THE ENACTMENT of the Industrial Relations Code, 2020 (‘IR Code’) November 21, 2025, brought about a significant change in the labour adjudication mechanism. The IR Code effectively abolished Labour Courts leaving behind a one-window adjudication forum at the Industrial Tribunal level. By its legislative scheme for adjudication, all industrial disputes, both the collective and individual disputes, would be decided by the reconstituted Industrial Tribunals. A notification released on December 8 by the Ministry of Labour and Employment, called the Industrial Relations (Removal of Difficulties) Order, 2025, recognised the institutional void that this transition creates and permitted existing Labour Courts to continue until the new Tribunals are constituted and operational. But this is a deferral, not a reprieve. Essentially the statute abolishes the Labour Courts.
The objective of the labour law reform is simplification and increasing accessibility to labour rights. The argument is that Labour Courts are slow, overburdened, and redundant. A single unified forum which would be more efficient. But efficiency is an implementation question – it is not necessarily linked directly to the failure of the institution itself. And the particular inefficiencies of Labour Courts such as delay, formalism, and backlog have been studied, diagnosed, and prescribed for by Indian and comparative scholars over more than five decades. Not one credible prescription in that body of scholarship recommends abolition of Labour Courts. What has been consistently recommended is structural reform of the adjudication model.
Labour Courts Under the IDA: Legislative Design
The Industrial Disputes Act, 1947 (‘IDA’) drew a careful and consequential distinction between two types of adjudicatory forums.
Labour Courts, constituted under Section 7, were assigned jurisdiction over what scholars call ‘rights disputes’ such as wrongful dismissal, discharge, interpretation of standing orders, withdrawal of customary benefits, and the legality of strikes and lockouts. These matters are listed in the Second Schedule of the IDA. They are individual disputes about existing terms of an employment relationship, disputes where a worker asks whether what was done to them was lawful.
Industrial Tribunals, constituted under Section 7-A, were given broader jurisdiction over collective questions about wages, fringe benefits, bonus, rationalisation, and working conditions listed in the Third Schedule. The IDA treated these conceptually different disputes under two different forums.
The presiding officers of Labour Courts under the IDA are district judges, additional district judges, persons who had held judicial office for not less than seven years, or judges of a High Court. An amendment to the IDA in 2010 added Deputy Labour Commissioner or Joint Commissioner of the State Labour Department with Law Degree and a total of seven years’ experience inclusive of three years as conciliation officer. The requirement of knowledge in law and legal practice was inserted keeping in mind that an individual worker’s claim of wrongful dismissal, misapplication of standing reinstatement disputes etc. required knowledge in law and fair process to understand justiciability/justifiability, evidence standards, and natural justice. Beyond this, Labour Courts held the powers of a First Class Magistrate for prosecuting offences under the IDA, and those of a civil court for other proceedings. Their quasi-judicial character was not merely nominal. In function and in authority, they operated as genuine courts.
Then in 1976, Section 2-A was introduced into the IDA which allowed individual workers to bring their own termination disputes directly before Labour Courts without requiring espousal of the union. For workers in small establishments or poorly organised sectors, where functioning unions were either absent or ineffective, this came as a substantive protection. The numbers show that roughly ninety per cent of government conciliation efforts and adjudication references concerned discharge, dismissal, retrenchment, or termination. Individual rights disputes, in other words, formed the overwhelming bulk of Labour Court business.
The IR Code, 2020 repeals this labour adjudicatory structure entirely. Section 44 reconstituted Industrial Tribunals and it replaced Labour Courts and other adjudicatory bodies. There is a judicial member and administrative member as presiding officers of the Tribunal under Section 44(2). Section 44(3) permits administrative members without mandatory judicial or legal qualification to preside over the Tribunal. Section 44(7) designates the categories that require a two-member bench such as standing orders, dismissal, reinstatement, illegality of strikes and lockouts, retrenchment, closure, and trade union disputes. These are the very matters that were the core jurisdiction of Labour Courts. The cases most critical to individual workers will now be decided by benches whose decisional composition is, at minimum, uncertain.
Administrative Members: Independence, Expertise, and the Risk of Executive Capture
The IR Code 2020’s introduction of administrative members to Industrial Tribunal benches is presented as a reform to bring industrial relations expertise into adjudication. However, comparative scholarship suggests that this could introduce executive influence into what should be an independent judicial function. Under the IDA, originally only judges with a minimum experience of three or seven years were appointed as judges of the Labour Court/Industrial Tribunal. The Industrial Disputes Amendment Act, 2010 stated that while executive officers in the designation of Deputy Labour Commissioner or officers in Indian Legal Service with experience could be appointed as presiding officers of the court or tribunal, a law degree was made mandatory. However, the labour court largely functioned with the judges in India.
Section 44(2) of the IR Code provides for two-member Tribunal benches comprising one judicial member and one administrative member. The Code does not specify detailed qualifications for administrative members comparable to those for judicial members, who must be or have been High Court judges, District Judges with three years’ experience, or persons with seven years of judicial office. This lacuna is not minor. It creates structural uncertainty about their approach towards social justice, rather than merely an administrative exercise. Judicial officers ask, ‘What does the law require?’ However, administrative members operate within a fundamentally different frame of reference, Their instinct may be to inquire what may be operationally convenient or what may align with government policy. This shift may pose challenges to welfare-based interpretation.
Further, Section 47(2)(3) states that if judicial and administrative members differ in opinion, they must state points of difference and refer them to the appropriate Government. There is no internal appellate check. The Government then handpicks a judicial member from another Tribunal to break the tie. The moment a government becomes the architect of its own dispute resolution outcomes, selecting the person whose decision will be integral to resolve the case, the independence of the adjudicatory process becomes, at best, a formal gesture.
Employment security, fair wages, and protection from arbitrary dismissal are statutory and constitutional rights. Their adjudication by mechanism of executive referral when the adjudicators disagree fundamentally undermines the concept of independent judicial determination. The delay that it takes in this process is a cost on the worker-litigator before the court.
Labour Courts, under the IDA, had constitutional insulation. Their presiding officers enjoyed tenure security and could only be removed for proved misbehaviour or incapacity after due process. This insulated them from executive pressure.. Academic Debi S. Saini documented through fieldwork how the compulsory adjudication framework produced alliances between conciliation officers, puppet unions, and the political executive. The IR Code restructures adjudication in ways that deepen, rather than dismantle, those structural vulnerabilities.
The comparative evidence is instructive. In the German tripartite labour court model that has operated since the Weimar Republic, and in the British employment tribunal system, non-judicial members, including union and employer representatives, participate alongside judicial chairs. But both systems operate under strict independence requirements such as that lay members cannot be recalled by the organisations that nominated them, cannot represent partisan interests in proceedings, and operate within frameworks where the professional judge retains effective decisional authority on legal questions. India’s labour adjudication structure does not have a participatory model with inclusion of labour and employer representatives in advisory capacity, which could have made judicial decisions more pragmatic and resolution oriented.
The Juridification Problem: A Critical question in labour adjudication
Scholarly literature on India’s labour adjudication system is consistent in its diagnosis. The most granular empirical work comes from Saini’s fieldwork in the Faridabad industrial complex which documented the phenomenon of ‘juridification’, a term borrowed from German scholarship and applied to Indian industrial relations.
Juridification, as J. Clark and Lord Wedderburn had defined it in the British context,* refers to the extent to which the behaviour of line and personnel managers, shop stewards and full time officers in dealing with individual and collective employment issues is determined by reference to legal (or what are believed to be legal) norms and procedures, rather than to voluntarily agreed norms and procedures or to custom and practice. The formalism, delay, and alienation of workers were documented across both tiers of adjudication in India. But, the prescription is not institutional abolition but restructuring of the compulsory adjudication model itself.
Pendency: As a Resourcing Problem
The pendency crisis is real and serious. But abolition of Labour Courts does not address the structural causes at the root of it. Saini’s empirical research identified the structural sources of delay with precision. The adversarial legal culture produced by the compulsory adjudication framework, the consequent dominance of professional outsiders who had no institutional incentive to promote speedy resolution, liberal adjournment practices, the absence of trained adjudicators in industrial relations dynamics, and the progressive conversion of substantive industrial disputes into procedural legal contests are factors for delay in labour adjudication.
The increasing incidence of arrears of cases pending before adjudicators tells us that the elimination of the forum dispensing justice is not the solution. Channelling disputes from district-level Labour Courts to sole Tribunals does not reduce delay. It only adds a layer of institutional transition cost on top of existing structural deficits.
The IR Code’s abolition of Labour Courts would have a direct link on the pendency question. The National Commission on Labour as early as 1969, the Ramanujam Committee in 1990, and successive reform commissions all recommended structural reform of the adjudication model with more forums, better trained adjudicators, simplified procedures, activated conciliation and enterprise-level grievance mechanisms. Abolition or repeal of the adjudicatory forum was never recommended as an option, considering the backlog and delay.
The Constitutional Imperative: Reform over Abolition
The Directive Principles of State Policy, particularly Articles 39, 41, and 43A, express a constitutional commitment to economic democracy, equitable sharing of industrial gains, and workers’ participation in the management of undertakings. Labour Courts operationalised this constitutional commitment by providing workers, the weaker party in the employment relationship, with accessible, expert, and independent forums in which to enforce their statutory and constitutional rights before qualified judicial officers.
The abolition of Labour Courts without equivalent institutional substitution is a step away from, rather than towards, this constitutional vision. As the UK Supreme Court held in R (UNISON) v. Lord Chancellor (2017), access to a court is not a private amenity but a public good that underpins the rule of law, and restrictions on that access must be scrutinised against the legislature’s evident purpose of conferring enforceable rights on the weaker party. The Indian constitutional equivalent of this principle is the State’s directive duty to ensure social and economic justice through adjudicatory institutions such as labour courts and industrial tribunals.
Studies have argued for expanded numbers, adequate resources, filled vacancies, and genuine investment in adjudicatory quality and speed of Labour Courts. One Labour Court in each district is non-negotiable to lessen the delay and increase trust in the labour adjudication. Comparative studies on labour adjudication has indicated how ‘juridification’ distances the workers from pursuing litigation. Procedural standards of ‘beyond reasonable doubt’ and its rules often put the workers at disadvantages. Labour Courts should adopt inquisitorial methods where appropriate, take evidence on affidavit, and manage dockets actively to reduce the professional rent seeking that ‘juridification’ produces.
As institutions, Labour Courts are designed for individual disputes. Conceptually and procedurally, it is well established that they are distinct from Industrial Tribunals. It is also well established that individual rights disputes constitute a major share of industrial adjudication in India. Therefore, the IR Code’s abolition of Labour Courts would drastically affect workers’ access to justice.
The challenge of labour adjudication in India is pointed out as ‘juridification’ in labour adjudication. It shows limitations of the philosophy of labour law and the rationale of establishment of special courts like Labour Courts and Industrial Tribunals. The adversarial legal procedures in labour adjudication, and the suppression of workplace voluntary structures shift the formalistic conversion of socio-economic disputes into legal contests. Therefore, abolition of labour courts without reforming the structural framework does not cure the ‘juridification’ problem. It only removes an institution which has already created a system for access to justice.
The abolition of a seven decades old social justice institution, without stakeholder consultation, without equivalent substitution, at the precise moment when it requires strengthening rather than abolition is condemnable. This exhibits the hallmarks of ‘autocratic legalism’, as Kim Lane Schepple argues, the use of legal form to achieve illiberal ends, the deployment of reform language in service of institutional dismantlement, and the silencing of the constituencies most affected.
India’s workers deserve adjudicatory forums that are accessible, independent, specialised, and committed to enforcing their rights. The elimination of adjudicatory institutions, like Labour Court, addresses none of the structural pathologies that produced the access inequality. This one-window adjudication through Industrial Tribunals would result in pendency and clogging of both individual and collective disputes in one forum. This will result in the abandonment of the constitutional promise that law exists to protect those who most need its protection.