Every industrial dispute is result of some or the other kind of discontent among working class or employers. These can be economic matters, non economic matters like refusal to grand leave, demand for work in a particular department or place, and sometimes silly ego matters also aggravate to the level of industrial dispute. Causes of industrial dispute are generally classified by experts in to economic causes and non economic causes. Some are described in detail:-



  • These include workers’ discontent regarding payment of inadequate wages or non payment of it as expected, allowances, bonus, benefits, incentives and other economic components that are part of periodic payments to workforce. Economic causes in nature include non payment of such dues and the timing of payments like delayed payments, employers tactic to withhold such dues and absence of communicating the reasons thereof.Since the cost of living index is increasing, workers generally bargain for higher wages to meet the rising cost of living index and to increase their standards of living. In 2002, 21.4% of disputes were caused by demand of higher wages and allowances. This percentage was 20.4% during 2003 and during 2004 increased up to 26.2%. In 2005, wages and allowances accounted for 21.8% of disputes.


  • Bonus has always been an important factor in industrial disputes. 6.7% of the disputes were because of bonus in 2002 and 2003 as compared to 3.5% and 3.6% in 2004 and 2005 respectively


Retrenchment and Closure:

  • Retrenchment and closure of establishment have also been an important factor which accounted for disputes. During the year 2002, disputes caused by closure were 4.1% while those caused by retrenchment and layoffs were 8.2% respectively.


  • Due an apprehension about shortfall in market demand of products produced or drill in management’s profit is predicted or when there is a cut in production due to any other reason, managements resort to lay off its workers. This layoffs lead to industrial dispute.

    Hours of Work:

  • There are legal provisions and remedies about hours of work and overtime pay. When workers are employed beyond the regulated hours of work, there are accepted practices to pay remuneration for such extra work at higher rates. Sometimes managements refuse to comply with such norms, or where there is no clearly defined norm managements refuse workers demand as excessive. This lead to industrial dispute.

Leave – Annual and Casual:

  • Not allowing leaves  have not been so important causes of industrial disputes. During 2002, 0.05% of the disputes were because of not granting leave while this percentage increased to 0.10% in 2003. During 2004, only 0.4% of the disputes were because of leaves and working hours.

Indiscipline and violence:

  • The number of disputes caused by indiscipline has shown an increasing trend. In 2002, 29.9% of disputes were caused because of indiscipline, which rose up to 36.9% in 2003. Similarly in 2004 and 2005, 40.4% and 41.6% of disputes were caused due to indiscipline respectively. During the year 2003, indiscipline accounted for the highest percentage (36.9%) of the total time-loss of all disputes, followed by cause-groups wage and allowance and personnel with 20.4% and 11.2% respectively. A similar trend was observed in 2004 where indiscipline accounted for 40.4% of disputes.

Lockout caused by a Strike:

  • A strike for any reason unacceptable to employer leads to corresponding lockout by employer. This is a situation of industrial dispute.

Management Practices:

  • Management practices also leads to industrial disputes: Management sometimes use threats and coercion regarding terms and conditions of employment and sometimes refusal to comply with settlements and awards arrived at before. Management sometimes refuse to recognize majority trade union, discuss matters with representative trade union and act in arbitrary manner. Management sometimes dismiss workers in arbitrary manner, discriminate, victimize, etc.

Trade Union Practices:

  • There are trade union practices also, which causes industrial dispute. Multiplicity of trade unions is a thing, in which management choose to discuss with some unions and the other unions refuse to accept that the settlement. This often leads to industrial disputes.Handling disciplinary action is a very critical task to be performed by the senior managers. Misconduct and other offensive behaviors often lead to decreased levels of productivity as they affect the individual performance of the employees. To manage discipline among employees, every company opts for a discipline policy which describes the approach it will follow to handle misconduct.


  • The miscellaneous factors include
  • Inter/Intra Union Rivalry
  • Charter of Demands
  • Standing orders/rules/service conditions/safety measures
  • Non-implementation of agreements and awards
  • Work Load