Lock-Out is the temporary closing of a place of employment, or the suspension of work, or the refusal by an employer to continue to employ any number of persons employed by him, as a measure of industrial coercion. Under Indian law, it is defined in Section 2(l) of the Industrial Disputes Act, 1947, and its legality is regulated by the same provisions (Sections 22, 23, and 24) that govern strikes.
Legal definition
The Industrial Disputes Act, 1947 provides the statutory definition:
Section 2(l): "Lock-out" means the temporary closing of a place of employment, or the suspension of work, or the refusal by an employer to continue to employ any number of persons employed by him.
The essential elements are: (i) the action must be temporary, not permanent (a permanent closure is governed separately under Section 25FFF); (ii) it must involve closing the place of employment, suspending work, or refusing to employ; and (iii) it must be an act of the employer. A lock-out is the employer's counterpart to a strike — both are weapons of economic coercion in the collective bargaining process.
The legality of a lock-out is governed by the same provisions as a strike. In public utility services (Section 22), an employer cannot declare a lock-out without giving 14 days' notice, before the expiry of the notice, or during the pendency of conciliation or adjudication proceedings. Section 23 extends similar prohibitions during pending proceedings to all industrial establishments. Under Section 24, a lock-out declared in contravention of these provisions is illegal.
New law equivalent: The Industrial Relations Code, 2020, Section 2(p) retains the definition of "lock-out" with identical language. The Code extends the 14-day notice requirement and the prohibition during pending proceedings to all industrial establishments.
How courts have interpreted this term
India General Navigation & Railway Co. v. Their Workmen [AIR 1960 SC 219]
The Supreme Court held that a lock-out declared in response to an illegal strike is not itself illegal. The Court observed that the employer's right to declare a lock-out is a counterpart of the workmen's right to strike, and the legality of each must be assessed on its own facts. A lock-out declared in retaliation to an existing illegal strike may be justified even without the statutory notice, provided the employer's dominant purpose is to counter the illegal action.
Management of Kairbetta Estate v. Rajamanickam [AIR 1960 SC 893]
The Supreme Court clarified the distinction between a lock-out and a suspension of work due to force majeure. A lock-out requires a deliberate decision by the employer to close the establishment or refuse employment as a measure of industrial coercion. If the closure is compelled by circumstances beyond the employer's control — such as a natural disaster or breakdown of machinery — it does not constitute a lock-out within the meaning of Section 2(l).
Jay Engineering Works Ltd. v. State of West Bengal [(1968) 1 LLJ 407 (SC)]
The Supreme Court held that the intention of the employer is relevant in determining whether a particular closure constitutes a lock-out. If the employer's dominant purpose is to compel workmen to accept certain terms of employment, the closure is a lock-out. If the dominant purpose is commercial (such as lack of orders or raw material shortage), the closure may be a lay-off or a bona fide closure, not a lock-out.
Why this matters
A lock-out is the employer's most powerful weapon in industrial relations — the ability to shut down operations and deny employment as economic pressure on workmen. Its legal significance lies in the symmetry with strikes: just as the law regulates when workmen may strike, it equally regulates when employers may lock out.
For employers, the critical question is whether the lock-out complies with the statutory conditions. An illegal lock-out not only exposes the employer to penalties under Section 26 but also creates an obligation to pay wages for the period of the illegal lock-out. In establishments employing 100 or more workmen, prior government permission is required under Section 22(1) read with Chapter VB before declaring a lock-out.
For workmen, the distinction between a lock-out and a lay-off has significant financial consequences. During a lay-off, workmen are entitled to lay-off compensation under Section 25C (50% of basic wages and dearness allowance). During an illegal lock-out, they are entitled to full wages. During a legal lock-out, no wages are payable unless the lock-out is found to be unjustified.
Related terms
Opposite concept:
Broader concepts:
Related employer actions:
Frequently asked questions
What is the difference between a lock-out and a closure?
A lock-out is a temporary measure intended to coerce workmen into accepting certain terms, with the intention of reopening the establishment once the dispute is resolved. A closure under Section 25FFF is the permanent closing down of the undertaking. The employer's intention is the decisive factor: if the employer intends to resume operations, it is a lock-out; if the closure is permanent, it is governed by the closure provisions.
Is the employer required to pay wages during a lock-out?
If the lock-out is illegal (i.e., declared in contravention of Sections 22 or 23), the employer must pay full wages for the lock-out period. If the lock-out is legal, no wages are payable unless the lock-out is found to be unjustified by the adjudicatory body. The distinction between legality and justifiability mirrors the position for strikes.
Can a lock-out be declared in response to a strike?
Yes. Courts have held that a lock-out declared in response to an illegal strike is not itself illegal. In India General Navigation v. Their Workmen (1960), the Supreme Court upheld a lock-out that was a direct response to an ongoing illegal strike.
This entry is part of the Veritect Indian Legal Glossary, a comprehensive reference of Indian legal terminology grounded in statutory text and judicial interpretation.
Last updated: 2026-03-27. Veritect provides this content for informational purposes and does not constitute legal advice.