Redundancy and Transfers of Undertakings


Redundancy and Transfers of Undertakings

Employer has the right to retrench the “surplus labour” temporarily or by way of a layoff, or permanently, by way of retrenchment (downsizing) or closure of an undertaking.

Industrial Disputes Act, 1947 is the major law dealing with the effect of redundancy in India and provides safeguards to prevent hardship to employees and has put some restrictions on the employer’s right to retrench and lay off workers. Here we are discussing restrictions and regulations concerning the industrial redundancy of excess employees, provisions regarding retrenchments, layoffs, and related payment of compensation to workers under certain contingencies.

Further, we have discussed the rights of employees and the obligation of the employers in case of transfer of the business entity where there is a change of ownership and control of a business.

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