25F. Conditions precedent to retrenchment of workmen.—No workman employed in any industry
who has been in continuous service for not less than one year under an employer shall be retrenched by
that employer until—
(a) the workman has been given one month’s notice in writing indicating the reasons for
retrenchment and the period of notice has expired, or the workman has been paid in lieu of such
notice, wages for the period of the notice;
1
* * * * *
(b) the workman has been paid, at the time of retrenchment, compensation which shall be
equivalent to fifteen days' average pay 2[for every completed year of continuous service] or any part
thereof in excess of six months; and
(c) notice in the prescribed manner is served on the appropriate Government 3[or such authority
as may be specified by the appropriate Government by notification in the Official Gazette].
STATE AMENDMENT
Union Territory of Jammu and Kashmir and Ladakh
Section 25F.—In clause
(b), for "fifteen days", substitute "thirty days"
[Vide Union Territory of Jammu and Kashmir Reorganisation (Adaptation of Central Laws) Second
Order, 2020, Notification No. S.O. 3465(E), dated (5-10-2020) and Vide Union Territory of Ladakh
Reorganisation (Adaptation of Central Laws) Order, 2020, Notification No. S.O. 3774(E), dated
(23-10-2020).]
4
[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:
Provided that nothing in this section shall apply to a workman in any case where there has been a
change of employers by reason of the transfer, if—
(a) the service of the workman has not been interrupted by such transfer;
1. The proviso omitted by Act 49 of 1984, s. 3 (w.e.f. 18-8-1984).
2. Subs. by Act 36 of 1964, s. 14, for “for every completed year of service” (w.e.f. 19-12-1964).
3. Ins. by s. 14, ibid. (w.e.f. 19-12-1964).
4. Subs. by Act 18 of 1957, s. 3, for section 25FF (w.e.f. 28-11-1956).
38
(b) the terms and conditions of service applicable to the workman after such transfer are not in
any way less favourable to the workman than those applicable to him immediately before the transfer;
and
(c) the new employer is, under the terms of such transfer or otherwise, legally liable to pay to the
workman, in the event of his retrenchment, compensation on the basis that his service has been
continuous and has not been interrupted by the transfer.
1
[25FFA. Sixty days’ notice to be given of intention to close down any undertaking.—
(1) An
employer who intends to close down an undertaking shall serve, at least sixty days before the date on
which the intended closure is to become effective, a notice, in the prescribed manner, on the appropriate
Government stating clearly the reasons for the intended closure of the undertaking:
Provided that nothing in this section shall apply to—
(a) an undertaking in which—
(i) less than fifty workmen are employed, or
(ii) less than fifty workmen were employed on an average per working day in the preceding
twelve months,
(b) an undertaking set up for the construction of buildings, bridges, roads, canals, dams or for
other construction work or project.
(2) Notwithstanding anything contained in sub-section
(1), the appropriate Government may, if it is
satisfied that owing to such exceptional circumstances as accident in the undertaking or death of the
employer or the like it is necessary so to do, by order, direct that provisions of sub-section
(1) shall not
apply in relation to such undertaking for such period as may be specified in the order.]
25FFF. Compensation to workmen in case of closing down of undertakings.—
(1) Where an
undertaking is closed down for any reason whatsoever, every workman who has been in continuous
service for not less than one year in that undertaking immediately before such closure shall, subject to the
provisions of sub-section
(2), be entitled to notice and compensation in accordance with the provisions of
section 25F, as if the workman had been retrenched:
Provided that where the undertaking is closed down on account of unavoidable circumstances beyond
the control of the employer, the compensation to be paid to the workman under clause
(b) of section 25F
shall not exceed his average pay for three months.
2
[Explanation.—An undertaking which is closed down by reason merely of—
(i) financial difficulties (including financial losses); or
(ii) accumulation of undisposed of stocks; or
(iii) the expiry of the period of the lease or licence granted to it; or
(iv) in a case where the undertaking is engaged in mining operations, exhaustion of the minerals
in the area in which such operations are carried on;
shall not be deemed to be closed down on account of unavoidable circumstances beyond the control of the
employer within the meaning of the proviso to this sub-section.]
3
[(1A) Notwithstanding anything contained in sub-section
(1), where an undertaking engaged in
mining operations is closed down by reason merely of exhaustion of the minerals in the area in which
such operations are carried on, no workman referred to in that sub-section shall be entitled to any notice
or compensation in accordance with the provisions of section 25F, if—
(a) the employer provides the workman with alternative employment with effect from the date of
closure at the same remuneration as he was entitled to receive, and on the same terms and conditions
of service as were applicable to him, immediately before the closure;
(b) the service of the workman has not been interrupted by such alternative employment; and
(c) the employer is, under the terms of such alternative employment or otherwise, legally liable to
pay to the workman, in the event of his retrenchment, compensation on the basis that his service has
been continuous and has not been interrupted by such alternative employment.
1. Ins. by Act 32 of 1972, s. 2.
2. Subs. by Act 45 of 1971, s. 4, for the Explanation (w.e.f. 15-12-1971).
3. Ins. by s. 4, ibid. (w.e.f. 15-12-1971).
39
(1B) For the purposes of sub-sections
(1) and (1A), the expressions “minerals” and “mining
operations” shall have the meanings respectively assigned to them in clauses
(a) and
(d) of section 3 of
the Mines and Minerals (Regulation and Development) Act, 1957 (67 of 1957).]
(2) Where any undertaking set-up for the construction of buildings, bridges, roads, canals, dams or
other construction work is closed down on account of the completion of the work within two years from
the date on which the undertaking had been set-up, no workman employed therein shall be entitled to any
compensation under clause
(b) of section 25F, but if the construction work is not so completed within two
years, he shall be entitled to notice and compensation under that section for every 1[completed year of
continuous service] or any part thereof in excess of six months.]
