Section 25E of the Industrial Disputes Act 1947 - When Lay-off Compensation Is Not Payable
Section 25E specified three situations in which a workman who had been laid off was not entitled to lay-off compensation: refusal of qualifying alternative employment, failure to present for work as required, and a lay-off caused by a strike or slowing down of production by workmen in another part of the establishment.
What did Section 25E provide?
Section 25E operated as an exception to the right to lay-off compensation. A laid-off workman was not to be paid compensation where any of the three statutory grounds in clauses (i), (ii) or (iii) applied.
Three cases where compensation was not payable
| Ground | Section 25E requirement |
|---|---|
| Refusal of alternative employment | Compensation could be denied where the workman refused qualifying alternative employment offered in the same establishment or another establishment of the same employer within the geographical limit and on the conditions specified in clause (i). |
| Failure to present for work | Compensation was not payable if the workman did not present himself for work at the establishment at the appointed time during normal working hours at least once a day. |
| Strike or slowing down elsewhere | Compensation was not payable if the lay-off was due to a strike or slowing down of production by workmen in another part of the establishment. |
Refusal of alternative employment under Section 25E(i)
Refusal of any job did not automatically disentitle a workman. The alternative employment contemplated by Section 25E(i) had to satisfy the statutory conditions.
| Condition | Requirement |
|---|---|
| Employer and establishment | The alternative work had to be in the same establishment or another establishment belonging to the same employer. |
| Location | The other establishment had to be in the same town or village, or within a radius of five miles from the establishment to which the workman belonged. |
| Nature of work | In the employer's opinion, the alternative employment must not call for special skill or previous experience and must be work the workman could perform. |
| Wages | The wages normally payable to the workman had to be offered for the alternative employment also. |
Attendance requirement under Section 25E(ii)
A laid-off workman could lose entitlement to compensation by failing to present himself for work at the establishment at the appointed time during normal working hours at least once a day. This provision should be read with Section 25D, which required the employer to maintain a muster roll and provide for attendance entries by workmen presenting themselves for work.
Strike or slowing down in another part of the establishment
Under Section 25E(iii), compensation was not payable where the lay-off was caused by a strike or slowing down of production on the part of workmen in another part of the establishment. The statutory requirement concerned the causal connection between that industrial action or slowing down and the lay-off.
Connection with Section 25C
Section 25C created the right to lay-off compensation for qualifying workmen, generally at 50 percent of basic wages plus dearness allowance, subject to its conditions. Section 25E then identified specific circumstances in which compensation was not payable. The provisions therefore need to be read together.
Meaning of lay-off
For this statutory framework, "lay-off" was defined in Section 2(kkk) of the Industrial Disputes Act, 1947. Broadly, it concerned the failure, refusal or inability of an employer, for the reasons specified in the statutory definition, to give employment to a workman whose name was borne on the muster rolls and who had not been retrenched. The complete statutory definition and explanation should be applied to the facts of the particular case.
Application of Sections 25C to 25E
Section 25A governed the application of Sections 25C to 25E. It excluded specified establishments, including establishments to which Chapter V-B applied, establishments below the statutory workforce threshold, and establishments of a seasonal character or where work was performed only intermittently.
West Bengal State amendment
The source page records a West Bengal amendment made by West Bengal Act 57 of 1980. It inserted a proviso after clause (ii) under which, where a lay-off extends beyond seven days at a stretch, the workman may be required to present himself only once in a week. The applicability and current text of a State amendment should be verified from the official State legislation applicable on the relevant date.
Official statutory sources
The central text of the Industrial Disputes Act, 1947 can be checked through India Code and the Ministry of Labour and Employment. In an individual dispute, applicable State amendments, rules, notifications and binding judicial decisions should also be checked for the relevant date.