Industrial Employment (Standing Orders) Act.

The object of the Act is to require employers in industrial establishments to formally define conditions of employment under them.

What are ‘Standing Orders’ – ‘Standing Orders’ means rules of conduct for workmen employed in industrial establishments. ‘Standing orders’ means rules relating to matters set out in the schedule to the Act. [section 2(g)]. The schedule to the Act requires that following should be specified in Standing Orders – (a) classification of workmen i.e. temporary, badli, casual, permanent, skilled etc. (b) manner of intimating to workmen working hours, shift working, transfers etc. (c) Holidays (d) Attendance and late coming rules (e) Leave rules (f) Leave eligibility and leave conditions (g) Closing and reopening of sections of industrial establishment (h) termination of employment, suspension, dismissal etc. for misconduct and acts or omissions which constitute misconduct (i) Retirement age (j) Means of redressal of workmen against unfair treatment or wrongful exactions by employer (k) Any other matter that may be prescribed.

Coverage of Act – The Act is applicable to all ‘industrial establishments’ employing 100 or more workmen. [section 1(3)].

‘Industrial establishment’ means (i) an industrial establishment as defined in section 2(i) of Payment of Wages Act (ii) Factory as defined in section 2(m) of Factories Act (iii) Railway (iv) Establishment of contractor who employs workmen for fulfilling contract with owner of an industrial establishment. [section 2(e)].

The term ‘industrial establishment’ includes factory, transport service, construction work, mines, plantation, workshop, building activity, transmission of power etc.

WORKMAN – ‘Workman’ has meaning assigned to it under section 2(s) of Industrial Disputes Act. [section 2(i)]. Thus, ‘workman’ includes skilled, unskilled, manual or clerical work. However, ‘workman’ does not include employees engaged in managerial or administrative capacity or supervisory capacity. ‘Workman’ does not include workers subject to Army Act, Navy Act or Air Force Act or to police or prison services.

Approval of Standing Orders – Every employer covered under the Act has to prepare ‘Standing Orders’, covering the matters required in the ‘Standing Orders’. Five copies of these should be sent to Certifying Officer for approval. [section 3(1)]. ‘Certifying Officer’ means Labour Commissioner and any officer appointed by Government to be ‘Certifying Officer’. [section 2(c)].

The Certifying Officer will inform the Union and workmen and hear their objections. After that, he will certify the ‘Standing Orders’ for the industrial establishment. [section 5]. Till standing orders are certified, ‘Model Standing Order’ prepared by Government will automatically apply. [section12A].

Standing order should be displayed in English and local language on special notice boards at or near entrance of the establishment. [section 9]. Modifications of Standing Order shall be done by following similar procedure. [section 10].

Once the ‘Standing Orders’ are certified, they supersede any term and condition of employment, contained in the appointment letter. If there is inconsistency between ‘Standing Order’ and ‘Appointment Letter’, the provisions of ‘Standing Order’ prevail – Eicher Goodearth Ltd. v. R K Soni – (1993) XXIV LLR 524 = 1993 LLR 524 (Raj HC) * Printers House v. State of Haryana 1982 II LLN 327.

Standing orders are binding on employer and employee. These are statutorily imposed conditions of service. However, they are not statutory provisions themselves (meaning that the ‘Standing Orders’ even when approved, do not become ‘law’ in the sense in which Rules and Notifications issued under delegated legislation become after they are published as prescribed.) – Rajasthan SRTC v. Krishna Kant – AIR 1995 SC 1715 = (1995) 5 SCC 75 = 71 FLR 211 = 87 FJR 204 = 1995 AIR SCW 2683 = 1995 LLR 481 (SC).

Model Standing Orders – The Act has prescribed Model Standing Orders. These are automatically applicable till employer prepares his own ‘Standing Orders’ and these are approved by ‘Certifying Officer’. [section 12A].

Disciplinary Action – The most important use of ‘Standing Orders’ is in case of disciplinary action. A workman can be punished only if the act committed by him is a ‘misconduct’ as defined under the ‘Standing Orders’. The ‘Model Standing Orders’ contain such acts like insubordination, disobedience, fraud, dishonesty, damage to employer’s property, taking bribe, habitual absence or habitual late attendance, riotous behaviour, habitual neglect of work, strike in contravention of rules etc. as misconducts. The ‘Certified Standing Orders’ may cover other acts as ‘misconduct’, if approved by ‘Certifying Officer’.

Subsistence Allowance – Where a workman is suspended by employer pending investigation or enquiry into complaints or charges of misconduct against him, the workman shall be paid subsistence allowance equal to 50% of wages for first 90 days of suspension and 75% of wages for remaining period till completion of disciplinary proceedings. [section 10A(1)]. – – ‘Wages’ has same meaning as under section 2(rr) of Industrial Disputes Act. [section 2(i)].