Section 19 of IDA : Section 19: Period Of Operation Of Settlements And Awards

Explanation using Example

Imagine a scenario where the workers of ABC Manufacturing Company have been in dispute with the management over wage increases. After several rounds of negotiations, they reach a settlement on March 1st, 2023. The settlement includes a clause stating that it will come into effect immediately. This situation reflects the application of Section 19(1) of The Industrial Disputes Act, 1947, where the settlement becomes operational on the date it is signed since the parties agreed on that date.

The settlement also states that it will be binding for a period of one year, which means that both the workers and the management must adhere to the terms until March 1st, 2024. This is in accordance with Section 19(2), where the duration of the settlement's binding nature is as agreed by the parties. If no period was agreed upon, it would have been binding for six months.

However, by December 2023, the economic conditions have significantly changed, leading the management to believe that the terms of the settlement are no longer viable. They approach the appropriate government to have the settlement re-evaluated, as per Section 19(4). The government refers the settlement to a Labour Court, which decides whether the period of operation should be shortened due to the material change in circumstances.

Finally, if either the workers or the management want to terminate the settlement after the one-year binding period, they must represent the majority and give a two-month notice to the other party, as mandated by Section 19(7).