Question

Which of the following statements is true about the employee and employer relationship
(A). Lay-off is temporary
(B). Retrenchment is temporary
(C). Lay-off is permanent
(D). Retrenchment is permanent
Choose the correct answer from the options given below:

• (A) and (B) only
• (C) and (D) only
• (B) and (C) only
• (A) and (D) only

Hint:

Remember the key difference: \textbf{Lay-off} is like a temporary pause in employment with the expectation of being called back. \textbf{Retrenchment} is a permanent end to the employment contract, often due to redundancy.

Answer 1

The Correct Option is D

Step 1: Understanding Labour Law Terminology:
The terms 'lay-off' and 'retrenchment' have specific legal meanings under the Industrial Disputes Act, 1947, and refer to different types of termination of employment.

Step 2: Defining Lay-off and Retrenchment:


Lay-off: This refers to the failure, refusal, or inability of an employer to give employment to a workman whose name is on the muster rolls, due to reasons like shortage of coal, power, raw materials, or breakdown of machinery. It is a temporary situation. The employer-employee relationship does not cease; it is merely suspended. The employee is expected to be recalled to work once the situation normalizes. Therefore, statement (A) is true and statement (C) is false.
Retrenchment: This is defined as the termination by the employer of the service of a workman for any reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action. It generally happens due to surplus labor or economic reasons. Retrenchment is a permanent termination of the employment contract. Therefore, statement (D) is true and statement (B) is false.

Step 3: Identifying the True Statements:
The true statements are (A) "Lay-off is temporary" and (D) "Retrenchment is permanent".

Step 4: Final Answer:
The correct option is (D), which includes (A) and (D).