Trade Unions Ordinance, Industrial Disputes Act and the Termination of Employment of Workmen Act
Trade unions must register to act lawfully; the Industrial Disputes Act settles disputes by agreement, conciliation, arbitration and tribunals; TEWA requires consent or approval for non-disciplinary terminations.
Trade Unions Ordinance
A trade union is an association of workmen (or of employers) whose main purposes include regulating relations between workmen and employers and representing members in trade disputes. The Constitution guarantees the freedom to form and join a trade union. Under the Trade Unions Ordinance of 1935, registration is compulsory: a union must apply to the Registrar of Trade Unions within the time the Ordinance sets after it is formed, with its rules (name, objects, membership, use of funds, officers, accounts). A registered union must keep accounts and send annual returns. In return it can hold property and act in its registered name, and it enjoys immunities for acts done in contemplation or furtherance of a trade dispute. Registration can be cancelled for serious breaches.
Industrial Disputes Act
The Industrial Disputes Act of 1950 provides for the prevention, investigation and settlement of industrial disputes. An industrial dispute is a dispute between an employer and workmen (or between workmen) connected with employment or non-employment, terms of employment, conditions of labour, or termination of services or reinstatement. Later amendments also made certain unfair labour practices unlawful, such as dismissing a worker for trade union activity.
How an industrial dispute is settled
Separately, a dismissed workman, or his union, can apply to a Labour Tribunal for relief such as reinstatement or compensation.
Methods under the Industrial Disputes Act
| Method | How it works |
|---|---|
| Collective agreement | A written agreement between employers and a trade union on terms of employment; binding once published in the Gazette |
| Conciliation | The Commissioner of Labour or an authorised officer helps the parties reach a settlement |
| Voluntary arbitration | With both parties' consent, the dispute goes to an arbitrator whose award binds them |
| Compulsory arbitration and Industrial Court | The Minister may refer a dispute to an arbitrator or the Industrial Court; the award binds the parties |
| Labour Tribunal | A workman or his union applies for relief on termination, gratuity or other benefits; the tribunal makes a just and equitable order; appeals on questions of law go to the High Court |
Termination of Employment of Workmen (Special Provisions) Act (TEWA)
TEWA of 1971 protects job security. It applies to employers who employ at least the number of workmen the Act sets. Such an employer cannot terminate a workman's employment for any reason other than disciplinary, such as retrenchment or closure, without either the workman's prior written consent or the prior written approval of the Commissioner General of Labour. A termination in breach is illegal and void, and the Commissioner may order reinstatement with back wages. When the Commissioner approves a termination, he may order the employer to pay compensation to the workman. Disciplinary dismissals fall outside this approval rule, but the workman can challenge them before a Labour Tribunal.
The three laws at a glance
| Law | Purpose | Key feature |
|---|---|---|
| Trade Unions Ordinance (1935) | Regulate trade unions | Compulsory registration; rules, accounts, returns; immunities in trade disputes |
| Industrial Disputes Act (1950) | Prevent and settle industrial disputes | Collective agreements, conciliation, arbitration, Industrial Court, Labour Tribunals |
| TEWA (1971) | Protect workmen against non-disciplinary termination | Written consent of the workman or prior approval of the Commissioner General of Labour |
If a factory in Katunayake wants to close a production line and retrench workers, it must obtain each worker's written consent or the Commissioner General of Labour's prior written approval under TEWA. Otherwise the terminations are void and the Commissioner may order reinstatement with back wages.
Short answer: “What is an industrial dispute?” A dispute between an employer and workmen, or between workmen, connected with employment or non-employment, terms of employment, conditions of labour, or termination or reinstatement.
Structured question: “Explain the main features of the Termination of Employment of Workmen (Special Provisions) Act.” Purpose; covered employers; no non-disciplinary termination without the workman's written consent or the Commissioner General's prior written approval; void otherwise, reinstatement and back wages; compensation; disciplinary cases to Labour Tribunal.
Essay: “Explain the methods of settling industrial disputes under the Industrial Disputes Act.” Define an industrial dispute; explain collective agreements, conciliation, voluntary arbitration, compulsory arbitration and the Industrial Court, and Labour Tribunals; draw the flow; note the role of trade unions.
Dispute ladder B-C-A-C-T: Bargaining (collective agreement), Conciliation, Arbitration, industrial Court, Labour Tribunal. TEWA = consent or Commissioner before non-disciplinary termination.