INDUSTRIAL RELATIONS -

THE PRACTICE,
THE LEGISLATION
THE GOVT MACHINERY

IIM KASHIPUR JUNE 2018

THOMAS PUTTI
INDUSTRIAL RELATIONS – THE BIRTH

• Industrial Revolution
• Working Conditions, Wages & Benefits
• Basic Rights Denied
• Oppressed class
• Unionisation
• Enactment of Labour Laws
INDUSTRIAL RELATIONS – THE PRACTICE

“Industrial relations includes securing effective and willing cooperation from

employees and reducing conflict between employers and workers and their
representatives, the trade unions”.
Indian Institute of Personnel Management
INDUSTRIAL RELATIONS – THE PRACTICE…

“Industrial relationship is the composite result of the attitude and approach of employers
and employees towards each other with regard to the planning supervision, direction and
coordination of the activities of an organization with a minimum human effort and friction
with an animating spirit of cooperation and with proper regard for genuine well being of all
the members of the organization”.
Tead & Metcalf
INDUSTRIAL RELATIONS – THE PRACTICE

• Preventive IR
• Reactive IR
INDUSTRIAL RELATIONS - UNION

• Union Vs Non Union

INDUSTRIAL RELATIONS – THE GOVERNMENT MACHINERY

• The Labour Law Enactments

• Central & State Labour Departments
INDUSTRIAL RELATIONS – LABOUR LEGISLATION

The Constitution of India

Articles 14-16, 19(1)(c), 23-24, 38, and 41-43A directly concern labour rights.
• Article 14 - Everyone should be equal before the law
• Article 15 - The state should not discriminate against citizens
• article 16 - Right of "equality of opportunity" for employment or appointment
• Article 23 - Prohibits all trafficking and forced labour,
• article 24 - Prohibits child labour
THE CONSTITUTION…

• Article 38(1) - Strive to promote the welfare of the people with a social order
• Article 38(2) - Minimise the inequalities in income
• Article 41 - Right to work - The National Rural Employment Guarantee Act 2005
• Article 43 - Living wage and conditions of work ensuring a decent standard of life
• Article 43A - Secure the participation of workers in the management of undertakings
THE INDIAN LABOUR LEGISLATION

The Labour Laws control the relationships between the worker and the company. These
laws mandate all aspects of employer-employee interaction:
• 45 National laws
• 200 State laws
• Attendance logs, accounts for overtime wages, annual returns, height of urinals in
workers' washrooms, how often a work space must be lime-washed.
• Inspectors can examine working space anytime and declare fines for violation of any
labour laws and regulations.
RECRUITMENT & EMPLOYMENT

• The Industrial Employment (Standing Orders) Act 1946

• Requires that employers have terms including working hours, leave, productivity goals,
dismissal procedures or worker classifications, approved by a government body.

• The Contract Labour (Regulation and Abolition) Act 1970

• Aims at regulating employment of contract labour so as to place it at par with labour
employed directly
COMPENSATION & BENEFITS

• The Payment of Wages Act 1936 requires that employees receive wages, on time, and
without any unauthorised deductions.
• The Minimum Wages Act 1948 sets wages for the different economic sectors that it
states it will cover. It leaves a large number of workers unregulated. Central and state
governments have discretion to set wages according to kind of work and location, and
they range between as much as ₹ 143 to 1120 per day for work in the so-called central
sphere. State governments have their own minimum wage schedules.
COMPENSATION & BENEFITS

• The Payment of Gratuity Act 1972, applies to establishments with 10 or more workers.
Gratuity is payable to the employee if he or she resigns or retires. The Indian government
mandates that this payment be at the rate of 15 days salary of the employee for each
completed year of service subject to a maximum of ₹ 2000000
• The Payment of Bonus Act 1965, which applies only to enterprises with over 20 people,
requires bonuses are paid out of profits based on productivity. The minimum bonus is
currently 8.33 per cent of salary.
• Weekly Holidays Act 1942 Beedi and Cigar Workers Act 1967
HEALTH AND WELL BEING

• The Workmen's Compensation Act 1923 requires that compensation is paid if workers are
injured in the course of employment for injuries, or benefits to dependants.
• Factories Act 1948, consolidated existing factory safety laws
• The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013 that seeks to protect and provides a mechanism for women to report incidents of
sexual harassment at their place of work.
• The Maternity Benefit Act 1961, creates rights to payments of maternity benefits for any
woman employee who worked in any establishment for a period of at least 180 days during
the 12 months immediately preceding the date of her expected delivery.
RETIRALS

• The Employees' Provident Fund and Miscellaneous Provisions Act 1952 created the
Employees' Provident Fund Organisation of India. This functions as a pension fund for old age
security for the organised workforce sector
• The Employees' State Insurance provides health and social security insurance.This was
created by the Employees' State Insurance Act 1948
• The Unorganised Workers' Social Security Act 2008 was passed to extend the coverage of life
and disability benefits, health and maternity benefits, and old age protection for unorganised
workers. "Unorganised" is defined as home-based workers, self-employed workers or daily-
wage workers. The state governments formulate the welfare system through rules produced
by the National Social Security Board
WORKPLACE RELATED

• The Industrial Disputes Act 1947 regulates how employers may address industrial
disputes such as lockouts, layoffs, retrenchment etc. It controls the lawful processes for
reconciliation, adjudication of labour disputes.
• The Trade Unions Act 1926, amended in 2001, contains rules on governance and general
rights of trade unions.
• Job Security – Fair process of dismissals
VULNERABLE GROUPS

• Equal Remuneration Act 1976

• Interstate Migrant Workmen Act 1979
• Child Labour (Prohibition and Abolition) Act 1986
AMENDMENTS & REFORMS

• Payment of Wages (Amendment) Act, 2017 enabling payment of Wages to employees by

Cash or Cheque or crediting it to their bank account.
• Child Labour (Prohibition and Regulation) Amendment Act, 2016 provides for a complete
ban on employment of children below 14 years in any occupation or process.
• Maternity Benefit Amendment Act, 2017, increases the paid maternity leave from 12
weeks to 26 weeks.
• The Employee Compensation (Amendment) Act, seeks to rationalize penalties and
strengthen the rights of the workers under the Act.
RECENT AMENDMENTS….

• Ease of Compliance to maintain Registers - Replaced the 56 Registers/Forms under 9

Central Labour Laws and Rules into 5 common Registers/Forms. (Feb 2017)
• A Model Shops and Establishments (RE&CS) Bill, 2016 has been circulated to all
States/UTs for adoption with appropriate modification. Provides for freedom to operate
an Establishment for 365 days in a year without any restriction on opening/closing time
and enables employment of women during night shifts if adequate safety provisions exist
RECENT AMENDMENTS…

• Employees’ State Insurance (ESI) Corporation raises wage limit to Rs 21,000 for coverage from Rs 15,000.
Click Here
• Amendment to the Payment of Bonus Act, 1965 by which eligibility limit for payment of bonus enhanced from
Rs 10,000/- to Rs. 21,000/- per month and the Calculation Ceiling from 3,500/- to Rs. 7,000/- or the minimum
wages.
• The Payment of Gratuity (Amendment) Bill, 2017: Under the present Gratuity Act, the maximum period of
maternity leave available to female employees is 12 weeks (for the purpose of calculation of continuous service.
The Bill amends the provision to specify that the central government may notify the maximum time period for
maternity leave.
• One Employee- One EPF Account: A facility has been provided to the members to merge their earlier PF
accounts to the current PF account to that EPFO may help them in the integrations of all these PF accounts in
the current UAN activated PF account. The said functionality has been provided on the EPFO website.
LABOUR LAW REFORMS

• A category i.e. Fixed Term Employment has been introduced under Industrial Employment
(Standing Orders) Act, 1946 to impart flexibility to an establishment to employ people.
• The government (central or state) to come up with a list of industries or other
establishments in which wages must be paid only by crediting it in the bank account or
through a cheque.
• The maternity benefits are now extended to the mothers who adopt children below the age
of three months and commissioning mothers who have a child through surrogacy. Such
mothers are entitled to a maternity benefit of twelve weeks from when the child is handed
over to them
• UMANG Mobile App - PF Services such as PF Claim and to check PF balance online
MINISTRY OF LABOUR & EMPLOYMENT

Labour Comissionerate
Directorate of Employment
Directorate of Factories
Directorate of Boilers
Directorate of ESI Medical Benefit
Directorate of Industrial Tribunals,WC courts, Labour Courts
Labour Institute
Boards – Labour welfare, Wages Advisory, Contract Labour, Building and Construction Workers
THE LAST WORD

• Adherence Vs Compliance