Conciliation: Meaning, Procedure & Importance | Bail Me Out


    The industrial development is increasing at a huge rate, and with that there has been an equal increase in the disputes among employers and employees due to facilitation of their individual interests. Sometimes the disputes cannot be solved within the company so the state has to become the mediator between the employer and employee as due to these disputes the monetary benefits of the nation is being harmed.

    In such situations where both the parties should benefit from the decision the best way to resolve the situation is by conciliation.


    Conciliation is an alternative dispute resolution (ADR) process whereby the parties to a dispute use a conciliator, who meets with the parties both separately and together in an attempt to resolve their differences. They do this by lowering tensions, improving communications, interpreting issues, encouraging parties to explore potential solutions and assisting parties in finding a mutually acceptable outcome.

    Conciliation under the Industrial Disputes Act,1947

    Section 4 of Industrial Disputes Act, 1947 authorizes the appropriate government to engage such number of persons as may be deemed necessary by notification in the Official Gazette as conciliation officers, for discharging the responsibility of mediating in and promoting the settlement of industrial disputes.

    Why is a conciliation officer needed?

    1. To remove the contrasts between the two parties.

    2. To persuade the two parties to think in a way that depends on a methodology of compromise.

    3. To persuade both the parties to essentially arrive at an answer and avoid forcing his perspective.

    Such conciliation officers have the same powers as that of a common court. It is relied upon out of him to give a judgment within 14 days of initiation of conciliation procedures. The judgment given by such an individual will be authoritative for both of the parties.

    Duties of a conciliation officer

    Section 12 of Industrial Dispute Act, 1947 provides duties of conciliation officers. A conciliation officer is required to investigate without delay the industrial disputes and make efforts to settlement thereof and for the purpose of bringing about a settlement of the dispute he may do all such things as he deems fit for the purpose of bringing parties to come to a fair and amicable settlement of the disputes.

    These are the duties of the conciliator:

    1. The conciliation officer shall, for the purpose of bringing about a settlement of the dispute, without delay, investigate the dispute and all matters affecting the merits and the right settlement thereof and may do all such things as he thinks fit for the purpose of inducing the parties to come to a fair and amicable settlement of the dispute.

    2. If a settlement of the dispute or of any of the matters in dispute is arrived at in the course of the conciliation proceedings the conciliation officer shall send a report thereof to the appropriate government 84[or an officer authorized in this behalf by the appropriate government] together with a memorandum of the settlement signed by the parties to the dispute.

    3. If no such settlement is arrived at , the conciliation officer shall, as soon as practicable after the close of the investigation, send to the appropriate Government a full report setting forth the steps taken by him for ascertaining the facts and circumstances relating to the dispute and for bringing about a settlement thereof, together with a full statement of such facts and circumstances, and the reasons on account of which, in his opinion, a settlement could not be arrived at.

    4. If, on a consideration of the report referred to, the appropriate government is satisfied that there is a case for reference to a Board, [ Labour Court, Tribunal or National Tribunal], it may make such reference. Where the appropriate government does not make such a reference it shall record and communicate to the parties concerned its reasons therefor.

    5. A report under this section shall be submitted within fourteen days of the commencement of the conciliation proceedings or within such shorter period as may be fixed by the appropriate government.

    Importance of Conciliation

    1. One of the most important features of Conciliation is confidentiality. Section 69 of the 1996 Act allows the conciliator to talk and discuss with each party separately. Section 70 prohibits the conciliator from divulging to the other party any fact or information given to him by a party who gave the information with a specific condition that it be kept confidential.
    2. Section 73 of 1996 Act asserts that the agreement of settlement signed by the parties in dispute shall be final and binding on the parties. According to Section 74 of the 1996 Act the settlement agreement has the same status as that of an arbitral award which therefore means that it has the status of a decree of a court of law.
    3. The conciliator is often an expert in the disputed field.
    4. Conciliation proceedings are more economical as compared to litigation.
    5. The parties to the dispute have the liberty to approach the court of law, if unsatisfied with the proceeding.


    The introduction of conciliation as a means of alternate dispute resolution in the Act is definitely a positive step towards encouraging parties to opt for it. Taking into consideration the time effort and money involved in pursuing cases before a court or an arbitrator in India, conciliation should act as the perfect means for resolving disputes, especially those of commercial nature.