Who Can Sign a Settlement in Collective Bargaining? Insights on Union Amalgamation and Authority Roles

Please provide practical inputs on who can sign a settlement (LTS) in the case of CB. Can the "Core Negotiation Team" sign it? What would it mean if a signing authority is an Occupier or someone else (authorized), etc. - what would each infer?

Amalgamation of Unions for Settlement
How would this work in the case of an amalgamation of many unions into one for the purpose of settlement?

Regards,
Mahesh

Dear Mahesh, any settlement should be signed by a principal employer or an authorized representative thereof, who has specifically been given the power in writing; otherwise, it would be null under law if challenged. Since under the Factories Act, an occupier is treated as the principal employer, he has deemed power and can sign any agreement. Otherwise, any person authorized by the occupier or the company's Board can sign a settlement.

Query About Amalgamation of Unions

The last query about the amalgamation of unions into one, raised by you, is not clear to me. Please clarify.

Regards,
pkjain

From Management:
The Manager under the Factories Act should definitely sign if the occupier is not signing. Any authorized person can sign. I have seen instances where the Unit Head and HR Manager sign the settlement. More than legality, look at internal issues. If two or three senior executives of the company sign the agreement, legality cannot be questioned.

Union:
In case of amalgamation, ensure one representative from each union signs. Also, ensure that the signatory is either the President or Secretary of the Union.

Regards,
T. Sivasankaran

Your query is also not understood by me. LTS, do you mean Long Term Settlement with the union by the employer?

Clarification Needed on CB

What is CB?

Amalgamation of Unions

Regarding the amalgamation of many unions, do you mean many unions joining in arriving at a settlement or being parties to the settlement jointly? You need to explain and elaborate on this.

In my view, in any settlement, the negotiating parties can sign the deed of settlement with implied authority. This agreement is between the negotiating parties. Signatures are typically done on behalf of parties with their respective designations, which can be briefly described in a short recital in the deed of settlement.

Authority can also be submitted in writing if required by the other party. If any party disputes the authority of the other party, then it does not constitute an agreement or settlement.

Signing Authority in Long-Term Settlements

In the case of a long-term settlement of charter demands by the union, the CEO or HR Head from the employer's side usually signs the deed of settlement, while the President or Secretary/Joint Secretary of the union signs from the union's side. The negotiating team signs as witnesses.

Settlements can be either bipartite or multipartite. Long-term settlements of charter demands are generally bipartite agreements.

Please let me know if you need further clarification or information.

Thank you.

Generally, "CB" stands for Conciliation Board as defined under the ID Act (Board for Conciliation). Mr. Mahesh used the same term, as it appears to me.

Regards,
Shri Keshav

Understanding Collective Bargaining (CB) and Signing Authority

CB means collective bargaining. Any officers or managers authorized to negotiate with the union are authorized to sign wage negotiation settlements as they are part of the collective bargaining process and they know each and every point of the settlement. Usually, the CEO, HR, and accounts personnel, or in some cases, the managing director of the company, would sign the wage settlements. It varies from company to company. It all depends on the policy of the company.

Regards,
G.K. Manjunath, Sr. Manager-HR

I wish to add another point. In this term, there is also a "DISCIPLINARY AUTHORITY" under the Employment Standing Orders who can generally be more involved in matters related to "the Industrial Dispute Act 1947," and the appointing Authority is the Disciplinary Authority. The disciplinary authority definitely signs CB.

If the settlement proposed to be signed falls under the provisions of the Industrial Disputes Act 1947, the rules framed by the respective State Governments and the Central Government must be consulted to determine who is authorized to sign a settlement under the Act. I will address this question with reference to the Tamil Nadu Industrial Disputes Rules.

Signing Authority Under Tamil Nadu Industrial Disputes Rules

According to Rule 25 of the Tamil Nadu Industrial Disputes Rules, a settlement should be signed by:

- In the case of an employer, by the employer themselves or by their authorized agent. When the employer is an incorporated company or other body corporate, the settlement can be signed by the agent, manager, or other principal officer of the corporation.

In the case of workmen, the settlement can be signed by:

- The President or Secretary of a registered trade union of workmen, or
- Two office bearers of the union authorized by the President or Secretary, or
- Five representatives of workmen duly authorized for this purpose at a meeting of the workmen attended by the majority of the workmen concerned.

If the number of affected workmen is two or fewer, the settlement may be signed by the workman or workmen concerned.

The Madras High Court has ruled that if the settlement is not signed by the individuals specified in Rule 25, the settlement becomes invalid.

Similar provisions exist in the rules framed under the Industrial Disputes Act by the various States and the Central Government.

I was going through the Industrial Dispute Act today and found certain provisions related to our discussion in this thread. I thought of sharing them with you. The said provisions are reproduced as follows:

As per Industrial Disputes (Bombay) Rules 1957:

According to Rule 62(2), the settlement shall be signed by:

- (a) In the case of an employer, by the employer himself, or by his authorized agent, or where the employer is an incorporated company or other body corporate, by the agent, manager, or other principal officer of such company or body;
- (b) In the case of the workmen, either by the President or Secretary or such other officer of a trade union of the workmen as may be authorized by the Executive Committee of the Union in this behalf, or by five representatives of the workmen duly authorized in this behalf at a meeting of the workmen held for the purpose.

As per Industrial Dispute (Central) Rules 1957:

According to Rule 58(2), the settlement shall be signed by:

- (a) In the case of an employer, by the employer himself, or by his authorized agent, or when the employer is an incorporated company or other body corporate, by the agent, manager, or other principal officer of the corporation;
- (b) In the case of the workmen, by any officer of a trade union of the workmen or by five representatives of the workmen duly authorized in this behalf at a meeting of the workmen held for the purpose.

In this rule, "officer" means any of the following officers, namely:

- (a) the President;
- (b) the Vice-President;
- (c) the Secretary (including the General Secretary);
- (d) a Joint Secretary;
- (e) any other officer of the trade union authorized in this behalf by the President and Secretary of the Union.

Regards.