Over the years, trade unions have emerged as an essential feature of industry in almost every country. In the early stages of industrialisation, there was lack of legal protection for workers which resulted in exploitation of workers by their employers, leading to social injustice. Often the employers had the upper hand in deciding the terms of employment of the workers which is benefitable to the employers and not the workers. This led the workers in forming groups or unions, in order to put forward their demands to their employers. The need for an organized trade union was first realized in 1875 by various philanthropists and social workers like Shri Sorabji Shapaji Bengali and Shri N.M. Lokhandey whose constant efforts resulted in the formation of trade unions like The Printers Union of Calcutta (1905), the Bombay Postal Union (1907).
The Trade Union Act, 1926 provides for the registration of Trade Unions in India and in certain respects to define the law relating to registered Trade Unions of India. The main objective of the Trade Unions Act is to provide recognition of trade union for facilitating collective bargaining for certain undertakings. The act helps the various trade unions to raise up their issues to the employer and thus also lists out their rights and obligations. If you are an employer, you must have conversed with the union leaders or representatives for various issues.
This act extends to the whole of India. A trade union can only be registered under the Trade Unions Act, 1926, and cannot be registered under any other act including the Societies Registration Act or the Co-operative Societies Act or the Indian Companies Act. A Civil Servants’ Union cannot be registered under the Trade Unions Act, 1926. In the case of Tamil Nadu N.G.O Union vs. The Registrar of Trade Unions (AIR 1962, Mad. 2341), the Madras High Court dismissed the appeal on the ground that, to get the trade union registered under the Trade Unions Act, 1926, the members of the union must be workmen engaged in trade, business or industry and the appellants in this case are not in that capacity, as they are civil servants engaged in the tasks of the sovereign government.
Thus, this act empowers all employees/workmen employed in an establishment to form a union and get it registered under the act. It is to note that there are various stare amendments to this central act. For example, in Maharashtra, there is Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices (MRTU & PULP) act, 197. This act lists out the various process for recognition of a trade union originating in the state in Maharastra.
Importance for Pvt Companies etc.
The Trade Union Act plays an important role in an employer’s business or company or establishment. For every employer in order to keep his business in a running condition, he must consider the various requests from its workers or employees. Good relations between the employer and the workers boosts the productivity and quality of the business. While it is important for the employer to know about his workers demands and requests, the workers too shall be well aware of the employer’s ability to fulfil such demands or requests.
The act gives power to the employees to form a union and put forward their views regarding the terms of employment and other issues in front of the management of the company or establishment. Imagine you are an employer and have 50-60 employees working in your establishment. Majority of the employees have some or the other issues related to their term of employment and they come to you for a settlement. Being an employer, it would be a difficult task to pay attention to the same kind of issues which concerns the employees and thus, it’s always better to address those issues when the employees’ approach in group. An employer having a registered trade union in his establishment would result in less employer-employee conflicts. It would also enable the workers to enter the process of collective bargaining with the employer for resolving trade disputes in the establishment.
Thus, for any private limited company, generating profit is the most important objective. Employees or workers acts like the building blocks of the company and thus it is important for an employer to know about his employee’s interests.