Trade unionism and the Trade Union Act 1926

There are almost ten major central union organisations of workers based on different political ideologies. Almost every union is affiliated to one of these. These central organisations have state branches, committees, and councils from where its organisation works down to the local level.

The first central trade union organisation in India was the All India Trade Union Congress (AITUC) in 1920 – almost three decades before India won independence. At about the same time workers at the Buckingham and Carnatic Mills, Madras went on strike led by B P Wadia. The management brought a civil suit against the workers in the Madras High Court and not only obtained an injunction order against the strike but also succeeded in obtaining damages against the leader for ‘inducing a breach of contract’. This was followed by widespread protests that finally yielded in the Trade Union Act 1926 giving immunity to the trade unions against certain forms of civil and criminal action. Apart from this aspect the Trade Union Act also facilitated registration, internal democracy, a role for outsiders and permission for raising a political fund subject to separate accounting requirements.The Trade Union Act facilitates unionisation both in the organised and the unorganised sectors. It is through this law that the freedom of association that is a fundamental right under the Constitution of India is realised.

The right to register a trade union however does not mean that the employer must recognise the union – there is in fact no law which provides for recognition of trade unions and consequently no legal compulsion for employers, even in the organised sector, to enter into collective bargaining.
Yet in reality because of the strength of particular trade unions there is fairly widespread collective bargaining, especially in the organised sector.

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