndicate Bank v. K. Umesh Nayak, AIR 1995 SC 319, the question which came up for consideration before the Constitution Bench of the Hon'ble Supreme Court was whether the workman who proceeded on strike, whether legal or illegal, are entitled to wages for the period of strike. The necessity to refer this issue to a constitution bench arose due to the apparent conflict in the views expressed by the Supreme Court in Management of Chitrakulam Tea Estates (P) Ltd. vs. Its Workman and Crompton Greaves vs. The Workmen on the one hand and Bank of India v. TS. Kelawala on the other. In the first two cases, viz., Churakulam Tea Estate and Crompton Greaves, the view taken up by Court was that the strike must be both legal and justified to entitle the workmen to wages for the period of strike whereas in TS. Kelawala the Court had taken the view that the employees are not entitled to wages for the period of strike irrespective of the fact that whether the strike is legal or illegal. The Hon'ble Court in the present case held that the question whether the strike was justified or not was not raised in T.S. Kelawala's case and therefore, the further question whether the employees were entitled to wages if the strike is justified was neither discussed nor answered. The first two decisions were not cited while deciding the other case and hence there was no occasion to consider the said decisions there. The essence of the first two decision is that if the strike is legal but unjustified or it is illegal but justified, the employees would not be entitle for wages for the period of strike. The view is that for such entitlement the strike must be both legal and justified. Since the question whether the employees are entitled to wages, if the strike is justified did not fall for consideration in T.S. Kelawala's case, there is only an apparent conflict in the decisions. Thus, the Supreme Court in the present case held that "to be entitled to wages for the strike period, the strike has to be both legal and justified. Whether the strike is legal or justified are questions of fact to be decided on evidence by the industrial adjudicator. The Hon'ble Court further observed that "while the legality of the strike is based on examining whether there is breach of the provisions of the Industrial Disputes Act, the question of justifiability of strike has to be examined by taking into consideration factors such as service conditions, nature of demands, the cause which led to the strike, urgency of the cause or the demands of the workmen, reason for not resorting to the dispute resolving machinery under the Act, etc."

Therefore, on a conjoint reading of the aforesaid observations, it is profusely clear that where a strike is not in contravention of any statutory provision and consequently is not illegal nor is unjustified, there is no reason to deprive the workmen of their wages during the period of strike. However, if the strike is either illegal or unjustified, the workmen are not entitled to any wages for the period of strike. Therefore, by virtue of number of cases in which the Hon'ble Supreme Court has repeatedly upheld this legal position, it is evident that in order to be entitled for wages during the period of strike, strike has to be both legal as well as justified.

Moreover, whether a particular strike is justified or not depends upon the facts and circumstances of each case by taking into consideration factors such as service conditions, nature of demands, the cause which led to the strike etc. A strike cannot be said to be unjustified unless the reasons for it are entirely perverse or unreasonable. Additionally, it is not only the end but the means also that must be reasonable and just.

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