#Chapter 3: The Industrial Relations Code, 2020

CHAPTER III: TRADE UNIONS

Section 5: Registrar of Trade Unions

This section deals with the government officials responsible for managing and regulating Trade Unions.

Sub-Section (1): Appointment of Registrars

Legal Text: The State Government appoints a Registrar of Trade Unions, and may also appoint Additional, Joint, and Deputy Registrars. These officers exercise the powers and duties specified by the State Government.
Simple English: The State Government is in charge of creating the official office that registers and monitors all Trade Unions within its state. They name a main Registrar and can appoint other officials to assist them with specific duties or areas.
Example: The State Government of Maharashtra appoints Mr. Vijay Patil as the Registrar of Trade Unions for the entire state, and appoints a Deputy Registrar in Pune to handle all local registration applications.

Sub-Section (2): Jurisdiction of Assistant Registrars

Legal Text: If an Additional, Joint, or Deputy Registrar is performing the duties of the Registrar in the area where a Trade Union’s registered office is located, that officer is legally considered the Registrar for that specific Trade Union.
Simple English: If the main Registrar delegates the job for a certain region or union to a Deputy Registrar, the Deputy Registrar’s actions for that union have the same legal standing as the main Registrar’s.
Example: The Tata Steel Workers Union has its registered office in Jamshedpur, which falls under the jurisdiction of the Deputy Registrar. The Deputy Registrar processes the Union’s annual filing. This action is legally binding, even though it wasn’t done by the main State Registrar.

Section 6: Criteria for registration

This section lays out the basic rules for how a group of workers can formally register their Trade Union with the government.

Sub-Section (1): The Minimum Requirement

Legal Text: “Any seven or more members of a Trade Union may… apply for registration of the Trade Union under this Code.”
Simple English: To start the registration process, you need a minimum of seven people to sign the Union’s rules and submit the application.
Example: A group of 15 warehouse workers decides to form a union. At least 7 of them must sign the necessary papers to submit the application to the Registrar.

Sub-Section (2): Membership Threshold (The Real Requirement)

Legal Text: “No Trade Union of workers shall be registered unless at least ten per cent. of the workers or one hundred workers, whichever is less, engaged or employed in the industrial establishment or industry… are the members of such Trade Union on the date of making of application for registration.”
Simple English: For a workers’ union to be legally registered, it must prove that on the day it applies, its membership includes either:
- At least $10\%$ of all workers in that company/industry, OR
- 100 workers,
  Whichever number is smaller.
Example:
- Scenario A (Small Company): A factory has 500 workers. $10\%$ is 50. Since 50 is less than 100, the union only needs 50 members to apply.
- Scenario B (Large Company): A company has 5,000 workers. $10\%$ is 500. Since 100 is less than 500, the union only needs 100 members to apply.

Sub-Section (3): Dropping Members During Application Process

Legal Text: If some of the initial applicants quit or withdraw their names after the application is submitted but before the union is registered, the application will not be invalid, provided the number of people who left is not more than half of the total number of people who initially applied.
Simple English: The registration process takes time. If some founding members change their minds and leave, the process can continue, as long as the number of defectors is less than half of the original group who signed up.
Example: 120 workers initially applied for registration. If 50 workers withdraw their names during the 3-month waiting period, the application remains valid because 50 is less than half of 120 (which is 60).

Sub-Section (4): Minimum Membership After Registration

Legal Text: A registered Trade Union must at all times maintain a membership of at least $10\%$ of the workers or 100 workers, whichever is less, subject to a minimum of seven members.
Simple English: Once registered, a union cannot let its membership drop too low. It must continuously meet the same $10\%$ or 100 worker threshold (whichever is less), and in any case, it must never drop below 7 members.
Example: A registered union in a factory with 600 workers needs to maintain a minimum of 60 members ($10\%$ of 600). If its membership drops to 59, the union is in violation of the rule and could face cancellation.

Section 7: Provisions to be contained in constitution or rules of Trade Union

To be registered, a Trade Union’s rulebook (or constitution) must cover certain mandatory points to ensure it operates legally and transparently.

Legal Text: A Trade Union must provide for the following matters in its rules…
Simple English: Your union’s rulebook needs to be a comprehensive document covering these specific 12 points.

(a) The name of the Trade Union

Example: “The All-India Software Developers Federation” or “Pune Automobile Workers Union, Local 42.”

(b) The whole of the objects for which the Trade Union has been established

Example: The rules must state: “The object of this union is to negotiate wages, ensure safety standards, and provide legal aid to members.”

(c) The whole of the purposes for which the general funds of the Trade Union shall be applicable

Simple English: The rules must specify exactly what the general membership fees and money can be spent on (and it must be a legal use).
Example: The rules can state: “General funds shall be used for rent, administrative expenses, printing newsletters, and legal defense in industrial disputes.” They cannot be used for illegal activities.

(d) The maintenance of a list of members of the Trade Union and adequate facilities for the inspection thereof

Simple English: The union must keep an up-to-date list of all its members, and the union leaders and members must have reasonable access to check this list.
Example: The rulebook must state: “The membership list shall be updated monthly and be available for inspection by any office-bearer or member upon request to the Secretary during normal working hours.”

(e) The admission of ordinary members… and also the admission of such number of honorary or temporary members

Simple English: The rules must define who can join the union. The primary members must be actual workers in the connected industry. It can also allow a limited number of “honorary” or “temporary” members (who are not workers) as long as they aren’t elected as office-bearers (due to the restriction in Section 21).
Example: The union rules state that “Any employee of the XYZ company is eligible for ordinary membership.” It also allows a retired labor lawyer to be an honorary member, provided they do not hold an executive position.

(f) The payment of a subscription by members of the Trade Union

Simple English: The rules must state how much each member has to pay as a membership fee.
Example: The rulebook specifies: “Every member shall pay a monthly subscription fee of Rs. 100.”

(g) The conditions under which any member shall be entitled to any benefit… and under which any fine or forfeiture may be imposed

Simple English: The rules must clearly explain what benefits a member gets (like a death benefit or access to a legal aid fund) and under what circumstances the union can fine a member or revoke their rights.
Example: The rules state: “Members are entitled to a Rs. 5,000 marriage benefit after 2 years of continuous membership. A member may be fined up to Rs. 500 for deliberately disrupting a general body meeting.”

(h) The annual general body meeting… including the election of office-bearers

Simple English: The union must plan for an annual meeting of all members to discuss business, including holding elections for its leaders (office-bearers).
Example: The rules mandate: “A General Body Meeting shall be held every November to review the past year’s accounts and elect new office-bearers.”

(i) The manner in which the members of the executive and the other office-bearers… shall be elected once in a period of every three years and removed

Simple English: The rules must describe the exact process for electing, removing, and filling unexpected vacancies for all union leaders, and these elections must happen at least once every three years.
Example: The rulebook details a secret ballot voting process for the election of the President, Vice-President, and Treasurer every third year, and specifies a process for a vote of no-confidence if removal is needed.

(j) The safe custody of the funds… an annual audit… and adequate facilities for the inspection of the account books

Simple English: The union must define how its money is kept safe, ensure the accounts are checked by an auditor every year, and allow the leaders and members to inspect the financial records.
Example: The rules state: “All funds shall be kept in a dedicated savings account. A chartered accountant shall audit the accounts annually, and the audited report will be available for member inspection one week prior to the annual general meeting.”

(k) The manner in which the rules shall be amended, varied or rescinded

Simple English: The rules must describe the process for changing (amending) or cancelling the rules themselves.
Example: The rule specifies: “Any change to the union rules requires a two-thirds majority vote of the members present at a specially convened meeting, following 30 days’ notice.”

(l) The manner in which the Trade Union may be dissolved

Simple English: The rules must detail the procedure for permanently shutting down the union.
Example: The rule states: “The union may only be dissolved upon the consent of at least $75\%$ of the total members, followed by a formal notification to the Registrar.”

Section 8: Application for registration, alteration of name and procedure thereof

This covers the actual documentation needed for registration and the Registrar’s duty to check the details.

Sub-Section (1): Documents to Submit

Legal Text: The application must be made electronically or otherwise and must include four specific items.
Simple English: You need to send the application to the Registrar (digitally or physically) along with the following four mandatory documents:

(a) A declaration to be made by an affidavit

Simple English: A sworn, notarized statement confirming the information given is true and correct.
Example: The union leaders submit a signed affidavit stating that all 120 founding members are genuine workers and have paid their initial subscription fee.

(b) Copy of the rules of the Trade Union together with a copy of the resolution

Simple English: A copy of the union’s full rulebook, plus the official document proving the members voted to adopt those rules.
Example: The union submits its 10-page rulebook and the minutes of the meeting showing the $98\%$ vote in favor of adopting those rules.

(c) A copy of the resolution adopted by the members authorising the applicants to make an application for registration

Simple English: The official document showing the members voted to authorize the specific people (like the President and Secretary) to file the registration application on the union’s behalf.
Example: The union submits a signed document that says, “Resolved: The Executive Body is hereby authorized to file the application for registration with the State Registrar.”

(d) (For federations/central organisations only) A copy of the resolution adopted by the members of each of the member Trade Unions… agreeing to constitute a federation or a central organisation of Trade Unions

Simple English: If you’re registering a larger union formed by several smaller unions (a federation), you need proof that every single one of those smaller unions agreed to join the federation.
Example: Three separate local factory unions are forming a state-level Federation. The Federation must submit three separate resolutions, one from each local union, showing their members approved the plan to merge into the Federation.

Sub-Section (2): Extra Requirement for Existing Unions

Legal Text: If a Trade Union has existed for more than one year before applying for registration, it must include a general statement of its assets and liabilities (a balance sheet).
Simple English: If the group applying for registration has already been operating as an informal union for over a year, they must submit their financial records to show their current standing.
Example: An informal workers’ collective has been operating for 18 months. When they apply for formal registration, they must provide a statement showing how much cash they have (assets) and how much they owe (liabilities).

Sub-Section (3): Registrar’s Power to Request Information

Legal Text: The Registrar can ask for more information if they need to be satisfied that the application follows the Code’s rules, and they can refuse to register the union until that information is provided.
Simple English: If the Registrar finds any detail missing or unclear, they can ask the union to provide the missing documents or clarification. Until the union complies, the application process is on hold.
Example: The Registrar notices the submitted list of members is incomplete. They send a notice to the union, asking for the full list. The Registrar will not process the registration until the complete list is submitted.

Sub-Section (4): Name Check and Refusal

Legal Text: If the proposed union name is identical to a registered union, or so similar that it’s likely to confuse the public or members of either union, the Registrar must demand that the applicants change the name and must refuse registration until the name is changed.
Simple English: Your union’s name must be unique. The Registrar will block your registration if your chosen name is a duplicate or too confusingly similar to an existing one.
Example: A registered union is named “Alpha Tech Workers Association.” A new union applies to register as “Alpha Tech Workers Collective.” The Registrar, seeing the potential confusion, demands the new union choose a completely different name, like “Innovate Tech Union.”

Section 9: Registration of Trade Union and cancellation thereof

This section covers the actual granting of the registration certificate and the circumstances under which the government can later take it away (cancellation).

Sub-Section (1): The Act of Registration

Legal Text: Once the Registrar is satisfied that all requirements are met, they shall register the Trade Union by entering its details into a maintained register.
Simple English: If the union has done everything correctly and satisfied the Registrar, the Registrar must legally accept the union and record its official details.
Example: After verifying the membership list and rules, the Registrar officially records the union’s name, address, and officer details in the state’s register of Trade Unions.

Sub-Section (2): The Certificate

Legal Text: The Registrar must issue a certificate of registration to the applicant, and this certificate is conclusive evidence that the Trade Union has been registered under this Code.
Simple English: The union gets an official certificate, which is the final, undeniable proof in any legal setting that the union is legitimate and registered under the law.
Example: When the union enters into negotiations with the employer, the certificate of registration is the legal document they show to prove they are a recognized entity under the Code.

Sub-Section (3): Maintaining Records

Legal Text: After issuing the certificate, the Registrar must formally enter the union’s name and particulars into a maintained register.
Simple English: This is a record-keeping duty for the government: the Registrar must maintain a searchable, official list of all registered Trade Unions.
Example: The Registrar’s office uploads the new union’s name, registration number, and address to the State’s online database of registered Trade Unions.

Sub-Section (4): Automatic Registration for Existing Unions

Legal Text: Any Trade Union that was validly registered under the previous law (Trade Unions Act, 1926) is automatically considered registered under this new Code.
Proviso (Update Requirement): However, these existing unions must file a statement with the Registrar that their executive body (leadership) and rules comply with the new requirements of Section 7, and the Registrar will update their records accordingly.
Simple English: Old unions don’t have to register from scratch; they are automatically grandfathered in. But they still need to update their rules and organization to match the new 2020 Code and submit proof of the changes.
Example: The ‘Steel Workers Union’ was registered in 1995. They don’t re-apply, but they must send a document proving they’ve changed their election rules to meet the new 3-year term limit (as required by Section 7) and a statement that their leadership structure is compliant.

Sub-Section (5): Grounds for Cancellation

Legal Text: The Registrar can withdraw or cancel the registration certificate on three grounds:

(i) On the application of the Trade Union

Simple English: The union voluntarily asks for its own cancellation.
Example: After two unions merge, the dissolved union applies to the Registrar to formally cancel its redundant registration.

(ii) On the information received by him regarding the contravention by the Trade Union of the provisions of this Code or the rules made thereunder or its constitution or rules

Simple English: The union has broken the rules of the Code (the law), the rules made by the government under the Code, or its own internal constitution/rules.
Example: The union’s rules state they must hold an annual audit, but the Registrar discovers they haven’t held one in four years. This violation is grounds for cancellation.

(iii) If he is satisfied that the members in a Trade Union falls below ten per cent. of total workers or one hundred workers, whichever is less

Simple English: If the union fails to maintain the minimum membership required for registration (as established in Section 6(4)).
Example: In a company of 500 people, the union needs 50 members. The Registrar finds that the membership list has dropped to 45. This failure to meet the minimum threshold is grounds for cancellation.
Proviso (Prior Notice): The Registrar must give the union at least sixty days’ written notice (explaining the reasons) before cancelling the registration, unless the union itself applied for the cancellation.
Example: The Registrar, having found a violation, sends a notice on March 1st stating the union’s certificate will be cancelled on May 1st, giving them two months to address the problem or prepare for appeal.

Sub-Section (6): Tribunal-Ordered Cancellation

Legal Text: The Registrar shall cancel a union’s certificate if a Tribunal orders it.
Simple English: If a judicial body (the Tribunal) issues a binding order to cancel the registration (perhaps after resolving a trade union dispute), the Registrar has no choice but to follow that order immediately.
Example: A Tribunal decides that the union’s election process was fraudulent and orders the registration cancelled. The Registrar must carry out this cancellation.

Sub-Section (7): Communication of Reasons

Legal Text: When cancelling a certificate, the Registrar shall record the reasons for doing so and communicate the same in writing to the Trade Union concerned.
Simple English: The Registrar must formally write down why the union was cancelled and send this explanation to the union.
Example: The Registrar sends a letter to the union stating, “The certificate is cancelled because the union failed to comply with the membership threshold requirement under Section 9(5)(iii), as communicated in our notice dated May 1st.”

Section 10: Appeal against non-registration or cancellation of registration

This section provides the legal pathway for a union to challenge the Registrar’s decision if their application is rejected or their certificate is cancelled.

Sub-Section (1): Right to Appeal

Legal Text: Any person aggrieved by the Registrar’s refusal to grant registration (under Section 9) or cancellation of a certificate (under Section 9(5)) may prefer an appeal to the Tribunal within the prescribed period.
Simple English: If the Registrar says “no” to registration or cancels the certificate, the union has the right to appeal this decision to the Tribunal (the judicial body established by the Code).
Example: A union whose registration was refused believes the Registrar misunderstood their application. They file an appeal with the Tribunal to contest the refusal.
Proviso (Condontion of Delay): The Tribunal can still hear an appeal even if the deadline is missed, provided the appellant satisfies the Tribunal that the delay was due to a sufficient reason or unavoidable circumstances.
Simple English: If you miss the appeal deadline, you can ask the Tribunal to forgive the delay, but you need a very good reason (e.g., severe illness, natural disaster) to prove the delay was unavoidable.
Example: The union missed the 60-day appeal deadline because their President, who was handling the case, was hospitalized after an accident. They can submit medical records to the Tribunal, asking it to accept the late appeal.

Sub-Section (2): Tribunal’s Powers on Appeal

Legal Text: The Tribunal must give all parties a chance to be heard, and may then either dismiss the appeal, direct the Registrar to register the union (and issue a certificate), or set aside the order of cancellation, sending a copy of the order to the Registrar.
Simple English: After reviewing the case from both sides (the union and the Registrar), the Tribunal has three options: uphold the Registrar’s decision, order the Registrar to accept the union, or reverse the cancellation.
Example: The Tribunal, after hearing arguments, rules that the Registrar was wrong about the membership count and orders the Registrar to immediately issue a certificate of registration to the union. The Registrar must comply.

Section 11: Communication to Trade Union and change in its registration particulars

This section outlines the basic communication and administrative duties between the Registrar and the registered Trade Union.

Sub-Section (1): Official Address for Communication

Legal Text: “All communications and notices to a registered Trade Union shall be sent… to the address of the head office of the Trade Union as entered in the register maintained by the Registrar.”
Simple English: The government will only use the official address of the union’s head office, as recorded by the Registrar, for all official mail and notices.
Example: The Registrar needs to send a notice about a compliance review. They must mail it to the union’s officially registered head office address, not to the personal address of the President.

Sub-Section (2): Mandatory Reporting of Membership Drop

Legal Text: “The Trade Union shall inform the Registrar if the members of such Trade Union falls below ten per cent. of total workers or one hundred workers, whichever is less.”
Simple English: If the union’s membership falls below the minimum required number for registration (the $10\%$ or 100 workers threshold), the union leaders must proactively inform the Registrar themselves.
Example: The “Metalworkers Union” in a large industrial estate finds its membership has dipped below 100 members. Its Secretary is legally required to notify the Registrar immediately of this change.

Sub-Section (3): Reporting Changes in Particulars or Rules

Legal Text: “The Trade Union shall inform the Registrar of any change in the particulars given by it in its application for registration and in its constitution or rules, in such manner as may be prescribed.”
Simple English: The union must tell the Registrar about any changes to its core information (like its address, officer names) or any amendments made to its rulebook.
Example: The union holds a special meeting and votes to change its annual subscription fee. It must send the Registrar a copy of the amended rule within the prescribed time limit.

Section 12: Incorporation of a registered Trade Union

This section grants a registered Trade Union the status of a separate legal entity, similar to a company.

Legal Text: “Every registered Trade Union shall be a body corporate by the name under which it is registered, and shall have perpetual succession and a common seal with power to acquire and hold both movable and immovable property and to contract, and shall by the said name sue and be sued.”
Simple English: Once registered, the union becomes its own legal “person.” This means:
- Body Corporate: It is separate from its individual members and leaders.
- Perpetual Succession: It can continue to exist indefinitely, regardless of who joins or leaves, or if a leader dies.
- Hold Property and Contract: It can own assets (like bank accounts or a meeting hall) and enter into legal agreements (like signing a lease).
- Sue and be Sued: It can take legal action, and be taken to legal action, in its own name.
Example: The “Transport Workers Union” is registered. It uses its official name to purchase a new office building (acquiring immovable property). If it fails to pay a bill, the creditor must sue the Union (the body corporate), not the Union President personally.

Section 13: Certain Acts not to apply to registered Trade Unions

This section specifies that certain other laws governing organizations will not apply to a registered Trade Union, simplifying its compliance.

Legal Text: The provisions of the Societies Registration Act, 1860; the Co-operative Societies Act, 1912; the Companies Act, 2013, and other corresponding laws shall not apply to any registered Trade Union, and any prior registration under those Acts shall be void.
Simple English: A registered Trade Union does not have to follow the rules for non-profit societies, co-operative societies, or private companies. Its legal status is defined only by this Industrial Relations Code.
Example: The Union Treasurer does not have to worry about filing the extensive compliance documents required by the Companies Act, 2013, because that law does not apply to a Trade Union. If they had mistakenly registered as a society earlier, that society registration becomes invalid upon its Trade Union registration under this Code.

Section 14: Recognition of negotiating union or negotiating council

This is one of the most significant sections of the Code, establishing a clear, legally-backed structure for collective bargaining power, based on the principle of majority support.

Sub-Section (1): The Forum for Negotiation

Legal Text: Every industrial establishment with a registered Trade Union must have a negotiating union or a negotiating council (as the case may be) for negotiating with the employer on prescribed matters.
Simple English: The law mandates a formal body to speak for the workers in talks with the employer. This body will be either one strong union (negotiating union) or a group of unions (negotiating council).
Example: A company cannot refuse to talk to its workers’ representative body. The established negotiating union/council must be used as the single point of contact for wage negotiations or policy changes.

Sub-Section (2): Sole Negotiating Union (The One-Union Rule)

Legal Text: If there is only one registered Trade Union functioning in an industrial establishment, the employer shall recognize it as the sole negotiating union, subject to prescribed criteria.
Simple English: If only one union exists in a company, management has to deal with it as the only bargaining agent for the workers.
Example: In a small software company, the “Software Employees Union” is the only registered union. Management must automatically recognize this union as the sole body to negotiate employment terms.

Sub-Section (3): Sole Negotiating Union (The Majority Rule)

Legal Text: If there is more than one registered Trade Union, the one having the support of fifty-one per cent. or more of the workers on the muster roll (verified in a prescribed manner) shall be recognized as the sole negotiating union.
Simple English: If multiple unions exist, the one that proves it has the support of a decisive majority (at least $51\%$) of the total workforce gets the exclusive right to negotiate.
Example: In a factory of 1,000 workers, Union A has 515 members ($51.5\%$) and Union B has 300. Union A will be recognized as the sole negotiating union, and Union B will be left out of the formal negotiation process.

Sub-Section (4): The Negotiating Council (No Clear Majority)

Legal Text: If no single union achieves the $51\%$ threshold, the employer must constitute a negotiating council. This council will include representatives from any registered union that has the support of not less than twenty per cent. ($20\%$) of the total workers. The representation is one representative for each twenty per cent. of support.
Simple English: If no union wins the $51\%$ majority, bargaining power is shared. All unions with at least $20\%$ support join a multi-union “Negotiating Council.” For every $20\%$ of support a union has, it gets one seat on the council.
Example: A company has 1,000 workers. Union A has $40\%$ support, Union B has $30\%$, and Union C has $15\%$.
- Union A gets 2 representatives (for $40\%$ support).
- Union B gets 1 representative (for the first $20\%$, with a $10\%$ remainder).
- Union C is excluded (it has less than $20\%$).
- The Negotiating Council will have a total of 3 representatives.

Sub-Section (5): Decision Making by the Negotiating Council

Legal Text: When negotiation is held with a Negotiating Council, any agreement reached is valid only if it is agreed to by the majority of the representatives of the Trade Unions in such council.
Simple English: If an agreement is to be signed by the Council, it needs to be approved by most of the representatives sitting on that Council.
Example: The Negotiating Council has 5 members. Any final wage settlement proposed by management must be approved by at least 3 of those 5 members to become the formal, binding agreement.

Sub-Section (6): Duration of Recognition

Legal Text: Recognition of a sole negotiating union (Sub-sections 2 & 3) or the constitution of a negotiating council (Sub-section 4) is valid for three years from the date of recognition/constitution, but this period can be mutually extended up to a maximum of five years.
Simple English: Once a bargaining agent is chosen, it remains in power for a mandatory minimum of three years, providing stability. The employer and the agent can agree to extend this period, but never beyond a total of five years.
Example: The company recognizes Union A as the sole negotiating union on January 1, 2024. Union A is guaranteed this status until January 1, 2027. Before that date, both parties could agree to extend it until January 1, 2029 (a total of five years).

Sub-Section (7): Facilities for the Negotiating Body

Legal Text: The facilities (resources) to be provided by the industrial establishment to the negotiating union or council shall be such as may be prescribed.
Simple English: The law requires the employer to give the recognized union or council certain resources (like office space, time off for meetings, or access to company communication channels) as defined by the government rules.
Example: As per government rules, the company must provide the sole negotiating union with one small, dedicated office room within the premises for union business.

Section 15: Objects of general fund, composition of separate fund and membership fee of Trade Union

This section governs how a Trade Union handles its money, distinguishing between its general purpose funds and special political funds.

Sub-Section (1): General Fund Use

Legal Text: The general funds of a registered Trade Union shall not be spent on any objects other than such objects as may be prescribed.
Simple English: The money collected from standard membership fees can only be used for the legal, prescribed purposes necessary to run the union and support industrial relations (e.g., administrative costs, legal fees for industrial disputes).
Example: The union can use its general fund to hire a lawyer to fight a retrenchment case for a member, but it cannot use the general fund to support a political party campaign.

Sub-Section (2): Separate Political Fund

Legal Text: A registered Trade Union may constitute a separate fund from specific, separately collected contributions for the promotion of the civic and political interests of its members.
Simple English: A union can raise money specifically to engage in political activities (like lobbying for new laws or supporting candidates), but this money must be collected and kept in a separate account and cannot be mixed with general funds.
Example: The union leaders collect voluntary contributions specifically for “The Political Action Fund.” This fund can then be used to print flyers supporting a candidate for the State Assembly who promises to back worker rights.

Sub-Section (3): Voluntary Contribution to Political Fund

Legal Text: No member shall be compelled to contribute to the separate political fund, and a member who does not contribute cannot be excluded from any union benefits or placed at any disadvantage compared to other members (except regarding the control of that separate fund).
Simple English: Giving money to the political fund must be completely optional. If a member refuses to contribute, they cannot be denied their usual union benefits (like legal aid or health insurance), nor can they be treated unfairly by the union.
Example: A member refuses to donate to the Political Action Fund. The union cannot, because of this refusal, charge them higher dues or deny them the $5,000$ death benefit available to all members from the General Fund.

Sub-Section (4): Subscription Fee Setting

Legal Text: The subscriptions payable by the members of the Trade Union shall be such as may be prescribed.
Simple English: The government will set the official minimum or maximum rates for how much unions can charge their members in subscription fees.
Example: If the prescribed rules state the minimum monthly fee is Rs. 10, the union must charge at least that amount.

Section 16: Immunity from civil suit in certain cases

This section shields a registered Trade Union and its office-bearers from lawsuits in civil court for actions taken during an industrial dispute.

Sub-Section (1): Protection for Acts in Furtherance of a Dispute

Legal Text: “No suit or other legal proceeding shall be maintainable in any civil court against any registered Trade Union or any office-bearer or member thereof in respect of any act done in contemplation or furtherance of an industrial dispute… on the ground only that such act induces some other person to break a contract of employment or that it is an interference with the trade, business, or employment of some other person…”
Simple English: You cannot sue a registered union, its leaders, or members in a regular civil court for actions they take to advance an industrial dispute (like a strike or protest). This immunity specifically covers two actions:
1. Convincing a person to break their employment contract.
2. Interfering with a person’s or company’s business or trade.
Example: A registered union calls for a legal strike and its members picket the factory entrance. A non-union worker sees the picket line and decides not to show up for work, thereby breaking his contract. The employer cannot sue the union for persuading that worker to stay home.

Sub-Section (2): Protection Against Agent’s Wrongful Acts (Torts)

Legal Text: “A registered Trade Union shall not be liable in any suit or other legal proceeding in any civil court in respect of any tortuous act done in contemplation or furtherance of an industrial dispute by an agent of the Trade Union if it is proved that such person acted without the knowledge of, or contrary to express instructions given by, the executive of the Trade Union.”
Simple English: The union is protected from being sued for wrongful or negligent acts (torts) committed by someone acting on its behalf (an agent), if the union’s leadership (the executive) can prove they either didn’t know about the act or had explicitly told the agent not to do it.
Example: During a demonstration, a non-executive member (an agent) of the union, acting spontaneously, sprays graffiti on the factory wall (a tort). If the union executive can show that the member was acting against the union’s clear instructions to remain peaceful, the employer cannot successfully sue the Union for the cost of cleaning the graffiti.

Section 17: Criminal conspiracy in furtherance of objects of Trade Union

This section grants protection from criminal charges of conspiracy for agreements made to further the union’s legal objectives.

Legal Text: “No office-bearer or member of a registered Trade Union shall be liable to punishment under sub-section (2) of section 120B of the Indian Penal Code in respect of any agreement made between the members for the purpose of furthering any such object of the Trade Union as is specified in section 15, unless such agreement is an agreement to commit an offence.”
Simple English: An agreement between union members to pursue the union’s legal goals (like coordinating a strike or agreeing on negotiation tactics) is not considered a criminal conspiracy under the Indian Penal Code, unless the agreement is to commit an actual crime (like assault or property damage).
Example: Union leaders meet and agree on a strategy to refuse overtime work collectively. This agreement, while potentially impacting business, is not a criminal conspiracy. However, if they agree to sabotage a piece of machinery to stop production, that is an agreement to commit an offence and the protection is lost.

Section 18: Enforceability of agreements

This section clarifies that internal union agreements are not illegal just because they restrict trade, but it prevents the civil court from forcing members to comply with certain trade-related agreements.

Legal Text (Main Clause): “Notwithstanding anything contained in any other law… an agreement between the members of a registered Trade Union shall not be void or voidable merely by reason of the fact that any of the objects of the agreement are in restraint of trade.”
Simple English: Agreements made by the union (e.g., establishing rules for members on how they work or sell their labor) are still legally valid, even if they might otherwise seem to restrict competition or trade.
Example: The union rules require all electrician members to charge a minimum fee for side-work, effectively restricting their individual ability to set lower prices. This rule, which might otherwise be illegal under general contract law, is protected and deemed valid because it is an agreement within a registered Trade Union.
Proviso (Limitation on Civil Court): “Provided that nothing in this section shall enable any civil court to entertain any legal proceedings instituted for the purpose of enforcing or recovering damages for the breach of any agreement concerning the conditions on which any members of a Trade Union shall or shall not sell their goods, transact business, work, employ or be employed.”
Simple English: Although the agreements are legal, a civil court cannot be used to force a member to comply with them or to make them pay damages if they breach a rule about how they conduct their work or business.
Example: A union member breaches the union rule requiring him to charge a minimum fee (as per the example above). The union cannot go to a civil court to force the member to pay a fine or to comply with the minimum fee rule. The union’s enforcement must be internal (e.g., expulsion from the union).

Section 19: Right to inspect books of Trade Union

This mandates transparency by ensuring members have the right to check the union’s financial and membership records.

Legal Text: “The books of account of a registered Trade Union and the list of members thereof shall be open to inspection by an office-bearer or member of the Trade Union at such times as may be provided for in the rules of the Trade Union.”
Simple English: The union must let any of its leaders or members look at the official financial ledgers and the full list of members, subject to the inspection times set out in the union’s own rulebook (as required by Section 7).
Example: A member suspects the union’s funds are being mismanaged. Based on the union’s rules, the member requests to review the account books. The union must grant this request during the specified hours.

Section 20: Rights of minor to membership of Trade Union

This section sets the minimum age and working environment required for a person to be a Trade Union member.

Legal Text: “Any person who has attained the age of fourteen years and is employed in a non-hazardous industry may be a member of a registered Trade Union… and may… enjoy all the rights of a member and execute all instruments and given all acquaintances necessary to be executed or given under the rules.”
Simple English: Anyone who is 14 years old or older and works in an industry that is not considered hazardous is allowed to join a union. Once they join, they have all the same rights as an adult member (like voting and signing official documents related to union business).
Example: A 16-year-old employed part-time in a non-hazardous retail store can legally join the retail workers’ union. They can attend meetings, vote in union elections, and sign a union petition alongside adult members.

Section 21: Disqualification of office-bearers of Trade Unions

This section clearly defines who is legally prevented from holding a leadership position (office-bearer or executive member) in a registered Trade Union.

Sub-Section (1): General Disqualifications

Legal Text: A person is disqualified if:
(i) “he has not attained the age of eighteen years;”
- Simple English: You must be 18 or older to be elected as a union leader.
- Example: A 17-year-old worker, though allowed to be a member (Section 20), cannot run for or be elected as the Union Secretary.
(ii) “he has been convicted by a court in India for any offence involving moral turpitude and sentenced to imprisonment unless a period of five years has elapsed since his release;”
- Simple English: If you were convicted and jailed for a serious crime (one involving moral depravity), you are disqualified until five full years have passed since you were released from prison.
- Example: A former union leader served three years for fraud (an offense involving moral turpitude). If he was released in 2020, he cannot hold office until 2025.
(iii) “the Tribunal has directed that he shall be disqualified for being chosen or for being office-bearer of a Trade Union for a period specified therein.”
- Simple English: If the Tribunal (the judicial body) issues an order specifically banning you from holding office, you are disqualified for that time period.
- Example: In resolving a union election dispute, the Tribunal finds an office-bearer guilty of manipulating votes and bans him from holding office for seven years.

Sub-Section (2): Political and Government Disqualifications

Legal Text: “No member of the Council of Ministers or a person holding an office of profit (not being an engagement or employment in an establishment or industry with which the Trade Union is connected) in the Union or a State shall be a member of the executive or other office-bearer of a Trade Union.”
Simple English: Cabinet Ministers (in the Central or State government) and most people holding a paid government job (office of profit) are banned from holding a union leadership position. The exception is if their government job is, in fact, the employment that connects them to the industry the union represents.
Example: A State Minister of Finance is banned from being the President of the “Dock Workers Union.” However, if a low-level worker employed by the State Electricity Board (a government-owned enterprise) is an employee of that industry, they are not disqualified from becoming a leader in the State Electricity Workers’ Union.

Section 22: Adjudication of disputes of Trade Unions

This section designates the Tribunal as the exclusive body for resolving internal union-related conflicts, preventing them from being tied up in general civil courts.

Sub-Section (1): Scope of Disputes for Tribunal

Legal Text: An application may be made to the Tribunal for adjudication of disputes arising between:
(a) “one Trade Union and another; or”
- Simple English: Disputes between two rival unions.
- Example: Union A accuses Union B of illegally poaching its members in violation of an inter-union agreement. Union A files an application with the Tribunal to resolve the conflict.
(b) “one or more workers who are members of the Trade Union and the Trade Union regarding registration, administration or management or election of office-bearers of the Trade Union; or”
- Simple English: Disputes between members and their own union leadership over internal issues like how the union is run, managed, or elections.
- Example: A group of union members claims the recent election of the President was rigged. They apply to the Tribunal to challenge the election results.
(c) “one or more workers who are refused admission as members and the Trade Union; or”
- Simple English: Disputes where a worker wants to join the union but is unfairly rejected for membership.
- Example: A worker who actively supported a rival union is now refused membership by the current union leaders. The worker can appeal this refusal to the Tribunal.
(d) “where a dispute is in respect of a Trade Union which is a federation of Trade Unions and office-bearer authorised in this behalf by the Trade Union.”
- Simple English: Disputes involving the leadership structure of a larger organization composed of several smaller unions (a federation).
- Example: A federation’s internal rules are unclear about which union’s representative should hold the Treasurer position. The dispute is filed with the Tribunal.

Sub-Section (2): Exclusion of Civil Courts

Legal Text: “No civil court other than the Tribunal shall have power to entertain any suit or other proceedings in relation to any dispute referred to in sub-section (1).”
Simple English: For all the specific disputes listed above, a general civil court has no authority to hear the case. Only the specialized Tribunal can handle them.
Example: A union member tries to sue the union executive in a local District Court over the unfair election. The District Court must dismiss the case because the Tribunal has exclusive jurisdiction over union election disputes.

Section 23: Proportion of office-bearers to be connected with industry

This section sets rules to ensure that the leadership of the union remains closely connected to the actual workers they represent, limiting the number of “outsiders” who can hold office.

Sub-Section (1): The Rule for the Unorganised Sector

Legal Text (Mandate): “Not less than one-half of the total number of the office-bearers of every registered Trade Union in an unorganised sector shall be persons actually engaged or employed in an establishment or industry with which the Trade Union is connected.”
Simple English: For unions operating in the unorganised sector, at least $50\%$ of the leadership positions must be held by people who are actual workers in that industry.
Example: The “Street Vendors Union” (unorganised sector) has 10 office-bearers. At least 5 of them must be actual street vendors in that area; the other 5 can be outsiders (like lawyers or activists).
Proviso (Exemption): The appropriate Government may, by special or general order, exempt any Trade Union or class of Trade Unions from this rule.
- Example: The State Government, finding a specific unorganised sector union to be essential but lacking internal leadership talent, issues an order allowing it to have more than $50\%$ outside leaders temporarily.

Sub-Section (2): The Rule for Other Sectors (Organised/General)

Legal Text: All office-bearers of a registered Trade Union, except not more than one-third of the total number of the office-bearers or five, whichever is less, shall be persons actually engaged or employed in the establishment or industry with which the Trade Union is connected.
Simple English: In the organised sector, almost all leaders must be actual workers. Only a small, limited number of outside people are allowed:
- Compare the total number of positions to $1/3$rd of the total, or 5.
- The smaller number is the maximum number of outsiders permitted.
Example A (Large Union): A factory union has 30 office-bearers. $1/3$rd is 10. Since 5 is less than 10, the maximum number of outside office-bearers allowed is 5.
Example B (Small Union): A factory union has 6 office-bearers. $1/3$rd is 2. Since 2 is less than 5, the maximum number of outside office-bearers allowed is 2.
Explanation (Retired/Retrenched are Insiders): “An employee who has retired or has been retrenched shall not be construed as outsider for the purpose of holding an office in a Trade Union.”
- Example: The former factory manager retired last year. He can run for a union leadership position, and he will be counted as an insider (a worker connected to the industry), not one of the limited “outsiders.”

Section 24: Change of name, amalgamation, notice of change and its effect

This section provides the rules and procedure for registered unions that wish to change their name or merge with another union.

Sub-Section (1): Changing the Name

Legal Text: Any registered Trade Union may, with the consent of not less than two-third of the total number of its members and subject to sub-section (3), change its name.
Simple English: To change its official name, the union must get approval from at least $2/3$rds (about $66.7\%$) of its entire membership.
Example: The “Power Plant Union” has 900 members. It must secure the affirmative vote of at least 600 members to change its name to the “Energy Workers’ Alliance.”

Sub-Section (2): Amalgamation (Merging)

Legal Text: Any two or more registered Trade Unions may be amalgamated in such manner as may be prescribed.
Simple English: Multiple unions are allowed to formally merge into a single new union, following the rules set by the government.
Example: The “Northern Dock Union” and the “Southern Dock Union” agree to merge to form a single, stronger “National Dock Workers Union.”

Sub-Section (3): Notification to the Registrar

Legal Text: Written notice of every change of name or amalgamation must be sent to the Registrar.
- Name Change Signatures: Secretary + seven members of the union changing its name.
- Amalgamation Signatures: Secretary + seven members of each union involved in the merger.
- Inter-State Amalgamation: If the merged union’s head office is in a different State, the notice must also be sent to the Registrar of that State.
Simple English: The union must officially inform the Registrar in writing. The letter must be signed by the head (Secretary) and seven members from every union involved to prove the decision is legitimate and supported.
Example: When the “Northern” and “Southern” unions merge, the Secretary and seven members from each union must sign the amalgamation notice before it is sent to the Registrar.

Sub-Section (4): Name Check for Amalgamation/Change

Legal Text: The Registrar shall refuse to register the change if the proposed new name is identical or so nearly resembles an existing registered union’s name that it is likely to deceive the public or members.
Simple English: Even after the members vote for a new name, the Registrar will reject it if it causes confusion with an existing union’s name.
Example: A union tries to change its name to “All India Coal Workers’ Federation,” but the Registrar refuses because there is already a “National Coal Workers’ Federation,” which is too similar and would confuse people.

Sub-Section (5): Effect of Name Change Registration

Legal Text: If compliance is met (and the name is unique), the Registrar registers the change of name, and the change has effect from the date of such registration.
Simple English: The union’s new name is legally recognized only from the day the Registrar officially records it in the register.
Example: A union votes for a name change in May, but the Registrar registers it on August 15. The union must continue to use the old name until August 15.

Sub-Section (6): Effect of Amalgamation Registration

Legal Text: The Registrar registers the amalgamation if satisfied with compliance and the merged union is entitled to registration. The amalgamation has effect from the date of such registration.
Simple English: Once the Registrar verifies all legal steps are taken, the merger is officially recorded, and the new, single union comes into legal existence on that date.
Example: The merged “National Dock Workers Union” officially begins its legal life (with all combined assets, members, and liabilities) on the day the Registrar registers the amalgamation.

Sub-Section (7): Legal Continuity After Name Change

Legal Text: The change in name does not affect any rights or obligations of the Trade Union or render defective any legal proceeding by or against the Trade Union.
Simple English: Changing the name is purely administrative and does not affect the union’s continuous existence or its legal standing. Any ongoing lawsuit simply continues under the union’s new name.
Example: The union was being sued under its old name for a past action. When the name changes, the lawsuit does not stop or become invalid; the court simply updates the defendant’s name on the case file.

Sub-Section (8): Creditor Protection After Amalgamation

Legal Text: An amalgamation of two or more registered Trade Unions shall not prejudice any right of any such Trade Unions or any right of a creditor of any of them.
Simple English: Merging unions cannot be used as a trick to escape debts. Anyone owed money by one of the old unions before the merger still has the right to collect that debt from the new, merged union.
Example: Union A owed Rs. 50,000 to a printer. When Union A merges with Union B, the new merged union is still responsible for paying that Rs. 50,000 debt; the creditor’s rights are protected.

Section 25: Dissolution

This section governs the process for permanently winding up and closing a registered Trade Union.

Sub-Section (1): The Dissolution Process

Legal Text: When a registered Trade Union is dissolved, notice of the dissolution signed by seven members and by the secretary must be sent to the Registrar within fourteen days of the dissolution. The dissolution has effect from the date of the Registrar’s registration.
Simple English: Once the union decides to close down, they must immediately tell the Registrar. The official notice, signed by the leader and seven members, must arrive at the Registrar’s office within two weeks. The union is only legally closed once the Registrar records it.
Example: The last meeting of the union votes to dissolve on March 1st. The official notice must be sent to the Registrar by March 15th. If the Registrar records the dissolution on March 25th, that is the date the union legally ceases to exist.

Sub-Section (2): Distribution of Funds

Legal Text: Where the rules of the Trade Union do not provide for the distribution of funds of the Trade Union on dissolution, the Registrar shall divide the funds amongst the members in such manner as may be prescribed.
Simple English: If the union’s own rulebook failed to specify how money should be distributed when it closes (e.g., all to charity, or equally among members), the government Registrar steps in and decides how the remaining money should be split up among the current members.
Example: A dissolved union has Rs. 1,00,000 left, but its rulebook is silent on fund distribution. The Registrar then applies the government’s standard rules to divide the Rs. 1,00,000 fairly among the union’s final membership list.

Section 26: Annual returns

This section lays out the strict reporting requirements a registered Trade Union must follow to maintain its registration and transparency.

Sub-Section (1): Annual Filing Requirements

Clause (a) (Financial Statement):
- Legal Text: Every registered Trade Union shall forward annually to the Registrar, on or before a prescribed date, a general statement containing particulars of all receipts and expenditure… and of the assets and liabilities… audited in such manner and by such person, as may be prescribed.
- Simple English: Every union must file a yearly financial report with the Registrar by a specific deadline. This report must be checked by an auditor and clearly show all money earned, spent, and what assets and debts the union holds for the year ending December 31st.
- Example: The “Construction Workers Union” hires an external accountant to audit its books. It must submit the audited report, detailing its annual income and expenditures, to the Registrar by the prescribed deadline (e.g., March 31st).
Clause (b) (Rules and Officers):
- Legal Text: Along with the general statement… forward to the Registrar a statement showing changes of office-bearers made… together also with a copy of the rules of the Trade Union corrected up to the date of dispatch…
- Simple English: When filing the financial report, the union must also include a list of any new leaders elected during the year and a clean, up-to-date copy of its rulebook, including all recent amendments.
- Example: The union held its annual election in October. The filing must include a list of the newly elected Treasurer and Secretary, and the latest version of the union constitution showing any rule changes passed that year.

Sub-Section (2): Mandatory Reporting of Rule Alterations

Legal Text: A copy of every alteration made in the rules of a registered Trade Union shall be sent to the Registrar within fifteen days of the making of the alteration.
Simple English: If the union changes any of its rules, it must notify the Registrar within two weeks of the vote.
Example: The union members vote to increase the monthly membership fee on June 5th. The Treasurer must send a copy of the rule amendment to the Registrar by June 20th.

Sub-Section (3): Registrar’s Inspection Powers

Legal Text: The Registrar or any authorised officer may at all reasonable times inspect the certificate of registration, account books, registers and other documents, relating to a Trade Union, at its registered office or may require their production at such place as he may specify… but no such place shall be at a distance of more than fifteen kilometres from the registered office of such Trade Union.
Simple English: The government has the power to audit the union. An official can inspect the union’s legal documents and financial records, either directly at the union’s office or at a nearby location (within $15$ km) that the officer specifies.
Example: The Registrar suspects a union is using funds illegally. They issue an order requiring the union’s Treasurer to bring all financial ledgers and bank statements to the Registrar’s office for inspection next week.

Section 27: Recognition of Trade Unions at Central and State level

This section provides a formal mechanism for national and state governments to grant high-level recognition to large, influential unions or federations.

Sub-Section (1): Central Trade Union Recognition

Legal Text: Where the Central Government is of the opinion that it is necessary… to recognise a Trade Union or federation of Trade Unions as Central Trade Union at the Central level, it may recognise such Trade Union… for such purpose, as may be prescribed… and if any dispute arises in relation to such recognition, it shall be decided by such authority in such manner as may be prescribed by the Central Government.
Simple English: The Central Government can formally recognize a union or a group of unions as a “Central Trade Union” (i.e., a national representative body) for specific, high-level policy work. Any conflicts over who gets this high status will be resolved by an official process set by the Central Government.
Example: The Central Government is forming a National Policy Committee on Coal Industry Safety. It grants “Central Trade Union” status to the largest miners’ federation so that the federation can appoint a representative to the committee.

Sub-Section (2): State Trade Union Recognition

Legal Text: Where the State Government is of the opinion that it is necessary… to recognise a Trade Union or federation of Trade Unions as State Trade Union at the State level, it may recognise such Trade Union… for such purpose, as may be prescribed… and if any dispute arises in relation to such recognition, it shall be decided by such authority in such manner as may be prescribed by the State Government.
Simple English: Similarly, the State Government can formally recognize a union or a group of unions as a “State Trade Union” (a state-level representative body) for specific purposes within the state. Conflicts over this recognition are handled by a process set by the State Government.
Example: The Kerala State Government is setting up a minimum wage board for the fisheries sector. It officially recognizes the “Kerala Fish Workers’ Union” as a “State Trade Union” so it can send a delegate to the board.