Why in news
- A nine-judge Constitution Bench of the Supreme Court heard re-arguments on the expansive legal definition of 'industry' established in 1978.
Information
- The Supreme Court is reviewing the benchmark 1978 Bangalore Water Supply case verdict which broadly defined 'industry' under the Industrial Disputes Act.
- The 1978 precedent included statutory bodies, educational institutions, hospitals, and government undertakings within the definition, excluding only sovereign government functions.
- Multiple state governments sought a relook, arguing that sovereign welfare schemes and government departments should not be treated as commercial industries.
- A narrower definition would alter employee dispute resolution mechanisms, retrenchment protection, and labor union coverage across public administration.
- The ruling will clarify the statutory operational boundary between sovereign welfare activities and commercial state enterprises.
Key terms
Sovereign Function
Inalienable functions performed by the state such as defense, police, administration of justice, and legislative affairs.
Industrial Dispute
Any dispute or difference between employers and workmen connected with employment terms or conditions of labor.
Prelims facts
- The Bangalore Water Supply case established the 'triple test' involving systematic activity, cooperation between employer and employee, and production of goods/services.
- Labor falls under the Concurrent List of the Seventh Schedule of the Constitution.
Mains discussion
- Examine the economic and administrative implications of redefining 'industry' under Indian labor law.
- Discuss how judicial interpretation of welfare activities impacts state liability and labor protection standards.
Source: The Hindu