THE TRADE UNIONS ACT, 1926

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 INTRODUCTION
• The Trade Unions Act, 1926 provides for registration of trade unions (including association of
employers) with a view to render lawful organisation of labour to enable collective bargaining.
• The Act applies to registered trade unions.
• It extends to whole of India including Jammu & Kashmir.
• Section 14 of the Act provides that the following Acts shall not apply to the registered Trade Unions
(i) The Societies Registration Act, 1860,
(ii) The Societies' Act 1912, and
(iii) The Companies Act.

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 INTRODUCTION

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Scheme of Trade Union Act, 1926

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 Definitions
• Section 2(a): “executive” means the body, by whatever name called, to which the management of
the affairs of a Trade Union is entrusted
• Section 2(b): “office-bearer” in the case of a Trade Union, includes any member of the executive
thereof, but does not include an auditor
• Section 2(e): “registered Trade Union” means a Trade Union registered under this Act;
• Section 2(g): “trade dispute” means any dispute:
➢ between employers and workmen or
➢ between workmen and workmen, or
➢ between employers and employers
➢ which is connected with the employment or non-employment, or the terms of employment or the
conditions of labour, of any person, and
➢ “workmen” means all persons employed in trade or industry whether or not in the employment
of the employer with whom the trade dispute arises.

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 Trade Union [Section 2(h)]
“Trade Union” means any combination,
• whether temporary or permanent,
• formed primarily for the purpose of regulating the relations
• between workmen and employers or between workmen and workmen, or between employers and
employers, or for imposing restrictive conditions on the conduct of any trade or business, and
• includes any federation of two or more Trade Unions.

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 Registration of trade unions (Chapter 2)
• Under the Trade Unions Act. 1926. the registration of trade unions is not mandatory but it is
discretionary. Practically. it necessary that a trade union shall be registered.
• Section 3 of the Act empowers the appropriate government to appoint a person as the registrar of a
trade union.
• According to the Section 4, any seven or more than seven members of a trade union may by
application apply for the registration of the trade union.
• According to Section 5 of the Act, every application for a trade union’s registration must be
presented in writing to the Registrar and include a copy of the union’s rules alongwith
statement containing details of members, office-bearers and address of union.
• Section 7 of the Act confers upon the registrar the power to call for information in order to satisfy
himself that any application made by the trade union is in compliance the Act.
• According to Section 8 of the Act, if the registrar has fully satisfied himself that a union has
complied with all the necessary provisions of the Act, he may register such a union by entering in
a register.
• According to Section 9 of the Act, the registrar shall issue a registration certificate to any trade
union which has been registered under the provisions of Section 8 of the Act.

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 Section 6 : provisions to be contained in the rules of a trade union
• Name of the trade union;
• The object of the establishment of the trade union;
• Purposes for which the funds with the union shall be directed;
• A list specifying the members of the union shall be maintained.
• The procedure by which the rules can be amended, varied or rescinded;
• The manner within which the members of the manager and also the alternative workplace bearers of
the labour union shall be elected and removed;
• The safe custody of the funds of the labour union, an annual audit, in such manner, as may be
prescribed, of the accounts thereof, and
• adequate facilities for the inspection of the account books by the workplace bearers and members of
the labour union, and;
• The manner within which the labour union could also be dissolved.

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 Section 9A : minimum requirement related to the membership of a trade union

• Section 9A of the Act lays down the minimum number of members required to be present in any
union which has been duly registered.
• This Section mandates that a trade union which has been registered must at all times continue to
have not less than 10% or one hundred of the workers, whichever is less, subject to a minimum of
seven, engaged or utilised in an institution or trade with which it’s connected.

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 Section 10 : cancellation of registration
The registrar, according to Section 10 of the Act, has the power to withdraw or cancel the registration
certificate of any union in any of the following conditions:
• On an application made by the trade union seeking to be verified in such manner as may be
prescribed;
• If the registrar is satisfied with the fact that the trade union has obtained the certificate by means of
fraud or deceit;
• If the trade union has ceased to exist;
• wilfully and after notice from the Registrar contravened any provision of this Act;
• If any union has rescinded any rule provided under Section 6 of the Act.
Provided that not less than two months' previous notice in writing specifying the ground on which it
is proposed to withdraw or cancel the certificate shall be given by the Registrar to the Trade Union
before the certificate is withdrawn or cancelled otherwise than on the application of the Trade Union.

Section 11 (Appeal): Any person aggrieved by any refusal of the Registrar to register a Trade Union or
by the withdrawal or cancellation of a certificate of registration may, within such period as may be
prescribed, appeal to the court.

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 Section 12 : registered office
• Section 12 of the Act lays down that all communications and notices to any trade union must be
addressed to its registered office.
• If a trade union changes the address of its registered office, it must inform the registrar within the
period of fourteen days in writing, and the registrar shall record the changed address in the
register.

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 Rights and liabilities of registered trade unions
• Chapter Ill of the Trade Unions Act,1926 enumerates the rights and liabilities of a registered trade
union. Certain rights and obligations are imposed on them by the fact of registration.
• A registered trade union has the right to maintain.
(1) A general fund. and
(2) A separate fund for political purposes.

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 Section 15 : objects on which general funds may be spent
• Salaries are to be given to the office-bearers.
• The cost incurred for the administration of the trade union.
• Compensation to the workers due to any loss arising out of any trade dispute.
• Expenses incurred in the welfare activities of the workers.
• Benefits are conferred to the workers in case of unemployment, disability, or death.
• The cost incurred in bringing or defending any legal suit.
• Publishing materials with the aim of spreading awareness amongst the workers.
• Education of the workers or their dependents.
• Making provisions for medical treatment of the workers.
• Taking insurance policies for the welfare of the workers.

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 Section 16 : constitution of a separate fund for political purposes
• Section 16 provides that a trade union, in order to promote the civic and political interests of its
members, can constitute a separate fund from the contributions made separately for the said
purposes.

• No member of the union can be compelled to contribute to the fund.

• A recognised trade union is not allowed to use its general finances for its members’ political
campaigns. The trade union must establish a separate political fund for political causes.

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 Rights
Section 13 of the Act states that every trade union which is registered according to the
provisions of the Act shall:
• Be corporate by the name under which it is registered.
• have perpetual succession and a common seal.
• Power to contract and hold and acquire any movable and immovable property.
• By the said name can sue and be sued.
• Section 17 of the act grants immunity from criminal conspiracies to the office-bearer or member
of a registered trade union under Indian Penal code in respect of any agreement made between the
members.
• Section 18 of the Act immunises the members of trade unions from civil or tortious liabilities
arising out of any act done in furtherance or contemplation of any trade dispute.
• Under Section 19 of the Trade Unions Act, 1926, any agreement between the members of a
registered trade union in restraint of trade activities is neither void nor voidable.
• According to Section 20 of the Act, the account books and the list of the members of any
registered trade union can be subjected to inspection by the members of the trade union.

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 Rights of Minors to become Members
• Section 21 provides that a person who is above 15 years of age can be a member of any trade
union, and if he becomes a member, he can enjoy all the rights conferred upon the members of the
trade union.

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 Office-Bearers
• Section 22 of the Act mandates that not less than half of the office-bearers of the trade union
should be employed in the industry or work with which the trade union is connected.
• Under Section 21A, a person shall be disqualified for being chosen as, and for being, a member of
the executive or any other office-bearer of a registered Trade Union if—
(i) he has not attained the age of eighteen years;
(ii) he has been convicted by a Court in India of any offence involving moral turpitude and
sentenced to imprisonment, unless a period of five years has elapsed since his release.

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 Change of Name / Amalgamation / Dissolution
• Section 23 states that any registered union is free to change its name provided it does so with the
consent of not less than 2/3rd of its members.
• Section 24 lays down that two or more trade unions can join together and form one trade union
with or without dissolution or division of the fund.
• Section 25 provides that a notice in writing of every change of name and of every amalgamation
which is duly signed by the Secretary and by seven members of the Trade Union should be sent to
the Registrar.
• Section 27 states that if a registered trade union has been dissolved, a notice of such dissolution
which must be signed by seven members and by the Secretary of the Trade Union should be served
to the registrar within 14 days of such dissolution.

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 Section 28 : returns
Section 28 provides that each trade union should send the returns to the registrar annually on or
before such a day as may be prescribed by the registrar. The return includes:
• General statement
• Audit report
• All the receipts and expenditures incurred by the trade union
• Assets and liabilities of the firm on the 31st day of December

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 Regulations
• Section 29 and Section 30 of Chapter 4 of the Act lays down the regulations which shall be
imposed on the trade union.
• Section 29 of the Act confers the right on the appropriate government to make provisions in
order to ensure that the provisions of the Act are fairly executed.
• The regulations which are made must be specified in the official gazette of India and it shall
have the effect of an enacted law. (Section 30)

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 Penalties
Failure to submit returns (Section 31)
• If default is made on the part of any registared Trade Union in giving any notice or sending any
statement or other document as required by or under any provision of this Act, every office-
bearer or, if there is no such office-bearer, every member of the executive of the Trade Union, shall
be punishable with fine which may extend to five rupees and, in the case of a continuing default,
with an additional fine which may extend to five rupees for each week.
• Any person who wilfully makes, or causes to be made, any false entry in, or any omission from,
the general statement required by section 28, or in or from any copy of rules or of alterations of
rules sent to the Registrar under that section, shall be punishable with fine which may extend to five
hundred rupees.

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 Penalties
Supplying false information regarding Trade Unions (Section 32)
• Any person who, with intent to deceive, gives to any member of a registered Trade Union or to
any person intending or applying to become a member of such Trade Union
• any document purporting to be a copy of the rules of the Trade Union or of any alterations to the
same which he knows, or has reason to believe, is not a correct copy of such rules or alterations as
are for the time being in force, or
• any person who, with the like intent, gives a copy of any rules of any unregistered Trade Union to
any person on the pretence that such rules are the rules of a registered Trade Union,
• shall be punishable with fine which may extend to two hundred rupees.

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 CONCEPT CHECK QUESTION
Q. Which section of Trade Unions Act, 1926 defines trade union?

a) Section 2(a)

b) Section 2(b)

c) Section 2(d)

d) Section 2(h)

Solution – d)

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 THANK YOU

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