Standing Order Requirement of Industrial Establishments

Standing order concerns the growth of the relation of Indian labour. Earlier, workmen were engaged regularly with uncertain and vague employment terms.

The Industrial Employment (Standing Orders) Act, 1946, was enacted to define employment conditions in industrial establishments. It allows the industrial establishment to get a standing order to lay down the working conditions for employees. The importance of the order is most in the unorganised sector. The standing order imposes a statutory duty on the employer and employee to comply with.

Let’s go in-depth to understand more about Standing order.

Background Of Standing Order

Industrial Employment (Standing Order) Act, 1946 got passed to organise industrial establishments. The government also laid down Industrial Employment (Standing Order) Rules 1946 to guide employers to follow such rules.

When an employer deviates from the Standing Order, an employee can enforce it through labour courts. The Act provides regular standing orders for workers, factories and working relationships. The main motive behind the introduction of standing order was to promote peace and harmony among industries, thus supporting fair industrial practices.

The Industrial Employment (Standing Order) Act, 1946; the Industrial Disputes Act, 1947 and The Trade Union Act, 1926 was consolidated by the Industrial Relations Code, 2020. The Code was enacted in 2020, stating conditions for employment in industrial establishments.

Concept of Standing Order

The Industrial Employment (Standing Orders) Act 1946 introduced the standing order, which generally means the law governing the relationship between the employee and employer. The law includes the classification of workers, working hours, attendance, suspension and termination etc.

Section 2(g) of the Industrial Employment (Standing Order) Act, 1946 defines Standing Order. According to this Act, Standing Order means rules gets related to matters in the Schedule of the Act. The classification of issues under the Schedule is as follows:

1. Classification of employee
2. Intimidation of working period
3. Working shifts
4. Attendance and late coming of employee
5. Conditions and procedure for leave application
6. Entry in premises by gates and search liability
7. Non- functioning of certain areas or temporary stoppage of work and the rights and liabilities of employer and employee.
8. Termination conditions
9. Provisions related to misconduct
10. Redressal mechanism
11. Any other matter that gets prescribed by the appropriate government

Conditions for Certification of Standing Orders

Section 4 of the Industrial Establishment (Standing Order) Act provides conditions for certification of standing orders. It gets a standing order prepared for every matter provided under the Schedule of the Act, and orders conform with the provisions of the Act.

It is the duty of the Certifying Officer or appellate authority to deal with the fairness and reasonableness of the Standing Orders.

Process of Certification

Section 5 provides procedures for certification of standing order are:

• The Certifying Officer sends a copy of the draft of the standing order to the workmen or trade union. Along with the draft, notice gets sent to call for objection. The objection can get raised within 15 days of receiving notice.
• After receiving the objection, the employer and the workmen are allowed to get heard by certifying officer. After hearing, the certifying officer decides and passes the order for modifications in standing order as required.
• The Certifying Officer then certifies the order within seven days and attach an order for modification as required.

Nature and effect of certified standing order

• It lays down the liabilities and rights of employers and employees during employment.
• After a order gets certified, it has a binding effect. Both employer and employee get bound by the standing order once it is certified. The employer and employee should compulsorily follow the terms and conditions mentioned in the certified standing order.
• The certifies standing order confirms the first schedule of the Industrial Employment (Standing Order) Act.
• Standing orders are like statutory provisions. Standing Orders are not statutory provisions but are binding and must get followed by the employer and employee.
• The orders should be fair and reasonable.
• The certifying orders have an overriding order on the agreement as a letter of appointment.

Exclusion from certification of certain Industrial Establishments

Some industrial establishments got excluded from the purview of the Act. They are:

• The establishment where Chapter VII of the Bombay Industrial Relations Act applies
• The establishments where provisions of the Madhya Pradesh Industrial Employment (Standing Order) Act, 1961 applies
• The provisions of Section 10 and Section 12 A of the Industrial Employment (Standing Orders) Act 1946 do not apply to the industrial establishment under the control of the State Government of Gujarat and the State Government of Maharashtra
• Provision of Section 13 of the Industrial Establishment (Standing Order) Act, 1961 excludes the establishment where workmen have to follow the Fundamental and Supplementary Rules, Various Civil Services Rules and other rules mentioned under section 13 B or any other rules as notified by the appropriate government.

Penalties under Standing Order

Section 13 of the Industrial Employment (Standing Order) Act provides penalties for non-compliance with the provision provided by the act.

According to this section, the penalties are as follows:

• If an employer fails to submit the draft of the order as required under section 3 of the act, he shall be punishable with a fine of Rs. 5000/-. On continuing the offense, the person will get punished to pay a further fine of Rs. 200/- per day till the provisions are complied with.
• If an employer fails to comply with the provisions of section 10 of the Industrial Employment Act, 1946, he shall be punishable with a fine of Rupees 5000/-. On continuing the offense, the person will get punished to pay a further fine of Rs. 200/- per day till the provisions are complied with.
• If an employer fails to comply with the certified standing order, he shall be punishable with a fine that extends to Rs. 100. In case of a continuing offence, the penalty may be Rs. 25 per day till the offence continues.

Conclusion

The standing orders act as a binding contract between the employer and employee whose provisions are to be followed by both employer and employee; the order is certified to make it effective. The standing order must have the points mentioned in the First Schedule to fulfil the statutory condition of the order. The order should satisfy the needs of the employer and employee and must be acceptable by trade unions to be certified by the certifying authorities.

The Industrial Employment Act, 1946, deals with the requirement of the standing order. But in 2020, the three acts that include the Industrial Employment (Standing Order) Act, 1946 are consolidated with the Industrial Relation Code 2020, making the order more binding and statutorily effective.

About Author

Anshita Surana

Anshita Surana, born in the year 1999 in Guwahati, Assam and brought up in Hanumangarh, Rajasthan, where I completed my elementary and secondary education from the CBSE board.

Currently, Pursuing B.B.A.LL.B(H) from K. R. Mangalam University, Gurugram.

See author's posts →