Trade Union ACT NOTES for llb law students

notes

1. Trade Union ACT NOTES
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Trade Union ACT NOTES
Commercial Arbitration LLM (Christ (Deemed To Be University))
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Studocu is not sponsored or endorsed by any college or university
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2. he Trade Unions Act, 1926 is a signi�cant piece of legisla�on in India that provides a legal framework
for the forma�on, registra�on, and regula�on of trade unions. It was enacted to empower workers,
especially in the organized sector, to organize themselves and nego�ate collec�vely with employers
Amendments and Recognition:
The Trade Unions (Amendment) Act, 1947 sought to introduce Chapter III-A, which
would outline conditions for mandatory recognition of trade unions. However, this
chapter was never enforced, meaning that recognition remains largely discretionary.
This lack of mandatory recognition for trade unions in India highlights a gap in the
legal framework, particularly for workers in the unorganized sector who may face
significant challenges in bargaining collectively.
Definition of Appropriate Government
1.Central Government:
oThe Central Government is responsible for trade unions whose activities and
objectives extend beyond the boundaries of a single state.
oExample: If a trade union represents workers in multiple states, such as a
national trade union for railway workers or a union for employees of a
multinational corporation, it falls under the jurisdiction of the Central
Government.
2.State Government:
oThe State Government is responsible for trade unions whose activities are
confined to a single state.
oExample: A trade union that represents workers only in a local manufacturing
plant in Kerala would be regulated by the State Government of Kerala.
A trade dispute refers to any disagreement or conflict that arises in the
workplace. This conflict can occur between:
1.Employers and Workmen: This includes issues like disputes over
working conditions, pay, hours, or job security.
2.Workmen and Workmen: This can involve conflicts among employees
themselves, such as disagreements over pay differences or working
conditions.
3.Employers and Employers: This involves disagreements between
different employers regarding practices that affect workers or competition
for employees.
Key Points
Connected to Employment: The disputes are related to whether
someone is employed or not, the terms of their employment (like salary
or benefits), or the conditions under which they work (like safety
measures).
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3. Involves Workmen: The term “workmen” includes all individuals
working in trade or industry, regardless of whether they are directly
employed by the employer involved in the dispute.
Examples of Non-Employment Situations
1.Wrongful Termination:
oExample: An employee believes they were fired without just cause or without
following due process (e.g., not receiving proper warnings or an opportunity to
improve). The employee might file a grievance against the employer, claiming
wrongful termination, which constitutes a trade dispute involving non-
employment.
2.Refusal to Hire:
oExample: A qualified candidate applies for a job but is not selected. They
believe the rejection was based on discriminatory factors (such as ethnicity or
gender). The individual could initiate a dispute against the employer, alleging
that their non-employment is unjust
The definition of a “Trade Union” outlines its primary purpose, structure, and the legal
boundaries of its operation. Here's a breakdown of the definition, along with examples for
clarity:
Simplified Interpretation
1.Combination of Individuals:
oA trade union is formed by a group of individuals (workers) who come
together, either temporarily or permanently, to address their collective
interests.
2.Primary Purpose:
oThe main goals of a trade union include:
Regulating Relations: Managing relationships between:
Workmen and Employers: Negotiating wages, working
conditions, and benefits.
Workmen and Workmen: Ensuring fair treatment among
employees.
Employers and Employers: Establishing fair competition and
standards within an industry.
Imposing Restrictive Conditions: Setting rules or standards that
govern how trades or businesses operate to protect members' interests.
3.Includes Federations:
oThe definition also encompasses federations, which are unions formed by two
or more trade unions joining together for collective action or representation.
4.Exceptions (Provided that):
oThe definition states that certain agreements are not affected by the provisions
of the Act:
Partnership Agreements: Any agreement between business partners
regarding their operations is excluded.
Employment Agreements: Direct agreements between employers and
their employees regarding employment terms are excluded.
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4. Sale of Goodwill: Agreements related to the sale of a business’s
goodwill or training in a profession are also excluded.
Examples
1.Regulating Relations Between Workmen and Employers:
oExample: A manufacturing company has a trade union representing its
workers. The union negotiates with management for higher wages and
improved safety standards in the workplace. This interaction reflects the
union's role in regulating relations between workmen and their employer.
2.Regulating Relations Between Workmen and Workmen:
oExample: In a hospital, a group of nurses forms a trade union to address
issues related to unfair workloads and wage disparities among different
nursing staff. By working together, they advocate for equitable pay and
working conditions, representing the interests of all nurses.
3.Imposing Restrictive Conditions on Conducting Trade:
oExample: A union in the construction industry may establish guidelines
regarding the number of hours a worker can be on-site without a break. This
restriction helps ensure workers’ safety and well-being, showcasing the
union's role in imposing conditions on trade practices.
4.Federation of Trade Unions:
oExample: If several trade unions from different industries (like transportation,
healthcare, and education) come together to form a federation, they can
collectively negotiate better labor laws and share resources to strengthen their
bargaining power.
5.Exclusions:
oPartnership Agreements: If two business partners running a restaurant agree
on profit-sharing, this agreement is outside the scope of trade union
regulations.
oEmployment Agreements: A company negotiates directly with its workers
about a pay raise, which does not involve the trade union. This agreement is
also not governed by trade union regulations.
oSale of Goodwill: If a business owner sells their company and includes
training for the new owner as part of the sale, this transaction is unaffected by
trade union regulations.
Conclusion
In summary, a trade union is a collective organization formed by workers to advocate for
their interests in relation to their employers and each other. While trade unions play a crucial
role in improving working conditions and negotiating better terms, certain agreements
between business partners and direct employment contracts are exempt from trade union
regulations. Understanding this definition is essential for recognizing the rights and roles of
both workers and employers in labor relations.
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5. THE TRADE UNIONS ACT, 1926
CHAPTER I- PRELIMINARY
CHAPTER II -REGISTRATION OF TRADE UNIONS
CHAPTER III -RIGHTS AND LIABILITIES OF REGISTERED TRADE UNIO NS
CHAPTER IV- REGULATIONS
CHAPTER V -PENALTIES AND PROCEDURE
1. Trade Union (Definition)
A Trade Union is essentially an organized group of workers or employers who come
together with the primary aim of improving their relationships and working conditions. It can
be temporary (formed for a specific issue) or permanent (set up to work on a long-term
basis). The main functions of a Trade Union include negotiating with employers on wages,
working conditions, and other employment-related matters.
Key Points:
Purpose: To regulate relationships:
oBetween workers and employers,
oBetween workers and workers, or
oBetween employers and employers.
Activities:
oTrade Unions work towards protecting the interests of their members (workers
or employers) by:
Negotiating better pay.
Ensuring safer working conditions.
Resolving disputes among workers or with employers.
Imposing restrictive conditions on trade or business if needed (such
as organizing a strike to make demands).
oA Trade Union can also be a federation (a group of smaller Trade Unions).
Examples:
A group of factory workers forms a permanent Trade Union to regularly negotiate
wages and benefits with management.
A group of employers in the steel industry might form a Trade Union to set industry-
wide standards on contracts and working hours.
Exclusions:
The definition excludes the following:
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6. 1.Agreements between partners in a business.
2.Agreements between employers and their employees that involve the individual
terms of employment.
3.Agreements for the sale of goodwill or instruction in a trade or profession.
Example (Exclusion): Two business partners forming an agreement to divide profits in their
partnership would not be classified as a Trade Union under this Act.
2. Trade Dispute (Definition)
A Trade Dispute refers to any conflict or disagreement that arises between:
Employers and workers, or
Workers themselves, or
Employers themselves (though this is rare), where the dispute is related to
employment, non-employment, the terms of employment, or conditions of labor.
Key Points:
Involved Parties:
oEmployers and workers (e.g., disputes over wages).
oWorkers and workers (e.g., disagreements about promotions or union
representation).
oEmployers and employers (e.g., conflicts over business agreements that affect
the labor force).
Subject Matter:
oThe trade dispute must be about matters related to employment, such as:
Hiring or firing of workers.
Working hours or overtime.
Salary, bonuses, and other terms of employment.
Work environment and safety measures.
oThe dispute must affect one or more persons engaged in trade or industry.
Example:
A group of workers in a factory may demand higher wages, leading to a strike, which
is a classic example of a trade dispute between workers and their employer.
A conflict between two groups of workers over who should represent them in
negotiations with management could also be considered a trade dispute between
workers.
Broader Scope:
The term “workmen” in this context covers all individuals employed in trade or
industry, even if they are not directly involved in the trade dispute with their
employer. This makes the definition inclusive of many workers.
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7. 3. Workmen (Definition)
The term workmen refers to all persons employed in trade or industry. It’s a broad term
that includes anyone working under an employment contract, regardless of their position or
specific duties.
Key Points:
Who is Included?
oAny person employed in any type of trade or industry, whether they are
involved in a manual, clerical, technical, or even supervisory role.
oIt includes workers who may not be involved in the actual trade dispute, but
are still employed in the relevant industry.
Example:
A factory worker, a clerk in an office, or a machine operator in an industrial plant are
all classified as workmen.
Even if these workers are not directly involved in a trade dispute with their employer,
they are still considered part of the workforce under the broader term “workmen.”
Exclusions:
The term “workmen” does not generally include individuals in managerial or
administrative roles. These individuals are often considered separate from the regular
workforce.
Example (Exclusion): A factory manager or an HR executive may not be classified as a
workman because their role involves decision-making and overseeing other employees rather
than being involved in the direct production or clerical work.
Understanding the Connections:
Trade Unions represent the collective interests of workmen and employers and are
involved in organizing, advocating for, and improving the working conditions and
rights of workmen.
Trade Disputes typically arise when there is a disagreement over employment
matters, like wages or working conditions. Trade Unions often play a critical role in
managing and resolving these disputes.
Workmen are the main beneficiaries of the activities of Trade Unions, as they are the
ones whose rights and interests are protected and advanced.
Illustrative Example:
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8. Imagine a group of textile workers in Kerala. They are members of a registered Trade
Union. They are unhappy with the long working hours and low wages offered by their
employer. The Union, representing the workers, demands a reduction in working hours and
better pay.
The employer refuses to meet these demands, and a trade dispute arises. The workers then
go on strike. This entire process of negotiation, refusal, and strike would be categorized as a
trade dispute.
In this case, all workers involved (and even those not directly involved in negotiations but
working in the factory) are considered workmen. The Trade Union’s main role here is to
ensure that the demands of these workmen are met by the employer.
(Workmen (De�ni�on)
The term workmen refers to people who are employed in any trade, industry, or business
to perform work. These workers can be involved in different types of jobs, including:
Manual labor (e.g., construction workers, factory workers),
Clerical work (e.g., office clerks),
Technical roles (e.g., machine operators, technicians).
Key Points:
1.Employment in Trade or Industry: A workman is any person hired to work in a
business, industry, or trade. They are directly involved in producing goods, providing
services, or helping the business run.
2.Job Roles: Workmen are usually involved in hands-on or supporting roles within the
business. They are the workers who carry out the tasks needed for the business to
function.
oFor example, someone working in a factory operating machinery is a
workman.
oA person working in an office doing filing and paperwork for the company is
also a workman.
3.Not Managers or Supervisors: The term does not usually include people in
managerial or administrative roles. Managers and supervisors make decisions or
oversee workmen, but they are not considered workmen themselves.
Example to Clarify:
In a car manufacturing factory:
oThe assembly line workers who build the cars are workmen because they are
directly involved in the production process.
oThe technicians who repair machines are also workmen, as they provide
technical support.
oThe office clerks who handle paperwork related to car orders and payments
are also considered workmen, even though they aren’t working directly on the
assembly line.
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9. oHowever, the factory manager who supervises the entire operation is not a
workman because their role is more about decision-making and managing the
business.
Summary:
Workmen are anyone hired to perform work in a trade, industry, or business.
They are involved in practical tasks like production, technical jobs, or clerical duties.
Managers or higher-level administrators are not considered workmen because their
duties involve overseeing or managing work rather than doing the hands-on tasks.)
Who Can Form and Register a Trade Union?
Eligible Workers:
Workers involved in Trade, Business, or Industry: These are employees who work
in sectors where goods are produced, services are provided, or commercial activities
take place. Their employment involves activities that contribute to the economy
through trade or industry.
Examples:
oFactory Workers: Employees in a car manufacturing plant.
oBank Employees: Staff working in commercial banks.
oRetail Workers: Employees in shopping malls or retail stores.
oIT Professionals: Programmers or support staff in software companies.
oMiners: Workers in coal or mineral mines.
These workers can form and register trade unions because they are engaged in activities
considered as trade or industry, where collective bargaining is applicable.
Who Cannot Form and Register a Trade Union under the Act?
Ineligible Workers:
1.Workers in Personal Services:
oDefinition: Employees who provide services of a personal or domestic nature,
often directly to individuals rather than being part of a commercial enterprise.
oExamples:
Palace Staff: Servants working in a royal palace for the royal family.
Domestic Workers: Maids, cooks, gardeners employed in private
households.
Private Chauffeurs: Drivers employed by individuals for personal
use.
oReason: Their work is personal and not part of a trade, business, or industry.
They serve individuals rather than contributing to a commercial or industrial
operation.
2.Certain Hospital Workers:
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10. oExample: Employees in a small, privately-owned clinic serving only the
owner and not operating as a commercial hospital.
oReason: If the hospital is not a commercial enterprise (e.g., it's a personal
service), the staff may not be considered as engaged in a trade or industry.
3.Civil Servants and Government Employees:
oDefinition: Individuals employed by the government to perform
administrative, executive, or judicial functions.
oExamples:
Administrative Officers: Government clerks, officers in government
departments.
Police Officers: Law enforcement personnel.
Judicial Staff: Court clerks, judges' assistants.
oReason: They are engaged in the sovereign functions of the state, which are
essential for governance and public administration. Their work is not
considered a trade or business.
Why Can't These Workers Register Trade Unions?
1.Nature of Work:
oPersonal Services: Work is of a private nature, serving individuals rather than
contributing to economic trade or industry.
oCivil Servants: Involved in governance, which requires maintaining
uninterrupted services for the public good.
2.Collective Bargaining Not Applicable:
oPersonal Service Workers: Their employers are individuals, not companies
or industries, making collective bargaining impractical.
oCivil Servants: Their employment terms are governed by laws and
regulations, not negotiable through collective bargaining.
3.Legal Interpretation:
oThe Trade Unions Act, 1926, is intended for workers in trade, business, or
industry.
o"Trade or Business" implies commercial activities aimed at profit and
involving market competition.
Court Interpretations and Examples
1.Tamil Nadu Non-Gazetted Government Officers' Union Case:
oSituation: A union of government officers applied for registration under the
Act.
oOutcome: The Registrar refused registration, and the court upheld this
decision.
oReasoning:
Government officers are civil servants, not "workmen" under the Act.
They perform sovereign functions, which are not part of trade or
business.
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11. 2.Palace Employees:
oSituation: Staff working in a royal palace wanted to form a trade union.
oOutcome: They could not register under the Act.
oReasoning:
Their work is personal service to the royal family, not part of a
commercial enterprise.
3.Employees' State Insurance (ESI) Corporation Staff:
oSituation: Employees of the ESI Corporation sought to form a trade union.
oOutcome: They were allowed to register.
oReasoning:
Although it's a government corporation, the ESI performs commercial
functions and provides services similar to a business.
Employees are considered "workmen" under the Act.
Section 3: Appointment of Registrars
1.Clause (1): The appropriate government (either Central or State Government,
depending on the trade union) must appoint a Registrar of Trade Unions for each
state.
oExample: If a trade union operates within a single state, the State
Government will appoint a Registrar for that state. If it operates across
multiple states, the Central Government will appoint the Registrar.
2.Clause (2): The government can also appoint Additional and Deputy Registrars to
assist the Registrar and handle specific responsibilities, subject to the Registrar's
supervision.
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12. oExample: If there are too many trade unions to manage, the government can
appoint multiple officials (Additional/Deputy Registrars) to oversee specific
areas within a state.
3.Clause (3): If an Additional or Deputy Registrar is in charge of the area where a trade
union's registered office is located, they will act as the Registrar for that union.
oExample: If a trade union’s registered office is in Mumbai, and a Deputy
Registrar manages that area, then that Deputy Registrar will be considered the
Registrar for the union.
Section 4: Mode of Registration
1.Clause (1): Any seven or more members of a trade union can apply for its
registration by subscribing to the union's rules and complying with the Act’s
provisions.
oExample: Seven factory workers in a manufacturing unit come together to
form a trade union to represent their collective interests. They submit an
application for registration by following the necessary rules.
2.Clause (2): If some of the applicants leave the union before it is officially registered,
the application doesn’t become invalid, provided that less than half of the original
applicants have left.
oExample: If seven members apply for registration and two of them leave
before the registration is complete, the application remains valid
(If at the �me of applica�on for registra�on of a trade union there are 7 members, and later some of
them leave (but not more than half), the registra�on process will s�ll remain valid.
As per Section 4(2) of the Trade Unions Act, 1926, if fewer than half of the original
applicants withdraw or dissociate themselves after the application is made, the application
will not become invalid.
Example:
If 7 members apply for registration and later 2 members leave or dissociate
themselves, the registration process continues because 5 members (more than half)
are still involved.
However, if more than half of the members (e.g., 4 or more) leave before the registration is
complete, the application could become invalid, and the remaining members would need to
take steps to either reapply or gather more support.)
Section 5: Application for Registration
1. Every application for the registration of a trade union must include:
oNames, occupations, and addresses of the applicants.
oThe name of the trade union and the address of its head office.
oThe names, ages, addresses, and occupations of the office-bearers (like
president, treasurer) of the union.
oExample: The seven members applying for registration of their trade union,
"Factory Workers Union," submit an application with details of their
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13. occupations (e.g., assembly line worker, technician) and the union’s head
office address.
2. If the union has existed for over a year before registration, it must also submit a
statement of its assets and liabilities.
oExample: If the union has been operating informally for more than a year and
has collected membership fees, it must provide details of its financial standing
when applying for formal registration.
Section 6: Provisions to be Contained in the Rules of a Trade Union
For a trade union to be registered, its rules must include the following provisions:
(a) Name of the Trade Union.
Example: The union’s name could be “Textile Workers Union.”
(b) Objects of the Trade Union: The objectives for which the union is established.
Example: The objective might be to protect workers' rights regarding working
conditions, wages, and safety.
(c) The purposes for which the union’s general funds can be used, which must comply with
the law.
Example: The funds can be used for activities like legal representation for workers or
organizing meetings but not for purposes unrelated to the union’s goals.
(d) The union must maintain a list of its members, with provisions for the inspection of this
list by members and office-bearers.
Example: A record of all members must be kept and available for inspection by
members of the union if they wish to see it.
(e) Provisions for admitting ordinary members (workers engaged in the relevant industry)
and some honorary or temporary members who are office-bearers.
Example: The union’s rules must allow for admitting factory workers as regular
members and perhaps a retired worker as an honorary member who serves as a
president.
(f) Conditions for benefits to members and any fines or penalties.
Example: Rules might state that members can access financial support in case of
injury at work, or face fines for not paying membership fees on time.
(g) Rules on how the union’s rules can be amended or changed.
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14. Example: The union’s rules might be amended by a two-thirds majority vote at an
annual general meeting.
(h) Provisions on how office-bearers are appointed or removed.
Example: Elections might be held annually to choose new office-bearers.
(i) Safe custody of the union’s funds, annual audits, and inspection of account books.
Example: The union’s treasurer is responsible for ensuring that funds are safely
deposited in a bank and accounts are audited yearly.
(j) How the trade union can be dissolved.
Example: The union can only be dissolved if a two-thirds majority of members vote
for dissolution.
Section 7: Power to Call for Further Particulars and Require Alteration of Name
1. The Registrar can request additional information to ensure the application complies
with the law before registering the trade union.
oExample: The Registrar may ask for clarification if the union’s objectives are
not clearly stated in the application.
2. If the name of the union is too similar to an existing one, the Registrar can require it
to be changed.
oExample: If the union's proposed name is “All India Workers Union,” but a
similarly named union already exists, the Registrar can ask the applicants to
choose a different name.
Section 8: Registration
Once the Registrar is satisfied that the union has met all the requirements, the trade
union is registered. The union’s details are entered into the official register.
Section 9: Certificate of Registration
After registration, the Registrar issues a certificate of registration, which serves as
conclusive proof that the trade union is registered under the law.
Section 10: Cancellation of Registration
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15. A trade union’s registration can be canceled if:
The union requests it.
The registration was obtained by fraud or mistake.
The union violates the law or its own rules.
The union ceases to exist.
Before canceling registration, the Registrar must give the union at least two months' notice.
Before cancelling registration, the Registrar must provide the union with at least two months'
notice stating the grounds for cancellation. The union can appeal the cancellation in court,
and the case may be heard by a High Court or civil court depending on the union's location
Section 11: Appeal
1. If the Registrar refuses to register a union or cancels its registration, the union can
appeal:
oTo the High Court (if the union’s head office is in a major city).
oTo a lower court (if outside a major city).
2. The appellate court can either uphold the Registrar’s decision or order the union to
be registered.
Section 12: Registered Office
All communications and notices to a trade union should be addressed to its registered office.
If the office location changes, the Registrar must be informed within 14 days.
Section 13: Incorporation of Registered Trade Unions
A registered trade union becomes a legal entity (a corporation) with:
Perpetual succession: It continues to exist even if its members change.
A common seal: Official documents are stamped with the union’s seal.
The ability to acquire property and enter into contracts.
The right to sue or be sued.
Section 14: Exemption from Certain Acts
Certain acts, like the Societies Registration Act, 1860 and the Companies Act, 1956, do not
apply to registered trade unions. Thus, trade unions cannot be registered under these acts.
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16. Chapter III of the Trade Unions Act, 1926: Rights and Liabilities of Registered Trade
Unions
Here’s a detailed explanation of each section and clause:
Section 15: Objects on which General Funds may be Spent
This section outlines how a registered trade union can use its general funds. The money can
only be spent on specific activities that benefit the union or its members. These include:
(a) Payment of salaries and expenses for office-bearers: The funds can be used to pay the
salaries, allowances, and expenses of the trade union's office-bearers (people who hold a
position of authority or responsibility).
(b) Administrative expenses: The trade union can use funds for day-to-day operations,
including auditing the union's financial accounts.
(c) Legal proceedings: Funds can be used to pay for legal action in cases where the trade
union or any of its members is a party. The legal proceedings must relate to protecting rights
connected to the trade union or employer-employee relations.
(d) Trade disputes: Funds can be used to conduct trade disputes on behalf of the union or
any of its members.
(e) Compensation for trade disputes: If any member suffers a loss due to a trade dispute,
the union can compensate them using its funds.
(f) Member allowances (e.g., for sickness, accidents, unemployment): The funds can be
used to provide financial support to members or their dependents in cases of death, old age,
sickness, accidents, or unemployment.
(g) Insurance policies for members: The union can take out life insurance or accident
insurance for its members, or to insure against sickness and unemployment.
(h) Educational, social, or religious benefits: Funds can be used to provide these benefits to
members, including paying for funeral or religious ceremonies for deceased members or their
dependents.
(i) Publishing periodicals: The union may spend on publishing magazines or newsletters that
discuss issues related to employers or workers.
(j) Contributions to causes benefiting workers: The trade union can make contributions to
causes that benefit workers in general. However, the amount spent on this cannot exceed 25%
of the union’s total annual income.
(k) Other objects as notified by the government: If the government specifies other
purposes through official notification, the funds can be spent on those purposes.
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17. Section 16: Constitution of a Separate Fund for Political Purposes
This section allows trade unions to create a separate political fund to support members’
political activities. The money for this fund has to be collected separately, and only those
members who want to contribute will do so.
(1) Creation of a political fund: The trade union can set up a fund to promote the political
and civic interests of its members. This is separate from the general funds and must come
from voluntary contributions.
(2) Political activities the fund can support:
(a) Pay for expenses incurred by a member standing for election to any legislative or
local authority.
(b) Hold meetings or distribute literature supporting any candidate for election.
(c) Maintain any person who is a member of a legislative body or local authority.
(d) Register voters or select candidates for elections.
(e) Hold political meetings or distribute political literature of any kind.
(3) Voluntary contributions: No member is forced to contribute to this fund. If a member
does not contribute, they will not be excluded from any of the union's benefits, except those
related to managing or controlling the fund.
Section 17: Criminal Conspiracy in Trade Disputes
This section protects trade union members from being charged with criminal conspiracy
under Section 120B of the Indian Penal Code for entering into agreements related to trade
union objectives (as defined in Section 15).
However, this protection does not apply if the agreement involves committing an offense
(e.g., illegal activities or violent acts).
Section 18: Immunity from Civil Suit in Certain Cases
This section provides immunity to registered trade unions and their office-bearers or
members from being sued in civil courts for certain acts committed during trade disputes.
(1) Immunity from civil suits: Trade unions cannot be sued for inducing someone to break
an employment contract or for interfering in someone’s trade or business, as long as the act is
done in contemplation or furtherance of a trade dispute.
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18. (2) Immunity from tortious acts: If a trade union’s agent (representative) does something
wrongful (a tort) during a trade dispute, the union is not liable as long as the action was
without the knowledge of or against the instructions of the union's executive.
Section 19: Enforceability of Agreements
Agreements between members of a registered trade union cannot be considered void or
illegal simply because they aim to restrict trade.
However, courts cannot enforce agreements related to conditions about members selling
goods, doing business, or being employed. Trade unions cannot sue for damages if such
agreements are violated.
Section 20: Right to Inspect Books of Trade Union
Members and office-bearers of a trade union have the right to inspect the union's financial
records and list of members during times stipulated in the union's rules.
Section 21: Rights of Minors to Membership of Trade Unions
A person who is at least 15 years old can become a member of a trade union and enjoy all
rights of membership, unless the trade union's rules say otherwise. They can also sign
documents and receive payments as needed under the union’s rules.
Section 21A: Disqualifications of Office-Bearers of Trade Unions
This section outlines conditions that disqualify a person from holding office in a trade union.
(1) A person cannot be an office-bearer if:
They are under 18 years of age.
They have been convicted of an offense involving moral turpitude (serious crimes
involving dishonesty) and imprisoned, unless five years have passed since their
release.
(2) Any existing office-bearer convicted before the 1964 amendment must resign unless five
years have passed since their release from imprisonment.
Section 22: Proportion of Office-Bearers to be Connected with the Industry
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19. At least half of the office-bearers of a trade union must be individuals who are actually
employed in the industry with which the union is associated.
However, the government can waive this requirement for specific unions or classes of unions.
Section 23: Change of Name
A trade union can change its name if two-thirds of its members agree, and it must follow the
procedure laid out in Section 25.
Section 24: Amalgamation of Trade Unions
Two or more registered trade unions can merge to form one union, provided:
At least half of the members of each union vote.
60% of those voting approve the merger.
Section 25: Notice of Change of Name or Amalgamation
A written notice of any name change or amalgamation must be sent to the Registrar of Trade
Unions. If the name is similar to an existing union, the Registrar can refuse registration.
Section 26: Effects of Change of Name and Amalgamation
Changing the name of a union or merging with other unions does not affect its legal rights,
obligations, or any ongoing legal proceedings.
Section 27: Dissolution
When a trade union dissolves, a notice signed by the Secretary and seven members must be
sent to the Registrar within 14 days. If the union’s rules do not provide instructions on
dividing its funds, the Registrar will decide how the funds should be distributed among
members.
Section 28: Returns
Every year, trade unions must send a general statement of accounts to the Registrar, showing:
Receipts and expenditure.
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20. Assets and liabilities as of December 31 of the previous year. The statement must
also list changes in office-bearers and any changes made to the union's rules.
This detailed breakdown covers each clause in Chapter III of the Trade Unions Act, 1926,
focusing on the rights and liabilities of registered trade unions
Section 10 of the Trade Unions Act, 1926 discusses the conditions under which the
certificate of registration of a trade union can be withdrawn or cancelled by the Registrar
of Trade Unions. A trade union, once registered, gains legal status and certain rights, but if
certain conditions are violated, the certificate can be revoked. Here's a detailed breakdown of
this section:
Grounds for Cancellation or Withdrawal of Registration
1.Application by the Trade Union (Clause a):
oA trade union itself can request that its certificate of registration be
withdrawn or cancelled.
oThis request must be verified in a manner prescribed by law. It means there
are specific procedures or formalities that the trade union must follow to
ensure that this request is genuine and legitimate.
oThe union might choose to dissolve or voluntarily surrender its registration if
it no longer wishes to function as a trade union.
2.Action by the Registrar (Clause b):
oThe Registrar of Trade Unions can take action without an application from
the trade union, based on the following reasons:
i. Certificate Obtained by Fraud or Mistake:
If the Registrar discovers that the registration was obtained through
fraud (deliberate deception) or mistake, they can cancel the
certificate. This ensures that the registration process is legitimate and
that trade unions cannot be formed on false grounds.
ii. Trade Union Ceased to Exist:
If the trade union has ceased to exist, meaning it is no longer
operational or functioning, the Registrar can cancel its registration.
This happens when a union dissolves, disbands, or stops carrying out
its activities.
iii. Contravention of the Act:
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21. If the trade union has willfully violated any provision of the Trade
Unions Act despite being notified by the Registrar, the certificate can
be cancelled. This ensures that trade unions follow the law and do not
engage in prohibited activities.
iv. Continuing Inconsistent Rules:
If the trade union allows any rule to remain in force that is
inconsistent with the provisions of the Trade Unions Act, the
Registrar can cancel the certificate. This could refer to internal rules of
the trade union that go against the legal requirements under the Act.
For example, if a union’s rules on membership or elections violate the
principles laid out in the Act, the Registrar may take action.
v. Rescinding a Required Rule:
If the union has rescinded (canceled) any rule that is required by
Section 6 of the Act, the Registrar can cancel its registration. Section 6
outlines the matters for which every registered trade union must have
rules. These include rules regarding membership, conduct of elections,
and the manner in which decisions are made.
For instance, if the trade union cancels its rule regarding the holding of
regular elections, which is a mandatory requirement, the Registrar can
act.
Notice Period (Proviso):
Before the Registrar cancels or withdraws the registration certificate without the
union's application, they are required to give the trade union a written notice.
oThis notice must specify the grounds on which the Registrar is considering
the cancellation or withdrawal.
oThe trade union must be given at least two months’ notice in writing. This
allows the trade union time to correct any violations or respond to the
Registrar's concerns.
oIf the trade union fails to address the issue or provide a satisfactory
explanation, the Registrar can then proceed with the cancellation after the
notice period expires.
Summary:
Section 10 of the Trade Unions Act empowers the Registrar to withdraw or cancel the
registration of a trade union based on the union’s request, fraud, the union ceasing to
exist, violations of the Act, or non-compliance with mandatory rules.
In cases where the cancellation is initiated by the Registrar (not by the union), a two-
month written notice is mandatory, giving the trade union a chance to remedy the
situation or provide justification before the final decision is made.
Section 11: Appeal
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22. This section of the Trade Unions Act, 1926 provides the right to appeal against decisions
made by the Registrar of Trade Unions concerning the registration or cancellation of a trade
union’s certificate. Here’s a detailed explanation:
(1) Right to Appeal:
If a person (generally a member or representative of a trade union) is aggrieved by
the Registrar’s decision in either of these two cases:
1.Refusal to register a trade union.
2.Withdrawal or cancellation of a trade union’s certificate of registration.
That person has the right to appeal against the Registrar’s decision within a
prescribed period (the time frame for filing an appeal is specified by law).
Two Types of Appeals Based on Location:
The appeal will depend on where the head office of the trade union is located:
(a) Appeal to the High Court:
oIf the trade union’s head office is located within a Presidency-town, the
appeal is made directly to the High Court. (In India, Presidency-towns refer
to places like Kolkata, Mumbai, and Chennai).
(b) Appeal to a Lower Court:
oIf the trade union’s head office is located outside the Presidency-towns, the
appeal is made to a Court of an Additional or Assistant Judge of a
Principal Civil Court of original jurisdiction.
oThe appropriate government (Central or State Government) appoints which
Court will handle such appeals in a particular area.
(2) Powers of the Appellate Court:
The Appellate Court (whether it is the High Court or a lower court) has the
following powers:
1.Dismiss the Appeal:
If the Court finds that the Registrar’s decision was justified, it can
dismiss the appeal, meaning the Registrar’s decision stands.
2.Direct the Registrar to Register the Union:
If the Court finds that the Registrar wrongfully refused the registration,
it can order the Registrar to register the union and issue a certificate
under Section 9 (which details the process of issuing certificates of
registration).
3.Set Aside the Cancellation/Withdrawal:
If the Court finds that the cancellation or withdrawal of the certificate
was improper, it can set aside (reverse) the Registrar’s order.
Once the Court issues an order, the Registrar is required to comply with the order,
whether it involves issuing a certificate or reversing a cancellation.
(3) Procedure of the Appeal:
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23. The Appellate Court will follow the same procedure that it would follow when
handling a civil suit under the Code of Civil Procedure, 1908.
This includes:
oThe powers to summon witnesses, examine evidence, and conduct hearings.
oThe power to decide who will bear the costs of the appeal. The Court may
direct that the costs of the appeal be paid by either party (the person filing the
appeal or the Registrar).
oThe costs will be recovered as if they were awarded in a civil suit under the
Code of Civil Procedure.
(4) Further Right of Appeal:
If an appeal is dismissed by a lower Court (a Court appointed under Clause (b) of
Sub-section 1), the aggrieved person can still appeal to the High Court.
In this case, the High Court will have the same powers as an appellate court and will
follow the same procedures as mentioned in Sub-sections (2) and (3).
Section 12: Registered Office
Every registered trade union must have a registered office where all
communications and notices can be sent.
If the address of the head office changes, the trade union is required to inform the
Registrar of the new address within fourteen days of the change.
The new address must be recorded in the register maintained under Section 8 (which
deals with the Registrar’s record of registered trade unions).
Section 13: Incorporation of Registered Trade Unions
Once a trade union is registered, it becomes a legal entity or a corporate body.
As a corporate body:
oThe trade union has perpetual succession (it continues to exist even if its
members change).
oIt has a common seal (used for formalizing contracts).
oIt can acquire and hold property (both movable and immovable property).
oIt can enter into contracts and can sue or be sued in its own name.
Section 14: Certain Acts Not to Apply to Registered Trade Unions
This section specifies that certain laws that apply to other organizations or entities will not
apply to registered trade unions. These include:
1.Societies Registration Act, 1860:
oTrade unions will not be treated as societies under this law, which generally
governs the registration and functioning of societies.
2.Co-operative Societies Act, 1912:
oTrade unions will not be treated as cooperative societies.
3.Companies Act, 1956 (now replaced by the Companies Act, 2013):
oTrade unions will not be governed by the Companies Act, which applies to
companies and corporations.
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24. If any trade union is registered under these acts, its registration is considered void. In
other words, a trade union cannot be registered under any of these Acts; it can only be
registered under the Trade Unions Act, 1926.
Summary:
Section 11 gives trade unions or their representatives the right to appeal decisions
made by the Registrar, with different courts handling appeals based on the union’s
location. The Appellate Court can either uphold or reverse the Registrar’s decisions.
Sections 12 to 14 establish the legal status of registered trade unions, including their
rights to hold property, enter into contracts, and be treated as a legal entity. Registered
trade unions are excluded from certain laws, such as the Societies Registration Act
and the Companies Act.
Chapter III of the Trade Unions Act, 1926 outlines the rights and liabilities of registered
trade unions, specifically addressing how the general funds of a trade union can be used.
Section 15 specifies the permissible expenditures from these funds. Below is a detailed
explanation of each sub-clause, along with examples.
Section 15: Objects on Which General Funds May Be Spent (Objects on Which General
Funds May Be Spent (Sec�on 15)
The funds of a registered trade union can only be used for specific purposes:
1. Salaries and Expenses: Paying salaries and expenses of office-bearers.
2. Administrative Costs: Expenses related to managing the union, including audits.
3. Legal Proceedings: Costs for legal actions to protect the rights of the union or its
members.
4. Trade Disputes: Conducting disputes on behalf of member
5. Compensation: Providing financial support to members affected by trade
disputes.
6. Allowances: Offering support to members or their dependents in cases of death,
sickness, or unemployment.
7. Insurance Policies: Paying for life or health insurance for members.
8. Educational and Social Benefits: Providing benefits for members and their
families, including funeral expenses.
9. Publications: Maintaining publications discussing issues affecting workers.
10. Contributions to Worker Causes: Donating to causes that benefit workers,
limited to one-fourth of the total income.)
The general funds of a registered trade union can be utilized for the following purposes:
(a) Payment of Salaries, Allowances, and Expenses to Office-Bearers
Explanation: This refers to the financial compensation for those holding official
positions within the trade union, such as the president, secretary, and treasurer.
Example: A trade union might pay its president an annual salary of 50,000, along ₹
with allowances for travel expenses incurred while attending union meetings.
(b) Payment of Administrative Expenses
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25. Explanation: This covers the costs associated with running the trade union, including
office supplies, rent for office space, and auditing of accounts.
Example: If a trade union incurs expenses for office rent amounting to 10,000 and ₹
pays 5,000 for an annual audit, these costs can be covered from the general funds.₹
(c) Prosecution or Defence in Legal Proceedings
Explanation: Funds can be used to cover legal costs when the union or its members
are involved in legal disputes, aiming to protect their rights.
Example: If a member files a lawsuit against an employer for unfair dismissal, the
trade union can use its funds to hire a lawyer to represent the member.
(d) Conduct of Trade Disputes
Explanation: This allows trade unions to spend funds on activities related to
resolving disputes between workers and employers.
Example: A trade union may organize a strike to negotiate better wages and use funds
to support the strike’s logistics, such as banners and food for striking members.
(e) Compensation for Losses from Trade Disputes
Explanation: This clause allows unions to provide financial support to members who
suffer losses due to trade disputes, such as during a strike.
Example: If a member loses wages during a strike, the trade union may provide them
with a compensation amount of 1,000 to help them during that period.₹
(f) Allowances to Members or Dependants
Explanation: This refers to financial assistance given to members or their dependants
during times of need, such as illness, accidents, or unemployment.
Example: A trade union could provide 5,000 to a member who is temporarily ₹
disabled due to a workplace accident, helping them cover basic living expenses.
(g) Insurance Policies for Members
Explanation: Trade unions can undertake insurance policies to safeguard the
financial interests of their members against events like illness, accidents, or
unemployment.
Example: A trade union may purchase a group life insurance policy that provides 1 ₹
lakh to the beneficiaries of members who pass away while being part of the union.
(h) Educational, Social, or Religious Benefits
Explanation: Funds can be allocated to provide educational and social benefits,
including funeral expenses for deceased members.
Example: If a union member passes away, the union might spend 10,000 to cover ₹
funeral costs, ensuring the family is not burdened financially.
(i) Upkeep of a Periodical
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26. Explanation: Funds can be spent on maintaining a publication that discusses issues
relevant to employers and workers.
Example: A trade union could publish a monthly newsletter costing 2,000 to inform₹
members about industry news and union activities.
(j) Contributions to Causes Benefiting Workmen
Explanation: Unions can contribute to external causes that aim to benefit workers,
but this expenditure cannot exceed one-fourth of the combined total of their income
and funds at the start of the year.
Example: If a trade union has 100,000 in gross income for the year and 20,000 in ₹ ₹
existing funds, they can contribute up to 30,000 (one-fourth of 120,000) to support ₹ ₹
a workers’ welfare initiative.
(k) Other Objects Notified by the Appropriate Government
Explanation: This clause allows the government to notify additional permissible
expenditures for trade unions.
Example: If the government issues a notification allowing trade unions to fund
vocational training programs, the union can allocate funds accordingly to help its
members enhance their skills.
Summary
Section 15 of the Trade Unions Act, 1926, establishes clear guidelines on how the general
funds of registered trade unions can be used. The provisions ensure that the funds are spent
on activities that directly benefit the members and support the union’s objectives. This
structured approach helps maintain accountability and transparency within trade unions,
ensuring that members' contributions are utilized effectively for their welfare and rights
Overview of Section 16
This section allows trade unions to create a separate fund specifically for political activities.
The money in this fund comes from contributions that members choose to give, and it can be
used to support the political interests of the members. Here’s a simplified breakdown of each
part.( Cons�tu�on of a Separate Fund for Poli�cal Purposes (Sec�on 16)
Overview: Trade unions can create a separate fund for political activities.
Objects for Political Fund Use:
1.Election Expenses: Supporting candidates in elections, including payment of
expenses related to their campaigns.
2.Meetings and Literature: Organizing meetings and distributing materials supporting
candidates.
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27. 3.Support for Legislative Members: Financial support for current members of
legislative bodies.
4.Electoral Activities: Registration of voters and candidate selection.
5.Political Meetings: Holding and promoting political meetings or distributing related
materials.
8. Contribution to Political Fund is Not Compulsory (Section 16(3))
Overview: Members are not forced to contribute to the political fund.
Rights of Non-Contributors: Members who choose not to contribute cannot be
excluded from union benefits or face disadvantages. They also cannot be forced to
pay as a condition for joining the union.
Example: If a member chooses not to contribute to the political fund, they can still
participate in union activities and enjoy the benefits of membership without any
penalty.)
Key Points Explained
(1) Creating a Separate Fund
What it means: A trade union can set up a fund specifically for political purposes,
and this fund must be financed by extra contributions from its members.
Example: A union might ask members to contribute an additional 50 each month for₹
political activities. This money is used only for those activities.
(2) How the Fund Can Be Used
The fund can be used for several specific purposes:
(a) Supporting Election Candidates
What it means: The fund can pay for expenses related to any candidate running for
political office (like local councils or state legislatures).
Example: If a union member is running for a city council position, the fund can help
pay for their campaign materials, such as posters and flyers.
(b) Organizing Supportive Activities
What it means: The union can hold meetings or distribute materials to help a
candidate.
Example: The union might organize a meeting to discuss why members should
support a certain candidate and use the fund to print pamphlets for that meeting.
(c) Financial Support for Elected Members
What it means: If a member gets elected to a legislative body (like a state assembly),
the fund can help cover their expenses.
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28. Example: The fund could help pay for the elected member's office supplies or staff
salaries.
(d) Assisting with Voter Registration
What it means: The fund can help register voters or choose candidates for elections.
Example: The union might run a campaign to encourage members to register to vote,
using the fund for advertising and events.
(e) Political Meetings and Literature
What it means: The fund can be used for political gatherings and for sharing political
information.
Example: The union may host a political discussion forum and use money from the
fund to cover the venue and refreshments.
(2A) Special Clause for Jammu and Kashmir
What it means: In Jammu and Kashmir, the rules apply to their specific legislative
bodies as well.
Example: If a union in Jammu and Kashmir supports a candidate for their local
assembly, they can use this fund for related expenses.
(3) Member Contributions are Optional
What it means: Members cannot be forced to contribute to this political fund, and
those who don’t contribute still receive all other benefits from the union.
Example: If a member chooses not to donate to the political fund, they still get
benefits like health coverage or assistance during strikes. They just won’t have a say
in how the political fund is spent.
Summary
In simple terms, Section 16 allows trade unions to create a special fund to support political
activities, but contributions to this fund are completely voluntary. Members who don’t want
to contribute won’t be penalized in any way. This ensures that the political interests of
members can be supported while also protecting individual rights within the union.
The immunities and privileges of registered trade unions under the Trade Unions Act,
1926 protect them from certain legal actions. These immunities allow trade unions to carry
out activities like strikes without being held liable for criminal conspiracy or civil actions
under specific conditions. Here's a simpler breakdown:
1. Immunity from Criminal Conspiracy (Section 17)
This section protects office-bearers and members of registered trade unions from being
punished for criminal conspiracy during legitimate trade union activities. However, there are
four conditions:
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29. Protection is only for registered trade unions.
The immunity applies only if the agreement or action is for lawful trade union
objectives.
The immunity does not apply if the agreement is to commit a crime.
The activities must align with the objectives specified in Section 15 of the Act (which
lists valid trade union purposes, like improving working conditions).
Criminal conspiracy under the law means an agreement between two or more people to
commit an offense. Normally, things like breaking an employment contract could count as
criminal conspiracy. But under this section, when trade unions take actions such as calling for
strikes, which may involve breaches of employment contracts, they are not considered
criminal conspiracies if done as part of a trade dispute.
Example:
If a trade union organizes a strike where workers refuse to work (breach of contract), the
members or leaders cannot be punished for conspiracy, as long as the strike isn’t about
committing a crime.
2. Immunity from Civil Actions (Section 18)
This section protects registered trade unions from being sued in civil court for certain
actions taken during trade disputes. There are two main points:
1.No civil suit can be filed against a registered trade union for actions taken to further a
trade dispute, even if these actions cause others to break employment contracts or
interfere with business.
2. The trade union cannot be held liable for tortious acts (wrongs or harm) committed
by its agents during trade disputes, unless the union leadership knew about it or
directly instructed the agent.
Example:
If a union organizes a peaceful strike, and as a result, some workers break their employment
contracts, the employer cannot sue the union for damages. However, if the union engages in
unlawful activities (like violence or trespassing), the immunity does not apply.
Limits of the Immunity:
Illegal activities: If union members commit crimes like violence or property damage
during a strike, they lose the immunity.
Offenses: If members agree to commit a crime (e.g., sabotage or violence), immunity
does not protect them.
3. Enforceability of Agreements
Section 19 grants protection to union agreements that might otherwise be considered
restraint of trade under common law. These agreements, though they may restrict trade, are
enforceable as long as they are made for lawful union activities.
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30. Problems Faced by Trade Unions in India
The trade union movement in India faces several challenges:
1.Multiplicity of Unions: Multiple unions exist within a single industry or workplace,
leading to fragmentation and reduced bargaining power.
2.Absence of Union Structure: There's a lack of consistent union structures like craft
or industrial unions, which weakens collective representation.
3.Limited Membership: Most unions have a small membership base, which weakens
their influence.
4.Scarcity of Finances: Unions often have very low financial resources, limiting their
capacity to organize welfare programs for workers.
5.Small Size: Many unions are small, and a majority of them have fewer than 500
members.
6.Lack of Unity: Unions are often politically divided, which hampers their ability to
present a united front.
7.Lack of Trained Workers: Many union members are uneducated or untrained,
leaving them vulnerable to manipulation by political leaders.
8.Political Dominance: Trade unions are often controlled by political parties, which
can shift focus away from workers' welfare to political gains.
9.Hostile Attitude of Employers: Employers often resist union activities and may use
intimidation tactics to weaken union leadership.
Conclusion
The Trade Unions Act, 1926, provides crucial legal protections to trade unions, safeguarding
them from civil and criminal liabilities in the context of lawful strikes and industrial disputes.
However, these immunities come with limitations and do not cover illegal acts such as
violence or property damage. The challenges faced by trade unions, including fragmentation
and political interference, often hinder their effectiveness in securing workers’ rights.
Section 21A – Disqualifications of Office-Bearers of Trade Unions
This section lays down conditions under which a person cannot be chosen as an office-
bearer (such as president, secretary, or member of the executive) of a registered trade union.
1. Disqualification Based on Age (Subsection 1, Clause i)
Explanation: A person must be at least 18 years old to be an office-bearer of a
registered trade union.
Reason: This ensures that only adults who are considered legally responsible are
involved in the leadership of the union.
Example: A 17-year-old member of a trade union cannot be elected as the president or
secretary, but once they turn 18, they are eligible.
2. Disqualification Due to Conviction (Subsection 1, Clause ii)
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31. Explanation: If a person has been convicted of an offense involving moral
turpitude and sentenced to imprisonment, they are disqualified from being an
office-bearer unless five years have passed since their release from prison.
"Moral turpitude" refers to crimes that are considered dishonorable or unethical,
like theft, fraud, or corruption.
Example: If a trade union member was convicted of embezzling funds and sentenced to
prison, they cannot be an office-bearer until five years after their release.
3. Special Rule for Pre-1964 Convictions (Subsection 2)
Explanation: Any member who was convicted of an offense involving moral
turpitude before the 1964 amendment to the Act and was serving as an office-bearer
at that time will cease to hold office unless five years have passed since their release
from prison.
Example: If someone was convicted and imprisoned in 1962 and was still an office-bearer in
1964, they would have to step down unless five years had already passed since their release.
4. Jammu and Kashmir Application (Subsection 3)
Explanation: In the State of Jammu and Kashmir, the reference to the
"commencement of the Indian Trade Unions (Amendment) Act, 1964" means the date
when this Act started applying to Jammu and Kashmir.
Note: This subsection is specific to the state's legal context and ensures that the law's timing
aligns with Jammu and Kashmir’s legal framework.
Key Takeaways:
Minimum age to be an office-bearer: 18 years.
Conviction for a crime involving moral turpitude leads to disqualification unless
five years have passed since release.
Special rules apply for convictions before 1964.
The sections you provided from the Trade Unions Act, 1926 cover a variety of important
provisions related to the functioning and regulation of trade unions in India. Here's a detailed
explanation of each clause:
20. Right to Inspect Books of Trade Union
Explanation: This section grants the office-bearers (such as the President, Secretary,
etc.) and members of a registered trade union the right to inspect the union's account
books and the list of its members.
Condition: This inspection can be done at times as specified in the rules of the trade
union. Each trade union usually has its own rules regarding when and how
inspections can take place.
Example: If a member of a trade union suspects financial mismanagement, they can request
to inspect the account books, provided it aligns with the union's rules.
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32. 21. Rights of Minors to Membership of Trade Unions
Explanation: Any person who is 15 years or older can become a member of a
registered trade union, subject to the union’s rules.
Rights: Once a minor (aged 15 or above) becomes a member, they enjoy all rights of
a member, such as voting in union decisions, and they can sign or execute necessary
documents on behalf of the union.
Example: A 16-year-old worker in a factory can join the trade union representing that factory
and enjoy the same rights as an adult member.
21A. Disqualifications of Office-Bearers of Trade Unions
This section lists the conditions under which a person is disqualified from being an office-
bearer of a trade union.
1.Age Restriction (Subsection 1):
oA person must be at least 18 years old to be an office-bearer or a member of
the executive committee of a registered trade union.
2.Conviction for Offense (Subsection 1):
oIf a person has been convicted of an offense involving moral turpitude
(which generally refers to crimes that violate moral standards, such as theft,
fraud, or corruption) and sentenced to imprisonment, they are disqualified
from being an office-bearer. However, this disqualification only lasts until five
years have passed since their release from prison.
3.Pre-1964 Convictions (Subsection 2):
oIf any office-bearer was convicted of such an offense before the 1964
Amendment, they will also cease to hold office unless five years have elapsed
since their release from prison before the commencement of the amendment.
4.Jammu and Kashmir (Subsection 3):
oThe provisions regarding disqualifications apply to the State of Jammu and
Kashmir with reference to the commencement of the Trade Unions
(Amendment) Act in that state.
Example: If a trade union leader is convicted of fraud and sent to prison, they cannot hold
office in the union for five years after their release.
22. Proportion of Office-Bearers to Be Connected with the Industry
Explanation: At least half of the office-bearers (such as the President, Secretary,
etc.) of every registered trade union must be engaged or employed in the industry
with which the trade union is connected.
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33. Exception: The appropriate government (either state or central, depending on the
jurisdiction of the union) may issue an order exempting certain unions from this rule.
Example: If a trade union represents textile workers, at least half of the office-bearers must
be working in the textile industry.
23. Change of Name
Explanation: A registered trade union may change its name if two-thirds of its total
members consent to the change, and the change complies with the provisions of
Section 25 (which concerns notifying the Registrar).
Example: If a trade union wants to change its name from "Steel Workers Union" to "Iron and
Steel Workers Union," it requires two-thirds of its members to approve the change and must
inform the Registrar.
24. Amalgamation of Trade Unions
Explanation: Two or more registered trade unions can amalgamate into a single trade
union. For the amalgamation to be valid:
oAt least 50% of the members of each trade union must participate in a vote.
oAt least 60% of the members who vote must be in favor of the proposal.
Example: If Trade Union A has 100 members and Trade Union B has 150 members, at least
50 members of Union A and 75 members of Union B must vote. If 60% of the votes cast are
in favor, the amalgamation can proceed.
25. Notice of Change of Name or Amalgamation
This section details the process for officially notifying authorities when a trade union changes
its name or amalgamates.
1.Notice of Change of Name/Amalgamation (Subsection 1):
oA written notice signed by the Secretary and seven members of the union (or
each union, in the case of amalgamation) must be sent to the Registrar of
Trade Unions. If the new/amalgamated union’s head office is in another state,
the notice must also go to the Registrar of that state.
2.Registrar’s Decision on Name (Subsection 2):
oIf the new name is identical to an existing trade union or too similar, the
Registrar can refuse to register the name to prevent confusion.
3.Registration of Name Change (Subsection 3):
oIf the Registrar is satisfied that the rules have been followed, they will register
the change of name, and it becomes effective from the registration date.
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34. 4.Registration of Amalgamation (Subsection 4):
oIf the Registrar is satisfied that the amalgamation complies with the law, they
will register the new/amalgamated union, which will take effect from the date
of registration.
26. Effects of Change of Name and Amalgamation
Effect of Name Change (Subsection 1):
oChanging the name of a trade union does not affect its legal rights or
obligations. Any legal proceedings can continue or be initiated under the new
name.
Effect of Amalgamation (Subsection 2):
oThe amalgamation of two or more unions will not affect any of the rights or
liabilities of the individual unions or their creditors.
Example: After the name change or amalgamation, any legal dispute that existed before the
change can continue under the new name or amalgamated entity.
27. Dissolution
Explanation: If a registered trade union is dissolved, the union must notify the
Registrar within 14 days of the dissolution. The notice must be signed by the
Secretary and seven members of the union. The Registrar will only register the
dissolution if satisfied that it complies with the union’s rules.
Distribution of Funds: If the union’s rules do not specify how to distribute its funds
upon dissolution, the Registrar will divide the funds among the members.
Example: When a trade union disbands, its remaining funds will be distributed to its
members, unless the union’s rules say otherwise.
28. Returns
1.Annual Returns (Subsection 1):
oEvery registered trade union must send an annual statement to the Registrar,
detailing the union’s receipts, expenditures, and its assets and liabilities.
This statement must be audited and submitted by a prescribed date.
2.Changes of Office-Bearers (Subsection 2):
oThe union must also send the Registrar a statement of any changes in office-
bearers and an updated copy of its rules.
3.Alterations of Rules (Subsection 3):
oAny changes to the union’s rules must be sent to the Registrar within 15 days
of the alteration.
4.Inspection by Registrar (Subsection 4):
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35. oThe Registrar (or an authorized officer) can inspect the union’s registration
certificate, account books, and other documents at the union’s office or at a
location within ten miles of the office.
Example: Each year, the union must submit its financial records and any changes in
leadership to the Registrar.
Chapter IV - Regulations
This chapter (Sections 29 and 30) provides the government with the power to make
regulations to implement the provisions of the Trade Unions Act. It also describes how these
regulations are to be made and published.
Section 29 – Power to Make Regulations
Subsection (1) – General Power to Make Regulations
Explanation: The appropriate government (which could be the Central or State
Government depending on jurisdiction) has the authority to make regulations to carry
out the objectives of the Trade Unions Act.
Purpose: This allows the government to create specific rules and processes needed to
implement the Act effectively.
Example: If certain procedures need to be clarified for registering trade unions or handling
their financial matters, the government can introduce new regulations for these purposes.
Subsection (2) – Specific Areas for Regulation
This subsection lists some particular areas where the government may issue regulations.
These regulations are framed without limiting the general power provided in Subsection (1).
Clause (a) – Registration of Trade Unions
Explanation: Regulations can be made about how trade unions are registered,
including the process and the fees payable.
Purpose: This ensures that there is a clear, standardized process for registering trade
unions.
Example: The government may set rules about the documents needed for registration and the
fees trade unions must pay when they apply for registration.
Clause (b) – Transfer of Registration
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36. Explanation: Regulations can govern how a registered trade union can transfer its
registration if it moves its head office from one state to another.
Purpose: This allows trade unions to smoothly continue their operations even if they
change location across state lines.
Example: If a trade union headquartered in Kerala moves to Tamil Nadu, the government
can create rules for how the trade union’s registration is transferred between the states.
Clause (c) – Audit of Accounts
Explanation: Regulations can set out who is qualified to audit the accounts of
registered trade unions and how the audits should be conducted.
Purpose: This ensures that the financial operations of trade unions are transparent and
managed by qualified auditors.
Example: The government might specify that only certified accountants can audit trade
union accounts and establish the audit process.
Clause (d) – Inspection of Documents
Explanation: Regulations can outline the conditions under which people can inspect
the documents kept by Registrars, and the fees for such inspections.
Purpose: To ensure that there is a clear and controlled process for inspecting the
records of trade unions, and that it is done fairly and transparently.
Example: If a member of the public wants to inspect the registration records of a trade union,
the government can define how this can be done and the fees payable for this inspection.
Clause (e) – Other Prescribed Matters
Explanation: Regulations can be made regarding any other matters that the Act
mentions as needing regulation.
Purpose: This is a broad clause that covers any additional issues that the Act leaves
to the government’s discretion to regulate.
Example: If the Act later introduces a new area that requires regulation, the government can
make regulations under this clause.
Section 30 – Publication of Regulations
Subsection (1) – Condition of Previous Publication
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37. Explanation: Regulations made under Section 29 must be published before they are
finalized, giving the public a chance to view them.
Purpose: This ensures transparency and public participation in the regulation-making
process.
Example: If the government drafts regulations about trade union audits, they must publish
the draft to allow people to comment on it before the regulations are finalized.
Subsection (2) – Minimum Time for Consideration of Draft Regulations
Explanation: The draft of any proposed regulation must be published at least three
months before it is considered for final approval.
Purpose: This ensures that there is sufficient time for public or stakeholder input on
the proposed regulations.
Example: If the government publishes a draft regulation on trade union registration on
January 1st, it cannot finalize the regulation before April 1st, giving a full three months for
comments or suggestions.
Subsection (3) – Publication and Effect of Regulations
Explanation: Once the regulations are finalized, they must be published in the
Official Gazette. After publication, the regulations will have the same effect as if
they were part of the Trade Unions Act itself.
Purpose: This gives the regulations official status and legal effect.
Example: If the regulation about audit requirements is published in the Official Gazette, it
becomes enforceable, and all trade unions must comply with it as if it were a part of the Act
itself.
Summary:
1.Section 29(1): The government has the authority to create regulations for
implementing the Trade Unions Act.
2.Section 29(2): Regulations can address specific areas like registration, transfer of
registration, audits, document inspection, and other related matters.
3.Section 30(1): Regulations must be published for public review before they are
finalized.
4.Section 30(2): There must be a minimum three-month period between the publication
of draft regulations and their consideration.
5.Section 30(3): Once published in the Official Gazette, the regulations have the force
of law.
Chapter V - Penalties and Procedure
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38. This chapter outlines the penalties for violations of the Trade Unions Act and the procedures
to be followed in such cases. It covers issues such as failure to submit required documents,
supplying false information, and the legal process for addressing such offenses.
Section 31 – Failure to Submit Returns
This section addresses the penalties for failing to submit the required notices, statements, or
documents under the Act. It has two parts:
Subsection (1) – General Failure to Submit Documents
Explanation: If a registered trade union fails to give any notice or send any statement
or document that is required under the Act, certain individuals will be penalized.
These individuals include:
oOffice-bearers (people in key positions within the union, like the president or
secretary).
oOther persons bound by the union's rules to submit these documents.
oIf no such specific person exists, every member of the trade union's executive
committee will be responsible.
Penalty: A fine that can extend up to 5 for each instance of default, and in case of ₹
continuing default (failing to correct the issue), an additional fine of up to 5 per week. ₹
However, the total fine cannot exceed 50.₹
Example: If a trade union fails to submit its annual financial statement required by law, the
responsible office-bearers can be fined 5 initially, and an additional 5 per week for ₹ ₹
continued default, with a maximum penalty of 50.₹
Subsection (2) – False Entries or Omissions
Explanation: This clause penalizes individuals who intentionally make false entries
or omissions in the general statement required under Section 28 (which covers annual
financial statements), or in the copy of the trade union rules or any alterations to those
rules sent to the Registrar.
Penalty: A fine that may extend up to 500 for making or causing to make such false ₹
statements or omissions.
Example: If a trade union falsely declares its financials in the annual statement to avoid
transparency, the person responsible may be fined 500.₹
Section 32 – Supplying False Information Regarding Trade Unions
Explanation: This section deals with individuals who, with the intent to deceive:
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39. oProvide any member of a registered trade union or someone intending to join
the union with a document that falsely claims to be a copy of the rules of the
union or any alteration to the rules.
oProvide a copy of any rules of an unregistered trade union to someone, falsely
claiming that the union is registered.
Penalty: A fine that can extend up to 200.₹
Example: If someone gives a potential trade union member a fake copy of the union's rules
that claim certain benefits that do not exist, or if someone presents an unregistered union as a
registered one, the person responsible can be fined up to 200.₹
Section 33 – Cognizance of Offences
This section outlines the procedure for taking legal action for offenses under this Act.
Subsection (1) – Jurisdiction of Courts
Explanation: Only certain higher courts can try offenses under the Trade Unions Act.
Specifically, no court lower than:
oA Presidency Magistrate (in metropolitan cities).
oA Magistrate of the First Class (in other areas).
This means that minor courts cannot handle cases under this Act, and only courts with
specific authority can do so.
Example: A Magistrate of the Second Class would not be allowed to hear a case involving
failure to submit returns under this Act; it would go to a First Class Magistrate instead.
Subsection (2) – Conditions for Taking Legal Action
Explanation: A court can only take up a case under this Act if:
oA complaint is made by or with the previous sanction of the Registrar of
Trade Unions.
oIn the case of an offense under Section 32 (supplying false information), the
complaint can also be made by the person who was given the false document.
Additionally, the complaint must be made within six months of the date on which the offense
is alleged to have occurred.
Example: If a member of a trade union received a fake set of rules claiming benefits that
don’t exist and wishes to file a complaint, they must do so within six months of receiving the
false document. Alternatively, the Registrar of Trade Unions can also file the complaint.
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40. Summary:
1.Section 31: Failure to submit required documents or submitting false documents can
lead to fines. The fine increases with continued default but is capped at 50 for ₹
regular defaults and 500 for willfully false entries.₹
2.Section 32: Giving false information to deceive someone about a trade union’s status
or rules can result in a fine up to 200.₹
3.Section 33: Only specific higher-level courts can hear cases under this Act, and legal
action must be initiated by either the Registrar or the person deceived, within six
months of the offense.
This ensures accountability and provides mechanisms for addressing non-compliance by
trade unions or individuals involved in their administration
The procedure for a registered Trade Union to change its name under the Trade Unions Act,
1926 is as follows:
1. Approval by Members (Section 23)
The Trade Union must obtain the consent of at least two-thirds of its total members
before proceeding with a name change.
This means a formal vote or decision-making process must be carried out where two-
thirds of the members agree to the change.
2. Compliance with Section 25
Section 25 lays out the specific steps to follow once the members approve the name
change.
3. Notice to the Registrar (Section 25(1))
A written notice of the name change must be sent to the Registrar of Trade Unions.
The notice should be:
oSigned by the Secretary of the Trade Union.
oSigned by at least seven members of the Trade Union.
4. Verification of Name (Section 25(2))
The Registrar will review the proposed name to ensure it is:
oNot identical to the name of an existing registered Trade Union.
oNot so similar to another Trade Union’s name that it could deceive the public
or members.
If the Registrar finds the name to be too similar to another existing name, they can
refuse to register the change.
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41. 5. Registration of the Change (Section 25(3))
If the Registrar is satisfied that all legal requirements have been followed (including
getting the necessary consent from members), they will:
oRegister the change of name in the register of Trade Unions (as per Section 8
of the Act).
oThe name change becomes effective from the date of registration.
6. Effects of the Name Change (Section 26(1))
The change in the name does not affect the rights or obligations of the Trade Union.
Any legal proceedings against or by the Trade Union under its old name can still
continue, but under the new name.
Summary of the Procedure:
1.Get approval from two-thirds of the total members.
2.Send a written notice to the Registrar, signed by the Secretary and seven members.
3. The Registrar checks if the new name is acceptable (i.e., not identical or confusingly
similar to another union’s name).
4. If everything is in order, the Registrar registers the new name.
5. The name change is effective from the date of registration, without affecting the
union’s rights or obligations.
Example:
A union called "Textile Workers Union" wants to change its name to "Fabric Industry
Workers Union." The union holds a vote, and two-thirds of the members agree. The
Secretary, along with seven members, signs a notice and submits it to the Registrar. After
ensuring that no other union has a similar name, the Registrar approves the change, and from
the registration date, the union officially operates under its new name.
Section 26: Effects of Change of Name and Amalgamation
A name change does not affect the Trade Union’s rights or obligations, and legal
proceedings can continue under the new name.
Amalgamation does not affect the rights of any of the merged Trade Unions or their
creditors.
Section 27: Dissolution
When a Trade Union is dissolved, a notice signed by the Secretary and seven
members must be sent to the Registrar within 14 days.
If the union’s rules do not specify how to distribute funds after dissolution, the
Registrar will decide on fund distribution.
Section 28: Returns
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42. Every year, a Trade Union must submit a general statement to the Registrar
showing:
oAll receipts, expenditures, assets, and liabilities of the union as of December
31.
oAny changes in office-bearers during the year.
oA copy of the updated rules of the Trade Union.
The Registrar has the authority to inspect the union’s records for accuracy.
This summary captures the key requirements and processes related to Trade Unions under the
Act. Each section ensures that changes in the union’s status, whether through a name change,
merger, or dissolution, are legally recorded and managed transparently.
Section 29: Power to Make Regulations
This section gives the government the power to make rules (regulations) to help implement
the Trade Unions Act. These rules can cover specific things like:
1.How Trade Unions register: The government can decide what documents are needed
and how much the registration fee will be.
Example: The government could say that to register, a Trade Union must fill out a
specific form and pay 500.₹
2.Transfer of registration: If a Trade Union moves its head office to another state, the
government will decide how to transfer its registration to the new state.
Example: If a Trade Union moves from Kerala to Tamil Nadu, the government will
have rules on how to transfer its registration to Tamil Nadu.
3.Auditing the Trade Union’s accounts: The government will decide who can check
(audit) the Trade Union's accounts and how this should be done.
Example: The government could require a certified accountant to audit the Union's
financial records.
4.Inspecting documents: The government will decide when people can see the
documents kept by the Registrar and how much it will cost.
Example: If someone wants to see a Trade Union’s registration documents, the
government will decide if it’s allowed and the fee for the inspection.
5.Other rules: The government can also make rules about anything else the Act allows.
Section 30: Publication of Regulations
This section ensures that before the government finalizes any rules (regulations), it must:
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43. 1.Publish a draft of the rules for the public to see.
Example: If the government wants to change the registration process for Trade
Unions, it must first publish a draft of the new rules for everyone to review.
2.Allow time for feedback: The public must have at least 3 months to give feedback on
the proposed rules.
Example: If the draft rules are published on January 1, the public must be able to
submit their comments until at least April 1.
3.Make the rules official: Once the rules are finalized, they will be published in the
government’s Official Gazette, and they will have the force of law.
Example: After the rules about registration fees are finalized and published, Trade
Unions must follow these new rules as if they were part of the law.
In summary:
Section 29 gives the government power to make rules for the smooth functioning of
Trade Unions, covering things like registration, audits, and transferring offices.
Section 30 ensures that the public has a say in these rules by allowing feedback for at
least 3 months before the rules become official and are published as law
Section 31: Failure to Submit Returns
1.If a Trade Union doesn't send required documents (like reports or statements),
what happens?
oThe leaders (office-bearers) or members of the executive (if no specific
person is responsible) can be fined.
2.What is the fine?
o5 for not submitting the document on time.₹
oIf the delay continues, 5 more for each week they keep delaying.₹
oBut the total fine can't be more than 50.₹
3.If someone deliberately makes false entries (like fake financial data), what
happens?
oThey can be fined up to 500.₹
Section 32: Supplying False Information
1.If someone intentionally gives false information (like fake rules or altered rules)
to a member or someone who wants to join the Union, what happens?
oThey can be fined up to 200.₹
2.Example: If someone gives a member a fake version of the Union’s rules pretending
it’s the real one, they can be fined.
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44. Section 33: Cognizance of Offences
1.Who can hear these cases?
oOnly higher-level courts, like a Presidency Magistrate or a Magistrate of
the first class, can handle cases related to Trade Union offences.
2.How do cases get started?
oA complaint must be filed by the Registrar of Trade Unions or approved by
them.
oFor false information (from Section 32), the person who got the false
information can also file the complaint.
3.Time limit: The complaint has to be filed within six months from when the offence
happened.
Quick Summary:
If a Trade Union doesn’t submit documents, fines are 5 per week (up to 50).₹ ₹
Giving fake documents or rules leads to fines up to 200.₹
Only higher courts handle these cases, and complaints must be filed within six months
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