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What happens when an employer treats its employees unfairly?
Sometimes, the unfair treatment that an employee feels may not be intentional. It could happen because the employer lacks proper awareness or guidance. But whatever the reason, if an employee is treated unfairly, it can lead to serious consequences such as work disruption, legal penalties, court rulings, and even damage to the company’s reputation.
One organisation learned this the hard way when it was penalised for wrongful termination. The management hadn’t followed the right procedures, which led to serious legal action later. This shows that fairness at the workplace isn’t just a moral responsibility but also a legal requirement.
In this blog, you’ll learn what unfair labour practices in labour law mean, the penalties involved, examples of such practices by employers, and how to prevent them in your company.
Unfair labour practices in labour law are basically actions by an employer or a union that break employees’ rights or disturb industrial peace. To put that in simple words, it’s anything that stops workers from being treated fairly or discourages them from exercising their legal rights.
In India, these practices are taken very seriously by labour courts and are governed by multiple laws. So, both you as an employer and your employees are expected to stay within legal limits to keep mutual respect and workplace balance intact.
Knowing the laws around unfair labour practices is important because it helps you as employer to stay compliant and avoid unintentional mistakes. The main law amongst all is the Prevention of Unfair Labour Practices Act, 1971, which clearly defines and forbids certain acts that harm employees’ rights or collective interests.
Here are the laws governing the unfair labour practices in India:
Basically, these laws are here to protect your team and help you run things fairly without risking legal trouble.
Now that you have a basic understanding of the laws, let’s see what unfair labour practice by the employers.
If an employer is found guilty of unfair labour practices in India, the consequences aren’t just a slap on the wrist. They can hit you financially, legally, and even reputationally.
Here’s a simple breakdown:
So, it’s not just about ticking compliance boxes but also about building a workplace where fairness and integrity actually shape your work culture.
Now, if you’re already facing the trouble then here’s how to resolve it.
Incident:
A leading chemicals and dyes trading company decided to close its Churchgate division in Mumbai, which had around 90 employees. They sent a notice under Section 25-FFA of the Industrial Disputes Act, 1947, intending to shut down the unit. But the employees’ union stepped in, saying the company didn’t follow the correct legal steps before ending jobs and closing the unit.
Violations:
Outcome:
In 1986, the Supreme Court ruled the closure illegal. The company had committed an unfair labour practice under Item 9 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971. The court ruled that the employers should reinstate the employees with full wages from the date of termination.
Honestly, this case is a solid reminder that skipping legal steps or ignoring agreements can hit you hard. Even if you think your decision is fair, you really have to make sure it follows labour laws to protect both your team and your business.
Navigating unfair labour practices in labour law can be tricky when you have a lot on your plate. At Vishaal Consultancy Services, we help employers like you understand the laws, review HR policies, and stay compliant at every level.
We also offer expert advice, help with dispute resolutions, and guide you in building a transparent, compliant workplace. At, Vishaal Consultancy Services, we take care of legal compliance, so you can focus on running your business confidently and ethically.
Fairness at work builds loyalty, trust, and long-term success. Knowing about unfair labour practices in labour law isn’t just about avoiding penalties on your part but it’s also important to shape a workplace culture where employees feel respected. When the employees’ rights are honoured, they naturally become more productive and loyal.
And if you’re unsure about your current labour practices or want to prevent compliance risks, we offer trusted labour law advisory support to help you stay on track. Our experts at Vishaal Consultancy Services will keep both your team and your business safe and complaint. Contact us, today.
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