Section 10A of the Industrial Disputes Act 1947 - Voluntary Reference of Disputes to Arbitration

Section 10A permits an employer and workmen to voluntarily refer an existing or apprehended industrial dispute to arbitration by a written agreement, provided the dispute has not already been referred under Section 10 to a Labour Court, Tribunal or National Tribunal. It also regulates the arbitrator, umpire, publication of the agreement, participation of concerned non-parties, the arbitration award and related strike or lock-out restrictions.

Legal scope: This article states the legal position before 1 July 2024, when the Bharatiya Sakshya Adhiniyam, 2023 came into force. The Bharatiya Sakshya Adhiniyam concerns evidence and did not itself amend Section 10A of the Industrial Disputes Act, 1947.

Section 10A at a glance

The industrial dispute may already exist or may be apprehended.
The employer and workmen must agree to arbitration.
The agreement must be made before a reference under Section 10 to a Labour Court, Tribunal or National Tribunal.
The arbitration agreement must be in writing, in the prescribed form and signed in the prescribed manner.
An even number of arbitrators requires provision for an umpire.
A copy must be sent to the appropriate Government and Conciliation Officer.
The appropriate Government must publish the agreement in the Official Gazette within one month of receipt.
Where Section 10A(3A) applies, concerned employers and workmen who did not sign the agreement must be given an opportunity to present their case.
The arbitrator or arbitrators investigate the dispute and submit a signed arbitration award to the appropriate Government.

Section 10A - Central provision explained

Sub-section (1) - Voluntary reference: Where an industrial dispute exists or is apprehended and the employer and workmen agree to refer it to arbitration, they may do so by written agreement at any time before the dispute has been referred under Section 10 to a Labour Court, Tribunal or National Tribunal. The arbitrator may be the person or persons specified in the agreement, including the Presiding Officer of a Labour Court, Tribunal or National Tribunal.

Sub-section (1A) - Umpire: If the agreement refers the dispute to an even number of arbitrators, it must provide for another person as umpire. The umpire enters upon the reference if the arbitrators are equally divided, and the umpire's award prevails and is treated as the arbitration award for the purposes of the Act.

Sub-section (2) - Form and signature: The arbitration agreement must be in the prescribed form and signed by the parties in the prescribed manner.

Sub-section (3) - Forwarding and Gazette publication: A copy of the arbitration agreement must be forwarded to the appropriate Government and the Conciliation Officer. The appropriate Government must publish it in the Official Gazette within one month from receipt.

Sub-section (3A) - Majority representation and concerned non-parties: If the appropriate Government is satisfied that the persons making the reference represent the majority of each party, it may issue the prescribed notification within the period stated in sub-section (3). When such notification is issued, employers and workmen concerned in the dispute who are not parties to the arbitration agreement must be given an opportunity to present their case before the arbitrator or arbitrators.

Sub-section (4) - Arbitration award: The arbitrator or arbitrators investigate the dispute and submit to the appropriate Government an arbitration award signed by the arbitrator or by all the arbitrators, as applicable.

Sub-section (4A) - Strike or lock-out: Where the dispute has been referred to arbitration and a notification has been issued under sub-section (3A), the appropriate Government may prohibit continuation of a strike or lock-out connected with that dispute which exists on the date of the reference.

Sub-section (5) - Arbitration Act, 1940: The section expressly states that the Arbitration Act, 1940 does not apply to arbitrations under Section 10A. This is the wording of the Industrial Disputes Act provision within the historical legal position covered by this article.

Meaning of industrial dispute

Section 2(k) defines "industrial dispute" as a dispute or difference between employers and employers, employers and workmen, or workmen and workmen, which is connected with employment or non-employment, terms of employment, or conditions of labour of any person. Section 2A separately deals with specified disputes arising from discharge, dismissal, retrenchment or termination of an individual workman.

Meaning of appropriate Government

The expression "appropriate Government" is defined in Section 2(a). Whether the Central Government or a State Government is the appropriate Government depends on the industry, establishment and other statutory criteria set out in that definition. This is important because Section 10A requires the arbitration agreement and award to be sent to the appropriate Government and gives that Government specified notification and strike or lock-out powers.

Prescribed arbitration agreement

Section 10A(2) requires the agreement to be in the prescribed form and signed in the prescribed manner. Under the Industrial Disputes (Central) Rules, 1957, Rule 7 addresses the arbitration agreement for disputes in respect of which the Central Government is the appropriate Government, and the prescribed agreement is associated with Form C. State rules should be checked where a State Government is the appropriate Government.

When can parties choose Section 10A arbitration?

The central requirement is timing. The parties may voluntarily choose arbitration while the industrial dispute exists or is apprehended, but they must do so before that dispute has been referred under Section 10 to a Labour Court, Tribunal or National Tribunal. Section 10A therefore provides a consensual statutory route distinct from a Government reference for adjudication under Section 10.

Arbitration award and binding effect

An arbitration award under Section 10A is integrated into the Industrial Disputes Act framework. Section 2(b) includes an arbitration award made under Section 10A within the definition of "award". Publication and enforceability are governed by the relevant provisions of the Act, including Sections 17 and 17A. Section 18 addresses the persons on whom settlements and awards are binding, including the statutory treatment of arbitration awards where a notification under Section 10A(3A) has been issued.

State amendments preserved from the source

Andhra Pradesh - Section 10B

The source records Andhra Pradesh Act 32 of 1987 inserting Section 10B. It empowers the State Government, in the circumstances specified in the State provision, to make general or special orders concerning terms and conditions of employment and prohibition of strikes or lock-outs. If an industrial dispute is raised regarding a provision of such an order within three months, the State provision requires reference for adjudication to an Industrial Tribunal or Labour Court, subject to its terms.

Karnataka - Section 10B

The source records Karnataka Act 5 of 1988 inserting a State Section 10B dealing with orders regarding terms and conditions of service pending settlement of a dispute referred under Section 10(1). It includes provisions concerning terms and conditions of employment, continuation of a public utility service, incidental matters, a protection against less favourable terms, the period of operation of an order and adjustment of money paid under the order against monetary benefits under the eventual award.

Kerala - Section 10B

The source records Kerala Act 30 of 1979 inserting Section 10B concerning State Government orders regarding terms and conditions of service pending settlement of disputes. The provision includes safeguards regarding less favourable employment terms, public utility services, duration of the order and adjustment of payments against benefits under the award.

Maharashtra - amendments to Section 10A

The source records Maharashtra Act 1 of 1972. It modifies Section 10A in relation to a recognised union under applicable law, adds a proviso concerning Section 10A(3A), and modifies Section 10A(4A) for an undertaking having a recognised union.

Rajasthan - Chapter III-A Arbitration

The source records Rajasthan Act 34 of 1958 substituting a State arbitration framework containing Sections 10B to 10J. It deals with submission of present or future industrial disputes to arbitration, registration and publication of submissions, revocation, arbitration proceedings, questions of law, awards, reference to the Industrial Tribunal where no arbitrator is appointed, State Government reference in specified circumstances, notice of award and completion of proceedings. The source further records Rajasthan Act 14 of 1970 inserting Section 10K concerning State Government orders on employment terms and prohibition of strikes or lock-outs in the circumstances stated there.

Tamil Nadu - Section 10B

The source records Tamil Nadu Act 36 of 1982 inserting Section 10B concerning orders regarding terms and conditions of service pending settlement of disputes. The provision covers employment terms, public utility services, incidental matters, protection against less favourable terms, duration of orders and adjustment of payments against monetary benefits under an award.

Legislative history

Section 10A was inserted by the Industrial Disputes (Amendment and Miscellaneous Provisions) Act, 1956 and came into force on 10 March 1957. Sub-sections (1A), (3A) and (4A), and the change in sub-section (3) from fourteen days to one month, were introduced by the Industrial Disputes (Amendment) Act, 1964 with effect from 19 December 1964.

Official sources

Refer to the Industrial Disputes Act, 1947 on India Code, the Ministry of Labour and Employment copy of the Industrial Disputes Act, 1947, and the Chief Labour Commissioner Industrial Disputes Act resource.

The applicable Central or State law and rules should be checked for the establishment, dispute and period concerned, particularly where a State amendment modifies the central scheme.