Standing Orders under Industrial Relations Code,2020: Explained

The Author, Sahil Verma is a 4th-year student of Btech in CSE and LL.B. in Cyber Law at UPES, Dehradun.

INTRODUCTION

The standing orders are defined under section 2 (zm) of the Industrial Relations Code 2020 as, “orders relating to matters set out in the First Schedule”. As regards the First Schedule, it states eleven matters which are as follows:

1. Classification of workers;
2. Mechanism of intimidating attendance, wage rates, etc;
3. Shift working;
4. Attendance and late coming;
5. Conditions and procedure for leave application;
6. Requirement to enter premises by certain gates, and liability to search;
7. Non-functioning of certain areas and related rights and liabilities;
8. Conditions relating to termination;
9. Misconduct related provisions;
10. Mechanism for redressal;
11. Any matter notified by the appropriate government.

HISTORY OF STANDING ORDERS

The parliament passed the Industrial Employment (Standing Orders) Act, 1946, to organise industrial establishments by requiring employers to submit standing orders that would lay out the working conditions of the employees. By the Act, the central government also issued the Industrial Employment (Standing Orders) Central Rules, 1946. If an employer violates these rules, the employee can have it enforced through the Labour Court or Industrial Court. However, the Act stated that only industrial companies with a hundred or had a hundred workers (changed to three hundred by the Industrial Relations Code, 2020) on any day of the year would be required to create standing orders. The provisions relating to standing orders have changed since the enactment of the Industrial Relations Code, 2020. The former law's provisions have now been included in the Industrial Relation Code and are addressed in Chapter IV of the Code, Sections 28 to 39. 

CERTIFIED STANDING ORDERS

In the case of Certified Standing Orders, the employer drafts a standing order based on the First Schedule, which is subsequently delivered to the Certifying Officer for certification. If the draft standing order is successfully certified, it becomes effective in the industrial establishment. The certification process takes some time, and in the meantime, the model standing orders are made applicable by Section 29. (2). Nonetheless, the Code states that any industrial establishment may adopt the model standing orders and notify the Certifying Officer by Section 30(3) of the Code. The Central Government prepares these model standing orders by Section 29(1) of the Code.

PROCESS FOR CERTIFICATION

Section 30 of the Code details the method for certifying standing orders. The steps are as follows:

• The employer shall develop a draft standing order by the First Schedule and the provisions of the Code, taking into account any comments from trade unions or employee representatives.
• He must then send the drafted standing order to the Certifying Officer, either electronically or in any other manner specified.
• On receipt of the drafts, the Certifying Officer shall forward them to trade unions or employee representatives and, if necessary, make appropriate changes within sixty days.
• If the Certifying Officer does not protest within the specified time frame, the drafted standing order is presumed to have been certified and is enforced at the business.
• Furthermore, an industrial establishment may choose to use the model standing order, in which case the employer must notify the Certifying Officer, and such model standing order will be regarded to be the establishment's certified standing order if approved by the Certifying Officer (who can also make certain modifications).

PROCEDURE FOR AMENDING STANDING ORDER

The process of making changes to the standing order is defined in Section 30(4) of the Code. The process for revisions is the same as described above for drafting standing orders:

1. The employer offers the drafts to the certifying officer.
2. The certifying officer then considers proposals from trade unions and representatives.
3. The approval or rejection of the modifications is done.

REMEDIES FOR EMPLOYER AFTER REJECTION

If the employer's requested modifications are denied, he has various options, which are as follows: 

1. Appeal

The employer's first and most basic remedy is to submit an appeal with the appellate authority under Section 32 of the Code. If the employer is dissatisfied, he may "submit an appeal to the appellate authority constituted by the competent Government, by notification, within sixty days of receipt of the order of the certifying officer, and such authority shall dispose of the appeal in such way as may be stipulated." The appellant must prepare a memorandum of appeal in tabular format, including the original provisions and proposed modifications, and file it electronically with the authority within sixty days of receiving the order of the Certifying Officer, according to Rule 12 of the Draft Industrial Relation (Central) Rules, 2020.

2. Independent application 

Furthermore, if the appeal is unsuccessful, the employer may produce a new draught and resubmit it to the Certifying Officer using the same method, claiming that circumstances have changed. The Supreme Court of India reached the same conclusion in the case of Management Shahdara (Delhi) Saharanpur light Railway Co., Ltd vs. S.S. Railway Workers' Union (1969). It was decided that, while the decision of the appellate body could not be disputed in civil court, the aggrieved party could make a new application to the Certifying Officer.

3. Agreement between concerned parties

The employer may reach an agreement with the employees, their representatives, or trade unions to achieve the needed changes. Section 35 requires a six-month break between any proposed alterations; alternatively, the employer and employees must reach an agreement in which only the modifications can take effect. As a result, if the parties agree, they may create an agreement and propose changes to the Certifying Officer while keeping Section 35 of the Code and Rule 15 of the Draft Industrial Relation (Central) Rules, 2020 in mind.

FINALITY OF THE DECISION OF THE APPELLATE AUTHORITY

The appellate authority's ruling is final and binding. The earlier Act on standing orders expressly specified that the decision of the appellate body was final and that no recourse could be taken in civil court. However, Section 32 of the Code, which deals with the appeal and its disposition by the appellate authority, does not state that the authority's judgement is final. "Such authority shall dispose of the appeal in such way as may be prescribed," it says. Even when referring to the draft guidance, there is no mention of such a decision being final.

Section 97 of the Code, on the other hand, provides that "no civil court shall have jurisdiction in respect of any issue to which any provision of this Code relates, and no injunction shall be obtained by any civil court in respect of anything done or intended to be done by or under this Code." As a result, this provision can be read to mean that the decision of such appellate authority is final. Nonetheless, it was established in the Management Shahdara case that such an appellate body may examine and amend its decision if it believes it appropriates on the grounds of justice and reasonableness, even if there is no change in circumstances.

NATURE OF CERTIFIED STANDING ORDERS

• Rights and duties of employee and employer

The most fundamental characteristic of the certified standing order is that it establishes the rights and duties of the employer and employees while they are on the job. It takes into account all of the items listed in the First Schedule and so establishes their responsibilities to one another during the term of employment.

• Binding effect

When standing orders are certified, they become legally binding on both the employer and the employee. All of the terms included in the approved standing orders, such as wage payment, payment mechanism, shifts, categorization of employment, and so on, must be observed by both the employer and the employee. In the event of non-compliance, either the employer or the employee may seek redress through the Industrial Tribunal, as specified in the Code.

According to the decision in Premier Automobiles Ltd. vs. Kamlekar Shantaram Wadke of Bombay & Ors. (1976), the Industrial Employment (Standing Orders) Act of 1946 and the Industrial Disputes Act of 1947 are sister acts (now part of the same code), and recourse can be taken under the latter act if the former does not provide for any mechanism. As a result, approved standing orders are binding on both the employer and the employees and can be enforced through the Industrial Tribunal in the event of noncompliance. Because the two acts are now part of the same statute, enforcement will be straightforward.

• Conformity with Model Standing Order, First Schedule, and Industrial Relations Code

The approved standing orders must adhere to the First Schedule, which lists the eleven subjects on which the standing orders must be founded. Furthermore, it should be consistent with the model standing orders prepared by the central government by Section 29(1) of the Code. Finally, certified standing orders are always issued by the Industrial Relations Code, 2020.

• Imposition of a statute

The certified standing orders have the form of statutory imposition. They are not, however, to be understood as statutory provisions, and so are not to be considered legislation. In Rajasthan State Road Transport Corporation v. Krishna Kant (1995), it was determined that "the certified Standing Orders made under and in conformity with the Industrial Employment (Standing Order) Act, 1946 are statutorily imposed terms of service and are enforceable both upon the employers and employees, though they do not equal to statutory requirements."

• Fair and reasonable

The certified standing orders must be fair and reasonable at all times. The Certifying Officer is required by Section 30(7) to "adjudicate on the fairness or reasonableness of the terms of any standing orders in light of the provisions of the model standing orders."

• Overriding effects

The courts have confirmed numerous times that certified standing orders have precedence over any agreement, such as a letter of appointment if the latter is opposed to the former. The Supreme Court ruled in Western India Match Co. Ltd. v. Workman (1973) that if there is any conflict between certified standing orders and an agreement, the former will take precedence over such elements of the contract of employment, because certified standing orders have the power of law, whilst an agreement has no legal sanction. This was restated by the Rajasthan High Court in the case of Eicher Goodearth Ltd. v. Rajendra Kumar Soni and Others (1993), in which the High Court held that a certified standing order has the authority to override a letter of appointment where there was an inconsistency between the two in probation provisions.

• Penalty for non-compliance

Section 86(11) of the Code states that an employer might be fined between one and two lakh rupees if he fails to comply with the final approved standing order.

CONCLUSION  

The provisions governing standing orders have been significantly altered by the Industrial Relations Code of 2020. Unlike before, an employee can now seek relief under the same legislation as a result of the consolidation of the three Acts. In terms of the appellate authority's decision's finality, such a decision is final, and there is no legal remedy available against such an order. Overall, the effect of the Industrial Relations Code on India's Standing Orders scheme is positive, with the main concern centred on the threshold established by the Code [section 22]. However, there are concerns about applying this Chapter to all enterprises that fall within the broadly defined concept of industry. Several stakeholders in the IT industry, for example, protested the use of standing orders, claiming that the industry's work conditions were substantially regularised and offered employees major benefits. Stakeholders such as labour unions, on the other hand, argued that implementing standing orders would result in the establishment of a common set of minimum working conditions.