IMPORTANT LABOUR AND FACTORY LEGISLATIONS IN INDIA

1. IMPORTANT LABOUR AND FACTORY LEGISLATIONS IN INDIA Raghubar Jha Raghubar Jha

2. Acts and Rules • Blend of Acts and Rules • Centered on the responsibility of a Factory Manager, Personnel/ HR Manager or self employed Entrepreneur. • Attention has not been made wherever the employer has nothing to do with the provisions but has only to follow the directions of the appropriate govt. Raghubar Jha

3. THE FACTORIES ACT, 1948 • Act which makes it obligatory on the part of the employer to provide for the health, safety and welfare of the workers employed. Raghubar Jha

4. Act extends to the whole of India. • Applies to every factory wherein 10 or more workers are or were employed, if run with power and 20 or more workers are or were employed, if run without power. • Application to factories with fewer workers u/s 85 Raghubar Jha

5. PROVIDES for • Hours of work (adult) not to exceed 48 hours in a week or 9 hours in a day. • Relaxation: Where an adult worker is engaged in urgent repairs. • Payment of Overtime wages for overstay at workplace @ twice the ordinary rate of wages. • ** Provision relating to hours of work not applicable to supervisory staff. • Weekly Holiday: No work for more than 10 days without a day of rest. • Intervals of rest: half an hour for 5 hours of work • No child (who has not attained the age of 15 years) be permitted to work. • Prohibition of employment of Women: No woman shall be employed in any factory for more than 9 hours in any day or between 7 pm and 6 am. Raghubar Jha

6. Factories Act now allows women to work night shifts PROVIDED • adequate safeguards in the factory as regards occupational safety and health, equal opportunity for women workers, adequate protection of their dignity, honor and safety and their transportation from the factory premises to the nearest point of their residence" are made. Raghubar Jha

7. Leave with Wages • @ 1day for every 20 days provided ----- 240 days of work during preceding year. • Days of lay off, paid holidays or leave days considered • Encashment of unavailed leave: Encashable at the present rate of wages. Raghubar Jha

8. The occupier (Employer) to maintain a register – LEAVE WITH WAGES REGISTER- in FORM 15 • Provide each employee a Leave Book- thick bound sheet- in FORM 16 (with similar entries as in Form 15) • Provide each worker an Attendance Card in form 28 showing the particulars of employment * shall be substituted by Electronic cards Raghubar Jha

9. EMPLOYER TO KEEP THE FACTORY PREMISES CLEAN • white washing at least once in every 14 months • repainting or revarnishing every 5 years • ensure proper disposal of wastes and effluents • Record the dates on which white washing, painting or varnishing done in a register in FORM 7. • Ensure provision of sufficient number of Latrines and urinals – separate for gents and ladies • Ensure spittoons are provided at adequate places. • Ensure workplace has adequate ventilation • Avoid overcrowding – ensure 500 cubic feet of space for every worker without reference to any space which is more than 14 feet above the level of the floor of the room. • Ensure proper lighting- artificial or natural or both. • Ensure supply of uninterrupted supply of Drinking Water. • Where the no. of workers is more than 250, provision for cold water in every lunch room, rest room and canteen shall be ensured. Raghubar Jha

10. EMPLOYER TO ENSURE SAFETY OF WORKERS • Fencing of Machines and Moving parts of machines – spindles, gears, pulleys, belts etc • Protection of eyes using screens or goggles from excessive light or infra-red or ultra violet radiations • Precaution in case of Fire. • No woman or young person shall, unaided by another person, lift, carry or move by hand or head any material or tool exceeding the maximum limit prescribed. • * Adult male 75 Kgs • * Adult female 30 Kgs • * Adolescent male 30 Kgs • * Adolescent female 20 Kgs • Safety Officer: Appoint a Safety Officer wherein 1000 or more workers are employed. Raghubar Jha

11. EMPLOYER TO LOOK AFTER THE WELFARE OF EMPLOYEES • Washing facility separately for women and men • Separate rooms for men and women for drying of clothes • Separate rest rooms for men and women • First Aid boxes equipped with prescribed medicines • Ambulance room where 500 or more are employed • Canteen for use of workers where 250 or more are employed (150 under Plantation Labour Act) • Lunch room where 150 or more are employed • Crèches where 30 or more women are employed • Appoint WELFARE OFFICER (S) where 500 or more are employed (300 under PLA) • The duties, qualification and conditions of service of such welfare officers shall be in accordance with the rules of the respective State Govt. • NOTICE OF DANGEROUS OPERATIONS Raghubar Jha

12. REGISTERS TO BE MAINTAINED • Attendance Register/ Muster roll in form 25 • Register of Adult Workers in form 12 • Record of Lime washing, painting etc in form 7 • Register of Compensatory Holidays in form 9 • Overtime Muster roll for Exempted workers in form 10 • Register of Leave with Wages in form 15 • Health Register in form 17 (in respect of persons employed in occupations declared to be dangerous operations u/s 87) • Register of Accidents and Dangerous Occurrences in form 26 • Particulars of Rooms in the factory in form 35. Raghubar Jha

13. RETURNS TO BE SENT TO APPROPRIATE AUTHORITIES • Notice of accidents and dangerous occurrences resulting in death or bodily injury in form 18(similar to the one to be sent ESI Local Office under the ESI Act) • Half yearly returns in form 22 • Annual returns in form 21 • Notice of change of Manager in form 23 • Details of closure in form 32 • Report of examination of Pressure Vessel or Plant in form 8 • Report of examination of Water sealed Gas holder in form 38 • Report of Examination of Hoist or Lift in form 41 • Certificate of Fitness for Dangerous Operations in form 39 Raghubar Jha

14. THE INDUSTRIAL EMPLOYMENT (STANDING ORDER) ACT, 1946 • Defines the terms and conditions of service between the employer and his employees. • Applies to every industrial establishment wherein 100 (in some States 50)or more workers are employed • The Act extends to the whole of India Raghubar Jha

15. SIGNIFICANCE • Terms of appointment order issued to an employee cannot circumvent the provisions of certified standing order. Therefore, it is always desirable to get standing orders drafted and certified as it regulates the relationship between the employer and the employee. Raghubar Jha

16. Standing Order drafted shall provide for • Date on which the standing orders shall come in to force and shall remain in force • Definitions • Classification of workmen as Permanent, Probationer, Badlis, Casual and Trainees Raghubar Jha

17. contd • Obligations – • not to carryon any other business for gain or to take admission in educational institution without permission • to observe strict secrecy of company matters • not to take photographs, drawing or documents of the process of manufacture of the company • not to carry any lethal weapon, explosive or article dangerous to life or property • to follow safety rules in force • to inform any change in the address • etc Raghubar Jha

18. contd • Medical examination and aid in case of accident • Identification of workmen and issue of Identity cards • Working time for different categories of workmen • Record of age, qualification and experience • Entry, exit and liability for security checking • Shift working and weekly off • Attendance and late coming • Methods of applying for different kinds of leave and extension of leave • Action for unauthorised absence Raghubar Jha

19. contd • National and festival holidays • Transfer • Apprehension of danger to the safety and security of factory and its personnels • Date of payment of wages/ salary • Overtime wages • Increment and promotion • Stoppage, closing or lay off of establishment and strike • Resignation – notice or payment in lieu of notice to be given • Termination of employment and notice or payment in lieu of notice required to be served or made Raghubar Jha

20. contd • Deduction from wages for fine imposed or absence from duty or loss caused to the property and recovery of employees contribution to schemes like EPF, ESI and Labour Welfare fund • Age of superannuation • Grievance procedure • Disciplinary action for misconduct • Punishment for misconduct and procedure for imposition of punishment Raghubar Jha

21. contd • Service of notice • Issue of service certificate • Amendment of Standing order • Exhibition of Notices – as whether if put in the Notice Board or not Raghubar Jha

22. THE MATERNITY BENEFIT ACT, 1961 • The Act extends to the whole of India except Jammu & Kashmir • Applies to every factory, shop or establishment • Woman entitled to maternity benefit not withstanding the application of the Employees State Insurance Act, 1948 Raghubar Jha

23. Employer to ensure…… • No woman works during the six weeks immediately following the day of her delivery or her miscarriage • No woman does any arduous work during the period of ten weeks from the expected date of delivery • Not to discharge or dismiss a woman during her pregnancy Raghubar Jha

24. Eligibility • Work of 160 days in the 12 months immediately preceding the date of delivery. • Leave days & lay offs taken as worked. Raghubar Jha

25. Benefit • 12 weeks leave of which not more than 6 weeks shall precede the date of her expected delivery • The benefit to be paid @ average rate of wages for the three months preceding her maternity leave • In case of miscarriage, 6 weeks leave with pay at the same rate as applicable to maternity benefit. Raghubar Jha

26. THE MINIMUM WAGES ACT, 1948 • AN ACT TO PREVENT “SWEATED LABOUR AND EXPLOITATION OF LABOUR” • The Act extends to the whole of India • Requires the Central and State Govt. to fix minimum rates of wages in certain scheduled employment. • Minimum wages fixed REVISED from time to time Raghubar Jha

27. Responsibility of the Employer • to follow the directions and fix wages of the workers at the rate not less than the one fixed • to maintain Register of Wages in form XI showing rate of wages payable, actual amount paid, attendance & overtime, deductions for EPF, ESI and other, net amount paid, date of payment and signature of respective employee. • Wages slip in form XIII showing the above details to be given to every employee. Raghubar Jha

28. THE WORKING JOURNALISTS (FIXATION OF RATES OF WAGES) ACT, 1958 Provides for the fixation of wages in respect of Working Journalists and for matters connected therewith Raghubar Jha

29. PAYMENT OF WAGES ACT, 1936 • An Act to regulate the payment of wages to certain classes of persons • Extends to the whole of India • Responsibility of payment wages rests with the employer • Employer to fix Wage Period • No wage period shall exceed one month. Raghubar Jha

30. Time of Payment of wages • 7th day of wage month where less than 1000 are working • 10th day where more than 1000 are working • No payment in KIND Raghubar Jha

31. Permissible deduction from Wages • fines • for absence from duty • for damage caused to the property of the employer • for the amenities provided, like house accommodation • for recovery of advance or adjusting over payment of wages • towards EPF, ESI, Labour Welfare Fund and similar deductions permitted under any Act or the Standing Orders of the establishment • for Life Insurance/ general insurance policies and Housing loan. Raghubar Jha

32. The Kerala Payment of Subsistence Allowance Act, 1972 • Act to provide for the payment of subsistence allowance to the employees during the period of suspension • Extends to the whole of Kerala Raghubar Jha

33. Suspension • Any interim decision of an employer debarring an employee temporarily from attending his office Raghubar Jha

34. Payment of Subsistence Allowance • 50% of wages for the first ninety days of suspension • 75% of wages for the period beyond ninety days • Full wages for the period beyond one hundred and eighty days Raghubar Jha

35. Not eligible for Subsistence Allowance • An employee placed under suspension not entitled for subsistence allowance if he accepts employment during the period of suspension Raghubar Jha

36. THE PAYMENT OF BONUS ACT, 1965 • An Act to provide for the payment of Bonus to persons in certain establishments on the basis of profits, production or productivity. • Extends to the whole of India. • Applies to every establishment wherein 20 or more are employed • The Appropriate Govt. shall apply the Act to any other establishment, including a factory to which the Factories Act, 1948 applies, wherein less than 20 workers are employed provided the number of persons employed is not less than 10. Raghubar Jha

37. Eligibility to Bonus • employee whose salary/ wages does not exceed Rs 10000 per month • who has worked in the establishment for not less than 30 days • Not disqualified to claim bonus due to fraud, theft or any other misconduct • Bonus of veryperson drawing salary between Rs 3500/- and Rs 10000/- per month shall be calculated as if his salary were Rs 3500 pm Raghubar Jha

38. For calculating the number of working days • the days for which the worker has been laid off • the days he has been on leave with pay • the days he has been absent due to temporary disablement caused by an employment injury • the days a woman employee has been on maternity leave shall be taken in to account. Raghubar Jha

39. Rate of Bonus • Minimum :8.33% of salary/wages • Maximum 20% of salary/wages • Computation of bonus as per Schedule I to IV of the Act. • Adjust any interim bonus paid while making payment of the final bonus. Raghubar Jha

40. Disputes on Bonus • The Bonus Act does not provide for any machinery to resolve disputes relating to bonus. For this, the Industrial Dispute Act shall be referred to. Raghubar Jha

41. THE PAYMENT OF GRATUITY ACT, 1972 The Kerala Industrial Employees Payment of Gratuity Act, 1970, followed by the West Bengal Employees Payment of Compulsory Gratuity Act, 1971 and the intention of the other States to have similar Acts in their respective states necessitated the Central Act so as to avoid different treatment to employees of establishments having branches in more than one states who are subject to transfer from one state to another. Raghubar Jha

42. The Payment of Gratuity Act, 1972 extends to the whole of India. • Applies to every factory, mine, plantation and other establishment wherein 10 or more workers are employed. Raghubar Jha

43. Gratuity is in the nature of a retirement benefit payable to an employee for a long and meritorious service. • It is not paid to an employee gratuitously or merely as a matter of boon. It is paid for the service rendered by him to the employer (Delhi Cloth and General Mills Co; Ltd Vs The Workmen) • Then why it should necessarily be denied to him when an employee is dismissed for misconduct at a latter stage of service ??? Raghubar Jha

44. Gratuity is payable to an employee on termination of his employment after he has rendered continuous service for not less than five years • on his superannuation • on his resignation • on his death or disablement due to employment injury or disease Raghubar Jha

45. News paper employees • The Working Journalists and Other Newspaper Employees (Conditions of service) and Miscellaneous Provisions Act, 1955, provides for payment of gratuity. • As such, three years of continuous service is required for eligibility for Gratuity. Raghubar Jha

46. The payment of gratuity shall be forfeited • to the extent of the damage or loss caused by the employee to the property of the employer • where the service of the employee is terminated due to misconduct Raghubar Jha

47. Rate of gratuity • 15 days wages for every completed year of service • Rates applicable to Working Journalists depends upon the service of the employee as provided in the Working Journalists and Other Newspaper Employees (Conditions of service) and Miscellaneous Provisions Act, 1955 Raghubar Jha

48. The average pay of the monthly rated employee shall be taken by dividing the monthly salary/ wages by 26 and not by 30 Raghubar Jha

49. Piece rate workers and Seasonal establishments • For piece rated workers, average of the three months wages immediately preceding the day of leaving shall be taken as average rate of wage • An employee in a seasonal establishment shall be paid @ seven days wages for each season Raghubar Jha

50. Salary ceiling • The Amendment Act of 1994 removed the salary ceiling of an employee, but the maximum gratuity payable shall be Rs 3.5 lakh. Raghubar Jha