Immunity From Civil Liability.pptx

Immunity from Civil Liability Section 18 of TU Act

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18. Immunity from civil suit in certain cases.—

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(1) No suit or other legal proceeding shall be maintainable in any Civil Court against any registered Trade Union or any office-bearer or member thereof in respect of any act done in contemplation or furtherance of a trade dispute to which a member of the Trade Union is a party on the ground only that such act induces some other person to break a contract of employment, or that it is in interference with the trade, business or employment of some other person or with the right of some other person to dispose of his capital or of his labour as he wills.

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(2) A registered Trade Union shall not be liable in any suit or other legal proceeding in any Civil Court in respect of any tortious act done in contemplation or furtherance of a trade dispute by an agent of the Trade Union if it is proved that such person acted without the knowledge of, or contrary to express instructions given by, the executive of the Trade Union.

Conditions The conditions for such protection against any civil suit or other legal proceedings are: 

A registered TU

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Persons seeking immunity must be members or officebearers of the TU

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A trade dispute, either existing or contemplated

Conditions 

Specific grounds for the protection are: 

Act of inducement,

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Procurement or

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Interference must be by lawful means and not by means which would be illegal or wrongful by other provisions of law.

Thus if acts done in furtherance of a trade dispute involve any violence, etc. then the immunity will no longer be available.

Cases: Rohtas Industries Staff Union v State of Bihar AIR 1963 Pat 170 

Facts: A dispute between the Union and the employer arose, which was submitted for arbitration.

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Later arbitrator gave the award, which stated that the workers who had gone for strike will pay compensation to the Rohtas Industries Ltd. and Ashoka Cement Works as the strike was illegal.

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The Union went in appeal in Patna High Court, which decided that arbitrator had committed error of law in holding that workers were not protected by S. 18(1) of the TU Act.

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As per arbitrators reason for strike was nonimplementation of Jee Jee Bhoy’s award regarding payment of wages to casual workers.

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Arbitrators stated that the strike was illegal as its object was ulterior. It did not specify the ulterior motives.

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In this case the Court referred to Lord Cave’s decision in Sorrel v Smith, who gave two propositions of law which are:

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(1) A combination of two or more persons willfully to injure a, man in his trade is unlawful and, if it results in damage to him, is actionable.

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(2) If the real purpose of the combination is, not to injure another, but to forward or defend the trade of those who enter into it, then no wrong is committed and no action will lie, although damage to another ensues.

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The distinction between the two classes of case is sometimes expressed by saying that in cases of the former class there is not, while in cases of the latter class there is, just cause or excuse for the, action taken.

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The Court also referred to Lord wright in Crofter Hand-woven, Harris Tweed Co. v. Veith (1942):

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In commercial affairs, each trader's rights are qualified by the right of others to compete. Where the rights of labour are concerned, the rights of the employer are conditioned by the right of the men to give or withhold their services. The right of workmen to strike is an essential element in the principle of collective, bargaining.

Predominant Purpose Test: 

It is enough to say that, if there is more than one purpose actuating a combination, liability must depend on ascertaining the predominant purpose. If that predominant purpose is to damage another person and damage results, that is tortious conspiracy. If the predominant purpose is the lawful protection or promotion of any lawful interest of the combiners, it is not a tortious conspiracy, even though it causes damage to another person.

Observation of the Court 

What is important in such case is whether the predominant purpose of the workmen was in contemplation or furtherance of trade dispute?

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Illegality of a strike is decided under S. 24(1) of the ID Act.

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Illegality or legality of a strike has no bearing on the question of immunity provided under S. 18(1).

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The demonstrators are protected as long as they are peaceful and do not turn violent.

Decision 

Court issued writ of Certiorari (review of order of lower court by High Court) against the arbitrators and held their award as illegal and ultra vires i.e. the award of compensation to employer by the workmen for the strike.

Common Cause v Union of India (1996) 1 CCC 24 (NCDRC) 

The members of the Indian Flight Engineers Association went on a strike for about six weeks, in which air passengers were put to great amount of inconvenience. The suit was filed against members of the Association and Air India for compensation.

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The Association contended that the strike was regarding a labour dispute between the Association and Air India and no consumer complaint can legally arise out of such agitation launched by a trade union, as Section 18 provides immunity against such civil action.

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The Union of India contended that the strike was illegal as there was no prior notice and the strike was declared as illegal by the Ministry of Labour, Govt. of India.

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The Court held that the strike was illegal and was not covered under S. 18. as the Association went on strike on the ground that some of their demands were not satisfactorily heard by the Air India.

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It further stated that the strike was resorted to when there was a reference pending regarding those demands before the National Industrial Tribunal for adjudication and conciliation.

Standard Chartered Bank v Chartered Bank Employees’ Union (1997) 68 DLT 391

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The plaintiff filed the suit for perpetual injunction against the workers’ union from restraining them for demonstrating within 500 meters of radius of the Bank.

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The Delhi High Court decided that the restriction must be imposed regarding demonstration within 50 meters of radius of the establishment, as protection may be granted under S. 18 only if the demonstration is being held beyond 50-100 meters of the establishment.

Privilege to make agreements in restraint of trade 

As per S. 19, such agreements in restraint of trade are valid, and are not subject any law in force. Even S. 27 of the Contract Act which holds such agreements void does not apply here.

For example: 

Not to work on low wages for longer hours in an establishment.

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Not to work in an establishment until their demands regarding better working conditions or more salary with other facilities and bonus, etc. are met with.

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But such agreements are not enforceable. One member of a TU cannot file a civil suit against another member stating that he had broken such agreement and claiming enforcement of the agreement or damages.

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Such provision has been there to protect industrial peace and maintenance of unity within a TU.