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Unit 10: Trade Unions Act, 1926

Objectives Notes

After studying this unit, you will be able to:

l z Explain the genesis of the Act
l z Discuss the authorities under trade union
l z Get an overview of the registration of trade union

l z Describe the amalgamation, dissolution and penalties in trade union
Introduction

In the previous unit, we dealt with Payment of Bonus Act. Beside the Bombay Industrial
Relations Act, 1946, and the Maharashtra Recognition of Trade Unions and Prevention of Unfair
Labour Practices Act, 1971, Trade Unions Act, 1926 is the only legal framework for the trade
unions by conceding to workmen their right of association and organising unions. It permits
any seven persons to form their union and get it registered under the Act Registration of unions
is optional and not compulsory. The National Commission on Labour (1969) recommended
compulsory recognition of trade unions, but this recommendation is still under the consideration
of the Government. However, the (1982) amendment of the Industrial Disputes Act, 1947, makes
registration compulsory virtually by defining the term “Trade Union”, for the purposes of this
Act, as a Union registered under the Trade Unions Act, 1926. This gives Unions certain rights
and immunities which unregistered Trade Unions do not enjoy. Therefore, workers tend to be
members of registered trade unions. Besides specifying the procedure for registration of union,
this Act lays down the guidelines for the day to day working of the registered unions. The purpose
of this Unit is to enable the students to comprehend basic expressions. At the end of this unit you
should be able to understand various concepts regarding The Trade Union Act.

10.1 Genesis of the Act

Trade union is a voluntary organization of workers pertaining to a particular trade, industry or
a company and formed to promote and protect their interests and welfare by collective action.
They are the most suitable organisations for balancing and improving the relations between the
employer and the employees. They are formed not only to cater to the workers’ demand, but also
for inculcating in them the sense of discipline and responsibility.
In India, the first organised trade union was formed in 1918 and since then they have spread
in almost all the industrial centres of the country. The legislation regulating these trade unions
is the Indian Trade Unions Act, 1926. The Act deals with the registration of trade unions, their
rights, their liabilities and responsibilities as well as ensures that their funds are utilised properly.
It gives legal and corporate status to the registered trade unions. It also seeks to protect them
from civil or criminal prosecution so that they could carry on their legitimate activities for the
benefit of the working class. The Act is applicable not only to the union of workers but also to the
association of employers. It extends to whole of India. Also, certain Acts, namely, the Societies
Registration Act, 1860; the Co-operative Societies Act, 1912; and the Companies Act, 1956 shall
not apply to any registered trade union, and that the registration of any such trade union under
any such Act shall be void.
The Act is administered by the Ministry of Labour through its Industrial Relations Division.
The Division is concerned with improving the institutional framework for dispute settlement
and amending labour laws relating to industrial relations. It works in close co-ordination with
the Central Industrial Relations Machinery (CIRM) in an effort to ensure that the country gets a
stable, dignified and efficient workforce, free from exploitation and capable of generating higher
levels of output. The CIRM, which is an attached office of the Ministry of Labour, is also known

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