Second Schedule explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Part I of the Second Schedule lists sixteen unfair labour practices by employers and trade unions of employers. They range from threatening workers who join a union, to dismissing by victimisation, to keeping workers as casuals for years, to failing to implement an award or settlement. The Schedule is cross-referred in sections 2(zo), 84, 86(5) and 101(1), so it is the list against which a complaint of unfair labour practice is tested.
Part I has sixteen entries headed "On the part of employers and trade unions of employers". The main groups are interfering with the right to organise (1 to 4), unfair dismissal (5), mala fide transfers, contractors and bonds (6 to 8), favouritism and casualisation (9, 10), retaliation and strike-time recruitment (11, 12), and failure to implement awards, force or violence, refusal to bargain and illegal lock-outs (13 to 16). The Central Government may amend the Schedule under s.101(1). Penalties are in s.86, not in the Schedule.
Part I at a glance
| No. | Practice (summary) |
|---|---|
| 1 | Interfering with, restraining or coercing workers in the right to organise, join or assist a Trade Union, or in concerted activity; for example threats of discharge, threatening a lock-out or closure, timing wage increases to undermine a union |
| 2 | Dominating, interfering with or supporting a Trade Union, including partiality to one of several unions that is not recognised |
| 3 | Establishing employer sponsored Trade Unions |
| 4 | Encouraging or discouraging membership by discrimination, six listed examples (a) to (f) |
| 5 | Discharging or dismissing workers by victimisation, in colourable exercise of rights, by false criminal implication, on patently false reasons, on trumped up absence, in disregard of natural justice, or disproportionately for minor misconduct, items (a) to (g) |
| 6 | Abolishing regular work and giving it to contractors to break a strike |
| 7 | Mala fide transfer under the guise of management policy |
| 8 | Insisting on a good conduct bond from workers on a legal strike before they resume |
| 9 | Favouritism or partiality to one set of workers regardless of merit |
| 10 | Keeping workers as badli, casual or temporary for years to deprive them of permanent status |
| 11 | Discharging or discriminating against a worker for filing charges or testifying |
| 12 | Recruiting workers during a strike which is not an illegal strike |
| 13 | Failure to implement award, settlement or agreement |
| 14 | Acts of force or violence |
| 15 | Refusing to bargain collectively in good faith with recognised Trade Unions |
| 16 | Proposing or continuing a lock-out deemed illegal under the Code |
How the Schedule is used
Section 84 deals with unfair labour practices and the power to impose a penalty, and section 86(5) and related provisions refer to the Schedule (see sections 84 and 85 and section 86 on penalties). This article sets out what each entry says; it does not restate the penalty. If your HR team is reviewing transfers, terminations or union-related decisions against this list, our employment and labour law advisory team can help you test each decision against the entries before it is taken.
Also note the heading: Part I covers "employers and trade unions of employers". Part II covers workers and their trade unions (see our article on Part II).
The entries in detail
Entries 1 to 4: freedom to organise
Entry 1 is the widest: to "interfere with, restrain from, or coerce, workers in the exercise of their right to organise, form, join or assist a Trade Union or to engage in concerted activities for the purposes of collective bargaining or other mutual aid or protection". Its three examples are threatening discharge or dismissal if workers join a union, threatening a lock-out or closure if a union is organised, and granting a wage increase at crucial periods of union organisation "with a view to undermining the efforts" of the union.
Entry 2 prohibits dominating, interfering with or supporting a union financially or otherwise. Examples: an employer taking an active interest in organising a union of his workers, and showing partiality or favour to one of several unions attempting to organise his workers where that union is not a recognised Trade Union. Entry 3 is "to establish employer sponsored Trade Unions of workers".
Entry 4 prohibits encouraging or discouraging membership by discrimination. Its six examples:
- (a) discharging or punishing a worker for urging others to join or organise a union;
- (b) discharging or dismissing a worker for taking part in a strike, unless it is a strike deemed illegal under the Code;
- (c) changing seniority rating because of union activities;
- (d) refusing to promote on account of union activities;
- (e) unmerited promotions to create discord or undermine a union;
- (f) discharging office-bearers or active members because of their union activities.
Entry 5: dismissals
Entry 5 lists seven forms of unfair discharge or dismissal: (a) by way of victimisation; (b) not in good faith, but in colourable exercise of the employer's rights; (c) by falsely implicating a worker in a criminal case on false or concocted evidence; (d) for patently false reasons; (e) on untrue or trumped up allegations of absence without leave; (f) in utter disregard of natural justice in the domestic enquiry or with undue haste; and (g) for misconduct of a minor or technical character, without regard to the nature of the misconduct or the worker's past record, leading to disproportionate punishment.
Items (f) and (g) bear on everyday HR practice. A fair enquiry and a punishment in proportion to the misconduct protect the employer against a later finding of unfair labour practice. See sections 38 and 39 for suspension pending enquiry.
Entries 6 to 10: contractors, transfers, bonds, favouritism, casualisation
Entry 6 covers abolishing regular work to give it to contractors "as a measure of breaking a strike". Entry 7 covers transferring a worker "mala fide" under the guise of management policy. Entry 8 covers insisting that workers on a legal strike sign a good conduct bond before resuming. Entry 9 covers favouritism or partiality "regardless of merit". Entry 10 covers employing workers as badli workers, casuals or temporaries and continuing them as such "for years, with the object of depriving them of the status and privileges of permanent workers". Note the object test in entry 10: the wording is about the purpose of depriving status. See also contract labour under the new labour codes.
Entries 11 to 16: retaliation, strike recruitment, awards, force, bargaining, lock-outs
Entry 11: discharging or discriminating against a worker for filing charges or testifying in an industrial dispute proceeding. Entry 12: recruiting workers during a strike which is not an illegal strike. Entry 13: "failure to implement award, settlement or agreement". Entry 14: acts of force or violence. Entry 15: refusing to bargain collectively in good faith with recognised Trade Unions. Entry 16: proposing or continuing a lock-out deemed illegal under the Code (see sections 63 and 64).
Practical examples
Example (invented) 1. An employer hears that a union is being formed and announces that workers who join will lose their overtime. This is the kind of conduct entry 1 addresses: interfering with or coercing workers in their right to join a union. Whether it fits entry 1 depends on the facts.
Example (invented) 2. A worker who gave evidence for the union in a Tribunal proceeding is moved to a distant plant a month later under "management policy", with no operational reason. If the transfer is mala fide, it falls under entry 7, and depending on the facts entry 11.
Need help reviewing decisions against the list?
The entries turn on intent and process, so the file note behind a dismissal or transfer matters as much as the outcome. Our employment and labour law advisory team can help you review disciplinary and transfer decisions and the record that supports them.
Key takeaways
- Part I lists sixteen unfair labour practices by employers and trade unions of employers.
- Entries 1 to 4 protect the right to organise and bar employer-sponsored unions.
- Entry 5 lists seven forms of unfair dismissal, including disregard of natural justice and disproportionate punishment.
- Entry 10 bars keeping workers as casuals or temporaries for years to deny permanent status.
- Entries 13 and 15 cover failure to implement awards and refusal to bargain with recognised unions.
- Penalties are in s.86; the Central Government can amend the list under s.101(1).
Read next
- Second Schedule Part II: unfair labour practices by workers and trade unions
- Section 84-85: unfair labour practices and power to impose penalty
- Section 86: penalties for lay-off, retrenchment, closure and unfair labour practice
- Industrial disputes under the new labour codes: IR Code 2020
Disclaimer: Based on the Industrial Relations Code, 2020 (as enacted) and, where noted, the Industrial Relations (Central) Rules, 2026 (G.S.R. 342(E), 8 May 2026), as on 30 September 2026. The Code is in force from 21 November 2025; some provisions may be notified later, and State Governments make their own rules for establishments where the State is the appropriate Government. Verify the current position before acting.