TRADE UNION ACT, 1926

The Trade Union Act, 1926 was enacted with the object of a) Providing for the
registration of trade unions b) Verification of the membership of trade unions registered so
that they may acquire a legal and corporate status. The act has provision for Registration" of
trade union but NOT "Recognition" of trade union.

DEFINITIONS

Appropriate Government is "Central Government" for Trade Unions whose objects are not
confined to one State, and for all other Trade Unions,

"State Government" is appropriate government.

Executive means the body, by whatever name called to which the management of the affairs
of a Trade Union is entrusted.

Office-bearer, in the case of a Trade Union, includes any member of the executive thereof,
but does not include an auditor.
Registered Office means head office of a registered Trade Union.

Registrar means a Registrar of Trade Unions appointed by the appropriate Government, and
includes an additional or Deputy Registrar of Trade Union.

Trade Dispute means any dispute between (a) employers and workmen or (b) workmen and
workmen, or (c) employers and employers which is connected with the employment or non-
employment, or the terms of employment or the conditions of labour, of any person.

Workmen means all persons employed in trade/industry whether or not in the employment of
the employer with whom the trade dispute arises.
Trade Union means combination, whether temporary or permanent, formed primarily for the
purpose of regulating the relations between workmen and employers or between workmen
and workmen, or between employers and employers, or for imposing restrictive condition on
the conduct of any trade or business, and includes any federation of two or more Trade
Unions.

APPOINTMENT OF REGISTRARS
The appropriate Government shall appoint a person to be the Registrar (along with as many
Additional and Deputy Registrars) of Trade Unions for each State.

MODE OF REGISTRATION

As per Amendment in 2001- No trade union of workmen shall be registered unless at least
10% or 100. whichever is less, subject to a minimum of 7 workmen engaged or employed in
the establishment with which it is connected are the members of trade union on the date of
making of application for registration.

APPLICATION FOR REGISTRATION

Every application for registration of a Trade Union shall be accompanied by a copy of the
rules of the Trade Union and a statement of the following particulars:

(a) The names, occupations and addresses of place of work of the members
(b) The name of the Trade Union and the address of its head office.

(c) The title, names, ages, addresses and occupations of the office bearers of the Trade Union.
(d) General statement of the assets and liabilities, if Trade Union is more than 1 year old.

Rules of Trade Union includes

(a) Name of the Trade Union,

(b) Objectives of Trade Union,

(c) Purposes for which the general funds of the Trade Union shall be used,
(d) Maintenance of a list of the members,

(e) Admission of ordinary members, honorary or temporary members

(f) any benefit, fine or forfeiture on the members

(g) procedure for amendment of rules

(h) election of members of the executive & office bearers

(i) safe custody of the funds of the Trade Union and an annual audit

(j) rules under which Trade Union may be dissolved.

Amendment in 2001- Minimum rate of subscription for the trade union is fixed at Rs 1 per
annum for rural ‘workers, Rs 3 per annum for workers in other unorganised sectors and Rs 12
per annum in all other cases.
Amendment in 2001- Members of the executive and other office-bearers of the Trade Union
shall be elected for duration of period being not more than 3 years.
REGISTRATION & ISSUANCE OF CERTIFICATE OF REGISTRATION

The Registrar, on being satisfied, shall register the Trade Union by entering in a register.
Once registered, he shall issue a certificate of registration.
CANCELLATION OF REGISTRATION
A certificate of registration of a Trade Union may be cancelled by the Registrar:

(a) On the application of the Trade Union

(b) If the Registrar is satisfied that the certificate has been obtained by fraud or mistake, or
that the Trade Union has ceased to exist. But Registrar will provide 2 months notice in this
case, hefore cancelation.

(c) If the Registrar is satisfied that a registered Trade Union of workmen ceases to have the
requisite number of members. (Added as per Amendment in 2001)

REGISTERED OFFICE
Notice of any change in the registered address of the head office, should be given to the
Registrar in writing. within 14 days such change.

APPEAL
Any person aggrieved by any refusal/withdrawal/cancellation of the Registrar to register a
Trade Union may appeal to a

(a) a Labour Court or an Industrial Tribunal in that area

(b) High Court or

(c) not inferior to the Court of an additional or assistant Judge.

LEGAL STATUS OF A REGISTERED TRADE UNION

* A registered trade union is a body corporate with perpetual succession and a common seal.

« It can acquire, hold sell or transfer any movable or immovable property and can be a party
to contracts.

« It can sue and be sued in its own name

* No civil suit or other legal proceeding can be initiated against a registered trade union in
respect of any act done in furtherance of a trade dispute under certain conditions.

« No agreement between the members of a registered trade union shall be void or voidable
merely on the ground that any of its objects is in restraint of trade.

CERTAIN ACTS NOT TO APPLY TO REGISTERED TRADE UNIONS

The following Acts do not to apply to registered Trade Unions:

(a) The Societies Registration Act, 1860

(b) The Co-operative Societies Act, 1912

(c) The Companies Act, 1956 The registration of any Trade Union under any such Act shall
be void.

OBJECTS ON WHICH GENERAL FUNDS MAY BE SPENT

The general funds of a registered Trade Union shall not be spent on any other than the
following:

« payment of salaries, allowances and expenses to office bearers of the Trade Union
« payment of expenses for the administration of the Trade Union

« prosecution of defense of any legal proceeding

» conduct of trade disputes on behalf of the Trade Union or any member

« compensation of members for loss arising out of trade disputes

« allowance to members/dependents for death, old age. sickness, accidents or unemployment

« liability under policies of assurance on the lives for members or under policies insuring
members against sickness, accident or unemployment;

* educational, social or religious benefits for members (including expenses of funeral or

religious ceremonies for deceased members) or for the dependents of members;
« upkeep of a periodical published The expenditure in respect of such contributions in any
financial year shall not be in excess of 25% of total of the gross income which has up to that
time accrued to the general funds of the Trade Union during that year and of the balance at
the credit at the commencement of that year.

CONSTITUTION OF A SEPARATE FUND FOR POLITICAL PURPOSES

A registered Trade Union may constitute a separate fund, from contributions separately
levied for that fund, for the promotion of the civic and political interest of its members. It
may be used for:

« expenses incurred, by a candidate for election as a member of any legislative body.

« holding of any meeting or the distribution of any literature or documents in support of

candidate.
* maintenance of any person who is a member of any legislative body

« registration of electors or the selection of a candidate for any legislative body

« holding of political meetings

No member shall be compelled to contribute to the political fund and by not contributing,
shall not be excluded from any benefits of the Trade Union, No members of a Trade union
shall be liable to be punished under Section 120-B of Indian Penal Code. No legal proceeding
shall be maintainable in any Civil Court against any registered Trade Union or an) member
thereof in respect of any act done in furtherance of a trade dispute. The account books of a
registered Trade Union shall be open to Inspection by members of Trade Unions. Any person
who has attained the age of 15 years may be a member of registered Trade Union.

DISQUALIFICATION OF OFFICE BEARERS OF TRADE UNION

A person shall be disqualified for being chosen as "office-bearer" of a registered Trade Union
if:
(i) He has not attained the age of 18 years
(ii) He has been convicted by a Court in India of any offence involving moral turpitude and
sentenced to imprisonment, unless a period of 5 years has elapsed since his release.

PROPORTION OF OFFICE-BEARERS TO BE CONCERNED WITH THE

INDUSTRY
At least 50% of the total number of the office-bearers of registered Trade Union in an
unorganised sector shall be persons actually engaged/employed in an industry with which the
Trade Union is connected.
As per Amendment in 2001:

« All office-bearers of a registered Trade Union, except not more than one-third of the total
number of the office-bearers or 5, whichever is less, shall be persons actually engaged or
employed in the establishment or industry with which the Trade Union is connected.
* An employee who has been retired or retrenched shall not be construed as Outsider for the
purpose of holding, an office in a Trade Union.
« No member of the Council of Ministers or a person holding an office of profit (not being an
engagement or employment in an establishment or industry with which the Trade Union is
connected), in the Union or a State, shall be a member of the executive or other office-hearer
of a registered Trade Union.".
CHANGE OF NAME
Any Trade Union may change its name, with the consent of at least two-thirds of total
members.

AMALGAMATION OF TRADE UNION

Any 2 or more Trade Unions may become amalgamated together as one Trade Union
provided that the votes of at least 50% of the members of each or every Trade Union entitled
to vote are recorded, and that at least 60% of the votes recorded are in favour of the proposal
of smalgamation.
NOTICE OF CHANGE OF NAME OR AMALGAMATIONS
In case of change of name of Trade Union and or amalgamations of multiple Unions, the
Secretary and members of the each Union, will give Notice in writing, to the Registrar. The
Registrar of the (State) in which the head office of the amalgamated Trade Union will be
Registrar in case of amalgamation.

DISSOLUTION
When a Trade Union is dissolved, notice for the dissolution signed by 7 members and the
Secretary, shall be sent to the Registrar, within 14 days of the dissolution. If rules of the
Dissolved Trade Union do not provide for the distribution of funds, the Registrar shall divide
the funds amongst the member.

RETU RNS
Trade Union will submit "general statement” of all receipts and expenditure, to the Registrar,
on 31' December of each year. A copy of the rules of the Trade Union will also be submitted.
A copy of every alteration made in the rules of a registered Trade Union shall be sent to the
Registrar within 15 days of making of the alteration. The Registrar may require production of
certificate of registration, account hooks, registers, and other documents at registered office
and at such place as lie may specify, but not at a distance of more than 10 miles from the
registered office of a Trade Union.
POWER TO MAKE REGULATIONS
The appropriate Government may make regulations for:

(a) rules of registration of Trade Unions shall be registered and the fees payable.

(b) transfer of registration in the case change in head office from one State to another;
(c) qualifications of person responsible for audit of the accounts of registered Trade Unions
(d) conditions of inspection of documents kept by Registrars and fees chargeable for
inspections.
PUBLICATION OF REGULATIONS
The date after which draft of regulations proposed to be made will be taken into consideration
shall not be less than 3 months from the date on which proposed regulations were published
for general information
PENALTIES
* Failure to submit returns- Fine of Rs 5, and in the case of a continuing default, additional
fine of Rs 5 per week. But the aggregate fine shall not exceed Rs 50.

» Willful false entry/omission in the general statement/rules- Fine up to Rs 500

* Supplying false information regarding Trade Unions- Fine which may extend to Rs 200.

AMENDMENTS IN ACT IN 2001

Some of the salient features of the Trade Unions (Amendment) Act, 2001 are: 1) No trade
union of workmen shall be registered unless at least 10% or 100, whichever is less, subject to
a minimum of 7 workmen make the application for registration. 2) A registered trade union of
workmen shall at all times continue to have not less than 10% or 100 of the workmen,
whichever is less, subject to a minimum of 7 persons. 3) All office bearers of a registered
trade union, except not more than one-third of the total number of office bearers or 5,
whichever is less, shall be persons actually engaged or employed in the establishment or
industry with which the trade union is connected. 4) Minimum rate of subscription for the
trade union is Rs 1 per annum for rural workers, Rs 3 per annum for workers in other
unorganised sectors and Rs 12 per annum in all other cases. 5) Employees who have
retired/retrenched shall not be construed as outsiders for purpose of holding an office in the
trade union concerned. 6) Members of the executive and other office-bearers of Trade Union
shall be elected for minimum 3 years.

TRADE UNIONS (AMENDMENT) BILL, 2019

On 08 January 2019, The Trade Unions (Amendment) Bill, 2019 was introduced in Lok
Sabha. The Bill proposes to insert new section which will provide for the "Recognition” of
Trade Unions or Federations of Trade Unions at Central and State level.
 INDUSTRIAL DISPUTES ACT, 1947

The Industrial Disputes Act, 1947 came into operation on the first day of April, 1947.
This Act replaced the Trade Disputes Act of 1929. The Trade Disputes Act imposed certain
restraints on the right of strike and lockout in Public Utility Services. But no provision was
existing for the settlement of Industrial Disputes, either by reference to a Board of
Conciliation or to a Court of Inquiry. In order to remove this deficiency, the Industrial
Disputes Act, 1947 was enacted.

DEFINITIONS

Average Pay means the average of the wages payable to a workmen, calculated as:

(i) In the case of monthly paid - Average of 3 complete calendar months.

(ii) In the case of weekly paid - Average 4 complete weeks.

(iii) In the case of daily paid workman - Average of 12 full working days.

Award means an interim or final determination of any industrial dispute by any Labour
Court, Industrial Tribunal or National Tribunal.

Closure means the permanent closing down of a place of employment or part thereof
Conciliation Officer means a conciliation officer appointed under the Act.
Court means a "Court of Inquiry" constituted under this Act.

Labour Court means a "Labour Court" constituted under this Act

Controlled Industry means any industry the control of which, by the Union Government has
been declared to the expedient in the public interest. That is, an industry which is controlled
by the Central Government. But it must also be declared by the Central Act to be controlled
by the Union.

Industry means any systematic activity carried between an employer and his workmen for the
production, supply or distribution of goods or services with a view to satisfy human wants or
wishes. It does NOT include:

« any agricultural operation

« hospitals or dispensaries

« educational, scientific, research or training institutions

« institutions engaged in any charitable, social or philanthropic service

« khadi or village industries

* Government related sovereign functions including defence research, atomic energy and
space
« any domestic service

« any activity by an individual/individuals, if the number of persons employed is less than 10.

Industrial Disputes may be defined as:

(1) a dispute or difference between (a) employers and employers, or (b) employers and
workmen, (c) workmen and workmen;

(2) the dispute or difference should be connected with (a) employment or non-employment,
or (b) terms of employment, or (c) conditions of labour of any person;

(3) the dispute may be in relation to any workman or workmen or any other person in whom
they are interested as a body. Where any employer discharges, dismisses, retrenches, or
terminates the services of an individual workman, any dispute on this shall be deemed to be
an "industrial dispute” notwithstanding that no other workman nor any union of workmen is a
party to the dispute. Any workman may make an application direct to the Labour Court or
Tribunal for adjudication after the expiry of 45 days from the date he has made the
application to the Conciliation Officer for conciliation of the dispute. But the application can
be made to the Labour Court or Tribunal before expiry of 3 years from the date of discharge,
dismissal, retrenchment or otherwise termination of service.

Lay Off means the failure, refusal or inability of an employer to give employment to a
workman whose name is borne on the muster-rolls,

« on account of shortage of coal. power or raw materials or the accumulation of stocks

» break-down of machinery

« natural calamity

« for any other connected reason. If workman presents himself for work at the establishment
and is not given employment within 2 hours, he shall be deemed to have been laid off for that
day.

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.
Public Utility Service means —

(i) any railway service or any transport service for the carriage of passengers or goods by air;
or any service in major port or dock;

(i) any section of an industrial establishment, on the working of which the safety of the
establishment or the workmen employed depends;

(iii) any postal, telegraph or telephone service;

(iv) any industry which supplies power, light or water to the public;

(v) any system of public conservancy or sanitation;

(vi) any industry specified in the First Schedule which the appropriate Government may, if
satisfied that public emergency or public interest so requires, by notification in the Official
Gazette, declare to be a public utility service for the purposes of this Act, for such period as
may be specified in the notification
Retrenchment means termination of the service of a workman for any reason whatsoever,
otherwise than as a punishment inflicted by way of disciplinary action, but does NOT
include:

(a) voluntary retirement of the workman: or

(b) retirement of the workman on reaching the age of superannuating

(b) termination of the service of the workman as a result of the non-renewal of the contract of
employment

(c) termination of the service of a workman on the ground of continued ill-health.

Settlement means a settlement arrived at in the course of conciliation proceeding.
Strike means a cessation of work by a body of persons employed in any industry acting in
combination, or a concerted refusal, or a refusal under a common understanding, of any
number of persons who are or have been so employed to continue to work or to accept
employment;
Trade union means a trade union registered under the Trade Unions Act, 1926. Tribunal
means an Industrial Tribunal constituted under this Act. Unfair labour practice means any of
the practices specified in the Fifth Schedule under this Act.

Wages means all remuneration capable of being expressed in terms of money, be payable to a
workman in respect of his employment. It includes —

(i) Allowances (including dearness allowance);

(ii) Value of any house accommodation, or of supply of light, water, medical attendance or
other amenity like food.

(iii) Traveling concession;

(iv) Any commission payable on the promotion of sales or business or both.

But it DOES NOT include
(i) any bonus;
(ii) any contribution towards pension fund or provident fund.

(iii) any gratuity payable.

Workman means any person (including an apprentice) employed in any industry to do any
manual. unskilled, skilled, technical, operational, clerical or supervisory work.
But it DOES NOT includes

(i) who is subject to the Air Force Act, 1950, or the Army Act, 1950, or the Navy Act, 1957
or
(ii) who is employed in the police service or as an officer or other employee of a prison; or

(iii) who is employed mainly in a managerial or administrative capacity; or

(iv) who, being employed in a supervisory capacity, draws wages exceeding Rs 10,000 per
mensem or exercises. As per Amendment in 2010, Supervisors drawing wages not exceeding
Rs. 10,000 per month are coming within the definition of workmen. Earlier this limit was Rs
1600 per month.
MACHINERY FOR CONCILIATION AND ADJUDICATION

Works Committee

« In case, 100 or more workmen are employed in the preceding 12 months, the appropriate
Government may require the employer to constitute a "Works Committee".

« Number of representatives of workmen shall not be less than number of representatives of

employer.

« It shall be the duty of the Works Committee to promote measures for securing and
preserving amity and good relations between the employer and workmen.

Conciliation officers

« The appropriate Government may appoint one or more Conciliation Officers, charged with
the duty of mediating in and promoting the settlement of industrial disputes. (for
Conciliation).
« A conciliation officer may be appointed for a specified area, specified industries in a
specified area or for one or more specified industries and either permanently or for a limited
period.
Boards of Conciliation

« The appropriate Government may constitute a Board of Conciliation for promoting the
settlement of an industrial dispute, which shall consist of a Chairman and 2 or 4 other
members.
* The chairman shall be an independent person and the other members shall be persons
appointed in equal numbers to represent the parties to the dispute.

Courts of Inquiry

* The appropriate Government may constitute a Court of Inquiry for inquiring into any matter
of industrial dispute (for Conciliation).

* A court may consist of one independent person or of such number of independent persons
as the appropriate Government may think fit and where a court consists of two or more
members, one of them shall be appointed as the chairman.
Labour Courts

« The appropriate Government may constitute one or more Labour Courts for the adjudication
of industrial disputes relating to any matter specified in the Second Schedule

* A Labour Court shall consist of one person only to be appointed by the appropriate
Government.

* A person shall not be qualified for appointment as the presiding officer of a Labour Court,
unless
he is, or has been, a Judge of a High Court; or

he has, for a period of not less than 3 years, been a District Judge or an Additional District
Judge; or

he has held any judicial office in India for not less than 7 years; or

he has been the presiding officer of a Labour Court constituted under any Provincial Act or
State Act for not less than 5 years.
he is or has been a Deputy Chief Labour Commissioner (Central) or Joint Commissioner of
the State Labour Department, having a degree in law and at least 7 years' experience in the
labour department including 3 years of experience as Conciliation Officer.

he is an officer of Indian Legal Service in Grade III with 3 years' experience in the grade

Industrial Tribunals

* The appropriate Government may, constitute one or more Industrial Tribunals for the
adjudication of industrial disputes, whether specified in the Second Schedule or the Third
Schedule.
+ A Tribunal shall consist of one person only to be appointed by the appropriate Government.

* A person shall not be qualified for appointment as the presiding officer of a Tribunal unless

he is, or has been, a Judge of a High Court; or

he has, been a District Judge or an Additional District Judge, for not less than 3 years,
he is or has been a Deputy Chief Labour Commissioner (Central) or Joint Commissioner of
the State Labour Department, having a degree in law and at least 7 years' experience in the
labour department including 3 years of experience as Conciliation Officer.

he is an officer of Indian Legal Service in Grade III with 3 years' experience in the grade

* The appropriate Government may appoint 2 persons to advise the Tribunal in the
proceedings.

National Tribunals

* The Central Government may. constitute one or more National Industrial Tribunals for the
adjudication of industrial disputes:
If it involves questions of national importance
If it involves matters of such a nature that industrial establishments situated in more than one
State are likely to be interested in. or affected by, such disputes.

« A National Tribunal shall consist of one person only to be appointed by the Central
Government.
« A person shall not be qualified for appointment as the presiding officer of a National
Tribunal unless he is, or has been, a judge of a High Court.

* The Central Government may, if it so thinks fit, appoint two persons as assessors to advise
the National Tribunal in the proceeding before it.

No person shall be appointed to, or continue in, the office of the presiding officer of a Labour
Court, Tribunal or National Tribunal, if

(a) he is not an independent person; or

(b) he has attained the age of 65 years.

NOTICE OF CHANGE
No, employer, who proposes to effect any change in the conditions of service applicable to
any workman in respect of any matter specified in the Fourth Schedule, shall effect such
change,

(a) without giving to the workmen a notice of the nature of the change proposed to be
effected; or

(b) within 21 days of giving such notice:

SETTING UP OF GRIEVANCE REDRESSAL MACHINERY (This section has been
added through amendment in year 2010)
» Every industrial establishment employing 20 or more workmen shall have one or more
Grievance Redressal Committee.
« The Committee shall consist of equal number of members from the employer and the
workmen.
» The chairperson of the Committee shall be selected from the employer and workmen
alternatively on rotation basis every year.

* The total number of members of the Grievance Redressal Committee shall not exceed more
than 6.

* There shall be one woman member if the Grievance Redressal Committee has two
members. In case the number of members are more than two, the number of women members
may be increased proportionately.
* The Grievance Redressal Committee may complete its proceedings within 30 days on
receipt of a written application.
* The workman can appeal to Employer against the decision of Grievance Redressal
Committee, which will dispose off the appeal within 1 month.

REFERENCE OF DISPUTES TO BOARDS, COURTS OR TRIBUNALS

The appropriate Government may:

(a) refer the dispute to a Board

(b) refer to the dispute to a Court for inquiry; or

(c) refer, if it relates to any matter in Second Schedule, to a Labour court for adjudication; or
(d) refer, if it relates to any matter in Second or Third Schedule, to an Industrial Tribunal for
adjudication :
(e) If the dispute relates to the Third Schedule and but is not likely to affect more than 100
workmen. it may be referred to a Labour Court. .

(f) Where the dispute involves any question of National Importance or More than one States,
Govt may refer it to a National Tribunal for adjudication (even if it relates to any matter
specified in the Second Schedule or the Third Schedule)- Only Centre Government can refer
a dispute to National Tribunal. An order referring an industrial dispute to a Labour Court,
Tribunal or National Tribunal under this section shall specify the period within which such
Labour Court, Tribunal or National Tribunal shall submit its award on such dispute to the
appropriate Government. If industrial dispute is connected with an individual workman, such
period shall not exceed 3 months.

Where an industrial dispute has been referred to a Board, Labour Court, Tribunal or National
Tribunal, the appropriate Government may prohibit the continuance of any strike or lock-out
in connection with such dispute.

Where any reference has been made to a National Tribunal, then no Labour Court or Tribunal
shall have jurisdiction to adjudicate upon any matter in that dispute.
Proceedings before a Labour Court, Tribunal or National Tribunal shall NOT lapse merely by
reason of the death of any of the parties and shall complete such proceedings and submit its
award to the appropriate Government.

VOLUNTARY REFERENCE OF DISPUTES TO ARBITRATION

The employer and the workmen may agree to refer the dispute to arbitration, they may do so
at any time before the dispute has been referred to a Labour Court or Tribunal or National
Tribunal
Where an arbitration agreement provides for a reference of the dispute to an even number of
arbitrators, the agreement shall provide for the appointment of another person as umpire.

A copy of the arbitration agreement shall be forwarded to the appropriate Government and
the conciliation officer and the appropriate Government shall, publish the same in the Official
Gazette , within I month from the date of the receipt of such copy. Where an industrial
dispute has been referred to arbitration, the appropriate Government may, prohibit the
continuance of any strike or lock-out in connection with such dispute.
POWERS OF CONCILIATION OFFICERS, BOARDS, COURTS AND TRIBUNALS
Every Board, Court, Labour Court, Tribunal and National Tribunal shall have the same
powers as are vested in a Civil Court in respect of the following matters:

(a) enforcing the attendance of any person and examining him on oath;

(b) compelling the production of documents and material objects;

(c) issuing commissions for the examination of witnesses; Every inquiry or investigation by a
Board, Court, Labour Court, Tribunal or National Tribunal shall be deemed to be a judicial
proceeding.
A conciliation officer may enforce the attendance of any person for the purpose of
examination of such person or call for and inspect any document which he has ground for
considering to be relevant to the industrial dispute.

A Court, Labour Court, Tribunal or National Tribunal may, if it so thinks fit, appoint one or
more persons having special knowledge of the matter under consideration as an assessor or
assessors to advise it.
Every Labour Court, Tribunal or National Tribunal shall be deemed to be Civil Court. All
Conciliation Officers, Members of a Board or Court and the Presiding Officers of a Labour
Court, Tribunal or National Tribunal shall be deemed to be public servants.

DUTIES OF CONCILIATION OFFICERS

If a settlement of the dispute is arrived, the conciliation officer shall send a report to the
appropriate Government together with a memorandum of the settlement signed by the parties
to the dispute.

If settlement is NOT arrived at, still, the conciliation officer shall, send report to the
appropriate Government with a full report on the steps taken by him, circumstances, and the
reasons.
If, after reviewing the submitted report, the appropriate Government is satisfied that there is a
case for reference to a Board, Labour Court, Tribunal or National Tribunal, it may make such
reference. Where the appropriate Government does not make such a reference it shall record
and communicate to the parties concerned its reasons.
A report shall be submitted within 14 days of the commencement of the conciliation
proceedings.

DUTIES OF BOARD
Where a dispute has been referred to a Board, the Board will bring about a settlement of the
same. If a settlement is arrived, at in the course of the conciliation proceedings, the Board
shall send a report thereof to the appropriate Government. However, if no such settlement is
arrived at, the Board shall, send to the appropriate Government a full report setting for the
proceedings and steps taken by the Board.

After receiving the report, the appropriate Government may or may not make a reference to a
Labour Court, Tribunal or National Tribunal and communicate to the parties concerned its
reasons therefor.

The Board shall submit its report within 60 days, from the date on which the dispute was
referred to it.

DUTIES OF COURTS
A Court shall inquire and submit report to the appropriate Government within 6 months

PUBLICATION OF REPORTS AND AWARDS

« Every report of a Board or Court, every arbitration award and every award of a Labour
Court, Tribunal or National Tribunal shall be published, within a period of 30 days from the
date of its receipt by the appropriate Government.
* An award shall become enforceable on the expiry of 30 days from the date of its
publication. However, the Central Government may declare that the award shall not become
enforceable on the expiry of the said 30 days, if there are public grounds affecting national
economy or social justice.

* The appropriate Government may make an order of rejecting or modifying the award within
90 days from the date of publication of the award BUT shall lay the award together with a
copy of the order before the Legislature (for States) , or before Parliament(if order made by
Central Govt)

» Where any award as rejected or modified, is laid before the Legislature of a State or before
Parliament, such award shall become enforceable on the expiry of 15 days from the date on
which it is so laid
« If a Labour Court, Tribunal or National Tribunal by its award directs reinstatement of any
workman but the employer moves to a High Court/Supreme Court, against such award, the
employer shall be liable to pay full wages to workman, during pendency of proceedings in the
Higher Courts.

PERSONS ON WHOM SETTLEMENTS AND AWARDS ARE BINDING

* A settlement arrived at by agreement between the employer and workman, otherwise than in
the course of conciliation proceeding, shall be binding on the parties to the agreement.
* A settlement arrived at in the course of (a) conciliation proceedings, or (b) an arbitration
award, or (c) an award of a Labour Court, Tribunal or National Tribunal, shall be binding on
all parties.

PERIOD OF OPERATION OF SETTLEMENTS AND AWARDS

A settlement shall come into operation on as agreed upon by the parties, and if no date is
agreed upon, w.e.f. the date on which the memorandum of the settlement is signed by the
parties.

Such settlement shall be binding for period as is agreed by the parties, and if no such period
is agreed upon, it will be binding for a period of 6 months from the date on which the
memorandum of settlement is signed by the parties. It shall continue to be binding on the
parties after the expiry of the period aforesaid, until the expiry of 2 months from the date on
which a notice in writing of an intention to terminate the settlement is given by one of the
parties.

An award shall, remain in operation for a period of 1 Year from the date on which the award
becomes enforceable. The appropriate Government may, before the expiry of I year, may
extend the period of operation by any period not exceeding 1 year at a time. However, the
total period of operation of any award does not exceed 3 years from the date on which it came
into operation.
The award shall continue to be binding on the parties until a period of 2 months has elapsed
from the date on which notice is given by any party bound by the award to the other party or
parties intimating its intention to terminate the award If the appropriate Government thinks,
there has been a material change in the circumstances, the appropriate Government may refer
the award to a Labour Court, if the award was that of a Labour Court or to a Tribunal, if the
award was that of a Tribunal or of a National Tribunal.

COMMENCEMENT AND CONCLUSION OF PROCEEDINGS

A conciliation proceeding shall be deemed to have commenced on the date on which a notice
of strike or lock-out is received by the conciliation officer or on the date of the order referring
the dispute to a Board. A conciliation proceeding shall be deemed to have concluded:

(a) where memorandum of the settlement is signed by the parties to the dispute;
(b) where no settlement is arrived at, when the report of the conciliation officer is received by
the appropriate Government
(c) when a reference is made to a Court, Labour Court, Tribunal or National Tribunal during
the pendency of conciliation proceedings.

Proceedings before a Labour Court, Tribunal or National Tribunal shall be deemed to have
commenced on the date of reference of the dispute for arbitration or adjudication

Proceedings before a Labour Court, Tribunal or National Tribunal shall be deemed to have
concluded on the date on which the award becomes enforceable.

STRIKES AND LOCK-OUTS

(1) No person employed in a public utility service shall go on strike:

(a) without giving to the employer notice of strike, within 6 weeks before striking; or
(b) within 14 days of giving such notice ; or

(c) before the expiry of the date of strike specified in any such notice as aforesaid; or

(d) during pendency of conciliation proceedings and 7 days after conclusion of such
proceedings.
(2) No employer carrying on any public utility service shall lock-out any of his workman:

(a) without giving them notice of lock-out. within 6 weeks before locking-out; or

(b) within 14 days of giving such notice; or

(c) before the expiry of the date of lock-out specified in any such notice as aforesaid; or

(d) during pendency of conciliation proceedings and 7 days after conclusion of such
proceedings.
(3) If an employer receives any such notice of Strike or gives any notice of lockout, he shall
report to the appropriate Government, within 5 days.

(4) No workman shall go on strike and no employer shall declare a lock-out in following
cases:
(a) during the pendency of conciliation proceedings before a Board and 7 days after the
conclusion of such proceedings;

(b) during the pendency of proceedings before a Labour Court, Tribunal or National Tribunal
and 2 months, after the conclusion of such proceedings;

(c) during the pendency of arbitration proceedings before an arbitrator and 2 months after the
conclusion of such proceedings.

(d) during any period in which a settlement or award is in operation, in respect to that matter.

In cases (1) to (4), Strike or Lockout become Illegal. No person shall knowingly expend or
apply any money in support of any illegal strike or lock-out

However, a lock-out declared in consequence of an illegal strike or a strike declared in

consequence of an illegal lock-out shall NOT be illegal.

LAY-OFF AND RETRENCHMENT

The provisions of Layoff and Retrenchment applies only to: * Industrial establishments
having 50 or more workmen on an average per working day. * Industrial establishments
which are NOT of a seasonal character.
A workman shall be said to be in continuous service for 1 year, if he has worked for 190 days
in a mine or 240 days in all other cases, during last year.

A workman shall be said to be in continuous service for 6 months, if he has worked for 95
days in a mine or 120 days in all other cases, during 6 months.

Following are considered part of continuous service:

(a) sickness
(b) authorised paid leave

(c) an accident
(d) strike, which is not illegal

(e) lock-out
(f) a cessation of work which is not due to any fault on the part of the workman

(g) absent due to temporary disablement caused by accident

(h) maternity leave (up to 26 weeks).

RIGHT OF WORKMEN LAID-OFF FOR COMPENSATION

Whenever a workman (other than a badli workman or a casual workman), who has not less
than 1 Year of continuous service is laid-off, he shall be paid for all days during laid
off(except weekly holidays). The compensation shall be equal to 50% of the total of the basic
wages and dearness allowance.

If a workman is laid-off for more than 45 days during 12 months, no such compensation shall
be paid after the expiry of first 45 days, if there is an agreement between the workman and
the employer. (The employer may retrench workman after 45 days).

Badli workman means a workman who is employed in the place of another workman whose
name is borne on the muster rolls of the establishment, if he has completed 1 year of
continuous service.
WORKMEN NOT ENTITLED TO COMPENSATION IN CERTAIN CASES No
compensation shall be paid to a workman who has been laid-off:

(1) if he refuses to accept any alternative employment in the same establishment, or in any
other establishment within a radius of 5 miles.

(i) if he does not present himself for work at the establishment at the appointed time during
normal working hours at least once a day.
(iii) if such laying-off is due to a strike or slowing-down of production on the part of
workmen in another part of the establishment.

CONDITIONS PRECEDENT TO RETRENCHMENT OF WORKMEN

No workman, who has been in continuous service for not less than 1 year, shall be retrenched
until:

(i) the workman has been given 1 month's notice in writing indicating the reasons for
retrenchment, or the workman has been paid wages for the period of the notice;

(i) the workman has been paid, at the time of retrenchment, compensation which shall be
equivalent to 15 days' average pay for every completed year of continuous service or any part
in excess of 6 months; and

(iii) notice in the prescribed manner is served on the appropriate Government

COMPENSATION TO WORKMEN IN CASE OF TRANSFER OF UNDERTAKINGS
Where the ownership of management of an undertaking is transferred, every retrenched
workman who has been in continuous service for not less than 1 year, shall be entitled to
notice and compensation.

NOTICE TO BE GIVEN FOR CLOSE DOWN ANY UNDERTAKING

An employer wanting to close down an undertaking shall serve, at least 60 days notice, on the
appropriate Government stating clearly the reasons. This Notice Rule is not applicable if:

(i) less than 50 workmen are employed, or

(ii) less than 50 workmen were employed on an average working day in the preceding 12
months,

(iii) for an undertaking set up for the construction of buildings, bridges, roads, canals, dams.

COMPENSATION TO WORKMEN IN CASE OF CLOSING DOWN OF

UNDERTAKINGS

Where an under taking is closed down, every workman who has been in continuous service
for not less than 1 year, be entitled to notice and compensation, as if the workman had been
retrenched.

However if the undertaking is closed down on account of "unavoidable circumstances”

beyond the control of the employer, the compensation to be paid shall not exceed his average
pay for 3 months. The following will not be considered unavoidable circumstances:

(i) financial difficulties (including financial losses);

(i) accumulation of undisposed of stocks;

(iii) expiry of the period of the lease or licence granted to it;

(iv) exhaustion of the minerals in the area, if engaged in mining operations.

For any undertaking for the construction of buildings. bridges, roads, canals, dams or other
construction work:

« If closed down on account of the completion of the work within 2 years, no workman shall
be entitled to any compensation

« BUT if the construction work is not so completed within 2 years, workman shall be entitled
to notice and compensation
PROCEDURE FOR RETRENCHMENT

The employer shall ordinarily retrench the workman who was the last person to be employed
in that category. Further re-trenched employees will have preference over other persons if re-
employment opportunities are there.

SPECIAL PROVISIONS ESTABLISHMENRS WITH MORE THAN 100 WORKMEN

(Popularly known as Chapter 5B) There are special provisions of Lay Off and Retrenchment
for establishments with 100 or more workmen, employed on an average per working day for
the preceding 12 months.

Prohibition of lay-off for more than 100 workmen establishments:

« No workman (except badli/casual) shall be laid-off by his employer except with the "prior
permission of the appropriate Government”, unless such lay-off is due to shortage of power
or to natural calamity.

« In the case of a mine (lay-off is due to fire, flood, excess of inflammable gas or explosion),
Employer may lay off but he has to seek permission from appropriate Government within 30
days from commencement of such lay-off If the appropriate Government does not respond
within 60 days, the permission shall be deemed to have been granted. The Order of
appropriate Government will be final and binding and remain in force for 1 year.

* The appropriate Government may also refer to a Tribunal for adjudication, in which case,
Tribunal shall decide within 30 days.

Conditions precedent to retrenchment for more than 100 workmen establishments

« No workman, in continuous service for not less than | year, shall be "retrenched" until: o
the workman has been given 3 months' notice in writing or wages for the notice period. o the
prior permission of the appropriate Government is obtained.

« If the appropriate Government does not respond within 60 days, the permission shall be
deemed to have been granted.

* Order of appropriate Government will be final and binding and remain in force for 1 year.

* The appropriate Government may also refer to a Tribunal for adjudication, in which case,
Tribunal shall decide within 30 days.

* Where permission for Retrenchment has been granted, every workman shall be entitled to
compensation equivalent to 15 days' average pay for every completed year of continuous
service or any part thereof in excess of 6 months.

Procedure for closing down an undertaking for more than 100 workmen establishments

* An employer shall apply to the appropriate Government for prior permission at least 90
days before. This is not applicable on an undertaking set up for the construction of buildings,
bridges, roads, canals, dams or for other construction work.
* The order of appropriate Government is binding & shall remain in force for 1 year. If
appropriate Government does not respond in 60 days, the permission shall be deemed to have
been granted.

* The appropriate Government may also refer to a Tribunal for adjudication, which will
decide within 30 days.
* Where permission for Closing Down has been granted, every workman shall be entitled to
compensation equivalent to 15 days' average pay for every completed year of continuous
service or any part thereof in excess of 6 months.

Penalty for lay-off and retrenchment without permission for more than 100 workmen
establishments

« For Lay-off and Retrenchment without permission, the employer shall be punishable with
imprisonment for 1 month, or with fine of Rs 1000 or hoth.

* For Closure without permission, the employer shall be punishable with imprisonment for 6
months, or with fine of Rs 5000 or both.

PENALTIES

+ Committing unfair labour practices- Imprisonment up to 6 months or fine up to Rs 1000 or

both
« Any workman who commits illegal strike - Imprisonment up to 1 months or fine up to Rs
50 or both

« Any employer who commits illegal lock-out - Imprisonment up to 1 months or fine up to Rs

1000 or both

« Anyone who instigates or incites others to take part or gives financial aid in illegal strikes or
lock out - Imprisonment up to 6 months or fine up to Rs 1000 or both
Penalty for anyone who commits a breach of any term of any settlement or award -
Imprisonment up to 6 months or fine or both

« Penalty for wilfull discloses confidential information - Imprisonment up to 6 months or fine

up to Rs 1000 or both

Penalty for changing conditions of service (to the prejudice of the workmen) during
pendency of proceedings- Imprisonment up to 6 months or fine up to Rs 1000 or both
OTHER MISCELLANEOUS
* During the pendency of any proceeding before a conciliation officer or a Board or a Labour
Court or Tribunal or National Tribunal, no employer shall alter, to the prejudice of the
workrnen,.the conditions of service applicable to workers.

* During the pendency of any proceeding in respect of an industrial dispute, the employer can
not take any action against any protected workman. A "protected workman", means a
workman who, being a member of the executive or other office-bearer of a registered trade
union, is recognised as such in accordance with rules made.

« In every establishment, the number of workmen to be recognised as protected workmen

shall be 1% of the total number of workmen, subject to a minimum number of 5 protected
workmen and a maximum of 100 protected workmen.
+ If an employer makes an application, in this regard, to a conciliation officer, Board, an
arbitrator, a Labour Court, Tribunal or National Tribunal for approval of the action (related to
change in service conditions) taken by him, the authority concerned shall, pass order within 3
months.

POWER TO TRANSFER CERTAIN PROCEEDINGS

The appropriate Government may withdraw any proceeding pending before a Labour Court,
Tribunal or National Tribunal and transfer the same to another Labour Court, Tribunal or
National Tribunal. Upon transfer the case may be proceeded either de novo or from the stage
at which it was so transferred. If the case is referring to "changing conditions of service (to
the prejudice of the workmen) during pendency of proceedings”, the proceeding may also be
transferred to a Labour Court.
RECOVERY OF MONEY DUE FROM AN EMPLOYER
Where any money is due to a workman from an employer under a settlement/award, he may
make an application to the appropriate Government within 1 year from the date on which the
money became due. The appropriate Government shall issue a recovery certificate for that
amount to the Collector. If any question arises as to the amount of money due, it may be
decided by such Labour Court, within 3 months. The Labour Court may also appoint a
commissioner to determine the amount. The decision of the Labour Court shall be forwarded
by it to the appropriate Government.

REPRESENTATION OF PARTIES
A workman may be represented by:

(a) any member of the executive or office bearer of a registered trade union

(b) any member of the executive or other office bearer of a federation of trade unions.

(c) if worker is not a member of any trade union, then by any other workman employed in the
same industry.
An employer may be represented by:

(a) an officer of an association of employers

(b) an officer of a federation of association of employers

(c) where the employer is not a member of any association of employers, then by any other
employer engaged in same industry

No party shall be entitled to be represented by a legal practitioner. The legal practitioner may
be permitted but only after the consent of the other party and with the leave of the Labour
Court, Tribunal or National Tribunal, as the case may be.

POWER TO MAKE RULES

The appropriate Government may make rules for:

(a) powers and procedure of conciliation officers, Boards, Labour Courts, Tribunals and
National Tribunals. (aa) form of arbitration agreement, the manner in which it may be signed
by the parties

(b) constitution and functions of and the filling of vacancies in Works Committees.

(c) salaries and allowances and the terms and conditions for appointment of the presiding
officers of the Labour Court, Tribunal and the National Tribunal including the allowances
admissible to members of Courts, Boards and to assessors and witnesses.

(d) ministerial establishment which may be allotted to a Court, Board, Labour Court, Tribunal
or National Tribunal and the salaries and allowances payable to members of such
establishments.
(e) manner in which and the persons by and to whom notice of strike or lock-out may be
given and the manner in which such notices shall be communicated.

(f) conditions subject to which parties may be represented by legal practitioners.

Any contravention of Rules under this section- Punishable with fine not Rs 50.

POWER TO AMEND SCHEDULES

The appropriate Government may amend First Schedule, Second Schedule or Third Schedule.

LIST OF SCHEDULES

Schedule I : Industries which may be declared to be Public Utility Services

* Transport (other than railways) for passengers or goods, (by land or water)

« Banking, Cement, Coal, Cotton textiles, Food stuffs, Iron and Steel, Defence establishments
* Hospitals and dispensaries, Fire Brigade Service, India Government Mints, India Security
Press
« Copper Mining. Lead Mining, Zinc Mining, Iron Ore Mining, Pyrites Mining, Phosphorite
Mining

« Service in any oil-field, Uranium Industry.

* Pyrites Mining, Security Paper Mill, Hoshangabad

« Services in the Bank Note Press, Dewas.

Schedule II : Matters within the Jurisdiction of Labour Courts

* The propriety or legality of an order passed by an employer under the standing orders;

« The application and interpretation of standing orders:

* Discharge or dismissal of workmen including reinstatement of, or grant of relief to,

workmen wrongfully dismissed;

« Withdrawal of any customary concession or privilege;

« lllegality or otherwise of a strike or lock-out; and

« All matters other than those specified in the Third Schedule

Schedule III : Matters within the Jurisdiction of Industrial Tribunals

» Wages, including the period and mode of payment;

» Compensatory and other allowances:

* Hours of work and rest intervals;

« Leave with wages and holidays:

* Bonus, profit sharing, provident fund and gratuity;

» Shift working otherwise than in accordance with standing orders;

» Classification by grades: Rules of discipline;

+ Rationalisation;

* Retrenchment of workmen and closure of establishment; and

« Any other matter that may be prescribed

Schedule IV : Conditions of Service for change of which Notice is to be given

» Wages, including the period and mode of payment;

» Contribution paid/payable, by the employer to any provident fund or pension fund

« Compensatory and other allowances:

« Hours of work and rest intervals;

* Leave with wages and holidays:

« Starting, alteration or discontinuance of shift working

* Classification by grades:

« Withdrawal of any customary concession or privilege

« Introduction of new rules of discipline, or alteration of existing rules

« Rationalisation, standardisation or improvement of plant or technique

* Any increases or reduction (other than casual) in the number of persons employed

Schedule V : Unfair Labour Practices Unfair Labour Practices On the part of employers and
trade unions of employers
« To interfere with, restrain from, or coerce, workmen in the exercise of their right to
organise, form, join or assist a trade union or to engage in collective bargaining or other
mutual aid or protection

* To dominate, interfere with or contribute support, financial or otherwise, to any trade union,
like

(a) an employer taking an active interest in organising a trade union of his workmen; and
(b) an employer showing partiality or granting favour to one of several trade unions.
* To establish employer sponsored trade unions of workmen.

* To encourage or discourage membership in any trade union by discriminating against any

workman.
« To discharge or dismiss workmen unfairly or by way of victimisation;

* To abolish the work of a regular nature being done by workmen, and to give such work to
contractors as a measure of breaking a strike.

* To transfer a workman mala fide from one place to another,

« To insist upon individual workmen, who are on a legal strike to sign a good conduct bond,
as a pre-condition to allowing them to resume work.

* To show favouritism or partiality to one set of workers regardless of merit.

* 'To employ workmen as "badlis", casuals or temporaries and to continue them as such for
years. * To discharge or discriminate against any workman for filing charges or testifying
against an employer in any enquiry or proceeding relating to any industrial dispute.
* To recruit workmen during a strike which is not an illegal strike.

* Failure to implement award, settlement or agreement.

* To indulge in acts of force or violence.

* To refuse to bargain collectively, in good faith with the recognised trade unions.

* Proposing or continuing a lock-out deemed to be illegal under this Act.

Unfair Labour Practices on the part of workmen and trade unions of workmen

* To advise or actively support or instigate any strike deemed to be illegal under this Act.

* To coerce workmen in the exercise of their right to self-organisation or to join a trade union
or refrain from joining any trade union.

» For a recognised union to refuse to bargain collectively in good faith with the employer.

* To indulge in coercive activities against certification of a bargaining representative.

* To stage, encourage or instigate such forms of corrective actions as wilful "go slow",
squatting on the work premises after working hours or "gherao" of members of the
managerial or other staff

* To stage demonstrations at the residence of the employers or the managerial staff members.

* To incite or indulge in wilful damage to employer's property connected with the industry.

* To indulge in acts of force or violence or to hold out threats of intimidation against any
workman with a view to prevent him from attending work.
AMENDMENTS IN THE ACT IN 2010
Supervisors drawing wages not exceeding Rs. 10000 per month are coming within the
definition of workmen. Earlier this limit was Rs 1600 per month.

A new sub-section has been added: Any workman may make an application direct to the
Labour Court or Tribunal for adjudication after the expiry of 45 days from the date he has
made the application to the Conciliation Officer for conciliation of the dispute. But the
application can be made to the Labour Court or Tribunal before expiry of 3 years from the
« date of discharge, dismissal, retrenchment or otherwise termination of service. There is new
provision of composition of the "Grievance Redressal Committee":

« Every industrial establishment employing 20 or more workmen shall have one or more
Grievance Redressal Committee.
* The Committee shall consist of equal number of members from the employer and the
workmen.
* The chairperson of the Committee shall be selected from the employer and workmen
alternatively on rotation basis every year.

* The total number of members of the Grievance Redressal Committee shall not exceed more
than 6.

* There shall be one woman member if the Grievance Redressal Committee has two
members. In case the number of members are more than two, the number of women members
may be increased proportionately.

* The Grievance Redressal Committee may complete its proceedings within 30 days on
receipt of a written application.

* The workman can appeal to Employer against the decision of Grievance Redressal
Committee, which will dispose off appeal within 1 month.
 FACTORIES ACT, 1948
The Factories Act, 1948 is a social legislation which has been enacted for occupational
safety, health and welfare of workers at work places.
DEFINITIONS
Adult means a person who has completed his 18 year of age. Adolescent means a person,
who has completed his 15 year of age but has not completed his 18 year
Calendar year means the period of 12 months beginning with the first day of January in any
year
Child means a person who has not completed his 15 year of age
Competent person means a person or an institution recognised as such by the Chief Inspector
for the purposes of carrying out tests, examinations and inspections required to be done in a
factory.
Hazardous process means any process or activity specified to the "First" Schedule.
Young person means a person, who is either a child or an adolescent;

Day means a period of 24 hours beginning at midnight;

Week means a period of 7 days beginning at midnight on Saturday night;
Power means electrical energy, or any other form of energy, which is mechanically
transmitted and is not generated, by human or animal agency Prime-mover means any engine,
motor or other appliance, which generates or otherwise provides power;
Transmission machinery means any shift, wheel, drum, pulley, system of pulleys, coupling,
clutch, driving belt or other appliance or device by which the motion of a prime-mover is
transmitted to or received. Machinery includes prime-movers, transmission machinery and all
other appliances, whereby power is generated, transformed, transmitted or applied;
Worker means a person employed directly or by or through any agency (including a
contractor) with or without the knowledge of the principal employer whether for
remuneration but does not include any member of the armed forces of the Union.
Factory means any premises including the precincts thereof-(i) where 10 or more workers are
working, or were working on any day of the preceding 12 months, and manufacturing process
is being carried on "with" the aid of power. (i) where 20 or more workers are working, or
were working on any day of the preceding 12 months, and manufacturing process is being
carried on "without" the aid of power. But DOES NOT include a mine, or mobile unit
belonging to the armed forces, railway running shed or a hotel, restaurant or eating place.
Occupier of a factory means the person, who has ultimate control over the affairs of the
factory.
POWER TO EXEMPT DURING PUBLIC EMERGENCY
In any case of public emergency the State Government may, exempt any factory or class or
description of factories from all or any of the provisions of this Act BUT no such notification
shall be made for a period exceeding 3 months at a time.
Public Emergency means a grave emergency whereby the security of India or of any part of
the territory thereof is threatened, whether by war or external aggression or internal
disturbance.
APPROVAL, LICENSING AND REGISTRATION OF FACTORIES
If an application for Approval, licensing and registration of factory is sent to the State
Government or Chief Inspector by registered post, and no order is communicated to the
applicant within 3 months, the permission shall be deemed to have been granted. If State
Government or a Chief Inspector refuses to grant permission, the applicant may within 30
days of the date of such refusal, appeal to the Central Government if the decision was of the
State Government and to the State Government in any other case.

NOTICE BY OCCUPIER
Every occupier shall ensure the health, safety and welfare of all workers while they are at
work in the factory. The occupier shall send to the Chief Inspector a written notice containing
following, at least 15 days before he begins to occupy or use any premises as a factory:

* name and situation of the factory

« name and address of the occupier

« name and address of the owner of the premises or building

« address to which communication relating to the factory may be sent;

* nature of the manufacturing process in last 12 and next 12 months

« total rated horse power installed

+ name of the manager of the factory

+ number of workers likely to be employed in the factory:

« average number of workers per day employed during the last 12 months However, if any
establishment comes within the scope of the Act for the first time, the occupier shall send a
written notice within 30 days from commencement of the Act.

Before a factory (with manufacturing process for less than 180 days a year) starts working,
and the Occupier shall send a written notice to Chief Inspector at least 30 days before
commencement of work.
Whenever a new manager is appointed, the occupier shall a written notice to the Chief
Inspector within 7 days from joining date. If No manager is appointed for any period, the
occupier himself, shall be deemed to be the manager of the factory.
INSPECTORS
The State Government may appoint Inspectors for the purposes of this Act. Every District
Magistrate shall be an Inspector for his district. The inspector have following powers:
« enter premises of factory, make examination of the premises, plant, machinery, article

« inquire into any accident

* require or seize or take copies of any prescribed register or any other document

« direct the occupier that any premises or any part thereof shall be left undisturbed
« take measurements and photographs

CERTIFYING SURGEONS

The State Government may appoint qualified medical practitioners to be Certifying Surgeons
with duties:
« examination and certification of young persons under this Act

« examination of persons engaged in factories in such dangerous occupations or processes

« medical supervision of cases of illness, due to the nature of the work.

HEALTH PROVISIONS

Cleanliness
* Floor shall be cleaned at least once a week

* Walls to be painted (non-washable water-paint) at least once in 5 years. Once in 3 years in

case of washable water-paint
* Walls to be washed at least once in 6 months.

* Walls to be whitewashed. or colourwashed at least once in 14 months * Doors and window

shall be painted or varnished - every 5 years Disposal of wastes and effluents

* Arrangements shall be made in every factory for the treatment of wastes and effluents.
Ventilation and temperature
« Provision shall be made in every factory for adequate ventilation and suitable temperature.
Dust and fume
« Effective measures shall be taken to prevent inhalation of dust and fumes by workers.
Artificial humidification
« Provisions to be made for adequate ventilation and cooling of the air for management of
humidity Overcrowding

« In every workroom, there shall be at least 14.2 cubic metres of space for every worker,
which includes space of 4.2 metres ahove the level of the floor of the room. For factories in
existence on the date of the commencement of this Act, it is 9.9 cubic metres of space for
every worker. Lighting

« Sufficient and suitable lighting, natural or artificial, or both Drinking water

« Sufficient supply of wholesome drinking water to be provided.

* Drinking water shall not be within 6 metres of any washing place, urinal, latrine, spittoon.

* For more than 250 workers, "cool drinking water" to be provided during hot weather.
Latrines and urinals
« Sufficient latrine and urinal accommodation of prescribed types shall be provided

* For more than 250 workers, latrine/urinal shall be of prescribed sanitary types

* Floors and internal walls shall be in glazed tiles/smooth polished surface up to a height of
90 crns.
« Latrines and urinals shall be washed and cleaned every 7 days Spittoons

« Sufficient number of spittoons in convenient places

SAFETY PROVISIONS
If 1000 or more workers are employed, or any manufacturing process with risk of bodily
injury, poisoning or disease, or any other hazard to health, the occupier shall employ "safety
Officers"

PROVISIONS FOR HAZARDOUS PROCESSES - SITE APPRAISAL

COMMITTEES
The State Government may appoint a "Site Appraisal Committee”, for seeking advise on
permission for the initial location of a factory involving a hazardous process, consisting of:
(a) Chief Inspector of the State who shall be its Chairman;
(b) a representative of the Central Board for the Prevention and Control of Water Pollution
(c) a representative of the Central Board for the Prevention and Control of Air Pollution
(d) a representative of the State Board appointed under the Water Pollution Act, 1974
(e) a representative of the State Board for the Prevention and Control of Air Pollution.
(f) a representative of the Department of Environment in the State;
(g) a representative of the Meteorological Department of the Government of India;

(h) an expert in the field of occupational health; and

(i) a representative of the Town Planning Department of the State Government

(j) not more than 5 other members who may be co-opted by the State Government, who shall
be -

« a scientist having specialised knowledge of the hazardous process

* a representative of the local authority

* not more than 3 other persons as deemed fit by the State Government. Site Appraisal
Committee will give its recommendation to State Government within a period of 90 days.

Where any factory is controlled by Central Government, the State Government shall co-opt in
the Site Appraisal Committee a nominee of the Central Government as a member of that
Committee.

HAZARDOUS PROCESS
The occupier of every factory involving a hazardous process shall disclose all information
regarding dangers, including health hazards and the measures to overcome such hazards

(a) to the workers employed in the factory,

(b) the Chief Inspector,

(c) the local authority within whose jurisdiction the factory is situate and the (d) general
public in the vicinity.
Every occupier shall inform to Chief Inspector. within 30 days, of Commencement of
hazardous process.

The occupier will ensure medical examination of every worker (working in hazardous
process),

(a) before such assigned to such job to worker

(b) while in such job, at intervals not exceeding 12 months.

The Central Government may, in the event of the occurrence of an extraordinary situation in
a factory engaged in a hazardous process, appoint an “Inquiry Committee". The Committee
appointed consist of a chairman and 2 other members. The recommendations of the
Committee shall be advisory in nature.
Where no standards of safety have been prescribed in respect of a hazardous process, the
Central Government may direct the Director-General of Factory Advice Service and Labour
Institutes or any institution to lay down emergency standards for such hazardous processes.

The maximum permissible threshold limits of exposure of chemical and toxic substances in
manufacturing processes (whether hazardous or otherwise) are listed in the Second Schedule

Workers' participation in safety management- The occupier shall, in every factory where a
hazardous process takes place, set up a Safety Committee consisting of equal number of
representatives of workers and management to promote co-operation between the workers
and the management.
Right of workers to warn about imminent danger- Where the workers have reasonable
apprehension that there is a likelihood of imminent danger to their lives or health due to any
accident, they may bring the same to the notice of the occupier. directly or through Safety
Committee. It shall be the duty of Occupier to take immediate remedial action and send a
report of the action taken to the nearest Inspector.
WELFARE PROVISIONS
Provision will also be mandatorily made for

(i) Washing Facilities

(ii) Facilities for Storing and Drying Clothing

(iiii) Facilities for Sitting.

First-aid appliances At least 1 first-aid box for every 150 workers. If number of workers is
more than 500, an ambulance room will be provided.
Canteen A canteen, if more than 250 workers are employed. Constitution of a "managing
committee” for the canteen and representation of the workers in the management of the
canteen.
Shelters, rest rooms and lunch rooms Adequate and suitable shelters or rest rooms and a
suitable lunch room, with provision for drinking water shall be provided in every factory with
more than 150 workers.
Creche in factory with more than 30 women workers, for use of children below 6 years will
be provided. Welfare officers The occupier shall employ "Welfare officers” for a factory with
more than 500 workers. WORKING HOURS OF ADULTS No adult workers shall be
allowed to work in a factory for more than 48 hours in any week.
Weekly holidays -No adult worker shall be required or allowed to work in a factory on the
first day of the week, unless he has/will have a holiday for a whole day on one of the 3 days
immediately before or after the said day. There has to be a weekly holiday.
Compensatory holidays If a worker is deprived of weekly holidays, he shall be allowed,
within 2 months immediately following that month, compensatory holidays of equal number
to the holidays so lost.
Daily hours No adult worker will work in a factory for more than 9 hours in a day. Intervals
for rest No worker shall work for more than 5 hours before he had rest of at least half an
hour. Spread over The periods of work of an adult worker shall be so arranged that inclusive
of his intervals, they shall not spread over more than 10.5 hours in any day.
Power to make exempting rules The State Government has power to make exempting rules,
within following conditions:
(i) the total number of hours of work in any day shall not exceed 10.
(i) the spread over, inclusive of intervals for rest, shall not exceed 12 hours in any one day.
(iiii) the total number of hours of work in a week, including overtime., shall not exceed 60.
(iv) the total number of hours of overtime shall not exceed 50 for any one quarter. Here
"Quarter” means a period of 3 consecutive months beginning on the 1st of January, the 1st of
April the 1st of July or the 1 St of October. Such Rules under this section shall remain in
force for not more than 5 years.
Night shifts Where a worker works on a shift which extends beyond midnight, he will get a
holiday for a whole day (for a period of 24 consecutive hours beginning when his shift ends)
Prohibition of overlapping shifts Work shall not be carried in any factory by means of a
system of shifts so arranged that more than one relay of workers is engaged, in work of the
same kind at the same time.
Extra wages for overtime Where a worker works for more than 9 hours in any day or for
more than 48 hours in any week, he shall, be entitled to wages at the rate of TWICE his
ordinary rate of wages. Here "ordinary rate of wages" means the basic wages plus such
allowances and INCLUDES cash equivalent of concessional sale of food grains and other
articles, but DOES NOT include a bonus and wages for overtime work.
If any worker is paid on a "piece-rate basis", the time rate shall be equivalent to the daily
average of their full-time earnings for the days on which they actually worked on the same or
identical.
The cash equivalent the concessional sale of food grains and other articles shall be computed
as may be prescribed on the basis of the maximum quantity of food grains/articles admissible
to a standard family.
Here "Standard family” means a family consisting of the worker, his or her spouse and two
children below the age of 14 years requiring in all three adult consumption units.
Here "Adult consumption Unit" means the consumption unit of a male above the age of 14
years. The consumption unit of a female above 14 years, and a child below 14 years shall be
calculated at the rates of 0.8 and 0.6 respectively of one Adult consumption Unit.
Further restrictions on employment of women No women shall be allowed to work except
between the hours of 6 A.M. and 7 P.M. The State Government may make exemptions to this
but still no exemptions allowed between the hours of 10 P.M. and 5 A.M. The exemptions
made by State Government shall remain in force for not more than 3 years at a time
There shall be no change of shifts except, after a weekly holiday or any other holiday.
EMPLOYMENT OF YOUNG PERSONS
Prohibition of employment of young children No child of below 14 year shall work in any
factory.
Both child and adolescent shall be required to have
(a) a certificate of fitness from surgeon and
(b) a token giving a reference to such certificate.
Certificates of Fitness The certifying surgeon, after examination, may grant a certificate of
fitness (Certifying as child or as adult) to work in a factory as a child, which shall be valid
only for 12 months.
No female adolescent or a male adolescent who has not attained the age of 17 years but who
has been granted a certificate of fitness to work in a factory as an adult, shall be required or
allowed to work in any factory except hetween 6 A.M. and 7 P.M
Working hours for children No child shall be employed
(a) for more than 4.5 hours any day or
(b) during night. Here "night" shall mean a period of at least 12 consecutive hours which
including the interval between 10 P.M. and 6 A.M.
The period of work of all children shall be limited to 2 shifts which shall not overlap or
spread over more than 5 hours each
No female child shall be required to work in any factory except between 8 A.M. and 7 P.M.
V Notice of periods of work for children shall be displayed and correctly maintained in every
factory.
ANNUAL LEAVE WITH WAGES
Every worker who has worked for 240 days or more in a calendar year shall be allowed leave
with wages during the subsequent calendar year, at the rate of -
(i) if an adult, one day leave for every 20 days of work
(i) if a child, one day leave for every 15 days of work
Following shall be deemed to be days on which the worker has worked for the purpose of
computation of the period of 240 days:
(a) any days of lay off, by agreement or contract or as permissible under the standing orders;
(b) maternity leave
(c) leave earned in the year prior to that in which the leave is enjoyed (leave with wages) The
leave admissible under this sub-section shall be exclusive of all holidays.
If a worker is discharged/dismissed/quits/superannuated/dies, he shall be entitled to wages in
lieu of the quantum of leave to which he was entitled, even if he had not worked for the Wire
240 days. This payment will be made:

« in case of discharged/dismissed/quits- within 2 working days

« in case of superannuated/dies- within 2 months

If a worker does not take the whole of the leave allowed, it shall be added to the leave in
succeeding calendar year. Provided that the total leaves that may be carried forward shall not
exceed 30 in the case of an adult or 40 in the case of a child:
A worker can apply for leave with 15 days notice, provided that the application shall be made
not less than 30 days before the date of leave, if he is employed in a public utility service.
Further leave may be taken for maximum of 3 times in a year.
If a worker wants to take leave for illness, he shall be granted leave even if 15 days notice is
not submitted. Further worker shall be paid "advance” within 15 days from the date of the
application for leave (30 days in case of public utility service.
The unavailed leave of a worker shall not be taken into consideration in computing the period
of any notice required to be given before discharge or dismissal
Payment in advance in certain cases A worker who has been allowed leave for not less than 4
days (in the case of an adult), and 5 days (in the case of a child), shall, before his leave begins
be paid the wages due for the period of the leave allowed.
Mode of recovery of unpaid wages Any sum required to be paid by an employer for leaves,
but not paid by him shall be recoverable as delayed wages under the provisions of the
Payment of Wages Act, 1936.
SPECIAL PROVISIONS
Power to apply the act to certain premises The State Government may apply provisions of
this Act at manufacturing places if:
* Number of workers is less than 10, if working with the aid of power and less than 20 if
working without the aid of power
« Persons working therein are not employed by the owner thereof but are working with the
permission of, or under agreement with, such owner. Here "owner" shall include a lessee or
mortgage with possession of the premises. Dangerous operations If the State Government
thinks that any manufacturing operation has serious risk of bodily injury, poisoning or
disease, it may:
(a) specifying the manufacturing process or operation and declaring it to be dangerous;
(b) prohibiting or restricting the employment of women, adolescents or children;
(c) periodical medical examination of persons employed, and requiring the payment by the
occupier of fees for medical examination;
(d) providing for the protection of all persons employed and in the vicinity.
(e) prohibiting, restricting or controlling the use of any specified materials or processes

(d) requiring the provision of additional welfare amenities and sanitary facilities and the
supply of protective equipment and clothing.

Power to prohibit employment on account of serious hazard If Inspector thinks there may be
serious hazard by way of injury/death, he may prohibit occupier from employing any person
in the factory or limit the minimum number of persons necessary to attend to the minimum
tasks till the hazard is removed. This order can be only for 3 days until extended by the Chief
Inspector by a subsequent order.
Any person aggrieved by an order of the Inspector or Chief Inspector, can appeal to the High
Court.

Notice of certain accidents If an accident occurs which causes death, or which causes any
bodily injury by reason of which the person injured is prevented from working for a period of
48 hours or more, the "manager” of the factory shall send notice to the Authority. If the
accident has caused death, the authority, after receiving notice shall make an inquiry within 1
month of the receipt of the notice.
Similarly notice of Hazardous accidents will be reported to the authorities.
Notice of certain diseases If any worker contracts any disease specified in the "Third"
Schedule, the manager shall send notice to authorities.
PENALTIES
Contravention of provisions of this Act, the occupier and manager of the factory shall each
punishable with Imprisonment up to 2 years or with fine up to Rs 100000 or both. If the
contravention is continued after conviction, further fine up to Rs 1000 for each day. Further,
If there is any contravention of any of the provisions of "Safety or provisions relating to
hazardous processes” has resulted in an accident causing death or serious bodily injury, Fine
minimum of Rs 25000 in the case of an accident causing death, and Rs 5000 in the case of an
accident causing serious bodily injury.
Here serious bodily injury means an injury which involves, the permanent loss of the use of,
or permanent injury to any limb or the permanent loss of, or injury to, sight or hearing, or the
fracture of any bone, but shall not include, the fracture of bone or joint (not being fracture of
more than one bone or joint) of any phalanges of the hand or foot.
Enhanced penalty after previous conviction If any person who is again guilty of an offence
involving a contravention of the same provision- Imprisonment up to 3 years or fine upto Rs
10000 (which may extend to 2 lakh) or with both. Further, If there is any contravention of
any of the provisions of "Safety or provisions relating to hazardous processes" has resulted in
an accident causing death or serious bodily injury, Fine minimum of Rs 35000 in the case of
an accident causing death, and Rs 10000 in the case of an accident causing serious bodily
injury. Repeated conviction should be within 2 years.

Penalty for obstructing Inspector Wilful obstructs an Inspector - Imprisonment up to 6

months or Fine up to Rs 10000 or with both.
Penalty for wrongfully disclosing results of analysis (sampling by Inspector) Imprisonment
up to 6 months or Fine up to Rs 10000 or with both.

Penalty for contravention of the provisions of hazardous processes Imprisonment up to 7

years or Fine up to Rs 2 Lakh or with both. Additional fine up to Rs 5000 for every day
during which such failure or contravention continues. If contravention continues for beyond 1
year, Imprisonment up to 10 years.

Offences by workers (Obligations of workers) Fine of Rs 500 Using false certificate of fitness
Imprisonment up to 2 months or Fine up to Rs 1000 or with both. Penalty for permitting
double employment of child Fine of Rs 1000
APPEALS
The manager or the occupier, against any order, may appeal within 30 days of the service of
the order, to the prescribed authority.
OBLIGATIONS OF WORKERS
No worker in a factory
(a) shall wilfully interfere with or misuse any appliance, convenience or other thing provided
in a factory for the purposes of securing the health, safety or welfare of the workers therein;
(b) shall wilfully and without reasonable cause do anything likely to endanger himself or
others; and

(c) shall wilfully neglect to make use of any appliance or other thing provided in the factory
for the purposes of securing the health or safety of the workers therein.
If any worker employed in a factory contravenes any of the provisions of this section -
Imprisonment up to 3 months, or Fine up to Rs 1000

RIGHT OF WORKERS
Every worker shall have the right to

(i) obtain from the occupier, information relating to workers' health and safety at work,
(ii) get trained within the factory wherever possible, or, to get himself sponsored by the
occupier for getting trained at a training center or institute, duly approved by the Chief
Inspector, where training is imparted for workers' health and safety at work,

(iii) represent to the Inspector directly or through his representative in the matter of
inadequate provision for protection of his health or safety in the factory.

LIST OF SCHEDULES
Schedule I: List of industries involving hazardous processes
Schedule II: Permissible levels of certain chemical substances in work environment Schedule
III: List of notifiable diseases
FACTORIES (AMENDMENT) BILL, 2016 (This is still a Bill and Act not passed)

The Factories (Amendment) Bill. 2016 was introduced in Lok Sabha on August 10, 2016 by
the Minister for Labour and Employment, Mr. Bandaru Dattatreya. Power to make rules on
various matters: The Act permits the "state government” to prescribe rules on a range of
matters, including double employment, details of adult workers to be included in the factory's
register, conditions related to exemptions to certain workers, etc. The Bill gives such rule
making powers to the "central government" as well. Powers to make rules for exemptions to
workers: Under the Act, the state government may make rules to

(i) define persons who hold management or confidential positions; and

(ii) exempt certain types of adult workers (e.g. those engaged for urgent repairs) from fixed
working hours, periods of rest, etc. The Bill gives such rule making powers to both, the
central and state governments. Overtime hours of work in a quarter: The Act permits the state
government to make rules related to the regulation of overtime hours of work. However, the
total number of hours of overtime must not exceed 50 hours for a quarter. The Bill raises this
limit to 100 hours. Rules in this regard may be prescribed by the central government as well.
Overtime hours if factory has higher workload: The Act enables the state government to
permit adult workers in a factory to work overtime hours if the factory has an exceptional
work load. Further the total number of hours of overtime work in a quarter must not exceed
75. The Bill permits the central or state government to raise this limit to 1 15.
Overtime in public interest: The Bill introduces a provision which permits the central or state
government to extend the 115-hour limit to 125 hours. It may do so because of
(i) excessive work load in the factory and
(ii) public interest.
 CONTRACT LABOUR (REGULATION AND ABOLITION) ACT, 1970

APPLICATION
The Act applies to every establishment in which 20 or more workmen are employed or were
employed on any day of the preceding 12 months as contract labor.

It shall not apply to establishments in which work only of an intermittent or casual nature is
performed. If a question arises whether work performed in an establishment is of intermittent
or casual nature, the Appropriate Government shall decide that question after consultation
with the Central Board or, as the case may be, a State Board and its decision shall be final.

Work performed in an establishment shall not be deemed to be of an intermittent nature: - « If

it was performed for more than 120 days in the preceding 12 months, or « If it is of a seasonal
character is performed for more than 60 days in a year.
DEFINITIONS

Appropriate Government means "Central Government” for an establishment under the

Industrial Disputes Act, 1947 and is "State Government" for all other cases. Controlled
Industry means any industry the control of which by the Union has been declared by any
Central Act to be expedient in the public interest; Wages shall have the meaning assigned to
it in Payment of Wages Act, 1936. Contractor means a person who undertakes to produce a
given result for the establishment, other than a mere supply of goods or articles of
manufacture-to such establishment, and includes a sub-contractor; Establishment means-
Any office or department of the Government or a local authority: or * Any place where any
industry, trade, business, manufacturer or occupation is carried on, Principal employer
means: * Head of that office or department or such other officer as the Government or the
local authority « Owner or occupier or Manager of the factory/mine « Any person responsible
for the supervision and control of the establishment. Workman means any worker of any
establishment but does NOT include any such person-(a) Who is employed mainly in a
managerial or administrative capacity; or (b) Who, being employed in supervisory capacity
draws wages exceeding Rs 500 per mensem (c) Who is an out-worker.
CENTRAL ADVISORY BOARD

The Central Government shall constitute a Board to be called the "Central Advisory Contract
Labor Board" (hereinafter referred to as the Central Board) to advise the Central
Government. The Central Board shall consist of-(a) a Chairman to be appointed by the
Central Government; (b) the Chief Labor Commissioner (Central), ex officio; (c) number of
members, not exceeding 17 but not less than 11. Number of members nominated to represent
the workmen shall not be less than the number of members nominated to represent the
principal employers and the contractors.
STATE ADVISORY BOARD

The State Government may constitute a Board to be called the "State Advisory Contract
Labor Board" (hereinafter referred to as the State Board) to advise the State Government. The
State board shall consist of-(a) a Chairman to be appointed by the State Government; (b) the
Labor Commissioner, ex officio (c) Number of members, not exceeding 1 1 but not less than
9. Number of members nominated to represent the workmen shall not be less than the number
of members nominated to represent the principal employers and the contractors.

REGISTERING OFFICERS

The appropriate government may, appoint -Registering Officers".

Every principal employer of an establishment (where this Act applies) shall, make an
application to the Registering Officer for registration of the establishment. The Registering
Officer shall register the establishment and issue a certificate of registration.

If the Registering Officer finds that the registration has been obtained by misrepresentation
any material fact, he may revoke the registration after giving an opportunity to the principal
employer to be heard and with the previous approval of the appropriate Government.

LICENSING OFFICERS
he appropriate government may appoint "Licensing Officers'.
Every application for the grant of a licence shall contain the particulars regarding the location
of the establishment, the nature of process, operation or work for which contract labour is to
be employed and such other particulars as may be prescribed.

The licensing officer may make such investigation in respect of the application received. The
Licensing Officer has powers to revoke the licence. Any person aggrieved by an order by
Registering Officer or Licencing Officer may prefer an appeal to the Appellate Officer within
30 days from the date of Order.

WELFARE AND HEALTH OF LABOUR

It shall be the duty of every contractor employing contract labor to provide facilities for: «
Drinking-water « Latrines and urinals + Washing facilities * Canteen * First aid box * Rest
rooms

A contractor shall be responsible for payment of wages to each worker employed by him as
contract labour within time. In case the contractor fails to make payment of wages within
time, or makes short payment, then the principal employer shall be liable to make payment of
wages.
PENALTIES
Whoever obstructs/refuses an inspector in the discharge of his duties- Imprisonment upto 3
months, or Fine up to Rs 500, or with both.
Contravention of provisions regarding employment of contract labour Imprisonment upto 3
months, or Fine upto Rs 1000, or with both. For Continued Contravention, additional fine
upto Rs 100 for every day.

Any other offences under this Act- Imprisonment upto 3 months, or Fine up to Rs 1000
LIMITATION OF PROSECUTIONS

No Court shall take cognizance of an offence unless the complaint thereof is made within 3
months from the date on which the alleged commission of the offence came to the knowledge
of an inspector. If the offence consists of disobeying a written order made by an inspector,
complaint, may be made within 6 months of the date on which the offence is alleged to have
been committed.

INSPECTING STAFF
The appropriate Government may, appoint such persons as it thinks fit to be inspectors for the
purposes of this Act.
REGISTERS AND OTHER RECORDS
Every principal employer and every contractor shall maintain such registers and records
giving such particulars of contract labour employed, the nature of work performed by the
contract labour, the rates of wages paid to the contract labour.
 MINIMUM WAGES ACT, 1948

The Minimum Wages Act 1948 is an Act of Parliament concerning Indian labour law that
sets the minimum
« wages that must be paid to skilled and unskilled labours.
In the Central sphere, the Act is enforced through the Central Industrial Relations Machinery
(CIRM). CIRM is an attached office of the Ministry of Labour and is also known as the Chief
Labour Commissioner (Central) [CLC(C)] Organisation. The CIRM is headed by the Chief
Labour Commissioner (Central). While. the State Industrial Relations Machinery ensures the
enforcement of the Act at the State level.

DEFINITIONS
Child means a person who has not completed his 14th year of age;

Adolescent means a person who has completed his 14th year of age but has not completed his
18th year;

Adult means a person who has completed his 18th year of age;
Appropriate government is "Central Government" for any scheduled employment under the
Central Government, railway, mines, oil fields, major ports. For any other employment it is
"State Government"
Cost of living index number means cost of living index number applicable to employees in
employment, declared by the competent authority by notification in the Official Gazette.

Employee means any person who is employed to do any work, skilled or unskilled, manual or
clerical, in a scheduled employment in respect of which minimum rates of wages have been
fixed. BUT does not include any member of the Armed Forces.
Wages means all remuneration capable of being expressed in terms of money, but DOES
NOT include-

« house accommodation, supply of light, water, medical attendance,

« other amenity or any service excluded by general or special order of the appropriate
Government;

* Pension Fund or Provident Fund or under any scheme of social insurance;

« Travelling allowance or the value of any travelling concession:

* Special expenses entailed on him by the nature of his employment;

« Gratuity payable on discharge;

FIXING OF MINIMUM RATES OF WAGES
The appropriate Government shall:
(a) fix the minimum rates of wages for employment specified in Part IT of the Schedule
(b) review at intervals not exceeding 5 years, and revise the minimum rates, if necessary. The
appropriate Government may refrain from fixing minimum rates of wages in respect of any
scheduled employment in which there are less than 1000 employees in the whole State.
The appropriate Government may fix-

* Minimum rate of wages for time work (minimum time rate)

* Minimum rate of wages for piece work (minimum piece rate);

* Minimum rate of remuneration to apply in the case of employees employed on piece work
for the purpose of securing to such employees a minimum rate of wages on a time work basis
(guaranteed time rate)
* Minimum rate (whether a time rate or a piece rate) to apply in substitution for the minimum
rate which would otherwise be applicable, in respect of overtime work (overtime rate). In
fixing or revising minimum rates of wages, different minimum rates of wages may be fixed
for-

(i) different scheduled employments;

(ii) different classes of work in the same scheduled employment;
(iii) adults, adolescents, children and apprentices;

(iv) different localities;

Minimum rates of wages may be fixed by any one or more of the following wage periods:

(i) by the hour,

(ii) by the day,

(iii) by the month,

(iv) by such other larger wage-period as may be prescribed.

Different minimum rates of wages may be fixed for—
(i) different scheduled employments;

(ii) different classes of work in the same scheduled employment;

(iii) adults, adolescents, children and apprentices;

(iv) different localities;

MINIMUM RATES OF WAGES

The appropriate Government may fix:

(i) a basic rate of wages and a special allowance to accord the variation in the cost of living
index number applicable to such workers (hereinafter referred to as the 'cost of living
allowance')
(ii) a basic rate of wages with or without the cost of living allowance, and the cash value of
the concessions in respect of supplies of essential commodities at concession rates.

(iii) an all-inclusive rate allowing for the basic rate, the cost of living allowance and the cash
value of the concessions.

PROCEDURE FOR FIXING AND REVISING MINIMUM WAGES

For the purpose of fixing minimum rates of wages, the appropriate Government shall either-+
appoint as many committees and sub-committees as necessary to hold enquiries and advise it.
OR -+ publish its proposal and specify a date, not less than 2 months from the date of the
notification, on which the proposals will be taken into consideration. The appropriate
Government shall consult the Advisory Board also. After considering the advice of the
committee and all representations received by it before the date specified, the appropriate
Government shall fix/revise the minimum rates of wages in respect of each scheduled
employment. It shall come into force on the expiry of 3 months from the date of its issue:

ADVISORY BOARD
The appropriate Government shall appoint an "Advisory Board" for advising the Government
generally in the matter of fixing and revising minimum rates of wages, and co-ordinating the
work of committees and sub-committees.

CENTRAL ADVISORY BOARD

The Central Government shall appoint a "Central Advisory Board" for the purpose of
advising the Central and State Governments in the matters of the fixation and revision of
minimum rates of wages and for co-coordinating the work of the "Advisory Board".

The Central Advisory Board shall consist of persons:

* Nominated by the "Central Government" representing employers and employees, who shall
be equal in number,

« Independent persons not exceeding one-third of its total number of members;

* One of such independent persons shall be appointed the Chairman of the Board

Each of the committees, sub-committees and the Advisory Board shall consist of persons:

* Nominated by the appropriate Government representing employers and employees in the

scheduled employments, who shall be equal in number
+ Independent persons not exceeding one third of its total number of members

* One of such independent persons shall be appointed the Chairman.

Minimum wages payable under this Act shall be paid in cash.

NORMAL WORKING DAY

The appropriate Government may-

(a) fix the number of hours of work which shall constitute a normal working day, inclusive of
one or more intervals;

(b) provide for a day of rest in every 7 days

(c) provide for payment for work on a day of rest at a rate not less than the overtime rate.
BUT the appropriate Government will do so ONLY in following cases:

(a) employees engaged on urgent work, or in any emergency which could not be foreseen or
prevented;
(b) employees engaged in preparatory or complementary work which must necessarily be
carried on outside the limits laid down for the general working in the employment concerned;

(c) employees whose employment is essentially intermittent;

(d) employees engaged in any work which for technical reasons has to be completed before
the duty is over;
(e) employees engaged in a work which could not be carried on except at times dependent on
the irregular action of natural forces.
A OVERTIME

Where an employee, whose minimum rate of wages is fixed, works on any day in excess of
the number of hours constituting a normal working day, the employer shall pay him overtime
rate fixed under this Act.

MINIMUM TIME RATE WAGES FOR PIECE WORK

Where an employee is employed on piece work for which minimum time rate and not a
minimum piece rate has been fixed, the employer shall pay wages at not less than the
minimum time rate.

MAINTENANCE OF REGISTERS AND RECORDS

Every employer shall maintain registers/records of employees employed by him, the work
performed by them, the wages paid to them, the receipts given by them etc.
The appropriate Government may provide for the issue of wage books or wage slips to
employees. (INSPECTORS e.,) The appropriate Government may appoint "Inspectors” for
the purposes of this Act.

CLAIMS
The appropriate Government may appoint any of following to be the authority to hear and
decide all claims arising out of payment of less than the minimum rates of wages:
« any Commissioner for Workmen's Compensation Act.

« any Officer of the Central Government

« any officer of the State Government not below the rank of Labour Commissioner

« any other officer with experience as a Judge of a Civil Court or as a stipendiary Magistrate

Where an employee has any claims under this Act, he may present an application within 6
months from the date on which the minimum wages became payable. The application may be
admitted beyond 6 months, if there is sufficient cause to the satisfaction of the authority. The
application may be submitted by the employee himself, or any legal practitioner or any
official of a registered trade union authorized, or any Inspector, or any person acting with the
permission of the Authority.
When application is made, the authority shall hear both applicant and employer and then may
direct-(i) in the case of a claim arising out of payment of less than the minimum rates of
wages, the payment to the employee of the amount by which the minimum wages payable to
him exceed the amount actually paid, together with the payment of such compensation, not
exceeding 10 times the amount of such excess; (ii) in any other case, the payment of the
amount due to the employee, together with the payment of such compensation, not exceeding
Rs 10, and the Authority may direct payment of such compensation in cases where the excess
or the amount due is paid by the employer to the employee before the disposal of the
application.
If the authority hearing any application, finds that it was either malicious or vexatious, it may
direct that a penalty not exceeding Rs 50 be paid to the employer by the person presenting the
application.
Every direction of the Authority under this section shall be final.

PENALTIES

If employer pays less than the minimum rates of wages fixed- Imprisonment up to 6 months,
or Fine up to Rs 500 or both. Other offences are punishable with Fine up to Rs 500.
POWERS

Power of State Government to add to Schedule: The Appropriate Government can add to
either Part of the Schedule any employment in respect of which it is of opinion that minimum
rates of wages should be fixed, with notice of 3 months. Power of the Central Government to
give directions: The Central Government may give directions to a State Government as to the
carrying into execution of this Act in the State.

Power of the Central Government to make rules: The Central Government may make rules
prescribing terms of office of the members, the procedure to be followed in the conduct of
business, the method of voting, the manner of filling up casual vacancies in membership and
the quorum necessary for the transaction of business of the "Central Advisory Board". Part I
of Schedule- List of scheduled employment Part II of Schedule-- Employment in agriculture,
in any form of farming, including the cultivation and tillage of- the soil, dairy firming, the
production, cultivation, growing and harvesting of any agricultural or horticultural
commodity, the raising of live-stock, bees or poultry, and any practice performed by a farmer
on a farm as incidental to or in conjunction with farm operations (including Any forestry or
timbering operation)
 PAYMENT OF WAGES ACT, 1936

The Payment of Wages Act, 1936 is a central legislation which has been enacted to regulate
the payment of wages to workers employed in certain specified industries.
DEFINITIONS
Appropriate Government is 'Central Government" for railway, air transport services, mine,
oilfield. For all other establishments, it is "State Government" Employed person includes the
legal representative of a deceased employed person; Employer includes the legal
representative of a deceased employer Factory means a factory as defined in the Factories
Act, 1948. Mine has the meaning assigned to it in the Mines Act, 1952. Plantation has the
meaning assigned to it in the Plantations Labour Act, 1951. Industrial or other establishment
means any
* tramway service, or motor transport service engaged in carrying passengers or goods

« air transport service other than military

« dock, wharf or jetty, inland vessel, mechanically propelled:

* mine, quarry or oil-field, plantation;

« workshop or other establishment in which articles arc produced, adapted or manufactured.

« establishment in which any work relating to the construction, development or maintenance

of buildings, roads, hridges or canals, or connected with navigation, irrigation or the supply
of water Wages means all remuneration (whether by way of salary, allowances, or otherwise).
It includes:

« any award or settlement between the parties or order of a court

« overtime work or holidays or any leave period

« any additional remuneration payable under the terms of employment

« any sum at time of termination of employment

« any sum under any scheme But it does NOT include:

* Any bonus, profit sharing or otherwise, which is not form part of the remuneration payable.

* Any house-accommodation, or of the supply of light, water, medical attendance

» Contribution to any pension or provident fund, and the interest

* Any travelling allowance or the value of any travelling concession

* Any sum paid to defray expenses entailed on him by the nature of his employment

* Any gratuity payable on the termination of employment

APPLICABILITY

The Act is applicable to persons employed in any factory (defined above), to persons
employed (otherwise than in a factory) upon any railway, either directly or through a sub-
contractor, and to persons employed in an industrial or other establishments (defined above).
a The State Government may extend the provisions of this Act to any class of persons
employed in any establishment after giving 3 months' notice.
Earlier the Act was applicable only to workers with wages up to Rs 6500 per month. The
Central Government, in 2007, on the basis of figures of the Consumer Expenditure Survey
published by the National Sample Survey Organisation, NSSO, increased it to Rs 10,000 per
month. Further in 2012, the Central Government, enhanced this limit to Rs 18,000 per month.
Further in August 2017 the Government revised it to Rs 24,000 per month.

PAYMENT OF WAGES

The wages will be paid before 7th day, if less than 1000 persons are employed. The wages
will be paid before 10th day, for all other cases.
No wage period shall exceed One Month.

If the workman is terminated, he shall be paid wages before the expiry of the 2nd working
day from date of termination.
All wages shall be paid in current coin, currency notes, or both. After obtaining the written
authorisation of the employed person. Employer may pay him by cheque or by crediting in
his bank account. After 2017 amendment in the Act, Now Employers can pay wages via
(i) in coin or currency notes; or

(ii) by cheque; or
(iii) by crediting them into his bank account. The Amendment has removed the requirement
of obtaining written authorization from employee.

DEDUCTIONS WHICH MAY BE MADE FROM WAGES

Any loss of wages resulting from the imposition of following penalties will not be deemed as
deduction:
(i) the withholding of increment or promotion
(i) the reduction to a lower post or time scale or to a lower stage in a time scale;
(iii) suspension;
Deductions from the wages can be made only for:
(a) fines;
(b) deductions for absence from duty;

(c) deductions for damage/ loss of goods/money directly attributable to neglect of workman

(d) deductions for house-accommodation

(e) deductions for amenities and services supplied by the employer
(f) deductions for recovery of advances or loans made from any labour welfare fund

(g) deductions of income-tax payable by the employed person;

(h) deductions required to be made by order of a Court or other authority,

(i) deductions for subscriptions to provident fund

(j) deductions for payments to co-operative societies
(k) deductions, for life insurance policy or trade union fund or any insurance policy.

(1) deductions, for payment of insurance premium on Fidelity Guarantee Bonds;

(m) deductions for recovery of losses sustained by a railway administration

The total amount of deductions, from the wages of any employed person shall not exceed:

* 75% of wages in cases where deductions are wholly or partly made for payments to co-
operative

* 50% of wages in any other case

FINES

* No fine shall be imposed on any workman, without approval of the State Government

« Information of Fines will be prominently displayed in the establishment.

* No tine shall be imposed on any workman, until he has been given an opportunity of
showing cause.

* The total amount of fine in a month, can not exceed an amount equal to 3% of the wages.

* No fine shall be imposed on any employed person who is under the age of 15 years.

« No fine shall be recovered after the expiry of 90 days from the day on which it was
imposed.

DEDUCTIONS
Deductions for absence from duty Amount of deduction can not be greater than proportion of
wage period for which he was absent. However if 10 or more persons acting in concert absent
themselves without due notice and without reasonable cause, such deduction can be up to
wages for 8 days

Deductions for damage or loss: Deduction can not exceed the amount of the damage/loss
caused to the employer by the neglect or default of the employed person.

Deductions for recovery of advances: Recovery of an advance of money given before

employment began shall be made from the first payment of wages but no recovery shall be
made of such advances given for travelling expenses.

MAINTENANCE OF REGISTERS AND RECORDS

Every employer shall maintain Registers/Records, for wages, fines, deductions and receipts
for a period of 3 years from date of last entry.

INSPECTORS

An Inspector appointed under "Factories Act, 1948" shall be an Inspector for this Act also.
The State Government may also appoint Inspectors for the purposes of this Act.

CLAIMS ARISING OUT OF DEDUCTIONS/DELAY FROM THE WAGES

The appropriate Government may appoint any of following as the authority to hear and
decide all claims arising out of deductions/delay from the wages:
(a) any Commissioner for Workmen's Compensation

(h) any officer of the Central Government exercising functions as

(i) Regional Labour Commissioner; or

(ii) Assistant Labour Commissioner with at least 2 years' experience

(c) any officer of the State Government not below the rank of Assistant Labour
Commissioner with at least 2 years' experience
(d) Presiding officer of any Labour Court or Industrial Tribunal, under Industrial Disputes
Act, 1947

(e) any other officer with experience as a Judge of a Civil Court or a Judicial Magistrate
Every such application for claim shall be presented within 12 months from the date on which
the deduction from the wages was made. The authority may consider the application beyond
12 months, if the applicant satisfies the authority with sufficient cause.
APPEAL

An appeal can be made within 30 days of the date on which the order was made, before the
District Court:
(a) by the employer if the total of wages and compensation exceeds Rs 3000
(b) by an employed person if the total amount of wages claimed exceeds Rs 20

PENALTIES

» Failure to maintain any records or registers or to furnish any information or return- Fine
between Rs 200 to Rs 1000.
« Wilfully obstructs an Inspector in the discharge of his duties- Fine between Rs 200 to Rs
1000.
« If any person is again guilty Second Time of an offence involving contravention of the same
provision, he shall be punishable- Imprisonment for 1-6 months and Fine of Rs 500-3000.
(For this Second offence should be within 2 years _from First Offence)

* Failure to pay the wages by the fixed date - Fine of Rs 100 for each day offailure.

AMENDMENTS IN THE ACT IN 2017

As per earlier provisions, Under the Act. all wages must be paid either in coin or currency
notes, or both. However, the employer may pay his employee's wages either by cheque or by
crediting it into his bank account, after obtaining his written authorisation.
After this 2017 amendment, the Act will now allow employers to pay wages via

(i) in coin or currency notes; or

(ii) by cheque; or
(iii) by crediting them into his bank account. The Amendment has removed the requirement
Obtaining written authorisation from employee.
 PAYMENT OF BONUS ACT, 1965
The Payment of Bonus Act, 1965 was enacted to provide for the payment of bonus to persons
employed in certain establishments on the basis of profits or productivity and for the matters
connected therewith.

DEFINITIONS

Accounting year means-

« For corporation, the year ending on the day on which the books and accounts of the
corporation are to be closed.

« For a company, the period in which any profit and loss account of the company is
maintained.
* Year commencing from Ist April, for all other cases. Agricultural income shall have the
same meaning as in the Income-tax Act; Allocable surplus means-

* 67% of the "available surplus in an accounting year, in case of employer (other than a
Banking Company) with which has not made the arrangements prescribed under the Income-
tax Act for the declaration and payment of the dividends payable out of its profits.

= 60% of "available surplus" in all other cases (including banking companies and companies
linked with abroad). Appropriate Government is "Central Government" for all establishments
in which the appropriate Government under the Industrial Disputes Act, 1947 (14 of 1947), is
the Central Government. For all others, it is "State Government". Award means an interim or
a final determination of dispute under the Industrial Disputes Act, 1947. Employee means
any person (other than an apprentice) employed on a salary or wage not exceeding Rs 21000
per mensem in any industry. Salary or Wage means all remuneration (other than
remuneration in respect of over-time work) capable of being expressed in terms of money and
includes dearness allowance, but DOES NOT includes-

(i) any other allowance which the employee is for the time being entitled to;
(ii) value of any house accommodation, supply of light, water, medical attendance etc.
(iii) any travelling concession;
(iv) any bonus (including incentive, production and attendance bonus);

(v) any contribution to any pension fund or provident fund

(vi) any retrenchment compensation or any gratuity or other retirement benefit

(vii) any commission payable to the employee. However, if an employee is given in lieu of
the whole or part of the salary, free food allowance or free food by his employer, such food
allowance shall be deemed to form part of the salary or wage.
APPLICABILITY OF ACT

The Payment of Bonus Act applies to:-

(i) every factory as defined under the Factories Act, 1948; and

(ii) every other establishment in which 20 or more persons The Appropriate Government
may, after giving 2 months' notice, make the Act applicable to any factory or establishment
employing less than 20 but not less than 10 persons. The Act will remain applicable even if
number falls below 20, later point of time.

COMPUTATION OF GROSS PROFITS

The gross profits derived by an employer from an establishment in respect of the accounting
year shall-

* in the case of a banking company, be calculated in the manner specified in the First
Schedule

« in any other case, be calculated in the manner specified in the Second Schedule

ELIGIBILITY FOR BONUS

Employee shall be entitled to bonus, provided he has worked for at least for 30 working days
in that year.

An employee shall be disqualified from receiving bonus, if he is dismissed from service for-

(a) fraud; or
(b) riotous or violent behavior
(c) theft, misappropriation or sabotage of any property of the establishment.
PAYMENT OF MINIMUM BONUS
Bonus earned by employee in an accounting year will be

(a) minimum 8.33% of the salary during the accounting year or

(b) Rs 100, whichever is higher. If employee is below 15 years age, then minimum is Rs 60
in place of Rs 100. Where an employee has not worked for all the working days in an
accounting year, the minimum bonus shall be proportionately reduced.
The employees may enter into any special agreement with their employer for an annual bonus
linked with productivity, but under no such agreement, the bonus can be less than minimum
bonus as per the Act.

PAYMENT OF MAXIMUM BONUS

If in any accounting year, the allocable surplus exceeds the amount of minimum bonus
payable to the employees, then employer shall be bound to pay an amount in proportion to
the salary subject to a maximum of 20% of salary/wage.
CALCULATION OF BONUS WITH RESPECT TO CERTAIN EMPLOYEES
If salary or wage of an employee exceeds Rs 7000 per mensem, the bonus payable to Such
employee shall be calculated as if his salary or wage were Rs 7000 per mensem.

COMPUTATION OF NUMBER OF WORKING DAYS

Employee will be considered "Worked and Present" for days, during which he has been

(a) laid off

(b) on leave with salary or wage;

(c) absent due to temporary disablement caused by accident in the course of his employment;
(d) on maternity leave

SET ON AND SET OFF OF ALLOCABLE SURPLUS NEW ESTABLISHMENTS

Where the allocable surplus exceeds the maximum bonus payable, be carried forward for
being set on in the succeeding accounting year and so on up to and inclusive of the fourth
accounting year to be utilised for the purpose of payment of bonus in the manner illustrated in
the 4th Schedule. This is called "Set On".
Similarly, Where there is no available surplus in respect of that year, falls short of the amount
of minimum bonus payable to the employees, and there is no amount of sufficient amount
carried forward then, such minimum amount or the deficiency, shall be carried forward for
being set off in the succeeding accounting year and so on up to and inclusive of the zith
accounting year in the manner illustrated in the 4th Schedule. This is called "Set Off".

Where an establishment is newly set up, during first 5 years, the bonus shall be payable only
for the accounting year in which the employer derives profit. Principles of Set On and Set Off
will not apply. For the 6th Accounting Year, principles of Set On and Set Off will apply on
allocable surplus for 5th and 6th Years. For the 71" Accounting Year, principles of Set On
and Set Off will apply on allocable surplus for 5th ,6th and 7th Years. From 8th year, there
are no relaxations. An establishment shall not be deemed to be newly set up merely by reason
of a change In its location, management, name or ownership.

DEDUCTION OF CERTAIN AMOUNTS FROM BONUS

If an employee is found guilty of causing financial loss to the employer, then employer may
deduct the amount of loss from the amount of bonus but in respect of that accounting year
only.

TIME-LIMIT FOR PAYMENT OF BONUS

If there is a dispute regarding payment of bonus, within 1 month from the date of award. In
any other case, within a period of 8 months from the close of the accounting year.

APPLICATION OF ACT TO ESTABLISHMENTS IN PUBLIC SECTOR IN

CERTAIN CASES

If in any accounting year, an establishment in public sector sells any goods/services in

competition with an establishment in private sector, and the income from such sale is not less
than 20% of the gross income, then, provisions of this Act shall apply in relation to such
establishment in public sector.

RECOVERY OF BONUS DUE FROM AN EMPLOYER

Where any bonus due from his employer, the employee may make an application to the
appropriate Government for the recovery of the bonus. The appropriate Government shall
issue a certificate for that amount to the Collector who shall proceed to recover the same. The
application shall be made within 1 year.

REFERENCE OF DISPUTES
Where any dispute arises between an employer and his employees with respect to the honus,
such dispute shall be deemed to be an industrial dispute within the meaning of the Industrial
Disputes Act, 1947.

AUDITED ACCOUNTS

During proceedings of a dispute with a banking company (as employer), any trade union or
employees can not question the correctness of duly audited accounts. Although the trade
union may be permitted to obtain information necessary for verifying the amount of bonus.
When the appropriate govt/authority finds that the accounts of any employer have not been
audited, it may, direct the employer to get his accounts audited within timeline. If employer
still fails to get account audited, the authority may get the accounts audited by any auditor, it
thinks fit.
MAINTENANCE OF REGISTERS, RECORDS, ETC

Every employer shall prepare and maintain such registers, records and other documents.

INSPECTORS

The appropriate Government may, appoint "Inspectors" for the purposes of this Act.

PENALTIES
Failure to comply with provisions of Act - Imprisonment of 6 months or Fine of Rs 1000, or
with both.
SCHEDULES
Schedule I- Computation of Gross Profit in a Banking Company

Schedule II- Computation of Gross Profit in other than a banking company

Schedule ITI- List of Employers with permissible deductions from Gross Profit

Schedule IV- Calculation of Minimum and Maximum Bonus (Principle of set on and set off
of allocable surplus)

AMENDMENTS IN THE ACT IN 2015

The wage threshold for determining eligibility of employees has been revised from Rs 10,000
to Rs 21,000 per month. The calculation ceiling of Rs 3500 has now been doubled to Rs 7000
per month or the "minimum wage for the scheduled employment".
 PAYMENT OF GRATUITY ACT, 1972
Payment of Gratuity Act, 1972, provides for a scheme for the payment of gratuity to
employees engaged in factories, mines, oilfields, plantations, ports, railway companies, shops
or other establishments.

DEFINITIONS
Appropriate Government is "Central Government” for establishments which are:

+ Under the control of, the Central Government

« having branches in more than one State

+ a major port, mine, oilficld or railway company For all other establishments, "State
Government" is appropriate government.
Completed year of Service means continuous service for one year.

Family, in the case of a male employee is, himself, his wife, his children, whether married or
unmarried, his dependent parents and the dependent parents of his wife and the widow and
children of his predeceased son,
« if any. In the case of a female employee the family is herself, her husband, her children,
whether married or unmarried, her dependent parents and the dependent parents of her
husband and the widow and children of her predeceased son, if any. Family includes any
child lawfully adopted.

Wages means all emoluments which are paid or are payable in cash and includes dearness
allowance but DOES NOT include bonus, commission. house rent allowance, overtime
wages and any other allowance.

APPLICATION OF ACT
The Act applies to:

« Every factory, mine. oilfield, plantation, port and railway.

* Every shop or establishment in a State, in which 10 or more persons are employed. or were
employed. on any day of the preceding 12 months.
+ An establishment continues to be under this Act, even when number of employees falls
below 10.

CONTINUOUS SERVICE
An employee is said to be in continuous service for 1 year, if during the period of 12 calendar
months, he has worked for 190 days in a Mine or 240 days in other cases.
An employee is said to be in continuous service for 6 months, if during the period of 6
calendar months, he has worked for 95 days in a Mine or 120 days in other cases.

In case of seasonal establishment, the employee is said to be continuous service for any
period of 1 year or 6 months, if he has actually worked for not less than 75% of the number
of days.

An employee shall be said to be in continuous service in following cases of interruptions:

« Absence on account of sickness, accident, leave, absence from duty without leave, lay-off,
strike or a lock-out or cessation of work not due to any fault of the employee

« Leave with full wages

« Absence due to temporary disablement caused by accident in the course of his employment
* Maternity leave The provisions relating to "Continuous Service" (Section 2-A) was inserted
in the Payment of Gratuity Act, 1972 by an amendment in the year 1984.
PAYMENT OF GRATUITY

Gratuity shall be payable on termination of employment after Continuous service for at least
5 years:

(a) on his superannuation

(h) on his retirement or resignation, or

(c) on his death or disablement due to accident or disease: Completion of continuous service
of 5 years shall not be necessary where the termination of the employment of any employee is
due to death or disablement.
In the case of death of the employee. gratuity shall be paid to his nominee or heirs. If
nominees or heirs is a minor, the gratuity shall be deposited with the controlling authority,
who shall invest in such bank/financial institution, until the minor attains majority.

For every completed year of service or part thereof in excess of six months, the employer
shall pay gratuity to an employee at the rate of 15 days' wages based on the rate of wages last
drawn.
For piece-rated employee, daily wages shall be computed on the average of the total wages
received by him for a period of 3 months, excluding payment for any overtime work. For
monthly rated employee, the 15 days' wages shall be calculated by dividing the monthly rate
of wages last drawn by him by 26 and multiplying the quotient by 15. For an employee in a
seasonal establishment, the employer shall pay the gratuity at the rate of 7 days' wages for
each season.
The amount of gratuity payable to an employee shall not exceed Rs 20 Lakhs.
Gratuity may be shall forfeited to the extent of the damage/loss so caused, if services of
employee have been terminated for any act, wilful omission or negligence causing any
damage or loss to, or destruction of, property belonging to the employer.

COMPULSORY INSURANCE
Every employer, (other than establishments under Centre/State Government) shall obtain an
Insurance for his liability for payment towards the gratuity, from the [IC or any other
prescribed Insurer.

Employer is exempted from Insurance it

« he has already established an approved gratuity fund

« he is employing 500 or more persons The appropriate Government may, make rules for the
composition of the Board of Trustees of the approved gratuity fund.

Penalty for Compulsory Insurance- Failure to get Insurance/Gratuity Fund is punishable with
Fine up to Rs 10,000 and in case of continuing offence Rs 1000 for each day during which
the offence continues.

NOMINATION

Each employee, who has completed 1 year of service, shall make nomination. He may
distribute the amount of gratuity amongst more than one nominee.

If an employee has a family at the time of making a nomination, the nomination shall be
made in favour of one or more members of his family, and any nomination made outside his
family shall be void.

If employee has no family, the nomination may be made in favour of any person but if
employee subsequently acquires a family, such nomination shall forthwith become invalid
and the employee shall make a fresh nomination in favour of one or more members of his
family.

DETERMINATION OF THE AMOUNT OF GRATUITY

The employer shall pay the amount of gratuity within 30 days from the date it becomes
payable. If there is delay, the employer will pay simple interest at rate notified by the Central
Government from time to time for repayment of long-term deposits.

Where there is a dispute, the employer or employee may make an application to the
controlling authority. In this case, the employer shall deposit with the controlling authority
such amount as he admits to be payable as gratuity.

Any person aggrieved by an order of Controlling Authority may, within 60 days, prefer an
appeal to the appropriate Government. The appropriate Government may. confirm, modify,
or reverse the decision of the controlling authority.
INSPECTORS

The appropriate Government may, appoint as many Inspectors, as it deems fit, for the
purposes of this Act. Every Inspector shall be deemed to be a public servant.

RECOVERY OF GRATUITY

If Gratuity is not paid by the employer, the controlling authority shall, issue a certificate for
that amount to the Collector, who shall recover the same, together with compound interest.
The controlling authority shall, give the employer a reasonable opportunity of showing cause,
before issuing a certificate. The amount of interest payable can NOT exceed the amount of
gratuity.

PENALTIES
Anyone making false statement or false representation - Imprisonment up to 6 months, Fine
Rs 10,000 or both. Any employer who contravenes any of the provisions/rule of Act -
Imprisonment between 3-12 months (max can be up to 24 months in case of Offence relates
to non-payment of any gratuity) , Fine between Rs 10,000-Rs 20,000 or both.

EXEMPTION OF EMPLOYER FROM LIABILITY IN CERTAIN CASES

Where an employer is charged with an offence, but he believes that some other person
committed the offence without his knowledge, consent or connivance, he may bring other
person in front of court. For this he will have to give notice of 3 days to the complainant.

BUT if other person cannot be brought before the court. the court shall adjourn the hearing
from time to time for a period not exceeding 3 months. If the actual offender cannot still be
brought before the court, the court shall proceed to hear the charge against the employer and
convict the employer.
AMENDMENTS IN ACT IN 2010

As per 2010 Amendment, maximum amo'pnt of gratuity was increased to Rs 10 Lakhs from
Rs 3.5 Lakhs.

AMENDMENTS IN ACT IN 2018

The maximum maternity leave, for the purpose of calculatirrg "continuous service" under the
Act, is based on the maternity leave provided under the Maternity Benefit Act, 1961. The
maximum maternity leave under the 1961 Act was changed from 12 weeks to 26 weeks by
the Maternity Benefit (Amendment) Act, 2017. The Amendment removes the reference to 12
weeks in the 1972 Act and empowers the central government to notify the maximum
maternity leave (through executive order).
The Amendment Act has also increased the maximum limit of gratuity from Rs 10 Lakh to
Rs 20 Lakh.

Further, this Amendment allows the Union government to fix maternity benefit and gratuity
payment in future without amending the bill again and again. So, if at any time the
government wants to enhance these benefits, it can do so though executive orders without
going to the parliament.
 EMPLOYEES' PROVIDENT FUNDS ACT, 1952

The objective of this Act is to provide for the institution of provident funds, pension fund and
deposit-linked insurance fund, for employees in factories and other establishments.

DEFINITIONS

Appropriate Government is "Central Government" for establishments which are:

* Under the control of, the Central Government

« having branches in more than one State

* a major port, mine, oilficld or railway company For all other establishments, "State
Government" is appropriate government.
Authorised officer means the Central Provident Fund Commissioner, Additional—Central
Provident Fund Commissioner, Deputy Provident Fund Commissioner, Regional Provident
Fund Commissioner or such other officer as may be authorised by the Central Government,

Basic wages means all emoluments while being on duty or on leave or on holidays with
wages and which are payable in cash, but DOES NOT include:

(i) value of any food concession;

(if) any dearness allowance, house-rent allowance, overtime allowance, bonus commission

(iii) any presents made by the employer;

Controlled industry means any industry the control of which by the Union has been declared
by a Central Act to be expedient in the public interest.
Factory means any premises, in any part of which a manufacturing process\is being carried,
whether with the aid of power or without the aid of power.

Insurance Fund means the Deposit-linked Insurance Fund and Insurance Scheme means the
Employees' Deposit-linked Insurance Scheme.
Occupier of a factory means the person who has ultimate control over the affairs of the
factory, and, where the said affairs are entrusted to a managing agent, such agent shall be the
occupier of the factory.

Recovery Officer means any officer of the Central Government, State Government or the
Board of Trustees, who is authorised by the Central Government with powers of a Recovery
Officer under this Act.

Exempted employee means an employee exempted from a Scheme or the Insurance Scheme
under this Act. Similarly,
Exempted establishment means an establishment, which has been exempted from provisions
of this Act. Superannuation, is for member of the Pension Scheme when he attains age of 58
years.
Tribunal means the Employees' Provident Funds Appellate Tribunal.

APPLICABLITY OF ACT

The Act is applicable to every establishment specified in Schedule I, where 20 or more

persons are employed. Central Government may, with not less than 2 months notice, apply
the provisions of this Act to establishments with less than 20 persons.

An establishment, which comes under this Act, shall continue to be governed by this Act,
even if number of persons employed falls below 20.

This Act shall not apply to: * any establishment registered under the Co-operative Societies
Act, 1912 employing less than 50 persons and working without the aid of power; or + any
other establishment belonging to or under the control of the Central Government or a State
Government and whose employees are entitled to the benefit of contributory provident fund
or old age pension in accordance with any scheme.

EMPLOYEES' PROVIDENT FUND SCHEMES

The Central Government may frame a Scheme to be called the Employees' Provident Fund
Scheme for the establishment of provident funds. The Fund shall be administered by the
Central Board.

CENTRAL BOARD

The Central Government may, constitute a Board of Trustees (called Central Board)
consisting of

* A Chairman and a Vice-Chairman to be appointed by the Central Government;

« Central Provident Fund Commissioner, ex officio;

= Not more than 5 persons appointed by the Central Government from amongst its officials;

« Not more than 15 persons representing Governments of States

« 10 persons representing employers of the establishments to which the Scheme applies

« 10 representing employees in the establishments to which the Scheme applies

The Central Board shall administer the Fund as may be specified in the Scheme. The
accounts of the Central Board shall be audited annually by the Comptroller and Auditor
General of India.

It shall be the duty of the Central Board to submit to the Central Government an annual report
of its work and activities, audited accounts together with the report of the Comptroller and
Auditor-General of India and the comments of the Central Board thereon to be laid before
each House of Parliament.

EXECUTIVE COMMITTEE
The Central Government may constitute, an Executive Committee to assist the Central Board:

« a Chairman appointed from amongst the members of the Central Board:

« 2 persons appointed by the Central Government from Centre (From pool of Central Board)

* 2 persons appointed by the Central Government from States (From pool of Central Board)

* 3 persons representing the employers elected by the Central Board (From pool of Central
Board)
* 3 persons representing the employees elected by the Central Board (From pool of Central
Board)

« Central Provident Fund Commissioner, ex officio.

STATE BOARD

The Central Government may, a Board of Trustees (referred to as the State Board) for any
State after consultations with that state.

APPOINTMENT OF OFFICERS
The Central Government shall appoint a "Central Provident Fund Commissioner" who shall
be the chief executive officer, CEO of the Central Board. The Central Government may also
appoint a Financial Adviser and Chief Accounts Officers to assist the Central Provident Fund
Commissioner.

The Central Board may appoint as many Additional Central Provident Fund Commissioners,
Deputy Provident Fund Commissioners, Regional Provident Fund Commissioners, Assistant
Provident Fund Commissioners.
All appointments, equivalent pay scale of any Group A or Group B posts, shall be made only
after consultation with Union Public Service Commission, UPSC. No consultations of UPSC
are required for « if appointment is for a period not exceeding 1 year « if person to be
appointed is a member of the Indian Administrative Service ¢ if person to be appointed is in
the service of the Central Government or a State Government or the Central Board in a Group
"A’ or Group 13' post.

The method of recruitment, salary and allowances, discipline and other conditions of service
of a State Board shall be with the approval of the State Government concerned.
CONTRIBUTIONS WHICH MAY BE PROVIDED FOR IN SCHEMES

The employer contribution will be 10% of the basic wages, dearness allowance and retaining
allowance and the employees, contribution shall be equal to the contribution payable by the
employer Any employee may contribute exceeding 10% but the employer shall not be under
an obligation to pay any contribution over and above 10%. This contribution can be increased
to 12% by Central Government for class of establishments

Here, dearness allowance shall include cash value of any food concession. Here retaining
allowance means an allowance paid to employee for retaining his services.

EMPLOYEES' PENSION SCHEME

The Central Government may frame a scheme called the Employees' Pension Scheme for:

(a) superannuation pension, retiring pension or permanent total disablement pension

(b) widow or widower's pension, children pension or orphan pension

Employer will contribute up to 8.33% of hasic wages, dearness allowance and retaining
allowance, if any. On the establishment of the Pension Fund, the Family Pension Scheme
shall cease to operate. Just like other schemes, the Pension Fund shall be administered by the
Central Board
EMPLOYEES' DEPOSIT LINKED INSURANCE SCHEME
The Central Government may, frame a scheme to be called the Employees' Deposit-linked
Insurance Scheme for the purpose of providing life insurance benefits to the employees of
any establishment. A Deposit-linked Insurance Fund will be established, after the framing of
the Insurance Scheme. The employer will contribute, not being more than 1% of the
aggregate of the basic wages, dearness allowance and retaining allowance. The employer
shall also pay not exceeding 0.25% of contribution into the Insurance Fund to meet all the
expenses of the administration of the Insurance Scheme.

The Insurance Fund shall vest in the Central Board and be administered as specified in
Insurance Scheme.

LAYING OF SCHEMES BEFORE PARLIAMENT

Every scheme framed under this Act, shall be laid before each House of Parliament, for
period of 30 days which may be comprised in one or more successive sessions, for purpose of
framing and modifications.

DETERMINATION OF MONEYS DUE FROM EMPLOYERS

The officers (Central Provident Fund Commissioner, Additional Central Provident Fund
Commissioner, Deputy Provident Fund Commissioner, Regional Provident Fund
Commissioner, Assistant Provident Fund Commissioner) may:
(a) decide in case of disputes regarding the applicability of this Act to an establishment

(b) determine the amount due from any employer under any provision of this Act. Where an
order is passed against an employer "ex parte”, he may, within 3 months from such order,
apply to the officer for setting aside such order and if he satisfies, the officer shall make an
order setting aside his earlier order and shall appoint a date for proceeding with the inquiry.

Any person aggrieved by an order, may apply for a review of that order to the officer who
passed the order. Where the officer is of opinion that the review should be granted, he shall
grant the same. No appeal shall lie against the order of the officer rejecting an application for
review, but an appeal shall lie against an order passed under review as if the order passed
under review were original order by him.

DETERMINATION OF ESCAPED AMOUNT

The officers have powers to re-open the case and pass appropriate orders within 5 years, if
they believe that any amount so due from such employer for any period has escaped his
notice.

TRIBUNAL

The Industrial Tribunal constituted by the Central Government under section 7A of the
Industrial Disputes Act, 1947 shall., be the Tribunal for the purposes of this Act.

Earlier there was provision of Employees' Provident Funds Appellate Tribunal, EPFAT under
this Act. But w.e.f. 26 May 2017, the jurisdiction, power and authority of EPFAT has been
transferred to the Central Government Industrial Tribunal, CGIT. It was passed in parliament
through Finance Act, 2017.

APPEALS TO TRIBUNAL
Any person aggrieved by order issued by Central Government or any authority, may appeal
to a Tribunal. « A Tribunal may, at any time within 5 years from the date of its order, modify
its order. * Any order made by a Tribunal finally for an appeal shall not be questioned in any
court of law. « No appeal by the employer shall be entertained by a Tribunal unless he has
deposited with it 75% of the amount due from him. « The employer shall be liable to pay
simple interest at the rate of 12% per annum.

ISSUE OF CERTIFICATE TO THE RECOVERY OFFICER

Where any amount is in arrear, the authorised officer may issue, to the Recovery Officer, a
certificate specifying the amount of arrears. Then Recovery Officer, shall recover the amount
from the employer by

(a) attachment and sale of the movable or immovable property.

(b) arrest of the employer and his detention in prison;

(c) appointing a receiver for the management of the movable/immovable properties.

INSPECTORS
The appropriate Government may, Inspectors for the purposes of this Act.

PENALTIES.
Anyone making false statement/representation - Imprisonment up to 1 year or Fine of Rs
5000 or hoth.

Employer who contravenes, or makes default in complying with Contribution payments,

payment of inspection charges or payment of administrative charges - Imprisonment up to 3
years but not be less than 1 year and Fine Rs 10,000.

In case of default in payment of the employees' contribution which has been deducted by the
employer from the employees’ wages - Imprisonment not be less than 6 months and Fine Rs
5000.

Whoever, having been convicted by a Court of an offence punishable under this Act, commits
the same offence shall be subject for every such subsequent offence to Imprisonment up to 5
years, but which shall not be less than 2 years, and Fine of Rs 25000.

LIST OF SCHEDULES

Schedule I : List of Industries , where PF scheme will apply.

Schedule II: List of matters for which provisions may be made for a Provident Fund scheme.

Schedule III : List of matters for which provisions may be made for a Pension scheme.
Schedule IV : List of matters for which provisions may be made for an Insurance scheme.
AMENDMENTS IN THE ACT IN 2014

The Central Government has amended the ceiling for contributions under the Employees'
Provident Fund and Miscellaneous Provisions Act, 1952 (EPF Act) from Rs 6,500 to Rs
15,000, with effect from 1 September 2014. Further in a 2017 notification: The payment may
be made to the person, to whom payment is to be made, through "electronic or digital funds
transfer' system of any Scheduled commercial bank or any post office."

A proposal for comprehensive amendment to the Employees' Provident Funds and

Miscellaneous Provisions (EPF & MP) Act, 1952 is under consideration of the Government
which, inter alia, includes reducing threshold limit for coverage from 20 to 10 employees
under the Act.

Administration cost of the Employees' Provident Fund The administration cost of the
Employees' Provident Fund (EPF) and Employees' Deposit Linked Insurance Scheme
(EDLI), 1976, is met from the administrative and inspection charges collected from the
employers of un-exempted and exempted establishments. No charges however are levied to
run Employees' Pension Scheme (EPS), 1995.
The Central Government in consultation with the Central Board of Trustees, EPF fixes the
administrative charges from time to time. The administrative charges were last reduced from
1.10% to 0.85% with effect from 1st January, 2015. Considering the need to promote the
"Ease of Doing Business in India" and to make Indian business more competitive, and in
response to the financial efficiency gained by EPFO, the Central Board decided (in March
2017) to recommend further reduction of administrative charges to 0.65 %. It also
recommended to abolish administrative charges levied in implementing the EDLI Scheme,
1976 passing on the benefits of efficiency and computerisation to employers.
As on date, the employee contributes 12% of the basic pay to EPF, the employer contributes
8.33% towards employees' pension scheme and 3.67% to the EPF itself Additionally,
employers also pay 0.5% towards Employees' Deposit-linked Insurance scheme, 0.65% as
EPF administrative charges and 0.01% as EDLI handling fee, taking the total contribution to
13.16%.

Pradhan Mantri Rojgar Protsahan Yojana (PMRPY) Government of India is implementing

the Pradhan Mantri Rojgar Protsahan Yojanaa (PMRPY) to incentivize employers for new
employment. The scheme launched on 9th August 2016 provides that Government of India
will pay the Employees Pension Scheme (EPS) contribution of 8.33% for all new employees
enrolling ire EPFO for the first 3 years of their employment. The scheme is applicable to
those having earnings Rs. 15,000/~ per month. For the textile (garmenting) sector,
Government of India is paying the complete 12% employers” contribution (8.33% EPS
+3.67% EPF) for these new employees.
The business must be registered with the EPFO and must have a Labour Identification
Number (LIN) that one can acquire under the Shram Suvidha Portal. Under the PMPRY
scheme, the Labour Identification Number will serve as the primary reference number for all
official communication.
 THE EMPLOYEES' STATE INSURANCE ACT,1948

DEFINITIONS:

Appropriate Government-In respect of establishments under the control of the Central Government
or a railway administration or a major port or a mine or oilfield, the Central Government, and in all
other cases, the State Government.

Corporation-The Employees State Insurance Corporation set up under this Act.

Dependant-Any of the following relatives of a deceased insured person, namely:-

(i) A widow, a legitimate or adopted son who has not attained the age of twenty-five years. an
unmarried legitimate or adopted daughter.
(ia) a widowed, mother
(ii) if wholly dependent on the earnings of the insured person at the time of his death, a legitimate
or adopted son or daughter who has attained the age of twenty-five years and is infirm;
(iii) if wholly or in part dependent on the earnings of the insured person at the time of his death.-
(a) a parent other than a widowed mother,
(b) a minor illegitimate son, an unmarried illegitimate daughter or a daughter legitimate or
adopted or illegitimate if married and a minor or if widowed and a minor,
(c) a minor brother or an unmarried sister or a widowed sister 1f a minor,
(d) a widowed daughter-in-law,
() a minor child of a pre-deceased son,
(f) a minor child of a pre-deceased daughter where no parent of the child is alive, or
(g) a paternal grand-parentif no parent of the insured personis alive

Employee-Any person employed for wages in or in connection with the work of a factory or
establishment to which this Act applies and-

(i) who is directly employed by the principal employer on any work of, or incidental or preliminary to
or connected with the work of, the factory or establishment, whether such work is done by the
employee in the factory or establishment or elsewhere: or
(ii) who is employed by or through an immediate employer on the premises of the factory or
establishment or under the supervision of the principal employer or his agent on work which is
ordinarily part of the work of the factory or establishment or which is preliminary to the work carried
oninorincidental to the purpose of the factory or establishment; or
(iii) whose services are temporarily lent or let on hire to the principal employer by the person with
whom the person whose services are so lent or leton hire has entered into a contract of service.

Exempted Employee-An employee who is not liable under this Act to pay the employees
contribution.
Family-All orany of the following relatives of an insured person, namely:-
(i)aspouse;
(i) aminor legitimate or adopted child dependent upon the insured person;
(iii)a child who is wholly dependent on the earnings of the insured person and who is-
(a) receiving education, till he or she attains the age of twenty-one years,
(b) anunmarried daughter;
(iv) a child who is infirm by reason of any physical or mental abnormality or injury and is wholly
dependent on the earnings of the insured person, so long as the infirmity continues;
(v) dependant parents, whose income from all sources does not exceed such income as may be
prescribed by the Central Government;
(vi)in case the insured person is unmarried and his or her parents are notalive, a minor brother or sister
wholly dependant upon the earnings of the insured person:

Insurable employment-An employment ina factory or establishment to which this Actapplies.

Insured person-A person who is or was an employee in respect of whom contributions are or were
payable under this Actand who is by reason thereof, entitled to any of the benefits provided by this Act.

Managing Agent-Any person appointed or acting as the representative of another person for the
purpose of carrying on such other person's trade or business, but does not include an individual
manager subordinate to an employer.

Mis-Carriage-Expulsion of the contents of a pregnant uterus at any period prior to or during the
twenty-sixth week of pregnancy but does not include any miscarriage, the causing of which is
punishable under the Indian Penal Code (45 of 1860).

Permanent Total Disablement-Such disablement of a permanent nature as incapacitates an

employee for all work which he was capable of performing at the time of the accident resulting in such
disablement.

Sickness-A condition which requires medical treatment and attendance and necessitates abstention
from work on medical grounds.

Temporary Disablement-A condition resulting from an employment injury which requires medical
treatment and renders an employee, as a result of such injury, temporarily incapable of 24doing the
work which he was doing priorto orat the time of the injury.
ESTABLISHMENT OF EMPLOYEES' STATE INSURANCE CORPORATION:

(1) With effect from such date as the Central Government may, by notification in the Official Gazette,
appoint in this behalf, there shall be established for the administration of the scheme of Employees'
State Insurance in accordance with the provisions of this Act a Corporation to be known as the
Employees' State Insurance Corporation.

(2) The Corporation shall be a body corporate by the name of Employees' State Insurance Corporation
having perpetual succession and a common seal and shall by the said name sue and be sued.

CONSTITUTION OF CORPORATION:

The Corporation shall consist of the following members, namely:--

(a) a Chairman to be appointed] by the Central Government;

(b) a Vice-Chairman to be 2[appointed] by the Central Government;
(¢) not more than five persons to be appointed] by the Central Government;
(d) one person each representing each of the States in which this Act is in force to be appointed by
the State Government concerned:
() one person to be appointed by the Central Government to represent the union territories;
(f) ten persons representing employers to be appointed by the Central Government in consultation
with such organisations of employers as may be recognised for the purpose by the Central
Government;
(g) ten persons representing employees to be appointed by the Central Government in consultation
with such organisations of employees as may be recognised for the purpose by the Central
Government;
(h) two persons representing the medical profession to be appointed by the Central Government in
consultation with such organisations of medical practitioners as may be recognised for the purpose
by the Central Government;
(i) three members of Parliament of whom two shall be members of the House of the People
(LokSabha) and one shall be a member of the Council of States (RajyaSabha) elected respectively
by the members of the House of the People and the members of the Council of States; and
(j) the Director General of the Corporation, ex officio.

CONSTITUTION OF STANDING COMMITTEE:

A Standing Committee of the Corporation shall be constituted from among its members, consisting
of—(a) a Chairman, appointed by the Central Government;
(b) three members of theCorporation, appointed by the Central Government;
(bb) three members of the Corporation representing such three State Governments thereon as the
Central Government may, by notification in the Official Gazette, specify from time to time;
(c) eight members elected by the Corporation as follows:--
(i) three members from among the members of the Corporation representing employers:
(ii) three members from among the members of the Corporation representing employees;
(iii) one member from among the members of the Corporation representing the medical
profession; and
(iv) one member from among the members of the Corporation elected by Parliament;
(d) the Director General of the Corporation, ex officio.
SICKNESS BENEFIT:

The qualification of a person to claim sickness benefit, the conditions subject to which such benefit
may be given, the rates and period thereof shall be such as may be prescribed by the Central
Government.

MATERNITY BENEFIT:

The qualification of an insured woman to claim maternity benefit, the conditions subject to which such
benefit may be given, the rates and period thereof shall be such as may be prescribed by the Central
Government.

DISABLEMENT BENEFIT:

(a) a person who sustains temporary disablement for not less than three days excluding the day of
accident shall be entitled to periodical payment at such rates and for such periods and subject to such
conditions as may be prescribed by the Central Government.

(b) a person who sustains permanent disablement, whether total of partial, shall be entitled to
periodical payment at such rates and for such period and subject to such conditions as may be
prescribed by the Central Government.

DEPENDANT'S BENEFIT:

(1) If an insured person dies as a result of an employment injury sustained as an employee under this
Act (whether or not he was in receipt of any periodical payment for temporary disablement in respect
of the injury) dependants benefit shall be payable at such rates and for such periods and subject to such
conditions as may be prescribed by the Central Government to his dependants specified in sub-clause
(i), sub-clause (ia) and] sub-clause (ii) of clause (6A) of section 2.
(2) In case the insured person dies without leaving behind him the dependants as aforesaid, the
dependants benefit shall be paid to the other dependants of the deceased at such rates and for such
period and subject to such conditions as may be prescribed by the Central Government.

INSTITUTION OF PROCEEDINGS:

(1) Subject to the provisions of this Act and any rules made by the State Government, all proceedings
before the Employees' Insurance Court shall be instituted in the Court appointed for the local area in
which the insured person was working at the time the question or dispute arose.
(2) If the Court is satisfied that any matter arising out of any proceeding pending before it can be more
conveniently dealt with by any other Employees' Insurance Court in the same State, it may, subject to
any rules made by the State Government in this behalf, order such matter to be transferred to such
other Court for disposal and shall forthwith transmit to such other Court the records connected with
that matter.
(3) The State Government may transfer any matter pending before any Employees' Insurance Court in
the State to any such Courtin another State with the consent of the State Government of that State.
(4) The Court to which any matter is transferred under sub-section (2) or sub-section (3) shall continue
the proceedings as if they had been originally instituted in it
OFFENCES BY COMPANIES:

1) If the person committing an offence under this Act is a company, every person, who at the time the
offence was committed was in charge of, and was responsible to, the company for the conduct of the
business of the company, as well as the company, shall be deemed to be guilty of the offence and shall
be liable to be proceeded against and punished accordingly:

Provided that nothing contained in this sub-section shall render any person liable to any punishment, if
he proves that the offence was committed without his knowledge or that he exercised all due diligence
to prevent the commission of such offence.

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been
committed with the consent or connivance of, or is attributable to, any neglect on the part of, any
director or manager, secretary or other officer of the company, such director, manager, secretary or
other officer shall be deemed to be guilty of that offence and shall be liable to be proceeded against and
punished accordingly.

PUNISHMENT FOR FALSE STATEMENT:

Whoever, for the purpose of causing any increase in payment or benefit under this Act, or for the
purpose of causing any payment or benefit to be made where no payment or benefit is authorised by or
under this Act, or for the purpose of avoiding any payment to be made by himself under this Act or
enabling any other person to avoid any such payment, knowingly makes or causes to be made any false
statement or false representation, shall be punishable with imprisonment for a term which may extend
to six months or with fine not exceeding two thousand rupees, or with both:

Provided that where an insured person is convicted under this section, he shall not be entitled for any
cash benefitunder this Act for such period as may be prescribed by the Central Government.
 THE MATERNITY BENEFITACT,1961

DEFINITIONS:

Appropriate Government- Inrelation to an establishment being a mine,or an establishment wherein

persons are employed for the exhibition of equestrian, acrobatic and other performances, the Central
Governmentand in relation to any other establishment, the State Government.
Child-Includes a still-born child.
Commissioning Mother-A biological mother who uses her egg to create an embryo implanted in any
other woman.
Delivery-The birth ofachild.
Employer- (i) In relation to an establishment which is under the control of the Government, a person
or authority appointed by the Government for the supervision and control of employees or where no
person or authority is so appointed, the head of the department.
(i1) In relation to an establishment under any local authority, the person appointed by such authority
for the supervision and control of employees or where no person is so appointed, the chief executive
officer of the local authority.
(iii) In any other case, the person who, or the authority which, has the ultimate control over the affairs
of the establishment and where the said affairs are entrusted to any other person whether called a
manager, managing director, managing agent, or by any other name, such person.
Inspector-An Inspector appointed under section 14.
Maternity Benefit- The payment referred to in sub-section (1) of section 5.
Medical Termination of pregnancy-The termination of pregnancy permissible under the provisions
of Medical Termination of Pregnancy Act, 1971 (34 0f 1971).
Miscarriage- Expulsion of the contents of a pregnant uterus at any period prior to or during the
twenty-sixth week of pregnancy but does not include any miscarriage, the causing of which is
punishable under the Indian Penal Code (45 of 1860).
Woman- A woman employed, whether directly or through any agency, for wages in any
establishment.

RIGHT TO PAYMENT OF MATERNITY BENEFIT:

(1) Subject to the provisions of this Act, every woman shall be entitled to, and her employer shall be
liable for, the payment of maternity benefit at the rate of the average daily wage for the period of her
actual absence, that is to say, the period immediately preceding the day of her delivery, the actual day
of her delivery and any period immediately following thatday.

(2) No woman shall be entitled to maternity benefit unless she has actually worked in an establishment
of the employer from whom she claims maternity benefit, for a period of not less than eighty days in
the twelve months immediately preceding the date of her expected delivery:

(3) A woman who legally adopts a child below the age of three months or a commissioning mother
shall be entitled to maternity benefit for a period of twelve weeks from the date the child is handed over
to the adopting motheror the commissioning mother, as the case may be.

(4) In case where the nature of work assigned to a woman is of such nature that she may work from
home, the employer may allow her to do so after availing of the maternity benefit for such period and
on such conditions as the employer and the woman may mutually agree.
CONTINUANCE OF PAYMENT OF MATERNITY BENEFITIN CERTAIN:

Every woman entitled to the payment of maternity benefit under this Act shall, notwithstanding the
application of the Employees' State Insurance Act, 1948 (34 of 1948), to the factory or other
establishment in which she is employed, continue to be so entitled until she becomes qualified to claim
maternity benefit under section 50 of that Act.

PAYMENT OF MEDICAL BONUS:

(1) Every woman entitled to maternity benefit under this Act shall also be entitled to receive from her
employer a medical bonus of one thousand rupees, if no pre-natal confinement and post-natal care is
provided for by the employer free of charge.

(2) The Central Government may before every three years, by notification in the Official Gazette,
increase the amount of medical bonus subject to the maximum of twenty thousand rupees.

NURSING BREAKS:

Every woman delivered of a child who returns to duty after such delivery shall, in addition to the
interval for rest allowed to her, be allowed in the course of her daily work two breaks of the prescribed
duration for nursing the child until the child attains the age of fifteen months.

CRECHEFACILITY:

(1) Every establishment having fifty or more employees shall have the facility of créche within
such distance as may be prescribed, either separately or along with common facilities:

Provided that the employer shall allow four visits a day to the creche by the woman, which shall
also include the interval for rest allowed to her.

(2) Every establishment shall intimate in writing and electronically to every woman at the time of her
initial appointment regarding every benefit available under the Act.

APPOINTMENT
OF INSPECTORS:

The appropriate Government may, by notification in the Official Gazette, appoint such officers as it
thinks fit to be Inspectors for the purposes of this Actand may define the local limits of the jurisdiction
within which they shall exercise their functions under this Act.

PENALTY FOR OBSTRUCTING INSPECTOR:

Whoever fails to produce on demand by the Inspector any register or document in his custody kept in
pursuance of this Act or the rules made thereunder or conceals or prevents any person from appearing
before or being examined by an Inspector shall be punishable with imprisonment I [which may extend
to one year, or with fine which may extend to five thousand rupees, or with both.
PENALTY FOR CONTRAVENTION OF ACT BY EMPLOYER:

(1) Ifany employer fails to pay any amount of maternity benefit to a woman entitled under this Act or
discharges or dismisses such woman during or on account of her absence from work in accordance
with the provisions of this Act, he shall be punishable with imprisonment which shall not be less than
three months but which may extend to one year and with fine which shall not be less than two thousand
rupees but which may extend to five thousand rupees:

Provided that the court may, for sufficient reasons to be recorded in writing, impose a sentence of
imprisonment for a lesser term or fine only in lieu of imprisonment.

(2) Ifany employer contravenes the provisions of this Act or the rules made thereunder, he shall, if no
other penalty is elsewhere provided by or under this Act for such contravention, be punishable with
imprisonment which may extend to one year, or with fine which may extend to five thousand rupees, or
with both:

Provided that where the contravention is of any provision regarding maternity benefit or regarding
payment of any other amount and such maternity benefit or amount has not already been recovered,
the court shall, in addition, recover such maternity benefit or amount as if it were a fine and pay the
same to the person entitled thereto.
 THE EMPLOYEE'S COMPENSATION ACT.1923

DEFINITIONS :

Commissioner-A Commissioner for Workmen's Compensation appointed under section 20

Compensation- compensation as provided for by this Act
Dependant-Any of the following relatives of'a deceased employee, namely:--

(1) a widow, a minor legitimate or adopted son, and unmarried legitimate or adopted daughter, or a
widowed mother; and
(ii) if wholly dependent on the earnings of the employee at the time of his death, a son or a daughter
who has attained the age of 18 years and who is infirm;
(iii) if wholly or in part dependent on the earnings of the employee at the time of his death,
(a)awidower,
(b) a parent other than a widowed mother,
(c) a minor illegitimate son, an unmarried illegitimate daughter or a daughter legitimate or
illegitimate or adopted if married and a minor or if widowed and a minor,
(d)aminor brotheror a unmarried sister ora widowed sister if a minor,
(e)awidowed daughter-in-law,
(f)aminor child ofa pre-deceased son,
(g)aminor child of a pre-deceased daughter where no parent of the child is alive, or
(h) a paternal grandparent ifno parent of the employeeisalive.

AMOUNT OF COMPENSATION:

Subject to the provisions of this Act, the amount

of compensation shall be as follows, namely

(a) where death results from the injury an amount equal to fifty per cent of the monthly wages of the
deceased employee multiplied by the relevant factor; or an amount of one lakh and twenty thousand
rupees, whicheveris more.

(b) where permanent total disablement results from the injury an amount equal to sixty per cent of the
monthly wages of the injured employee multiplied by the relevant factor; or an amount of one lakh and
forty thousand rupees whichever is more.

(¢) Where permanent partial disablement results from the injury.

(i) in the case of an injury specified in Part II of Schedule I, such percentage of the compensation
which would have been payable in the case of permanent total disablement as is specified therein
as being the percentage of the loss of earning capacity caused by thatinjury, and
(ii) in the case of an injury not specified in Schedule I, such percentage of the compensation
payable in the case of permanent total disablement as is proportionate to the loss of earning
capacity as assessed by the qualified medical practitioner permanently caused by the injury.

(d) Where temporary disablement, whether total or partial results from the injury a half-monthly
payment of the sum equivalent to twenty-five per cent of monthly wages of the employee, to be paid in
accordance with the provisions of sub-section (2).
PENALTIES:

(a) fails to maintain a notice-book which he is required to maintain under sub-section (3) of section 10,
or
(b) fails to send to the Commissioner a statement which he is required to sent under sub-section (1) of
section 10A, or
(¢) fails to send a report which he is required to sent under section 10B, or
(d) fails to make a return which he is required to make under section 16, or
(e) fails to inform the employee of his rights to compensation as required under section 17A;
shall be punishable with fine which shall not be less than fifty thousand rupees but which may extend
to one lakh rupees.

REFERENCETO COMMISSIONERS:

(1) If any question arises in any proceedings under this Act as to the liability of any person to pay
compensation (including any question as to whether a person injured is or is not aemployee or as to the
amount or duration of compensation including any question as to the nature or extent of disablement,
the question shall, in default ofagreement, be settled by a Commissioner.

(2) No Civil Court shall have jurisdiction to settle, decide or deal with any question which is by or
under this Act required to be settled, decided or dealt with by a Commissioner or to enforce any
liability incurred under this Act.

APPOINTMENT OF COMMISSIONERS:

(1) The State Government may, by notification in the Official Gazette,who is or has been a member of
a State Judicial Service for a period of not less than five years or is or has been for not less than five
years an advocate or a pleader or is or has been a Gazetted Officer for not less than five years having
education qualifications and experience in personnel management, human resource development and
industrial relations appoint any person to be a Commissioner for Workmen's Compensation.

(2) Where more than one Commissioner had been appointed for any area, the State Government may,
by general or special order, regulate the distribution of business between them.

(3) Any Commissioner may, for the purpose of deciding any matter referred to him for decision under
this Act, choose one or more persons possessing special knowledge of any matter relevant to the
matter under inquiry to assisthimin holding the inquiry.

(4) Every Commissioner shall be deemed to be a public servant within the meaning of the Indian Penal
Code (45 of 1860).
METHOD OF RECORDING EVIDENCE:

The Commissioner shall make a brief memorandum of the substance of the evidence of every witness
as the examination of the witness proceeds, and such memorandum shall be written and signed by the
Commissioner with his own hand and shall form part of the record.

Provided that, if the Commissioner is prevented from making such memorandum, he shall record
the reason of his inability to do so and shall cause such memorandum to be made in writing from
his dictation and shall sign the same, and such memorandum shall form part of the record.

Provided further that the evidence of any medical witness shall be taken down as nearly as may be
word for word.

RECOVERY:

The Commissioner may recover is an arrear of land-revenue any amount payable by any person under
this Act, whether under an agreement for the payment of compensation or otherwise, and the
Commissioner shall be deemed to be a public officer within the meaning of section 5 of the Revenue
Recovery Act, 1890 (1 of 1890).
 INDUSTRIAL EMPLOYMENT (STANDING ORDERS) ACT, 1946

The main objectives of the Act, besides maintaining harmonious relationship between
the employers and the employees, are to regulate the conditions of recruitment, discharge,
disciplinary action, leave, holidays, etc. of the workers employed in industrial establishments.
The Act amended in 1982 also provides for payment of subsistence allowance to the
workmen who are kept under suspension pending domestic enquiry.

DEFINITIONS

Appellate authority means an authority appointed by the appropriate Government in relation

to an appeal pending before an Industrial Court or other authority.

Appropriate Government is "Central Government" for establishments which are: Under the
control of, the Central Government

+ a major port, mine, oilfield or railway company For all other establishments, "State
Government” is appropriate government. Certifying Officer means a Labour Commissioner
or a Regional Labour Commissioner Industrial establishment means

(a) an industrial establishment defined in Payment of Wages Act, 1936,

(b) a factory as defined in Factories Act, 1948

(c) a railway

(d) establishment which employs workmen Standing orders means rules relating to matters
set out in the Schedule. Wages and Workman have same meanings as in Industrial Disputes
Act, 1947

APPLICABILITY OF THIS ACT

It applies to every industrial establishment where 100 or more are employed, or were
employed on any day of the preceding 12 months. The appropriate Government may, apply
the provisions of this Act to any industrial establishment less than 100, after giving notice of
2 months..

SUBMISSION OF DRAFT STANDING ORDERS

Within 6 months from the date on which this. Act becomes applicable to an industrial
establishment, the employer shall submit 5 copies of the draft standing orders proposed by
him, to the Certifying Officer.

CERTIFICATION OF STANDING ORDERS

Once received from employer, the Certifying Officer shall forward a copy to the trade union,
to seek objections, if any. Trade Union/Workmen may submit objections/suggestions within
15 days. After giving the employer and the trade union an opportunity of being heard, the
Certifying Officer shall certify the draft standing orders and shall within 7 days, send copies
of to the employer and to the trade union.
TEMPORARY APPLICATION OF MODEL STANDING ORDERS

For the period during which the Act is applicable. but standing orders are yet to be certified,
the prescribed "model standing orders" shall be deemed to be adopted in that establishment.

APPEALS
Any employer., workmen, trade union aggrieved by the order of the Certifying Officer, can
appeal to the Appellate Authority but within 30 days of receiving orders.
The appellate authority shall, within 7 days of its order, send copies to the Certifying
Authority, the Employer and the trade union/workmen.
DATE OF OPERATION OF STANDING ORDERS

Standing orders shall, unless an appeal is preferred, come into operation on the expiry of 30
days from date on which authenticated copies are sent. In case of appeal, on the expiry of 7
days from the date on which copies of the order of the appellate authority are sent, standing
orders will come into operation.
POSTING OF STANDING ORDERS

The text of the standing orders shall be prominently posted by the employer in English and in
local language on special boards or near the entrance through which the majority of the
workmen enter the industrial establishment and in all departments thereof where the
workmen are employed.

DURATION AND MODIFICATION OF STANDING ORDERS

Standing orders will not be liable to modification until the expiry of 6 months from the date
on which the standing orders came in to operation. An employer or workman or a trade union
may apply to the Certifying Officer for modification of standing orders, v1/4 ith 5 copies of
proposed modifications.
PAYMENT OF SUBSISTENCE ALLOWANCE
Where any workman is suspended by the employer pending investigation or inquiry, the
employer shall pay subsistence allowance: « at the rate of 50% of the wages, for the first 90
days of suspension. * at the rate of 75% of such wages, for the remaining period of
suspension. If any dispute arises regarding the subsistence allowance, the workman or the
employer may refer the dispute to the "Labour Court", under the Industrial Disputes Act,
1947.
POWERS OF AUTHORITIES
Every Certifying Officer and appellate authority shall have all the powers of a Civil Court.
No oral evidence having the effect of adding/varying/ contradicting standing orders finally
certified under this Act shall be admitted in any Court.

PENALTIES AND PROCEDURE

An employer who fails to submit draft standing orders- Fine Rs 5000 and in the case of a
continuing offence further fine up to Rs 200 for every day. An employer who does any act in
contravention of the standing orders- Fine up to Rs 100 and in the case of a continuing
offence further fine up to Rs 25 for every day.

INTERPRETATION OF STANDING ORDERS

If any question arises to the application or interpretation of a standing order certified under
this Act, any employer or workman or trade union may refer to Labour Courts under the
Industrial Disputes Act, 1947.

SCHEDULES Matters to be provided in standing orders under this act

1. Classification of workmen (there are 7 classifications as on Jan 2019), e.g., whether

permanent. temporary, apprentices, casual, probationers, badlis, fixed term employment
workmen.

2. Manner of intimating to workmen periods and hours of work, holidays, pay-days and wage
rates.
3. Shift working.

4. Attendance and late coming.

5. Conditions of, procedure in applying for, and the authority which may grant leave and
holidays.

6. Requirement to enter premises by certain gates, and liability to search.

7. Closing and reporting of sections of the industrial establishment, temporary stoppages of

work and the rights and liabilities of the employer and workmen arising there from.

8. Termination of employment, and the notice thereof to be given by employer and workmen.

9. Suspension or dismissal for misconduct, and acts or omissions which constitute

misconduct.

10. Means of redress for workmen against unfair treatment or wrongful exactions by the
employer.
11. Any other matter which may be prescribed. -Radii has been added to the Schedule in
August 2016 by the Centre Government. fixed term employment workmen" has been added
to the Schedule in March 2018 by the Centre Government.

AMENDMENTS IN ACT IN 2018

In March, 2018, the Ministry of Labour and Employment notified the Industrial Employment
(Standinc. Orders) Central (Amendment) Rules, 2018 (the "Amendment Act").

Fixed term employment for workmen in all sectors: Previously, under the Act and Rules,
fixed term employment was only allowed for workmen in the "apparel manufacturing sector".
The Amendment Act has liberalized this and allows fixed term employment across all
sectors. The Amendment Act is prospective in nature, and it specifically prohibits employers
from converting the posts of existing permanent workmen to fixed term employment.

Meaning of "fixed term employment workmen": The Amendment Act has introduced the
definition of "fixed term employment workman" in the Rules. A "fixed term employment
workman" is a workman engaged on the basis of a written contract of employment stipulating
a fixed period, provided that

(a) his hours of Work, wages, allowances and other benefits are not less than that of a
permanent workman; and

(b) he is eligible for all statutory benefits available to a permanent workman proportionately
according to the period of service rendered by him.
Termination of employment: No notice of termination of employment is required for
temporary workmen whether monthly rated, weekly rated or piece rated, and probationers or
badli (substitute) workmen. For fixed term employment workmen, if the fixed term contract
is not renewed, then upon the expiry of the contract period, no notice or payment in lieu of
notice is required. However, if a temporary workman is terminated due to alleged
misconduct, he is required to be given an opportunity of explaining the charges.

The Amendment Act prescribes separate termination provisions for temporary workmen in
coal mines. A two (2) weeks' notice is required to be given to temporary workmen in a coal
mine, who have completed three (3) months of continuous service, if the termination is not in
accordance with the terms of the contract of employment. For the termination of temporary
workmen in a coal mine, who have not completed three (3) months' continuous service and
are terminated before the completion of the term of employment, the reasons of termination
have to be intimated in writing. Further, for the termination of badli workmen in a coal mine,
before the return of the permanent incumbent or hefore the expiry of the term of employment,
the reasons of termination have to be intimated in writing.
 Mines act 1952

The Mines Act, 1952 deals with the regulation of labour and safety in mines.
It extends to the whole of India.
[t came into force on 1st July 1952.

Important points
1) A person is said to be employed in a mine who works as the manager or who
works under the owner, agent or manager of the mine, whether for wages or not:
¢ In any mining operation.
* In operations or services relating to the development of the mine.
« In operating, servicing, maintaining or repairing any part of any machinery.
¢ In operations, within the premises of the mine, of loading for despatch of
minerals.
* Inany office of the mine.
» In any welfare, health, sanitary or conservancy, services required to be
provided under this Act.
¢ Inany kind of work connected with mining operations.

2) Inspector (Section 2(i)) refers to an Inspector of Mines appointed under this

Act and includes a district magistrate.

3) Minerals (Section 2(jj)) refer to the substances (including mineral oils, natural
gas and petroleum) that can be obtained from the earth by the following
processes:

¢ Mining
¢ Digging
e Drilling
¢ Dredging
e Hydraulicing
e Quarrying
¢ Any other operation

4) If the work of the same kind is carried out by two or more sets of
persons working in different periods of the day, then each of such sets is called
a relay. Each period is called a shift.

5) A person is said to be working below ground if he is working or employed:

 ¢ in a shaft which has been or is in the course of being sunk or
e in any excavation which extends below superjacent ground.

6) A person is said to be working above ground if he is working in an open cast

working or in any other manner not specified above.

7) Except those contained in sections 7, 8, 9, 40, 45 and 46, the provisions of this
act shall not apply to:

¢ Any mine in which excavation is being made for prospecting purposes and
not for obtaining minerals for use or sale provided that:
* Not more than twenty persons are employed on any one day in any such
excavation.
» If measured from its highest to the lowest point, the depth of the
excavation nowhere exceeds six metres or in the case of coal, fifteen
metres.
* The excavation work shall not extend below superjacent ground.
e Any mine engaged in the extraction of kankar, murrum, laterite, boulder,
gravel, shingle, ordinary sand (excluding moulding sand, glass sand and
other mineral sands), ordinary clay (excluding kaolin, china clay, white clay
or fire clay), building stone, slate, road metal, earth, fullers earth, marl, chalk
and limestone, provided that:
* The work does not extend below superjacent ground.
« |Ifitis an open cast working, the depth of the excavation nowhere
exceeds six metres, the number of employed persons does not exceed
fifty and explosives are not to be used in the excavation process.

8) The Central Government may appoint chief inspector and inspectors.

e If any person is directly or indirectly interested in any mine or mining rights
in India, he shall not be appointed or continue as the chief inspector or an
Inspector.
e The district magistrate may perform the duties of an inspector
but not the powers conferred by section 22 or section 22A or section 61.

9) Qualified medical practitioners shall be appointed as certifying surgeons by the

central government.
e If any person is the owner, agent, manager of a mine or is directly or
indirectly interested in any mine or in any process or business, he shall not
be appointed or continue as the certifying surgeon.
 * The certifying surgeon shall examine the persons engaged in a mine in the
prescribed dangerous occupations, exercise medical supervision for any
prescribed mine in the cases of illness due to the nature of any process
carried on or other prevailing working conditions.

10) The Central Government shall constitute committees for the purposes of this
act. The composition of the committee is as follows:
e Aperson in the government service (not being the Chief Inspector or an
Inspector) shall be appointed as chairman by the central government.
e The Chief Inspector of Mines.
« Two persons shall be appointed by the central government to represent the
interests of miners (at least one person shall represent coal mine workers).
¢ Two persons shall be appointed by the central government to represent
the interests of owners of mines (at least one person shall represent coal
mine owners).
¢ Two qualified mining engineers who are not directly employed in the
mining industry shall be appointed by the central government.

11) In every mine, arrangements shall be made to provide cool and wholesome
drinking water at suitable points for all the employed persons and the points shall
be legibly marked DRINKING WATER in a language understood by a majority of
the persons.
* No point shall be within six meters of any washing place, urinal or
latrine unless approved by the chief inspector.

12) A first-aid room with the prescribed equipment, medical and nursing
staff shall be provided in every mine wherein more than one hundred and fifty
persons are employed.

13) If the medical practitioner attends and believes that a person working in a
mine is suffering from any notified disease, the medical practitioner shall send a
report in writing to the chief inspector stating the name and address of the
patient, the disease and the name and address of the mine.
« If any medical practitioner fails to report, he shall be punishable with
a maximum fine of fifty rupees.