Unit IV — Standing Orders

“The object of the Act is to require employers in industrial establishments to define with sufficient precision the conditions of employment and to make them known to workmen.” — Industrial Employment (Standing Orders) Act, 1946 (now absorbed into IR Code 2020, Chapter IV)

Why Standing Orders Exist

Before 1946, rules of employment lived inside the manager’s head and changed with his mood. One worker could be sacked for being five minutes late while another kept his job after a week’s absence. The Standing Orders Act 1946 forced every large employer to write down the rules, get them certified by a neutral officer, and post them for all to see.

The IR Code 2020 absorbed the IESO Act 1946 into Chapter IV (Sections 28–39).

Threshold and Application — Sec. 28

IR Code change from old Act: The old IESO Act 1946 applied to establishments with 100+ workers. The IR Code 2020 raised this threshold to 300+.

The 11 First Schedule Matters

A Standing Order must cover all applicable matters from the First Schedule. An order cannot be certified if any applicable matter is omitted.

flowchart TD
    SO["First Schedule — 11 Mandatory Matters"]:::root
    SO --> M1["Classification of workers\npermanent, temporary, apprentice, probationer, badli, fixed-term"]:::matter
    SO --> M2["Hours of work, holidays, pay-days\nwage rates"]:::matter
    SO --> M3["Shift working"]:::matter
    SO --> M4["Attendance and late coming"]:::matter
    SO --> M5["Leave and holidays — conditions\nprocedure, granting authority"]:::matter
    SO --> M6["Entry by certain gates\nliability to search"]:::matter
    SO --> M7["Closing/reopening of sections\ntemporary stoppage — rights and liabilities"]:::matter
    SO --> M8["Termination of employment\nnotice required"]:::matter
    SO --> M9["Suspension/dismissal for misconduct\nwhat acts constitute misconduct"]:::matter
    SO --> M10["Means of redress against unfair treatment\nor wrongful exactions"]:::matter
    SO --> M11["Any other matter that may be prescribed"]:::matter

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The Certification Process — Sec. 30

flowchart TD
    E["Employer drafts Standing Orders"]:::start
    E --> SUB["Submit to Certifying Officer\n+ copy to workers/union — Sec. 30(1)"]:::step
    SUB --> HEAR["Certifying Officer gives hearing\nto workers/union — Sec. 30(2)"]:::step
    HEAR --> TEST{"Fairness Test — Sec. 30(6)\nAre all 11 Schedule matters covered?\nAre they otherwise in conformity with Code?"}:::decision
    TEST -->|Yes| CERT["Certify the Standing Orders\n+ send copies to parties"]:::yes
    TEST -->|No| MOD["Direct modifications\nthen certify"]:::mid
    CERT --> DATE["Date of Operation\n30 days from certification — Sec. 33"]:::final
    CERT --> POST["Must be posted at main entrance\nin English + local language — Sec. 34"]:::final

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    classDef yes fill:#D8F0D8,stroke:#2E7D32,color:#000;
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Appeal — Sec. 32

Any employer or worker aggrieved by the Certifying Officer’s order may appeal to the Appellate Authority within 60 days.

Legal Effect of Certified Standing Orders

Statutory force: Certified Standing Orders have the force of law and override any inconsistent contract of employment.

Modification of Standing Orders — Sec. 35

Certified Standing Orders cannot be modified for 6 months from the date of certification (or last modification). After that, either employer or workers may apply for modification.

Subsistence Allowance and the 90-Day Enquiry Limit — Sec. 38

When a worker is placed under suspension pending enquiry, the employer must pay subsistence allowance:

flowchart TD
    SUS["Worker suspended pending enquiry — Sec. 38"]:::root
    SUS --> A1["First 90 days of suspension\n50% of wages as subsistence allowance"]:::rule
    SUS --> A2["Beyond 90 days\n75% of wages (if delay not caused by worker)"]:::rule
    SUS --> A3["If enquiry not completed within 90 days\nand delay due to employer — worker gets 75%"]:::rule
    SUS --> A4["Worker exonerated — entitled to full back wages\nfor suspension period"]:::rule

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Model Standing Orders — Sec. 29

Where no certified Standing Orders exist (pending certification), the Model Standing Orders prescribed by the appropriate government apply automatically.

Purpose: No establishment should ever be without rules. The Model Orders fill the gap until the employer’s own orders are certified.

✏️ Sample Solved Problem (IRAC Method)

Problem: A textile factory with 500 workers has certified Standing Orders. Worker X was hired one year after certification. The employer argues X is not bound by the Standing Orders as he was not employed when they were certified. X is dismissed without following the Standing Order procedure. Is the dismissal valid?

I — Issue

Whether a worker who joins an establishment after its Standing Orders were certified is bound by those orders; and whether dismissal without following the Standing Order procedure is valid.

R — Rule

• Sec. 30(5) IR Code / Sec. 9 IESO Act 1946 — Certified Standing Orders are binding on all workers of the establishment, including those employed after certification
• Statutory force — Certified Standing Orders have the force of statute and override individual contracts — Western India Match Co. v. Workmen (1973); Bagalkot Cement Co. v. Pathan (1962)
• Sec. 30(6) — Standing Orders must provide for misconduct and termination procedure; failure to follow constitutes violation
• Natural justice — dismissal for misconduct requires a domestic enquiry following the Standing Order procedure (Workmen v. Management of Meenakshi Mills)

A — Analysis

X is employed in the establishment after the Standing Orders were certified. Under Western India Match Co., certification binds the establishment — all workers who are or become part of it are bound, regardless of when they joined. The Standing Orders are not a contract — they are statutory terms that attach to every employment in that establishment. The employer cannot argue that X, having joined later, is not covered. The dismissal procedure in the Standing Orders must be followed for all workers — hearing, show cause, domestic enquiry — before dismissal for misconduct. Bypassing this procedure makes the dismissal void or invalid.

C — Conclusion

X is bound by the certified Standing Orders. The dismissal without following the prescribed procedure is invalid. X is entitled to reinstatement or compensation. The employer must conduct a proper domestic enquiry following the Standing Order procedure before dismissing X.

📄 The full PDF bundle has 6 more problems for Unit IV — Model Standing Orders application, subsistence allowance calculation, modification procedure, the fairness test in certification, and the effect of Standing Orders on individual contracts. Get the bundle — ₹149