Industrial Relations (IR) is a fundamental concept and a field of study that examines the complex web of interactions and relationships between employers, workers, and their representative bodies, such as trade unions, within the workplace. The goal of IR is to maintain industrial harmony, ensure productivity, and facilitate the fair distribution of profits.
The legal framework for IR in India was historically centered on the Industrial Disputes Act, 1947 (IDA), which was enacted post-independence to provide a mechanism for the investigation and settlement of labour disputes. This Act, along with the Trade Unions Act, 1926, and the Industrial Employment (Standing Orders) Act, 1946, formed the core of the system.
The system has recently undergone a massive overhaul with the enactment of the Industrial Relations Code, 2020 (IRC, 2020), which received Presidential assent in September 2020 and replaced the three aforementioned Acts. The IRC, 2020, is one of the four new Labour Codes, connecting IR to the Code on Wages, 2019, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020.
The IRC, 2020, works by introducing several key mechanisms: it increased the threshold for mandatory government approval for lay-off, retrenchment, or closure from 100 to 300 workers. It also raised the threshold for industrial establishments to frame mandatory Standing Orders from 100 to 300 employees. The Code formalised collective bargaining by mandating the recognition of a Negotiating Union (with 51% membership) or a Negotiating Council. Furthermore, it requires a 14-day notice before any strike or lockout and expanded the definition of a "strike" to include collective casual leave by 50% or more workers. The Code also abolished the system of Labour Courts, consolidating all adjudication at the Industrial Tribunal level. The term "workman" was also replaced with the gender-neutral term "worker".