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Definition, Registration and Recognition of Trade Union

Collective bargaining is the principal raison d'etre of trade unions. However, to see that the trade union, which literally takes up the matter concerning the workman or relating to service conditions therein, truly represents the workman employed in an establishment, what is first required is to get the trade union itself registered under the Trade Union Act 1926. The registration gives the trade union a stamp of due formation and recognition in the eyes of the law as well as in the mind of the employer, which stipulates that the trade union is an authenticated body.

Kinds of Trade Unions

The Trade Union Act 1926 literally recognised only one kind of trade union. Although, in larger contrast, trade unions can be divided into three kinds, i.e.,
  1. Registered trade union
  2. Unregistered trade union
  3. A trade union recognised by the employer
Notably, the act explicitly concerns a registered trade union. Section 3 of the act provides for the appointment of a registrar for the purpose of registration therein.

Section 2(h) of the Trade Union Act 1926 provides the definition of trade union, which can be understood in simple terms as follows:

Trade union means "any combination" (whether temporary or permanent).
  • Formed "primarily" for the purpose of regulating the relationship between workmen and employer
  • Workmen and workmen
  • Employers and employers
  • formed for imposing restrictive conditions on the conduct of any trade or business.
  • includes any federation of two or more trade unions.
In National Organization of Bank Worker's Federation of Trade Union vs Union of India[i], the high court ruled that a federation is not a trade union in accordance with Section 2(h) of the Trade Union Act 1926, if it is not a registered organization under this Act.

However, the definition doesn't include affecting the "agreement"
  1. Between partners as to their own business
  2. An employer and those employed by him as to such employment
  3. In consideration of the sale of the goodwill of a business or of instruction in any profession, trade, or handicraft

Registration of a Trade Union

Registration of a Trade Union is compulsory but desirable since a registered trade union enjoys certain rights and privileges under the act. Members of a trade union are also granted certain advantages and immunities.

Section 4 of the act provides provisions for modes of registration. This section stipulates that for the purpose of registering a trade union, there should be a minimum of seven members. The reason behind the fixation of a minimum of seven members is to encourage the formation of more and more trade unions that will be a countervailing force to counteract the inequality of bargaining power that is inherent and must be inherent in the employment relationship. In order to summarise, Section 4 of the Act talks about two conditions required to fulfil the registration of a trade union, which are as follows:
  • The requirement of seven or more members as signatories connected therewith
  • Provided that there are 100 or 10%, whichever is less, employed in the industry or establishment
Notably, section 4(2) of the Act provides that the application for registration may become invalid if more than half of the applicants have ceased to be members of the trade union or have dissociated themselves from the application. The provision affects the application as invalid at any stage but before the registration of the Trade Union.

Apart from the requirements under section 4, the Act also prescribed the particulars under section 5 and section 6. These are as follows:

the names, occupations, and addresses of the members making the application in the case of a Trade Union of workmen, the names, occupations and addresses of the places of work of the members of the Trade Union making the application the name of the Trade Union and the address of its head office; and the titles, names, ages, addresses and occupations of the 4 [office-bearers] of the Trade Union.

Further, section 7 provides that, the registrar may call for further particulars or information for the purpose of satisfying himself that the application is complete. Notably, the said particulars called by the registrar, if not supplied to him by the applicant, empower the registrar to refuse (not reject) to register the trade union until the particulars supplied or alteration has been made. In the case of In re Inland Steam Navigation Worker's Union[ii] it was held that the registrar must register the trade union in case all the requirements are fulfilled.

No one can deny the right to get registered unless reasonable grounds are presented for the same. The duties of the registrar are to examine the application for registration and to look into the objects for which it is seeking registration. If those objects are objects set out within the act, then it is the duty of the registrar to register the Trade Union.

In Rangaswami and Another vs Registrar of Trade Unions and Another[iii] the High Court clarified that, mere surplus produced by an establishment but whose services are purely of a personal nature which is otherwise not a commercial undertaking, and the person employed therein, seeking registration of a trade union, would not sustain. Since the person employed therein could not be considered a 'workman' within the meaning of the act.

Although the act has not explicitly defined the term 'workmen', it has used the term to define the 'trade dispute' within the meaning of the act. Simply put, a person to be called a workman must be employed in trade and industry.

It means it requires the person to be employed in a commercial undertaking. It has been further clarified that the definition of 'workmen' provided in the Industrial Dispute Act 1947 would not suffice under the Trade Union Act because if it applies, the purpose of the Trade Union Act 1926 will be obliterated.

Legal status of a Trade Union (registered or unregistered)

A trade union might be registered or unregistered. It's totally up to the discretion of the members of the trade union whether to register it or not. Although, as discussed above, registration gives certain benefits to a trade union, which would otherwise make it compulsory to register. But the act does not make it prima facie compulsory.

An unregistered trade union has no manner of right whatsoever and the rights available under the Industrial Disputes Act, 1947, have been limited only to those trade unions that are registered under the Trade Unions Act, 1926. An unregistered trade union may function as a normal trade union defined under the Trade Unions Act 1926; an unregistered trade union neither has the power to raise an industrial dispute nor the power to represent an employee or be part of any proceedings under the Industrial Disputes Act.

An unregistered trade union is also incapable of entering into a contract with the employer on behalf of the members or employees, and if it does so, the enforcement of the same by such an association or union in its name may not be possible. While registered trade unions enjoy several rights, the same cannot be said for unregistered unions.

The unregistered trade unions, per se, have no rights except to represent their members. Notably, in cases where the union has a considerable number of workmen as its members, they can raise industrial disputes and put forth their negotiations.

On the other hand, once a trade union gets registered, it is entitled to receive certain rights and privileges, which are as follows:
  1. A registered trade union is a body corporate with perpetual succession and a common seal.
  2. It can acquire, hold, sell, or transfer any movable property and can be a party to a contract.
  3. It can sue and be sued in its own name.
  4. No civil suit or other proceeding can be initiated against a registered trade union in respect of any act done in furtherance of a trade dispute under certain conditions.
  5. Its office bearer or member cannot be prosecuted for criminal conspiracy for following its legitimate objects.

Law is a technique for the regulation of social power, and the principal purpose of labour law is to regulate, support, and restrain the power of management (commanding power) and the power of organised labour (subordination with bargaining).

The relationship between the employer and an isolated employee or worker is typically a relationship between a bearer of power and one who is NOT bearer of power. The main object of the Labour Law is to countervailing force to counteract the inequality of bargaining power, which is inherent and must be inherent in the employment relationship.

  1. 1993 IILLJ 537 Bom
  2. AIR 1936 Cal 57
  3. AIR 1962 Mad 231
Written By: Ahsan Sanjar (Final Year Law Student at Campus Law Centre, University of Delhi)

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