Report in which the committee requests to be kept informed of development - Report No 284, November 1992

Case No 1517 (India) - Complaint date: 09-DEC-89 - Closed

1. 443. The Committee already examined this case, presented by the Federation of Medical and Sales Representatives' Associations of India (FMRAI), at its May 1991 meeting when it submitted interim conclusions to the Governing Body (278th Report, paras. 309 to 346, approved by the Governing Body at its 250th Session (May-June 1991)).
2. 444. The complainant sent further information in a letter received on 2 September 1991. The Government sent its observations on the case in a communication dated 12 August 1992.
3. 445. India has not ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), or the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. Previous examination of the case

1. 446. The FMRAI alleged that a state-owned pharmaceutical company, Indian Drugs and Pharmaceuticals Ltd. (IDPL), had launched an attack on the Federation and its members and leaders in retaliation for its anti-corruption activities, and undertook the following anti-union acts: (i) transfers, in June 1989, of 20 union leaders and activists despite an agreement to the contrary; (ii) a lockout, on 20 August 1989, of union members in Calcutta after they condemned management attempts to set up a rival union; (iii) unilaterally declaring a lawful strike, called on 21 August 1989, to be illegal; (iv) penalising - by means of pay deductions - workers who participated in strike action on 21 August and 5 October 1989; (v) victimising and harassing union members and leaders such as the issuing of charge-sheets; (vi) denying union leaders the right to take leave for their trade union activities despite an exchange of letters in April 1985 guaranteeing this special leave; (vii) unilaterally suspending in September 1989 meetings of an in-company grievance committee; and (viii) unilaterally withdrawing recognition on 12 October 1989 from the Federation at the start of the 1989 wage negotiations, and instead according recognition to a newly established "puppet organisation" called the IDPL Field Workers' Union.
2. 447. The Government replied first that, as regards the alleged discriminatory transfer of union activists, the exchange of letters cited by the union did not constitute an "agreement" and the FMRAI had in fact acknowledged this in the course of proceedings in the High Court of Andhra Pradesh; secondly, that the lockout at the Calcutta office of IDPL was a response to the prevailing law and order situation and serious threats of violence; thirdly, as concerns the strike notice served by FMRAI, the company had, in the manner prescribed by the Industrial Disputes Act, 1947, referred the matter to government conciliation machinery and the union did not attend the conciliation proceedings (it adds that strike action is illegal whilst conciliation proceedings are pending); fourthly, on the deduction of pay in respect of participation in the illegal strikes, that this was necessary in order to maintain discipline amongst the employees of the company, and was in accordance with the Wages Act; fifthly, that the issuing of charge-sheets was the normal procedure to be followed in cases of alleged breaches of company rules and it is not true that management intimidated officials and activists of FMRAI; sixthly, that while in the past some workers had been allowed extra leave on an informal basis to attend to union affairs, this facility had been withdrawn because FMRAI no longer represented the majority of medical representatives employed by the company, and the newly recognised union had not expressed any need for such a facility; seventhly, it pointed out this lack of representativity meant that the Field Workers' Union participates in activities of the grievance committees; and lastly it denied that the company "derecognised" FMRAI, pointing out that since the majority of medical representatives had chosen to join another registered union, the company had to deal with the new body.
3. 448. At its May-June 1991 Session, in the light of the Committee's interim conclusions, the Governing Body approved the following recommendations:
   • (a) That the complainant is asked to provide, as soon as possible, all information to which it has access in relation to: (i) the positions within the union which were held by the workers transferred by management of IDPL in June 1989; (ii) the number of workers who refused to accept transfer and the number who were subjected to disciplinary action or who were dismissed in consequence; (iii) any evidence which shows that the transfers constituted acts of anti-union discrimination; and (iv) as to the circumstances of the lockout at the Calcutta office of IDPL in August 1989.
   • (b) That the Government is asked to provide, as soon as possible, further information relating to: (i) the circumstances of the lockout at the Calcutta office of IDPL in August 1989; (ii) the outcome of the court proceedings which were brought to challenge the deductions of eight days' pay from workers who participated in strike action in August and October 1989; (iii) the provisions of the Wages Act which allegedly justified these deductions of pay; and (iv) the evidence which shows that the majority of workers at IDPL belong to the Field Workers' Union.
   • (c) That the Government should give serious consideration to the adoption of legislation which lays down objective procedures for determining the representative status of trade unions and which provides adquate safeguards for the position of minority and competing unions.

B. The complainant's further information

1. 449. In a letter received on 2 September 1991, the FMRAI gives the information requested by the Committee: (i) the workers transferred in June 1989 were all - bar two - local committee members or convenors and presidents of branches of the FMRAI; (ii) three workers refused the transfer and presumably resigned, ten refused and were dismissed, seven accepted under pressure and one is suspended without pay while his case is before the Calcutta High Court; (iii) proof that these transfers were anti-union in nature lies in the fact that, before the FMRAI had started agitating against the IDPL's corrupt practices, there had been no history of mass dismissals in the company; also, the transfers affect only FMRAI activists and no inquiry was carried out by management before these punishments were introduced; and (iv) it supplies a copy of an order from the 8th Court, Calcutta, dated 21 September 1989 in Case No. m/786/89 stating that "no breach of peace at the locale as per report submitted by the police" as proof that the Government's justification for the August 1989 lockout was false. The complainant adds that the High Court, on 20 February 1990, declared that the IDPL's withholding of eight days' wages for the one-day strike was illegal and ordered repayment of seven days' wages. According to the Bihar Government's "Code of Discipline in Industry" supplied by the FMRAI, before withdrawing recognition of unions the employer should obtain the prior approval of the Tripartite Standing Committee whose decision on the matter is final. Also under this Code "where there is more than one union, the one claiming recognition should have been functioning at least one year after its registration". The complainant thus alleges that the IDPL's recognition of the Field Workers' Union was flawed as that happened even before the union was registered.

C. The Government's further reply

1. 450. In its letter of 12 August 1992, the Government encloses the IDPL's comments. First, it points out that the FMRAI should have provided a list of protected workers if it wished to enjoy the protection of the Industrial Disputes Act, 1947. Those workers were transferred in accordance with their conditions of service and the High Court of Andhra Pradesh upheld this on appeal. The management figures on the transfers more or less correspond to those provided by the FMRAI: nine accepted (presumably the seven listed by the complainant plus the two non-union members) and 14 refused, of whom three decided to resign and one is on sick leave. Disciplinary proceedings were thus instituted against ten, which decided on their dismissal; three appealed against the dismissals, one being rejected by the court in February 1992 and the other two pending. The management denies that the transfers were vindictive or based on anti-union motives; they were essential from the administrative point of view to tone up the marketing side of the company.
2. 451. In response to the requests made by the Committee at its last examination of this case, the Government replies that: (i) the August 1990 lockout at the Calcutta office of the IDPL was due to the grave law and order situation created by some members of the FMRAI who were opposed to the transfers (it encloses a copy of the complaint lodged by the Calcutta management with the police, alleging that 50 to 60 FMRAI members entered the premises shouting slogans and posting bills, verbally and physically abusing staff, breaking tables, glasses and chairs and ransacking documents and offices; the local magistrate ordered the police to take the necessary precautionary measures including a police picket of the premises; the lockout lasted from 20 August until 20 November 1989); (ii) the High Court directed the management to refund the pay deducted for the one-day strike, which it has done, but it has appealed against the order as well; (iii) section 9 of the Wages Act, 1936 (copy supplied), authorises deductions for absence from duty; and (iv) since the management entered into a memorandum of understanding with the registered Field Workers' Union, the FMRAI challenged this before the Patna High Court, which found that non-parties to the understanding could raise an industrial dispute with the labour authorities; as the FMRAI did not do this the management asserts that it does not command a large following.
3. 452. As for the Committee's recommendation in paragraph 346(c), the Government states that there is no central legislation on recognition of unions by management and that 1978 and 1988 Bills for such a purpose did not pass. The tripartite Indian Labour Conference, at its April 1990 Session, recommended that a bipartite committee look at reforming the industrial relations system but the committee's report was not unanimous on many important issues. The federal and state ministers are examining the issue so as to formulate a Bill. The contentious point seems to be the verification of union strength through check-off or secret ballots.

D. The Committee's conclusions

1. 453. This complaint relates to alleged anti-union discrimination (transfers, dismissals, withholding of wages for a one-day strike and recognition of a rival union) on the part of the management of Indian Drugs and Pharmaceuticals Ltd. (IDPL). According to the complainant these discriminatory acts had been taken in retaliation for the union's attempts to expose unfair and corrupt practices in IDPL. The Government states that the transfers were for administrative reasons and that the dismissals followed disciplinary proceedings related to the refusal to accept the transfers.
2. 454. The Committee notes that the management has respected a court order to pay back wages withheld because of a one-day strike and asks the Government to keep it informed of the outcome of the appeal lodged against that court order by the management.
3. 455. The Committee also notes that, of those workers ordered to transfer, ten refused and were dismissed, two of whom have appeals against dismissal pending. On the weight of the further information supplied by the parties, it appears to the Committee that these transfers and dismissals, and the Calcutta office lockout were aimed against one specific union, the FMRAI and the company's links to the other union confirm this. The Committee draws the Government's attention to the need for adequate protection against acts of anti-union discrimination.
4. 456. The Government does not provide evidence (for example, check-off lists or the holding of a vote) showing that the majority of the IDPL employees have joined the rival union which has signed a memorandum of understanding (covering wages revision) with the management, but merely states that the FMRAI did not act on a suggestion from the Patna High Court that it lodge a dispute before the labour authorities. This state of affairs leads the Committee to the conclusion - already expressed in its previous examination of this case - that provisions should be adopted in the national legislation covering recognition for collective bargaining purposes of organisations representative of the workers employed in a bargaining unit. In past cases the Committee has stated that in order to encourage the harmonious development of collective bargaining and to avoid disputes, it should always be the practice to follow, where they exist, the procedures laid down for the designation of the most representative unions for collective bargaining purposes when it is not clear by which unions the workers wish to be represented. In the absence of such procedures, the authorities, where appropriate, should examine the possibility of laying down objective rules in this respect (Digest of decisions and principles of the Freedom of Association Committee, 3rd edition, 1985, para. 24).
5. 457. Since the Government recognises that the Industrial Disputes Act, 1947, does not make any provision for either the "recognition" or "derecognition" of trade unions for these purposes and states that various attempts at reforming the industrial relations system have resulted in the current examination of the issue by federal and state ministers, the Committee would request it to keep it informed of progress towards adopting such provisions. Action towards this is critical in the Committee's opinion since this very case shows that in the absence of any objective procedure for the verification of majority representation, it is open to a "derecognised" organisation such as FMRAI to allege that it has not in fact lost its majority status, or that it has done so only because of the adoption of unfair tactics by the employer.

The Committee's recommendations

1. 458. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) The Committee urges the Government once again to consider adopting legislative provisions which lay down objective procedures for determining the representative status of trade unions, in the framework of the current examination of this issue by federal and state labour ministers.
   • (b) The Committee requests the Government to keep it informed of progress towards the adoption of such provisions.
   • (c) The Committee requests the Government to keep it informed of the outcome of the appeal lodged by the management of Indian Drugs and Pharmaceuticals Ltd. concerning the reimbursement of wages that had been withheld.