Dear Members
I have a confusion in interpreting Chapter VA and VB of the ID Act
Section 25FF of chapter VA is narrated below
25FF. Compensation to workmen in case of transfer of undertakings
Where the ownership or management of an undertaking is transferred, whether by agreement or by operation of law, from the employer in relation to that undertaking to a new employer, every workman who has been in continuous service for not less than one year in that undertaking immediately before such transfer shall be entitled to notice and compensation in accordance with the provisions of section 25F, as if the workman had been retrenched
Section 25S in chapter VB
25S. Certain provisions of Chapter V-A to apply to an industrial establishment to which this Chapter applies
The provisions of sections 25B, 25D, 25FF, 25G, 25H and 25J in Chapter V-A shall, so far as may be, apply also in relation to an industrial establishment to which the provisions of this Chapter apply.
My question is whether we can transfer the ownership of the Undetaking which employ around 150 workmen without seeking the permission of the approptiate goverment since as per the act sec 25FF provisions can be applied for Chapter VB companies also.
Kindly share your view on the above
From India, Mumbai
3I have a confusion in interpreting Chapter VA and VB of the ID Act
Section 25FF of chapter VA is narrated below
25FF. Compensation to workmen in case of transfer of undertakings
Where the ownership or management of an undertaking is transferred, whether by agreement or by operation of law, from the employer in relation to that undertaking to a new employer, every workman who has been in continuous service for not less than one year in that undertaking immediately before such transfer shall be entitled to notice and compensation in accordance with the provisions of section 25F, as if the workman had been retrenched
Section 25S in chapter VB
25S. Certain provisions of Chapter V-A to apply to an industrial establishment to which this Chapter applies
The provisions of sections 25B, 25D, 25FF, 25G, 25H and 25J in Chapter V-A shall, so far as may be, apply also in relation to an industrial establishment to which the provisions of this Chapter apply.
My question is whether we can transfer the ownership of the Undetaking which employ around 150 workmen without seeking the permission of the approptiate goverment since as per the act sec 25FF provisions can be applied for Chapter VB companies also.
Kindly share your view on the above
From India, Mumbai
No need of prior permission for transfer of undertaking. Varghese Mathew
From India, Thiruvananthapuram
From India, Thiruvananthapuram
Since the company has 150 employees, the Capter VB will apply to it. Transfer of undertaking by itself has two elements, viz, closure and retrenchment and retaining the continuity of service and maintaining conditions of service of workers in the new company. The former is part of retrenchment and therefore, will attract section 25F or 25N, as the case may be. The latter will decide whether the compensation at the rate of 15 days’ pay for every year of service and one month notice (three months’ notice in the case of companies coming under chapter VB) or payment in lieu of notice will have to be paid or not. No such compensation is required to be paid if the service of the workers are not going to be interrupted due to such transfer and if the service conditions of workers of old company is going to be the same or superior in the new company. In the absence of an agreement either bilateral or settlement u/s 12(3) (which is always preferred) it will be treated as if there is retrenchment and payment of retrenchment compensation by either the old company or by the new company. That means, if you do the transfer by settling the dues of workers, paying their retrenchment compensation etc as on the date of transfer, without taking approval the things will lead to attract penalty and punishment as per 25Q of the Act. Therefore, it is advisable to take permission and proceed. Moreover, if you decide to retain the service of the workers, it would be better if you have a settlement to this effect before the Conciliation Officer.
Madhu.T.K
From India, Kannur
Madhu.T.K
From India, Kannur
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