The Trade Union Act, 1926 - (Case laws) Registration of Trade Union - Rights And Liabilities Of Registered Trade Unions

(ii) in relation to any trade union, the Registrar appointed for the state in which the head or registered office, as the case may be, of the trade union is situated;

(g) "trade dispute" means any dispute between employers and workmen, or between workmen and workmen, or between employers and employers which is connected with the employment or non-employment, or the terms of employment or the conditions of labour, of any person, and "workmen" means all persons employed in trade or industry whether or not in the employment of the employer with whom the trade dispute arises; and

Trade Union [Section. 2(h)]: Trade Union means any combination, whether temporary or permanent, formed primarily for the purpose of regulating the relations between workmen and employers or between workmen and workmen or between employers and employers for imposing restrictive conditions on the conduct of any trade or business and includes any federation of two or more Trade Unions.

Provided that this Act shall not affect -

(i) any agreement between partners as to their own business;

(ii) any agreement between an employer and those employed by him as to such employment; or

(iii) any agreement in consideration of the sale of the goodwill of a business or of instruction in any profession trade or handicraft.

The law relating to the registration and protection of the Trade Unions is contained in the Trade Unions Act, 1926 which came into force with effect from 1st June 1927. The Act extends to the whole of India except the State of Jammu and Kashmir.

In common parlance, Trade Union means an association of workers in one or more occupations. Its object is the protection and promotion of the interests of the working class. Trade Unions have a home grown philosophy based on workers' experience and psychology. It grows out of the workers' day-to-day experience.

Definitions

Appropriate Government [Section. 2]: In relation to Trade Unions whose objects are not confined to one state 'the appropriate Government' is the Central Government. In relation to other Trade Unions, the 'appropriate Government' is the State Government.

Executive [Section. 2(a)]: Executive means the body of which the management of the affairs of a Trade Union is entrusted.

Trade Dispute [Section. 2(g)]: A trade dispute means any dispute between the employers and workmen, the workmen and workmen and the employers and employers which is connected with the employment or non-employment, or the terms of employment, or the conditions of labour of any person. 'Workmen' mean all persons employed in trade or industry whether or not in the employment of the employer with whom the trade dispute arises.

Trade Union [Section. 2(h)]: Trade Union means any combination, whether temporary or permanent, formed primarily for the purpose of regulating the relations between workmen and employers or between workmen and workmen or between employers and employers for imposing restrictive conditions on the conduct of any trade or business and includes any federation of two or more Trade Unions.

Provided that this Act shall not affect -

(i) any agreement between partners as to their own business;

(ii) any agreement between an employer and those employed by him as to such employment; or

(iii) any agreement in consideration of the sale of the goodwill of a business or of instruction in any profession trade or handicraft.

5. Registered Trade Union [Section. 2(e)]: A registered Trade Union means a 'Trade Union' registered under the Act.

CHAPTER II

REGISTRATION OF TRADE UNIONS

[Section 3] Appointment of Registrars.

(1) The appropriate Government shall appoint a person to be the Registrar of Trade Unions for each State.

(2) The appropriate Government may appoint as many Additional and Deputy Registrars of Trade Unions as it thinks fit for the purpose of exercising and discharging, under the superintendence and direction of the Registrar, such powers and functions of the Registrar under this Act as it may, by order, specify and define the local limits within which any such Additional or Deputy Registrar shall exercise and discharge the powers and functions so specified.

(3) Subject to the provisions of any order under sub-section (2), where an Additional or Deputy Registrar exercises and discharges the powers and functions of a Registrar in an area within which the registered office of a Trade Union is situated, the Additional or Deputy Registrar shall be deemed to be the Registrar in relation to the Trade Union for the purposes of this Act.

[Section 4] Mode of registration

Minimum Requirement of Registration of Trade Union (2001 amendment)

(1) Any seven or more members of a trade union may, by subscribing their names to the rules of the trade union and by otherwise complying with the provisions of this Act with respect to registration, apply for registration of the trade union under this Act.

Provided that no Trade Union of workmen shall be registered unless at least ten per cent. or one hundred of the workmen, whichever is less, engaged or employed in the establishment or industry with which it is connected are the members of such Trade Union on the date of making of application for registration:

Provided further that no Trade Union of workmen shall be registered unless it has on the date of making application not less than seven persons as its members, who are workmen engaged or employed in the establishment or industry with which it is connected .''.

(2) Where an application has been made under sub-section (1) for the registration of a trade union, such application shall not be deemed to have become invalid merely by reason of the fact that, at any time after the date of the application, but before the registration of the trade union, some of the applicants, but not exceeding half of the total number of persons who made the application, have ceased to be members of the trade union or have given notice in writing to the Registrar dissociating themselves from the application.

Commentary:

It is understood that any organisation to form trade union under the Trade Unions Act, 1926, it should have minimum 70 employees working in that organisation.

For the purpose of registration a minimum of seven members are necessary to form a trade union. the reason for fixation of minimum seven members is to encourage formation of more trade unions so that the trade union would grow.

Under the trade union act 1926, employers can register their trade unions.

Retired Employees Can Form Unions Under Trade Union Act 1926 : Madras High Court

[Read Judgement below]

Karur Vysya Bank Retirees' Association Vs Deputy Commissioner of Labour

Civil Miscellaneous Appeal No.2758 of 2019

Court held that

"the words used in Section 2(g) of the Act, 1926 are that the dispute between employers and employees, which means that even the past employees, i.e. employees ceased to be in employment are also entitled to be a part of Trade Union for the purpose of raising a dispute. That being the case, the Authority was not right in refusing to register the Trade Union and the order of rejection is incorrect."

"The word used under the Act, 1926 is "persons actually engaged or employed in an industry with which the Trade Union is connected" and it might be including all persons irrespective of whether they are in service or retired. When the Act itself provides for an extended meaning / definition, the Authority concerned cannot narrow the definition to simply reject the application, as it would definitely be against the very object of the Trade Unions Act itself and is also violative of Article 19(1)(c) of the Constitution of India."

The Court however clarified that the retired employees would not be permitted to "join hands" with the Association of current employees. It held that the nature of grievances faced by either of the employees were on a different path and both could not be mingled together for espousing the same to the industry with which they are actually connected.

[Section 5] Application for Registration.

Every application for registration of a trade union shall be made to the Registrar and shall be accompanied by a copy of the rules of the trade union and a statement of the following particulars, namely-

(a) the names, occupations and addresses of the members making application;

(aa) in the case of a Trade Union of workmen, the names, occupations and addresses of the place of work of the members of the Trade Union making the application;''.

(b) the name of the trade union and the address of its head office; and

(c) the titles, names, ages, addresses and occupations of the 8[office-bearers] of the trade union.

If Trade Union has already been existing for one year or more, for its registration the members should submit all the details such as general statement of the assets and liabilities of the Trade Union going to be registered by the Registrar of Trade Union.

[Section . 6] Provisions to be contained in the rules of a Trade Union (2001 amendment)

For registration of the Trade Union, provision or rules mentioned below should be followed by the member for registration of the Trade Union according to this act.

a) The name of the Trade Union.

b) The object of the Trade Union.

c) General funds of the Trade Union by its members should be properly used for Lawful purpose.

d) Maintenance of list of members in the Trade Union and their facilities to be provided.

e) Half of the members of the trade union must be the member who actually engaged in an industry with which trade union is connected.

(ee) the payment of a minimum subscription by members of the Trade Union which shall not be less than—

(i) one rupee per annum for rural workers;

(ii) three rupees per annum for workers in other unorganized sectors; and

(iii) twelve rupees per annum for workers in any other case;

f) Disciplinary action against member of the Trade Union and procedures in imposition of fines on members.

g) the manner in which the rules shall be amended, varied or rescinded;

h) the manner in which the members of the executive and the other of the Trade Union shall be elected and removed

(hh) executive members and other office bearers should be elected for the period of maximum 3 years..

i) Funds of the Trade Union should be safe guarded, annual audit is necessary, and account books should be maintained for the purpose of inspection if necessary.

j) Procedure how to wind up the Trade Union

Power to call for further particulars and to require alteration of name. [Section 7]

If Registrar is not satisfy with information provided by the members of the Trade Union going to be registered, Registrar is having power to call its members for submitting the additional and required information for registering the Trade Union.

If the Name of the Trade Union is already existed or similar to other Trade Unions names, registrar is having power to order for changing of the name.

Registration [Section 8]

All the documents submitted with details and information is correct by the members of the Trade Union going to be registered, the Registrar will register the Trade Union.

Certificate of Registration. [Section 9]

The Registrar registering a Trade Union under Section 8, shall issue a certificate of registration in the prescribed form which shall be conclusive that the Trade Union has been duly registered under this Act.

Minimum requirement about membership of a Trade Union. [Section 9A]

A registered Trade Union of workmen shall at all times continue to have not less than 10% or 100 of the workmen, whichever is less, subject to a minimum of seven, engaged or employed in an establishment or industry with which it is connected, as its members.

Cancellation of registration [Section 10] (2001 amendment)

Registrar of the Trade Union can cancel the registration of the Trade Union in following circumstances

When Trade Union registration certificate has been obtained by fraud or other illegal means.

Disobey the rules and regulation of Trade Union act.

All the provision contained in section 6 of this act not followed by the members of the Trade Union.

When there are no minimum required numbers of members in the Trade Union.

Appeal [Section 11]

If Registrar of the Trade Union stops registration of the Trade Union or withdrawal of the registration, members can appeal to Labour Court or an Industrial Tribunal, with in jurisdiction.

Court may dismiss the appeal, or pass an order directing the Registrar to register the Union and to issue a certificate of registration under the provisions of Section 9 or setting aside the order for withdrawal.

[Section13] Features of Registered Trade Union.

Registered Trade Union will have perpetual succession (will no stop after the death of the members of the Trade Union.

Every registered Trade Union will have common seal.

Every registered Trade Union can acquire and hold both movable and immovable property.

Every registered Trade Union can sue others.

Every registered Trade Union can sued by others also.

[Section 14] CERTAIN ACTS DO NOT APPLY TO TRADE UNIONS

Below mentioned acts will not apply to any registered Trade Union, had the registration of any such Trade Union under any such Act shall be void.

The Societies Registration Act, 1860.

The Cooperative Societies Act, 1912.

The Companies Act, 1956

Trade Unions can be registered only under the Trade Union Act, 1926.

Chapter III

RIGHTS AND LIABILITIES OF REGISTERED TRADE UNIONS

A registered Trade Union has the right to maintain

(a) a general fund, and

(b) a separate fund for political purposes:

But the Unions are bound to utilize the funds only for the purposes specified in the Act.

OBJECTS ON WHICH GENERAL FUNDS MAY BE SPENT [Section. 15]

The following are the purposes for which the general funds of the Union may be spent:

Payment of salaries, allowances, etc., to the office bearers of the Union.

Payment of expenses for the administration of the Union including other expenses spent on defending any legal proceedings by or against the Union.

Settlement of trade disputes.

Special allowances to the members (including dependents) of the Trade Union on account of death, sickness or accidents, etc.

Compensation to members for loss arising out of trade disputes.

Providing educational, social and religious benefits to the members.

Issue of assurance policies on the lives of members and also against sickness, accidents, unemployment, insurance, etc.

Providing for publication of periodicals for the use of which is intended for the members benefit.

Any other object that may be notified by the appropriate Government in the Official Gazette.

If funds are spent for any purposes other than the above, such expenditure is treated as unlawful and the Trade Union can be restrained by the Court for applying its funds in any other purposes.

Construction of separate fund for political purposes [Section. 16]

Apart from the primary objects, a Trade Union may have certain other political objects. As per Sec. 16 a registered union may constitute a separate fund in addition to the general fund and the payment of such a fund shall be utilized for serving civic and political interest of its members. The fund can be utilized for the following purposes:

Holding of any meeting or distribution of any literature or document in support of any candidate for election as a member of legislative body constituted under the constitution or of any local authority.

For maintenance of any person who is a member of any legislative body constituted under the constitution.

For convening of political meeting of any kind or distribution of political literature or documents of any kind.

The registration of electors for selection of a candidate for legislative body.

The funds collected for political purposes shall not be clubbed with the general fund. No workman is compelled to contribute in this fund and the non-payment in this fund cannot be made a condition for admission to the Trade Union.

Immunity from Punishment for Criminal Conspiracy [Section. 17]:

No office bearer or member of a registered Trade Union will not be punished under the Sec .120B punishment of criminal conspiracy of the Indian Penal Code (Conspiracy cases are defined as cases in which two or more persons agree to commit a crime or to commit an illegal act.) regarding the matters of the spending the general funds for proper purpose.

Immunity from civil suit to certain cases [Section 18]:

No suit or other legal proceeding shall be maintainable in any Civil Court against any registered Trade Union in the following activities and circumstances.

Delay in the matters relating to the member of the Trade Union regarding the trade disputes like ‘contract of employment’, (is an agreement between an employer and an employee which sets out their employment rights, responsibilities and duties.)

Trade Union or its members showing interest or interfering in matters of the trade or business.

Trade Union or its members showing interest or interfering in matters of the employment of the persons.

Trade Union or its members showing interest or interfering in matters of the removal of labour.

Trade Union or its members showing interest or interfering in matters of compensating or remunerating the employees.

Registered Trade Union shall not be liable in any suit or other legal proceeding in any Civil Court for the tortious act (wrongful act) committed by the agent of the Trade Union.

Registered Trade Union is not liable for the vicarious liability (if agent commits mistake intentionally without the knowledge of the Trade Union, agent is liable but not the Trade Union)

Enforceability of agreements.[Section 19]-

Notwithstanding anything contained in any other law for the time being in force, an agreement between the members of a registered Trade Union shall not be void or voidable merely by reason of the fact that any of the objects of the agreement are in restraint of trade:

Provided that nothing in this section shall enable any Civil Court to entertain any legal proceeding instituted for the express purpose of enforcing or recovering damages for the breach of any agreement concerning the conditions on which any members of a Trade Union shall or shall not sell their goods, transact business, work, employ or be employed.

Right to inspect books of Trade Union. [Section 20 ]

The account books of a registered Trade Union and the list of members thereof shall be open to inspection by office-bearer or member of the Trade Union at such times as may be provided for in the rules of the Trade Union.

Rights of minors to membership of Trade Unions.[Section 21]

Any person who has attained the age of 15 years may be a member of a registered Trade Union and enjoy all the rights of a member.

Disqualifications of office-bearers of Trade Unions. [Section 21A]

person shall be disqualified for being chosen as, and for being member of the executive or any other office-bearer of a registered Trade Union if—

he has not attained the age of 18 years;

he has been convicted by a Court in India of any offence involving moral turpitude and sentenced to imprisonment, unless a period of 5 years has elapsed since his release.

Change of name [Sec 23] - Any registered Trade Union may, with the consent of not less than 2/3rd of the total number of its members can change its name.

While Uttar Pradesh has suspended major labour laws, Madhya Pradesh has tweaked some rules amid the lockdown to spur economic activities. As per media reports, Gujarat, Tripura and many other states are following suit.

With one stroke, 38 laws were made defunct in UP for 1,000 days, and only Section 5 of Payment of Wages Act 1934, Construction Workers Act 1996, Compensation Act 1993 and Bonded Labour Act 1976 remain functional, it added.

The laws that have been suspended include Trade Union Act 1926, Industrial Disputes Act 1947, Act on Occupational Safety and Health, Contract Labour Act, Interstate Migrant Labour Act, Equal Remuneration Act 1976, Maternity Benefit Act 1961 etc, it said.

• • AMALGAMATION OF TRADE UNIONS - [Section 24] Any 2 or more registered Trade Unions may become amalgamated together as one Trade Union with or without dissolution or division of the funds of such Trade Unions or either or any of them, provided that the votes of at least one-half of the members of each or every such Trade Union entitled to vote are recorded, and that at least 60% of the votes recorded are in favor of the proposal. Notice of change of name or amalgamation.- [Section 25] in case of change in the name of the Trade Union, written notice of the change of name must be signed by secretary and 7 member of the Trade Union are required to sent to registrar of the Trade Union.

  • in case of an amalgamation of the Trade Union, written notice of an amalgamation must be signed by secretary and 7 member of the Trade Union are required to sent to registrar of the Trade Union.

  • Trade Union name should not match with the other Trade Union names.

  • If Registrar satisfies with all requirements provided by the members of Trade Union, Registrar will change the name and the same entered in the register.

  • If Registrar satisfies with all requirements provided by the members of Trade Unions, Registrar will validate amalgamation and entered in the register.

Effects of change of name and of amalgamation.[Section 26]-

(1) The change in the name of a registered Trade Union shall not a affect any rights or obligations of the Trade Union or render defective any legal proceeding by or against the Trade Union, and any legal proceeding which might have been continued or commenced by or against it by its former name may be continued or commenced by or against it by its new name.

(2) An amalgamation of two or more registered Trade Unions shall not prejudice any right of any of such Trade Unions or any right of a creditor of any of them.

Dissolution of Trade Union [section. 27]

• • notice of dissolution signed by secretary and 7 member of the Trade Union, should be sent to the Registrar of the Trade Union within 14 days from the date of the dissolution of the Trade Union.

  • If registrar satisfies with provisions and rules followed by the members of the Trade Union for dissolution, he will confirm the dissolution.

  • Funds shall be divided by the Registrar among its members if there is no rules mention by the Trade Union in distribution of the funds.

Returns. [Section 28] -

(1) There shall be sent annually to the Registrar, on or before such date as may be prescribed, a general statement, audited in the prescribed manner, of all receipts and expenditure of every registered Trade Union during the year ending on the 31st day of December next preceding such prescribed date, and of the assets and liabilities of the Trade Union existing on such 31st day of December. The statement shall be prepared in such form and shall comprise such particulars as may be prescribed.

(2) Together with the general statement there shall be sent to the Registrar a statement showing all changes of office-bearers made by the Trade Union during the year to which the general statement refers, together also with a copy of the rules of the Trade Union corrected up to the date of the despatch thereof to the Registrar.

(3) A copy of every alteration made in the rules of a registered Trade Union shall be sent to the Registrar within fifteen days of the making of the alteration.

(4) For the purpose of examining the documents referred to in sub-sections (1), (2) and (3), the Registrar, or any officer authorised by him, by general or special order, may at all reasonable times inspect the certificate of registration, account books, registers, and other documents, relating to a Trade Union, at its registered office or may require their production at such place as he may specify in this behalf, but no such place shall be at a distance of more than ten miles from the registered office of a Trade Union.

CHAPTER IV -

REGULATIONS

Power to make regulations. [Section 29] -

(1) The appropriate Government may make regulations for the purpose of carrying into effect the provisions of this Act.

(2) In particular and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters, namely: -

(a) the manner in which Trade Unions and the rules of Trade Unions shall be registered and the fees payable on registration;

(b) the transfer of registration in the case of any registered Trade Union which has changed its head office from one State to another;

(c) the manner in which, and the qualifications of persons by whom, the accounts of registered Trade Unions or of any class of such Unions shall be audited;

(d) the conditions subject to which inspection of documents kept by Registrars shall be allowed and the fees which shall be chargeable in respect of such inspections; and

(e) any matter which is to be or may be prescribed.

Publication of regulations.[Section 30]-

(1) The power to make regulations conferred by section 29 is subject to the condition of the regulations being made after previous publication.

(2) The date to be specified in accordance with clause (3) of section 23 of the General Clauses Act, 1897 (10 of 1897), as that after which a draft of regulations proposed to be made will be taken into consideration shall not be less than three months from the date on which the draft of the proposed regulations was published for general information.

(3) Regulations so made shall be published in the Official Gazette, and on such publication shall have effect as if enacted in this Act.

CHAPTER V -

PENALTIES AND PROCEDURE

Supplying false information regarding Trade Unions. [Section 32]- Any person who, with intent to deceive, gives to any member of a registered Trade Union or to any person intending or applying to become a member of such Trade Union any document purporting to be a copy of the rules of the Trade Union or of any alterations to the same which he knows, or has reason to believe, is not a correct copy of such rules or alterations as are for the time being in force, or any person who, with the like intent, gives a copy of any rules of an unregistered Trade Union to any person on the pretence that such rules are the rules of a registered Trade Union, shall be punishable with fine which may extend to two hundred rupees.

Failure to submit returns. [Section 31]-

(1) If default is made on the part of any registered Trade Union in giving any notice or sending any statement or other document as required by or under any provision of this Act, every office-bearer or other person bound by the rules of the Trade Union to give or send the same, or, if there is no such office-bearer or person every member of the executive of the Trade Union, shall be punishable, with fine which may extend to five rupees and, in the case of a continuing default, with an additional fine which may extend to five rupees for each week after the first during which the default continues:

Provided that the aggregate fine shall not exceed fifty rupees.

(2) Any person who wilfully makes, or causes to be made, any false entry in, or any omission from, the general statement required by section 28, or in or from any copy of rules or of alterations of rules sent to the Registrar under that section, shall be punishable with fine which may extend to five hundred rupees.

Supplying false information regarding Trade Unions.[Section 32]- Any person who, with intent to deceive, gives to any member of a registered Trade Union or to any person intending or applying to become a member of such Trade Union any document purporting to be a copy of the rules of the Trade Union or of any alterations to the same which he knows, or has reason to believe, is not a correct copy of such rules or alterations as are for the time being in force, or any person who, with the like intent, gives a copy of any rules of an unregistered Trade Union to any person on the pretence that such rules are the rules of a registered Trade Union, shall be punishable with fine which may extend to two hundred rupees.

Cognizance of offences.[Section 33] -

(1) No Court inferior to that of a Presidency Magistrate or a Magistrate of the first class shall try any offence under this Act.

(2) No Court shall take cognizance of any offence under this Act, unless complaint thereof has been made by, or with the previous sanction of, the Registrar or, in the case of an offence under section 32, by the person to whom the copy was given, within six months of the date on which the offence is alleged to have been committed.