Interim Report - Report No 284, November 1992

Case No 1591 (India) - Complaint date: 05-JUN-91 - Closed

1. 943. The National Confederation of Officers' Associations of Central Public Sector Undertakings (NCOA) presented a complaint against the Government of India alleging violations of freedom of association in a communication dated 5 June 1991.
2. 944. The Government sent certain observations on the allegations in a communication dated 12 August 1992.
3. 945. India has ratified neither the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87) nor the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. The complainant's allegations

1. 946. In its letter of 5 June 1991, the NCOA explains that it is an apex federation having 125 affiliated officers' associations representing over 150,000 managerial and supervisory staff employed in industrial and commercial undertakings owned by the Government of India. Its affiliates, and the complainant itself, are legal entities registered under either the Trade Unions Act, 1926 or the Societies Registration Act, 1860.
2. 947. First, the NCOA alleges that officers employed in public sector undertakings do not enjoy effective freedom of association despite article 19 of the Indian Constitution which lays down the basic right to associate of all citizens. According to the NCOA, the problem lies in the fact that such employees are excluded from coverage under the Industrial Disputes Act, 1947 because the definition of "workman" in that Act specifically excludes managerial and supervisory employees (section 2). This means that their registered organisations cannot receive official recognition for bargaining purposes. Moreover, any informal negotiations with public sector undertakings are illusory because the Government is in total control of all policy and decision-making (recruitmnt policy, conditions of service, wages and wage revision, financial policy) as regards such officers.
3. 948. The complainant gives an example of the refusal to recognise one of its affiliates at the Bharat Heavy Electricals Ltd. (BHEL). After action calling for recognition in the 1980s, the BHEL management finally agreed to a meeting with the BHEL Executives Federation in January 1989; the officers went on strike in May and October 1990 following which management agreed to a second meeting on 21 November 1990; for every Federation claim, the management refused meaningful dialogue (for example: on the issue of providing facilities for the association, it answered that it was not possible to give any office space; on the possibility of check-off of union dues, it answered that this was not feasible under present circumstances; on the creation of a grievance redressal system, it answered that the onus of preparing such a scheme rests with the Federation and not with management; on the issue of amending the promotion rules, it answered that the role of the Federation was envisaged as merely a "suggestion making body").
4. 949. Secondly, the NCOA alleges that in almost all public sector undertakings, office bearers of executive staff associations are victimised through such actions as denial of promotion, transfers, denial of work assignments and harassment. As there is no effective grievance machinery for such employees, the victims bear these measures in silence: the associations suffer a set back and then regroup.
5. 950. Thirdly, the NCOA alleges that since 1986 it has been calling for wage revision through letters, petitions, memoranda, protest rallies, sit-ins and strikes, but the Government and the undertaking managements refuse to enter into a dialogue, to announce a revised wage or to pay interest for the period during which the revision was delayed by the employers. The NCOA and several other (non-affiliated) associations of undertaking officers formed an informal coordination committee. This committee called for a nationwide 48-hour strike in July 1990 which led the Government through the Ministers of Finance and for Programme Implementation, to assure it that the wage revision would be settled by 31 August. When that promise was not honoured and the Ministers refused to meet the coordination committee, the latter launched a strike call for 11 October 1990. On 9 October the Minister for Programme Implementation requested that the strike be called off as the wage revision would be settled by the end of the year. The committee, however, decided to go ahead with the strike and the 200,000 officers involved were told that disciplinary action would be taken against them. In addition, the Government announced pay scale revision in only one undertaking where the strike had only been partially followed, and announced that it would expeditiously settle pay revision in those undertakings where officers had not taken part in the strike.
6. 951. Fourthly, the NCOA alleges that since its members are excluded from the Industrial Disputes Act they cannot use industrial tribunals, and since they do not occupy "civil posts" they are not accorded the constitutional protection which exists for government servants by virtue of article 311 of the Indian Constitution. A recent constitutional amendment led to the creation of special tribunals under the Administrative Tribunals Act, 1985, but even these cannot be used by the NCOA members since the Government has not extended coverage to them as required by that Act. Therefore, the only remedies available to such employees are judicial review (under the writ jurisdiction set out in the Indian Constitution) or the filing of a civil suit. But even there the writ jurisdiction is limited by the fact that it is discretionary and allows review on only jurisdictional issues, and the civil actions have the disadvantage of involving heavy court fees and invites - often after years of delay - only damages as a remedy. Specific performance as a remedy is not usually ordered in cases involving contracts of service.
7. 952. The complainant explains that attempts to introduce legislation to fill this gap in external dispute settlement machinery failed in 1978. Another Bill along these lines, entitled the Participation of Workers in Management Bill, has been pending in Parliament since 1990 without yet having been discussed. The NCOA provides an example of the lack of protection against arbitrary employment practices with the case of Dr. A. Gopalakrishnan, former Executive Director of BHEL. He was summarily dismissed from his important research and development post on the grounds that he was "uncooperative and unsuitable" to hold that position because he had criticised the running of his project, and he had no means of redress available to challenge that dismissal.

B. The Government's reply

1. 953. In a letter of 12 August 1992, the Government first states that every citizen of India has the fundamental right to form an association under the Constitution and, if there is a violation of this right by the State, remedy is available under article 32 and article 226 of the Constitution. A public sector enterprise is deemed to be a state under the Constitution for the purpose of the Chapter on Fundamental Rights, so an officer has the right to move the Supreme Court or a High Court for enforcement of his or her fundamental right to associate if it is abridged by the management of a public sector undertaking. There is no federal legislation on recognition of trade unions by the management. The Government has, however, issued broad guidelines regarding criteria for recognition of the officers' associations in public sector undertakings. These enterprises, being autonomous, are fully competent to decide the issue of recognition themselves in terms of rules they may have framed in this regard. It is true that the associations of officers have not been recognised by the management of certain public sector undertakings. There are, however, well-established mechanisms in almost all of them for regular informal consultations at the enterprise level. In addition many public sector undertakings have developed suitable schemes for redressal of grievances of staff not covered by the Industrial Disputes Act.
2. 954. The Government denies the allegation that the power of the employer is exercised by the Government in respect of the public sector undertakings. The boards of directors of such enterprises exercise their powers in accordance with the articles of association of the undertakings concerned. The Government has, however, prescribed some model pay scales in order to ensure uniformity of the scales in all public sector undertakings. Yet, it is the management of the enterprises which decides the wages and salaries of its employees, as well as other matters within the broad parameters prescribed by the Government. The Government therefore does not consider it necessary or expedient to negotiate with any federation or confederation of officers' associations of central public sector enterprises.
3. 955. According to the Government, the Industrial Disputes Act, 1947 seeks to provide special protection to the vulnerable section of the workers who are termed "workmen". Thus the workmen include even the supervisory staff who draw wages below a certain prescribed limit. As managerial staff are not included in the definition of "workmen" they do not come under the purview of the Industrial Disputes Act. But this absence of statutory provisions for settlement of industrial disputes does not mean that collective agreements cannot be made or enforced. The Government points out that pay revision for executives is made once in a period of four or five years. The Government, while laying down the broad parameters for revision of pay scales of executives in the public sector undertakings, takes account of the views expressed by the various officers' associations, the Confederation of Officers' Associations and the Executive Board of the Standing Conference of Public Enterprises. Specific proposals are formulated by the individual public sector undertakings in consultation with their respective officers' associations. It points out that the scales of pay of executives in 152 public sector establishments have already been revised as of 1 January 1987. Since the pay revision was getting delayed, two ad hoc advances were made effective from the last day of the previous period of settlement. Some of the public sector enterprises themselves have been giving more liberal advances subject to adjustments at the time of pay revision.
4. 956. Regarding the allegation of non-recognition by the Bharat Heavy Electricals Limited and the case of arbitrary dismissal of Dr. A. Gopalakrishnan by the same enterprise, the Government encloses the comments received from the management concerned. The Federation of BHEL Executive Associations went on strike on 16 and 17 February 1990 on the following demands: (i) pay scales to be revised immediately in line with the recommendations of the IVth Pay Commission for Government Employees; (ii) 30 per cent of pay to be paid as compensation for extra and hazardous working conditions; (iii) dearness allowance to match that offered by the central Government; (iv) pay scales to be effected from 1 January 1986; and (v) the pension scheme to be on par with that of central government employees. The Federation went on strike again on 29 May 1990, and 11 and 12 October 1990. The management held a meeting with it which amicably resolved the matter. The Government encloses a copy of a letter from the Federation thanking the BHEL Chairman for his efforts in taking care of the interests of the executive staff.
5. 957. As for Dr. A. Gopalakrishnan's case, the Government states that he held a top management post in BHEL. His performance and conduct were considered by the Board of Directors to be contrary to the interest of the company and his services were terminated by the Board by a letter dated 2 December 1986 which explained in detail the grounds for the termination of service. The action of the management was in accordance with the terms and conditions of appointment and Dr. Gopalakrishnan could have challenged the order in a High Court under the Constitution, but did not do so.

C. The Committee's conclusions

1. 958. The Committee notes that this case involves allegations that the lack of coverage in the Industrial Disputes Act of supervisory and managerial staff employed in public sector undertakings has meant that they are denied (i) recognition rights for collective bargaining purposes; and (ii) protection against arbitrary employment practices. As the complainant does not provide details on the allegations of unfair practices, the Committee requests the complainant to provide such information so that it will be in a position to examine this aspect of the case.
2. 959. As regards the denial of the right to associate and to bargain collectively of supervisory and managerial staff, the Committee considers, as does the Committee of Experts on the Application of Conventions and Recommendations, that such provisions are generally designed to prevent interference by employers in trade union activities and to avoid conflicts of interest involving managerial staff. Forbidding these persons to join trade unions representing other workers is not necessarily incompatible with freedom of association, but only on two conditions: first, that they have the right to form their own organisations to defend their interests and, second, that the categories of managerial staff and employees in positions of confidence are not so broadly defined that the organisations of other workers in the enterprise or branch of activity are weakened by depriving them of a substantial proportion of their present or potential membership (General Survey on Freedom of Association and Collective Bargaining, 1983, para. 131).
3. 960. The Committee accordingly hopes that the Bill which attempts to rectify the legislative position of this type of supervisory and management staff (which has been before Parliament since 1990) will address the above concerns. The Committee asks the Government to keep it informed of the progress of the Bill, and to supply a copy of it once promulgated.

The Committee's recommendations

1. 961. In the light of its foregoing interim conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) The Committee requests the complainant to provide detailed information on the allegations of unfair practices, which were allegedly taken against supervisory and managerial staff, so that it may examine this aspect of the case.
   • (b) The Committee hopes that the draft Act which purports to rectify the situation of supervisory and managerial staff will take into account the principles stated above as regards the rights of this category of employees.
   • (c) The Committee asks the Government to keep it informed of the progress of the Bill, and to supply a copy of it once promulgated.