Wage Settlement Without Union: Is It Possible and Enforceable in Maharashtra?

Wage Settlement Without Union Involvement

Can the management and workers have a wage settlement in the absence of any union? If yes, will this settlement be enforceable if done without the participation of government authorities?

Thanks in advance...!!!

Only when a problem arises does the union or the government authority interfere in the settlement. If the workers are happy with the settlement, they can proceed. However, it is best to inform the union members about the settlement.

Regards,

If it is only a management and employee settlement, and both parties are happy, they can proceed. Unless the employees accept, the settlement will not be finalized.

If no union of workers is functioning in an industry, the workers can elect five representatives to negotiate and arrive at a settlement with management on the workers' demands. The copies of the settlement need to be sent to the prescribed authorities as per Maharashtra Industrial Dispute Rules. Then, this settlement becomes a legal one.

Regards,
Gajare M B.

Settlement with all individual workmen/employees without unions is valid. A copy of the settlement arrived at with each person should be sent to the Labour Department for registration. This is called a Sec.18(1) settlement under the I.D. Act without government authority. This is valid in law and executable. However, in reality, it is not possible when unions are existing.

Regards,
D. Gurumurthy HR/IR Consultant

Dear Seniors, I just want to know what is the basic difference when a settlement arrives under Section 12(3) or 18(1) of the ID Act.

Regards,
N K SHARMA

Understanding Settlement Differences Under the ID Act

I, along with Mr. NK Sharma, would like to know the basic differences in settlement under SEC 12/3 and 18/1 of the ID Act. I request the seniors and experts in this forum to advise.

Thanks,

Ravi

Yes, but before that, you have to inform the registered union leader of your establishment in the prescribed manner regarding the settlement issue. Even if the union leader does not attend, you should settle the issue with the help of a leading member of the union as a representative of the union leader, with the participation of the government.

Regards,
Laxman

Settlement Agreement Process

Get the individual workers to sign separate letters addressed to the company, agreeing to the settlement that has been reached. Additionally, all the workers should sign jointly, which becomes part of the settlement as an annexure.

12/3 is a long-term agreement for three years and above.

18/1 is a one-year settlement between an employee and an employer, and a copy is sent to conciliation.

Regards,
Uma

Understanding Wage Settlements

12/3 settlement is tripartite (management, union, and government).

18/1 settlement is bipartite (management and union).

Thank you.

Yes, without a union, a settlement can also be done with the workmen. They can select an internal body to have negotiations with the management. This way, it is also good. Always, both management and the union can have a friendly relationship to avoid external interferences as well.

Regards,
V R Murthy

Long-term Settlements: Sec 18(1) and Sec 12(3)

Any long-term settlements generally span over a period of 3-5 years, either under Sec 18(1) or Sec 12(3). There is no rule stating that Sec 18(1) is only for one or two years.

Sec 18(1) is a bipartite agreement between management and employees/unions without the intervention of conciliation, and the agreement is applicable and binding for all workers.

Sec 12(3) is a tripartite agreement among management, employees/unions, and a conciliator. Generally, this is referred to a conciliator when management and employees/unions cannot reach an agreement or consensus, and the need for settlement of disputes arises.

I hope this makes sense.

Regards, Sarisri

Long-term Settlement Duration

Any long-term settlement generally spans over a period of 3-5 years, either under Sec 18(1) or Sec 12(3). There is no rule stating that Sec 18(1) is limited to only one or two years.

Sec 18(1) Agreement

Sec 18(1) is a bipartite agreement between management and employees/unions without the intervention of conciliation, and the agreement is applicable and binding on all workers.

Sec 12(3) Agreement

Sec 12(3) is a tripartite agreement among management, employees/unions, and a conciliator. Generally, this is referred to the conciliator when management and employees/unions cannot reach an agreement or consensus, and the need for settling disputes arises.

I hope this explanation makes sense.

Best regards,
sarisri

Definition of Settlement under the Industrial Disputes Act

Section 2(p) of the Industrial Disputes Act defines "settlement" as an agreement reached during conciliation proceedings. It includes a written agreement between the employer and workmen reached outside of conciliation proceedings, signed by the parties, and sent to an authorized officer by the appropriate Government and the conciliation officer.

Binding Nature of Settlements and Awards

Section 18. Persons on whom settlements and awards are binding: (1) A settlement reached between the employer and workmen outside conciliation proceedings is binding on the parties unless signed by specific authorized persons as defined by the Act. Otherwise, the settlement is considered illegal, null, and void.

Signing Authority under Tamilnadu Industrial Disputes Rules

Rule 25(2)(b) of the Tamilnadu Industrial Disputes Rules specifies who can sign a settlement on behalf of the workmen. It does not address the "Five Men Committee" or "Internal Sole Bargaining Agent" as claimed by the ITC Limited management in Tiruvottiyur.

Rule 25(2)(b) of the Tamilnadu Industrial Disputes Rules states that a settlement shall be signed by the employer or their authorized agent and by specific representatives of the workmen as detailed in the rule.

Settlement Agreements in the Absence of a Union in Tamilnadu

In Tamilnadu, if there is no union, a settlement agreement between workers and management must be signed by representatives authorized by the majority of workmen. Otherwise, it cannot be considered a settlement as defined in section 2(p) of the Industrial Disputes Act.