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Q.NotesonLayoff,Lockout,Retrenchment,Strike.
Section2(kkk)Layoff
Layoffmeansfailure,refusal,orinabilityofaemployertogiveemploymenttoaworkmanwhosenameisonthemusterrolls
ofhisindustrialestablishmentandwhohasnotbeenretrenched,ontheaccountoflackofcoal,lackofpower,lackofraw
material,overstockingofoutput,failureofmachinery,duetonaturalcalamity,orduetoanyotherconnectedreason.
CentralIndiaSpinning,Weaving,andManufacturingCo.Ltd.NagpurvsStateIndustrialCourt1959Heldthatthewords,
"failure,refusal,orinability"arekeytothedefinitionandmeansthattheunemploymentisduetoacauseindependentofany
actionorinactionoftheworkmen.
Temporary
Duetoreasonsbeyondemployer'scontrol
Duetoeconomicreasons
nonintentional
RightsandObligationsResultingfromlayoff
Layoffisnotarightconferredupontheemployerbutanobligationthattheunemploymentistemporaryinnatureandina
reasonabletimethelaidoffworkerwillberestoredhisposition.However,thereisnoindicationregardingthetimelayoffwill
continue.

25C.RIGHTOFWORKMENLAIDOFFFORCOMPENSATION
Wheneveraworkman(otherthanabadliworkmanoracasualworkman)whosenameisborneonthemusterrollsofan
industrialestablishmentandwhohascompletednotlessthanoneyearofcontinuousserviceunderanemployerislaidoff,
whethercontinuouslyorintermittently,heshallbepaidbytheemployerforalldaysduringwhichheissolaidoff,exceptfor
suchweeklyholidaysasmayintervene,compensationwhichshallbeequaltofiftypercentofthetotalofthebasicwages
anddearnessallowancethatwouldhavebeenpayabletohimhadhenotbeensolaidoff:
Providedthatifduringanyperiodoftwelvemonths,aworkmanissolaidoffformorethanfortyfivedays,nosuch
compensationshallbepayableinrespectofanyperiodofthelayoffaftertheexpiryofthefirstfortyfivedays,ifthereisan
agreementtothateffectbetweentheworkmanandtheemployer:
Providedfurtherthatitshallbelawfulfortheemployerinanycasefallingwithintheforegoingprovisotoretrenchthe
workmaninaccordancewiththeprovisionscontainedinsection25Fatanytimeaftertheexpiryofthefirstfortyfivedaysof
thelayoffandwhenhedoesso,anycompensationpaidtotheworkmanforhavingbeenlaidoffduringtheprecedingtwelve
monthsmaybesetoffagainstthecompensationpayableforretrenchment.
Explanation:"Badliworkman"meansaworkmanwhoisemployedinanindustrialestablishmentintheplaceofanother
workmanwhosenameisborneonthemusterrollsoftheestablishment,butshallceasetoberegardedassuchforthe
purposesofthissection,ifhehascompletedoneyearofcontinuousserviceintheestablishment.

25M.PROHIBITIONOFLAYOFF.
(1)Noworkman(otherthanabadliworkmanoracasualworkman)whosenameisborneonthemusterrollsofanindustrial
establishmenttowhichthisChapterappliesshallbelaidoffbyhisemployerexceptwiththepriorpermissionofthe
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appropriateGovernmentorsuchauthorityasmaybespecifiedbythatGovernmentbynotificationintheOfficialGazette
(hereinafterinthissectionreferredtoasthespecifiedauthority),obtainedonanapplicationmadeinthisbehalfunlesssuch
layoffisduetoshortageofpowerortonaturalcalamity,andinthecaseofamine,suchlayoffisduealsotofire,flood,
excessofinflammablegasorexplosion.
(2)Anapplicationforpermissionundersubsection(1)shallbemadebytheemployerintheprescribedmannerstating
clearlythereasonsfortheintendedlayoffandacopyofsuchapplicationshallalsobeservedsimultaneouslyonthe
workmenconcernedintheprescribedmanner.
(3)Wheretheworkmen(otherthanbadliworkmenorcasualworkmen)ofanindustrialestablishment,beingamine,have
beenlaidoffundersubsection(1)forreasonsoffire,floodorexcessofinflammablegasorexplosion,theemployer,in
relationtosuchestablishment,shall,withinaperiodofthirtydaysfromthedateofcommencementofsuchlayoff,apply,in
theprescribedmanner,totheappropriateGovernmentorthespecifiedauthorityforpermissiontocontinuethelayoff.
(4)Whereanapplicationforpermissionundersubsection(1)orsubsection(3)hasbeenmadetheappropriateGovernment
orthespecifiedauthority,aftermakingsuchinquiryasitthinksfitandaftergivingareasonableopportunityofbeingheardto
theemployer,theworkmenconcernedandthepersonsinterestedinsuchlayoff,may,havingregardtothegenuinenessand
adequacyofthereasonsforsuchlayoff,theinterestsoftheworkmenandallotherrelevantfactors,byorderandforreasons
toberecordedinwriting,grantorrefusetograntsuchpermissionandacopyofsuchordershallbecommunicatedtothe
employerandtheworkmen.
(5)Whereanapplicationforpermissionundersubsection(1)orsubsection(3)hasbeenmadeandtheappropriate
Governmentorthespecifiedauthoritydoesnotcommunicatetheordergrantingorrefusingtograntpermissiontothe
employerwithinaperiodofsixtydaysfromthedateonwhichsuchapplicationismade,thepermissionappliedforshallbe
deemedtohavebeengrantedontheexpirationofthesaidperiodofsixtydays.
(6)AnorderoftheappropriateGovernmentorthespecifiedauthoritygrantingorrefusingtograntpermissionshall,subjectto
theprovisionsofsubsection(7),befinalandbindingonallthepartiesconcernedandshallremaininforceforoneyearfrom
thedateofsuchorder.
(7)TheappropriateGovernmentorthespecifiedauthoritymay,eitheronitsownmotionorontheapplicationmadebythe
employeroranyworkman,reviewitsordergrantingorrefusingtograntpermissionundersubsection(4)orreferthematter,
or,asthecasemaybe,causeittobereferred,toaTribunalforadjudication:
ProvidedthatwhereareferencehasbeenmadetoaTribunalunderthissubsection,itshallpassanawardwithinaperiodof
thirtydaysfromthedateofsuchreference.
(8)Wherenoapplicationforpermissionundersubsection(1)ismade,orwherenoapplicationforpermissionundersub
section(3)ismadewithintheperiodspecifiedtherein,orwherethepermissionforanylayoffhasbeenrefused,suchlayoff
shallbedeemedtobeillegalfromthedateonwhichtheworkmenhadbeenlaidoffandtheworkmenshallbeentitledtoall
thebenefitsunderanylawforthetimebeinginforceasiftheyhadnotbeenlaidoff.
(9)Notwithstandinganythingcontainedintheforegoingprovisionsofthissection,theappropriateGovernmentmay,ifitis
satisfiedthatowingtosuchexceptionalcircumstancesasaccidentintheestablishmentordeathoftheemployerorthelike,it
isnecessarysotodo,byorder,directthattheprovisionsofsubsection(1),or,asthecasemaybe,subsection(3)shallnot
applyinrelationtosuchestablishmentforsuchperiodasmaybespecifiedintheorder.
(10)Theprovisionsofsection25C(otherthanthesecondprovisothereto)shallapplytocasesoflayoffreferredtointhis
section.
Explanation:Forthepurposesofthissection,aworkmanshallnotbedeemedtobelaidoffbyanemployerifsuchemployer
offersanyalternativeemployment(whichintheopinionoftheemployerdoesnotcallforanyspecialskillorprevious
experienceandcanbedonebytheworkman)inthesameestablishmentfromwhichhehasbeenlaidofforinanyother
establishmentbelongingtothesameemployer,situateinthesametownorvillage,orsituatewithinsuchdistancefromthe
establishmenttowhichhebelongsthatthetransferwillnotinvolveunduehardshiptotheworkmanhavingregardtothefacts
andcircumstancesofhiscase,providedthatthewageswhichwouldnormallyhavebeenpaidtotheworkmanareofferedfor
thealternativeappointmentalso.

Section2(oo)Retrenchment
Retrenchmentmeansterminationofserviceofanemployeebyanemployerforanyreasonotherthanasapunishmentdue
todisciplinaryaction.Thisdoesnotincludevoluntaryretirement,superannuation,nonrenewalofcontract,terminationon
thegroundofcontinuedillhealth.
Foranyreasonwhatsoeversurplusage,redundancyduetoadvancedmachinery,slowdowninbusiness.Reasondoes
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notmatter.
DC&GMillsvsShambhuNath1978Duetoreorganization,afewworkersweremaderedundant.Insteadofretrenching
them,theywereabsorbedinotherplaces.Oneworkerwasgivenemploymentinanotherdept.withsamepay.However,due
tolackofperformance,hewasshiftedtoanotherdept.However,herefusedtogotoanotherdept.andaskedforonemore
chance.Hewasthenremovedfromtherolls.Thiswasheldretrenchment.
MorindaCoopSugarMillsvsRamKishenandothers1996Workerswereemployedinthesugarmillonlyduringthe
seasonandthentheyceasedtowork.Heldthatitisnotretrenchmentbecauseitisonlyseasonalwork.
SantoshGuptavsSBI1980Aworkerwasremovedafterhefailedatestthathewasrequiredtopassforconfirmationof
service.SCheldittoberetrenchmentbecauseterminationforanyreasonisretrenchmentexceptifitisbecauseofthe
reasonsmentionedintheact.

VRS
PanjabNationalBankvsVirendraKumarGoel2004SCheldthatemployeeswhooptedforvoluntaryretirementand
availedanypartofretirementbenefitswerenoteligibleforretraction.
Illhealth
LalitMohanPurivsPureDrinks1992AemployeewasaskedtoappearbeforeESIdoctortoproveillhealth.Hefailedto
appear.Hewasthenremoved.SCheldmerelyrefusaltoappearformedicalexaminationshouldnotbeconstruedasill
healthandheldittoberetrenchment.
ContractofEmployment(subclausebb)
InthecaseofDilipHanumanShirkevsZillaParishadYavatmal1990Heldthatthesubclausebbthatallowsanemployer
tonotrenewtheemploymentcontractmustbereadrestrictively.Thedurationofemploymentmustbereadasperthenature
ofworkandnotfromjusttheemploymentletterotherwiseitwillbeabusedbytheemployers.

Section25F.CONDITIONSPRECEDENTTORETRENCHMENTOFWORKMEN
Noworkmanemployedinanyindustrywhohasbeenincontinuousservicefornotlessthanoneyearunderanemployer
shallberetrenchedbythatemployeruntil
(a)theworkmanhasbeengivenonemonth'snoticeinwritingindicatingthereasonsforretrenchmentandtheperiodof
noticehasexpired,ortheworkmanhasbeenpaidinlieuofsuchnotice,wagesfortheperiodofthenotice
(b)theworkmanhasbeenpaid,atthetimeofretrenchment,compensationwhichshallbeequivalenttofifteendays'average
payforeverycompletedyearofcontinuousserviceoranypartthereofinexcessofsixmonthsand
(c)noticeintheprescribedmannerisservedontheappropriateGovernmentorsuchauthorityasmaybespecifiedbythe
appropriateGovernmentbynotificationintheOfficialGazette.

Section25G.PROCEDUREFORRETRENCHMENT
Whereanyworkmaninanindustrialestablishment,whoisacitizenofIndia,istoberetrenchedandhebelongstoa
particularcategoryofworkmeninthatestablishment,intheabsenceofanyagreementbetweentheemployerandthe
workmaninthisbehalf,theemployershallordinarilyretrenchtheworkmanwhowasthelastpersontobeemployedinthat
category,unlessforreasonstoberecordedtheemployerretrenchesanyotherworkman.

Section25N.CONDITIONSPRECEDENTTORETRENCHMENTOFWORKMEN
1. NoworkmanemployedinanyindustrialestablishmenttowhichthisChapterapplies,whohasbeenincontinuous
servicefornotlessthanoneyearunderanemployershallberetrenchedbythatemployeruntil
1. theworkmanhasbeengiventhreemonths'noticeinwritingindicatingthereasonsforretrenchmentandthe
periodofnoticehasexpired,ortheworkmanhasbeenpaidinlieuofsuchnotice,wagesfortheperiodofthe
noticeand
2. thepriorpermissionoftheappropriateGovernmentorsuchauthorityasmaybespecifiedbythatGovernment
bynotificationintheOfficialGazette(hereafterinthissectionreferredtoasthespecifiedauthority)hasbeen
obtainedonanapplicationmadeinthisbehalf.
2. Anapplicationforpermissionundersubsection(1)shallbemadebytheemployerintheprescribedmannerstating
clearlythereasonsfortheintendedretrenchmentandacopyofsuchapplicationshallalsobeservedsimultaneously
ontheworkmenconcernedintheprescribedmanner.
3. Whereanapplicationforpermissionundersubsection(1)hasbeenmade,theappropriateGovernmentorthe
specifiedauthority,aftermakingsuchinquiryasitthinksfitandaftergivingareasonableopportunityofbeingheardto
theemployer,theworkmenconcernedandthepersonsinterestedinsuchretrenchment,may,havingregardtothe
genuinenessandadequacyofthereasonsstatedbytheemployer,theinterestsoftheworkmenandallotherrelevant
factors,byorderandforreasonstoberecordedinwriting,grantorrefusetograntsuchpermissionandacopyofsuch
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ordershallbecommunicatedtotheemployerandtheworkmen.
4. Whereanapplicationforpermissionhasbeenmadeundersubsection(1)andtheappropriateGovernmentorthe
specifiedauthoritydoesnotcommunicatetheordergrantingorrefusingtograntpermissiontotheemployerwithina
periodofsixtydaysfromthedateonwhichsuchapplicationismade,thepermissionappliedforshallbedeemedto
havebeengrantedontheexpirationofthesaidperiodofsixtydays.
5. AnorderoftheappropriateGovernmentorthespecifiedauthoritygrantingorrefusingtograntpermissionshall,
subjecttotheprovisionsofsubsection(6),befinalandbindingonallthepartiesconcernedandshallremaininforce
foroneyearfromthedateofsuchorder.
6. TheappropriateGovernmentorthespecifiedauthoritymay,eitheronitsownmotionorontheapplicationmadeby
theemployeroranyworkman,reviewitsordergrantingorrefusingtograntpermissionundersubsection(3)orrefer
thematteror,asthecasemaybe,causeittobereferred,toaTribunalforadjudication:Providedthatwherea
referencehasbeenmadetoaTribunalunderthissubsection,itshallpassanawardwithinaperiodofthirtydays
fromthedateofsuchreference.
7. Wherenoapplicationforpermissionundersubsection(1)ismade,orwherethepermissionforanyretrenchmenthas
beenrefused,suchretrenchmentshallbedeemedtobeillegalfromthedateonwhichthenoticeofretrenchmentwas
giventotheworkmanandtheworkmanshallbeentitledtoallthebenefitsunderanylawforthetimebeinginforceas
ifnonoticehadbeengiventohim.
8. Notwithstandinganythingcontainedintheforegoingprovisionsofthissection,theappropriateGovernmentmay,ifitis
satisfiedthatowingtosuchexceptionalcircumstancesasaccidentintheestablishmentordeathoftheemployeror
thelike,itisnecessarysotodo,byorder,directthattheprovisionsofsubsection(1)shallnotapplyinrelationtosuch
establishmentforsuchperiodasmaybespecifiedintheorder.
9. Wherepermissionforretrenchmenthasbeengrantedundersubsection(3)orwherepermissionforretrenchmentis
deemedtobegrantedundersubsection(4),everyworkmanwhoisemployedinthatestablishmentimmediately
beforethedateofapplicationforpermissionunderthissectionshallbeentitledtoreceive,atthetimeofretrenchment,
compensationwhichshallbeequivalenttofifteendays'averagepayforeverycompletedyearofcontinuousservice
oranypartthereofinexcessofsixmonths.

Section25H.REEMPLOYMENTOFRETRENCHEDWORKMEN
Whereanyworkmenareretrenched,andtheemployerproposestotakeintohisemploymentanypersons,heshall,insuch
mannerasmaybeprescribed,giveanopportunitytotheretrenchedworkmenwhoarecitizensofIndiatoofferthemselvesfor
reemployment,andsuchretrenchedworkmenwhoofferthemselvesforreemploymentshallhavepreferenceoverother
persons.

Section2(l)LockOut
Lockoutmeanstemporaryclosingoftheplaceofemploymentorsuspensionofworkorrefusalbytheemployertocontinueto
employanynumberofpersonsemployedbyhim.
UsedasameasureofcoercionAntithesisofstrike.
duetoatradedispute.
intentional
4ingradientsofLockout
1. Temporaryclosureofaplaceofemploymentbyemployerorsuspensionorworkbytheemployer,orrefusaltoemploy
anynumberofpersonsbytheemployer.
2. motivatebycoercion
3. inanindustry
4. duetoadisputeinsuchindustry.
WorkmenofItakhoolieTeaEstatevsManagement1952Inlockoutworkmenareaskedbytheemployertokeepaway
fromworkandthustheyarenotunderanyobligationtopresentthemselvesforwork.

Section2(q)Strike
Strikemeansacessationofworkbyabodyofpersonsemployedinanyindustryactingincombination,oraconcerted
refusal,orarefusalunderacommonunderstanding,ofanynumberofpersonswhoareorhavebeensoemployedto
continuetoworkortoacceptemployment.
IndianIronandSteelCovsItsWorkmenHeldthatmerecessationofworkisnotstrikeunlessitisshownthatitisduetoan
industrialdemand.
RamSarupvsRexMereabsencefromworkisnotenoughbutthereshouldbeaconcertedrefusaltoacceptemployment
tocallitastrike.
PatialaCementCo.vsCertainWorkersCessationofworkforevenhalfanhourcanbeastrike.

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TypesofStrikeGeneral,GoSlow,WorktoRule,Toolsdown/StayIn,Sympathetic,Hunger.
Section22.PROHIBITIONOFSTRIKESANDLOCKOUTS
1. Nopersonemployedinapublicutilityserviceshallgoonstrikeinbreachofcontract
1. withoutgivingtotheemployernoticeofstrike,ashereinafterprovided,withinsixweeksbeforestrikingor
2. withinfourteendaysofgivingsuchnoticeor
3. beforetheexpiryofthedateofstrikespecifiedinanysuchnoticeasaforesaidor
4. duringthependencyofanyconciliationproceedingsbeforeaconciliationofficerandsevendaysafterthe
conclusionofsuchproceedings.
2. Noemployercarryingononanypublicutilityserviceshalllockoutanyofhisworkmen
1. withoutgivingthemnoticeoflockoutashereinafterprovided,withinsixweeksbeforelockingoutor
2. withinfourteendaysofgivingsuchnoticeor
3. beforetheexpiryofthedateoflockoutspecifiedinanysuchnoticeasaforesaidor
4. duringthependencyofanyconciliationproceedingsbeforeaconciliationofficerandsevendaysafterthe
conclusionofsuchproceedings.
3. Thenoticeoflockoutorstrikeunderthissectionshallnotbenecessarywherethereisalreadyinexistenceastrikeor,
asthecasemaybe,lockoutinthepublicutilityservice,buttheemployershallsendintimationofsuchlockoutor
strikeonthedayonwhichitisdeclared,tosuchauthorityasmaybespecifiedbytheappropriateGovernmenteither
generallyorforaparticularareaorforaparticularclassofpublicutilityservices.
4. Thenoticeofstrikereferredtoinsubsection(1)shallbegivenbysuchnumberofpersonstosuchpersonorpersons
andinsuchmannerasmaybeprescribed.
5. Thenoticeoflockoutreferredtoinsubsection(2)shallbegiveninsuchmannerasmaybeprescribed.
6. Ifonanydayanemployerreceivesfromanypersonemployedbyhimanysuchnoticesasarereferredtoinsub
section(1)orgivestoanypersonemployedbyhimanysuchnoticesasarereferredtoinsubsection(2),heshall
withinfivedaysthereofreporttotheappropriateGovernmentortosuchauthorityasthatGovernmentmayprescribe,
thenumberofsuchnoticesreceivedorgivenonthatday.

Section25.PROHIBITIONOFFINANCIALAIDTOILLEGALSTRIKESANDLOCKOUTS
Nopersonshallknowinglyexpendorapplyanymoneyindirectfurtheranceorsupportofanyillegalstrikeorlockout.

Section26.PENALTYFORILLEGALSTRIKESANDLOCKOUTS
(1)Anyworkmanwhocommences,continuesorotherwiseactsinfurtheranceof,astrikewhichisillegalunderthisAct,shall
bepunishablewithimprisonmentforatermwhichmayextendtoonemonth,orwithfinewhichmayextendtofiftyrupees,or
withboth.
(2)Anyemployerwhocommences,continues,orotherwiseactsinfurtheranceofalockoutwhichisillegalunderthisAct,
shallbepunishablewithimprisonmentforatermwhichmayextendtoonemonth,orwithfinewhichmayextendtoone
thousandrupees,orwithboth.

Section2(j)Industry
Industrymeansanytrade,business,undertaking,manufature,orcallingofserviceofemployersandincludesanycalling,
service,employment,handicraft,industrialoccupation,oravocationorworkers.
StateofBombayvsBombayHospitalMazdoorSabhaAnyactivitysystematicallyorhabituallyundertakenforthe
productionordistributionofgoodsorfortherenderingofmaterialservicetothecommunityatlargeorapartofsuch
communitywiththehelpofemployeesisanindustry.
BangaloreWaterSuppyvsARajappaPractiallyreiteratedtheprinciplesinBombayHospitalMazdoorSabhacase.
TripleTest
1. SystematicActivity
2. organizedbyacooperationofemployerandemployees
3. fortheproductionandordistributionofgoodsorservicescalculatedtosatisfyhumanwantsandwishes.
Thefollowingpointswerealsoobserved
1. Doesnotincludespiritualorreligiousservicese.g.making,onalargescale,prasad.Itonlyincludesmaterialservices
andthings.
2. Absenceofprofitmotiveorgainfulobjectiveisirrelevantbetheventurepublic,private,orjoint.
3. Thetruefocusisonthefunctionandthedecisivetestisthenatureoftheactivitywithspecialemphasisonemployee
employerrelationship.
4. Ifanorganizationisatradeorbusiness,itdoesnotceasetobeanindustrymerelybecausephilanthropyisanimating
theundertaking.
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DominantNatureTestIfanundertakingincludesseveralactivitiessomeofwhichareindustryandsomenot,the
predominatenatureofthebusinessandtheintegrationofthedepartmentsisthetruetest.
ExceptionsCertaingurukuls,orresearchlabs,orclubsoperatingonasmallscalearenotindustry.
IntheBangaloreWaterSuppycase,BombayHospitalMazdoorSabhacasewasrehabilitatedandHospitalisconsideredan
industry.
DNBanerjeevsPNMukherjeeMunicipalCorporationisanindustry.
BrahmoSamajEducationSocietyvsWBCollegeEmployeesAssocialtionWhetheraUniversityorEducational
institutionisanindustryornotdependsontheevidenceineachcase.Iftheevidencepointsthatthereisnomuchimportance
ofindividualteachersandthefocusismainlyprofit,itisanindustry.IngeneralUniversitiesareindustryeventhoughits
workersmaynotbeWorkersasperthetheact.
ClubssuchasCricketClubofIndia,LawyersOffice,IndianStandardsInstituteareallIndustry.

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