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Trade union related legislation in India

The Indian Trade Unions Act, 1926 is applicable to registered Trade Unions. To be eligible for registration, a trade union must have at least 7 members, and as on the date of the application for registration, it must have at least 10 percent of the workmen or 100 workmen (whichever is less) working in the establishment or industry with which it is connected, as its members. The application for registration must be made to the Registrar of Trade Unions. Although a registered trade union is required to file certain financial statements, it is different from a society, a co-operative society or a company, and the provisions of those acts do not apply to it.

Advantages of a registered trade union

There are 3 major advantages for a registered trade union:


1. No civil suit can be initiated against any registered Trade office-bearer or member for any act done in furtherance of a trade dispute to which a member of the Trade Union is a party only:


a. On the ground that it induces another person to break a contract of employment, or

b. On the ground 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.


2. No office bearer shall be liable for entering into an agreement to do any act in furtherance of the objects of the union, unless it is an agreement to commit an offence.


3. A trade union is also not liable for 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.


It must have its own set of rules which provide for:

  • its name, objects, the purposes for which the general funds shall be applied,
  • facilities for inspection of list of members,
  • provisions for admission of members,
  • payment of a minimum subscription by members,
  • conditions under which any member shall be entitled to any benefit assured by the rules and under which any fine or forfeiture may be imposed on the members;
  • procedure for amendment of the rules
  • Procedure for election and removal of executive members and office-bearers
  • the duration of period (being not more than three years), for which the office-bearers and executive members of the Trade Union shall be elected
  • the safe custody of the funds of the Trade Union, annual audit and adequate facilities for the inspection of the account books by office-bearers and members
  • the manner of dissolution of the Trade Union

Compliance Requirements

 An audited statement of receipts and expenditure and assets and liabilities of the trade union must be filed with the Registrar of Trade Unions for the year ending on the 31st day of December.


2. A statement showing changes in office-bearers made by the Trade Union during the year to which the general statement refers, with a copy of the rules of the Trade Union corrected up to the date of the despatch thereof to the Registrar.


3. A copy of every alteration made in the rules of a registered Trade Union shall be sent to the Registrar within fifteen days of the making of the alteration.


In case of the following events a notice must be filed with the Registrar

  • change of name
  • amalgamation
  • dissolution

Violation of the Act may result in a fine of Rs. 5/- to Rs. 500/- depending upon the offence.

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