A Handbook on Labour Laws of India
Rajkumar S. Adukia
B.Com (Hons.), LL.B, AICWA, FCA
[email protected] / [email protected]
http://www.carajkumarradukia.com
093230 61049 / 093221 39642
PREFACE
“To secure to each labourer the whole product of his labour, or as nearly as possible, is a worthy object of any good Government” said Abraham Lincoln.
Industrialisation poses a challenge for an entrepreneur in the form of management of the resources. The management and effective and efficient deployment of the resources of the organisation is the factor which decides the profitability and viability of any organisation .Labour is one of the basic resources of any industry and has an important bearing on the performance and goals of the organisation. In India we have a plethora of Laws which deals with issues concerning Labour administration, labour welfare, regulation of industrial relations between the management and the workers. For the effective and efficient management of labour in an industry or an organisation it is necessary to have a complete knowledge of the Laws, bye laws, regulations and ordinances applicable to the industry in general and to the company or organisation specifically. The laws and bye laws applicable to labour issues and interests provides for various compliances in accordance with procedures laid therein. This book provides a brief insight into the Laws, bye laws, Regulations, notifications applicable to labour and labour issues.
The salient features of the Central Labour Acts in force in India are given here under: The Indian Factories Act of 1948 provides for the health, safety and welfare of the workers. The Shops and Commercial Establishment Act regulates the conditions of work and terms of employment of workers engaged in shops, commercial establishments, theatres, restaurants, etc. The Maternity Benefit Act provides for the grant of cash benefits to women workers for specified periods before and after confinements. The Employment of Children Act, 1938, prohibits the employment of young children below the age of 15 years in certain risky and unhealthy occupations. The payment of wages Act, 1936, regulates the timely payment of wages without any unauthorized deductions by the employers. The Minimum Wages Act, 1948, ensures the fixation and revision of minimum rates of wages in respect of certain scheduled industries involving hard labour. The Industrial Disputes Act, 1947, provides for the investigation, and settlement of industrial disputes by mediation, conciliation, adjudication and arbitration, there is scope for payment of compensation in cases of lay-off and retrenchment. The Industrial Employment (Standing Orders) Act, 1946, requires employers in Industrial establishments to define precisely the conditions of employment under them and make them known to their workmen. These rules, once certified, are binging on the parties for a minimum period of six months. The Workmen’s Compensation Act, 1923, provides for compensation to injured workmen of certain categories and in the case of fatal accidents to their dependants if the accidents arose out of and in the course of their employment. It also provides for payment of compensation in the case of certain occupational diseases. The Indian Trade Unions Act, 1926, recognizes the right of workers to organise into trade unions, and when registered, they have certain rights and obligations and function as autonomous bodies. The Employees’ State Insurance Act, 1948, provides for sickness benefit, maternity benefit, disablement benefit and medical benefit. The Employees’ Provident Fund Act, 1952, seeks to make a provision for the future of industrial worker after he retires or in case he is retrenched, or for his dependents in case of his early death.
The labour welfare work, thus, covers a wide range of activities and in its present form is widely recognised and is regarded as an integral part of the industrial system and management.
This book retains my original three aims: (i) to provide a clear and precise explanation of the meaning of a particular word or phrase; (ii) to help the employer as well as the employee find answers to many of the questions that might crop up during a dispute or problem; (iii) to identify where a problem might occur upon which, when required, further advice and counsel should be sought.
I shall appreciate further questions from our readers and all concerned on various issues so that they can be included in our future edition or replied through email [email protected].
We will appreciate if our readers can give suggestions and criticism and call our attention to errors which might have inadvertently crept in. Alternatively, the readers can also post their queries at http://www.carajkumarradukia.com. I would be glad to receive your queries or suggestions. Those who are Interested in getting similar technical material on a regular basis can send an email to [email protected] and subscribe to our yahoo group.
TABLE OF CONTENTS
Part 1
Introduction
1.1 What is Labour Law?
1.2 Classification of Various Labour Laws
1.3 Labour Jurisdiction- State vs Central
1.4 Labour Policy of India
Part 2
Central Labour Laws
2.1 The Factories Act, 1948
2.2 Child Labour (Prohibition and Regulation) Act, 1986
2.3 Bonded Labour System (Abolition) Act, 1976
2.4 The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959
2.5 Apprentices Act, 1961
2.6 Employees Provident Fund and Miscellaneous Provisions Act, 1952
2.7 The Employees State Insurance Act (ESI Act), 1948
2.8 Payment of Gratuity Act, 1972
2.9 Payment of Bonus Act, 1965
2.10 Payment of Wages Act, 1936
Part 3
Labour Law Concessions
3.1 Labour Laws and SSI
3.2 Labour Laws and SEZ
Part 4
Which court to approach in case of a labour dispute?
4.1 Judicial System in India
4.2 Where to file?
4.3 What matters fall within the jurisdiction of Industrial Tribunals?
4.4 What matters fall within the Jurisdiction of Labour Courts?
4.5 Stages of adjudication in labour or industrial disputes
4.6 Mediation in Labour Disputes
Part 5
5.1 Address of Labour Commissioners
5.2 About the Author
Part 1
Introduction
Wikipedia, the internet encyclopedia defines labour law as “Labour Law is the body of laws, administrative rulings, and precedents which address the relationship between and among employers, employees, and labor organizations, often dealing with issues of public law”. The terms Labour Laws and Employment Laws, are often interchanged in the usage. This has led to a big confusion as to their meanings. Labour Laws are different from employment laws which deal only with employment contracts and issues regarding employment and workplace discrimination and other private law issues.
Employment Laws cover broader area than labour laws in the sense that employment laws cover all the areas of employer/employee relationship except the negotiation process covered by labour law and collective bargaining.
Labour Laws harmonize many angles of the relationship between trade unions, employers and employees. In some countries (like Canada), employment laws related to unionised workplaces are different from those relating to particular individuals. In most countries however, no such distinction is made.
The final goal of labour law is to bring both the employer and the employee on the same level, thereby mitigating the differences between the two ever-warring groups.
Origins of Labour Laws
Labour laws emerged when the employers tried to restrict the powers of workers' organisations and keep labour costs low. The workers began demanding better conditions and the right to organise so as to improve their standard of living. Employer’s costs increased due to workers demand to win higher wages or better working conditions. This led to a chaotic situation which required the intervention of Government. In order to put an end to the disputes between the ever-warring employer and employee, the Government enacted many labour laws.
In India the labour laws are so numerous, complex and ambiguous that they promote litigation rather than the resolution of problems relating to industrial relations. The labour movement has contributed a lot for the enactment of laws protecting labour rights in the 19th and 20th centuries. The history of labour legislation in India can be traced back to the history of British colonialism. The influences of British political economy were naturally dominant in sketching some of these early laws. In the beginning it was difficult to get enough regular Indian workers to run British establishments and hence laws for chartering workers became necessary. This was obviously labour legislation in order to protect the interests of British employers.
The British enacted the Factories Act with a really self-centered motive. It is well known that Indian textile goods offered serious competition to British textiles in the export market. In order to make India labour costlier, the Factories Act was first introduced in 1883 because of the pressure brought on the British parliament by the textile moguls of Manchester and Lancashire. Thus we received the first stipulation of eight hours of work, the abolition of child labour, and the restriction of women in night employment, and the introduction of overtime wages for work beyond eight hours. While the impact of this measure was clearly for the welfare of the labour force the real motivation was undoubtedly the protection their vested interests.
India provides for core labour standards of ILO for welfare of workers and to protect their interests. India has a number of labour laws addressing various issues such as resolution of industrial disputes, working conditions, labour compensation, insurance, child labour, equal remuneration etc. Labour is a subject in the concurrent list of the Indian Constitution and is therefore in the jurisdiction of both central and state governments. Both central and state governments have enacted laws on labour issues. Central laws grant powers to officers under central government in some cases and to the officers of the state governments in some cases.
There are over 45 legislations on labour from the Central Government and the number of legislations enacted by the State Governments is close to four times that of the Central Acts.
Labour Laws can be classified into the following eight categories:
(i) Laws related to Industrial Relations
(ii) Laws related to Wages
(iii) Laws related to Specific Industries
(iv) Laws related to Equality and Empowerment of Women
(v) Laws related to Deprived and Disadvantaged Sections of the Society
(vi) Laws related to Social Security
(vii) Laws related to Employment & Training
(viii) Others
Laws related to Industrial Relations
1 The Trade Unions Act, 1926
2 The Industrial Employment (Standing Orders) Act, 1946
The Industrial Employment (Standing Orders) Rules, 1946
3 The Industrial Disputes Act, 1947
Laws related to Wages
1 The Payment of Wages Act, 1936
The Payment of Wages Rules, 1937
2 The Minimum Wages Act, 1948
The Minimum Wages (Central) Rules, 1950
3 The Working Journalist (Fixation of Rates of Wages) Act, 1958
Working Journalist (Conditions of service) and Miscellaneous Provisions Rules, 1957
4 The Payment of Bonus Act, 1965
The Payment of Bonus Rules, 1975
Laws related to Specific Industries
1 The Factories Act, 1948
2 The Dock Workers (Regulation of Employment) Act, 1948
3 The Plantation Labour Act, 1951
4 The Mines Act, 1952
5 The Working Journalists and other Newspaper Employees’ (Conditions of Service and Misc. Provisions) Act, 1955
The Working Journalists and other Newspaper Employees’ (Conditions of Service and Misc. Provisions) Rules, 1957
6 The Merchant Shipping Act, 1958
7 The Motor Transport Workers Act, 1961
8 The Beedi & Cigar Workers (Conditions of Employment) Act, 1966
9 The Contract Labour (Regulation & Abolition) Act, 1970
10 The Sales Promotion Employees (Conditions of Service) Act, 1976
The Sales Promotion Employees (Conditions of Service) Rules, 1976
11 The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979
12 The Shops and Establishments Act
13 The Cinema Workers and Cinema Theatre Workers (Regulation of Employment) Act, 1981
The Cinema Workers and Cinema Theatre Workers (Regulation of Employment) Rules, 1984
The Cine Workers’ Welfare Fund Act, 1981.
14 The Dock Workers (Safety, Health & Welfare) Act, 1986
15 The Building & Other Construction Workers (Regulation of Employment & Conditions of Service) Act, 1996
16 The Dock Workers (Regulation of Employment) (inapplicability to Major Ports) Act, 1997
17 The Mica Mines Labour Welfare Fund Act, 1946
18 The Limestone & Dolomite Mines Labour Welfare Fund Act, 1972
19 The Beedi Workers Welfare Fund Act, 1976
20 The Beedi Workers Welfare Cess Act, 1976
21 The Iron Ore Mines, Manganese Ore Mines & Chrome Ore Mines Labour Welfare Fund Act, 1976
22 The Iron Ore Mines, Manganese Ore Mines & Chrome Ore Mines Labour Welfare Cess Act, 1976
23 The Cine Workers Welfare Fund Act, 1981
24 The Cine Workers Welfare Cess Act, 1981
25 The Employment of Manual Scavengers and Construction of Dry latrines Prohibition Act, 1993
26 The Coal Mines (Conservation and Development) Act, 1974
Laws related to Equality and Empowerment of Women
1 The Maternity Benefit Act, 1961
2 The Equal Remuneration Act, 1976
Laws related to Deprived and Disadvantaged Sections of the Society
1 The Bonded Labour System (Abolition) Act, 1976
2 The Child Labour (Prohibition & Regulation) Act, 1986
Laws related to Social Security
1 The Workmen’s Compensation Act, 1923
2 The Employees’ State Insurance Act, 1948
3 The Employees’ Provident Fund & Miscellaneous Provisions Act, 1952
4 The Payment of Gratuity Act, 1972
Laws related to Employment & Training
1 The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959
The Employment Exchanges (Compulsory Notification of Vacancies) Rules, 1959
2 The Apprentices Act, 1961
Others
1 The Fatal Accidents Act, 1855
2 The War Injuries Ordinance Act, 1943
3 The Weekly Holiday Act, 1942
4 The National and Festival Holidays Act
5 The War Injuries (Compensation Insurance) Act, 1943
6 The Personal Injuries (Emergency) Provisions Act, 1962
7 The Personal Injuries (Compensation Insurance) Act, 1963
8 The Labour Laws (Exemption from Furnishing Returns and Maintaining Register by Certain Establishments) Act, 1988
9 The Public Liability Insurance Act, 1991
1.3 Labour Jurisdiction-State vs Central
Under the Constitution of India, Labour is a subject in the Concurrent List where both the Central & State Governments are competent to enact legislation subject to certain matters being reserved for the Centre.