The Trade Union Act, 1926 is a landmark legislation in India that governs the formation, registration, and operation of trade unions. Enacted on March 25, 1926, and effective from June 1, 1927, it was introduced to provide legal recognition and protection to trade unions, enabling workers to organize collectively to negotiate better wages, working conditions, and rights. Below is a detailed overview of the Act, its key provisions, amendments, and significance, with updates relevant to 2025.

Historical Context

The Act was a response to the growing trade union movement in India during the colonial period, spurred by industrialization and poor working conditions in industries like textiles and railways. The 1920s saw a surge in strikes (over 1,000 between 1920-1924), with organizations like the All India Trade Union Congress (AITUC, founded 1920) advocating for workers’ rights. The Act aimed to formalize and regulate unions, influenced by global labor movements and the establishment of the International Labour Organization (ILO) in 1919.

Key Provisions of the Trade Union Act, 1926

The Act, as originally framed and amended, includes the following key provisions:

1. Definition of a Trade Union (Section 2(h)):
   • A trade union is defined as any combination, temporary or permanent, formed primarily to regulate relations between workmen and employers, workmen and workmen, or employers and employers, or for imposing restrictive conditions on the conduct of any trade or business, including federations of unions.
2. Registration of Trade Unions (Sections 3-9):
   • Any seven or more members of a trade union can apply for registration by submitting an application to the Registrar of Trade Unions, along with the union’s rules, objectives, and constitution.
   • The union must include details like the purpose of the union, rights and liabilities of members, and provisions for fund usage.
   • Upon satisfaction, the Registrar issues a certificate of registration, granting legal status.
3. Legal Status and Rights (Sections 13-15):
   • Registered trade unions gain corporate status, enabling them to sue, be sued, and hold property in their name.
   • Unions and their members are granted immunity from civil suits for actions taken in furtherance of a trade dispute, provided they are lawful (e.g., strikes not inciting violence).
   • Immunity from criminal conspiracy is provided under Section 17 for acts done in contemplation of a trade dispute, unless they involve illegal activities.
4. Funds and Their Utilization (Sections 15-16):
   • Unions can create a general fund for activities like salaries, administration, and member welfare, and a separate political fund for political activities (e.g., supporting candidates or parties).
   • Funds cannot be used for purposes outside the union’s stated objectives.
5. Rights and Obligations:
   • Unions must submit annual returns to the Registrar, detailing financial statements and membership details.
   • The Act allows unions to engage in collective bargaining and represent workers in disputes.
   • Outsiders (non-workers) can hold office in unions, but at least half of the office-bearers must be employed in the industry concerned.
6. Penalties and Dissolution (Sections 10, 27, 31):
   • The Registrar can cancel registration for non-compliance, fraud, or if the union ceases to exist.
   • Penalties are imposed for failing to submit returns or providing false information.
   • Upon dissolution, the union must notify the Registrar within 14 days and settle debts as per its rules.
     

Amendments to the Act

The Trade Union Act, 1926, has been amended to address changing labor dynamics:

• Trade Unions (Amendment) Act, 2001:
  • Reduced the minimum membership requirement for registration from 10% or 100 workers to a minimum of 7 members, making it easier for smaller groups to form unions.
  • Restricted the number of outsiders in leadership roles to one-third of total office-bearers or five, whichever is less, to ensure worker representation.
  • Mandated elections for office-bearers at least every three years to promote democratic functioning.
• Proposed Changes and Labour Codes (2020):
  • The Trade Union Act, 1926, was partially subsumed under the Industrial Relations Code, 2020, one of the four new labor codes aimed at consolidating and modernizing labor laws.
  • The Industrial Relations Code introduces stricter requirements for union recognition, such as needing 10% of workers or 100 members to apply for registration and recognition as a negotiating union.
  • It imposes restrictions on strikes, requiring 14 days’ notice and prohibiting strikes during conciliation or arbitration proceedings.
  • As of 2025, the full implementation of the Industrial Relations Code is ongoing, with states framing rules, but the Trade Union Act, 1926, remains partially in force for aspects not covered by the new code.

Significance of the Act

• Legal Recognition: The Act provided trade unions with a legal framework, granting them immunity from civil and criminal liabilities for legitimate activities, which encouraged unionization.
• Worker Empowerment: It facilitated collective bargaining, enabling workers to negotiate better wages, hours, and conditions, especially in industries like textiles, railways, and plantations.
• Foundation for Labor Movement: The Act laid the groundwork for the growth of major trade unions like INTUC, BMS, and AITUC, which became politically influential post-independence.
• Alignment with ILO Principles: While India has not ratified ILO Conventions C087 (Freedom of Association) and C098 (Collective Bargaining), the Act aligns partially with these by recognizing unions’ rights to organize and negotiate.

Challenges and Criticisms

• Limited Coverage: The Act primarily applies to the organized sector, leaving out 92% of India’s workforce in the informal sector as of 2025.
• Political Fragmentation: The Act allows multiple unions in a single workplace, leading to rivalry and fragmentation, often along political lines (e.g., INTUC vs. CITU).
• New Labour Codes: The Industrial Relations Code, 2020, has raised concerns for diluting union protections by increasing thresholds for registration and restricting strikes, seen as anti-worker by unions like CITU and AITUC.
• Enforcement Issues: Weak enforcement of the Act, especially in smaller industries, and bureaucratic delays in registration remain challenges.

Recent Developments (2025)

• Ongoing Transition to Labour Codes: As of July 2025, the Industrial Relations Code, 2020, is being implemented unevenly across states, with some provisions of the Trade Union Act, 1926, still operational. Trade unions, including BMS and INTUC, have protested the new codes, arguing they weaken union rights and favor employers.
• Nationwide Strikes: The Bharat Bandh on July 8-9, 2025, saw unions demand the rollback of labor codes and ratification of ILO conventions like C155 (Occupational Safety) amid incidents like the Silkyara Tunnel collapse.
• Membership Verification: The ongoing verification process (using 2011 as a reference) continues to assess union membership for Central Trade Union Organization status, impacting recognition under the Act.

Conclusion

The Trade Union Act, 1926, remains a cornerstone of India’s labor framework, providing legal recognition and protections for unions despite its limitations. While it empowered workers and shaped the labor movement, challenges like informal sector exclusion, political fragmentation, and the transition to new labor codes persist. Its relevance in 2025 is tied to ongoing debates over labor reforms and ILO compliance, with unions actively resisting perceived anti-worker policies. For further details on specific provisions or implementation status, users can refer to official government sources or the ILO database.