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Section 41: Power of Government to exempt

The Industrial Relations Code, 2020 (Act No. 35 of 2020) • Official Statutory Text & Plain English Practice Guide

Statutory Mandate
Chapter V: Notice of Change
Competent Labour Forum
Act No. 35 of 2020
Section 40 All 104 Sections of Industrial Relations Code, 2020 Section 42

Legal Commentary & Landmark Judgments: Section 41

Section 41 of the Industrial Relations Code, 2020 authorizes the appropriate Government to exempt any class of industrial establishments or any class of workers from the mandatory notice of change requirements under Section 40 upon forming the opinion that its application would cause serious prejudice.

  • Objective Threshold of 'Serious Prejudice': The statutory exercise of exemption power requires the Government to form a bona fide, objective opinion on record that enforcing the 21-day notice requirement would inflict grave disruption or irremediable injury upon the industry or public interest.
  • Class-Based Categorical Application: Exemption can only be conferred upon a designated class of industrial establishments or class of workers; individual employer dispensations granted on arbitrary grounds violate the equality clause under Article 14.
  • Official Gazette Promulgation Mandate: Exemptions must be published via formal notification in the Official Gazette, ensuring institutional transparency and enabling affected unions to challenge the vires or factual basis.
Key Landmark Precedents:
  • State of West Bengal v. Anwar Ali Sarkar AIR 1952 SC 75: Constitution Bench held that statutory provisions conferring executive discretion to classify or exempt must contain clear legislative policy guiding administrative assessment to satisfy Article 14.
  • P.J. Irani v. State of Madras AIR 1961 SC 1731: Supreme Court established that where the executive exercises an exemption power without demonstrating the requisite statutory criteria of hardship or prejudice, the notification is liable to be quashed as an abuse of power.
Courtroom Practice & Strategic Litigation Guidance:

In crisis situations (such as sudden supply chain collapses or essential public utility disruptions), an industry association petitioning for Section 41 exemption must furnish granular empirical data showing that observing the 21-day statutory notice would cause catastrophic operational closure. Document the absence of malice and prepare to defend the notification against trade union writ petitions.

Section 40 All 104 Sections of Industrial Relations Code, 2020 Section 42