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Discourse On The Labour Law Regime In India

In India, after independence, the primary concern is social justice which includes factories and laborers which have a bulk population that cherishes both social and economic justice. The Universal Declaration of Human Rights also recognizes social security, economic, and cultural rights, and freedom and free development of society for every member.

The economic and social-cultural conditions have mainly influenced Indian labor legislation which mainly regulates the different number of hours of work, wages, social security, and facilities provided. Labor legislation has been comprehensively discussed such as The Employee's Compensation Act 2017, The Payment of Wages Act 2017, and the Equal Remuneration Act which prevails in India

In the globalizing world Industrial relations are changing promptly, and the disturbance in relations causes problems such as strikes, and lockouts set ablaze. It is imperative to have collaboration between management and labors. There must be harmony between them for social, economic, and political development. The mutual relationship between labor and employees leads to the success of an industry.

Understanding Labour Legislation in India

In India, at present, there are more than 40 existing enactments that regulate the social security and rights of the workers/employees. The courts also reiterated the legislative principles and laid down principles for labour conduct in India. The intrinsic objective is the growth of labour legislation. Well-established legislation is the backbone of the industrial sector which provides smooth functioning of the labour industry Some of them are as enumerated -

The Industrial Disputes Act of 1947 This act streamlines a network of machinery and authority stipulating power and procedure. This act applies to industrial disputes that exist or are likely to exist between employer and employee, it provides a comprehensive mechanism for the redressal of disputes such as a Conciliation officer, Board of conciliation, Court inquiry, Labour Court, Tribunal, and National Tribunal.

Thus act specifies layoff or retrenchment compensation to the workmen. It also strives for payment of compensation to workmen in case of transfer or closure of the establishment. It contains provisions for strike and lockout in public utilities as well as for non-public utility services.

The Trade Union Act,1926. This act intends to unite the workmen and protect their service conditions and interests. This strives for the registration of trade unions and in certain respects to define the law relating to registered trade unions. It lays down the foundation for the existence of trade Union law in India. This act was passed to ensure that the workers employed in industries could organize themselves into unions so that they could put forth their demands and even fight to achieve justice. To get Legal recognition, a trade union must get itself registered in the office of the registrar.

The appropriate government, in relation to a trade union whose objects are not confined to one state, is the central Government, and in relation to other trade unions, the State government. They can appoint a Registrar of Trade Union whose duty is to register the trade unions. This is normal administrative work that has to be performed by officials under the act .

The Employees Compensation Act ,1923 The Bill was passed on 5th March 1923, It came on the statute book as the Workmen's Compensation Act,1923(8 of 1923). By section 4 of the Workmen Compensation (Amendment) Act 2009, the nomenclature of the act has been changed by substituting the word 'Employees' for the word Workmen's. Now this act stands for the Employee's Compensation Act, of 1923. This act intends to provide compensation for only injuries that produce disability and thereby presumably affect the earning power, Unlike tort.

It also includes occupational diseases as listed in the III schedule. The amount of compensation to the workmen depends upon the nature of disablement. The dependants of the deceased workmen are also entitled to claim. The self-inflicted injuries are outside the purview of this act, workmen are not entitled to compensation in such cases. This act provides penal consequences offense which may extend to Rs 5000 for contravention of some of its provision.

The Payment of Wages Act ,1936 This legislation provides protection for workers, and any maneuver by employers in the payment of wages. This act applies to the first instance, to persons who are employed in any factory or any railway or in an 'industrial or other establishment' as defined therein. However, the 'appropriate government is competent to extend the provision of the act to any other establishments. Currently, it applies to wages payable to an employed person in respect of a wage period which, over such wage period, does not exceed Rs 10,000 per month.

The principal 'Regulators provided by the act are the government (Central or State, Inspector, and authority appointed by the 'Appropriate government' to hear and decide claims arising out of deductions from wages or delays in payment of the wages of employees. This act provides consequences for contravention of its provisions, which are a fine or imprisonment, or both.

The Payment of Bonus Act, of 1965 It provide the payment of bonus to employees on the basis of profit or on the basis of productivity or production in the industry. The purpose is to establish rewards to employees in all sharing profit earned by the industry. This way employees enhance their morale at work. Any employee with a salary of Rs 21,000 per month doing any work in any industry.

An employee is paid a minimum bonus of 8.33 % of the salary for the fiscal year of Rs 100, the higher of the two. The employee can earn a maximum of 20% of the salary as a bonus amount. This act in violation in any case imposes a penalty as impro of up to 6 months or can be fined Rs 1000 or both.

The Code of Wages ,2019 codifies and amends the extant laws of payment of wages, bonus, and remuneration of organized and unorganized sectors of employment. It intends to simplify the implementation, and enforcement and harmonize the labour law regime in India.

It consist of the following acts:
  1. The Payment of Wages, 1936 ('Wage Act')
  2. The Minimum Wages Act, 1948
  3. The Payment of Bonus Act 1995 ('Bonus Act'), and
  4. The Equal Remuneration Act, 1976.

These legislations have been incorporated into separate chapters under the code. The act adopted a gender-neutral approach by prohibiting discrimination in matters of payment of recruitment, it provides equal remuneration for the same work or work of a similar in nature regardless of gender. It reduced the working hours to 8 hours inclusive of rest and intervals. The definition of wage has been uniform across all labor laws and it mandated the payment of wages to all categories of employers. The approach of the code is to simplify, to rationalize the wage with an effective Grievance Redressal Mechanism.

The Maternity Benefit Act of ,1972 This act is to regulate the employment of women in certain establishments for working women to provide different kinds of benefits to Female Wage-earners. The act imparts a benefit to women for a certain period before and after childbirth and specify other benefits. At the outset, maternity protection was strived under different state acts and three central acts. The legislation stipulated a separate law to reduce the disparities.

The Payment of Gratuity Act, 1972, This act is an exhaustive legislation, the right of gratuity is a statutory right, It is available to those who have rendered five years of continuous service and whose service stands terminated after commencing of the act on the account of superannuation, or retirement, or resignation or death or disablement. It provides a gratuity scheme to retiring benefits to workmen who have rendered long and unblemished service to the employer and thereby contributed to the prosperity of the employer.

This act also lays down a mechanism for redressal of the grievance under this legislation. In instances where the employer declines payment of gratuity to the workmen, then an application is required to be made to the controlling authority for the purpose. The Payment of Gratuity (Amendment) Act,2010, and thereby section 4 has been amended the words "Ten lakh rupees 'have been substituted for the words "three lakh and fifty thousand". Thus the amount of remittance to an employee shall not exceed ten lakh rupees.

The Employee's Provident Funds And Miscellaneous Provisions Act ,1952 The Constitution of India provides under Directive Principles of State Policy in Part IV that the state strives to promote the welfare of people. Subsequently, this act came with the idea of social security of the workers. This act contemplates provisions for industrial workers after they retire.

The Child Labor and Adolescent Labour (Prohibition and Regulation) Act ,1986 The UN declaration of the child right in 1959 recognized the rights of children. The main thrust of the act is to ban the employment of children below the age of fourteen years in specified occupations and processes. It lays down the working conditions for them and also enhancement of penalty for violation of any law under this act.

There has been an amendment by Act 35 of 2016 which includes adolescents within the scope, it also prohibits the employment of children in all occupations or processes. The principal 'Regulators' provided by the act are the Central Government and or the State Government, the "Child Labour Technical Advisory Committee", inspectors and the prescribed medical authority. Any contraventions to the act lead to fine or imprisonment or both .

The sexual harassment of Women at Workplace (Prevention, Prohibition and Redressal) act, 2013 (POSH ) This act provides the meaning of 'Sexual harassment' which is the need to combat it, the responsibility to check it, and to provide redress to the victims. In order to realize this vision of The Millennium Development Goals which aims at Gender Equality it is essential to remove gender biases which is the biggest obstacle.

Sexual harassment at the workplace identifies two main forms that are Sexual blackmail (quid pro Quo harassment) which means denial of an economic benefit to punishing the victim for rejecting a sexual overture of an economic benefit to punish the victim for rejecting sexual demand and hostile environment harassment characterized as intimidating, hostile and offensive working environment but did not necessarily result in economic loss in relation to a rejection. It also defines the workplace beyond the traditional approach. It also includes telecommuting and places visited by employees for work . It applies to the private and public sectors.

The complaint mechanism includes (ICC )Internal Complaints Committee where women can file formal complaints. It has to be headed by women. This act also mandates having a Local Committee(LC) at the district level Employees such as domestic workers, and home-based workers can also file their complaints.

The dissatisfaction among the management and labours ,insecurity in them is the root cause of breakdown of Industrial relation. The major reason behind it is communication gap between employee and employers. In India as a poor state wages are a means of livelihood, and labourer wages are everything. One-fourth of strikes are caused due to low wage rates, instances such as illegal wage cuts are also resented by the workers. Collective bargaining is the one mechanism where workers represent themselves.

The concept of minimum wage is flexible in India and very dynamic, fixation and frequent changes are not enough its enforcement must be effective to benefit laborers. Social security against common risks such as life, employment injury, occupational diseases widowhood, old age, orphanhood, etc It is necessary to provide security because without it an average citizen can never live or rather, die peacefully because such risks are not only numerous but their incidence is also fairly high and complex.

There could be a useful measure for bringing out good results for harmonious industrial relations between management and employees both counterparts are necessary like the example of a sound mind in a sound body, both counterparts are necessary for each other. The welfare of one part affects another. If the management is working well, the wisdom of employees is also expected same. Likewise, if the employees are satisfied with good conditions then will support the management. True management should have a welfare approach to give due care, fair, justful steps.

The manager's role should be balanced and complete adopting fair and just methods They should identify steps before taking steps to decide on goals, the course of action to be adopted lastly emergency steps to be thought in advance, A Good atmosphere industry must be created between employees and employers. On the other hand, employees also should not use strike as a weapon .Industrial Relations are crucial and complex. In brief the faith is need on both the sides for functioning.

  1. S.S. Rana & Co. (2023, June 26). S.S. Rana & Co.
  2. Code on Wages Ministry of Labour & Employment | Government of India. (n.d.)
  3. Sood, G. (2021, November 15). POS Act 2013 - Regulations And Implementations. Lexology.

Written By:
  1. Ankit Tiwari And
  2. Amrita Nirapure

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