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: Labour Law Terminology:
'Lay-off' and 'retrenchment' are distinct legal terms under the Industrial Disputes Act, 1947, defining different employment terminations.

Step 2: Defining Lay-off and Retrenchment:

Lay-off: An employer's failure, refusal, or inability to employ a workman on the muster rolls due to factors like resource shortages or machinery breakdown. It's a temporary suspension of employment; the employee-employer relationship continues. The employee is typically recalled when conditions improve. Therefore, statement (A) is true and statement (C) is false.
Retrenchment: Employer termination of a workman's service for any reason, excluding disciplinary action. It commonly arises from surplus labor or economic factors. Retrenchment permanently ends the employment contract. Therefore, statement (D) is true and statement (B) is false.

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

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