Section 86 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.
Sub-sections (7) to (20) of section 86 cover the remaining offences in the Code: trade union defaults and false statements, standing order breaches, illegal strikes and lock-outs, breach of settlements and awards, disclosure of confidential information, and a residual fine for everything else. The fines are lower than for Chapter X breaches, but several carry imprisonment of up to three months.
Trade Union default in giving notices or documents: Rs 1,000 to Rs 10,000, plus Rs 50 per day for continuing default (s.86(7)). Standing orders: failing to submit draft standing orders or modifying them wrongly, Rs 50,000 to Rs 2,00,000 plus Rs 2,000 per day (s.86(10)); acting against certified standing orders, Rs 1,00,000 to Rs 2,00,000 (s.86(11)). Illegal strike by a worker: Rs 1,000 to Rs 10,000 or up to one month, or both (s.86(13)); illegal lock-out by an employer: Rs 50,000 to Rs 1,00,000 or up to one month, or both (s.86(14)). Breach of a settlement or award: Rs 20,000 to Rs 2,00,000 or up to three months, or both (s.86(17)). Any other contravention: fine up to Rs 1,00,000 (s.86(20)).
The penalties at a glance
Sub-sections (1) to (6) are covered in section 86(1) to (6). If a notice under any of these has reached you, our legal dispute resolution team can help you read it.
| Sub-section | Offender and default | Penalty |
|---|---|---|
| 86(7) | Office-bearer or person bound by the rules (or, if none, every executive member) of a registered Trade Union: default in giving any notice or sending any statement or document required under the Code | Rs 1,000 to Rs 10,000; continuing default: additional Rs 50 per day |
| 86(8) | Any person who wilfully makes a false entry or omission in the general statement under s.26 or in copies of rules or alterations sent to the Registrar | Rs 2,000 to Rs 20,000 |
| 86(9) | Any person who, with intent to deceive, gives a member or intending member a document purporting to be a copy of a union's rules or alterations that he knows or has reason to believe is incorrect, or gives the rules of an unregistered union pretending they are those of a registered one | Rs 5,000 to Rs 20,000 |
| 86(10) | Employer who fails to submit draft standing orders under s.30, or modifies standing orders otherwise than under s.35 | Rs 50,000 to Rs 2,00,000; continuing offence: additional Rs 2,000 per day |
| 86(11) | Employer who does any act in contravention of finally certified standing orders | Rs 1,00,000 to Rs 2,00,000 |
| 86(12) | Repeat offender after conviction under (11) | Rs 2,00,000 to Rs 4,00,000, or up to three months, or both |
| 86(13) | Worker who commences, continues or acts in furtherance of an illegal strike | Rs 1,000 to Rs 10,000, or up to one month, or both |
| 86(14) | Employer who commences, continues or acts in furtherance of an illegal lock-out | Rs 50,000 to Rs 1,00,000, or up to one month, or both |
| 86(15) | Any person who instigates or incites others to take part in, or acts in furtherance of, an illegal strike or lock-out | Rs 10,000 to Rs 50,000, or up to one month, or both |
| 86(16) | Any person who knowingly spends or applies money in direct furtherance or support of an illegal strike or lock-out | Rs 10,000 to Rs 50,000, or up to one month, or both |
| 86(17) | Any person who breaches a term of a settlement or award binding on him | Rs 20,000 to Rs 2,00,000, or up to three months, or both |
| 86(18) | Continuing breach under (17) | Additional fine up to Rs 1,000 per day after first conviction; the court may direct that all or part of the fine be paid as compensation to any affected person |
| 86(19) | Wilful disclosure of information referred to in s.61 in contravention of that section, on a complaint by or for the affected union or business | Fine up to Rs 20,000, or up to one month, or both |
| 86(20) | Contravention of any other provision of the Code not covered by (1) to (19), or of the rules or regulations | Fine up to Rs 1,00,000 |
Reading each group
Trade Union defaults (7) to (9)
Sub-section (7) shifts liability from the union to its people: the office-bearer or other person bound by the union's rules to give or send the document or, if none, every member of the executive. Annual returns under s.26 are a typical source; see sections 26 and 27. Sub-section (8) covers wilful false entries in that return. Sub-section (9) punishes deceptive copies of rules. These three are in the list of offences that an officer under s.85 can penalise by enquiry.
Standing orders (10) to (12)
Sub-section (10) covers two defaults: not submitting draft standing orders under s.30 and modifying standing orders other than under s.35. A continuing default adds Rs 2,000 per day. Sub-section (11) punishes acts in contravention of certified standing orders; sub-section (12) raises the penalty after a prior conviction. See section 30 and sections 33 to 35. Sub-sections (10) and (11) are within the s.85 enquiry list; (12) is not.
Illegal strikes and lock-outs (13) to (16)
What makes a strike or lock-out illegal is in sections 62 to 64 (and section 62). The penalties are graded:
- The worker who joins or continues: the lowest band, up to Rs 10,000 or one month.
- The employer in an illegal lock-out: Rs 50,000 to Rs 1,00,000, or up to one month, or both.
- The instigator or inciter, and a person who knowingly funds an illegal strike or lock-out: Rs 10,000 to Rs 50,000, or up to one month, or both.
Section 93 protects a worker who refuses to join an illegal strike from union penalties; see sections 93 and 94.
Settlements and awards (17) and (18)
A person who breaches a binding term of a settlement or award faces Rs 20,000 to Rs 2,00,000, or up to three months, or both. If the breach continues, an additional fine up to Rs 1,000 per day applies after the first conviction. The court can direct that the realised fine be paid as compensation to the affected person. See sections 56 and 57. Failure to implement an award or settlement is also an unfair labour practice by employers (Second Schedule, Part I, item 13), penalised under s.86(5); the text does not say how the two interact.
Disclosure of confidential information (19)
Section 61 protects certain confidential information given in conciliation; see sections 60 and 61. Sub-section (19) punishes wilful disclosure in contravention of that section, on a complaint made by or on behalf of the Trade Union or individual business affected.
The residual penalty (20)
Sub-section (20) catches any contravention "not covered under sub-sections (1) to (19)" of the Code, or the rules or regulations framed under this Code: a fine which may extend to Rs 1,00,000. There is no minimum. It is the provision under which several notice and record duties fall, including the closure notice in section 74, the muster roll in section 81 and the contribution under section 83, on the reading that none is named in (1) to (19). It also reaches breaches of the Central Rules, 2026.
Procedure
Section 85(1) lists sub-sections (3), (5), (7), (8), (9), (10), (11) and (20) for the officer-led enquiry; see sections 84 and 85 and rule 44. Offences not on that list, such as (12) to (19), go to a court on a complaint of the appropriate Government; see sections 87 and 88. Compounding under s.89 is available within its limits; see section 89 and rule 38. Rules 38 and 44 apply to Central-sphere establishments; where the State Government is the appropriate Government, the State's own rules apply.
Example. A company's draft standing orders were due and were never submitted, and this went on for forty days before it filed. Under s.86(10) the fine is Rs 50,000 to Rs 2,00,000 and, as the offence continued, an additional Rs 2,000 for each day it continued. Separately, an officer under s.85 may impose the penalty after an enquiry. If an office-bearer of a registered union fails to file the annual return, s.86(7) applies to that office-bearer, with Rs 50 per day for continuing default.
Need help facing a penalty notice?
Penalties under s.86(7) to (20) often arise from missed filings and loose records rather than from any dispute. Our legal dispute resolution team can review the notice, match it to the right sub-section and prepare a response, including a compounding application where it is open. Bring the notice, the filing record and any earlier correspondence.
Key takeaways
- Union defaults, false statements and deceptive rule copies carry fines from Rs 1,000 to Rs 20,000.
- Standing order offences: up to Rs 2,00,000, with Rs 2,000 per day for continuing default in s.86(10).
- Illegal strike (workers) and lock-out (employers) are penalised separately, with instigators and funders covered in (15) and (16).
- Breach of settlement or award: Rs 20,000 to Rs 2,00,000, or up to three months, or both, with a daily fine for continuing breach.
- Any other contravention, including the rules: fine up to Rs 1,00,000.
Read next
- Section 86(1) to (6): penalties for lay-off, retrenchment, closure and unfair labour practice
- Sections 63 and 64: illegal strikes and lock-outs
- Section 89: composition of offences
- Strikes: legal and illegal under the old Act
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.