CONCILIATION PROCEEDINGS

Name: Ann Issac

Roll. No.:132458

Conciliation

Definition:
International Labour organization: The practice by which the services of a neutral third party
are used in dispute as a means of helping the disputing parties to reduce the extent of their
differences and to arrive at an amicable settlement or agreed solution. It is process of rational
and orderly discussion of differences between the parties to a dispute under the guidance of a
conciliator.
Conciliation is the most important method for prevention and settlement of industrial disputes
through third party intervention. It is an attempt to reconcile the views of disputants to bring
them to an agreement. It is a process by which representatives of the workers and the
employers are brought together before a third person or a group of persons with a view to
persuade them to arrive at an agreement among themselves by mutual discussion between
them.

The conciliation machinery in India:
Conciliation Officer.
Board of Conciliation.
Court of Enquiry.
Industrial Disputes act, section 4:
Conciliation officer means a conciliation officer appointed under act. The appropriate
government may by notification in the official Gazette, appoint conciliation officers. These
Officers are charged with the duty of mediating in & promoting the settlement of industrial
dispute. The officer enjoys the power of civil court and he is expected to give Judgment
within 14 days of the commencement of the conciliation proceeding.



Duties of Conciliation Officer:
To hold conciliation Proceeding.
To investigate the dispute.
To send a report and Memorandum of settlement to appropriate govt. Where no
settlement is Arrived at.

Board of Conciliation: (ID Act sec 5)
A board consist of an independent chairman and two or four other members, representing the
parties to the dispute. The board conduct conciliation proceedings in same as the conciliation
officer. The board is however expected to submit report within two months of the date on
which the dispute was referred.
Court of Enquiry: (ID Act sec 6)
In case the conciliation fail to resolve a dispute , a court of enquiry is constituted by the
government to investigate the dispute and submit the report within six months. This body
basically is fact finding agency, constituted just to reveal the causes of the dispute and does
not care much for the settlement thereof. The report of the court shall be published by the
government within 30 days of its receipt.
Adjudication:
Adjudication involves intervention in the dispute by a third party appointed by the
government for the purpose of deciding the nature of final settlement. When the government
gets a report of the failure of conciliation, it has to decide whether it would be appropriate to
refer the dispute to adjudication.
Industrial Tribunal: (ID ACT sec 7)
The jurisdiction of Industrial Tribunal is comparatively wider than Labour Courts. The
government concern may appoint two assessors to advise the presiding officer in the
proceedings. The industrial tribunal may be appointed for a limited period on an ad hoc basis
or permanently. Award of the tribunal shall enforceable on the expiry of 30 days from the
date of publication.
Duties of Industrial Tribunal :
Wages including the period and mode of payment.
Compensatory and other allowances.
Hours of work and rest periods
Leave with wages and holidays
Bonus , profit sharing, provident fund and gratuity
Retrenchment and closure of establishment.
Case Study 1:
ACTs Involved: Payment of Bonus Act, ,1965, sections 5, ,10 and 34(3), ID Act, 1947 sec
12(1)
Respondent: Workmen
Appellant: Company
Issue:
A dispute regarding bonus payable to the workmen of the two companies for the year 1971-
72 was referred to conciliation under section 12(1) of the Industrial Disputes Act, 1947. The
workmen contended before the Conciliation officer that they were entitled to bonus
equivalent to three months' basic wages as on 31st March, 1972 as customary bonus or in any
event as bonus payable under the provisions of the Act. The companies, on the other hand,
argued that the workmen were entitled to only minimum bonus as provided under the Act.

Settlement:
The said dispute was ultimately settled before the Conciliation officer on the terms:
(a) that each eligible work man will be paid an amount equal to three months' basic wages as
on 31.3.1970;
(b) that the demand of the Union for bonus this year will be referred to a Tribunal for
adjudication. Accordingly, the Government referred the dispute for adjudication to the ninth
Industrial Tribunal of West Bengal.

After a detailed discussion of the evidence produced before the Tribunal, it found
(i) that the workmen had failed to make out the claim of customary bonus or that they were
entitled to maximum bonus of 20 per cent as provided under the Act;
(ii) that there was no available surplus during the year in question and that only the minimum
bonus was payable under the provisions of the Act.
However, after having recorded the aforesaid findings, it proceeded to hold that it was legally
open to it to substitute for the agreement entered into between the 185 parties before the
Conciliation officer a new contract and pass an award on that basis,if such a step would be
conducive to industrial peace. On this basis the Tribunal, held that there would not be material
alteration in the financial liability of the companies in case the agreement was modified by
substituting for the words "that the workmen will be paid the amount equal to three months'
basic wages as on 31.3.1970" by the words "an amount equal to basic wages as on 31.3.1372"
and accordingly it passed an award in those terms.
In appeal to the Supreme Court, the appellants challenged the legality of this award
1. The impugned award passed by the Ninth Industrial Tribunal is not legally sustainable and
has to be set aside. The rights of the workmen for payment of bonus for the year in question
will be governed by the terms of the agreement entered into before the Conciliation officer on
October 9, 1972.
2. The rights and liabilities of the parties regarding profit bonus are governed by the
provisions of the payment of Bonus Act, 1965 which are exhaustive on the subject and the
adjudication had to be conducted by the Tribunal strictly in accordance with those provisions.
In the instant case, the Tribunal has categorically found that there was no "available surplus"
in respect of the two companies for the year in question on a computation made under section
5 of the Act. The settlement entered into before the Conciliation officer constituted an
agreement under section 34(3) of the Act and but for the said agreement, the liability of the
appellants under the provisions of the Act would have been only to pay minimum bonus
under section 10 of the Act.