Unit III — Trade Unions

“The Trade Unions Act was passed to provide for the registration of Trade Unions and to confer on registered unions certain immunities.” — Preamble, Trade Unions Act, 1926 (now absorbed into IR Code 2020)

History — How Trade Unions Got Legal Protection

1920: Buckingham & Carnatic Mills workers struck under B.P. Wadia. Mill owners sued union leaders for conspiracy and breach of contract. Madras HC granted an injunction against the union. Without legal protection, union activity was merely a civil wrong.

Result: Demand for protective statute → Trade Unions Act, 1926 born. The same year (1920) also saw the formation of AITUC (All India Trade Union Congress) — India’s first central trade union body.

2020: The IR Code 2020 absorbed the TU Act 1926 entirely into Chapter III (Sections 5–27).

What is a Trade Union? — Sec. 2(zl) IR Code

Any combination — whether temporary or permanent — formed primarily for the purpose of:

• Regulating the relations between workers and employers, OR
• Regulating relations between workers inter se, OR
• Imposing restrictive conditions on the conduct of any trade or business

flowchart TD
    TU["Trade Union — Sec. 2(zl) IR Code"]:::root
    TU --> F1["Can be temporary or permanent"]:::feat
    TU --> F2["Formed primarily to regulate relations\nbetween workers and employers"]:::feat
    TU --> F3["OR between workers inter se"]:::feat
    TU --> F4["OR to impose restrictive conditions\non conduct of trade/business"]:::feat
    TU --> NOT["NOT a trade union if formed primarily\nfor political or social purposes"]:::excl

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Registration — Sec. 6–9 IR Code

Who Can Apply

What the Registrar Does

flowchart TD
    APP["Application for Registration — Sec. 6"]:::start
    APP --> REG["Registrar examines application\nand rules (constitution)"]:::step
    REG -->|Complies| CERT["Certificate of Registration — Sec. 8\nConclusive proof of registration"]:::yes
    REG -->|Defect| REQ["Registrar calls for correction\n(cannot refuse without opportunity)"]:::mid
    REQ -->|Corrected| CERT
    REQ -->|Not corrected| REF["Refusal — with reasons — Sec. 9(4)"]:::no
    REF --> APP2["Appeal to Tribunal — Sec. 10"]:::appeal

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    classDef step fill:#E6F3FF,stroke:#1E3A8A,color:#000;
    classDef yes fill:#D8F0D8,stroke:#2E7D32,color:#000;
    classDef mid fill:#FFF8E1,stroke:#F57F17,color:#000;
    classDef no fill:#FFE4E1,stroke:#8B0000,color:#000;
    classDef appeal fill:#ADD8E6,stroke:#1E3A8A,color:#000;
    linkStyle default stroke:#888,stroke-width:1px;

The Three Immunities of a Registered Union — Sec. 17–19

flowchart TD
    IMM["Three Immunities — Registered Trade Union"]:::root
    IMM --> C1["Civil Immunity — Sec. 17\nNo civil suit for acts in contemplation\nor furtherance of a trade dispute\n— Tort of inducing breach of contract protected"]:::imm
    IMM --> C2["Criminal Immunity — Sec. 18\nAgreement by members in furtherance\nof lawful objects NOT criminal conspiracy"]:::imm
    IMM --> C3["Protection of Funds — Sec. 19\nOfficers not criminally liable\nfor acts of union — personal liability protected"]:::imm

    classDef root fill:#FFF8DC,stroke:#000,stroke-width:1px,color:#000;
    classDef imm fill:#ADD8E6,stroke:#1E3A8A,color:#000;
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Limits on immunity: Only applies to lawful acts and registered unions. An unregistered union has no immunity. Immunity does not cover violence, intimidation, or fraud.

General Fund vs Political Fund — Sec. 15–16

Key rule: A member who does not contribute to the Political Fund cannot be penalised or deprived of union benefits — Sec. 16(3).

Recognition — Negotiating Union — Sec. 14

Under the IR Code 2020, a Negotiating Union (or Council) has the exclusive right to bargain on behalf of all workers.

flowchart TD
    REC["Recognition as Negotiating Union — Sec. 14"]:::root
    REC --> T1["Apply to employer — 51% membership in establishment\nfor sole negotiating union status"]:::cond
    REC --> T2["If multiple unions — joint negotiating council\nformed of unions with at least 20% each"]:::cond
    REC --> T3["Employer must recognize within 45 days\nof application"]:::cond
    REC --> T4["Recognition valid for 3 years"]:::detail
    REC --> T5["If dispute — Industrial Tribunal decides"]:::detail

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Collective Bargaining

Collective Bargaining = process where the recognised/negotiating union and employer negotiate terms of employment on behalf of all workers.

Cancellation of Registration — Sec. 9

A registered trade union’s certificate may be cancelled by the Registrar if:

• The union applies for voluntary cancellation
• The certificate was obtained by fraud or misrepresentation
• The union has ceased to exist
• The union contravenes any provision of the Code

Cancellation requires notice and opportunity of hearing. The union may appeal to the Industrial Tribunal — Sec. 10.

✏️ Sample Solved Problem (IRAC Method)

Problem: A registered trade union in a textile mill calls a strike demanding wage revision. The mill owner sues the union office-bearers for damages in civil court, claiming they induced workers to break their employment contracts. Is the suit maintainable?

I — Issue

Whether a civil suit for damages against the office-bearers of a registered trade union for inducing workers to strike is barred by the immunity provisions of the IR Code 2020.

R — Rule

• Sec. 17 IR Code (old Sec. 18 TU Act 1926) — No suit or other legal proceeding shall be maintainable in any civil court against any registered trade union or its office-bearers in respect of any act done in contemplation or furtherance of a trade dispute, if such act would be actionable only on the ground that it induces another person to break a contract of employment
• The immunity applies only to registered unions and lawful acts in furtherance of a trade dispute
• The strike must not involve violence, intimidation or fraud for the immunity to apply

A — Analysis

The union is registered. The strike is for wage revision — a classic trade dispute under Sec. 2(q). Inducing workers to stop work (i.e., go on strike) is precisely what Sec. 17 immunises against — the tort of inducing breach of employment contracts. The employer is trying to use civil courts to do what the legislature has expressly prohibited. So long as the strike was called through lawful means — notice, assembly, peaceful persuasion — and the union did not use violence or intimidation, the civil immunity is complete.

C — Conclusion

The suit is not maintainable. Sec. 17 of the IR Code grants a registered trade union and its office-bearers complete civil immunity for acts done in contemplation or furtherance of a trade dispute, including inducing workers to participate in a strike. The employer’s remedy, if the strike is illegal, is under the IR Code’s machinery — not a civil suit for damages.

📄 The full PDF bundle has 6 more problems for Unit III — Political Fund opt-out, recognition of Negotiating Union, collective bargaining settlement enforcement, dissolution of union, and amalgamation of unions. Get the bundle — ₹149