Standing Order is the model code of conduct of an organization applicable only to those organizations employing more than 300 or more employees presently or had employed in the preceding 12 months as elucidated under Section (§) 28 of the Industrial Relations Code 2020 (IRC/the Code). Initially, it was dealt with by the Standing Orders Act (the Act) of 1946 but after the consolidation of labour laws into the Labour Codes of 2020, the provision relating to Standing Orders is dealt with in by Chapter 4 of IRC 2020. Standing Orders, as per Section (§) 2 (zj) of the Code, are the “orders relating to the matters set out in the First Schedule of the Code 2020.” Schedule 1 jots down 11 matters regulating employees’ behaviour and preventing employers from getting arbitrary.
Under §29 of IRC, a model standing order is released by the incumbent administration in accordance with which the employer has to formulate a draft standing order in consultation with the labour union or any other labour representation. Within 6 months of such release, the draft is then presented before the Certifying Officer (CO) appointed under §2(g) of IRC, who after scrutiny of the same either approves the orders or reverts it for certain modifications. After making the said modifications, these draft standing orders are to be resubmitted before the CO. If CO is satisfied, he approves the same under the Code of 2020. This article will deal with the question of remedy available under §32 of IRC to an employer and a trade union/negotiating authority on behalf of employees if he/it is not satisfied with the orders of CO and the conundrum surrounding the same.
APPEALS AGAINST THE ORDERS OF CERTIFYING OFFICER AND UNCERTAINTY SURROUNDING IT
When the employer or/and the trade union or any other negotiating authority on behalf of the employees is unsatisfied with the orders of CO, he/it may file an appeal against the orders under §32 of IRC before the appellate authority (AA) appointed under §2(a) of IRC by the appropriate government (as defined under § 2(b) of IRC). The authority holds the power to dispose of the appeal in the way it deems fit. CO and AA, both have authority as that of a civil court for “receiving evidence”, “administering oath”, “enforcing the attendance of witnesses” and “compelling the discovery and production of documents” under § 31(1) of IRC. The AA can confirm the order of the officer or amend it but cannot set aside the orders completely. Now the question arises whether there lies an appeal against the orders of AA. Before the consolidation of the enactments, this question was regulated by §6 of the Standing Orders Act of 1946 which incorporated a finality clause elucidating that any decision by AA “Shall be Final”. On the contrary, to one’s notice, §32 of the Code does not incorporate a finality clause as under §6 of the Act rendering it implied that an appeal can lie but how, when and under what circumstances is a grey area which is yet to be dealt and interpreted by the Court. There has been a landmark judgment of Shahdara (Delhi) Saharanpur Light Rly. Co. Ltd v. Saharanpur Rly. Workers Union which effectively interprets the finality clause and its application. The provision under §32 of IRC is very much in line with the interpretation made by the court in this Judgment. Hence, it becomes indispensable to understand the reasoning of the said Judgment to anticipate the interpretation of §32 of the Code.
ASCERTAINING FINALITY OF APPELLATE AUTHORITY’S ORDERS THROUGH THE LENS OF SHAHDARA VERDICT : AN ANALYSIS
§6 of the Act dictates that the decision of AA shall be final and §10 provides for modifications to certified orders only if an agreement is made between both the parties. The concern for the court in the said Judgment was to ascertain the scope of §10. Another pertinent question was that the Act provides for modifications then what was the need to incorporate the finality clause.
Here, the company got its standing orders certified by CO under §4 of the Act in August 1962, and on appeal, the AA modified it in December 1963. An application for modification was filed by the workmen and the CA passed an order in April 1965 which was again appealed before the AA which, in October 1967 upheld certain modifications while striking the rest. An SLP was filed by the Company and it was contended that under §10(2) of the Act, once the orders are certified, they can be modified only when there have been changes in circumstances.
Conventionally, awarding an order with finality implies that there lies no further appeal or revision against the order. This interpretation is backed by §12 of the Act which dictates that once certified, no oral evidence can be taken to a court but a comprehensive reading of §6 and §12 unveils that indeed, no appeal lies against the order in a civil court but the questioned order is subjected to the modification of the AA. Thus, the Court held that the finality clause keeps the order outside the appellate purview of a civil court but is itself subjected to modifications by AA or CO under §10(2).
Another pertinent contention was that the finality clause was incorporated to maintain stability and bypass fluctuations in an organization but if modification of the orders is made easy, a multiplicity of applications will destroy the very intent behind such an incorporation. Further, it was stated that if the provisions are read comprehensively, there lies no intention of the legislators on the contrary to the interpretation that modification should be allowed only when a change in circumstance is established. Agreeing with the latter part of the contention the Court held that indeed there existed no such contrary intention of the lawmakers but the Act is a beneficent legislation and it would be unjustified to infer a restriction on a right owing to anticipation for a flood of applications. Thus, the requirement of change in circumstance was held incorrect.
Removal of the finality clause from §32 of IRC is a step taken to give effect to this interpretation made by the court without any scepticism. Admission of new oral evidence in the court after the certification of the orders is still prohibited under §36 of IRC implying that the orders are still outside the purview of the appellate jurisdiction of a civil court but the removal of the finality clause indicates that those certified orders are indeed subjected to the modifications made by the certifying authority (CO or AA) itself. The provision is anticipated to be interpreted accordingly by the courts in the coming time.
CONCLUDING REMARKS
The scrapping of the finality clause but rendering oral evidence inadmissible in court post-certification implies that an appeal against the orders may not lie in the civil court but is indeed subjected to the modifications authorized by the certifying authority. Prior to the said Judgment, § 10 of the Act was interpreted by the employers as to be only applicable when there were certain changes in circumstances. Such interpretation resulted in a gross exploitation of the workers. If no objections were raised by the worker union/representative during the certification, subsequently, they could not apply for modifications as no change in circumstances was observed. The Judgment set the course correction which has been given effect by removing the “finality clause” from §32 of the Code altogether. The practice of formulating standing orders has benefitted the workers largely, in absence of which, the employer might act arbitrarily and workers being unaware of their rights and obligations will get exploited. Thus, being a beneficent legislation, curbing the right to apply for modifications will be unjust. Consequently, flood of applications is anticipated and disposal of such applications become a task for the certifying authority. Thus, in suggestion, no single application by an employee should be allowed to be directly filed before the CO. It should be first presented to the labor union/ labor representative/ trade union which could forward the application after scrutinizing its merits.
Shambhavi Shani, 3rd Year Student, HNLU Raipur.
Picture Credits: The Hindu
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