Strikes & lockouts can be described as two sides of the same coin; both are executed to force the other party to concede to its demands. Strikes are executed by workers whereas lockouts are executed by management of the industry. In the Industrial endeavour, both management and workers have different goals therefore interest of both should be kept in mind, failure to do so will lead to strikes and lockdown, which can have a rippling effect on the production. At this juncture it is pertinent to mention the judgement of Management of Kairbetta v/s Rajamanickam And Others where the court stated Just as a strike is a weapon available to the employees for enforcing their industrial demands, a lockout is a weapon available to the employer to persuade by a coercive process the employees to see his point of view and to accept his demands. In the struggle between capital and labour, the weapon of strike is available to labour and is often used by it, so is the weapon of lockout available to the employer and can be used by him. The use of both the weapons by the respective parties Must, however, be subject to the relevant provisions of the Industrial Disputes Act. Chapter V which deals with strikes and lockouts clearly brings out the antithesis between the two weapons and the limitations subject to which both of them must be exercised. Let’s discuss each one in detail.
Strike is one of the ways to ensure economic justice for workers. It is dealt with under the Industrial Disputes Act. Section 2 (q) of the Act defines strike as-
Strike is a cessation of work by a body of persons employed in any industry acting in combination, or a concerted refusal, or a refusal under a common understanding, of any number of persons who are or have been so employed to continue to work or to accept employment.
Positive implications for Union
1. Whether to come to work or not, that decision lies with the union. A strike gives higher bargaining power to the union.
2. Strike gives the union the opportunity to unite together and send a firm signal to the management. It also enables unions to regain lost support from the workers.
Negative implication for Union
One of the biggest implications of the strike is loss of wages for union, if the strike is unjustified the wages are cut however if the reason of the strike is legally valid and justified then wages might be paid. As the period of strike increases, the bargaining power of the union also diminishes over the period of time and in some cases it might go lower to the pre-strike period.
Implication of strike on Employer
In cases of strike, employers most of the time have to come to the terms of the union and the union enjoys a very high level of bargaining powers in initial days of strike. Management also has to bear loss for each day of the strike, further since most of the times concede to the demand of the union, which translates into even more financial burden. Hence It can be said that strike is a lose-lose situation for the employer.
Implication of strike on the government
Strikes have a massive implication on the government & political set up in the area of strike. The political parties use strikes to strike an emotional connection with the workers to maintain their vote-bank. This furthers mounts pressure on the government, which has to ensure that the employer is not at a disadvantage while at the same time the workers have to be satisfied too.
Lockout in layman’s language can be defined as a temporary shutdown till a settlement is arrived between management and union. Lockout is a condition of work stoppage in which an employer prevents & obstructs employees from working. It is a tactic used by employers to put pressure on their workers to come about settlement of issued lead to lockout. This is different from a strike, in which the opposite happens where employees refuse to work. Thus, a lockout can be termed as employers’ weapon while a strike is declared on part of employees. According to 2(1) of Industrial Disputes Act 1947, lock-out means the temporary closing of a place of employment or the suspension of work or the refusal by an employer to continue to employ any number of persons employed by him. It causes losses to both the management and workers.
It is often seen that people generally interchangeably use lockout & closure. The two are two different terms. The Indian judiciary has also deliberated in differentiating between closure and lockout in the case of Managememt of Express Newspapers Ltd case , Gajendragadkar J beautifully explained that in case of a closure, the employer does not merely close down the place of business; he closes the business itself. It is also mentioned that lockout is often used by the employer as a weapon in his armoury to compel the employees to accept his proposals. Further Indian judiciary has also deliberated on the difference between in Kairbetta Estate v Rajamanicham The Supreme Court stated that the employer can resort to lay off only in one of the cases mentioned in Section 2(k) of ID Act whereas there is no such requirement in case of a lockout. Also, in case of lay off the employer may be liable to pay compensation whereas in case of lock out there is no such liability.
Legal Status conferred to lockout
A lockout in direct contravention of Sec 10(3) & Sec 10A (4A) of ID Act i.e. declaration of lock-out when an industrial dispute has been referred, is an illegal lockout. Also, a lockout in violation of Sec 22 & 23 i.e. issuing a notice before lockout is an illegal lockout Sec 24(1). However a lockout declared against an illegal strike is legal Sec 24(3). A legal lockout can be used as a strong tool in the hands of the employer in crucial situations against workers.
In the case of General Labour Union (Red Flag) v/s B. V. Chavan And Ors The Apex Court said that Imposing and continuing a lockout deemed to be illegal under the Act is an unfair labour practice. Further in Sri Ramchandra Spinning Mills v/s State of Madras Court stated- A flood may have swept away the factory, a fire may have gutted the premises; a convulsion of nature may have sucked the whole place underground; still if the place of employment is closed or the work is Suspended or the Employer refuses to continue to employ his previous workers, there would be a lock out and the Employer would find himself exposed to the penalties laid down in the Act. Obviously, it shows that the definition given under the Act does not convey the concept of the term lockout.
According to Section 22 of Industrial Disputes Act Act, lockout of industry must be done only after issuing prior notice to concerned employees. If notice is not served, such lockout shall be treated as illegal lockout and concerned factory or industry shall be penalised according to provisions given under the Industrial Disputes Act 1947. A lock-out against an illegal strike is not deemed to be illegal. But if lock-out is illegal, Section 26(2), 27 and 28 will come into play to deal with the situation.
Implications of lockout on the government
In the case of a lockout, the government plays the paramount role of mounting pressure on management to allow production, which is much more than the government putting pressure on the union to resume work in case of a strike. Further reference of the industrial dispute for adjudication is initiated by the government which keeps a check that there are no legal strikes or lockouts.
India in the present Industrial age can’t afford a regular conflict between management and union. In the Industrial endeavour, both management and workers have different goals therefore interest of both should be kept in mind, failure to do so will lead to strikes and lockdown, which can have a rippling effect on the production & the economy. Therefore to keep an eye on the illegal strikes & lockouts, this Act has been brought into place. Strike is one of the ways to ensure economic justice for workers. At the same time it has negative implications on government, political parties & relevant stakeholders. Similar is the case with lockouts, Therefore strikes and lockouts should be refrained from and resolution of the dispute should be given utmost priority to avoid negative implication for all the stakeholders. Management should refrain from illegal lockdown and the same goes for union to avoid economic loss and to meet our economic goals.
1. Management of Kairbetta v/s Rajamanickam And Others, 1960 AIR 893.
2. Section 2(q), Industrial Disputes Act, 1947.
3. 2(1), Industrial Disputes Act, 1947.
4. 1963 AIR 569
5. Civil Appeal No. 91 of 1959.
6. Section 10, Industrial Disputes Act, 1947.
7. Section 22 and 23 of Industrial disputes Act, 1947.
8. Section 24, Industrial Disputes Act, 1947.
9. 1985 AIR 297.
10. (1957) ILLJ 90 Mad.
11. Section 22, Industrial disputes Act, 1947.
Questions covered by the Article
- What is a Strike?
- What is a Lockout?
- Implication of strikes for Union and management?
- Legal status conferred to lockdown?
- Implications of lockdown for the government?
 Management of Kairbetta v/s Rajamanickam And Others, 1960 AIR 893.
 Section 2(q), Industrial Disputes Act, 1947.
 2(1), Industrial Disputes Act, 1947.
 1963 AIR 569
 Civil Appeal No. 91 of 1959.
 Section 10, Industrial Disputes Act, 1947.
 Section 22 and 23 of Industrial disputes Act, 1947.
 Section 24, Industrial Disputes Act, 1947.
 1985 AIR 297.
 (1957) ILLJ 90 Mad.
 Section 22, Industrial disputes Act, 1947