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Unfair Labor Practice in India: Key Cases & Rules
Disclaimer: This blog post provides general information based on notable Indian court judgments and is not intended as legal advice. Legal situations vary, and you should consult a qualified attorney for advice specific to your circumstances.
Unfair labor practices strike at the heart of fair employment relationships in India. Whether it's prolonged temporary employment without regularization, failure to follow natural justice principles, or victimization of workers, these practices are prohibited under key labor laws like the Industrial Disputes Act, 1947 (ID Act) and the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 (MRTU & PULP Act). This post breaks down what constitutes an unfair labor practice, drawing from Supreme Court and High Court rulings to help employers and employees navigate these issues.
What is Unfair Labor Practice?
In Indian labor law, unfair labor practice refers to actions by employers, workers, or trade unions that undermine industrial peace or exploit labor. Section 25T of the ID Act explicitly states: No employer or workman or a trade union... shall commit any unfair labor practice. Violations can lead to penalties under Section 25U, including imprisonment up to six months or fines. Tata Cellular VS Union Of India - 1994 Supreme(SC) 697 THE OFFICER INCHARGE DEFENCE STANDARDIZATION CELL Vs MUKESH KUMAR - 2013 Supreme(Online)(DEL) 2477
The Fifth Schedule of the ID Act lists specific unfair practices, such as:
- Employing workers on a temporary basis to avoid permanency (Clause 10).
- Failing to implement settlements or awards.
- Victimization or unfair discrimination. Officer Incharge Defence Standardization Cell VS Mukesh Kumar - 2013 Supreme(Del) 591
Similarly, the MRTU & PULP Act's Schedules IV and V detail employer and union malpractices, empowering Industrial Courts to intervene. Courts have consistently held that prolonged casual employment constitutes exploitation, entitling workers to regularization. SAVARKUNDLA MUNICIPALITY V/s ISHMAILBHAI HASAMBHAI JHANKHRA - 2024 Supreme(Online)(GUJ) 23695 THE MAVELIKKARA MUNICIPALITY, REP.BY vs NIRMALA AND ANOTHER - 2010 Supreme(Online)(KER) 21728
Common Examples from Court Rulings
1. Prolonged Temporary Employment Without Regularization
One of the most frequent unfair labor practices is keeping workers on daily wage or temporary contracts for years, denying them permanent status and benefits. Courts view this as a continuing wrong.
- In a case involving municipality fitters employed since 1995 and 1997, the tribunal found unfair labor practice due to non-regularization despite available posts. The court upheld: Prolonged employment of workers without regularization constitutes unfair labor practice, violating their rights under the Industrial Disputes Act. SAVARKUNDLA MUNICIPALITY V/s ISHMAILBHAI HASAMBHAI JHANKHRA - 2024 Supreme(Online)(GUJ) 23695
- Another ruling against a municipality noted: The refusal to regularize eligible workers due to claimed financial difficulty constitutes an unfair labor practice under the Industrial Disputes Act. Financial constraints do not justify casual hiring over regularization. THE MAVELIKKARA MUNICIPALITY, REP.BY vs NIRMALA AND ANOTHER - 2010 Supreme(Online)(KER) 21728
- Temporary security guards' regularization claims failed only because they lacked qualifications, but the court confirmed no unfair practice where evidence showed temporary hiring was genuine. All Indian Ex-Servicemen Employees Union (Regn. No. 2972/CNI) VS Presiding Officer Central Government Industrial Tribunal cum Labour Court - 2016 Supreme(Mad) 2550
Key Takeaway: If work is perennial and posts exist, extended temporary engagement (e.g., over 240 days/year for 12 years) typically amounts to unfair practice, justifying permanency orders. Bank Of India Through Its Constituted Power Of Attorney Holder-cum-special manager, Rblock Birchand Patel Marg, Patna VS State Of Bihar - 2010 Supreme(Pat) 2630
2. Victimization, Dismissal, and Domestic Enquiries
Dismissals without fair enquiry or motivated by bias often qualify as victimization.
- Tribunals must check for want of good faith, victimization or unfair labour practice before upholding dismissals. Mere misconduct findings aren't enough if bias is evident. Punjab National Bank LTD. VS All India Punjab National Bank Employees Federation - 1959 Supreme(SC) 166
- In a dismissal case, the tribunal held the domestic enquiry unfair, finding victimization and unfair labour practice due to improper procedure. KARNATAKA STATE ROAD TRANSPORT CORPORATION vs GANGANNA - 2023 Supreme(Online)(Kar) 33849
- However, compassionate appointments don't override qualification rules; denying a job for unmet criteria isn't unfair practice. Divisional Controller, M. S. R. T. Corporation VS Rafiuddin Sk. Habib - 2000 Supreme(Bom) 505
Industrial Tribunals can imply contract terms for suspension pending dismissal approval under Section 33 ID Act, but only to prevent unfairness to employers. This power ensures industrial peace without endorsing victimization. Management Hotel Imperial, New Delhi VS Hotel Workers Union - 1959 Supreme(SC) 132
3. Violations of Natural Justice in Tender and Service Matters
Even in commercial contexts like telecom tenders, principles of natural justice apply.
- In the landmark Tata Cellular case, the Department of Telecommunications cancelled a provisional selection without hearing the bidder, violating natural justice: Before doing so... ought to have been heard - Therefore there is a clear violation of the principle of natural justice. The Supreme Court quashed the FIR under CrPC Section 482, noting no evidence of wrongdoing. Tata Cellular VS Union Of India - 1994 Supreme(SC) 697
Public servants' disciplinary enquiries must follow natural justice, with evolving statutory protections. Post-1991 rulings mandate supplying enquiry reports before penalties, applied prospectively to avoid administrative burden. Managing Director, Ecil, Hyderabad VS B. Karunakar - 1993 Supreme(SC) 906
4. Non-Implementation of Settlements and Awards
Failing to honor settlements or awards is a classic unfair practice.
- A school management's refusal to implement a wage settlement led to a finding of unfair practice: The court found that the management engaged in unfair labor practice by not implementing the settlement. MAHARASHTRA GIRLS' EDUCATION SOCIETY VS PRESIDENT, MAHARASHTRA KARAMCHARI SANGHATANA - 1999 Supreme(Bom) 1003
- Similarly, non-implementation of a reinstatement award post-company closure warranted molded relief: 50% back-wages plus compensation. Courts under MRTU & PULP Section 30(1) have discretion to adapt remedies. Abdulla R. Khan VS Construction and Engineering Equipments - 2023 Supreme(Bom) 593
5. Strikes, Recruitment, and Interim Relief
Recruiting during illegal strikes can be unfair, even if the strike violates notice rules.
- A bank's hiring during a strike was deemed unfair under MRTU & PULP, despite the strike's illegality under BIR Act. Ambure P. A. VS Vyapari Sahakari Bank Maryadit, Chattigalli, Solapur - 2014 Supreme(Bom) 1257
- Interim relief requires a prima facie finding of unfair practice; courts lose power if none is established. Maharashtra State Road Transport Corporation VS M. S. R. T. Kamgar Sanghatana - 1999 Supreme(Bom) 1051 Anthea Aromatics P. Ltd. VS Association of Chemical Workers - 2005 Supreme(Bom) 356
Role of Government Companies and 'State' under Article 12
Government companies are 'State' under Constitution Article 12, attracting natural justice and Article 14 equality. Unfair contract terms (e.g., unconscionable employment clauses) are void. Unfair practices in such entities demand stricter scrutiny. Central Inland Water Transport Corporation LTD. VS Brojo Nath Ganguly: Tarun Kanti Sengupta - 1986 Supreme(SC) 115
Remedies and Tribunal Powers
- Industrial Tribunals/Labour Courts: Can order regularization, reinstatement, back-wages, or 'cease and desist'. They imply terms for fairness and mold relief (e.g., compensation on closure). Management Hotel Imperial, New Delhi VS Hotel Workers Union - 1959 Supreme(SC) 132 Brihan Mumbai Electric Supply & Transport Undertaking (BEST) through its General Manager VS Best Jagrut Kamgar Sanghatana, through its General Secretary C/o. Parivartan Mumbai Ram Niwas - 2023 Supreme(Bom) 624
- Limitation: Continuing wrongs (e.g., benefit denial) allow relief beyond 90 days, often limited to 3 years' arrears. Brihan Mumbai Electric Supply & Transport Undertaking (BEST) through its General Manager VS Best Jagrut Kamgar Sanghatana, through its General Secretary C/o. Parivartan Mumbai Ram Niwas - 2023 Supreme(Bom) 624
- No Res Judicata: Findings under ID Act Section 33(2)(b) (approval of dismissal) don't bind Section 10 references. GENERAL ELECTRIC CO OF INDIA LTD VS FIFTH INDUSTRIAL TRIBUNAL OF WEST BENGAL - 1985 Supreme(Cal) 210
Key Takeaways for Employers and Workers
- Employers: Document genuine temporary needs, follow fair enquiries, implement awards promptly. Avoid prolonged casual hiring for perennial work.
- Workers/Unions: Raise disputes via proper channels (not writs alone); prove victimization with evidence. MINERVA MILLS (N. T. C. ) LABOUR UNION, BANGALORE VS MANAGEMENT OF MINERVA MILLS LIMITED, BANGALORE - 1991 Supreme(Kar) 506
- Trainee Status: Mere designation doesn't exempt 'workman' classification; actual duties matter. Raj Kumar Rastogi vs Delhi Press Ltd. - 2026 Supreme(Del) 236
In summary, Indian courts vigilantly curb unfair labor practices to foster equity. Rulings emphasize natural justice, non-exploitation, and industrial harmony. While specifics vary by facts, these precedents guide fair dealings.
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Search Results for "Unfair Labor Practice in India: Key Cases & Rules"
1994 0 Supreme(SC) 697 • India - Supreme Court
M. N. VENKATACHALIAH, S. MOHAN, M. M. PUNCHHI
Criminal Procedure Code - Section 482 - Quashing the FIR – Employment and Service - No evidence or comes ... State need not enter into any contract with anyone, but if it does so, it must do so fairly without discrimination and without unfair ... National Labor Relations Board Justice Frankfurter stated : "A formula for judicial review of administrative ... In practice the test of 'reasonable suspicion' and 'real likelihood' of bias will generally lead to the same result.
1993 0 Supreme(SC) 906 • India - Supreme Court
B. P. JEEVAN REDDY, K. RAMASWAMY, M. N. VENKATACHALIAH, P. B. SAWANT, S. MOHAN
Servants (Inquiries) Act, 1850 - Section 25 - Civil Services (Classification, Control and Appeal) Rules – Rule 55 - Delinquent employee ... imputations of misbehviour against public servant - Either Government, if it thought fit conducted prosecution or left it to accuser to conduct ... – Court may first refer to statutory development of law - It is not necessary to refer to law prior to Public Servants (Inquiries ... The Court also referred to the decisions subsequent to Sunburst and to the "Practice S....
1995 0 Supreme(SC) 1078 • India - Supreme Court
B.L.HANSARIA, B.P.JEEVAN REDDY, K.RAMASWAMY
or taking recourse to unfair labor practice - In this background court do not think if court would be justified in giving much weight ... labor practice or victimization by management - Even so power Section - Available to be exercised even if there be no victimization ... court industrial tribunal - It may be that this power was conferred on these adjudicating authorities because of prevalence of unfair ... It may be that this power was conferred on these adjudicating authorities bec....
1986 0 Supreme(SC) 115 • India - Supreme Court
D.P.MADAN, A.P.SEN
INTERPRETATION OF EXPRESSION “THE STATE”—EXPRESSION IS USED IN CONCEPT OF STATE IN RELATION TO FUNDAMENTAL RIGHTS Guaranteed BY PART ... of Man and of the Citizen" proclaimed these rights in lofty words and that Revolutionary France had translated them into practice ... A term in a contract of employment entered into by a private employer which is unfair, unreasonable and unconscionable is bad in ... Practices which were considered perfectly normal at one time have today become obnoxio....
2006 5 Supreme 662 • India - Supreme Court
B.P.SINGH, S.B.SINHA
[See The Law and Practice of Arbitration and Conciliation by O.P. Malhotra, Second edition, page 1174.] ... Award could also be set aside if it is so unfair and unreasonable that it shocks the conscience of the court. ... The public policy violation, indisputably, should be so unfair and unreasonable as to shock the conscience of the court.
1999 0 Supreme(Bom) 1051 • India - Bombay
D.K.DESHMUKH
Once the court reaches a finding of no unfair labor practice, it loses the power to grant any interim relief. ... Once the court reaches a finding of no unfair labor practice, it loses the power to grant any interim relief. ... Interim Relief - Industrial Court - The court held that once the court reaches a finding that there is no unfair labor practice ... The learned Counsel for the petitioners submits that in view of the finding ....
1999 0 Supreme(Bom) 1003 • India - Bombay
R.J.KOCHAR, A.V.SAVANT
Issues: Dispute over the implementation of the settlement, alleged ambiguity in the settlement, and unfair labor practice ... Industrial Disputes Act - Settlement Implementation - The court found that the management engaged in unfair labor practice by ... The Industrial Court declared that the Management engaged in unfair labor practice by not implementing the settlement and directed ... desist from engaging in suc....
2010 0 Supreme(Pat) 2630 • India - Patna
V.N.SINHA
It also considered the power of the Industrial Tribunal to order permanency of workers who have been victims of unfair labor practice ... labor practice for over twelve years, justifying his regularization. ... Issues: Regularization of employment, compliance with constitutional mandates, regularity of service for regularization, unfair ... referred to it the Tribunal has directed for his regularization relieving Respondent No. 2 of the unfair labour....
2024 Supreme(Online)(GUJ) 23695 • India - High Court of Gujarat
A.S. SUPEHIA, GITA GOPI, JJ
labor practice, violating their rights to permanent employment. ... labor practice. ... labor practice, thus entitling the workmen to regularization. ... unfair labour practice.” ... Unfair labour practice is exploitation of workmen. ... Act, which prohibits the employers resorting to unfair labour practice.
2000 0 Supreme(Bom) 505 • India - Bombay
R.J.KOCHAR
Road Transport Corporations Act - Unfair Labour Practice - M.R.T.U. and P.U.L.P. ... The Industrial Court found the Corporation guilty of unfair labor practice for not employing the son, relying on circulars related ... Finding of the Court: The court held that the Corporation's engagement in unfair labor practice was unfounded, as the ... Act, 1971 praying for a declaration that the present petitioner had engaged in an unfair labou....
• India - High Court of Karnataka
Schedule V of the Act indeed lists unfair labor practices. Section 25T prohibits any employer, workers, or Trade Union from committing any unfair labor practice. ... The first respondent does not even specify as to which of the Clauses of the unfair labor practice is violated. ... In the present case, the order does not even specify as to which of the clauses of the unfair labor practice is ....
2023 Supreme(Online)(Kar) 33849 • India - Karnataka High Court
labor practice or victimization of the workmen. ... The Tribunal holds that the domestic enquiry was not fair and proper and that the workman was subjected to victimization and unfair labour practice. ... labour practice adopted by the Corporation. ... the impugned order of dismissal and the Tribunal by its order dated 22.07.2017 having held that the domestic enquiry conducted by the Corporation is not fair and proper, was justified in holding that there was victimization and unfair l....
1985 0 Supreme(Cal) 210 • India - Calcutta
UMESH C.BANERJEE
Since the action is punitive, namely, dismissal or discharge for misconduct, the Tribunal has to oversee the action to guarantee that no unfair labor practice or victimization has been practiced there by. ... In the said order the 7th Industrial also held that the petitioner had come to a bona fide conclusion and the respondent No. 3 was guilty of the charges leveled against him an the dismissal of the respondent No 3 did not amount to unfair labor practice. ... Tribunal is made out; (....
2023 0 Supreme(Bom) 624 • India - Bombay
N. J. JAMADAR
Naidu that in fact there was no unfair labour practice. ... Two, even if it is held that the unfair labour practice was a continuing one, could the final relief be restricted to a particular period or, for that matter, to the period of limitation prescribed for filing a complaint of unfair labour practice. ... The said modus operandi was stated to be in violation of the standing orders and, thus, constituted an unfair labour practice. ... Therefore, ....
2026 0 Supreme(Del) 236 • India - IN THE HIGH COURT OF DELHI AT NEW DELHI
SUBRAMONIUM PRASAD, VIMAL KUMAR YADAV
(v) Learned Counsel for the Appellant further states that the interpretative exercise undertaken by the Labor Court as well as the learned Single Judge violates the prohibition of unfair labor practice. ... On the facts and evidence brought on record, the conclusion was inescapable that the appellant employer resorted to unfair labour practice. ... The Appellant sent a Demand Notice dated 02.07.1986 along with a copy of the Medical Certificate dated 17.06.1986, stating that the action ....
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