Labour Welfare

Srini : MBA-HRM/ Second Year/Labour Welfare/ Lessons:1-25
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ANNAMALAI UNIVERSITY
DIRECTORATE OF DISTANCE EDUCATION
M.B.A. Human Resource Management

Second Year
LABOUR WELFARE
LESSONS : 1 – 24
Copyright Reserved
(For Private Circulation Only)
M.B.A. HUMAN RESOURCE MANAGEMENT
Second Year
LABOUR WELFARE
Editorial Board
Members
Prof. Dr. E. Selvarajan

Dean
Faculty of Arts
Annamalai University
Annamalainagar
Dr. C. Samudhra Rajakumar Prof. Dr. M. Sivasubramanian

Head Professor
Department of Business Administration Department of Business Administration
Annamalai University Annamalai University
Annamalainagar Annamalainagar
Internals
Dr. K. Anandanatarajan Dr. T. Vezhavan
Assistant Professor Assistant Professor
Department of Business Administration Department of Business Administration
Annamalai University Annamalai University
Annamalainagar Annamalainagar
Externals
Dr. S. Kaliyamoorthy Dr. B. Rajasekar
Director Alagappa Institute of Management Professor and Head
Alagappa University Department of Business Administration
Karaikudi University of Madras
Chennai
Lesson Writer
Dr. N. Shibu
Professor and Head
Department of Management Studies
Bharathidasan University College
Perambalur
Second Year
LABOUR WELFARE
SYLLABUS
Unit–I
Labour Welfare: Meaning, Scope and Significance – Labour Welfare Agencies -
Labour Welfare Officer – Qualities of Welfare Officer- Types of Welfare Services- statutory
measures for welfare provisions- Growth and Concept of labour welfare in India.
Unit–II
Terminology and Meaning of Fringe Benefits- History and Growth of Fringe
Benefits in India – Coverage of Benefits- Administration of Benefits and Services –
Problems Raised by Benefit Programs- Human Needs: Meaning- The Changing
Nature of Human Needs- The Major Role in Need Fulfillment.
Unit–III
Welfare Officers Role & Responsibilities – Duties of Welfare Officers- Training
of Welfare Officer – Aims and Objectives of Workers Education- Recommendations
of National Commission on Labour, Meaning of Fatigue- Monotony and Boredom-
Methods for Reducing Fatigue.
Unit–IV
Significance of Occupational Health - Occupational Hazards and Diseases-
Protection Against Health Hazards - Statutory Provisions under Factories Act 1948-
Industrial Accident- Nature of Accident- Causes of Accident- Accident
Measurement- Basis of Safety Programme and Policy- Industrial Medical Officer.
Unit–V
Laws of Working Condition- Factories Act- Shops and Establishment
Act- Mines Act – Plantation Labour Act – Indian Merchants Shipping Act - Laws on
Social Security
Unit–VI
Workers Compensation Act - Maternity Benefits Act – Employees Provident
Fund Act- Payment of Gratuity Act- ESI Act.
Reference Books
1) N.G. Nair “Personal Management and Industrial Relations”, 2012.
2) R.C. Sexane “Labour Problems and Social Welfare”, 1981.
3) A.M.Sharma “Aspects of Labour Welfare and Social Security”, Himalaya
Publishing House, 2013.
4) C.B.Memoria – “Dynamic of Industrial relations in India”, Himalaya Publishing
House, 2008.
Journals and Magazines
1) The Indian labour Journal.
2) Asian Journal of Management Research.
3) Journal of Contemporary Research in Management.
4) International Journal of Humanities and Social Sciences.
Web Resources
1) delhi.gov.in/DoIT_planning/wt189.pdf
media.scribleindia.com/.../industrial-relations-and-labour-welfare.pdf
ii

SECOND YEAR
LABOUR WELFARE
CONTENTS
Lesson Page
Title
No. No.
Unit-I
1. Labour Welfare - Meaning Scope of Significance 1
2. Labour Welfare Agencies - Labour Welfare Officer - Qualities of Welfare Officer 7
3. Labour Welfare Agencies - Labour Welfare Officer - Qualities of Welfare Officer 17
4. Growth & Concept of Labour Welfare in India 22
Unit - II
5. Terminology, Meaning, History and Growth of Fringe Benefits in India 28
6. Coverage of Benefits - Administration of Benefits and Services - Problems - 36
Types of Fringe Benefits
7. Basic Human Needs - Change Nature of Human Needs 39
8. The Major Role in Need Fulfillment - Major Role in Human Need Fulfillment 46
Unit - III
9. Welfare Officers - Roles and Responsibilities - Duties of Welfare Officers - 50
Training Of Welfare Officer
10. Aims and Objectives of Workers Education 56
11. Recommendation of National Commission on Labour 62
12. Meaning of Fatigue - Monotony and Boredom - Method for Reducing Fatigue 73
Unit - IV
13. Significance of Occupational, Health Occupational Hazards & Diseases - 76
Protection against Health Hazards
14. Statutory Provisions Under Factories Act 1948 83
15. Industrial Accident, Nature of Accident and Causes of Accident 95
16. Accident Measurement - Basis of Safety Programme and Policy - Industrial 99
Medical Officer
Unit - V
17. Factories Act - Laws of Working Condition 104
18. Shops and Establishment ACT - MINES ACT 122
19. Plantation Labour Act 136
20. Indian Merchant’s Shipping Act 151
21. Laws on Social Security 157
Unit - VI
22. Workers Compensation Act - 1923 164
23. Maternity Benefits Act 181
24. Employees Provident Fund and Payment of Gratuity Act - ESI 193
UNIT - I
LESSON - I
LABOUR WELFARE - MEANING SCOPE OF SIGNIFICANCE

1.1 INTRODUCTION
Labour is the most important factor of industrial production. Labour welfare
work aims providing services facilities and Amenities which enable the workers
Employed in Industries to perform their work in healthy congenial surroundings
conductive to good health & high morale. An Employer may voluntarily initiate
Labour welfare measure in his undertaking with the objective of having
philanthropic and paternalistic feeling win Employers Loyalty, increase morale,
combat trade unionism and socialist ideas, develop efficiency and productivity
among workers & earn good will and embrace public image.
1.2 OBJECTIVES
 Ager reading this chapter you should be able to
 Understand the definition, nature & objective of Labour welfare.
 Know about the scope of Industrial Relation.
 Know the significance of Industrial Relation.
1.3 CONTENTS
“Efforts to make Labe work loving for worker”
– The Oxford Dictionary
“Labour welfare means such services, facilities & amenities which may be
established in or in the vicinity or undertakings to enable persons employed there
into perform their work in healthy and congenial surroundings and to provide them
with Amenities conductive to good health and good Morals”.
– International Labour Organization
Scope
Labour Welfare is a part of social welfare, both conceptually and operationally.
It covers state of well - being, happiness, satisfaction, conservation & development
of human Resource The scope of Labour, welfare may be viewed.
 As a Total conceptual
 As a social conceptual and
 As a Relative conceptual one.
Total Conceptual
It is a existence state involving Physical, Mental & Emotional well being. These
elements together constitute the scope of welfare on which the totality is based.
The Social Conceptual
Is states the welfare of man, his family and his community and are
interrelated.
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The Relative Concept of Welfare

Implies welfare is Relative of time & place. It differs with Time, Region,
Industry and Country depending on the value system.
 The social welfare aims at social development by such mean as social
Legislation, social reform, social service, social work and social action. Thus the
scope is to fulfill the social, health & recreational requirements of all
Individuals in a society.
Significance
Objectives of Labour welfare
Following are the objectives of the voluntary Labour welfare sources by
employer:
1. To Develop efficiency & productivity among works.
2. To reduce of threat of further govt. Intervention.
3. To make Recruitment more effective.
4. To own over employees’ loyalty & increase their morale.
5. To save one self from one heavy taxes & from surplus profits.
6. To earn good well & Enhance public image
7. To Combat Trade unionism and socialist ideas.
8. To Fulfill the future needs and aspiration of Labour.
9. To Develop a sense of Responsibility and dignity.
10. To enable workers to enjoy a fuller and richer life.
Reasons for Labour welfare Activates
Following are the Reason for the Labour welfare activates in India. By
understanding the Reason, the significance of Labour welfare can be understood:
a) Increase in efficiency of workers
b) Helpful in Reducing the state of Poverty among employees.
c) Establishment of Industrial Peace
d) Helpful in Maintaining health and physical ability of Employees.
e) Helpful in Reducing the Rate of absenteeism on & Labour Turnover.
a) Increase in efficiency of Employee
Labour welfare, Activities increase the efficiency of Employee at work. These
facilities help in developing the feeling of dedication among them. Due to Increase
in efficiency, the production & the productivity of the Enterprise increase
considerably.
b) Helpful in Reducing the State of Poverty among Employees
A grate problem in Industrial Development of our country is the Extreme
poverty among Indian workers. Most of the workers in our country are unable to
provide the basic necessities for themselves and to their family members. Thus
provision of Labour Welfare Activities play on Important Role in Reducing such
poverty and in providing essential amenities to the workers.
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c) Establishment of Industrial Peace

Labour welfare Activities help in establishing harmonious relations between
employees & Employers. Employees realize that they are getting all the possible
facilities and the Employers take care of them. Such feeling among Employees
helpful in establishing Industrial Peace.
d) Helpful in Maintaining Health and physical ability of Employees
Most of the Indian workers are unhealthy and ill fed. It Reduces the
production capacity of Employees. Provision of Nourishing Food & Medical Facilities
help in Maintaining health & Physical Ability of Employees.
e) Helpful in reducing the Rate of absenteeism and Labour turnover
The Rate of absenteeism and Turnover is much higher in India as compared to
that of developed countries of the world. Provision of Labour welfare activities help
in Reducing this Rate because the workers feel themselves well settled at one place.
Principles of Labour welfare
The following principles should be kept in mind and properly followed to
achieve successful implementation of welfare programmes:
1. Principles of social responsibility of industry.
2. Principle to totality of welfare
3. Principle of accountability
4. Principle of timeliness
5. Principle of responsibility
6. Principle of association or democratic value
7. Principle of efficiency
8. Principle of co-ordination or integration
9. Principle of adequacy of wages
10. Principle of re-personalization
11. Principle of self help.
1. Principles of social responsibility of industry
Industry is a sub system of the society. It draws its manpower from the
society. Obviously, industry has an obligation or duty towards its employees to look
after their welfare. According to this principle, to provide welfare facilities to the
employees is a social responsibility of the industry.
2. Principle of totality of welfare
According to this principle, labour welfare activities and facilities must be
extended to all employees of the organization. This is because the goal of the
organization will not be achieved even if a section of the employees are unable to
counteract the baneful effects of industrial system.
3. Principle of accountability
This principle is also called principle of evaluation. This principle suggests that
the welfare programmes must be evaluated periodically. This is very much
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necessary to judge and analyse the success of welfare programme shall recognize it
for better results.
4. Principle of timeliness
The time liners of any welfare programme help in its success. To find what the
labour welfare needs are and what kind of welfare programmes are and what kind
of welfare programmes are necessary, the time required is very important. Timely
action in proper direction is essential in any kind of welfare activities.
5. Principle of responsibility
This principle is based on the assumption that labour welfare is the joint
responsibility of employers and employees. According to this principle, labour
welfare becomes the simple and easiest task, because the responsibility is shared
by different groups.
6. Principles of association or democratic value
For the success of a welfare programme, association of employees in planning,
organizing and implementation is most essential. Employees, who have associated
in planning, organizing and implementation of welfare activities, get keenly
interested in the welfare programmes.
7. Principle of efficiency
Efficiency of the workers and welfare facilities are interdependent. Hence,
principle of efficiency plays an important role in organizing welfare facilities in the
industry. Employers quite often provide welfare facilities to their employees as it
would increase their efficiency which would in turn lead to increase in productivity.
8. Principle of co-ordination or integration
The Principle of coordination or integration plays an important in the success
of welfare programmes. Welfare measures to be effective need a co-ordination or
integration approach. This will promote a healthy development of the employees in
their work, home and community. This is essential for integrating employees to
their work environment.
9. Principle of adequacy of wages
According to this principle, workers have a right to adequate wages. Labour
welfare facilities must be provided over and above the adequate wages. That means
labour welfare measures cannot be a substitute for wages. At the same time, it is
also true that high wage rate alone cannot create healthy atmosphere nor bring
about a sense of commitment on the part of workers. A combination of wages and
labour welfare together would achieve good results.
10. Principle of re-personalization
This principle suggests that the goal of labour welfare should be the overall
development of the employees. According to this principle, labour welfare measures
help the workers to resist the poisonous effect of industrial system. Therefore, it is
necessary to organize labour welfare activities both inside and outside the factory.
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11. Principle of self help

This Principle suggests that the labour welfare must aim at helping employees
to help themselves in future. This helps employees to become more responsible and
more efficient.
1.4 REVISION POINTS
1. Labour welfare is a part of social welfare both conceptually & operationally. It
covers state well being, happiness, satisfaction, conservation & Development
of human Resources.
2. Labour welfare is an Important dimension of Industrial Relation Labour
welfare includes overall welfare facilities designed to take care of well being of
employees and to increase to their living standards. It close not generally
constitute monetary benefits nor these are provided by Employers alone. It
can also be provided by Govt., Non Govt. agencies and Trade Union.
Industrialization, Mechanization and Globalization has increased Importance
of Labour Welfare in Industries.
1.5 INTEXT QUESTIONS
1. What do you understand by Labour welfare? Discuss the need & Importance
of Labour welfare in India.
2. ‘Man is essentially a Religions Animal’. Elucidate this statement
3. Discuss the Reasons for Labour welfare Activities in India.
4. How do you view the Labour welfare?
5. What are the objectives of Labour welfare keeping in Mind the significance of
Labour Welfare?
6. Elaborate on the various Principles of Labour welfare with regard to
significance of Labour Welfare.
1.6 SUMMARY
The Improvement of Labour welfare and Increasing productivity with
reasonable level of security is one of the prime objective concerning Labour welfare.
The Significance of Labour Welfare has much greater need in our country than any
other country. There are certain deficiencies in Indian Labour Forces those are not
found in other countries. It is because of these deficiencies and defects the
significance of Labour welfare Activity in our country has been greater.
The Significance of Labour welfare is because of Lack of strong Labour union
movement, illiteracy, problem of absenteeism and Migration, Low level of health &
Nutrition, Extreme poverty, Lack of Training & Lack of healthy Recreation.
1.7 TERMINAL EXERCISES
1. Discuss, the Approaches to Labour Welfare.
2. Define Labour Welfare.
3. What is Principle of Re-Personalization in Context of Principle of Labour
Welfare?
4. Does Labour Welfare makes Recruitment effective?” Discuss
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5. How is Labour Welfare Accountable?

6. “The welfare must Aim at helping Employees to help themselves in Future”?
Discuss.
1.8 SUPPLEMENTARY MATERIALS
1. ILO, Asian, Regional Conference Report II, 1950
2. Indian Labour Journal, New Delhi.
3. Labour Chronicle Mumbai.
4. Annual Report, Ministry of Labour, 1994-95.
5. www.outsource2india.com
1.9 ASSIGNMENTS
1. Dr.Mahesh Bhatt has been recently Appointed as Director Medical Services,
AIIMS, New Delhi. The Appointment order stated that he well be on probation
for a period of six months.
2. Will the Probationer, Dr.Mahesh Bhatt be Automatically Confirmed after the
expiry of one year?
1.10 SUGGESTED READINGS / REFERENCE BOOKS
1. Nandha Kumar B., Industrial Relations, Labour Welfare & Labour Laws.
2. Tripathi. P.C. Personnel Management & Industrial Relations.
3. Snell, Bohlander Vohra, Human Resourcement.
4. Kind Kaday, H.S. “The Sprit of Industrial Relations”.
1.11 LEARNING ACTIVITIES
1. Further Reading on Report of National Commission of Labour, 1966 Can be
done to enrich the knowledge.
1.12 KEYWORDS
1. Industrial Relation : Surplus Profits
2. Absenteeism : Productivity
3. Labour Turnover : Social Welfare Morale
4. Morale : Social Reform

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LESSON - 2
LABOUR WELFARE AGENCIES - LABOUR WELFARE OFFICER -

QUALITIES OF WELFARE OFFICER
2.1 INTRODUCTION
The factories Act 1948 made it obligatory on the part of Employees to appoint
welfare officers to look after Labour welfare activities in factories where 500 or more
than 500 workers are employed. Thus the appointment is a statutory Requirement.
There are many agencies which work for Labour welfare. There are DGMS, NSC and
CLI. In India most of the Industries are not using welfare concept property at their
workplace. In India, Industrialists compel workers to work in uncomfortable /
Adverse condition. There conditions lead to serious damage to workers. Therefore it
is the job of welfare officers to look into those Industrial houses to have
maintenance of Labour welfare which is a must in the identity premises.
2.2 OBJECTIVES
 After Reading this chapter you should be able to
 Know the Agencies for Labour welfare.
 Know the Duly & Responsibility of Labour welfare officer
 Comprehend the principles involved in successful Implementation of welfare
programmes
 Know the qualities to be possessed by welfare officers.
 Know the Evaluation of Labour welfare in India.
 Applicability of Labour Laws for women.
2.3 CONTENTS
The Agencies for Labour welfare in India
The following agencies work for the labour welfare in India:
a) Directorate General of Mines Safety (DGMS)
b) National Safety Council
c) Central Labour Institute.
a) Directorate General of Mines Safety
The Director General of Mines Safety enforces the Mines Act 1952. He inspects
electrical installation and machinery provided in the mines and determines the
thickness of barriers of two adjacent mines in order to prevent spread of fire and
danger of inundation. He also investigates accidents and conducts industrial
hygiene surveys. He is entrusted with the power of prosecution in case of violation
of statutory provisions.
b) National Safety Council
The National Safety Council was set up on 4th March, 1966 in Bombay at the
Union Ministry of Labour and Rehabilitation, Government of India as an
autonomous national body with the objective of generating and developing a
movement of safety awareness at the national level. The affairs of the council are
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managed by a Board of Governors which has 51 members besides the Chairman

who is nominated by the Government of India. The Director General who is also the
secretary of the Board of Governors, is the chief executive of the council.
Following are the main activities of this council:
1. It lends films to its corporate members for being screened to their employees
for creating safety awareness.
2. It organizes conferences, seminars and symposia on different topics related to
problems of safety and health referred by them.
3. It provides information-cum-technical advice to its members on specific
problems of safety and health referred by them.
4. It maintains liaison with the international agency like ILO, WHO, the British
Safety council, etc
5. It organizes national safety competition (essay, poster and slogan) every year
to encourage creative thinking at the grass root level.
6. It brings out a quarterly journal ‘Industrial safety Chronicle’ and a monthly
news letter, ‘Industrial Safety news’. It also brings out every year other type of
publicity material to propagate safety consciousness.
7. It conducts both need based and specialized training programmes for all types
of industries.
8. It undertakes safety audits, surveys and studies of the industrial plants on
specific request from its members.
Central Labour Institute
The institute was set up in Bombay in 196 to facilitate the proper
implementation of the Factories Act, 1948; to provide a centre of information for
inspectors, employers, workers, and others concerned with the well being of
industrial labour and to stimulate interest in the application of the principles of
industrial safety, health and welfare. Regional labour institutes have been set up in
Calcutta, Madras and Kanpur in order to give the Central Labour Institute
adequate filed support.
Labour welfare officer
The Indian Factories Act 1948, made it obligatory on the part of the employers
to appoint welfare officers to look after the labour welfare activities in the factories
where 500 or more than 500 workers are employed. Thus the appointment of
labour welfare officer is a statutory requirement. He works with human resource
officer to solve the labour - related problems.
Duties and functions of labour welfare officer:
1. To encourage the formation of workers and joint production committees, co-
operative societies, safety and welfare committees and supervise their works.
2. To advise and assist the management in the fulfillment of obligations,
statutory or otherwise, concerning the application of provisions of the
Factories Act, 1948, and the rules made there under and the medical services
concerning medical examination of employees, records, supervision of
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hazardous jobs, visiting the sick, accident prevention, supervision of safety

committees, safety education and investigation of accidents.
3. To encourage the formation of workers and joint production committees, co-
operative societies, safety and welfare committees and supervise their works.
4. To promote relation between management and workers which will ensure
productivity, efficiency as well as ameliorate the working conditions and to the
help workers to adjust and adapt themselves to their working environments.
5. To establish contacts and hold consultations with a view to maintain
harmonious relations between the management and the workers.
6. To advise and assist management in the provision of amenities such as
canteens, shelters for rest, crèches, adequate latrine facilities, drinking water,
sickness and benevolent schemes, payments, pension and superannuation
funds, and gratuity payments.
7. To bring to the notice of workers their rights and liabilities, under standing
orders of the establishment and other rules which grant rights to define the
duties of workers, or which are directed to the discipline, safety and protection
of workers and establishment.
8. To advise and assist the management in providing welfare facilities such as
housing facilities, food, social and recreational facilities, sanitation, education
of children and advise on individual personal problems.
9. To suggest measures which will serve to raise the standard of living of
workers, and in general, promote their well-being.
10. To being to the notice of the management the grievances of workers,
individual as well as collective, with a view to securing their expeditious
redressal.
11. To advise workers against going on illegal strikes and the management against
illegal lock-outs and to help in preventing anti-social activities.
12. To study and understand the point of view of labour in order to help the
management to shape and formulate labour policies and interpret their
policies to the workers in the language they can understand.
13. To help the management in regulating the grant of leave with wages and
explain to the workers in the matter of submission of application for grant of
leave for regulating authorized absence.
14. To maintain an impartial attitude during illegal strikes, lockouts and help to
bring about a peaceful settlement.
Labour Welfare Officer
As early as 1931, the Royal Commission on Labour recommended the
appointment of a labour officer to eliminate the position of evil practices of jobbers
who used to engage and dismiss labour. Initially, employees did not pay heed to
this recommendation. But the State Government took the initiative in 1934, when it
passed the Bombay Disputes Conciliation Act, providing for the appointment of a
government labour officer who would deal with labour grievances. The same year,
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the Bombay Mill Owner’s Association was persuaded by the State Government to
appoint its own labour officer. Cotton Textile mills followed suit and 26 labour
officers were appointed in the Bombay Textile Mills by 1940.
However, during the War, the police function gradually change to welfare
function, and the labour officer assisted in the setting up of food shops and the
organizations of sports and welfare activities for employees. Gradually this position
began to discharge the functions of a labour welfare officer. In 1946, the Labour
Investigation Committee strengthened its position and its importance was stressed
in the Factories Act of 1948, which stated that “the owner of every factory with 500
or more workers is obliged to employ the prescribed number of welfare officers.”
Who is Labour Welfare Officer?
Schedule 49 of the Factories Act 1948, provides that in every factory wherein
500 or more workers are ordinarily employed, the employer shall appoint a person
who can act as an advisor, counselor, mediator between the management and the
labour, for improving the efficiency, productivity and profitability of organization.
Here he/she is called Labour Welfare officer.
Professionally he or she should be post graduate in social science, diploma in
labour welfare, recognized by the State Government,3-5 years working experience
in Industrial Safety and finally having hard working ability and sound
communication skills.
MAIN OBJECTIVES OF THE POSITION
a) To eliminate the evils of the jobber system in the recruitment of labour.
b) To develop and improve the labour administration in mills / factory.
c) To serve as a liaison with the State Labour Commissioner.
The importance of labour welfare officers in Indian Industries was emphasized
in 1931 when the Royal Commission of Labour recommended the appointment of
labour to protect the workers forms the evils of indebtedness. To act generally as a
spokesman of labour and to promote cordial settlement between the workers and
the management.
According to Mines and Factories Act, “For every mine where in 500 or more
are employed by the owner, the agent or manager shall appoint a suitably qualified
person as welfare officer”.
The committee on labour welfare (1969) has prescribed the following duties of
a labour welfare officer:
a) The Labour welfare office will be a supervisor of,
 Safety, health and welfare programmes.
 Working of joint committees.
 Grant of leave with wages.
 Redresses of workers’ grievances.
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b) Counseling workers in,

 Personal and family problems.
 Adjustment to their work environment.
 Understanding their rights and privileges.
c) Advising management on matter of,
 Formation of labour and welfare policies.
 Apprenticeship training programmes.
 Meeting statutory obligations to workers.
 Developing fringe benefits.
 Workers education and use of communication media.
d)To establish liaison with workers.
 Understand the limitations under which they work.
 To maintain the good industrial relations.
 Interpret the company policies correctly.
 To settle the industrial dispute.
d) Liaison with workers so that they may,
 Appreciate the need for harmonious industrial relations in the plant;
 Resolve disputes, if any;
 Understand the limitations under which they operate; and
 Interpret company policies correctly.
e) Liaison with management so that they may,
 Appreciate the worker’s view point on various matters connected with the
plant;
 Meet their obligations under the Act;
 Maintain harmonious industrial relations in the plant;
 Suggest measures for the promotion of the general well-being of workers.
g) To improve the productivity
h) The welfare officer has to act as an advisor, counselor and mediator between
management and workers.
The welfare officer should possess a university degree or diploma in social
services/ social work / social welfare from a recognized institution. The Factories
Act and the Mines Act provide for the appointment of one or more welfare officers.
According to Plantation Labour Act “In every plantation wherein 300 or more
workers are ordinarily employed, the employer shall employ one or many welfare
officers in the factory”.
A Labour welfare officer basically a counselor with competent technical
knowledge, well versed in labour laws (statutory and non-statutory) and human
values and able to guide and advice for corrective decisions and actions against the
problems the employees are facing. His or her primary skills must be actively
listening, responding and questioning. While counseling he / she should ask
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questions, listen attentively what the counselee says, observe the body language of
the counselee, ascertain the core problem tactfully, be patient and remain neutral,
should not offer solutions even before the counselee explains the problem, give or
impose solutions, be critical and judgmental, finally jump to final judgments and
ventilate emotions.
Through proper counseling and supervising, a labour welfare officer can help
employees and employers in many ways like:
 Assists the employees to resolve difficulties in a supportive and professional
manner, Whether a crisis or something that has been worrying the employees
for sometimes, counseling can assist them to understand the problem, its
impact and to develop strategies to cope with it.
 Can provide result in quicker them to understand resolution of the problems
with less strategies to cope with it.
 Helping the employees to have better control over their lives, take their
decisions wisely and better charge of their responsibilities; reduce the level of
stress and anxiety.
 Employees and employers both can have desirable consequences for the
organization.
 Helps the organization by building a sense of commitment among the
employees that the organization care for them, Finally modify the behaviour of
the employees and more so to reinforce the desired behaviour and improve
and increase the employee productivity.
In brief, the welfare officer has to concern himself with the implementations of
labour laws and the maintenance of proper working conditions, with matters
relating to the worker’s well-being; with industrial peace and harmonious labour
relations. He has to plan to increase productivity and is expected to act, while
discharging his responsibilities, as an advisor, counselor, mediator and liaison man
between management and labour.
Approaches the Labour Welfare
Approaches to employee welfare refer to the beliefs and attitudes held by
agencies which provide welfare facilities. Some agencies provides welfare facilities
by religious faith, others as a philanthropic Jutty and the like.
The various approaches to labour welfare reflect the attitudes and beliefs of
the agencies which are engaged in welfare activities. Welfare facilities may be
provided on religious, philanthropic or some other grounds. Moreover, the different
approaches to labour welfare reflect the evolution of the concept of the welfare. I
bygone days, the government of the land had to compel the owner of an industrial
establishment to provide such basic amenities as canteens, rest rooms, drinking
water, good working conditions, and so forth, for their employees. Such compulsion
was necessary because the employer believed in exploiting labour and treating it in
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an unfair manner. But times have changed, and the concept of welfare, too, has
undergone changes.
May progressive managements today provide welfare facilities voluntarily and
with enlightened willingness and enthusiasm. In fact, welfare facilities are not
restricted to the workers alone. They have now been extended to the society in
general. In other words, labour welfare has been extended to include social welfare.
Tata Steel works at Jamshedpur, for example, spends Rs.10 core each year on
social welfare. Brooke Bond have set up a free animal welfare clinic at Gevrai,
Aurangabad, under the direct charge of a qualified veterinary doctor. Jindal
Aluminium, Bangalore, maintains the famous Naturopathy and Yogi Sciences
Centre and a public school for the benefit of the public. The Jindal scholarship
Trust has been set up, under which deserving students are give scholarships. The
Hindustan Machine Tools has a big playground and a community hall, which are
let out for competitions and functions.
A Study of the approaches to labour welfare is desirable for the management,
the workers and the general reader. For the general reader, a study of approaches
is essential because his/her knowledge of the subject is incomplete without
knowledge of these approaches, and knowledge of approaches enables the manger
and the workers to have a better perspective on welfare work.
Necessity of Social & Industrial Welfare in India:
The signification of welfare measures were Accepted as early as 1931 when
Royal Commission on labour states that the Benefits were of great importance to
the workers which he was unable to secure by himself. The Scheme of labour
welfare may be regarded as a wise investment because these would bring a
profitable return in the form of greater efficiency. The Indian National Congress
passed a Resolution of Fundamental Rights & Economic programme in its Karachi
Session in 1931. Accordingly, the organization of Economic life in the country must
confirm to the principles of justice which will help in securing a decent standard of
living. The State should safeguard the interests of industrial workers and should
secure for them by suitable legislation, a living wage, healthy, conditions of works,
limited hours of work, suitable, machinery for the settlement of dispute between
employees and work man and safe guard against the Economic consequences of old
age, sickness & unemployment.
Types of welfare Factories within and outside the Establishment:
a) Welfare Amenities within the precincts of establishment (Intramural):
Welfare Amenities within the precincts of establishment comprises of latrines
& urinals, washing & Bathing facilities, creche, rest shelters &v canteen,
arrangement for drinking water, arrangements for prevention of Fatigue, health
services including occupational safety, administrative arrangements within a plant
to look after the welfare, uniforms & protective clothing & Shift allowances.
b) Welfare Amenities outside the Establishment (Extramural):
14
Welfare Amenities outside the Establishment include conducting sports,

cultural Activities, library, reading room, holiday homes & Leave travel facilities,
worker’s co-operative including consumer’s co-operative stores, fair-price shops and
Co-operative thrift and credit societies, vocational training for dependants of
workers, other programmes for the welfare of women, youth & children and
transport to and from the place of work to help workers and their families in the
context of their industrial work life.
Principles for successful Implementation welfare programme:
The following principle are to be followed for successful implantation:
1. Pervade the Entire hierarchy of organisation.
2. Not Bargain Labour welfare as a substitute for wage or Monetary Incentives.
3. A Matter of social obligation
4. Helping employers in Long Run.
5. Proper Co-ordination, harmony and Integration.
6. Administratively viable & essentially development oriented
7. Co-operative & Active Participation
8. Periodical Assessment.
Women Labour & Law
Women are known to work on farms, in road and housing construction, and of
late, in factories manufacturing garments and electronic plants. Skilled women
workers also have been working in traditional village industrial either as self
employed or as paid worker. In hill areas, search for forest products including fuel
wood engages a fairly large number of women. The majority of women work in the
unorganized sector for low wages and at low levels of skills. The number of women
workers during the last four decades has more than doubled from 40 million to 90
million. Women constitute a significant part of the workforce in India but they lag
behind men in terms of work participation and quality of employment. According to
Government sources, out of 407 million total workforce, 90 million are women
works, largely employed (about 87 percent) in the agricultural sector as labourers
and cultivators.
Applicability of Labour laws for women
In addition to the Maternity Benefit Act, 1961, almost all the major central
labour laws are applicable to women workers. The Equal Remuneration Act was
passed in 1976, providing for the payment of equal remuneration to men and
women workers for same or similar nature of work. Under this law, no
discrimination is permissible in recruitment and service conditions except where
employment of women is prohibited or restricted by the law. The situation regarding
enforcement of the provisions of this law is regularly monitored by the Central
Ministry of Labour and the Central Advisory Committee. In respect of occupational
hazards concerning the safety of women at workplaces, in 1997, the Supreme Court
of Indian in the case of Vishakha Vs. State of Rajasthan [(1997) 6 SCC 241] held
15
that sexual harassment of working women amounts to violation of rights gender

equality.
As a logiconsequence it also amounts to violation of the right to practice any
profession, occupation, and trade. The judgment also laid down the definition of
sexual harassment, the preventive steps, the complaint mechanism, and the need
for creating awareness of the rights of women workers. Implementation of these
guidelines has already begun by employers by amending the rules under the
Industrial Employment (Standing Orders) Act, 1946. The Factories Act, 1948 has
the following provisions of interest to women (Sections 19, 22(2), 27, 42(1) (b), 48,
66 , 79(1) and 114):
a) Act prohibits women from being employed in cleaning, lubricating or adjusting
certain machinery when it is in motion, if that would expose them to risk of
injury. Women are also not allowed to work in the part of a factory where a
cotton-opener is at work unless certain facilities are met.
b) Suitable sanitation facilities must be provided.
c) If more than 30 women are employed, the employer must proved a free crèche on
the premises for children less than 6 year of age. State Governments may
make rules governing these crèches which may include requirements to
provide clothes washing and changing facilities, child-feeding facilities and free
milk and refreshments for the children.
d) Women cannot be exempted from the requirement that the maximum working
day for adults is 9 hours, and cannot work in factories between the hours of
6am and 7 pm (unless the factory falls within a specific exemption, but in any
case, not between the hours or 10pm and 5 am). In relation to women, there
must not be a change of shifts except after a weekly or other holiday. However,
the State Governments can change these requirement in the fish curing and
canning industries.
e) Periods of absence on maternity leave are included in calculating periods of
service for the purpose of annual leave.
2.4. REVISION POINTS
The welfare facilities can be provided within and outside the Establishment are
called Intramural & Extramural facilities respectively. The Agencies responsible for
labour welfare in India are Directorate General of Human Safety (DGMS), National
Safety Council & Central Labour Institute. The Principles for successful
Implementation of welfare programme include pervading the entire Hierarchy of an
organization, not Bargaining the Labour, Welfare as a substitute for wages a
monetary Incentive, taking it as a matter of social obligation, helping Employees in
Long Run, Proper Co-Ordination, harmony and Integration Administratively viable
& essentially development oriented, Co-operation & Active Participation and
periodical Assessment.
16
1. Discuss elaborately the principles for successful Implementation of welfare

programme.
2. Discuss the Activates of central Labour Institute?
3. Discuss Women Labour & Law?
4. Explain the Duties & Responsibilities of Labour Welfare Officer.
5. What are the Various? approaches to labour welfare?
2.6 SUMMARY
The Importance of Labour in Industrlisation and Economic development has
been recognized globally. In global scenario, the need & Importance of labour
welfare has been increasingly appreciated. Government has laid down minimum
standards for employment and working conditions in organization. Besides the
Government, the Employers, trade unions and various social organization also
function as agencies of labour welfare measures. International Labour Organization
is an Advisory Body and so it cannot force any country to introduce any welfare
measures. The need of Labour Welfare was powerfully felt by the Royal Commission
of labour in 1931. Indian Constitution Emphasized this need under its Directive
Principles of state policy.
1. Discuss Labour Activity in Legal side?
2. What are the provisions available towards Interest of women in factories Act
1948?
3. Discuss employment opportunities and wage disparity based on gender?
1. Report of the Committee of Labour Welfare 1969
2. Annual Report, Ministry of Labour.
3. Report on the National Commission on Labour.
4. Industrial Relations, Labour Welfare & Labour Law By. B.Nandhakumar.
2.9 ASSIGNMENTS
1. Read Kid Kay H.S “The Spirit of Industrial Relations”.
1. Nadhakumar .B, Industrial Relations, Labour welfare & Labour Laws.
2. Tripathi. P.C., Personnel Management & Industrial Relations.
3. Mirza S. Saiyadian, Human Resources Management.
4. www.outsouce2india.com
1. Read the Report on ILO, Asian Regional Conference Report II.
2.12 KEYWORDS
1. Intra mural Fringe Benefits
2. Monetary Incentive Grievance
3. Joint Committees Recruitment

17
LESSON - 3
LABOUR WELFARE AGENCIES - LABOUR WELFARE OFFICER -

QUALITIES OF WELFARE OFFICER
3.1 INTRODUCTION
Organization provide welfare facilities to their Employees welfare schemes can
be classified into two categories - statutory and Non-statutory welfare schemes. The
Statutory schemes are those schemes that are compulsory to be provided by an
organization as compliance to the laws Governing Employee health & Safety. These
include provisions provided in Industrial Acts like Factories Act 1948, Dock
workers Act (Safety, health & Welfare) 1986, Mines Act 1962. The Non Statutory
Schemes differ from organization to organization and from Industry to Industry.
3.2 OBJECTIVES
After going through this chapter you will be able to understand:
 Statutory welfare measures including statutory provisions of welfare work.
 Statutory welfare schemes.
3.3 CONTENTS
Statutory Welfare Schemes
The statutory welfare schemes include the following provisions:
1. Drinking water At all the working places, safe hygienic drinking water should
be provided.
2. Facilities for sitting In very organization, especially factories, suitable
seating arrangements are to be provided.
3. First-aid appliances First-aid appliances are to be provided and should be
readily accessible so that in case of any minor accident, initial medication can
be provided to the needed employee.
4. Latrines and urinals A sufficient number of latrines and urinals are to be
provided in the office and factory premises and are also to be maintained in a
neat and clean condition.
5. Canteen facilities Cafeteria or canteens are to be provided by the employer so
as to provide hygienic and nutritious food to the employees.
6. Spittoons In every work place, such as warehouses, store places, in the dock
area and office premises spittoons are to be provided inconvenient places and
some are to be maintained in a hygienic condition.
7. Lighting Proper and sufficient lights are to be provided for employees so that
they can work safely during the night shifts.
8. Washing places Adequate washing places such as bathrooms, wash basins
with tap and tap on the stand pipe are provided in the port area in the vicinity
of the work places.
9. Changing rooms Adequate changing rooms are to be provided for workers to
change their clothes in the factory area and office premises. Adequate lockers
are also provided to the workers to keep their clothes and belonging.
18
10. Rest rooms Adequate numbers of restrooms are provided to the workers with
provisions of water supply, wash basins, toilets, bathrooms, etc.
The following are also some of the Labour welfare Amenities and services
provided to the employees as per the Law. They are washing facilities, facilities for
storing and drying clothes, facilities for setting, first aid appliances, shelters, rest
rooms and lunch rooms, canteen & creche facilities.
1. Washing facilities
The Royal commission on Labour recommended that for the workers engaged
in dirty processes, suitable washing place and water should be compulsorily made
available.
The Mines Rules 1955, provides the following
1. Where a piped water supply is available, a sufficient number of water taps,
conveniently accessible shall be provided in or near Latrines.
2. If piped water supply is not available, a sufficient quantity of water shall be
kept in store at suitable receptacles near latrines.
Section 42 of factories act lays down the following:
In every Factory:
 Adequate suitable facilities for washing shall be provided.
 Separate & adequate screened facilities be provided for male & female workers.
 Facilities should be accessible & clean.
Sec 18(c) of Contract Labour (Regulation & Abolition) Act provides that it the
duty of contractor to provide & maintain washing facilities for contract labour
connected with work of an establishment.
2. Facilities for storing & drying clothes
Such provision is incorporated only in Factories act. Under Sec.43 of the Act,
A State Government many make Rules for the Provision of suitable places for
keeping clothes not worn during working hours and for drying of wet clothes. As
per Maharastra Factory Rules 1963, such Facilities include the provisions of
separate rooms, pegs, lockers or other such arrangements approved by Chief
Inspector for factories such as Engg. workshops, Iron & steel works, Oil Mills,
chemical factories, motor garages etc.,
3. Facilities for sitting
Sec 42 of Factories Act
 In every factory, suitable arrangements for sitting shall be provided and
maintained for all workers obliged to work in standing position.
 If in an opinion of Chief Inspector, the workers in any factory engaged in
manufacturing process are able to do their work efficiently in sitting position,
he may, by order in writing, require the occupier of the factory to provide before
a specified date sitting arrangements for all workers.
19
 The State Government may by Notification in official Gazette declare that

provisions of subsection (1) shall not apply to any specified factory or to any
specified manufacturing process.
4. First Aid Appliances
Sec 42 of the factories Act provides the following:
a) There shall in every factory be provided & maintained and readily accessible
during all working hours, First Aid Boxes. The number should not be less than
one for every one hundred & fifty workers employed (at anyone time) of factory.
b) Each first aid box shall be kept in charge of a separate responsible person who
shall be readily available.
c) In factory wherein more than five hundred workers there shall be provided and
maintained an Ambulance room and nursing staff with prescribed equipment.
Sec 21 of Mines Act provide the following
 In every mine - there shall be provided and maintained, readily accessible
during all working hours, number of First Aid Boxes.
 The provision of Sec. 42 of Factors Act (b) and (c) mentioned above is
applicable in Mines Act also.
 Sec 12 of Motor Transport workers Act 1961 has laid down the following
statutory obligations on the part of the employer
 The (a) & (b) & (c) Mentioned Factories Act is applicable for this also.
d) The First Aid Box shall be kept in charge of Driver or conductor of the
Transport vehicle.
5. Shelters, Rest rooms & Lunch Rooms
Sec 42 of the Factories Act:
1) Ina factory
a) Where in more than 150 workers are employed, adequate and suitable
shelters, suitable lunch rooms with provision for drinking water shall be
provided.
b) Provided that canteen maintained accordance with provisions of Sec. 46.
c) Provided where there is lunch room, no worker shall eat any food in the
work room.
2) The shelters / Rest room shall be sufficiently lighted & ventilated.
Sec. 9 of Motor Transport Workers Act 1961. Provides the following:
1. In every places wherein Motor Transport workers employed in Motor
Transport undertaking are required to halt at Night, there shall be provided
and maintained by the employer, Provide adequate number of Rest Rooms or
suitable alternative accommodation be made.
2. The rest rooms should be sufficiently lighted, ventilated, clean & comfortable
condition.
Sec 17 of contract labour (Regulation & Abolition) Act 1970 provide the following provisions.
20
i) provide adequate rest rooms or suitable alternative arrangements where

contract labour is required to halt in connection with work.
ii) The rest rooms should be sufficiently lighted, ventilated, clean & comfortable
condition.
6. Canteen
Sec 46 of the Factories Act lays down the following:
i) In factories wherein more than 250 workers are ordinarily employed a
canteen shall be provided.
ii) Sec 11 of plantations labour Act 1951; In every plantation where in 150
workers are ordinarily employed, one or more canteen shall be provided.
Sec 16 of contract labour act provides the following
 Where contract labour numbering 100 or more employed by contractor one or
more canteen shall be provided.
 Sec 8 of Motor Transport Workers Act provides the following wherein one
hundred or more Transport workers employed one or more canteen shall be
provided.
 Mines Rules specifies that wherein more than 250 persons are employed a
canteen adjacent to the precincts of the Mine shall be provided.
7. Creche Facilities
Creche Facilities are extended for all the contract workers by contract Labour
Central Rules 1971.
It provides that in every establishment where 20 or more women are ordinarily
employed they must be provided Two rooms for use of their children under the age
of 6 years. One such room can be used as play room & other as sleeping room.
 Sec 48 of Factories Act: For setting up creche in every factory wherein more
than 30 women workers are employed.
The rooms should be adequately lighted & ventilated.
 Sec 12 of Plantations Labour Act: Providing creche in Plantation workers where
in 50 or more women works are employed.
3.4 REVISION POINTS
Statutory welfare measures include statutory provisions for welfare work
which depend for their implementation on the coercive power of Govt. The
Government Enacts certain rules of labour welfare to conform to minimum
standards of health & safety of workers. The employers are required by law to fulfill
their statutory obligations on welfare. Every country is gradually increasing its
statutory control over Labour welfare of their workers on voluntary basis.
1. Elaborate on creche facilities under Factories Act, Plantation Labour Act.
2. Discuss the First Aid Facilities under Factories Act, Mines Act & Motor
Transport workers Act.
21
3. List out the various Labour welfare Amenities &Services provided to employees
as per the law.
4. Discuss the Facilities for storing & drying clothes under Factories Act.
3.6 SUMMARY
Statutory welfare Facilities include statutory provisions for welfare work which
depend for their implementation on the coercive power of the Government. The
statutory welfare Facilities provided under Factories Act 1948, Plantation Labour Act
1951, Mines Act 1952, Motor Transport workers Act 1961 & contract Labour
(Regulation & Abolition) Act 1970 are washing facilities, facilities for storing & drying
clothes, sitting, First Aid Appliances, Shelter / Rest room & lunch rooms & canteen.
3.7 TERMINAL EXERCISE
1. Labour welfare and social security measures are also known as Hidden pay
roll.
2. Under Factories Act (Sec 48) setting up of creche is possible only when more
than 30 women workers are employed.
3. Explain the legal obligation of employer for providing facilities for storing &
drying clothing.
4. Give an account of labour welfare amenities and services provided by
employer especially in an organized sector of an industry.
XYZ is engaged in Manufacturing of soft leather articles for export market. Due to
expansion of trade, the company decides to recruit some Additional workers. However
the company decides that women worker will be paid only half the wage of male
workers. The company also decides not to agree to provide Educational, Medical,
Transport, Recreational & housing facilities like those for the existing workers in the
company.
Comment on the legality of above decision.
3.9 ASSIGNMENTS
Prepare Answers for
1. What are the main objectives of a consumer store
2. Comment on the standards of canteen, furniture & equipments & cleanliness
in such canteen?
3.10 SUGGESTED READING / REFERENCE BOOKS
1. Gankas, “Industrial Relations in India”.
2. Dale S. Beach “Personnel - The Management of people work”.
3. Business Today.
4. Ibid., P.426.
1. Discuss the Recommendation of The committee on Labour welfare for
improvement of canteen services.
3.12 KEY WORDS
1. Recreational
2. Statutory
22
3. Amenities
4. Provisions
5. Abolition
6. Chief Inspector

23
LESSON - 4
GROWTH & CONCEPT OF LABOUR WELFARE IN INDIA

4.1 INTRODUCTION
The Impetus given to welfare work during the post world war period was
caused by the necessity the maintain the good will of the large and rather freshly
recruited war time labour force and to gear them to increase production. After II
world war both Central & State Governments evinced more interest in undertaking
welfare work for workers. After independence the labour welfare movement acquired
new dimension. Now, labour welfare activities are organized to attract better and
qualified workers.
4.2 OBJECTIVES
 After reading this chapter you should be able to understand:
 Developments in Labour Welfare in India
 Developments in Labour Welfare during world war
 The present scenario of Labour welfare
 Various concepts or philosophy of Labour welfare
4.3 CONTENTS
Historical Development / Evolution of Labour welfare in India
Welfare work in India was mainly a product of the stresses and strains during the
First World War. Before this period, there were only isolated instances of welfare work
mostly by outside agencies on humanitarian ground. The impetus given to welfare
work during the post world war period was caused by the necessity to maintain the
goodwill of the large and rather freshly recruited war time labour force and to gear
them to increase production. Further the industrial expansion and the concomitant
processes of mass production led to the rise of working class as a source of power.
The movement to improve the working conditions of Indian labour stared with the
passing of the first Indian Factories Act in 1881. The deplorate during those days, as
testified by factory commission of 1875 was the immediate cause for the passing of the
act. The act applied to factories employing not less than 100 persons and using power.
Under this act, the employment of children below the age of 7 years as prohibited,
while those between 7, 8, 12 years were not to work for more than 9 hours a day. An
hour’s daily rest and 4 holidays in a month were prescribed for children.
During the First World Ware, the number of factories and the number of
factories and the number of persons employed therein increased. Wages did not
keep pace with the rising prices and profits. The working class became more
conscious as a results of the general interest following the war. The establishment
of ILO in 1919 was an important landmark in the history of labour welfare
movement in our country. The ILO declared that universal peace can be established
only if it is based upon social justice.
After the end of Second World War, both the Central and state governments
evinced more interest in undertaking welfare work for workers. While the central
24
government also persuaded employers to improve their welfare schemes, there was
no notable difference in their attitudes.
In May 1944, the general charter of labour, particularly known as the
declaration of Philadelphia, was adopted by the member states of the ILO. Amongst
its aims and objective, the declaration said that labour is not a commodity and that
it is entitled to a fair deal as an active participant in any programme of economic
development or social reconstruction.
After independence, the labour welfare movement acquired new dimension. It
was realized that labour welfare had positive role to play in increasing productivity
and reducing industrial tensions. The state began to realize its social
responsibilities towards weaker sections of the society.
The constitution of India contains a list of fundamental rights and directive
principles of state policy for the achievement of social order based on justice,
liberty, equality and fraternity. It lays down that the state shall strive to promote
the welfare of the people by securing and protecting as effectively as may a social
order in which justice, social, economic and political shall inform all the
institutions of national life. In its specific application to the working classes
securing just and humane conditions of work has been highlighted with a view to
ensure them provision of a decent standard of life and full enjoyment of leisure and
social and cultural opportunities. These principles refer to the taking of the steps to
secure the participation of workers in the management of industries. Article 45 also
deals with provision of free and compulsory education for children which impliedly
included those of workers.
Various labour welfare activities were incorporated in different five year plans.
The first five year plan (1951-56) paid considerable attention to the welfare of the
working classes. It laid emphasis on the development of welfare facilities and
avoidance of industrial disputes and creating mutual goodwill and understanding.
During this period, the Plantations Labour Act 1951, the Mines act 1952 and
Employee’s Provident Fund Act 1952 were enacted. A subsidized housing scheme
for industrial workers was evolved in 1952.
The second five year plan recommended undertaking a comprehensive survey
of welfare activities. It was expected that such survey would provide a
comprehensive picture of changes taken place in respect of different aspects of
labour welfare and thereby serve a useful purpose for future assessment and
formulation of policies.
The third plan reiterated the proposition made in the earlier plans the
legislation enacted for the protection, safety and welfare of workers was adequate
and better enforcement was all that was needed.
The fourth plan without making any specific reference to the labour welfare
stressed that welfare within the establishment is a prerequisite for work efficiency.
25
The fifth five year plan also laid down programmes for labour welfare for
promoting industrial safety in increasing measure, the plan provided for labour
welfare including craftsman training and employment service.
The sixth, seventh and other five year plans also emphasized very much on
labour welfare, improvement in working and living conditions of unorganized labour
not only in the rural areas but also in the urban areas.
Labour welfare activities are organized also to attract better and qualified
workers. Such activities have made it possible for employees to persuade workers to
accept show off and advertise their concern for labour welfare by organizing labour
welfare activities. Thus, it can be said that the motive behind welfare activities are
often complex, for the belief varies from person to person. There are seven
approaches to the philosophy of theory of labour welfare. These are:
1. Philanthropic theory
2. Religious theory
3. Paternalistic or trusteeship theory
4. Public relations theory
5. The functional theory
6. The policing theory
7. Placating theory
a) Philanthropic Theory
Philanthropic, means loving mankind. The philanthropic theory is based on
man’s love for mankind. Man is believed to have spontaneous urge to better the lot
of his fellow beings. For this reason man strives to remove suffering of others and
promote their well beings. Explained from this point of view, labour welfare
activities could be act of pity on the part of employees who want to remove the
sufferings to their workers. The labour welfare movement began in the early years
of industrial revolution with the support of Robert movement began in the early
years of industrial revolution with the support of Robert Owen, philanthropist in
India, Mahatma Gandhi, Lokhande, B.P. Wadia were well known philanthropists
who stroke for the welfare of the workers.
b) Religious Theory
Many human behaviours are influenced by religious sentiments and beliefs.
Owners, as human beings do subscribe to religious sentiments and beliefs. These
religious feelings, sometimes prompt an employer to take up welfare activities in the
expectation of future benefits in this life and in future life. And closely allied to this
religious theory, we could also recognize the atonement theory. According to this
theory, some employers are prompted to take up welfare activities in a spirit of
atonement for their sins.
This theory prefers the idea that man is primarily concerned with his own
welfare and only secondarily with the welfare of others. The religious basis of
welfare, however, cannot be rational. It is neither universal nor continuous.
26
c) Paternalistic or trusteeship Theory

According to this theory, the industrialists or the employers hold the total
industrial estate, properties and profits accruing from them in trust. He holds the
property not only for his but also for the benefit of his workers. Another assumption
of this theory is that the workers are like minors; they are ignorant because of lack
of education and are not able to look after their own interests. Owners, therefore.
have the moral responsibility to look after the interests of their workers. Though,
the trusteeship has no legal sanction, it is very much existent.
d) Public relation theory
According to this theory, labour welfare activities are organized by the
employers to create goodwill between workers and management and between
management and public. Labour welfare programmes work as a sort of an
advertisement and help employees to build up good and healthy public relations.
Publicity of labour welfare programmes helps an industrialist to project to the
public a good image of his company.
Thus, for instance, several companies do have expensive sports activities and
maintain a sports team. These teams and their periodical competitions and names
of the companies appear in popular newspaper. It is believed that such frequent
presentation of the company’s name before public creates a favourable image of the
company.
e) The functional theory
This theory is also called as efficiency theory. According to this theory welfare
activities are undertaken to secure, preserve and develop the efficiency and
productivity of workers. It is obvious that if an employer undertakes welfare
activities for his workers, they will tend to become more efficient and will thereby
increase productivity. Consequently, the workers, they will tend to become more
efficient and will thereby increase productivity. Consequently, the workers will get
better wages and incentives and the management will get higher profits. This is the
functional aspect of welfare having efficiency as its objects, which in turn increases
productivity.
This theory works very well if both the parties have identical aim in mind, that
if higher production through better welfare.
In India, industrialists by and large, adhere to the paternalistic approach.
Some owners, however, undertake welfare activities because of stringent laws. But
in many aspects, the functional theory of labour welfare works more effectively by
reason of an intelligent and willing participation of workers.
f) The policing theory
This theory is based on the assumption that the man is selfish and self-
centered and always to achieve his own end, even at the cost of welfare of others
particularly if he is placed in an advantageous position, by reason of wealth or
authority.
27
According to this view, the factory provides ample opportunities for owners to
exploit workers. The state has, therefore, to step in to prevent this kind of
exploitation and coerce owners to offer minimum standard of welfare facilities to
their workers.
Laws are enacted and enforced to compel the owners to provide congenial
working conditions. The policing theory therefore, prescribes:
a) Passing of laws requiring employers to provide for the welfare of the workers/
b) Periodical supervision to ascertain that these welfare measures are provided
and
c) Punishment of employers in case of neglect or disobedience of the law.
g) The Placating Theory
The basic assumptions behind this theory are workers are becoming conscious
of their right and privileges and they are welding themselves into more powerful,
demanding and militant groups than ever before. The workers demands can no
longer be ignored. Therefore, it is necessary to appease the workers. This could be
done by taking up timely and periodical welfare activities. The welfare activities are
considered as pacifiers. This is also the best means of securing workers’ co-
operation.
4.4 Revision points
The movement to improve the working conditions of Indian Labour started
with passing of first Indian Factories Act 1881. The establishment of ILO in 1919
was an important Landmark in the history of Labour welfare movement in our
country. The ILO declared that universal peace can be established only if it is based
upon social justice. In May 1944, ILO declaration was an Landmark which stated
that labour is not a community and that it is entitled to fair deal as an Active
Participant in any programme of Economic Development Social Reconstruction
Various Labour Welfare Activities were incorporated in different five year plans.
Thus it can be said that the Motive Behind Welfare Activities are often complex for
the belief varies from person to person.
1. Discuss the functional theory of Labour welfare
2. What are the various incorporations with regard to Labour Welfare Activities
in different five year plans?
3. Elaborate on the policing theory of Labour Welfare
4. Discuss the Application of constitution of India for working class with respect
to labour welfare.
4.6 SUMMARY
The movement to improve the working condition of Indian Labour started with
passing of First Indian Factories Act in 1881. The establishment of ILO in 1919 was
an important landmark in the history of labour welfare movement in our country.
After Independence, Labour welfare had positive Role to play in increasing
productivity & reducing Industrial Tensions. Various Labour Welfare Activities were
28
incorporated in different five year plans. Labour welfare Activities are organized also
to attract better and qualified workers.
1. Discuss the placating theory of Labour welfare.
2. Compare the Factories Act 1948 of India with other prominent developing
countries act.
1. ILO payment by Results, Oxford & IBH
2. Agarwal S.L, Labour Relations in India
3. R.Chandrasekhar, “The Buck stops here”
4. Charles R.Greer Op. Cit.,
5. The Economic Times
4.9 ASSIGNMENTS
1. Discuss the Restrictions in Factories Act 1948 relating to employment of child
& women workers of different countries.
1. John Bratton & Jeffrey gold, Human Resources Management
2. Randall S.Schuler, Effective Personnel Management
3. Industrial Relations. Labour Welfare & Labour Laws By B.Nandhakumar
1. Discuss the development of Labour welfare in Countries like Pakistan,
Srilanka.
4.12 KEY WORDS
1. Economic Development
2. Functional Theory
3. Labour welfare
4. Social Reconstruction
5. Trusteeship
6. Philanthropic

29
UNIT - II
LESSON - 5
TERMINOLOGY, MEANING, HISTORY AND GROWTH OF FRINGE

BENEFITS IN INDIA
5.1 INTRODUCTION
Fringe Benefits are valued at fair market value. This is the amount the
employee would pay the same benefit in a their-party, arms-length transaction.
These are considered as supplementary form of compensation. These are sometimes
indirect compensation organizations vary themselves in providing variety of Fringe
Benefits.
5.2 OBJECTIVES
After reading this chapter you will become familiar with
 What are fringe benefits?
 Breakdown fringe benefits and valuing it.
 History of fringe benefits and objectives.
5.3 CONTENTS
What are “Fringe Benefits”
Fringe benefits are benefits provided by an employer to an employee,
independent contractor or partner, some of which are tax-exempt when certain
conditions are met. Recipients of taxable fringe benefits have to include the fair
market value of the benefit in their taxable income for the year.
 The terms fringe benefits refers to the extra benefits provided to employees in
addition to the normal compensation paid in the form of wage or salary. Many
years ago, benefits and services were labeled “fringe” benefits because they
were relatively insignificant of fringe components of compensation. However,
the situation now is different, as these have, more or less, become important
part of a comprehensive compensation package offered by employers to
employees.
Breaking down “Fringe Benefits”
Fringe benefits commonly include health insurance, group-term life
insurance coverage, educational assistance, childcare and assistance
reimbursement, cafeteria plans, employee discounts, employee stock options,
personal use of a company-owned vehicle and others. Whether a fringe benefit is
tax-exempt depends on the type and, in some cases, the value of the benefit. By
default, all fringe benefits are taxable unless they are specifically named as being
tax-exempt.
Tax-Exempt Benefits
Benefits that are exempt from income tax include the following:
 accident and health benefits
 achievement awards
30
 adoption assistance
 athletic facilities
 de minimise benefits
 dependent care assistance
 educational assistance
 employee discounts
 employee stock options
 employer provided cell phones
 group-term life insurance coverage
 health savings accounts (HSA)
 lodging on business premises
 meals
 moving expenses reimbursements
 no-additional-cost services
 retirement planning services
 commuting benefits
 tuition reduction
 work conditions benefits
All of these exemptions are subject to certain conditions. For example,
achievement awards are only exempt up to a value of $1,600 for qualified plan
awards and a value of $400 for non-qualified plan awards. For moving expenses,
the new job location must be at least 50 miles farther away from the employee’s old
home than the old job location. Some exemptions are not available to highly
compensated employees if the benefits favour them over other employees; these
include employee discounts, adoption assistance and dependent care assistance.
Most fringe benefits that are income tax-exempt are also exempt from Social
Security, Medicare and Federal Unemployment taxes, but not all: adoption
assistance is exempt from income tax only, for example.
Any fringe benefit not named above, or any of the benefits named above which
does not conform to the IRS’s rules for exemption, is taxable. Working condition
benefits are taxable to the extent that they are for personal use. For example, if an
employee receives a company computer, their taxable income would include the
computer’s fair market value multiplied by the proportion of time they devote to
personal use. If they only use it for business purposes, there’s no additional taxable
income. If 80% of their use is personal, their taxable income must include 80% of
the value of the computer.
Valuing Fringe Benefits
In general, fringe benefits are valued at fair market value. This is the amount
the employee would pay for the same benefit in a third-party, arms-length
transaction. All relevant circumstances, such as geographic area and current
31
market conditions, must be taken into account. The fair market value may be
different from the actual cost to the employer of providing the benefit; this fact does
not affect the valuation.
Valuing the use of a company vehicle is more complicated. Using the fair
market value is one option. If the car could have been leased on a cents-per-mile
basis, the miles driven can be multiplied by an IRS-determined standard cents-per-
mile rate (56 in 2014). If the employer sponsors a ride-sharing program, three or
more employees regularly commute to work in a company vehicle, and the
employees are not allowed to use the vehicle for personal reasons, the employer can
use a rate of $1.50 per employee per commute. Under certain circumstances, the
employer can use a daily or prorated annual lease value determined by the IRS.
The important objectives of fringe benefits are
a) To motivate the employees by identifying and satisfying their unsatisfied
needs.
b) To create and improve sound industrial relations.
c) To protect the health of the employees and to provide safety to the employees
against accidents.
d) To provide security to the employees against social risks like old age benefits
and maternity benefits.
e) To create a sense of belongingness among employees and to retain them.
Hence, fringe benefits are called golden handcuffs.
f) To promo the employees’ welfare.
The main features of fringe benefits, may be stated as under:
a) They are paid to all employees (unlike incentives which are paid to specific
employees whose work is above standard) based on their membership in the
organization.
b) They are supplementary forms of compensation.
c) They help raise the living conditions of employees.
d) They are indirect compensation because they are usually extended as a
condition of employment and are not directly related to performance.
e) They may be statutory or voluntary. Provident fund is a statutory benefit
whereas transport is a voluntary benefit.
History of fringe benefits
Next to wages, fringe benefits are the most important method businesses use
to entice workers to accept or stay in jobs. Fringe benefits, also known as
“employee benefits”, can be provided voluntarily by employers, required by law, or
won through collective bargaining negotiations between companies and employees.
Fringe benefits can be generally divided into those offered individually, such as
401(k) retirement plans, and those offered to employees as a group, such as
daycare facilities or free lunch. Most employee benefit plans traditionally offered
three basic benefits: health insurance, a retirement plan or pension, and additional
benefits, such as stock option plans or life insurance. A crucial advantage of fringe
32
benefits to businesses was the Internal Revenue Service (IRS) allowed firms to
deduct benefits as an employee compensation expense from the taxes they owe.
Similarly while employees had to pay taxes on any increases in their salaries, their
benefits were not taxed.
In the late 1990s, medical benefits and flex-time -- allowing workers to choose
their daily work schedules -- were the two most important fringe benefits for U.S.
job seekers. medical benefits comprised the single most costly benefit for
employers. A special class of fringe benefits were “perks” (short for perquisites),
which were usually offered only to senior-level employees. Perks included mobile
car phones, executive parking, company cars, and even chauffeured limousines of a
company jet.
In the United States, fringe benefits became much more common after
collective bargaining became common in the 1930s and 1940s, giving workers the
power to persuade businesses to improve working conditions. During World War II
(1939-1945), government-mandated wage and price controls prevented companies
from giving raises, so they relied on fringe benefits to recruit and reward employees.
Fringe benefits accounted for 17 percent of the total compensation of blue-collar
workers by 1951, and 30 percent by 1981. In the 1980s employee benefit reforms
introduced by president Ronald Reagan (1981-1989) had the unintended effect of
complicating the national fringe benefits systems, and in the 1990s innovations like
customizable “cafeteria” health, insurance, vacation plans, and SIMPLE (Savings
Incentive Match Plan for Employees) benefits simplified benefits choices. During the
tight job market of the 1990s, employers began offering a more creative mix of
fringe benefits, including club memberships, legal services, home offices, and
errand services. Among the most sought-after benefits were stock options, or shares
in an employer’s stock. During the stock market boom of the 1990s some fast-
growing companies boasted that their stock options had turned secretaries and
other non-management workers into millionaires.
Fringe benefits in India
A fringe benefit is a form of pay for the performance of services. For example,
you provide an employee with a fringe benefit when you allow the employee to use a
business vehicle to commute to and from work. Although generally voluntary, some
of the most important “fringe” benefits include health insurance, retirement plans
and paid time off. Information regarding these benefits is covered in the Health
Insurance, Retirement Plans and Leave and Time Off sections. Fringe benefits
covered in this section include:
 Flexible Hours
 Transportation Benefits
 Bonuses
 Severance
 Adoption Assistance
 Childcare Assistance
33
 Educational Assistance
 Employee Assistance Programs (EAPs)
 Life Insurance
 Long-Term Care Insurance
 Company Vehicles
5.4 REVISION POINTS
Fringe benefits refers to extra benefits provided to employees in addition to the
normal compensation paid in the form of wage or salary. Fringe benefits include
health insurance, group-term life insurance coverage, educational assistance, child
care and assistance reimbursement etc. There are also certain Fringe Benefits
which are Tax-exempted. There are various objectives of fringe benefits. There are
various features of fringe benefits.
Administration of Fringe Benefits (Model)
Sl. Grade of
Particulars Processing Authority Sanctioning Authority Remarks
No. Employee
1. House Rent Assessment All Grade of RHRD / Admin. Dept (Of Administrative Head of the Standing Committee should
Officers respective location or HO location / region not below comprise of three officers in
as the case may be) General Manager on the Grade D and above having
recommendation of the relevant background
Standing Committee including that from associated
Finance and RHRD / Admin
2. Company-Leased /
owned accommodation
a) Permission for Officers up to RHRD / Admin. Dept Administrative Head of the
allotment of Grade G location not below General
accommodation Manager
Grade H & Above RHRD / Admin Dept. Reporting officer, viz.

ED/Dir/MD (as the case
may be)
b) Leasing of Co. Up to Grade G RHRD / Admin. Administrative Head of Rent assessment to be done
accommodation Dept location not below the by the duly constituted
level of GM. Standing committee
Officers in H & RHRD / Admin. Reporting officer, viz.
above Dept ED/Dir/MD (as the case
may be)
3. Sanction of loans and
Advances in accordance
with Company policies
a) Sundry loan Upto Grade G RHRD GM Concurrence of Associated
Finance and RHRD
Sl. Grade of
No. Employee
Grade H & above RHRD Controlling Officer Concurrence of SBU Head
of Finance and SBU Head of
RHRD
34
Sl. Grade of
No. Employee
b) House Building Loan All Grades RHRD (to be routed Committee consisting of
through CHRD & C) CS / Head of Legal,
ED(HR), GM(F) and
concerned ED reporting to
MD / Dir
c) Car Loans Officers in Grade RHRD MD With concurrence of ED
B&C (HR) and SBU Head of
D and above RHRD ED / Dir Finance
d) Two-wheeler Loans All grades RHRD GM
e) Second Loan before All grades of RHRD MD
completion of 5 years officers
RHRD Controlling Officer not
below rank of GM With concurrence of
Associated Finance and
f) Car/two wheeler repair All grades of RHRD
loan officers
g) Salary Advance All grades RHRD Controlling Officer not
below Officer Grade D
h) Medical advance as per All Grades Based on estimated
Company policy Upto Rs.30,000/- RHRD GM expenditure provided by
Upto Rs.50,000/- RHRD Dir Hospitals / Nursing Homes
or CMA.
Beyond RHRD MD
Rs.75,000/-
4.1 Approval of medical / All Grades
hospital bills in each case Upto Rs.30,000 RHRD GM
as per company’s rule
Upto Rs.50,000 RHRD ED
Upto Rs.75,000 RHRD Dir
Upto Rs.1,00,000 RHRD Committee of Director- To be routed through
In-Charge of SBU / ED(HR)
Function and D(F)
Above Rs.1,00,000 RHRD Committee of Director-In- To be routed through
Charge of SBU/Function ED(HR)
and D(F) and MD
4.2 Reimbursement of All Officers upto RHRD Controlling
medical expenses (other Grade G Officer in Grade D &
than hospitalization as per above
company’s rules
Grade H & above RHRD Self sanctioning
5 Purchase of Briefcase All eligible RHRD Controlling Officer in Within the applicable
Officers Grade entitlements
D and above
Sl. Grade of
No. Employee
6 Membership fees for Officers of all RHRD Controlling Officer in Within the applicable
approve professional Grades Grade D and above entitlements
institutes
7 Furniture & Equipment at All Grades of RHRD Controlling Officer not Within the applicable
residence and home PC Officers below the rank of GM entitlements
as per company rules
35
Sl. Grade of
No. Employee
8 Soft furnishings E and above RHRD Controlling officer not Within the applicable
below the rank of GM entitlements
9 Car running expense on
annual mileage basis
i) To approve limit of Grade B&C RHRD MD
With concurrence of
entitlement
concerned Dir and ED(HR).
Grade D & above RHRD Dir
ii) Reimbursement of All grades RHRD Controlling officer
monthly maintenance in
/ running expenses Gr. D & above
10 Two-wheeler running All Grades RHRD Controlling officer not
expense below GM
i) To approve limit for All Grades RHRD
entitlement as per
applicable co. rules
ii) Reimbursement of All Grades RHRD Controlling officer in Gr. D
monthly maintenance / & above
running expenses
11 i) Sanction for All Grades RHRD ED / Dir To be routed through
reimbursement of two CHRD&C
wheeler running
expenses of actual
mileage basis
Grade B&C RHRD MD
ii) Sanction for Grade D & above RHRD Dir With concurrence of
reimbursement of car concerned Dir and ED (HR).
running expenses on
actual mileage basis
iii) Reimbursement of All Grades RHRD Controlling officer in Gr. D
maint./ running & above
expenses on actual
mileage for car two
wheeler
RHRD Controlling Officer in
Grade D and above
12. Leave encashment All Grades RHRD Controlling officer in
Gr. & above
Notes
1. The Manual of Service Terms, and administrative instructions issued from
time to time will govern sanction of allowances / fringe benefits not included
in the DOA.
2. This DOA will over-ride any deviation from the above delegations as existing on
the date of implementation of this DOA. Any clarification and / or significant
contradiction must be referred to MD through ED (HR) for their decision.
3. In officer of appropriate status in RHRD / Admin / A&F is not available in a
particular location, then the senior most officer of that department in the
location will discharge the responsibility.
1. Discuses the history of fringe benefits?
36
2. What are the objectives of fringe benefits?

3. Discuss the main features of fringe benefits?
4. How does companies value Fringe Benefits?
5.6 SUMMARY
Next to wages Fringe Benefits are the most important method businesses use to
entire workers to accept or to stay in jobs fringe benefits are benefits provided by an
employer to an employee, independent contractor or partner. Some fringe benefits are
Tax exempted valuing the fringe benefits are an important method followed by
organisations. Fringe benefits is a form of pay for the performance of services.
1. “The Fringe Benefits raise the living condition of employees”. Discuss.
2. Fringe Benefits create and improve _______________ (Industrial Relations /
Supplier Relations)
3. Fringe Benefits promotes ______________ Employee welfare / Employer welfare.
4. Fringe Benefit is a form of __________ for the performance of services (pay /
free service)
5. “Fringe Benefits are supplementary forms of compensation” Discuss.
1. Industrial Relations Labour welfare and Labour laws by B.Nandakumar
2. Agrawal, S.L.Labour Relations in India.
3. E.A. Ramaswamy., OP Cit. P.250
5.9 ASSIGNMENTS
1. Surf the Net. Bring out the list of fringe benefits provided by Indian
Companies and multinational companies to their employees?
2. List out the Fringe Benefits provided by Govt. companies and private
companies in India for their employees.
3. Prepare a list of fringe benefit which are Tax exempted and taxable one in India.
1. David Decenzo and Stephen P.Robbins “Personnel management” Third
Edition: Prentice Hall of India, New Delhi.
2. Myers. CA and Kanappan, Industrial Relations in India - 1070
3. Kudchedkar L.s., “Aspects of Personnel Management and Industrial Relations” 1979.
1. Compare and contrast Fringe Benefits in India.
2. Discuss the impact of Fringe Benefits in Indian Economy?
5.12 KEY WORDS
1. Golden Hand cuffs
2. Compensation
3. Company vehicle
4. Bonuses
5. Severance

37
LESSON - 6
COVERAGE OF BENEFITS - ADMINISTRATION OF BENEFITS AND

SERVICES - PROBLEMS - TYPES OF FRINGE BENEFITS
6.1 INTRODUCTION
Organisation provide variety of fringe benefits. These are classified under
various heads. Administration of fringe benefits can be done according to the Grade
of employee, processing authority, sanctioning authority. The various things are
HRA, company owned / leased accommodation, sanction of loans, approval of
medical bills, reimbursement of medical expenses etc.
6.2 OBJECTIVES
After reading this chapter you will understand about
 Types of Fringe Benefits
 Administration of Fringe Benefits and its remarks.
 Coverage of benefits based on grade of employee.
6.3 CONTENTS
Types of fringe benefits
Organizations provide variety of fringe benefits. The fringe benefits are
classified under four heads as given here under:
1. For Employment Security
Benefits under this head include unemployment, insurance, technological
adjustment pay, leave travel pay, overtime pay, level for negotiation, leave for
maternity, leave for grievances, holidays, cost of living bonus, call-back play, lay-
off, retiring rooms, jobs to the sons/daughters of the employees and the like.
2. For Health Protection
Benefits under this head include accident insurance, disability insurance,
health insurance, hospitalization, life insurance, medical care, sick benefits, sick
leave, etc.
3. For Old Age and Retirement
Benefits under this category include: deferred income plans, pension, gratuity,
provident fund, old age assistance, old age counseling, medical benefits for retired
employees, traveling concession to retired employees, jobs to sons/daughters of the
deceased employee.
4. For Personnel Identification, Participation and Stimulation
This category covers the following benefits: anniversary awards, attendance
bonus, canteen, cooperative credit societies, educational facilities, beauty parlour
services, housing income tax aid, counseling, quality bonus, recreational programs,
stress counseling, safety measures etc.
The fringe benefits are categorized as follows
a) Payment for time not worked
Benefits under this category include: sick leave with pay, vacation pay, paid rest
and relief time, paid lunch periods, grievance time, bargaining time, travel time etc.
38
b) Extra pay for time worked

This category covers the benefits such as: premium pay, incentive bonus, shift
premium, old age insurance, profit sharing, unemployment compensation,
Christmas bonus, Deewali or Pooja bonus, food cost subsidy, housing subsidy
recreation.
Employee Security
Physical and job security to the employee should also be provided with a view
to promoting security to the employee and his family members. The benefit of
confirmation of the employee on the job creates a sense of job security. Further a
minimum and continuous wage or salary gives a sense of security to the life.
Retrenchment Compensation
The Industrial Dispute Act, 1947 provides for the payment of compensation in
case of lay-off and retrenchment. The non-seasonal industrial establishments
employing 50 or more workers have to give one month notice or one month wages
to all the workers who are retrenched after one year continuous service. The
compensation is paid at the rate of 15 days wage for every completed year of service
with a maximum of 45 days wage in a year. Workers are eligible for compensation
as stated above even in case of closing down of undertakings.
Lay-off Compensation
In case of lay-off, employees are entitled to lay-off compensation at the rate to
50% of the total of the basic wage and dearness allowance for the period of their
lay-off except for weekly holidays. Lay-off compensation can normally paid up to 45
days in a year.
Safety and Health
Employee safety and health should be taken care of in order to protect the
employee against accidents, unhealthy working conditions and to protect worker
capacity. In India, the Factories Act, 1948, stipulated certain requirements regarding
working conditions with a view to provide safe working environment. These provisions
relate to cleanliness, disposal of waste and effluents, ventilation and temperature, dust
and fume, artificial humidification, over-crowding, lighting, drinking water, latrine
urinals, and spittoons. Provisions relating to safety measures include fencing of
machinery, work on or near machinery in motion, employment of young person’s on
dangerous machines, striking gear and devices for cutting off power, self-acting
machines, easing of new machinery, probation of employment of women and children
near cotton openers, hoists and lifts, lifting machines, chains ropes and lifting tackles,
revolving machinery, pressure plant, floors, excessive weights, protection eyes,
precautions against dangerous fumes, explosive or inflammable dust, gas etc.
Precautions against dangerous fumes, explosive or inflammable dust, gas etc.
Precautions in case of fire, power to require specifications of defective parts of test of
stability, safety of buildings and machinery etc.
6.4 REVISION POINTS
1. Fringe benefits various according to the position and organisations. The fringe
benefits are categorized as payment for time not worked and extra pay for the
39
time. The fringe benefits are classified under four heads namely, for
employment security, for health protection, for old age and retirement and for
personnel identification, participation and stimulation.
1. Discuss the various types of fringe benefits.
2. Discuss the administration of fringe benefits (model).
6.6 SUMMARY
Fringe benefits motivate the employees by identifying and satisfying their
unsatisfied needs, promote employees welfare, create sense of belongingness. These
are paid to all employees unlike incentives. They help to raise the living conditions
of employees. The fringe benefits administration takes in consideration the Grade of
Employee, processing authority, sanctioning authority.
1. Discuss the classification fringe benefits?
2. Elaborate on the categorization of fringe benefits?
3. Discuss the administration of fringe benefits (Model).
1. Discuss the importance of fringe benefits for employment security?
2. Elaborate on Fringe benefits for old age and retirement?
3. Does fringe benefits have no impact on the life style of worker? Discuss
6.9 ASSIGNMENTS
1. Compare and contrast fringe benefit provide to worker and executive?
2. What is the benefit for an organisation fringe benefit for “payment for time not
work”.
6.10. SUGGESTED READINGS / REFERENCE BOOKS
1. R.C.Saxena, Labour problems and social welfare.
2. Report on committee of labour welfare 1969.
3. Kid Kaday, H.S. “The spirit of industrial relations”.
4. William B.Werther, et. al Op. cct.
5. Business India, May 1993.
1. Surt the Net. Bring out the Investments that companies have made in Fringe
Benefits for its employees?
2. Discuss the fringe benefits provided to any company of your choice.
6.12 KEY WORDS
1. Deewali
2. Security
3. Deceased
4. Paid list
5. Soft furnishings
6. Reimbursement

40
LESSON - 7
BASIC HUMAN NEEDS - CHANGE NATURE OF HUMAN NEEDS

7.1 INTRODUCTION
The needs for Needs Theory - conservation personalist theories picture
humans as creative driven to engage in violent conflict. Liberal situationalist
theories provide conflict resolves with grounds for optimism. By emphasizing the
potency of social determinants rather than the Intractability of individual instincts.
The basic human theory has three virtues which seems notable.
7.2 OBJECTIVES
After reading this chapter you will be aware of
 The next step in theory development of basic human needs.
 Need for needs theory
 Need theories - virtues and limitations.
7.3 CONTENTS
Human needs
Basic human needs
The Next Steps In Theory Development
Since the publication of his seminal book, Deviance, Terrorism and War: The
Process of Solving Unsolved Social and Political Problems, John Burtorn has been
closely identified with the theory of basic human needs, an approach to
understanding protracted social conflict that he continues to espouse and to refine
(see. e.g., Burton, 1990a, 1997). Burton did not invent the theory, which posits the
existence of certain universal needs that must be satisfied if people are to prevent
or resolve destructive conflicts, but he gave it its most impassioned and
uncompromising expression.
In Deviance, Terrorism and War Burton acknowledged his debt to Paul Sites,
whose Control: The Basis of Social Order defined eight essential needs whose
satisfaction was required in order to produce “normal” (non-deviant, non-violent)
individual behaviour. According to Sites, these included the primary needs for
consistency of response, stimulation, security, and recognition, and derivative
needs for justice, meaning, rationality, and control. Sites, in turn, recognized the
importance of Abraham Maslow’s conception of human development as the
sequential satisfaction of basic needs, which Maslow had grouped under five
headings: physiological, safety, belongingness/love, esteem, and self-actualization.
The idea that humans qua humans have needs whose satisfaction is the effective
antidote to alienation is considerably older than this, of course, as Karl Marx’s
youthful reflections of Hegel suggest:
The whole of history is a preparation for ‘man’ to become the object of sense
perception and for needs to be needs of ‘man as man’.
It can be seen how (under socialism) the wealthy man and the plenitude of
human need take the place of economic wealth and poverty. The wealthy man is the
41
man who needs a complete manifestation of human life and a man in whom his
own realization exists as an inner necessity, as a need (“Towards a Critique of
Hegel’s Philosophy of Right: Introduction”, in McLellan, 1977, p. 94).
For Burton, the concept of basic human needs offered a possible method of
grounding the field of conflict analysis and resolution (which he and a few other
pioneers had essentially improvised during the 1960s) in a defensible theory of the
person.
Together with other peace researchers (see Lederer Galtung, 1980; Coate and
Rosati, 1988; and the writers represented in Burton, 1990b) he set out the reframe
the concept in order to provide the new field with a convincing alternative to the
prevailing paradigms of postwar social science: mechanistic utilitarianism,
behaviourism, cultural relativism, and Hobbesian “Realism”. In Burton’s view, the
needs most salient to an understanding of destructive social conflicts were those for
identity, recognition, security, and personal development. Over time, however, he
tended to emphasize the failure of existing states systems to satisfy the need for
identity as the primary source of modern ethno-nationalist struggles.
The great promise of human needs theory, in Burton’s view, was that it would
provide a relatively objective basis, transcending local political and cultural
differences, for understanding the sources of conflict, designing conflict resolution
processes, and founding conflict analysis and resolution as an autonomous
discipline. The importance of this ambitious project is now generally recognized by
conflict theorists, whether they agree with Burton or not (see Fisher, 1997; Avruch,
1998; Jeong, 2000). This essay will suggest some ways in which the project has
succeeded, some ways in which it has fallen short, and some possible avenues for
further theory development.
The Need for Needs Theory
From the end of World War II until the late 1970s, general theories of conflict
came in two varieties, neither of which, in John Burton’s view, was adequate to explain
either the persistence of “irrational” social struggles or the real opportunities for their
resolution. We can call these apparently opposed (but actually complementary) schools
of through conservative personalism and liberal situationalism.
Conservative personalist theories picture humans as creatures driven to
engage in violent conflict by sinful rebelliousness, innate aggressive instincts, or a
lust for power (e.g., Freud, 1989b; Lorens, 1997). From this perspective, the
situational environment merely provides a context and trigger for conflictual
thoughts and activities that are primarily internally generated. By definition,
human impulses to sin, aggress, or dominate cannot be stamped out; they require
control or “balancing” by countervailing force. If this be true, of course, non-violent,
self-enforcing conflict resolution (what Johan Galtung (1996) terms “peace by
peaceful means”) must be considered a utopian fantasy.
Liberal situationalist theories, on the other hand, seemed at first to provide
conflict resolvers with grounds for optimism. By emphasizing the potency of social
42
determinants rather than the intractability of individual instincts, they suggested

that conflict behaviours might be altered by altering the external situation. Strict
behaviourism (for an extreme example, see Skinner, 1965), relegated instincts and
other internal mechanisms to a metaphorical “black box”, postulating that, given a
certain environment or situation, people would behave in predictable ways.
Frustration-aggression theorists like Dollard reduced the aggressive instinct to a
mere potential for destructive action, with primary attention focused on situations
that activate this potential by frustrating goal-oriented activity. Social learning
theory presented humans as cognizing creatures whose ideas and attitudes were
largely determined by social conditioning. And much post-Freudian
psychoanalytical theory moved analogously from the primacy of instinct of family-or
culture-based situational determinism.
Burton’s crucial perception was that the apparent personalist/situatinolist
dichotomy masked an underlying similarity. Taken at their word, the personalists
held that the individual was unchangeably aggressive and the situationalist that
he/she was infinitely malleable. But these ‘inwardly driven” and “outwardly
determined” models of behaviour actually functioned as the polar extremes of a
continuum on which most analysts and policymakers occupied some midpoint.
Thus, while the personalists opened the door to limited “social engineering” by
suggesting that aggressive instincts could be externally controlled or
counterbalanced, the situationlists found themselves unable or unwilling to
reconstruct social environments (as Skinner had fantasized doing in Walden Two,
1976) to the extent necessary to eliminate anti-social behaviours.
When faced with a case of destructive violence, therefore, both schools of
thought tended to respond as if objectionable behaviour could be modified by
applying the right combination of threats and rewards. Both philosophies, that is,
were essentially utilitarian, with the conservatives emphasizing the control of
behaviour via the administration of pain (“deterrence”) and the liberals control via
the administration of pleasure (“positive reinforcement”).
Both perspectives, as John Burton, Johan Galtung, and others pointed out,
were essentially elitist; that is, they assumed that governing elites could pacify their
unruly subjects by discovering the point at which curves of pain and pleasure
would interest to produce “consensual” behaviour. And both, in practice, tended to
emphasize the stick more than the carrot, on the ground that force must be used as
the “persuader” of last resort. Where conservative and liberal utilitarian’s most
clearly joined forces was on the terrain of “Political Realism” - the perspective that
seeds political actors both as aggressive power-seekers and as rational calculators
of individual and group interest.
In foreign affairs, Realists emphasize the relentless pursuit of power by
completing nations and blocs, war as a continuation of politics by other means, and
power-based negotiations as the only practical alternative to inter-group violence
(Morgenthau, 1985). In domestic affairs, they emphasize the needs for normative
43
consensus, interest-based commercial and political bargaining, and the violent

suppression of crime (Cosier, 1964; Wilson, 1998). The problem, according to John
Burton and other needs theorists, was that the methods dictated by Realist
thinking had proved ineffective to prevent or terminate serious transnational and
domestic social conflicts.
Realism, in short, was simply not realistic. The type o social conflict most
characteristic of world society since 1950 - ethno - nationalist wars and civil wars,
violent struggles between races, social classes and religious groups, Great Power
“police actions”, terrorism, gang warfare, and crime - seemed largely immune to
coercive or manipulative counteraction. In fact, people’s involvement in these sorts
of struggles appeared to escalate in response to attempts to deter their behaviour
forcibly - a mysterious, frightening response that tempted their would-be controllers
to declare these intractably disobedient actors evil, irrational, or even non-human.
Faced with the near-genocidal implications of this cycle of violence, Burton and
others saw the need for a theory that would challenge both brands of Realism at the
level of their most basic assumptions. Basic human needs theory - a radically
optimistic personalism - was their answer.
Needs Theory: Virtues and Limitations
From the perspective of conflict analysis and resolution, basic human needs
theory offer theorists and practitioners certain important advantages. Three virtues
of the theory seem particularly notable:
First, it permits conflict resolvers to make a valid distinction between struggles
that can be dealt with employing the conventional trinity of force, law, and/or
power-based negotiation, and those whose resolution requires other measures.
“Needs and values are not for trading,” Burton asserts distinguishing needs-based
conflicts, and the processes of conflict resolution properly so called, from interest-
based disputes and the processes characteristic of strategic studies, conventional
diplomacy, and “alternative dispute resolution.” Another Burtonian apothegm,
“Deterrence cannot dater calls attention to the inefficacy of coercive methods to
modify behaviour when individuals or groups are impelled to act on the basis of
imperative needs.
Second, equipped with a needs-based map of the field, conflict analysis and
resolvers can understand the contradictions inherent in general notions like
“negotiation” and “dispute resolution,” and the necessity to design resolution
processes corresponding to a conflict’s underlying generic sources. Where the
conflict is generated by unsolved problems of political identity, for example, the
process required will be analytical exposing the differences between the conflicting
parties’ perceived interests and their underlying needs, and offering them a wide
range of possible solutions to the reframed identity problem. There is thus a
historical, if not logical, connection between human needs theory and the process
known as the analytical or interactive problem-solving workshop (see Fisher, 1997;
Mitchell and Banks, 1996).
44
Third, a needs-based approach to social conflict undermines conventional

notions of conflict causation, in particular the idea that destructive social conflicts
are produced instrumentally by a few manipulative leaders or expressively by the
sheer existence of cultural or ideological differences. (See, e.g., Rubenstein and
Crocker (1994) criticizing Samuel Huntington’s “clash of civilizations” theory). Using
unsatisfied needs as an independent variable, the theory helps to explain why
ruling class manipulation or cultural differences sometimes generate conflict and
sometimes fail to do so.
Moreover, the theory provides a basis for linking conflict analysis with conflict
resolution. Conflict resolution (as opposed to temporary “dispute settlement”)
requires a process that helps conflicting parties identify salient unsatisfied needs
and consider methods of accommodating social arrangements to the ineluctable
demands of “necessitous” individuals and groups. In some cases at least, this may
mean assisting the parties to conceptualise and implement significant “structural”
changes (see Rubenstein in Jeong, 2000, pp. 173-195).
Certain limitations of the theory, as currently formulated, can also be
identified. To begin with, the attempt establish an objective basis for socially and
politically salient needs in human biology or in unalterable “human nature” has
been criticized as indefensibly “essentialist,’ de-contextualised, and a-historical
(see, e.g., Avruch, 1998). In many ways, these criticisms seem apt.
John Burton has attempted to counter them by asserting boldly that, while
basic human needs themselves are universal, transcending differences in class,
gender, and culture, their satisfiers are culturally determined. But such a radical
separation between needs and satisfiers runs afoul of the fact that concepts like
identity and security are not independently existing “universals” rather, they are
ideas abstracted from a multiplicity of concrete satisfiers. If the satisfiers are
culture-bound, therefore so, too, are the needs.
Does this mean that there are no universal (i.e., genuinely “human”) needs?
Not necessarily. Biologizing (or “ontologizing”) needs are becoming universal as a
global culture comes painfully and convulsively into existence. It also forecloses
other necessary inquiries: for example, into the relationship between childhood and
adult behaviour. Is the adult’s quest for political identity, say, a natural extension
of the child’s needs to bond with and differentiate itself from its parents (see Clark,
in Burton, 1990b, pp. 35-59)? Or is it a regression symptomatic of incomplete or
interrupted child development? Similarly, does the alleged need for “sacred
meaning” postulated by Mary Clark spring from human nature, perhaps as a
further development of the child’s need for “consistency of responses” (see Sites in
Burton, 1990b, pp. 7-33)? Or, as Freud suggests in The Future of an Illusion
(1989), is it merely evidence of some individuals’ failure to “grow up”?
A related problem concerns the definition of the salient needs themselves.
While John Burton reduces the basic human needs to three or four, focusing
especially on identity and recognition, Johan Galtung, grouping them a la Maslow,
45
contends that an adequate account of needs as sources of destructive conflict must

also include the drive to satisfy basic needs for “welfare”, “freedom”, and “meaning”
(Galtung, in Burton, 1990b, pp. 301-335). From Burton’s perspective, the
characterization of “welfare” and “freedom” needs as basic is misleading, since
people will jeopardize or surrender both for the sake of defending their identities.
Moreover, extending the list of basic needs tends to blur the distinction between
“wants” and “needs” to the point that every intense desire may be conceived of as a
basic need. At the point that the wants/needs distinction washes away entirely, of
course, so does the utility of the theory.
Again, the difficulty does not seem insuperable, provided that one is willing to
conceive of needs as relatively rather than absolutely “basic”. We speak of “needs”
rather than “wants” when we are convinced that a failure to obtain what is desired
will produce results that are personally or socially destructive. (What is
“destructive”, of course, is not determined by biology; the term embodies an
element of political and moral judgment).
And we speak of needs as being “basic” when people in large enough numbers
desire something intensely enough period of time to sacrifice other desired ends for it.
On this basis, Galtung may be justified in describing the need for freedom as basic,
particularly when he specified it in terms of concrete satisfiers like physical mobility.
The needs that, if unsatisfied, generate destructive conflict may be therefore change
over the course of human history or even over the course of an individual’s personal
history. This fact does not prevent us from identifying and describing them or
suggesting conflict resolution solutions aimed at satisfying them.
7.4 REVISION POINTS
Then great promise of human needs theory in Burton’s view was that it would
provide a relatively objective basis, transcending local, political and cultural
differences.
Burton’s crucial perception was that the apparent personalist / seluationalist
Dichotomy masked an underlying similarity. In foreign affairs, realists emphasize
the relentless pursuit of power by competing nations and Blocs In domestic affairs
they emphasized the need for normative consensus, interest - taxed commercial
and political bargaining and the violent suppression of crime.
1. Discuss the need for needs theory?
2. What are the virtues and limitations of needs theory?
7.6 SUMMARY
The basic human needs theory offers theorists and practitioners certain
advantages. They are it permits conflict resolvers to make valid distinction between
struggles that can be dealt with by employing the conventional trinity of force, law
conflict analysts and resolvers can understand the contradictions inherent in
general notions like negotiation and dispute resolution. A needs - based approach
46
to social conflict undermines conventional notions of conflict causation. This theory

provides a bases for linking conflict analysis and conflict resolution.
1. Does the need theory has application in all situations of organization?
2. Discuss the virtues of needs theory?
1. Gankar “Industrial Relations in India” Himalaya publishing House, Mumbai.
2. L.S.Kudetiekar, “Aspect of Personnel Management and Industrial Relations,
1979.
3. R.Wayne Mondy and Robert M.Noe II, O. Cit.
4. S.C.Jain “Product arty and Discipline”, New Delhi, Allied; 1988.
7.9 ASSIGNMENTS
1. Elaborate on the Human Needs based on the Industry.
2. Discuss the importance of changing nature of human needs of people in our
country.
1. A.M.Sharma “Aspects of labour welfare and social security”.
2. International Journal of humanities of social sciences.
3. Asian Journal of Management Research.
1. Discuss the changing nature of human needs of executive and non executive
of an organization.
2. Find out, what are the similarities of human needs of employee in India and
USA?
7.12 KEY WORDS
1. Suppression
2. Metaphorical
3. Mysterious
4. Destructive
5. Conservative
6. Realists

47
LESSON - 8
THE MAJOR ROLE IN NEED FULFILLMENT - MAJOR ROLE IN

HUMAN NEED FULFILLMENT
8.1 INTRODUCTION
No theory of satisfiers in equivalent to theory of basic human needs. A second
line or Research and theory development might aim at exploring the needs and
satisfiers applicable to conflicts that are not purely or primarily ethno-Nationalist
but that involves other forms of group definition.
Having known the needs, the management is required to take some decision as
to how these needs can be fulfilled. The task before management is to discover the
present needs of an employee.
8.2 OBJECTIVE
After reading this chapter, you will be able to understand.
 Needs theory: Possibilities of further development.
 Manager’s role in human need fulfillment.
8.3 CONTENTS
Needs Theory: Possibilities of Further Development
Christopher Mitchell has rightly pointed out that we have not theory of satisfiers
equivalent to the theory of basic human needs. One cause of this lack may be that in
absolutizing basic human needs, John Burton and his fellow thinkers absolutely
relativised their satisfiers. If the need for identity, say, is everywhere and always the
same, but what will satisfy it is determined entirely by local histories and changing social
circumstances, it becomes difficult, perhaps impossible, to predict before the fact what
will “work” to terminate an identity-based conflict.
The collapse in 2000-2001 of the Oslo-initiated Middle East “peace process” is an
illuminating example of this problem. For years, Palestinian and Israeli negotiators
attempted in good faith to discover adequate satisfiers for their people’s identity and
security needs. But, working from an essentially secular perspective, neither side took
into account the explosiveness of essentially religious issues like the status of Jerusalem
and the Jewish settlements on the West Bank. The fact that these issues did prove so
difficult to resolve demonstrated that, at the mass level, the national identities in
question were conceived in religious as well as secular terms, and that measures not
satisfying this conception of identity were bound to fail.
The example suggests that by situating the identity need in the context of a group’s
history, i.e., by defining it more clearly in terms of its potential satisfiers, the problem of
assessing the relevance and adequacy if alternative satisfiers may be demystified.
The same Middle East situation exemplifies the fact that, disregarding John
Burton’s determined advocacy of conflict “prevention” needs theory is generally
applied after violent social conflict has erupted, under circumstances that make an
adequate analysis of the salient needs and satisfiers very difficult. Perhaps Ted
48
R.Gurr’s predictive study of minorities at risk will show needs theorists a possible
way to enhance the usefulness of their theory. One can conceive of a regional or
even global survey seeking to determine, in the case of specific ethnic or national
groups, how identity and security needs are conceived, what levels of satisfaction
prevail, and which satisfiers (i.e., what forms of socio-political change) seem best
suited to increase the level of satisfaction. If such a survey were successful in
calling attention to potentially violent conflict situations and the steps needed to
defuse them, needs theory would have clearly proved its usefulness.
A second line of research and theory development might aim at exploring the
needs and satisfier applicable to conflicts that are not purely or primarily ethno-
nationalist, but that involve other forms of group definition. It is understood that
many general conflict resolution theories bear the marks of their origin in the study
of particular types of conflict. Basic human needs theory was implicitly designed to
throw light on the sources and methods of resolving identity-group conflicts of the
sort that plagued world society during the postwar period of decolonization, and
that are far from obsolete even now. Nevertheless, especially since the late 1970s,
other forms of social conflict have forced themselves on our attention. This suggests
a series of questions requiring better answers: Which needs/satisfiers are relevant
to understanding the modern upsurge of religious conflict around the world? What
drives the revival of class struggle in nations of the semi-periphery? Which conflict
resolution processes are likely to be most effective in these diverse cases?
Third, in order to move from the relatively abstract level on which needs theory
functions at present to more concrete and useful understandings of the role of
basic needs in conflict, we need a better understating of their psychological origins
and the processes through which needs become conscious motivators of collective
action.
John Burton and Johan Galtung departed quite deliberately from Abraham
Maslow’s post-Freudian psychology, with its hierarchy of developmental needs
seemingly rooted in unacknowledged Western and bourgeois cultural values. But
there is some indication that, in extracting basic needs from the mental structures
postulated by Freud and his successors, the baby was thrown out with the bath
water. In effect, the needs theorists put emotional and cognitive dynamics into a
“black box,” much as their behaviourist predecessors had done.
Need Fulfillment
Manager’s role in human fulfillment
As we have stated earlier, need fulfillment is the responsibilities of the
management. Therefore, the manager should know what the needs (current) of the
employees are; and then should evaluate their legitimate and finally provide
opportunities for their attainment. The first tasks before the management is to discover
the present needs of an employee. Such needs may vary in intensity with which they are
expressed. Observation of a workers’ interest and response patterns may reveal the
needs of each worker. Personal conversations with the employees may also reveal these
49
needs. Some times, non-directive interviewing, or open-ended invitations to express the

interests goals, etc. may also give an idea about their needs.
Having known the needs, the management is required to take some decision as
to how these needs can be fulfilled. In so doing, the cost involved (in money, in
time, an in human efforts) are taken into consideration; and it is to be decided
whether the organization can bear the cost involved. Again, the effects of workers’
behaviour, as a considered.
Finally, the management thinks of various ways in which needs could be
fulfilled. These may be as follows:
a) Fulfillment of Psychological Needs: Basic needs are fulfilled by providing
reasonable wages and salaries with which basic necessities of life may be
purchased.
b) The need for security can be fulfilled by providing a consistent fair and
concerned attention to the workers. Medical hospitalization, pension plan,
social security benefits etc., are the measures through which economic
security could be provided.
c) The need for affiliation can be fulfilled by providing for work breaks, arranging
organization-wise picnics and bouquests; and prepare job assignments.
d) Competence need: The management can help to develop a feeling of
competency by properly assessing the capabilities of each employee and giving
the worker job assignments with
e) The reputation need is often fulfilled by giving praise for the work done well.
Promotion and salary increases based upon merit or techniques such as
employee of the week-awards, the giving of some prices for services rendered,
are other forms of management response to the needs of workers for esteem
and recognition.
The need for power generally fulfilled by delegation of authority. The need for
achievement can be fulfilled by assigning greater delegation of decision making
duties and assignments of high risk tasks.
8.4. REVISION POINTS
Basic human needs theory was implicitly designed to throw light on the
sources and methods of resolving identity - group conflicts. It is necessary to have
better understanding of their psychological origins and the processes through
which needs become conscious motivators of collective action for needs theory.
Managers should know what are the current needs of employees. Such needs may
vary in intensity with which they are expressed. Personal conversations with the
employees may also reveal their needs.
1. Discuss the needs theory possibilities of future development?
2. Elaborate on the Managers Role in human need fulfillment.
3. Discuss the task of managers in identifying the needs of employees?
50
8.6 SUMMARY
Managers by observation of workers. Interest and response patterns may
reveal the needs of each worker. Personal conversations with the employees may
also several these needs. Now the efforts of the Managers is how to fulfill these
needs.
It is understood that many general conflict and conflict resolution theories
bear the marks of their origin in the study of particular type of conflict.
1. ____________ Reveals the needs of employees (Personal conversation /
watching)
2. ___________ can be fulfilled by providing a consistent fair and concerned
attention to workers (competence needs / need for security)
3. ___________ can be fulfilled by going praise for the work done well (Competence
need / Reputation need)
4. ____________ can be fulfilled by delegation of authority. (Need for power / Need
for security)
1. Industrial Relation Labour Welfare and Labour Laws by B.Nandhakumar.
2. N.G.Nair “Personnel Management and Industrial Relations”, 2012.
3. R.C.Saxam “Labour Problems and Social welafare”, 1981.
8.9 ASSIGNMENTS
1. Identify the ways and means of fulfilling the needs of workers.
2. Discuss the management ways of fulfilling needs?
3. Identify the Reputation Need, Need for power for managers in Prodn centre
and for Managers in personnel Dept. Do they differ? If yes why? If not why?
4. Discuss the management techniques of satisfying various needs of
employees?
1. Richardson, J.H. “An Introduction to the study of Industrial Relations” 1954.
2. Personnel Management and Industrial Relations by LP.C. Tripathi.
3. Michael Armstrong OP cit.
1. Discuss with the Top level managers of 2 different organization. List out the
ways by which they are able to fulfill the need of employees.
2. Discuss with employees of 5 different organization. Does their need for
competence. Vary? Why/why not?
8.12 KEY WORDS
1. Reputation
2. Hospitalization
3. Fulfillment
4. Advocacy
5. Satisfiers
6. Decolonization

51
UNIT – III
LESSON - 9
WELFARE OFFICERS - ROLES AND RESPONSIBILITIES - DUTIES OF

WELFARE OFFICERS - TRAINING OF WELFARE OFFICER
9.1 INTRODUCTION
In early 1931, the Royal Commission on Labour recommended the
appointment of a Labour Officer to eliminate the position of evil practices of Jobbers
who use to engage & dismiss labour. In 1934, the Bombay Mill Owners Association
was persuaded by the state Govt. to appoint its own Labour Officer. By 1940, 26
Labour officers were appointed in Cotton Textile Mills.
During the war, the Police Function Gradually changed to welfare function.
They began to discharge the functions of Labour welfare officer. In 1946, the
Labour Investigation Committee strengthened its position and its importance was
stressed in Factories Act, 1948.
9.2 OBJECTIVES
After reading this chapter, you will be able to know about the
 Provisions pertaining to Roles & Responsibilities of welfare officer.
 Qualifications for the post of welfare officer.
 Duties of welfare officer under Factories Act.
 Functions of welfare officer their responsibilities.
 Conditions of service of Labour Welfare Officer and Training.
9.3. CONTENTS
Labour Welfare Officers
The eradication of the jobber system and the appointment of Labour Officer
was recommended and suggested by the Royal Commission on Labour in 1831 due
to ill-treatment of labour to the large extent by ‘jobbers’ (in the textile industry) or
‘mukadams’ (in the engineering industry) or ‘sridars’ (in plantations) in the early
days. The Commission observed:
We advance for all factories the exclusion of the jobber from the engagement
and dismissals of labour. This can best be achieved by the employment of a Labour
Officer, and this is the course we recommend wherever the scale of factory permits
it. he should be subordinate to no one except the General Manager of the factory,
and should be carefully selected, integrity, personality, energy, the gift of
understanding individuals and linguistic facility are the main qualities required. No
employee should be engaged except by the labour officer personally, in consultation
with departmental heads, and none should be dismissed without his consent,
except by the Manager himself, after hearing what the labour officer has to say. It
should be the business of the labour officer to ensure that no employee is
discharged without adequate cause; if he is of the right type, the workers will
rapidly learn to place confidence in him and to regard him as their friend. There are
many other duties which such on officer can fulfil, particularly, in respect to
welfare. Thus, the post of Labour Officer was instituted initially with the objectives of
52
a) eliminating the evils and malpractices of the jobber system;

b) developing and improving administration in mills; and
c) helping as a liaison with the State Labour Commissioner.
The Labour Investigation Committee also gave importance to the institution
of Labour Officer. Its recommendations made sizeable impact on the thinking of the
Government before independence.
The cotton textile mills in Mumbai (Bombay) and the jute industry in Kolkata
(Calcutta) appointed the first Labour Officers in the 1930s. They were expected to
a) discharge the policing function including maintenance of law and order
in an organization; and
b) introduce certain welfare service like setting up of foodgrain cooperatives,
the organization of sports, and so on.
Statutory provisions pertaining to appointment of a Welfare Officer
Provisions of Section 49 of the Factories Act, 1948
1. In every factory wherein five hundred or more workers are ordinarily
employed, the occupier shall employ in the factory such number of Welfare
Officers as may be prescribed.
2. The State Government may prescribe the duties, qualifications and condition
of service of officers employed under Subsection (1)
Provision of Section 18 (1) and (2) of the Plantations Labour Act, 1951
1. In every plantation wherein three hundred or more workers are ordinarily
employed, the employer shall employ such number of Welfare Officers as may
be prescribed.
2. The State Government may prescribe the duties, qualifications and conditions
of service of officers employed under subsection (1).
Provisions under Section 58 (q) and Rule 72 of the Mines Rules, 1955
For every mine wherein 500 or more persons are (ordinarily employed), the
owner, agent or manager shall appoint a suitably qualified person as Welfare
Officers, and where the number of persons of employed in mine exceeds 2,500,
such welfare Officer shall be assisted by one suitably qualified additional Welfare
Officer for every additional 2,000 persons (or part thereof employed).
Qualifications for the post of Welfare Officer
The State Governments and Central Government have created a framework for
qualification, duties and conditions of employment of the Welfare Officers under the
respective enactments. Qualifications required for Welfare Officer are as follows:
1. A degree of a university recognized by the State Government in this behalf.
2. Degree of diploma in social science (or social work or labour welfare in the
case of mines) recognized by the State Government in this behalf. In addition
to this, the Mines Rules lay down the following: “Preferably practical
experience of handling labour problems in any industrial undertaking for at
least three years”.
3. Adequate knowledge of the language spoken by the majority of the workers in
the area where the factories, mines and plantations are situated.
53
Provisions under Section 58 (q) and Rule 72 of the Mines Rules, 1955
No person shall act as a Welfare Officer of a mine unless he possesses
1. a university degree;
2. a degree of diploma in social science, (or social work) or labour welfare recognized
by the Government for the purpose of this Rule, and preferably practical
experience of handling labour problems in any industrial undertaking for at least
three years; and
3. a knowledge of the language of the district in which the mine is situated or the
language understood by the majority of persons employed in the mine:
Provided that in case of a person already in service as a Welfare Officer in a mine,
the above qualifications may, with the approval of the Chief Inspector, be relaxed.
Notwithstanding anything contained in subrule (2), the Labour Officers, included
in the Central pool under the provisions of the Labour Officers (Central Pool)
Recruitment and Conditions of Service rules, 1951, shall be eligible for
appointment as a Welfare Officer in a mine.
4. Where by reason of temporary absence, illness or any other similar cause, the
Welfare Officer is unable to perform his duties, the owner, agent or manager shall
authorize in writing a person whom he considers competent, to act in his place:
Provided that non such authority shall have effect for a period in excess of 30
days except with the previous consent of the Chief Inspector.
5. A written notice of every appointment, authorization, discharge, dismissal,
resignation or termination of service of every Welfare Officer and of the date
thereof shall be sent by the owner, agent or manager the Chief Inspector within
seven days from the date of such appointment, authorization, discharge,
dismissal, resignation or termination of service.
The post of Welfare Officer shall be advertised in a newspaper having a wide
circulation in the Stage.
Duties of the Welfare Officer under the Factories Act
The Model Rules framed under the Factories Act have laid down a chart of
duties for the Welfare Officer. These duties are as follows:
1. Supervision of safety, health and welfare programmes like housing, recreation,
sanitation services a provided under law or otherwise.
2. Counselling workers in personal and family problems, and in adjusting to work
environment.
3. Advising management in formulating labour welfare policies and training
programmes.
4. Maintaining liaisons with workers, management and with other outside
agencies like Factory Inspectorate, Central Labour Institute and other social
welfare agencies.
5. Suggesting measures for the promotion of harmonious industrial relations and
general well-being of the workers by adopting various measures in the plant
for the redressal of grievance and for increasing the productive efficiency of the
workers.
54
The functions of the Welfare Officer

The functions of a Welfare Officer could broadly be classified into the following
categories:
a) Labour welfare (welfare function).
b) Labour administration (personnel function), and
c) Labour relation (conciliation function).
1. Labour welfare (welfare function): Welfare Officer advises and provides
assistance in implementing legislatives and non-legislative provisions relating
to health, safety, welfare, hours of work, leave, and formation of welfare
committees.
2. Labour administration (personnel function): Welfare Officer is held
responsible for labour administration such as organizational discipline, safety
and medical administration, and liaison, wage and salary administration, and
education of workers.
3. Labour relations (conciliation function): Welfare Officer renders some of the
labour relations activity such as settlement of grievances, administration,
education of workers and settlement of disputes, and promotion of
harmonious labour-management relations. He/she also works as staff advisor
or specialist.
Duties of Welfare Officer: Under Rule 73 of the Mines Rules, 1955, the duties of
Welfare Officer shall be to:
1. establish contacts and hold consultations with a view to maintain harmonious
relations between the management and persons employed in the mine;
2. bring to the notice of the management the grievance of employees, individual
as well as collective, with a view to securing their expeditious redressal;
3. promote relations between management and employees, which will ensure
productive efficiency as well as amelioration in the working conditions, and to
help workers to adjust and adapt themselves to their working environments;
4. assist in the formation of Work and Joint Production Committees, Cooperative
Societies and Safety First and Welfare Committees and to supervise their work;
5. help the management in regulating the grant of leave with wages and explain
to the workers the provisions relating to leave with wages and other leave
privileges, and to guide the workers in the matter of submission of
applications for grant of leave for regulating authorized absence:
6. advise on welfare provisions such as housing facilities, foodstuffs, social and
recreational facilities, sanitation, individual problems and education of
children;
7. supervise welfare activities, statutory or otherwise including education and
training of employees;
8. suggest measures which will tend to raise standard of living of workers and in
general promote their well-being; and
9. perform any other duty connected with the welfare of the persons employed in
the mine.
Notwithstanding anything contained in Sub-rule (1), no Welfare Officer shall deal
with any disciplinary case against a person employed in a mine, or appear before a
55
Conciliation Officer, Court or Tribunal on behalf of the management of a mine against

a person or persons employed in the mine, except, when he is required by the
Conciliation Officer, Court or Tribunal to appear as in independent witness:
Provided that nothing in this Sub-rule shall be deemed to prohibit a person
employed in a mine from approaching the Welfare Officer in respect of a grievance
arising out of any case of disciplinary action against him.
Every Welfare Officer shall keep a record of his day-to-day work and shall, at
the end of every year, forward to the Chief Inspector through the manager of the
mine, concerned summary of the report of his work during the year.
Conditions of service of the Welfare Officers
The Committees on Labour Welfare has recommended the following:
The management should designate one of the existing officers of their
personnel departments as Welfare Officer to fulfil the purpose of the law. The
management should ensure that only such Officers of the personnel department are
designated to look after the welfare activities as are properly qualified to hold these
posts and have aptitude for welfare work.
The National Commission on Labour states:
The care of workers in all matters affecting their well-being, both at the place of
work and outside, puts a special responsibility on the Welfare Officer who has to be a
maintenance engineer on the human side. However, in many cases, the Welfare Officers
also handle grievances and complaints of workers relating terms and conditions of
service, and domestic and other matters which lie in the domain of personnel
management. There is, thus, virtually no demarcation between personnel management
function and welfare functions. The Welfare Officers, at present, do not have job
satisfaction, since the subject of welfare is not generally accorded adequate importance.
It is treated more as a statutory requirement to be tolerated.
Provision under Rule 74 of the Mines Rules, 1955
Conditions of service of the welfare Officers shall be the following:
1. A Welfare Officer shall be given appropriate status corresponding to the
status of the other executive heads of the mine.
2. The conditions of service of Welfare Officer shall be the same as of other
members of the staff of corresponding status in the mine:
Provident that before the owner, agent manager discharges or dismisses a
Welfare Officer who has satisfactorily completed a probationary period of six
months, he shall consult the Chief Inspector or an Inspector authorized in
this behalf by the Chief Inspector.
A Welfare Officer shall not be given less than two hundred rupees as his
basic pay per mensem.
9.4 REVISION POINTS
The Labour Welfare Officer will be a supervisor, counseling workers, advising
management, establish liaison with workers, liaison with management, improve
productivity. He should be a post graduate in social science, Diploma in Labour
56
welfare recognized by State Govt. 3-5 years working experience in Industrial safely
and have hard working ability and sound communication skills.
1. Explain the duties and responsibilities of labour welfare officer.
2. Discuss the functions of welfare officers.
3. What are the statutory provisions pertaining to appointment of a welfare officer?
4. Discuss the conditions of service of welfare officers?
9.6 SUMMARY
According to Schedule 49 of Factories Act 1948, in every factory where in 500
or more workers are ordinarily employed, the employer shall appoint a person who
can act as a Advisor, counselor, mediator between the management and labour, for
improving the efficiency, productivity of profitability. The duties that he has to
perform are supervision of safety healthy and welfare programmes like housing,
recreation, sanitation services as provided under law.
1. Discuss the qualifications required for labour welfare officer?
2. A labour welfare officer is basically __________ (counselor / engineer)
3. The primary skills he must possess is _________ (technical / listening)
4. Labour welfare officer role is also to ____________ (resolve dispute / reach sales target).
5. Labour welfare officers concern is to ________ (implement labour law / implement
computers)
1. Report on the Committee on Labour Welfare, 1969.
2. www-outsource 2 India.com
3. N.G.Nair, Personnel Management and Industrial Relations, 2012.
4. Asian Journal of Management Research.
5. International Journal of Humanities and Social Sciences.
9.9 ASSIGNMENTS
1. Go round few district of you state, identify few factories / industries. Make a list of
functions, duties of welfare functions that welfare officer do.
1. R.C.Saxene “Labour problems and social welfare”, 1981.
2. C.lB.Memoria - “Dynamic of Industrial Relations in India” Himalaya Publishing
Hosur, 2008.
3. John Bratton and Jeffrey Gold, Human Resources Management.
1. What are the other duties that the welfare officer does in organization?
2. Does these exist a need of welfare officer in an organization?
3. Discuss the skills that welfare officer mostly lacks. Why?
9.12 KEY WORDS
Labour Administration, Labour Relations, Health & Welfare Programmes,
Counseling, Harmonious

57
LESSON - 10
AIMS AND OBJECTIVES OF WORKERS EDUCATION

10.1 INTRODUCTION
The workers education is a special kind of adult education designed to give
workers a better understand of their status, rights & responsibilities as workers as
union member, as a family member and a s a citizen. The workers education plays
on emphasis upon group advancement and solution of group problems.
10.2 OBJECTIVES
After reading this chapter you should be able to understand
 Aims and objectives of workers education in India.
 Workers education contents.
 Activities of Central Board for workers education.
 Levels of workers education programme.
10.3. CONTENTS
Workers’ Education in India
In India, inclusion of Workers’ Education in the second five year plan (1956-
61) marks the beginning of some systematic efforts to organize educational
programmes for workers in our country. This ultimately led to the setting up of an
autonomous Central Board for Workers Education (CB WE) in 1958 to administer a
three tier scheme formulated by the Government of India. Till today, the CB WE
continues to be the focal point of workers’ education in India.
The Indian Institute of Workers Education (II WE) was established in March
1970 by the Central Board for Workers Education. It is the Workers Apex Training
Institute on with fully equipped training facilities and modern amenities viz.
Modern Training Hall of International standard, Conference Hall Auditorium,
Hostel, Canteen etc.
Aims and Objectives
The aim of establishing II WE is to enable the Board to conduct National level
training programmes for achieving its objectives, to develop stronger and more
responsible trade unions, to promote the growth of democratic process in trade
union organization and administration, to equip organized labour to take its place
in a democratic society and to inculcate in them the spirit of commonality of
interests. In addition to this, it also conducts pre-employment course for education
officers and refresher and special courses for regional directors, education officers
and staff from time to time.
The institute serves as a demonstration and information center and acts as a
nucleus around which specialized schemes for training and education to labour
and management are designed. It also serves as a knowledge bank for Regional and
Sub-Regional Directorates of the Board.
The institute is designed to function as an interdisciplinary training center. It
further draws upon the experiences of foreign countries in implementation of
workers education programmes and adapts them to fit in the Indian environment. It
also serves as an in-house training center for the officials of the Board. The
58
institution, in the past, had also catered to the educational needs of labour
educators from Afro-Asian countries sponsored by the I.L.O.
The II WE has a managing committee of tripartite character to plan and direct
all academic activities of the institute. At present, the Deputy Director (Training)
acts as the head of the Institute. The Institute functions under the overall
supervision of the Director, CBWE.
Contents of Workers’ Education
Workers’ education attempts to give workers a better understanding of their
status, rights and responsibilities as workers, as union members, as family
members and as citizens. Workers’ education addresses a whole range of skills and
knowledge, which contribute to the harmonious development of a worker’s
personality, his role in the society and the knowledge and attitudes required for
such roles. Workers’ education emphasizes group advancement and solution of
group problems. It differs from vocational and professional group advancement and
solution of group problems. It differs from vocational and professional education,
which is meant for individual advancement whereas the Workers’ education lays
stress on group advancement.
Workers education is one of the principal objectives of the Ministry of Labour
and Employment which seeks to achieve through the enforcement of various labour
laws and implementation of various schemes and programmes. The main thrust is
on the education of tribal workers, women workers and weaker section workers.
The scheme of workers’ education aims at achieving the objectives of creating
and increasing awareness and educating the workforce for their effective
participation in the socioeconomic conducted by the board for the workers of formal
and informal sectors at national, regional and unit levels through a network of 50
regional and 90 sub-regional directorates spread all over the country......... apex
training institute vzi. IIWE at Mumbai.
The Constitution of India guarantees right to education to the citizens. Article
45 of the Indian Constitution enjoins that the State shall endeavour to provide early
childhood care and education for all children until the complete the age of 6 and 14
years. “Also Article 21A (which has been inserted by the 86 th Amendment in
December 2002 has not yet been brought into force) provides that the State shall
provide free and compulsory education to all children of the age of 14 years in such
manner as the State may, by law, determine.
In pursuance of National Child Labour Policy, a scheme was started in 1988 to
rehabilitate child labour. It contains the action plan for tackling the problem of
child labour. The scheme seeks to adopt a sequential approach with focus on
rehabilitation of children working in hazardous occupations and process in the first
instance. Under the Scheme, after a survey of child labour engaged in hazardous
occupations and process has been conducted, children are to be withdrawn from
these occupations and processes and then put into special schools in order to
enable them to be mainstreamed into formal schooling system.
The scheme of child labour elimination has been linked with the scheme of
Sarva Shiksha Abhiyan of the MHRD in order to ensure that small children in the
59
age group of 5-8 years get directly linked to school and the older children are
mainstreamed to the formal education system through the rehabilitation centers
and also vocational training is imparted to them.
Activities of Central Board for Workers Education (CBWE)
During the second five year plan, it was felt by the planners that democratic
society like ours requires an active and intelligent participation of workers in the
affairs of their trade union and of the country for its speedy socioeconomic
development. A strong, free, responsible and democratic trade union movement can
make significant contribution to the realization of better life for workers. Workers
should be trained to play their roles effectively for attainment of socioeconomic
development of the country. It was envisaged that workers education can help in
preparing the workers and their trade unions to play their role effectively in the
task of nation building. It necessitated the Government of India in the year 1957 to
secure an expert advice in formulating “Workers Education Scheme”.
The Government of India, in co-operation with the Ford Foundation, appointed
an International Team of Experts to suggest Workers Education Scheme. The team
of experts submitted its report in March 1957. The recommendations of the team
were endorsed by the 15th Session of the Indian Labour Conference in July 1957.
The Indian Labour Conference recommended setting up of a semi-autonomous
board for administering the Workers Education Scheme. Consequent upon the
recommendations of the Indian Labour Conference, the Central Board for Workers
Education established in 1958 was registered under the Societies Registration Act
XXI of 1860 on 16th September 1958 as a tripartite society.
Structure of the Organization
1. The Members of the Society (Board) include the Chairman, (nominated by the
Government of India), Representatives of workers, employers, Government
(both Central and State) and Educational Bodies.
2. The Director of the Board is the Member Secretary and Principal Executive
Officer.
3. The affairs of the Board are managed by a Governing Body elected annually
from amongst the member of the Board
Objectives of the Organization
The Board operates its activities at three levels viz., national, regional and unit level
and conducts various training programmes for the organized, unorganized/small scale,
rural and informal sector workers with the following objectives:
a) To strengthen among all sections of the working class, including rural
workers, a sense of patriotism, national integrity, unity, amity, communal
harmony, secularism and pride in being an Indian.
b) To equip all sections of workers including rural workers for their intelligent
participation in social and economic development of the nation in accordance
with its declared objectives.
c) To develop among workers a greater understanding of the problems of their
social and economic environment, their responsibilities towards family
60
members, and their rights and obligations as citizens, as workers in industry,

as members and officials of their trade union.
d) To develop leadership from among the rank and file of workers themselves.
e) To develop strong, united and more responsible trade unions through more
enlightened members and better trained officials.
f) To strengthen democratic processes and traditions in the trade union
movement.
g) To enable trade unions themselves to take over ultimately the functions of
workers education.
The national level programmes are conducted by the Indian Institute of Workers
Education, an apex training institute of the Board established in 1970, while the
regional and unit level programmes are conducted through a network of 48 regional
and 15 sub-regional centers spread throughout the country. The four Zonal
Directorates established by the Board supervise and monitor the activities of the
Regional Centers under their respective zone at Delhi, Mumbai, Calcutta and Chennai.
Activities / Schemes
Initially, the Board’s activities were concentrated on educating the workers
employed in the organized sector. However, as recommended by the Workers
Education Review Committee and agreed by the government of India, the board
shifted its emphasis from organized sector to the education of workers in rural
sector. Starting with seven pilot projects since 1977-78, the rural workers
education of the Board has become a regular, continuing and countrywide
programme. However, the role of the CBWE is mainly educational and motivational
through dialogic process to equip rural workers to appreciate and analyze their
socioeconomic problems through organized action. The categories of workers covered in
these rural programmes are in conformity with ILO Convention No.141 and
Recommendation No.149 on rural workers.
Further the Board took initiative to educate the workers of unorganized and small
scale sector industries since 1979 with a view to develop awareness about their
problems, difficulties and protective labour laws at workplace and help them in finding
solutions as well as equip them in developing and strengthening their own organizations.
The Board has also been organizing since 1984 periodic camps for the workers in
the done quarries and stone crushers of Faridabad District to enlighten them about their
rights and entitlements as per the directive of the Honourable Supreme Court of India.
In pursuance of the new directions and dimensions, the Board has evolved several
specialized short-term programmes to meet the growing needs of the workers at grass-
root. Short-term programmes on productivity education, population education,
participative education are organized at enterprise level while tailor-made programmes
were also structured to meet the educational needs of weaker section workers.
Joint Educational Programmes have been introduced at the plant level for the
representatives of workers and management who come together for a purposeful
dialogue on selected theme which affect the both. The joint educational
programmes have become popular as it gives opportunity for the worker to meet at
a common forum.
61
The Board has recently launched a new programme “Quality of Life for
Workers and their Spouses” with a view to mould their attitudes, develop
motivation, build up personality, raise family status, maintain good neighbourhood
relations, develop awareness about environmental cleanliness, develop a spirit of
team work, human relations, productivity consciousness, commitment to discipline,
mutual trust and hygiene, etc.
Levels of workers’ education programme
The workers education programme contains three levels. These levels are
discussed here.
1. The National Level In this level, Education Officers are trained. The
participants for the programme are selected by CBWE and trained at a central
place by the Board officials.
Some of the conducted programs are given below,
a) Training of Education Officers at the Indian Institute of Workers
Education, Mumbai (5 months) and Re-training (1 month).
b) Workshop/Refresher Courses for Education Officers (1 week)
c) Training Programmes for Trade Union Officials (1 week)
d) National Seminars on important topics (2 days)
2. The Region Level In this level, aim at imparting necessary training to selected
workers. The workers so educated are known as workers’ teachers.
a) Worker-Teachers Training Course (3 months)
b) Leadership Development Course (1 month)
c) Refresher Course for Worker Teachers (1 week)
d) Course for Rural Educators/Organizers (1month)
e) Orientation Programme for Rural Educators/Organizers (1 week)
f) Joint Educational Programme on Participative Management (3 days)
g) Need Based Seminar (2 days)
h) Joint Educational Programme for Members of Joint Councils and Bipartitie
Committees (2 days)
i) Quality of Life for workers and their Spouses (2/5 Days)
j) Special Seminar at Plan Level (1 Day)
3. The Unit Level In this stage, the workers’ teachers on completion of their
training return to their workplace and conduct programme for rank and file
workers at their respective units.
a) Two days Awareness Camps for Rural workers.
b) Camp for Workers in Unorganized Sector/Weaker Section (5 days)
c) Special Seminars for Unorganized/Weaker Section (2 days)
d) Special Seminar for Women Labour (2 days)
e) Special Seminar for SC/ST Workers (2 days)
f) Special Seminar for Parents of Child Labour/Child Labour (2 days)
g) Part-Time Unit Level Class (3 months)
h) Part-time Unit Level Class (1 month)
i) Functional Adult Literacy Class (6 months)
62
j) Need Based Special Programme at the Unit Level (3-5 days)

k) Week-end Unit Level Class (3 months)
10.4 REVISION POINTS
The Central Board for workers Education was established on 16 th September
1958. The Board is Tripartite in character. The Board carries out Activities at three
revels - National, Regional and unit. The CNWE has different objective. The Board
organizes 29 types of training programmes.
1. Explain the objectives of the Central Board for workers education.
2. Discuss the structure of CBWE
3. What are the various levels of workers education programme?.
10.6 SUMMARY
It is being increasingly realized that there is a growing need for the kind of
education that will properly equip workers and Trade Unions to meet their
increasingly heavy Economic and Social Responsibilities. The workers education
has to take into consideration the educational needs of the worker as an Individual
for his personal evolution, as an operative for his efficiency and advancement, as a
citizen for a happy and integrated life in the community.
1. Discuss workers education in India.
2. Illustrate the economic implications of the workers education scheme.
3. Bring out the suggestions and recommendations for better implementation of
workers education scheme.
1. Indian Labour Journal, Vol 27, 1994.
2. Report of Royal commission on labour, 1931, P27.
3. Multan L.Rock Op. Cit., P75
4. A.M.Sarma, “Industrial Relations”, Himalaya publishing House, Mumbai, 2012.
5. Industrial relations labour welfare are labour laws By B.Nandhakumar.
10.9 ASSIGNMENTS
1. Is there a long Term Benefit for workers education in India. Discuss?
2. What are the other types of education programmes that has to be evolved?
3. Has workers education reached all the employees of organization? discuss.
1. A.M.Sharma, “Aspects of Labour welfare and Social Security” Himalaya
Publishing House, 2013.
2. C.B.Memona - “Dynamic of Industrial Relation in India”, Himalaya Publishing
House, 2008.
3. R.C.Sxana “Labour problem and social welfare”, 1981.
10.11 LEARNING ACTIVTIES
1. Michael Armstrong Op. Cit. P.432.
2. ibid., P.62
3. Milton L.Rock, Op. Cit. P75.
10.12 KEY WORDS
1. Employee Education 3. Leadership 5. Director
2. Special seminar 4. Orientation 6. Integrity

63
LESSON - 11
RECOMMENDATION OF NATIONAL COMMISSION ON LABOUR

11.1 INTRODUCTION
National Labour Commission 1929 (First) has promised lot in the Direction of
Social Security, Social Welfare, wages, social insurance, industrial relations,
industrial adjudication, collective bargaining.
11.2 OBJECTIVES
After reading this chapter you will be able to understand
 Recommendation of commission
 Commission view on Industrial Relations and Trade Union
 Recommendation of Commission on Social Security.
11.3 CONTENTS
National Commission of Labour (NCL)
The first National Labour Commission 1929, had promised lot in the direction
of social security, social welfare, wages, social insurance, industrial relations,
industrial adjudication, collective bargaining etc., In sequel to the recommendations
made in the report of the first national commission on labour series of labour
enactments were passed.
After the gap of almost 72 years the Second National Labour Commission has
been constituted and submitted its report in the year 2002 to the Government of
India. At the outset, the terms of reference to the commission are as under:
1. To suggest rationalization of existing laws relating to labour in the organized
sector.
2. To suggest an umbrella legislation of ensuring a minimum level of protection
to the workers in the unorganized sector.
Methodology
Before penning down the report, the Commission followed the following methodology:
3. Arranged to consultation / conferences in the major cities of India to get the
opinion of the industry, public, educationalists and so on institutions’;
4. Circulated a questionnaire across the industry and the society in terms of the
reference.
5. Surveys conducted both in organized and unorganized sector.
Recommendations
The recommendations of the Commission consists of the chapters, namely
1. The terms of the reference of the Commission
2. Introductory review
3. Industrial Development and Progress after independence
4. Impact of globalization - in comparison with neighbouring countries.
5. Approach to review laws
6. Review of laws
7. Unorganized sector
64
8. Social security
9. Women and Child labour
10. Skill development
11. Labour administration and other matters
Only relevant part of important chapters with special reference to the
organized sector and major recommendations of Commission thereof are dealt
verbatim herein below:
Recommendations
1. We recommended that the Central Government and the State Government
should have a unit have a uniform policy on holidays, only 3 national holidays
be gazette - namely Independence day, Republic Day and Gandhi Jayanthi Day,
two more days may be added to be determined by each State according to its
own traditional and apart from these each person must be allowed to avail of 10
restricted holidays in the year, Government holidays should be delinked from
holidays under the Negotiable Instruments Act. (5.29)
2. Flexibility in the hours of work per week and compensation for overtime. (5.32)
3. Attempt to change the basis of tenure in all jobs (permanent as well as non-
permanent to contractual and for stipulated periods, involves a basic change in
attitude and notion. If transforming the basis of all employment is a social
necessity because it has become economic necessity for industrial and
commercial enterprises, then, it is equally necessary to create social
acceptability for the change and the social institutions that can take care of the
consequences. (5.34 & 35).
The fundamental change of this type has to be preceded by:
i) Evolution of socially accepted consensus on the new perceptional jobs.
ii) The evolution of a system of constant up-gradation of employability
through training in a wide spectrum of multiple skills
iii) The setting up of a system of social security that includes unemployment
insurance and provisions for medical facilities; and
iv) The institution of a mandatory system of two contracts - one, an individual
contract and two, a collective contract with workers union.
4. The commission recommends that government may laid down list of highly
paid jobs who are presently deemed as workmen category as being outside the
purview of the laws relating to workmen and included in the proposed law for
protection non-workmen. Another alternative is that the present context such
as Rs.25,000/- p.m. beyond which employee will not be treated as ordinary
“workman”, (6.19) wage ceiling of Rs.25000/-
5. Further the commission recommended that it would be logical to keep all the
supervisory personnel, of their wages / salary, outside the rank of worker and
keep them out of the purview of labour law meant for workers. All such
supervisory category of employees should be clubbed along with the category of
persons who discharge managerial and administrative functions. The
Commission would also recommended that such a modified definition of worker
could be adopted in all the labour laws. We except management to take care of
65
the interest of supervisory staff as they will now be part of managerial

fraternity. (6.20) Modified definition of workers
6. Existing sent of labour laws should be broadly grouped into four or five groups
of laws pertaining to:
a) Industrial relations
b) Wages
c) Social security
d) Safety
e) Welfare and working conditions and so on.
The Commission is of the view that the coverage as well as the definition of the
term ‘worker’ should be the same in all Group of laws subject to the stipulation
that social security benefits must be available to all employees including
administrative, managerial, supervisory and other excluded from the category
of workmen and others not treated as workmen or excluded from the category
of workmen (6.21)
7. It is necessary to provide minimum level of protection to managerial and other
(excluded) employees too against unfair dismissal or removal. This has to be
trough adjudication by labour court or Labour Relations Commission or
arbitration. (6.22)
8. Central laws relating to the subject of labour relations are currently the ID Act,
1947, The TU Act, 1926, Industrial employment (SO) Act, 1946, Sales
Promotion Employees (Conditions of Service) act, 1976. There are State Level
legislation too on the subject. We recommend that the provisions of all these
laws be judiciously consolidated into a single law called “The Labour
Management Relations Law” or “Law on Labour Management Relations”. (6.26)
9. We would recommend the enactment of special law for small scale unit. We
have come to the conclusion that the reasonable threshold limit will be 19
workers. Any establishment with workers above that number cannot be regards
as “small”. The composite law suggested by us for small enterprises has
provisions for registration of establishment, (provisions pertaining to) securing
safety, health and welfare, awards of work, leave, payment of wages, payment
of bonus compensation in case of lay off, retrenchment and closure, resolution
of individual and collective disputes of workers etc. The law suggested by us
also has provisions pertaining to social security. We are of the view that a
composite law will not only protect the interest of the workers in these
enterprises but will make it easier for the small enterprises to comply with the
same. (6.28)
Approaches in drafting the law on labour management relations
1. The Commission would prefer the gender neutral expression ‘worker’ instead of
the currently used word ‘workman’.
2. The law will apply uniformly to all such establishments.
66
3. We recognize that today the extent of unionization is low and even this low level
is being eroded, and that it is time that the stand was reversed and collective
negotiations encouraged.
Where agreements and understanding between two parties is not possible,
there, recourse to the assistance of third party should as far as possible be
through arbitration or where adjudication is the preferred mode, through
Labour Courts and Labour Relations Commissions of the type be proposed later
in this regard and not governmental intervention. A settlement enter into with
recognized negotiating agent must be binding on all workers.
4. We consider that provisions must be made in the law for determining
negotiating agents, particularly on behalf of workers.
5. The law must provide for authorities to identify the negotiating agent, to
adjudicate disputes and so on, and these must be provided in the shape of
labour courts and labour relations Commissions at the State, Central and
national levels.
6. The Commission is of the view that changes in labour laws be accompanied by a
well defined social security package that will benefit all workers, are they in
‘organized’ or ‘unorganized’ sector and should also cover those in the
administrative, managerial and other categories which have been excluded from
the purview of the term worker.
Industrial relations and trade union
The commission has avoided the term ‘Industry’ with a view that the persons
engaged in domestic service are better covered under the proposed type of umbrella
legislation, particularly in regard to wages, hours of work, working conditions,
safety and social security. (6.40)
Modification in the terms like ‘strikes’, ‘work stoppage’ etc. and the terms go
slow and work to rule must be regarded as misconduct under Standing Orders and
Provisions relating to unpaid labour practice. (6.41)
Commission has recommended to the withdrawal of essential services
maintenance Act (6.49)
The Commission has suggested to identify a bargaining agent on the basis of
check-off system, with 66% entitling the Union to be accepted as a single
negotiating agent and if no union 66% support, then Unions that have the support
of more than 25% should be given proportionate representation on the college.
(6.66)
Check-off system in an establishment employing 300 or more workers must be
made compulsory for members of all registered trade unions. (6.73)
Commission also recommended that recognition once granted, should be valid
for a period of 4 years to be co-terminus with the period of settlement. No claim by
any other Trade Union / Federation / Center for recognition should be entertain till
at least 4 years have elapsed from the date of earlier recognition. (6.76)
67
Establishment employing 20 or more workers should have Standing Order or

Regulations. There is no need to delimit the issues on which Standing Orders can
or need be framed. As long as two parties agree all manner of things including
multi-skilling, production, job enrichment, productivity and so on can also be
added. The appropriate Government may prescribe a separate Model Standing
Orders for units employing less than 50 workers. The Commission has drafted a
draft Model Standing Orders in this regard. (6.77)
Every establishment shall establish a grievance redressal committee consisting
of equal number of workers and employers representatives. The said committee be
the body to which all grievance of a worker in respect of his employment will be
referred for decision within a given time frame (6.80).
Commission’s view
Commission’s view on Chapter V B (Special Provisions relating to Lay-off,
Retrenchment & Closure in the Establishments employing not less than 100
workmen) of the ID Act: The Commission has felt that, in the new circumstances of
global competition, it may not be possible for some enterprises to continue and
meet the economic consequences of competition. In such cases, one cannot compel
non-viable undertakings to continue to bear the financial burden that has to be
borne to keep the concern going. They should, therefore, have the option to close
down. In these circumstances, the commission came to the conclusion the best and
more honest equitable course will be to allow closure, provide for adequate
compensation tow workers and in the event of an appeal, leave it to the Labour
Relations Commission to find ways of redressal - through arbitration or
adjudication. (6.87)
Prior permission is not necessary in respect of lay-off and retrenchment in an
establishment of any employment size. Workers will however be entitled to 2
months notice or notice pay in lieu of notice, in case of retrenchment. The
commission also felt that the rate of retrenchment compensation should be higher
in a running organization than in an organization which is being closed. It would
however recommend that in the case of establishment employing 300 or more
workers where lay-off exceeds a period of 1 month such establishments should be
required to obtain post-facto approval of the appropriate government. The
Commission recommends that the provisions of Chapter V B pertaining to
permission for closure should be made applicable to all the establishments protect
the interest of workers in establishment which are not covered at present by this
provision if they are employing 300 or more workers.
Having regard to the national debate on the issue and the principles outlined
above the commission has recommended the compensation per completed year of
service @ of 30 days on account of closure in case of sick industry which has
continuously running to losses for the last 3 years and @ 45 days for retrenchment
by such sick industry or body where retrenchment is done with a view to become
viable. The commission also recommended higher retrenchment compensation @ 60
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days wages and similarly a high rate of compensation for closure @ 45 days wages
for every completed year of service for profit making organization. For establishment
employing less than 100 workers, half of the compensation mentioned above, in
terms of days of wages may be prescribed. However, notice is required to be given
for both the cases of retrenchment and closure as that of big industry. (6.88)
The commission has recommended for maintenance of panel of arbitrators
by LRC concern, to settle the disputes. (6.93)
The matters pertaining to individual workers, be it termination of employment
or transfer or any other matter be determined by recourse to the Grievance
Redressal Committee, conciliation and arbitration / adjudication by the Labour
Court. Accordingly, Sec.2 a of the ID Act may be amended. (6.96)
The system of legal aid to workers and trade unions from Public Fund be
worked out to ensure that workers and their organizations are not unduly
handicapped as a result of their inability to hire legal counsel. (6.98)
Strike should be called only by the recognized negotiating agent and that too
only after it had conducted a strike ballot among all the workers, of whom at least
51% of support the strike. (6.101).
Workers participation in management - the legislative teeth should be
provided. (6.102)
The commission urges that these recommendations are taken up as a whole
and not in a piece-meal manner that may destroy to context of inter-relation and
holistic approach. (6.104)
The provisions in respect of small establishments can be in the form of a
separate law name Small Enterprises (Employment Relation Act) or be included in
the general law as a separate chapter to ensure that the interest of the workers are
fully protected, even while lessening burden on the management and providing
them with vigilance in exercising managerial functions. (6.106)
Contract labour / Causal workers temporary workers
The Commission has recommended that contract labour shall not be engaged
for core production / service activities. However, for sporadic seasonal demand, the
employer may engage temporary labour for core production / service activity. As
mentioned by the commission that off-loading perennial non-core services like
canteen, watch and ward, cleaning, etc. to other employing agencies has to take
care of three aspects - (1) there have to be provisions that ensure that ensure that
perennial core services are not transferred to other agencies or establishments; (2)
where such services are being performed by employees on the payrolls of the
enterprises, no transfer to other agencies should be done without consulting,
bargaining (negotiating) agents; and (3) where the transfer of such services do not
involve any employee who is currently in service of the enterprise, the management
will be free to entrust the service to outside agencies. The contract labour will,
however, be remunerated at the rate of a regular worker engaged in the same
69
organization doing work of a comparable nature or if such workers does not exist in
the organization, at the lowest salary of a worker in comparable grade i.e. unskilled,
semi-skilled or skilled )6.109)
The Commission would recommended that no worker should be kept
continuously as a Casual or temporary worker against a permanent job for more
than 2 years. (6.110)
Employee wages
The Commission recommends that every employer must pay each worker his
one-month’s wage, as bonus before an appropriate festival, be it Dipawali or Oonam
or Puja or Ramzan or Christmas. Any demand for bonus in excess of this up to a
maximum 20% of the wages will be subject to negotiation. The Commission also
recommend that the present system of two wage ceilings for reckoning entitlement
and for calculation of bonus should be suitably enhanced to Rs.7500/- and
Rs.3500/- for entitlement and calculation respectively. (6.113)
There should be a national minimum wage that the Central Government may
notify. This minimum must be revised from time to time. It should, in addition,
have a component of dearness allowance to be declared six monthly linked to the
consumer price index and the minimum wage may be revised once in five years.
The Commission also recommends the abolition of the present system of notifying
scheduled employments and of fixing/revising the minimum rates of wages
periodically for each scheduled employment, since it feels that all workers in all
employments should have the benefit of a minimum wage. (6.114)
There is no need for any wage board, statutory or otherwise, for fixing wage
rates for workers in any industry. (6.118)
Working conditions
The Commission recommended enactment of a general law relating to hours of
work, leave and working conditions, at the work place. For ensuring safety at the
work place in different activities, one omnibus law may be enacted, providing for
different rules and regulations on safety applicable to different activities. (The
Commission have appended a draft indicative law on hours of work and other
working conditions after this chapter, and an omnibus draft indicative law on safety
in the chapter on Labour Administration). Such general law on working conditions
etc. may provide for the following (6.121):-
1. The law should have a provision for letters of appointment along with a copy of
Standing Orders of the establishment (in the local language); and issue of a
photo identity card giving details of the name of the worker, name of
establishment, designation, and so on.
2. It should specify the maximum number of working hours in a day/week, and
payment of overtime at double the rates of wages. The limitation on employing
workers on overtime needs to be relaxed, and the Commission recommended
that the present ceilings be increased to double to enable greater flexibility in
meeting the challenges of the market. Sub section (2) of Section 64 of the
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Factories Act contains a provision that the State Government can give
exemptions in certain circumstances. Sub section (2) of Section 64 of the
Factories Act contains a provision that the State Government can give
exemptions in certain circumstances. The Commission recommend that the
list of such contingencies may be suitably expanded in consultation with the
representatives of the industry to include more occupations, processes and
contingencies.
3. There should be reduced working hours for adolescents, prohibition of
underground work in mines for women workers, prohibition of work by women
workers between certain hours and so on.
4. On the question of night work for women there need not be any restriction on
this if the number of women workers in a shift in an establishment is not less
than five, and if the management is able provide satisfactory arrangements for
their transport, safety and rest after or before shift hours.
5. No exemptions like EPZ or SEZ from labour laws.
6. Appropriate government may be empowered to grant exemptions on case to
case basis.
7. Establishment having a man power over a specified limit must provide for a
canteen.
8. Other refreshment facilities exclusively based on gender be provided.
9. Irrespective of number of women workers, a creche should be provided.
10. Irrespective of number of women workers, a creche should be provided.
11. Deletion of Employers’ Liability Act, 1938, fatal accident act 1855 and relevant
provisions of these Acts may be incorporated into the W.C. Act, 1923. (6.26)
12. A provision may be made in the Laws that all cases must be disposed of in a
span of 3 hearings, disposal in 03 hearings and where this is not possible, the
Labour Court should in its award reasons for taming more hearings. The
Labour Relations Commissions may also be entrusted with the responsibility
to assess the work of the LCs particularly in the matter of expeditious disposal
of cases. With the constitution of an All India Labour Judicial Services that
the commission is recommending with a hope that have a dedicated and
competent set of man and woman as presiding officers of LCs who will be able
to discharge responsibilities efficiently and expeditiously. (6.139)
Social security
The Commission has suggested the recommendations on social security. The
main recommendations amongst the other are stated herein below:
 Our Commission accepts the need to consider social security as a fundamental
human right. (8.30)
 We recommend a system in which the State bears the responsibility for
providing and ensuring an elementary or basic level of security, and levels room
for partly or wholly contributory schemes. This will mean that the responsibility
to provide a floor will be primarily that of the State, and it will be left to
individual citizens to acquire higher levels of security through assumption of
71
responsibility and contributory participation. Such a system will temper and

minimize the responsibility and contributory participation. Such a system will
temper and minimize the responsibility of the State, and maximize the role and
share of individual and group responsibility. Thus, there will be three levels in
the system.
 The Task Force on Social Security recommended that ‘wage ceiling and
employment threshold can and should be uniform with a provision raising the
wage ceiling and its eventual removal and lowering employment threshold and
its ultimate removal. The Commission also agrees with it. (8.93)
 The term ‘workman’ may be replaced by the term ‘employee’ so as to make the
Workers’ Compensation Act applicable to all categories of employees; the term
‘employee’ may be
 Defined to mean any person employed in any employment specified in Schedule
II; the entries in Schedule II may be revised so as to make it applicable to all
classes of employee progressively; and restrictive clauses, wherever they occur
in the Schedule, may be omitted. (8.96)
 The workmen’s Compensation Act should be converted from an employers’
liability scheme to a social insurance scheme to a social insurance scheme, its
coverage should be progressively extended to more employments and classes of
employees, and the restrictive clauses in Schedule II of the Act should be
removed. (8.97)
 The management of ESI Scheme should be professionalized (8.113)
 The PF act be made applicable to all classes of establishment subject to such
exception. (8.117)
 The Commission suggests that EPFO organized an enquiry into the working of
all exempted funds by an independent agency and review the entire scheme of
granting exemptions from the provisions of the EPF Act. (8.126)
 The Payment of Gratuity Act may be integrated with EPF Act and converted into
a social insurance scheme. (8.149)
 An unemployment insurance scheme could play substantial role in coping with
unacceptable levels of employment resulting from the implementation of
structural adjustment programmes and other economic reforms. (8.175)
 The National Renewal Fund (NRF) was established in Feb-92 to provide a form
of wage guarantee which had to be used for re-training, re-deployment,
counseling etc. but in practice, NRF has mostly been utilized for implementing
the VRS. There is need to restructure this fund to serve as a wage guarantee
fund. (8.179)
 A provision is made for Payment of Educational Allowance to all employees
(8.482).
 The insurance companies be required to develop too or more plans providing
coverage for major risks faced by people leaving it to individual to choose from
among them according to their capacity. (8.242)
 A National Scheme for pension for physically handicap be introduced (8.365)
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 A National Scheme be drawn up for payment of pension to leprosy affected

persons, mentally sick people on the same lines as the pension for physically
handicap person. (8.380)
 Able bodied beggars should be given training and help to get employment.
(8.386)
 A permanent commission for disaster management should be set up on the
lines of election commission (8.393)
 The Commission strongly recommends the constitution of high powered
national security authority preferably under the Chairmanship of a Prime
Minister of India. (8.415)
 A social security fund of India and social security of each State may be set up.
(8.433)
 There will be three kinds of social security schemes: 1) social insurance type of
contributory scheme, 2) subsidized insurance / welfare fund type of partly
contributory and partly socially assisted schemes and 3) social assistance
scheme which will be wholly non-contributory. (8.343)
Other Recommendations
 The recommendations on women & child labour
 Recommendation on skill development
 Labour Administration
 Workers participation in management
 Employment scenario in the country
 Review of wages and wage policy
 Labour statistic and research work.
ILO is involved in formulation of international policies and programmes to
promote basic human rights, improve working condition and enhance employment
opportunities.
ILO helps in creation of international labour standards backed by unique
system to supervise their application.
Develop an extensive programme of International Technical Co-operation
formulated and implemented in an active participation with constituents to help
countries put these policies into practice in an effective manner.
1. What are the main recommendations of commission on social security?
2. Discuss the commission view on Chapter V of ID Act.
11.6 SUMMARY
The commission in its 2700 pages long report inter - alia has stressed on
Bilateral agreement, collective Bargaining and identification of parties to bargain
and for recognition. review on existing provisions in the Trade Union Act with
Regard to Recognition / Registration of Trade Union.
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1. Discuss the Recommendation of Commission on contract labour / causal
workers.
2. Discuss the chapters of recommendation of the commission.
3. There should be Reduced working hours for __________ Adolescent / Aged
worker based on the Recommendations.
4. Commission Recommends no worker should be kept continuously as a
casual brokers against a permanent job for more than __________ (2 year /
1year)
1. Butler Arthur, D., “Labour Economics and Institutions”, 1961.
2. Richardson, J.H. “An Introduction to the study of Industrial Relations”, 1954.
3. Webb, Sydney and Beartrice, Industrial Democracy, 1902.
11.9 ASSIGNMENTS
1. Read recommendations on women and child labour on labour administration.
2. Read recommendations on women an child labour on review of wages and
wage policy.
1. N.G.Nair, “Personnel Management and Industrial Relations”, 2012.
2. Personnel Management and Industrial Relations by P.C.Tripathi.
3. R.C.Saxane “Labour Problems and Social Welfare”, 1981.
1. Find out the recommendations made in PF Act
2. What recommendation are made in workers participation in management?
11.12 KEY WORDS
1. Work stoppage
2. Industry
3. Arbitrators.
4. Strikes
5. Workmanl

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LESSON - 12
MEANING OF FATIGUE - MONOTONY AND BOREDOM - METHOD

FOR REDUCING FATIGUE
12.1 INTRODUCTION
The psychological state characterized by diminished capacity to perform and
usually accompanied by a feeling of tiredness. It normally results from exertion
beyond one’s normal ability, but may also be caused or aggravated by ill health,
physical and emotional aspects of the work environment, worries or mental conflict.
12.2 OBJECTIVES
 What is fatigue and what are its characterized?
 Symptoms of fatigue and causes of fatigue?
 Types of fatigue and methods to reduce it?
 What is monotony?
 What is Boredom?
 Fatigue and Boredom
 Measurement of fatigue
 Methods to reduce Boredom, Monotony.
12.3 CONTENTS
Fatigue is defined as decrease in the capacity of a person to carry out the work
because of previous work.
A decline in curve of production is often attributed to a worker’s fatigue. That
is why fatigue elimination is of interest to both employer and employee. The
employer being obviously interest in arresting the decline in production and the
employee being eager to rid himself of the feeling of tiredness experience in fatigue.
Fatigue may be both physical and mental. Physical fatigue occurs when the
physical fatigue occours when the physical efficiency gets reduced and physical co-
ordination becomes difficult. Physical fatigue is characterized by the conditions of
the muscles, chemical changes, heart beat rate, blood pressure.
Sometimes a pension feels fatigue even without having done any physical
work. The Reason is mental fatigue.
The mental fatigue results from back of motivation to do any work, back of
interest, inability to concentrate and overall back of efficiency.
The main component of mental fatigue is attitudinal.
Symptoms of fatigue
It is simple tiredness, changes in the brain, nerve and muscle cells functions
are change. There are three aspects of fatigue which is feeling of tiredness, decline
in output for a given level of effort and physiological change.
Causes of fatigue are varied. They are poor quality of Raw materials, absence
of strong physique of employee, poor lighting, ventilation and heavy noise.
Bureaucratic organization structure and allotment of work to the employee in
which he is not interested.
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The types of fatigue are physiological fatigue psychological fatigue and nervous
fatigue industrial psychology arms to reduce the effects of fatigue in workers by
introducing more efficient work methods, proper training and effective motivation
and thereby maintain or increase production and job satisfaction.
Monotony is a state of mind caused by performing repetitive tasks. It implies
no emotional dislike. Job enlargement mostly causes monotony. Monotony is a
state of mind or an attitude of a worker towards his job. Monotony is caused even if
the worker is not tired mentally and or physically.
Boredom is caused due to task of interest or aptitude in the job. It is
characterized by depression and a disease for change of activities. Boredom is
tinged with emotional distaste and is accompanied by a corresponding attitudinal
outlook. Boredom is heavily affected by factors like personality, attitude aptitude or
interest pattern rather than doing repetitive tasks.
Fatigue and Boredom
Fatigue is reduced capacity for doing work / carrying out the activities.
Boredom is lack of interest or decreased interest in a particular work/activity. All
workers experiences fatigue. Some workers only experience boredom. Fatigue can
be reduced but cannot be prevented. Boredom can be prevented if work is assigned
based on the interest.
Measurement of fatigue
Angelo Masso Developed an instrument called ergograph which helps to
investigate the relation between fatigue and work in a relatively isolated part of the
body.
The principle of ergograph is that all fingers except middle are similarly
immobilized. A string is then fastened to the free finger which is to be put to work.
The free finger can be made to pull against the load by placing the load on the other
side of the string.
A recording device is fastened to the moving string in order to obtain the graph
of the output.
Though there are differences among fatigue, Boredom and monotony, they
affect employee and the organization more or less similarly.
Measures to reduce fatigue, Boredom and monotony:
Reduction in working hours, rest pauses and flexi working schedule, train
workers to eliminate unnecessary motions.
Fatigue is defined as a reduced capacity for more work as a consequence of
prolonged exposure to work. Fatigue may be both physical and mental. Helmholtz
invented the myograph used to measure the contractor of muscles which is used to
measure fatigue. Physical fatigue is characterized by conditions of muscles, blood
composition, oxygen consumption. The mental fatigue results in lock of motivation
to do any work, back of interest, ............to concentrate. Industrial psychology aims
to reduce the effects of fatigue in workers by introducing more efficient work
methods, proper training and effective motivation.
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1. What is fatigue? Explain the symptoms of it.
2. Discuss the causes of fatigue and types o fatigue.
3. What is monotony?
4. What is Boredom?
5. How do you measure fatigue of an worker?
6. Discuss the measures to reduce fatigue, boredom and monotony.
12.6 SUMMARY
Fatigue is defined as reduced capacity for more work as a consequence of
prolonged. Exposure to work fatigue may be physical and mental. Some person feel
fatigue even without having done any physical work. Boredom is caused due to lack
of interest or aptitude in the Job. It is characterized by depression and a desire for
change of activities. Fatigue can be reduced but can’t be prevented. Boredom can
be prevented if work is assigned based on the interest.
1. Discuss the ways and means of fatigue and boredom reduction in an organization.
2. __________ workers experience fatigue (All/Some)
3. ___________ workers experience boredom (All/Some)
4. ___________ leads to increase in absenteeism, labour turnover and accidents
(Boredom/Fatigue/Monotony)
5. __________ is affected by factors like personality, attitude, aptitude
(Boredom/Fatigue)
1. John Bratton and Jeffrey Gold, “Human Resources Management”.
2. R.C.Saxena, “Labour problems and social welfare”, 1981.
3. A.M.Sharma, “Aspects of Labour welfare and social security, “Himalaya Publishing
House”, 2013.
12.9 ASSIGNMENTS
1. Does age and experience has any relation to boredom and fatigue? Discuss.
2. Go round your town. Find out how many industries have trained employees to
overcome boredom and fatigue? Discuss why industries have not taken / taken
any efforts in this line.
1. R.C.Saxena “Labour problems and social welfare”, 1981.
2. Personnel management and industrial relations by P.C. Triapthi.
3. Michael Armstrong OP. cit
4. Ibid P.96
1. Does organization has boredom relieving centres?
2. Sit with industrial worker. Find out under what situations and circumstances
does fatigue occours and how frequently it occours and why?
12.12 KEY WORDS
1. Fatigue 3. Monotony 5. Psychological
2. Boredom 4. Attitudinal 6. Nervous

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UNIT – IV
LESSON - 13
SIGNIFICANCE OF OCCUPATIONAL, HEALTH OCCUPATIONAL

HAZARDS & DISEASES - PROTECTION AGAINST HEALTH
HAZARDS
13.1 INTRODUCTION
The origin of Industrial Hygiene and health are based on limiting worker
exposure to chemicals and have evolved to address most other work place hazards
including over - exposure to noise, heat, cold, vibrations and repetitive motions.
Every occupation has its own Hazards. An Industrial worker can be exposed to
five types of occupational Hazards viz; physical Hazards, chemical Hazards,
biological Hazards, Mechanical Hazards and Psychological Hazards depending on
his occupation.
13.2 OBJECTIVES
After Reading this chapter you will be able to understand
 Significance of health care services.
 Objectives & Role of occupational health services.
 Types of occupational Hazards.
 Occupational Diseases & types.
 Diseases (Protective) Measures for occupational
13.3 CONTENTS
Significance of Health care services
Early intervention, clinical assistance and the proactive management of employees’
health and care issues can successfully
 Reduce absenteeism and absence-related costs (sick pay/cover/overtime) and
encourage people back to work sooner;
 Identify and help rectify the reasons for poor performance;
 Reduce the impact on pension scheme funds (such as early retirement due to
sickness);
 Prevent work-related ill health;
 Facilitate early return to work;
 Effectively manage absence;
 Maintain competitiveness and productivity;
 Meet statutory obligations;
 Achieve significant cost savings;
 Enable employers to make informed decisions on employee performance and
absence issues;
 Boost staff performance, productivity and profitability; and
 Reduce employee risk, minimize insurance claims and lower premiums.
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Objectives of occupational Health Services

The occupational health service in an industry should aim at
1. Protecting the workers against health hazards which may arise out of their
work or the conditions in which it is carried on; and
2. contributing towards worker’s physical and mental adjustments, and
establishment and maintenance of the highest possible degree of physical
and mental well-being.
Role of occupational Health Services
The role of occupational health service should be essentially preventive. It should
be able to
1. Identity occupational hazards and suggest measures for their control;
2. Detect occupational or other diseases and give initial treatment;
3. Render advice about the placement of people in suitable work;
4. Provide necessary advice relating to the supervision of conditions at work
which may influence health and general sanitation; and
5. Undertake health education.
The occupational health service at work should vary according to the size of
the work group, the hazards involved, the location of the plant, and many other
factors. The object should be to set up a preventive occupational health covers a
very wide field and calls for specialized knowledge from many disciplines such as
medicine, engineering, chemistry, toxicology, physiology, statistics, and above all a
close interdisciplinary team work.
Occupational Hazards
Every occupation has its own hazards. One should take adequate and proper
precautions for protection. To have proper safety and precautionary measure
against occupational hazards is the fundamental right of all workers. the
constitution of India give huge priority to the occupational hazards and its safety.
Types of occupational Hazards
An industrial worker can be exposed to the following five types of hazards,
depending this occupation
1. Physical hazards
2. Chemical hazards
3. Biological hazards
4. Mechanical hazards
5. Psychological hazards
1. Physical hazards: Following are the major types of hazards:
(a) Heat and Cold: Heat is common hazard in most industries in India. Many
industries have local ‘hot spots’ - ovens and furnaces, which radiate heat. Radiant
heat is the major problem in foundries, glass and steel industries, whereas heat
stagnation is the major problem in jute and cotton textile industries. Physical work
79
under such conditions is highly stressful, and impairs and health and efficiency of
the workers. Heat may cause burns, heat strokes, heat cramps, fatigue and
increased accident rates. The recommended comfortable temperature in our
country is 690 to 800 F. Similarly, there are important hazards associated with cold,
such as chilblains, erythrocyanosis, and immersion foot.
(b) Light: Poor illumination or excessive brightness at the workplace may
cause eyestrains, headaches or glare with discomfort and fatigue that may result in
accidents. There should be sufficient and suitable lighting, natural or artificial,
wherever persons are working.
(c) Noise and vibration: Noise is a health hazard many industries. The effects
of noise are of two types: (i) auditory effects which consist of temporary or
permanent hearing loss, (ii) non-auditory effects which consist of nervousness,
fatigue, interference with communication by speech, decreased efficiency and
annoyance. Noise could be reduced to the minimum safe levels. Where noise cannot
be avoided, noise defenders should be provided. Vibration usually affects the hands
and arms. After long period of exposure, the blood vessels may become increasingly
sensitive to spam (white fingers). Exposure to vibration may also produce injuries to
the joints of the hands, elbows and shoulders.
(d) Ultraviolet radiation and ignozing radiation: Where welding arcs, X-ray
or radioactive isotopes are used, exposure to radiation may cause welders-flash,
that is, redness, of eyes and pain, genetic disorders, cancer, leukaemia, sterility,
and in extreme cases death.
2. Chemical hazards
The chemical hazards are on the increase with the introduction of newer and
complex chemicals. Exposure to industrial chemicals may cause skin diseases,
allergy, cancer, and the like. Common industrial chemicals which cause lung
diseases are machine oils, rubber, acids, alkalis. Ingestion of lead, zinc, and arsenic
may cause poisoning. Wearing of rubber gloves and safe handling will prevent ill-
effects.
3. Biological hazards
Workers may be exposed to ineffective and parasitic agents at the place of
work. The occupational diseases in this category are brucellosis, anthrax,
psittacosis, tetanus, fungal infections and host of others. Persons working among
animals and those engaged in the manufacture of animal products (e.g., hair wool,
hides) and agricultural workers are particularly exposed to these hazards.
4. Mechanical hazards
They may be due to protruding machinery and from moving parts of
machinery, fire, explosion and electricity.
5. Psychological hazards
Such hazards may arise from lack of job satisfaction, emotional tension,
frustration, insecurity and poor human relationships. It may be due to the worker’s
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inability to live in harmony with the environment at his place work. These factors
may undermine both physical and mental health of the workers. Psychological
hazards are now assuming more importance than physical or chemical hazards.
Based on the past industrial experience, the American Conference of
Government Industrial Hygienists have laid down the safe limits or Threshold Limit
values (TLV) for over 400 industrial chemicals and dusts. It has been accepted that
if the concentration in the working environment is kept within these limits, the
workers’ health will not be affected, even after many years of work in that
environment.
Occupational Diseases
Occupational diseases are those arising out of or in course of employment. In
other words, it is a health problem caused by exposure to a workplace health
hazard. Workplace should, therefore, be healthy for body and mind of workers.
Occupational diseases are defined as the illness caused by the substances or
conditions that the worker was brought into contact with at the workplace or while
he was working at his respective work environment.
The following workplace health hazards can cause occupational diseases:
1. Dust, gases or fumes
2. Noise
3. Toxic Substances (poisons)
4. Vibration
5. Radiation
6. Infectious germs or viruses
7. Extreme hot or cold temperatures
8. Extremely high or low air pressure.
Types of Occupational Diseases
An industrial worker can be exposed to the following twelve types of
occupational diseases, based upon his occupation:
1. Lead Poisoning
Lead is a highly toxic metal. More industrial workers are exposed to lead than
to any other toxic metal. Workers who are likely to be affected by exposure to lead
are cable-makers, lead pipe-makers, compositors, painters and plumbers. The
harmful effects are caused by inhalation of the dust or fumes of lead and lead
compounds. Early symptoms of lead poisoning are loss of appetite, nausea,
vomiting and stomach pains. In chronic form, it results in headache, muscular and
joint pains, anaemia and intestinal disorders.
2. Phosphorus poisoning
Yellow phosphorous is poisonous. It is used in the manufacture of certain
types of explosives. It enters the body in the form of fumes and has destructive
action on the bones, especially of the jaw. Early signs of phosphorous poisoning are
toothache and pain in the jaw.
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3. Mercury poisoning
Mercury is a highly poisonous substance, and when inhaled, causes toxic effects.
Barometer and thermometer makers, laboratory workers, electric meter repairers,
refiners of gold and silver are normally the persons who come in frequent contact with
this substance. Long and continued inhalation of even small amount of mercury
vapour affects the brain. Absorption of mercury through skin causes eczema.
4. Manganese poisoning
Manganese dioxide is poisonous. Inhalation and absorption of its dust of
fumes results in inflammation of lungs. Manganese miners, ferro-manganese
workers and dry cell battery makers are likely to be affected by it.
5. Anthrax
This is a disease of animals. Men engaged in handling wool, hair bristles or
animal carcases or their parts including hides, hoofs and horns are likely to be
affected by it. The germs enter the skin through a cut or scratch on it. Woollen
carpet makers, tannery workers and wool sorters should be careful about it.
6. Silicosis
It is caused by inhaling dust containing silica. Silica is present in rocks, clays,
common sand and sandstones. Workers in potteries and ceramics, metal grinding,
refectories, slate pencil mines and similar such occupations are effected by it. It
gradually eats away the lungs causing respiratory trouble in the beginning and
ends in spitting of blood and a painful death. This disease is incurable.
7. Asbestosis
It affects workers engaged in handling and crushing of crude asbestos, and
making of asbestos mattresses.
8. Bagssois
It is an occupational disease of the lungs caused by inhalation of bagasse or
sugar cane dust. The symptoms consist of breathlessness, cough haemoptysis, and
slight fever. The preventive measures for bagassois are dust control, personal
protective equipment and periodic medical examination.
9. Coal miner’s pneumoconiosis
It may be caused due to employment in coal mining.
10. Telegraphists cramp
Telegraphists suffer from this disease because of the degree of accuracy, speed
of work and concentration required for the job.
11. Caisson disease
Those working caisson on harbour construction or in the building of tunnels
may suffer from this disease. It occurs when certain harmful gases get dissolved in
blood cells.
12. Byssionosis
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It affects the lungs of the textile workers due to inhalation of cotton fibre dust
over a long period of time.
13. Skin disease
These disease are caused by such irritants as acids, solvents, bases and the
like.
Protective Measures for Occupational Diseases
There are two aspects of preventive and curative measures for occupational
diseases:
1. Preventive measures
2. Curative measures.
1. Preventive measures
Preventive measures include:
(a) Pre-employment and periodic medical examination
(b) Removal of health hazards to the extent possible;
There are five different types of occupational Hazards like Physical Hazards,
chemical Hazards Biological Hazards, Mechanical Hazards & psychological Hazards
based on his occupation. An Industrial worker is exposed to various occupational
diseases like lead poisoning, phosphorous poisoning, Mercury poisoning,
Manganese poisoning & Skin Diseases.
1. What are the different types of occupational diseases?
2. What are the various types of occupational hazards?
3. Define occupational disease.
4. What are the objectives of occupational Health service.
13.6 SUMMARY
Occupation has its own Hazards. One should take adequate & proper
precautions for protection. Occupational health deals with work related disorders
and all factors that affect community health within it. Working conditions and
employment has major implications for employee health. Occupational disease is a
health problem caused by exposure to work place health hazard. Work place should
therefore be healthy for Body & Mind of workers.
1. Find out the Recommendations of National Commission on Labour against
health Hazards.
2. “Prevention is Better than Cure of an occupational Diseases”? Discuss.
1. Arun Kumar, Rachana Sharma, Personnel management, Theory and Practice.
2. T.N. Chhabra, R.K.Suri, Industrial Relations concepts & Issues.
3. P.Sravanavel - Labour Legislation.
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4. HRD News Letter,

5. Kapoor T.N. Personnel Management & Industrial Relations India.
13.9 ASSIGNMENTS
Go around you Town. List out the various industrial establishments a
available, find out occupational Hazards & Diseases that employees who work there
are facing.
1. Personnel Management & Industrial relations By P.C. Tripathi
2. Lyons T.P., The Personnel Function in changing Environment.
3. Industrial Relations, Labour welfare & Labour Laws By B.Nandha Kumar
4. Indian Journal of Industrial Relations
5. Labour Chronicle
13.11 LEARNING ACTIVITY
1. Find out the various occupational Hazards & diseases that have affected
industrial worker in India over the past 10 years.
12. KEY WORDS
1. Hazards
2. Occupational
3. Diseases
4. Preventive
5. Curative
6. Radiation

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LESSON - 14
STATUTORY PROVISIONS UNDER FACTORIES ACT 1948

14.1 INTRODUCTION
In common parlance, invariably Factory & Industry are understood as Inter
changeable. This is incorrect. The existing law relating to regulation of labour
employed in Factories in India is embodied in Factories Act 1934. Experience of
working of the Act has received a number of defects and weaknesses which hamper
effective administration. Although the Act has been amended in certain Respects in
a piecemeal fashion when ever some particular aspect of Labour safety or welfare
assumed urgent importance, the general frame work has remained unchanged. The
provisions for the safety, health and safety, health and welfare of workers are
generally found to be inadequate and unsatisfactory and even such protection as is
provided does not extend to the large and growing industrial activities in the
country.
14.2 OBJECTIVES
After Reading the chapter you should be able to:
 Understand the statement of objects, reasons and definition of factories Act.
 Know the duties and responsibilities of Inspector of factories.
 Understand the health, welfare and safety provisions.
14.3 CONTENTS
Health Provisions
Under the Factories Act, 1948, and the rules framed thereunder, the
employers have to make sure health provisions such as general cleanliness of the
workplace, disposal of wastes and effluents, ventilation and temperature, dust and
fume, artificial humidification, lighting, drinking water, conservancy arrangements
and spittoons.
1. Cleanliness
Section II of the Factories Act, 1948 provides for general cleanliness of the
factory. It lays down that dust, fumes and refuse should be removed daily; floors,
staircases, and passages should be cleaned regularly by sweeping and other
effective means while washing of interior walls and roofs should take place at least
once in 14 months, and where these are painted with washable water paint, be
repainted after every three years and where oil paint is used at least once in five
years. Further, all doors and window frames and other wooden or metallic
framework and shutters should be kept painted or varnished and the painting or
varnishing shall be carried out at least once in five years.
2. Disposal of wastes and effluents
Section 12 of the Factories Act makes it obligatory on the owner of every
factory to make effective arrangements for the treatment of wastes and effluents
due to the manufacturing process carried on therein, So as to render them
innocuous for their disposal.
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3. Ventilation and temperature

The occupier is required to make effective and suitable provisions for securing
and maintaining in every workroom adequate ventilation for the circulation of fresh
air and to maintain such temperature as will secure to workers reasonable
conditions of comfort and prevent injury to health.
4. Dust and Fume
Section 14(1) deals with the measures, which should be adopted to keep the
workrooms free from dust and fume. Every factory in which by reason of the
manufacturing process carried on, there is given off any dust of fume or other
impurity of such a nature and to such an extent as is likely to be injurious or
offensive to the workers employed therein, or any dust in substantial quantities,
effective measures shall be taken to prevent its inhalation and accumulation in any
workroom. If any exhaust appliances is necessary for the above purpose, it shall be
applied as near as possible to the point of or origin of the dust, fume or other
impurity and such point shall be enclosed as far as possible.
5. Artificial humidification
Section 15(1) lays down that in respect of all factories in which the humidity of
the air is artificially increased, the State Government may make rules
a) Prescribing standard of humidification;
b) Regulating the methods used for artificially increasing the humidity of the air;
c) Directing prescribed tests for determining the humidity of the air to be correctly
carried out and recorded;
d) Prescribing methods to be adopted for securing adequate ventilation and
cooling of the air in the workroom; and
e) Overcrowding.
To control overcrowding, the Factories Act prescribed that no room of any
factory shall be overcrowded to the extent that it becomes injurious to the health of
the workers. The Act further prescribes that in every workroom, each worker should
be provided with a minimum space of 9.9 cubic meters which was there on the
commencement on this Act in 1948 or 4.2 cubic meters after such commencement
(Section 16).
6. Lighting
Section 17(1) provides that in every part of the factory, where workers are
working or passing, there shall be provided and maintained sufficient and suitable
lighting, natural or artificial or both.
7. Drinking water
Section 18 deals with the provisions relating to arrangements for drinking
water in factories. Subsection (1) provides that in every factory, effective
arrangements shall be made to provide and maintain at suitable points
conveniently situated for all workers employed therein, a sufficient supply of
wholesome drinking water.
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8. Conservancy arrangements
Section 19 provides that, in every factory, there shall be provided and
maintained, separate arrangement for toilets for and female workers at convenient
places. These should be adequately lighted, ventilated and maintained in a clean
sanitary condition.
9. Spittoons
Section 20(1) lays down that in every factory, there shall be provided a
sufficient number of spittoons convenient places. They shall be maintained in a
clean and hygienic condition.
Safety Provisions
Provision of safety inside the workplace under the Factories Act provide for
ensuring sufficient guidelines for fencing of machinery, work on or near machinery
in motion, employment of young person’s on dangerous machine, striking gear and
devices for cutting off power, self-acting machines, casing of new machinery,
prohibition of employment of women and children near cotton openers, hoists and
lifts, revolving machinery, pressure plant, pits, sump and opening in floors,
precautions against dangerous fumes and gases, precautions against using
portable electric light, explosive or inflammable materials, precaution in case of fire,
safety of building and machinery, maintenance of buildings, and the appointment
of safety Officers in factories. The statutory requirements in the Act are enforced by
the factory inspectorates set up in the State for the purpose. The above said safety
provisions are explained broadly as below.
1. Fencing of machinery
Section 21(1) requires that in every factory, the following must be securely fenced
by safeguards of substantial construction while the machinery are in motion or use:
1. Every moving part of prime mover, whether the prime mover or flywheel is in
the engine house or not
2. The headrace and tailrace of every waterwheel and water turbine
3. Any part of stockbar which projects beyond the head stock of lathe
4. Unless they are in such position or of such construction as to be safe to every
person employed in the factory as they would be if they were securely fenced,
the following, namely,
5. Every part of electric generator, a motor or rotary converter;
6. Every part of transmission machinery; and
7. Every dangerous part of any other machinery.
shall be securely fenced by safeguards of substantial construction which shall
be consistently maintained and kept in position while the parts of machinery they
are fencing are in motion or in use.
2. Work on or near machinery in motion
Section 22(1) requires that it is essential to examine any part of the machinery
(referred in Section 21) while it is in motion or as a result of such examination. It is
necessary to carry out
1. Lubrication or other adjusting operation; or
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2. Any mounting or shipping of belts or lubrication or other adjusting operation.

Such examination or operation shall be made or carried out only by a specially
trained adult male worker wearing tight-fitting clothing (which shall be supplied by
the occupier) whose name has been recorded in the register prescribed in this
behalf and who has been furnished with a certificate of his appointment, and while
he is so engaged
a) Such worker shall not handle a belt at a moving pulley unless
i) The belt is not more than fifteen centimetres in width;
ii) The pulley is normally for the purpose of drive and not merely a flywheel or
balance wheel (in which case a belt is not permissible);
iii) The belt joint is either laced or flushed with the belt;
iv) The belt, including the joint and the pulley rim, are in good repair;
v) There is reasonable clearance between the pulley and any fixed plant or
structure;
vi) Secure foothold and, where necessary, secure handhold, are provided for
the operator; and
vii) Any ladder in use for carrying out any examination or operation aforesaid
is securely fixed or lashed or is a firmly held by a second person.
b) Without prejudice to any other provision of this Act relating to the fencing of
machinery, every set screw, bolt and key on any revolving shaft, spindle, wheel,
or pinion, and all spur, worm and other toothed or friction gearing in motion
with which such contact.
3. Employment of young persons on dangerous machine
Section 23 prohibits the employment of a young person on dangerous machine
unless he has been fully instructed as to the dangers arising from machine and the
precautions to be observed, and (i) has received sufficient training in work at the
machine, or (ii) is under adequate supervision by a person who has a through
knowledge and experience of the machine.
Section 10 of the Factories Act stipulates the appointment of certified surgeons
by the State Government. Qualified practitioners are appointed as certified
surgeons and they are required to carry out such duties as
a) Examination and certification of young person’s;
b) Examination of persons engaged in factories which have dangerous
occupations or processes as may be prescribed; and exercising medical
supervision.
4. Striking gear and devices for cutting off power
In order to move the driving belt from pulleys in transmission machine and to
prevent the belt from creeping back into the fast pulley, suitable striking gear or
other efficient mechanical appliance shall be provided, maintained and used. No
driving belt when unused shall be allowed to rest or ride upon shafting in motion.
Suitable devices are also maintained in every workroom for cutting off power
emergencies.
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5. Self-acting machines
Section 25 of the Factories Act provides further safeguards to the workers
injured by self-acting machines. It provides that no traversing part of self-acting
machine in any factory and no material carried thereon shall, if the space over
which it runs is a space over which any person is liable to pass, whether in the
course of his employment or otherwise, be allowed to run on its outward or inward
traverse within a distance of forty-five centimeters from any fixed structure which is
not part of the machine.
6. Casting of new machinery
Section 26(1) provides that in all machinery driven by power, after the
commencement of the Factories Act, 1948, every set screw, bolt or key on any
revolving shaft, spindle, wheel or pinion shall be sunk, encased or effectively
guarded as to prevent danger (Section 26(20). Further, all spur, worm and other
toothed or friction gearing not requiring frequent adjustment while in motion shall
be completely encased, unless they are safely situated. Furthermore, Section 26(2)
provides that, whoever sells or lets on hire or, as agent of the seller or hirer, cares
or procures to be sold or let on hire, for use in a factory any machinery driven by
power which does not comply with the provisions of Subsection (1), or any rules
made under Subsection (3), shall be punishable with imprisonment for a term
which may extend to three months or with fine which may extend to Rs.500, or
with both. Under the act, the State Government is empowered to make rules for the
safeguards to be provided from dangerous part of the machinery.
7. Prohibition of employment of women and children near cotton openers
The Factories Act prohibits the employment of women and children in any part
of the factory for pressing cotton where the cotton opener is at work. But if the feed-
end of cotton opener is in a room separated from the delivery and by a partition
extending to the roof or to such heights as the Inspector may in any particular case
specify in writing, women and children may be employed on the side of the partition
where feed-end is situated (Section 27).
8. Hoists and lifts
Section 28(1) requires that hoists and lifts must be of good mechanical
constructions, sound material and adequate strength. They should not only be
properly maintained but also thoroughly examined at least twice a year by
competent personal.
9. Revolving machinery
Section 30(1) provides that a notice indicating the maximum safe working
peripheral speed of the grindstone or abrasive wheel, the speed of the shaft, or
spindle, must be permanently affixed on all rooms in a factory where grinding is
carried on and the speeds indicated in notices under Subsection (1) shall not be
exceeded (Subsection (2) of Section 39). Similarly, care should be taken not to
exceed the safe working peripheral speed of every revolving machine like revolving
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vessel, cage, basket, flywheel, pulley, disc or similar appliances run by power
(Subsection (3) of Section 30).
10. Pressure Plant
Section 31 (1) provides that effective measures should be taken ensure safe
working pressure of any part of the plant or machinery used in the manufacturing
process operating at a pressure above the atmospheric pressure.
11. Pits, sump and opening in floors
Section 33(1) of the Factories Act, requires that every fixed vessel, sump, tank,
pit or opening in the ground or in the floor in every factory should be covered or
securely fenced, it by reason of its depth, situation, construction or contents, they
are or can be a source of danger.
Section 33(2) empowers the State Government to grant exemption from
compliance of the provision of this Section
i) In respect of any item mentioned in the Section;
ii) To any factory or class of factories, and
iii) On such condition as may be provided in the rules.
12. Precautions against dangerous fumes and gases
In order prevent factory workers against dangerous fumes, special measures
have been taken under the Factories Act. The Act prohibits entry in any chamber,
tank, vat, pit, pipe, flue, or other confined space in any factory in which any gas,
fume, vapour or dust is likely to be present, to such an extent as to involve risk to
persons being overcome thereby, except in cases where there is a provision of a
manhole of adequate size or other effective means of egress. [Section 36(1)]. No
person shall be required or allowed to enter any confined space as is referred to in
Subsection (1) until all practicable measures have been taken to actually remove
the gas, fumes or dust, which may be present so as bring its level within the
permissible limits and to prevent any ingress of such gas, fume, vapour or dust
[Section 36(2)].
13. Precaution against using portable electric light
The Act prohibits any factory from using portable electric light or any other
electric appliance of voltage exceeding 24 volts in any chamber, tank, vat, pipe, flue
or other confined space unless adequate safety devices are provided [Section
36A(a)]. The Act further prohibits the factory from using any lamp or light (other
than that of flame-proof construction) if any inflammable gas, fume or dust is likely
to be present in such chamber, tank, vat, pipe, flue or other confined space.
[Section 36A(b)].
14. Explosive or inflammable materials
Measures to prevent accidents from these materials include
i) Erecting effective enclosures of the plant or machinery used in the process;
ii) Removal or prevention of the accumulation of such dust, gas or varpour;
and
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iii) Exclusion of effective enclosure of all possible sources of ignition [Section

17(i)].
15. Precaution in case of fire
In every factory, all practical measures shall be taken to prevent outbreak of
fire and its spread, both internally and externally, and to provide and maintain (i)
safe means of escape for all persons in the event of fire, and 9ii) the necessary
equipment and facilities for extinguishing fire. Further, effective measures should
be taken to ensure that in every factory all the workers are familiar with the means
of escape in case of fire and the workers be trained in the routing to be followed in
such case (Section 38).
16. Safety of building and machinery
If its appears to the Inspector that any building or part of building or any part
of the ways, machinery or plant in a factory is in such a condition that it is
dangerous to human life or safety, he may serve on the occupier or manager (or
both) of the rectory an order in writing specifying the measures which in his
opinion should be adopted and requiring them to be carried out before a specified
date [Section 40(1)].
17. Maintenance of buildings
In order to ensure safety, the inspector is empowered to serve on the occupier
or manager (or both) of the factory an order specifying the measures to be taken
and requiring the same to be carried out if it appears to him that any building or
part of a building in a factory is in such a state of disrepair as is likely to lead to
conditions detrimental to the health and welfare of the workers (Section 40A).
18. Safety officers
In order to prevent accidents, the Act provides for the appointment of Safety
Officers in factories employing 1,000 or more workers, or where any manufacturing
process or operations are carried on, which involves any risk of bodily injury,
poisoning or disease, or any other hazard to health, to the persons employed in the
factory. (Section 40B).
Hazardous Process
Section 2 (cb) of the Factories (Amendment) Act, 1987, defines the term
‘hazardous process’ as any process or activity in relation to an industry specified in
the First Schedule where, unless special care is taken, raw materials used therein
or the intermediate or finished products, by-products, wastes or effluents thereof
would
a) Cause material impairment to the persons engaged in or connected therewith,
or
b) Result in the pollution of the general environment.
The State Government may, by notification in the Official gazette, amend the
First Schedule by way of addition, omission or variation of any industry specified in
the said Schedule. Let us discuss some of them.
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1. Constitution of Site Appraisal Committee

a) The State Government may, for the purpose of advising it to consider
applications for grant of permission for the initials location of a factory involving
hazardous process or for the expansion of any such factory, appoint a Site
Appraisal Committee consisting of:
i) The Chief Inspector of the State who shall be its Chairman;
ii) A representative of the Central Board for the Prevention and Control of
Water Pollution appointed by the Central Government under Section 3 of
the Water (Prevention and Control of Pollution) Act, 1974;
iii) A representative of the Central Board for the Prevention and Control of Air
pollution referred to in Section 3 of the Air (Prevention and control of
Pollution) Act, 1981;
iv) A representative of the State Board appointed under Section 4 of the Water
(Prevention and Control of Pollution) Act, 1974;
v) A representative of the Central Board for the Prevention and Control of Ari
Pollution referred to in Section 5 of the Air (Prevention and Control of
Pollution) Act, 1981;
vi) A representative of the Department of Environment in the State;
vii) A representative of the Meteorological Department of the Government of
India;
viii) An expert in the field of occupational health; and
ix) A representative of the Town Planning Department of the State
Government, and not more than five other members who may be co-opted
by the State Government who shall be
x) A scientist having specialized knowledge of the hazardous process which
will be involved in the factory;
xi) A Representative of the local authority within whose jurisdiction the
factory is to be established; and
xii) Not more than three other persons as deemed fit by the State Government.
b) The Site Appraisal Committee shall examine an application for the establishment
of a factory involving hazardous process and makes it recommendations to the
State Government within a period ninety days of the receipt of such application
in the prescribed form.
c) Where any process relates to a factory owned or controlled by the Central
Government or to a corporation or accompany owned or controlled by the
Central Government, the State Government shall co-opt in the Site Appraisal
Committee representative nominated by the Central Government as a member
of that Committee.
d) The State Appraisal Committee shall have power to call for any information from
the person making an application for the establishment or expansion of a
factory involving a hazardous process.
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e) Where the State Government has granted approval to an application for the
establishment or expansion of a factory involving a hazardous process, it shall
not be necessary for an applicant to obtain a further approval from the Central
Board or the State Board established under the Water (Prevention and Control
of Pollution) Act, 1974, and Air (Prevention and Pollution) Act, 1981.
2. Completely discount of information by the occupies
a) The occupier of every factory involving a hazardous process shall disclose in the
manner prescribed all information regarding dangers, health hazards and the
measures to overcome them arising from the exposure to or handling of the
materials or substances in the manufacture, transportation, storage and other
process to
i) Workers employed in the factory;
ii) The Chief Inspector;
iii) The local authority, within whose jurisdiction the factory is situated; and
iv) General public in the vicinity.
b) Such information, shall include accurate information as the quantity,
specifications and other characteristics of wastes and manner of their disposal
(Subsection 3).
c) Every occupier, with the approval of the Chief Inspector, shall draw up an on-site
emergency plan and detailed disaster control measures for his factory and make
known to the workers employed therein and to the general public living in the
vicinity of the factory the safety measures required to be taken in the event of an
accident taking place. (Subsection 4).
d) Every occupier of the factory is under an obligation to inform the Chief Inspector
of the nature of details of the process in such form and in such manner as may
be prescribed. (Subsection 5)
e) On contravention of the provisions Subsection (5), the license issued under
Section 6 to such factory shall be cancelled and the occupier shall be liable to
penalty (Subsection 6).
f) The occupier of the factory involving a hazardous process shall, with the previous
approval of the Chief Inspector, lay down measures of handling, usage,
transportation and storage of hazardous substances inside the factory premises
and the disposal of such substances outside the factory premise and publicise
them in the vicinity. (Subsection 7).
3. Specific responsibility of the occupier in relation to hazardous process
Under Section 41C, every occupier of a factory involving any hazardous
process is to required to
a) maintain accurate and up-do-date health records, or a as the case may be,
medical records of the workers in the factory who are exposed to any chemical,
toxic or any other harmful substance which are manufactured, stored, handled
93
or transported, and such records shall be accessible to the workers subject to

prescribed conditions;
b) Appoint persons who possess qualifications and experience in handling
hazardous substances and are competent to supervise such handling within the
factory and to provide at the working place all the necessary facilities for
protecting the workers in the prescribed manner; and
c) Provide for medical worker is assigned to a job involving the handling of, or
working with, a hazardous substance, and
i) Before such worker is assigned to a job involving the handling of, or
working with, a hazardous substance, and
ii) While continuing in such job, and after he has ceased to work in such job,
at intervals not exceeding twelve months, in the prescribed manner.
4. Powers of Central Government to appoint Inquiry Committee
a) The Central Government may, in the event of the occurrence of an
extraordinary situation involving a factory engaged in hazardous process,
appoint an Inquiry Committee to inquire into the standards of health and
safety observed in the factory with a view to find out the causes of any failure
or neglect in the adoption of any measures or standards prescribed for the
health and safety of the workers employed in the factory or the general public
affected, or likely to be a affected, due to such failure or neglect, and the
prevention and the recurrence of such extraordinary situations further in
such factory or elsewhere.
b) The Committee appointed under Subsection (1) shall consist of a Chairman
and two other members and the terms of reference of the Committee and the
tenure of Office of its members shall be such as may be determined by the
Central Government according to the requirements of the situation.
The recommendation of the Committee shall be advisory in nature.
5. Emergency standards
a) Where in Central Government is satisfied that no standards of safety have
been prescribed in respect of a hazardous process or class of hazardous
process, or where the standards so prescribed are inadequate, it may direct
the Director General of factory advice service and labour institutes or any
institution specialized in matters relating to enforcement of suitable standards
in respect of such hazardous process.
b) The emergency standards laid down under Subsection (1) shall, until they are
incorporated in the rules made under this Act, be enforceable and have the
same effect as if they had been incorporated in the rules made under this Act.
6. Workers’ participants is safety management
a) The occupier shall, in every factory, where a hazardous process takes place, or
where hazardous substances are used or handled, set up a Safety Committee
consisting of equal number of representatives of workers and management to
promote cooperation between the workers and management in maintaining
94
proper safety and health at work and to review periodically the measures
taken in that behalf:
Provided that the State Government may, by order in Writing and for reasons
to be recorded, exempt the occupier of any factory or class of factories form
setting up such Committee.
b) The composition of the Safety Committee, the tenure of office of its members
and their rights and duties shall be such as may be prescribed.
7. Right of workers to warm about imminent danger
a) Where the workers employed in any factory engaged in a hazardous process
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, agent, manager or any other person who is incharge or
the factory or the process concerned directly or through their representative in
the Safety Committee and simultaneously bring the same to the notice of the
Inspector.
b) It shall be the duty of such occupier agent, manager or the person incharge of
the factory of process to take immediate remedial action if satisfied about the
existence of such imminent danger and send a report forthwith of the action
taken to the nearest Inspector.
c) If the occupier, agent, manager or the person incharge referred to in
Subsection (2) is not satisfied about the existence of any imminent danger as
apprehended by the worker, he shall, nevertheless, refer the matter forthwith
to the nearest Inspector whose decision on the question of the existence of
such imminent danger shall be final.
Under Factory Act 1948 and the Rules framed there under the employers have
to make sure health provisions such as general cleanliness of work place, disposal
of wastes and effluents, ventilation and Temperature dust and fumes, Artificial
humidification, lighting, drinking water, conservancy arrangements and spittoons.
The provisions of safety under Factories Act 1948 include ensuring sufficient
guldens for fencing of Machinery, work on are near machinery in motion
employment of young persons dangerous machine striking gear & derces for cutting
off power, precaution against dangerous fumes & gases, precaution in case of fire
maintenance of buildings & safety of building & machinery.
1. Explain statutory provisions with Regard to health & provisions under
factories Act.
2. Explain statutory provision relating to safety provisions under Factories Act.
3. Elaborate on the Hazardous process under Factories Act (Amendment) 1987.
14.6 SUMMARY
There are moral, Legal & Economic reasons for the employers to take the
Management of health, & safety seriously. Statutory provisions are one of the
primary tools in safety & maintaining good occupational health of employees.
95

1. Visit any factory establishment near your house. Fund out if all the health
provisions, safety provisions are followed in such factories.
1. John Bratton & Jeffrey Gold “Human Resource Management”
2. R.Chandrasekhar, “The Buck stops Here”
3. Ibid, P.574
4. The Economic Times
5. Charles R.Greer. Op. Cit., P.423
14.9 ASSIGNMENTS
1. Discuss the circumstances under which the Manager may be exempted from
liability under Factories Act 1948.
1. The Economic Times - 1996
2. John Bratton and Jeffrey Gold - Op. Cit., P520
3. Industrial Relations Labour Welfare & Labour Laws By B.Nandhakumar
14.11 LEARNING ACTIVITY
1. Write down the various Sections 2(ii), Section 6, Section 11 to 20, Sec 21 to
28, Section 42 to 49, Sec 51, 54, to 56, 59 and 60, Sec 79 according to
Factories Act.
14.12 KEY WORDS
1. Ventilation
2. Over crowding
3. Creches
4. Occupier
5. Welfare Officer
6. Inspectors
7. Occupier

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LESSON - 15
INDUSTRIAL ACCIDENT, NATURE OF ACCIDENT AND

CAUSES OF ACCIDENT
15.1 INTRODUCTION
The success of any Industry depends on the productivity levels, quality of
product, safety, health & contentment of its workers. A safe & Healthy work
environment preventing accidents would motivate the work force and bring out the
best, increasing productivity safety & health.
15.2 OBJECTIVES
After reading the chapter you will be able to know
 What is industrial accident?
 What are the most common types of industrial accidents?
 Causes of Industrial Accidents
 Causes of Industrial Accidents noted by National commission on Labour.
15.3 CONTENTS
What is Industrial Accident?
Industrial accident refer to any accident that occurs at in industrial site.
Types of Industrial Accidents
Industrial accidents occur due to:
1. Trips, slips and falls
2. Strenuous activity or overexertion, such as lifting heavy objects, which often
results in injuries
3. Being struck by a falling or moving object
4. Stepping on or being caught between an object or several objects
5. Death or injuring resulting from collapse of buildings, walls, earth and rocks
6. Exposure to extreme temperatures, electrical currents, atmospheric
pressures and environments, or harmful substances and radiation
7. Exposure to harmful substances resulting in inhalation or ingestion.
Causes of Industrial Accidents: A Complex Phenomenon
Causes of industrial accidents can be studied under the following two broad
categories:
 Unsafe condition
 Unsafe acts
1. Unsafe conditions: The causes of industrial accidents that pertain to
unsafe conditions may include insufficient workplace lighting, excessive noise,
slippery or unsafe flooring, extreme temperature exposure, inadequate problems,
machine malfunction or failure, and so on.
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2. Unsafe acts: The causes of industrial accidents that involve unsafe acts
may include actions or failures to act which result in injury. This can be a result of
employee negligence, but employers, organizations, and product manufacturers can
also be liable for the causes of industrial accidents.
External and Internal Causes
The causes of industrial accidents can be in the environment around the
workplace or within the work environment.
External causes of industrial accidents may include fires, chemical spills,
toxic gas emissions or radiations. The causes of Industrial accidents in these cases
may include organizational errors, human factors, abnormal operational conditions,
natural forces, software or component failure, and outside interference.
Internal causes of industrial accidents may involve equipment or other work-
related tangibles, harmful materials, toxic chemicals and human error.
The causes of accidents can also broadly divided into the following five groups:
1. Technical causes
These are defective and worn-out machinery, poor maintenance, lack of
precautions like safeguards, fencing of dangerous machines, wrong and bad layout,
rooms crowded with machines, raw materials and waste products, neglect in
housekeeping and working conditions.
2. Personnel causes
These include recruitment, selection and placement in industries, personal
and social factor like carelessness, ignorance, inadequate skill, improper
supervisions, relationship with the supervisor and other colleagues, and family
problems.
3. Psychological causes
Psychological, mental and emotional imbalances are at the root of several
accidents. It is well-known that emotionally disturbed or mentally pre-occupied
persons meet with accident and face fatigue, tiredness, overwork, monotony,
boredom, and lack of self-confidence.
4. Non-observance of safety rules
The predominant cause of accidents is the sheer non-observance of industrial
safety rules.
5. Miscellaneous causes
a) Inability of the workers to grasp the implications of a process
b) Neglect of safety regulations by workers and their reluctance to use safety
equipment
c) Haste on the part of the workers, particularly when they are on incentive
payment schemes.
d) Liberal attitude taken by the ESI doctors in certification of accident injuries.
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COST AND CONSEQUENCES OF INDUSTRIAL ACCIDENT

1. Direct cost of accidents
Accidents have also obvious, direct costs such as medical bills, hospital and
rehabilitation expenses, workers’ compensation payments, and higher insurance
premiums or even loss insurability.
2. Indirect and hidden costs of accidents
Accidents have also less obvious, indirect cost that are usually uninsured.
These include the various disruptions to normal work procedures, such as when
employees stop to help the injured employee or even a drop in production that
cause inconsistencies with delivery.
Indirect costs include
 Time lost from work by injured employee(s);
 Loss in earning power;
 Economic loss to injured workers family;
 Lost time by fellow employees;
 Loss of efficiency due to break-up of crew;
 Time lost in supervision;
 Cost of breaking-in a new worker;
 Damage to tools and equipment;
 Spoiled work;
 Loss of production
 Spoilage due to fire, water, chemicals, explosives, etc;
 Failure to fill orders; and
 Overhead cost (while work was disrupted).
The following are some examples of hidden costs:
 Production loss/worker distraction
 Training costs/replacement of worker
 Loss of skill/efficiency-slowed production
 Paperwork
 Administrative time
 Loss of morale
 Legal issues
 Medical expenses
 Wages
 Equipment
3. Causes of Industrial Accidents Noted by National Commission on Labour
Some of the causes of industrial accidents noted by the National Commission
Labour are as follows:
1. Human failure due to carelessness, ignorance, inadequate skill, and improper
supervision.
2. Repaid industrialization
3. Expansion or modification of existing factories
4. Setting up of new industries involving hazards not known earlier
5. Lack of safety consciousness on the part of both workers and management
6. Inadequate realization of the financial implications of accidents.
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The causes of Accidents are mostly related to Technical & Human Factors.
Safe & Healthy work environment preventing accidents would motivate the work
force and bring out the best.
The total cost of accident is calculated as direct cost of accident plus indirect
& hidden cost of Accident.
Industrial accidents are caused due to unsafe conditions and unsafe acts.
1. What is industrial accident?
2. List out the different types of Industrial accident.
3. List out the examples of hidden costs.
4. List out the unsafe condition that lead to industrial accidents.
15.6 SUMMARY
1. Possibility of accident is common in every sphere of human life. The causes of
Accidents are mostly related the Technical & human factors. Accidents are
inevitabilities, but the severity and frequency of accidents can be controlled to
Large extend. Safety to “no accidents”.
2. The causes of Accidents can be unsafe conditions, unsafe acts. It can also be
in environment around the work place or within the work environment.
1. Surf the Internet. Identify a Industrial Accident that has happened recently in
the country. List out the causes of that industrial accident.
1. John B.Miner and Mary Green Miner “Personnel and Industrial Relations”
Fourth edition.
2. N.G.Nair “Personnel Management & Industrial Relations.
3. Journal of contemporary Research in Management.
15.9 ASSIGNMENTS
1. What is Ice Berg effect in the context of cost of Accident?
2. Discuss the safety measures followed in US Nuclear power plant?
1. A.M. Sharma “Aspects of Labour welfare and Social Security”.
2. L.S. Kudchekar “Aspect of personnel Management and Industrial Relation”.
1. Discuss the problems faced due to expansion or modification of existing
factors in content of Industrial Accident.
15.12 KEY WORDS
1. Industrialization
2. Hazards
3. Supervision
4. Ingestion
5. Compensation

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LESSON - 16
ACCIDENT MEASUREMENT - BASIS OF SAFETY PROGRAMME AND

POLICY - INDUSTRIAL MEDICAL OFFICER
16.1 INTRODUCTION
Industrial accidents can be measured by frequency rate and seventy rate. A
worker can be injured in several ways in the work environment. Safety can be
implemented by enforcement, education and engineering employees, employees and
managers are responsible for industrial safety.
16.2 OBJECTIVES
After reading this chapter you will be able to know
 Measure of Industrial injuries and thereby accident measurement.
 Prevention of Accidents and policies there for.
 Benefits of Accident prevention efforts.
 What is industrial safety training programme.
16.3 CONTENTS
Statistical Measures for Injuries
The important statistical measures for injuries are the
 Frequency rate and
 Severity rate
1. Frequency rate
The frequency rate is calculated by dividing the total number of injuries by the
corresponding number of mandays worked in lakhs.
2. Severity rate
The severity rate, which takes into account the duration of disability was well,
is calculated by dividing the number of mandays lost due to injuries by the number
of mandays worked in lakhs. This rate is calculated only in respect of those non-
fatal injuries in which workers returned to work during the same year and no time
charges have been laid down for the fatal injuries as well as those non-fatal injuries
in which the workers did not return to work during the same year.
Prevention of Accidents
1. Industrial accident prevention, which focuses on the safety of the industrial site
Employers must
a) Inspect the site with safety engineers and warn employees possible danger
zones. Workers, in turn, must comply with the safety requirements set forth
by their supervisors in order to maximize industrial accident prevention
measures and
b) enforce safety rules or take safety precautions on their industrial site, and
they can be held liable in a third-party suit.
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2. Industrial accident prevention, which focuses on the equipment frequently used in

industrial area
Employers must
a) Provide adequate safety precautions to equipment such as scaffolding (many
industrial accidents are caused by falls heights or faulty scaffolds), motorized
vehicles machinery that are frequently used on industrial sites; and
b) Compel the equipment and machinery manufactures to design, produce and
maintain properly functioning products.
3. Industrial accident prevention, which focuses on the employers
Employers must provide employees with
a) A safe place to work;
b) Safe tools to the work with;
c) Knowledge of hazards;
d) Competent fellow employees and supervisors; and
e) Rules to perform the work safely and the means to ensure that the rules are
observed.
4. Industrial accident prevention, which focuses on uncase conditions
a) Easiest to correct (and very cost-effective)
b) Easiest to prevent
i) Safety audits
ii) Safety inspections
iii) Maintenance schedules for equipment
iv) Encouraging employee reporting
v) Good housekeeping.
5. Industrial accident prevention, which focuses on unsafe acts
a) Most difficult to address like changing behaviour is not easy.
b) Industrial accidents are best prevented by developing a ‘safety culture’.
6. Industrial accident prevention, which focuses on supervisors/foremen
Supervisors/foremen should insist on the following accident-prevention measures:
a) Development of safe working conditions.
b) Creation of safe work habits on a personalized basis.
c) Promotion of employee participation in safety.
d) Taking action when safety rules are ignored.
7. Industrial accident prevention measures as suggested by the Tripartite Technical
Conference organized by the International Labour Organization
A Tripartite Technical Conference, organized by the International Labour
Organization 1948, formulated a Model Code of Safety Regulations for Industrial
Establishments for the guidance of governments and industry. Rule 82 of this Code
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deals with guarding of machinery. As per the Code, the guards should be properly
designed, constructed and used so that they will
a) Provide positive protection;
b) Prevent all access to the danger zone;
c) Cause the operator no discomfort or inconvenience;
d) Taking action when safety rules are ignored.
e) Not interfere unnecessarily with production;
f) Operate automatically or with minimum effort;
g) Constitute preferably a built-in feature;
h) Be suitable for the job and the machine;
i) Provide for machine oiling, inspection, adjustment and repair;
j) Withstand long use with minimum maintenance;
k) Resist normal wear and shock;
l) Be durable, and fire and erosion resistance;
m) Not constitute a hazard by themselves; and
n) Protect against unforeseen operational; contingencies.
Benefits of Accident Prevention Efforts
1. Every accident prevented saves direct and indirect accident costs, that is,
money that remains in profits.
2. Employees will not be injured or killed.
3. Property and materials will not be destroyed.
4. Production will flow more smoothly.
5. An employee will have more time for other management duties connected
with his/her job.
6. Increased employee security at work.
Industrial Safety Training Programme
Maintaining a safe and healthy working environment is not only a major
human resources issue, it is also the law. Whether they are entry-level workers,
seasoned veterans, supervisors, or plant managers, employees need to understand
health and safety standards and compliance procedures. Hence, the industrial
safety training programmes are essential and recommended especially to electrical
workers, machine tool operators, laboratory personnel, and anyone handling
hazardous chemicals or materials.
A highly adaptable Industrial Safety Training programme helps employees to
1. Select proper protective clothing to safeguard eyes, ears, skin, and mouth
within the workplace.
2. Demonstrate proper practice to avoid the most common kinds of accidents.
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3. State the correct practice to follow to avoid electric shock when using
electric tools.
4. Demonstrate safe practice when using common types of ladders and
scaffolding.
5. State the key points for the safe use of powered industrial trucks, and for
both gravity and powered conveyers.
6. Describe procedures for the treatment of electric shock.
1. The measure for safety measurement include frequency rate and seventy
rate. The industrial accident prevention focuses on safety of industrial site,
equipment frequently used in Industrial Area, focuses on employers, focus
on unsafe conditions, unsafe Acts & focus on supervisors.
2. A Industrial Safety Training programme includes select, Demonstrate, State,
Demonstrate, State of Describe.
1. Discuss the Benefits of efforts of Accident prevention.
2. Elaborate on the focus of prevention of accidents.
3. What is the measure of accidents?
4. Discuss the Industrial safety training programme.
16.6 SUMMARY
The measure of accident is on frequency rate & seventy rate prevention of
accidents are done by several ways. The basic requirement for industrial safety is
engineering, education and enforcement. The safety Training programme helps
employees select demonstrate, state, demonstrate state and describe.
1. Critically examine the causes of Industrial Accidents.
2. Discuss the common industry safety products.
3. Industrial safety - whose responsibility?
1. John Bratton and Jeffrey Gold, Thiman Resources Management
2. Randall S.Schuler, effective Personnel Management.
3. The Economic Times.
16.9 ASSIGNMENTS
1. In light of safety programme, is there a need for Safety Audit - Discuss.
2. What are the Recommendation on Industrial safety by National commission
on Labour?
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1. Hydro Engineers Pvt., The work man AIR
2. Butler, Aurther.D “Labour Economics & Institutions.
3. Webb. Sydney and Beatrice, Industrial Democracy.
1. What do you look during an safety Audit.
2. What are types of safety audits and where it is conducted?
12. KEY WORDS
1. Accidents
2. Frequency
3. Tripartite
4. Technical

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UNIT - V
LESSON - 17
FACTORIES ACT - LAWS OF WORKING CONDITION

16.1 INTRODUCTION
The Term Industry refers to a steady and systematic Activity in which a Trade
in where such Actuaries are carried on. The Factories Act 1948 was passed with an
Intention of making the word life of persons employed in Factories free from
Hazards and Injuries.
16.2 OBJECTIVES
After Reading this chapter you should be able to
 Understand the statement of object, reasons and definition of Factories Act
Safety &
 Know the health, safety, welfare provisions
16.3 CONTENTS
Statement of Objective and Reasons
The existing law relating to the regulation of labour employed in factories in
India is embodied in the Factories Act, 1934. Experience of the working of the Act
has received a number of defects and weaknesses which hamper effective
administration. Although the Act has been amended in certain respects in a
piecemeal fashion whenever some particular aspect of labour safety or welfare
assumed urgent importance, the general framework has remained unchanged. The
provisions for the safety health and safety, health and welfare of workers are
generally found to be inadequate and unsatisfactory and even such protection as in
provided does not extend to the large and growing industrial activities in the
country, a radical overhauling of the Factories law is essentially called for and
cannot be delayed.
Preliminary
1. Short title, extent end commencement
1) This Act may be called THE FACTORIES ACT, 1948
2) It extends to the whole of India.
3) It shall come into force on the 1st day of April, 1949.
2. Interpretation In this Act, unless there is anything repugnant in the subject or
context,
a) “adult” means a person who has completed his eighteenth year of age;
b) “adolescent” means a person who has completed his fifteenth year of age but
has not completed his eighteenth year;
 “calendar year” means the period of twelve months beginning with the
first day of January in any year;
c) “child” means a person who has not completed his fifteenth year of age;
 “hazardous process” means any process or activity in relation to an
industry specified in the First Schedule where, unless special care is
106
taken, raw materials used therein or the intermediate or finished

products, by-products, wastes or effluents thereof would,
d) “young person” means a person who is either a child or an adolescent;
e) “day” means a period of twenty-four hours beginning at midnight;
f) “week” means a period of seven days beginning at midnight on Saturday
night or such other night as may be approved in writing for a particular
area by the Chief Inspector of Factories;
g) “power” means electrical energy or any other form of energy which is
mechanically transmitted and is not generated by human or animal agency;
h) “prime mover’ means any engine, motor or other appliance which generates
or otherwise provides power;
i) “transmission machinery” means any shaft, 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 by any machinery
or appliance;
j) “machinery” includes prime movers, transmission machinery and all other
appliances whereby power is generated, transformed, transmitted or
applied;
k) “manufacturing process” means any process for,
i. making, altering, repairing, ornamenting, finishing, packing, oiling,
washing, cleaning, breaking up, demolishing, or otherwise treating or
adapting any article or substance with a view to it use, sale, transport,
delivery or disposal, or
ii. pumping oil, water, sewage or any other substance, or
iii. constructing, reconstructing, repairing, refitting, finishing or breaking
up ships or vessels; or
l) “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 or not, in any manufacturing process
or in cleaning any part of the machinery or premises used for a
manufacturing process, or in any other kind of work incidental to, or
connected with, the manufacturing process, or the subject of the
manufacturing process but does not include any member of the armed
forces of the union;
m) “factory” means any premises including the precincts thereof,
i. whereon ten or more workers are working, or were working on any day
of the preceding twelve months, and in any part of which a
manufacturing process is being carried on with the aid of power, or is
ordinarily so carried on, or
ii. whereon twenty or more workers are working, or were working on any
day of the preceding twelve months, and in any part of which a
manufacturing process is being carried on without the aid of power, or is
ordinarily so carried on,
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n) “occupier” of a factory means the person who has ultimate control over the
affairs of the factory. Provided that,
i. in the case of a firm or other association of individuals, any one of the
individual partners or members thereof shall be deemed to be the
occupier;
ii. in the case of a company, any one of the directors shall be deemed to be
the occupier;
iii. in the case of a factory owned or controlled by the Central Government
or any State Government, or any local authority, the person or persons
appointed to manage the affairs of the factory by the Central
Government, the State Government or the local authority, as the case
may be, shall be deemed to be the occupier:
a) the workers employed directly by him, or by or through any agency; and
b) the machinery, plant or premises in use for the purpose of carrying out
such repair or maintenance work by such owner, agent, master or other
officer-in-charge or person;
o) “prescribed” means prescribed by rules made by the State Government
under this Act;
p) where work of the same kind is carried out by two or more sets of workers
working during different periods of the day, each of such sets is called a
“group” or “reply” and each of such periods is called a “shift”.
6. Approval, licensing and registration of factories
1) The State Government may make rules,
a) requiring, for the purposes of this Act, the submission of plans of any
class or description of factories to the Chief Inspector or the State
Government;
 requiring the previous permission in writing of the State Government
or the Chief Inspector to be obtained for the site on which the
factory is to be situated and for the construction or extension of any
factory or class or description of factories;
b) requiring for the purpose of considering applications for such
permission the submission of plans and specifications;
c) prescribing the nature of such plans and specifications and by whom
they shall be certified;
d) requiring the registration and licensing of factories or any class or
description of factories, and prescribing the fees payable for such
registration and licensing and for the renewal of licenses;
e) requiring that no license shall be granted or renewal unless the notice
specified in section 7 has been given
2) If on an application for permission referred to in clause (aa) of sub-section
(1) accompanied by the plans and specifications required by the rules made
under clause (b) of that sub-section, sent to the State Government or Chief
108
Inspector by registered post, no order is communicated to the applicant

within three months from the date on which it is so sent, the permission
applied for in the said application shall be deemed to have been granted.
3) Where a State Government or a Chief Inspector refuses to grant permission
to the site, construction or extension of a factory or to the registration and
licensing of a factory, the applicant may within thirty days of the date such
refusal appeal to the Central Government if the decision appealed from was
of the State Government and to the State Government in any other case.
7. Notice by occupier
1. The occupier shall, at least fifteen days before he begins to occupy or use
any premises as a factory, send to the Chief Inspector a written notice
containing,
a) the name and situation of the factory;
b) the name and address of the occupier;
 the name and address of the owner of the premises or building
(including the precincts thereof) referred to in section 93;
c) the address to which communications relating to the factory may be
sent;
d) the nature of the manufacturing process.
i. carried on in the factory during the last twelve months in the case
of factories in existence on the date of the commencement of this
Act; and
ii. to be carried on in the factory during the next twelve months in
the case of all factories;
e) the total rated horse power installed or to be installed in the factory,
which shall not included the rated horse power of any separate stand-by
plant;
f) the name of the manager of the factory form the purposes of this Act;
g) the number of workers likely to be employed in factory;
h) the average number of workers per day employed during the last twelve
months in the case of a factory in existence on the date of the
commencement of this Act;
i) such other particulars as may be prescribed.
2. In respect of all establishments which come within the scope of the Act for
the first time, the occupier shall send a written notice to the Chief Inspector
containing the particulars specified in sub-section (1) within thirty days,
from the date of the commencement of this Act.
3. Before a factory engaged in a manufacturing process which is ordinarily
carried on for less than one hundred and eighty working days in the year
resumes working, the occupier shall send a written notice to the Chief
Inspector containing the particulars specified in sub-section (1) at least
thirty days before the date of the commencement of work.
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4. Whenever a new manager is appointed, the occupier shall send to the

Inspector a written notice and to the Chief Inspector a copy thereof within
seven days from the date on which such person takes over charge.
5. During any period for which no person has been designated as manager of a
factory or during which the person designated does not manage the factory,
any person found acting as manager, or if no such person is found, the
occupier himself, shall be deemed to be the manager of the factory for the
purposes of this Act.
a. General duties of the occupier
1. Every occupier shall ensure, so far as is reasonably practicable, the health,
safety and welfare of all workers while they are at work in the factory.
2. Without prejudice to the generality of the provisions of sub-section (1), the
matters to which such duty extends, shall include,
a) the provision and maintenance of plant and systems of work in the factory
that are safe and without risks to health;
b) the arrangements in the factory for ensuring safety and absence of risks to
health in connection with the use, handling, storage and transport of articles
and substance
c) the provision of such information, instruction, training and supervision as
are necessary to ensure the health and safety of all works at work;
d) the maintenance of all places of work in the factory in a condition that is
safe and without risks to health and the provision and maintenance of such
means of access to, and egress from, such places as are safe and without
such risks;
e) the provision, maintenance or monitoring of such working environment in
the factory for the workers that is safe, without risks to health and adequate
as regards facilities and arrangements for their welfare at work.
3. Except in such cases as may be prescribed, every occupier shall prepare, and, as
often as may be appropriate, revise, a written statement of his general policy
with respect to the health and safety of the workers at work and the
organization and arrangements for the time being in force for carrying out that
policy, and to bring the statement and any revision thereof to the notice of all
workers in such manner as may be prescribed.
1.1 Cleanliness
1) Every Factory shall be kept clean and free from effluvia arising from any drain,
privy or other nuisance, and in particular,
a) accumulations of dirt and refuse shall be removed daily by sweeping or by
any other effective method from the floors and benches of workrooms and
from staircases and passages, and disposed of in a suitable manner;
b) the floor of every workroom shall be cleaned at least once in every week by
washing, using disinfectant, where necessary, or by some other effective
method;
110
c) where a floor is liable to become wet in the course of any manufacturing

process to such extent as is capable of being drained, effective means of
drainage shall be provided as maintained;
d) all inside walls and partitions, all ceilings or tops of rooms and all walls, side
and tops of passages and staircases shall-
i. where they are painted otherwise than with washable water-paint or
varnished, be re-painted or re-varnished at least once in every period of
five years;
 where they are painted with washable water-paint, be re-painted with
at least one coat of such paint at least once in every period of three
years and washed at least once every period of six months;
ii. where they are painted or varnished or where they have smooth
impervious surfaces, be cleaned at least once in every period of fourteen
months by such method as may be prescribed;
iii. in any other case, be kept whitewashed, or colour washed, and the
whitewashing or colour washing shall be carried out at least once in
every period of fourteen months;
 all doors and window frames and others wooden or metallic
framework and shutters shall be kept pained or varnished and the
painting or varnishing shall be carried out at least once in every
period of five years;
1.2 Disposal of wastes and effluents
1. Effective arrangements shall be made in every factory for the treatment of
wastes and effluents due to the manufacturing process period on therein, so
as to render them innocuous, and for their disposal.
2. The State Government may make rules prescribing the arrangements to be
made under sub-section (1) or requiring that the arrangements made in
accordance with sub-section (1) shall be approved by such authority as may
be prescribed.
1.3 Ventilation and temperature
1) Effective and suitable provision shall be made in every factory for securing and
maintaining in every workroom,
a) adequate ventilation by the circulation of fresh air, and
b) such a temperature as will secure to workers therein reasonable conditions
of comfort and prevent injury to healthy; and in particular,
i. walls and roofs shall be of such material and so designed that such
temperature shall not be exceeded but kept as low as practicable;
ii. where the nature of the work carried on in the factory involves, or is
likely to involve the production of excessively high temperatures, such
adequate measures as are
2. The State Government may prescribe a standard of adequate ventilation
and reasonable temperature of any factory or class or description of factories
111
or parts thereof and direct that proper measuring instruments, at such

places and in such position as may be specified, shall be provided and such
records, as may be prescribed, shall be maintained.
1. If it appears to the Chief Inspector that excessively high temperatures in
any factory can be reduced by the adoption of suitable measures, he
may, without prejudice to the rules made under sub-section (2), serve on
the occupier, an order in writing specifying the measures which, in his
opinion, should be adopted, and requiring them to be carried out before
a specified date.
1.4 Dust and fume
1. In every factory in which, by reason of the manufacturing process carried on,
there is given off any dust or fume or other impurity of such a nature and to
such an extent as is likely to be injurious or offensive to the workers employed
therein, or any dust in substantial quantities, effective measures shall be taken
to prevent its inhalation and accumulation in any workroom, and if any
exhaust appliance is necessary for this purpose, it shall be applied as near as
possible to the point of origin of the dust, fume or other impurity, and such
point shall be enclosed so far as possible.
2. In any factory no satisfactory internal combustion engine shall be operated
unless the exhaust is conducted into the open air, and no other internal
combustion engine shall be operated in any room unless effective measures
have been taken to prevent such accumulation of fumes there from as re likely
to be injurious to workers employed in the room.
1.5 Artificial humidification
1. In respect of all factories in which the humidity of the air is artificially
increased, the State Government may make rules,
a) Prescribing standard of humidification;
b) regulating the methods used for artificially increasing the humidity of the
air;
c) directing prescribed tests for determining the humidity of the air to be
correctly carried out and recorded;
d) prescribing methods to be adopted for securing adequate ventilation and
cooling of the air in the workrooms.
2. In any factory in which the humidity of the air is artificially increased, the
water used for the purpose shall be taken from a public supply, or other source
of drinking water, or shall be effectively purified before it is so used.
3. If it appears to an Inspector that the water used in a factory for increasing
humidity which is required to be effectively purified under sub-section (2) is not
effectively purified he may serve on the manager of the factory an order in
writing, specifying the measures which in his opinion should be adopted, and
requiring them to be carried out before specified date.
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1.6 Overcrowding
1. No room in any factory shall be overcrowded to an extent injurious to the
health of the workers employed therein.
2. Without prejudice to the generality of sub-section (1), there shall be in every
workroom of a factory in existence on the date of the commencement of this Act
at least 9.9 cubic meters and of a factory built after the commencement of this
Act at least 1.2 cubic meters of space for every worker employed therein, and
for the purposes of this sub-section no account shall be taken of any space
which is more than 4.2 meters above the level of the floor of the room.
3. If the Chief Inspector by order in writing so requires there shall be posted in
each workroom of a factory a notice specifying the maximum number of
workers who may, in compliance with the provisions of this section, be
employed in the room.
4. The Chief Inspector may be order in writing so requires, there shall be posted
in each workroom of a factory a notice specifying the maximum number of
workers who may, in compliance with the provisions of this section, be
employed in the room.
1.7 Lighting
1. In every part of factory where workers are working or passing there shall be
provided and maintained sufficient and suitable lighting, natural or artificial or
both.
2. In every factory all glazed windows and skylights used for the lighting of the
workroom shall be kept clean on both the inner and outer surfaces and, so far
as compliance with the provisions of any rules made under sub-section (3)
section 13 will allow, free from obstruction.
3. In every factory effective provision shall, so far as is practicable, be made for
the prevention of,
a) glare, either directly from a source of light or by reflection from a smooth
or polished surface;
1.8 Drinking water
1) In every factory effective arrangements shall be made to provide and maintain
at suitable points conveniently situated for all workers employed therein a
sufficient supply of wholesome drinking water.
2) All such points shall be legibly marked “drinking water” in a language
understood by a majority of the workers employed in the factory, and no such
point shall be situated within six meters of any washing place, urinal latrine,
spittoon, open drain carrying sullage or effluent or any other source of
contamination unless a shorter distance is approved in writing by the Chief
Inspector.
3) In every factory wherein more than two hundred and fifty workers are
ordinarily employed, provision shall be made for cooling drinking water during
hot weather by effective means and for distribution thereof.
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4) In respect of all factories or any class or description of factories the State

Government may make rules for securing compliance with the provisions of
sub-sections (1),(2) and (3) and for the examination by prescribed authorities of
the supply distribution of drinking water in factories.
1.9 Latrines and urinals
1) In every factory,
a) sufficient latrine and urinal accommodation of prescribed types shall be
provided conveniently situated and accessible to workers at all times
while they are at the factory;
b) separate enclosed accommodation shall be provided for male and female
workers;
c) such accommodation shall be adequately lighted and ventilated, and no
latrine or urinal shall, unless specially exempted in writing by the Chief
Inspector, communicate with any workroom except through an
intervening open space or ventilated passage;
d) all such accommodation shall be maintained in a clean and sanitary
condition at all times;
e) sweepers shall be employed whose primary duty it would be to keep
clean latrines, urinals and washing places.
2) In every factory wherein more than two hundred and fifty workers are
ordinarily employed,
a) all latrine and urinal accommodation shall be of prescribed sanitary
types;
b) the floors and internal walls, up to a height of ninety centimeters, of the
latrines and urinals and the sanitary blocks shall be laid in glazed tiles
or otherwise finished to provide a smooth polished impervious surface;
3) The State Government may prescribe the number of latrines and urinals to be
provided in any factory in proportion to the numbers of male and female
workers ordinarily employed therein, and provide for such further matters in
respect of sanitation in factories, including the obligation of workers in this
regard, as it considers necessary in the interest of the health of the workers
employed therein.
1.10 Spittoons
1) In every factory there shall be provided a sufficient number of spittoons in
convenient places and they shall be maintained in a clean and hygienic
condition.
2) The State Government may make rules prescribing the type and the number of
spittoons to be provided and their location in any factory and provided for such
further matters relating to their maintenance in a clean and hygienic condition.
3) No person shall spit within the premises of a factory except in the spittoons
provided for the purpose and a notice containing this provision and the penalty
for its violation shall be prominently displayed at suitable places in the
premises.
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4) Whoever spits in contravention of sub-section (3) shall be punishable with

fine not exceeding five rupees.
Safety
1.11. Fencing of machinery
1) In every factory the following, namely
i. every moving part of a prime mover and every fly wheel connected to
prime mover, whether the prime mover or flywheel is in the engine house
or not;
ii. the headrace and tailrace of every water-wheel and water turbine;
iii. any part of a stock-bar which projects beyond the head stock of lathe;
and
iv. unless they are in such position or of such construction as to be safe to
every person employed in the factory as they would be if they were
securely fenced, the following, namely,
a) every part of an electric generator, a motor or rotary convertor;
b) every part of transmission machinery; and
c) every dangerous part of any other machinery, shall be securely fenced
by safeguards of substantial construction which shall be constantly
maintained and kept in position while the parts of machinery they are
fencing are in motion or in use:
1.12 Work on or near machinery in motion
1) Where in any factory it becomes necessary to examine any part of machinery
referred to in section 21, while the machinery is in motion, or, as result of
such examination, to carry out, while the machinery is in motion, such
examination or operation shall be made or carried out only by a specially
trained adult male worker wearing tight fitting clothing (which shall be
supplied by the occupier) whose name has been recorded in the register
prescribed in this behalf and who has been furnished with a certificate of his
appointment, and while he is so engaged,
a) such worker shall not handle a belt at a moving pulley unless,
i. the belt is not more than fifteen centimeters in width;
ii. the pulley is normally for the purpose of drive and not merely a fly-wheel
or balance wheel (in which case a belt is not permissible);
iii. the belt joint is either laced or flush with the belt;
iv. the belt, including the joint and the pulley rim, are in good repair;
v. there is reasonable clearance between the pulley and any fixed plant or
structure;
vi. secure foothold and, where necessary, secure handhold, are provided for
the operator; and
vii. any ladder in use for carrying out any examination or operation aforesaid
is securely fixed or lashed or is firmly held by a second person;
2) No woman or young person shall be allowed to clean, lubricate or adjust any
part of a prime mover of any transmission machinery while the prime over or
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transmission machinery is in motion, or to clean, lubricate or adjust any

part of any machine if the cleaning, lubrication or adjustment thereof would
expose the woman or young person to risk of injury from any moving part
either of that machine or of any adjacent machinery.
1.13 Employment of young persons on dangerous machines
1) No young person shall be required or allowed to work at any machine to
which this section applies, unless he has been fully instructed as to the
dangers arising in connection with the machine and the precautions to be
observed and -
a) has received sufficient training in work at the machine, or
b) is under adequate supervision by a person who has a thorough
knowledge and experience of the machine.
2) Sub-section (1) shall apply to such machines as may be prescribed by the
State Government, being machines which in its opinion are of such a
dangerous character that young persons ought not to work at them unless
the foregoing requirements are complied with.
1.14 Prohibition of employment of women and children near cotton-opener
No woman or child shall be employed in any part of a factory for pressing
cotton in which a cotton-opener is at work:
Provided that if the feed-end of a cotton-opener is in a room separated from the
delivery end by a partition extending to the roof or to such height as the Inspector
may in any particular case specify in writing, women and children may be employed
on the side of the partition where the feed-end is situated.
1.15 Lifting machines, chains, ropes and lifting tackles
1) In any factory the following provisions shall be complied with in respect of
every lifting machine (other than a hoist and lift) and every chain, rope and,
lifting tackle for the purpose of raising or lowering persons, goods or
materials,
a) all parts, including the working gear, whether fixed or movable, of every
lifting machine and every chain, rope or lifting tackle shall be,
i. of good construction, sound material and adequate strength and free
from defects;
ii. properly maintained; and
iii. thoroughly examined by a competent person at least once in every
period of twelve months, or at such intervals as the Chief Inspector
may specify in writing; and a register shall be kept containing the
prescribed particulars of every such examination;
b) no lifting machine and no chain, rope or lifting tackle shall, except for
the purpose of test, be loaded beyond the safe working load which shall
be plainly marked thereon together with an identification mark and duly
entered in the prescribed register; and where this is not practicable, a
table showing the safe working loads of every kind and size of lifting
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machine or chain, rope or lifting tackle in use shall be displayed in

prominent positions on the premises.
c) while any person is employed or working on or near the wheel track of a
travelling crane in any place where he would be liable to be struck by the
crane, effective measures shall be taken to ensure that the crane does
not approach within six meters of that place.
1.16 Revolving machinery
1) In every factory in which the process of grinding is carried on there shall be
permanently affixed to or placed near each machine in use a notice indicating
the maximum safe working peripheral speed of every grindstone or abrasive
wheel, the speed of the shaft or spindle upon which the wheel is mounted, and
the diameter of the pulley upon such shaft or spindle necessary to secure
such safe working peripheral speed.
2) The speeds indicated in notice under sub-section (1) shall not be exceeded.
3) Effective measures shall be taken in every factory to ensure that the safe
working peripheral speed of every resolving vessel, cage, basket, fly-wheel,
pulley, disc or similar appliance driven by power is not exceeded.
1.17 Pressure plant
1) If in any factory, any plant or machinery or any part thereof is operated at a
pressure above atmospheric pressure, effective measures shall be taken to
ensure that the safe working pressure of such plant or machinery or part is
not exceeded.
2) The State Government may make rules providing for the examination and
testing of any plant or machinery such as referred to in sub-section (1) and
prescribing such other safety measures in relation thereto as may in its
opinion be necessary in any factory or class or description of factories.
3) The State Government may, by rules, exempt, subject to such conditions as
may be specified therein, any of any plant or machinery referred to in sub-
section (1) from the provisions of this section.
1.18 Pits, sumps, openings in floors, etc
1) In every factory every fixed vessel, sump, tank, pit or opening in the ground or
in a floor which, by reason of its depth, situation, construction, or contents, is
or may be a source of danger, shall be either securely covered or secure
fenced.
2) The State Government may, by order in writing, exempt, subject to such
conditions as may be prescribed, any factory or class or description of
factories in respect of any vessel, sump, tank, pit or opening from compliance
with the provisions of this section.
1.19 Excessive weights
1. No person shall be employed in any factory to lift, carry or move any load so
heavy as to be likely to cause him injury.
2. The State Government may make rules prescribing the maximum weights
which may be lifted, carried or moved by adult men, adult women, adolescents
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and children employed in factories or in any class or description of factories or

in any class or description of factories or in carrying on any specified process.
1.20 Protection of eyes
In respect of any such manufacturing process carried on in any factory as may
be prescribed, being a process which involves,
a) risk of injury to the eyes from particles of fragments thrown off in the course
of the process, or
b) risk to the eyes by reason of exposure to excessive light, the State
Government may by rules require that effective screens or suitable goggles
shall be provided for the protection of persons employed on, or in the
immediate vicinity of, the process.
1.21. Explosive or inflammable dust, gas, etc
1) Where in any factory any manufacturing process produces dust, gas, fume
or vapour of such character and to such extent as to be likely to explode to
lignition, all practicable measures shall be taken to prevent any such
explosion by
a) effective enclosure of the plant or machinery used in the process;
b) removal or prevention of the accumulation of such dust, gas, fume or
vapour;
c) exclusion or effective enclosure of all possible sources of ignition.
2) Where in any factory he plant or machinery used in a process such as is
referred to in sub-section (1) is not so constructed as to withstand the
probable pressure which such an explosion as aforesaid would produce, all
practicable measures shall be taken to restrict the spread and effects of the
explosion by the provision in the plant or machinery of chokes, baffles, vents
or other effective appliances.
1.22 Precaution in case of fire
1) In every factory, all practicable measures shall be taken to prevent outbreak
of fire and its spread, both internally and externally, and to provide and
maintain,
a) safe means of escape for all persons in the event of a fire, and
b) the necessary equipment and facilities for extinguishing fire
2) Effective measures shall be taken to ensure that in every factory all the
workers are familiar with the means of escape in case of fire and have been
adequately trained in the routing to be followed in such cases.
3) The State Government may make rules, in respect of any factory or class or
description of factories, requiring the measures to be adopted to give effect to
the provisions of sub-sections (1) and (2).
1.23 Safety to buildings and machinery
1) If its appears to the Inspector that any building or part of a building or any
part of the ways, machinery or plant in factory is in such condition that it is
dangerous to human life or safety, he may serve on the occupier or manager
or both of the factory an order in writing specifying the measures which in
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his opinion should be adopted, and requiring them to be carried out before
a specified date.
2) If it appears to the Inspector that the use of any building or part of a
building or any part of the ways, machinery or plant in a factory involves
imminent danger to human life or safety, he may serve on the occupier or
manager or both of the factory an order in writing prohibiting its use until it
has been properly repaired or altered.
a) Maintenance of buildings
If it appears to the Inspector that any building or part of a building in a factory
is in such a state of disrepair as is likely to lead to conditions detrimental to the
health and welfare of the workers, he may serve on the occupier or manager or both
of the factory an order in writing specifying the measures which in his opinion
should be taken and requiring the same to be carried out before such date as is
specified in the order.
b) Safety officers
i. wherein one thousand or more workers are ordinarily employed, or
ii. wherein, in the opinion of the State Government, any manufacturing
process or operation is carried on, which process or operation involves any
risk of bodily injury, poisoning or disease, or any other hazard to health, to
the persons employed in the factory, the occupier shall, if so required by the
State Government by notification in the Official Gazette, employee such
number of Safety Officers as may be specified in the notification.
2) The duties, qualifications and conditions of service of Safety Officer shall be
such as may be prescribed by the State Government.
WELFARE
1.24 Washing facilities
a) adequate and suitable facilities for washing shall be provided and
maintained for the use of the workers therein;
b) separate and adequately screened facilities shall be provided for the use
of male and female workers;
c) such facilities shall be conveniently accessible and shall be kept clean.
2) The State Government may, in respect of any factory or class or description of
factories or of any manufacturing process, prescribe standards of adequate and
suitable facilities for washing.
1.25 Facilities for storing and drying clothing
The State Government may, in respect of any factory or class or description of
factories, make rules requiring the provision therein of suitable places for keeping
clothing not worn during working hours and for the drying of wet clothing.
1.26 Facilities for sitting
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1) In every factory suitable arrangements for sitting shall be provided and

maintained for all workers obliged to work in a standing position, in order
that they may take advantage of any opportunities for rest which may occur
in the course of their work.
2) If, in the opinion of Chief Inspector, the workers in any factory engaged in a
particular manufacturing process or working in a particular room are able
to do their work efficiently in a sitting position, he may, by order in writing,
require the occupier of the factory to provide before a specified date such
seating arrangements as may be practicable for all workers so engaged or
working.
3) The State Government may, by notification in the Official Gazette, declare
that the provisions of sub-section (1) shall not apply to any specified factory
or class or description of factories or to any specified manufacturing
process.
1.27 First-aid appliances
1) There shall in every factory be provided and maintained, so as to be readily
accessible during all working hours first-aid boxes or cupboards equipped
with the prescribed contents, and the number of such boxes or cupboards to
be provided and maintained shall not be less than one for every one hundred
and fifty workers ordinarily employed at any one time in the factory.
2) Nothing except the prescribed contents shall be kept in a first-aid box or
cupboard.
3) Each first-aid box or cupboard shall be kept in the charge of a separate
responsible person who holds a certificate in first-aid treatment recognized
by the State Government and who shall always be readily available during
the working hours of the factory.
4) In every factory wherein more than five hundred workers are ordinarily
employed, there shall be provided and maintained an ambulance room of the
prescribed size, containing the prescribed equipment and in the charge of
such medical and nursing staff as may be prescribed and those facilities
shall always be made readily available during the working hours of the
factory.
1.28 Canteens
1) The State Government may make rules requiring that in any specified
factory wherein more than two hundred and fifty workers are ordinarily
employed, a canteen or canteens shall be provided and maintained by the
occupier for the use of the workers.
2) Without prejudice to the generality of the foregoing power, such rules may
provide for,
a) the date by which such canteen shall be provided;
b) the standards in respect of construction, accommodation, furniture and
other equipment of the canteen;
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c) the foodstuffs to be served therein and the charges which may be made
therefore;
d) the constitution of a managing committee for the canteen and
representation of the workers in the management of the canteen;
1.29 Shelters, rest rooms and lunch rooms
1) In every factory wherein more than one hundred and fifty workers are
ordinarily employed, adequate and suitable shelters or rest rooms and a
suitable lunch room, with provision for drinking water, where workers can
eat meals brought by them, shall be provided and maintained for the use of
workers;
Provided further that where a lunch room exists no worker shall eat any food
in the work room.
2) The shelters or rest rooms or lunch rooms to be provided under sub-section
(1) shall be sufficiently lighted and ventilated and shall be maintained in cool
and clean condition.
3) The State Government may,
a) prescribe the standards in respect of construction, accommodation,
furniture and other equipment of shelters, rest rooms and lunch rooms
to be provided under this section;
b) by notification in the Official Gazette, exempt any factory or class or
description of factories from the requirements of this section.
1.30 Creches
1) In every factory wherein more than thirty women workers are ordinarily
employed there shall be provided and maintained a suitable room or rooms
for the use of children under the age of six years of such women.
2) Such rooms shall provide adequate accommodation, shall be adequately
lighted and ventilated, shall be maintained in a clean and sanitary condition
and shall be under the charge of women trained in the care of children and
infants.
3) The State Government may make rules,
a) prescribing the location and the standards in respect of construction,
accommodation, furniture and other equipment of rooms to be provided
under this section;
b) requiring the provision in factories to which this section applies of
additional facilities for the care of children belonging to women workers,
including suitable provision of facilities for washing and changing their
clothing;
c) requiring the provision in any factory of free milk or refreshment or both
for such children;
d) requiring that facilities shall be given in any factory for the mothers of
such children to feed them at the necessary intervals.
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1.31 Welfare officers

1) In every factory wherein five hundred or more workers are ordinarily
employed occupier shall employ in the factory such number of welfare
officers as may be prescribed.
This Act extents to whole of India, it come into force on 1st April 1949. This Act
includes Health provision containing cleanliness, disposal of waste and effluents,
ventilation and temperature, dust and fume, artificial humidification, overcrowding,
lighting, drinking water, latrines and urinal, and spittoons. The safety provisions
include fencing of machinery; work on near machinery in motion, employment of
young person’s on dangerous machines, prohibition of employment of women and
children near cotton-openers, lift machines, revolving machinery, and pressure
plant. The welfare facilities include washing, first aid appliances, canteens, crèches,
welfare officers.
1. Define the term factory, occupier, adult, adolescent, young person, worker
and manufacturing process as used in the Factories Act, 1948.
2. Write a note on provisions relating to welfare facilities introduces by
Factories Act.
16.6 SUMMARY
As the employer prepares the environment, the law seeks to regulate the same
in the interests of the workman. The law provides for security of the place and
approval and plans and specifications before they are registered under the Act for
the purpose of ensuring health, safety and welfare of workers labour reforms in
India, in the context of globalization is much desired but also feared and ........
interpreted. This issue has been a sensitive one ever since the liberalization era
began under the Narasima Rao Govt. in early 1990.
1. Discuss the circumstances under which the occupier or the manager may be
exempted from hobbies under Factories Act, 1948.
2. Discuss the safety measures provided for in the Factories Act, 1948 relating
to dangerous machine.
3. State the provisions in Factories Act, 1948 regarding annual leave with
wages.
1. Industrial relations, labour welfare and labour laws by B.Nandakumar
2. R.Chandrasekhar “The Bucks stops here, Macmillan.
3. Charles R.Greer OP. Cit.,
16.9. ASSIGNMENTS
1. Discuss provisions of Factories Act 1948 in India and in UK with special
reference to weekly holidays.
2. Factories Act 1948 does hold good in post era? Why / Why not.
122

1. John Brattion & Jeffery Gold, Human Resources Management, Palgrove
Macmillan 2003.
2. Ibid P.574.
3. The Economic Times April 9, 1996.
4. Charles R.Greer OP. Cit., P.423.
1. Discuss the Rules regarding approval, licensing & registration of factory.
2. Discuss the procedure of appointment of inspectors under Factories Act ,
1948.
16.12. KEY WORDS
1. Approval
2. Factory
3. Overtime
4. Licensing
5. Worker
6. Safety Officer

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LESSON - 18
SHOPS AND ESTABLISHMENT ACT - MINES ACT

18.1 INTRODUCTION
The shops and Establishment Act, 1947 come into force in the following areas
city of Madras. It extends to whole of state of Tamil Nadu. ‘shop’ means any
premises when any Trade or business is carried on or where services are rendered
to customers. This act includes opening and closing hours of shop, daily & weekly
hours of work in shops.
18.2 OBJECTIVES
After reading this chapter you will become familiar with
 Definitions, references to Time of Day & Exemption.
 Establishing’s other than shops for applicability of this Act.
 Employment of children and young person.
 Health & Safety provisions under shops and establishments Act.
 Statutory provisions relating to Health & Safety under Mines Act, 1952.
18.3 CONTENTS
The Tamil Nadu shops and Establishments Act, 1947
(Act XXXVI of 1947)
An act to provide for the regulation of conditions of work in shops, commercial
establishments, restaurants, theatres and other establishments, and for certain
other purposes.
Whereas it is expedient to provide for the regulation of conditions of work in
shops, commercial establishments and for certain other purposes; it is hereby
enacted as follows:
Short title, extent and commencement
1. This Act may be called the Tamil Nadu Shops and Establishments Act, 1947
2. It extends to the whole of the State of Tamil Nadu.
a) It shall come into force in the following areas on such date as the State
Government may, by notification, appoint: (i) the City of Madras, (ii) all
the municipalities constituted under the Madras District Municipalities
Act, 1920 (Madras Act V of 1920), and iii) All the areas within in the
jurisdiction of panchayts which, under rule 2 of schedule III to the
Madras Village Panchayats Act, 1950 (Madras Act X of 1950), should be
deemed to constituted under that act, and which immediately before the
commencement of that Act, were classified by this government as major
pancahyats and all areas within the jurisdiction of panchayats
constituted under the act which, for the time being, are classified by the
state government as Class I panchayats under section 5 (1) (a) of this
Act.
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b) The (state) Government may, by notification, direct that all or any of this
provision of this Act shall come in to force in any other area on such date
as may be specified in such notification.
Definitions
In this Act, unless there is anything repugnant in the subject or context-
1. ‘child’ means a person who has not completed fourteen years.
2. ‘closed’ means not open for the service of any customer or open to any
business connected with the establishment.
3. ‘commercial establishment’ means an establishment which is not a shop but
which carries on the business of advertising, commission, forwarding or
commercial agency, or which is clerical department of factory or industrial
undertaking or which is an insurance company, joint stock company, bank,
broker’s office or exchange and includes such other establishments as the
state government by notification may by notification declare to be a
commercial establishment for the purposes of this Act.
4. ‘day’ means the period of twenty-four hours beginning at midnight. Provided
that in the case of a person employed, whose hours extend beyond midnight,
day means the period of twenty-fours beginning from the acting in the time
when such employment commences.
5. ‘employer’ means a person owning or having charge of the business of an
establishment and includes the manager, agent or other persons acting in the
general management or control of an establishment;
6. ‘establishment’ means a shop. Commercial establishment, restaurant, eating
house, theatre or any place of public amusement or entrainment and includes
such establishment as the State Government for the purposes of this Act;
7. ‘factory’ means any premises which is a factory within the meaning of the
Factories Act, 1948.
8. ‘inspector’ means an Inspector appointed under section 42;
9. ‘notification’ means a notification in the Fort St. George Gazette;
10. ‘opened’ means opened for the service of any customer.
11. ‘periods of work’ means the time during which a person employed is at the
disposal of the employer;
12. ‘person employed’ means
i) In the case of a shop, a person wholly or principally employed therein in
connection with the business of the shop;
ii) In the case of a factory or an industrial under taking, a member of the
clerical staff employed in such a factory or undertaking;
iii) In the case of a commercial establishment other than a clerical
department of a factory or an industrial undertaking, a person wholly or
principally employed in connection with the business establishment,
and includes a peon;
iv) In the case of a restaurant or eating house, a person who wholly or
principally employed in the preparation or the serving food or drink or
125
in attendance on customers or in cleaning utensils used in the premises

or as a clerk or cashier;
v) In the case of a theater a person employed as on operator, clerk, door-
keeper, usher or in such capacity as may be specified by the
Government by general or special order;
vi) In the case of an establishment under paragraphs (i) to (v) above, a
person wholly or principally employed in connection with the business
of the establishment and includes a peon;
vii) In the case of all establishments, a person wholly or principally
employed n cleaning any part of the premises;
13. ‘prescribed’ means prescribed by the rules made under this Act;
14. ‘residential hotel’ means any premises in which business is carried on bona
fide for the supply of dwelling accommodation and meals on payment of a
sum of money to a traveler or any member of the public or class of the
public
15. ‘restaurant’ or ‘eating house’ means any premises in which is carried on
wholly or principally the business of the supply of refreshments or meals to
the public or a class of the public for consumption on the premises but does
not include a restaurant attached to a theatre.
16. ‘shop’ means any premises where any trade or business is carried on or
where services are rendered to customers and includes offices, store rooms,
godowns and warehouses, whether in the same premises or otherwise, used
in connection with such business but does not include a restaurant or
commercial establishments.
17. ‘theatre’ includes any place intended wholly or principally for the
representation of moving pictures or for dramatic performances.
18. ‘wage’ means any remuneration, capable of being expressed in terms of
money, which would if the terms of the contract of employment, express or
imply, were fulfilled, be payable, whether conditionally upon the regular.
Attendance, good work or conduct or other behavior of the person employed,
or otherwise, to a person employed in respect of his employment or of work
done in such employment, and includes any bonus or other additional
remuneration of the nature aforesaid which would be so payable to such
person by reason of the termination of this employment, but does not
include-
a) The value of any house - accommodation, supply of light, water. Medical
attendance or other amenity or of any service excluded by general or
special order of the (State) Government; b)Any contribution paid by the
employer to any pension fund or provident fund; c) Any traveling
allowance or the value of any traveling concession; d) Any sum paid to
the person employed to defray special expenses entailed on him by the
nature of his employment; or e) Any gratuity payable on discharge;
19. ‘week’ means a period of seven days beginning at midnight on Saturday;
126
20. ‘Young person’ means a person who is not a child and has not completed
seventeen years
References to time of day
Reference to time of day in this act are references to India Standard time
which is five and a half hours ahead of Greenwich mean time.
Exemption
1. Nothing contained in this act shall apply to-
a) persons employed in any establishment in a position of management
b) persons whose work involves traveling: and persons employed as canvasser
send caretakers
c) Establishments under the central and (State) Government, local authorities,
the Reserve Bank of India, and cantonment authorities
d) Establishments in mines and oil fields
e) Establishments in bazaars in places where fairs or festivals are held
temporarily for a period not exceeding fifteen days at a time.
f) Establishments which, not being factories within the meaning of the
Factories Act, 1948 are in respect of matters dealt e/within this Act,
governed by a separate law for the time being in force in the (State), (2)
Nothing contained in section 7 or section 13, as the case may be, shall apply
to- a) hospitals and other institutions for the treatment or care of the sick,
the in firm, the destitute or the mentally unfit; b) Such chemists or druggists
shops as the (State) government may, by general or special order, specify
Power to Government to apply Act of exempted persons or establishments
No withstanding anything contained in section 4, the Government may, by
notification apply or any of the provisions of this Act to any class of persons or
establishment mentioned in that section, other than those mentioned in clause (c)
and (f) of sub-section (1), and modify or cancel any such notification
Exemptions
The Government may, by notification, exempt either permanently or for any
specified period, any establishment or class of establishments or person or class of
persons, from all or any of the provisions of this Act, subject to such conditions as
the Government deem fit.
Opening and closing hours of shops
1) Save as provided by order or under other enactment for the time being in force,
no shop shall on any date be opened earlier or closed later than such hours as
may be fixed by the (State) Government, by a general or special order in that
behalf: provided that any customer who was being served or was waiting to be
served in any shop at the hour fixed for its closing may be served during the
quarter of an hour immediately following such hour.
2) Before passing an order under sub section (1), the (State) government shall hold
an inquiry in the prescribed manner.
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3) The (State) government may, for the purpose of this section, fix different hours
for different shops or different classes of shops or for different areas or for
different times of the year.
Selling out Side shops prohibited after closing hour
Save as provided by or under any other enactment for the time being in force,
no person shall carry on, in or adjacent to a street or public place, the sale of any
goods after the hour fixed under section 7 for the closing of shops dealing in the
same class of goods in the locality in which such street or public place is situated:
Provided that nothing in this section shall apply to the sale of newspapers.
Daily and weekly hours of work in shops
1) Subject to the provision of this Act, no person employed in any shop shall be
required or allowed to work therein for more than eight hours in any day and
forty eight hours in any week: Provided that any such person may be allowed
to work in such shop for any period in excess of the limit fixed under this sub
section subject to payment of overtime wages, if the period of work including
overtime work, does not exceed ten hours in any day and in the aggregate
fifty-four hours in any week.
2) No person employed in any shop shall be required or allowed to work therein
for more than four hours in any day unless he has had an interval for rest of
at least one hour.
Spread over of period of work
The periods of work of a person employed in a shops hall be so arranged
that, along with his intervals for ret, they shall not spread over more than twelve
hours in a day.
Closing of shops and grant of holidays
1) Every shop shall remain entirely close on one day of the week which day
shall be specified by the shopkeeper in a notice permanently exhibited in a
conspicuous place in the shop; and the day so specified shall not be altered
by the shopkeeper more often than once in three months.
2) Every person employed in a shop shall be allowed in each week a holiday of
one whole day; Provided that nothing in this sub section shall apply to any
person whose total period of employment in the week, including any days
spent on authorized leave, is less than six days, or entitle a person who has
been allowed a whole holiday on the day on which the shop has remained
closed in pursuance of sub section (1), to an additional holiday
3)
a) The (State) government may, by notification, require in respect of shops or
any specified class of shops, that they shall, in addition to the day
provided for by subsection (1), be closed at such hour in the afternoon of
one week f/day in every week at such hour as may be fixed by the (State)
Government.
b) Every person employed in any shop to which a notification under clause (a)
applies, shall be allowed in each week an additional holiday of one half day
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commencing at the hour in the afternoon fixed for the closing of the shop
under clause (a)
4) The (State) government may, for the purpose of sub section (3), fix different
hours for different shops or different classes of shops or for different areas or
for different times of the year.
5) The weekly day on which a shop is closed in pursuance of requirement
under subsection (3) shall be made from the wage of any person employed in
a shop on account of any day or part of a day on which it has remained
closed or a holiday has been allowed in accordance with this section; and if
such person is employed on the basis that he would not ordinarily receive
wages for such day or part of a day, he shall nonetheless be paid for such
day or part of a day the wages he would have drawn, had the shop not
remained closed, or had the holiday not been allowed, on that day or part of
a day.
Establishments other than shops
Application of this chapter to establishments other than shops:
The provisions of this chapter shall apply only to establishments other than
shops.
Opening and closing hours:
1) Save as provided by or under any other enactment for the time being in force,
no establishment shall be opened earlier or closed later than such hour as
may be fixed by the Government, by general or special order in that behalf:
Provided that in the case of a restaurant or eating house, any customer who
was being served or was waiting to be served therein at the hour fixed for the
closing may be served therein at the hour fixed for the closing may be served
during the quarter of an hour immediately following such hour.
2) Before passing an order under sub-section (1), the Government shall make an
inquiry in the prescribed manner.
3) The Government may, for the purposes of this section, fix different hours for
different hours for different establishments or for different areas or for
different times of the year
Daily and weekly hours of work:
1) Subject to the provisions of this Act, no person employed in any establishment
shall be required or allowed to work for more than eight hours in any day and
forty-eight hours in any week: Provided that any such person may be allowed
to work in such establishment for any period in excess of the limit fixed under
this sub-section subject to payment of overtime wages, if the period of work,
including overtime work, does not exceed ten hours in any day and in the
aggregate fifty-four hours in any week.
2) No person employed in any establishment shall be required or allowed to work
in such establishment for more than four hours in any day unless he has had
an interval rest at least one hour.
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Spread over of periods of work

The periods of work of a person employed in an establishment shall be so
arranged that along with his intervals for rest, they shall not spread over more than
twelve hours in any day.
Holidays
1) Every person employed in an establishment shall be allowed in each week a
holiday of one whole day: Provided that nothing in this sub-section shall apply
to any person whose total period of employment in the week, including any
days spent on authorized leave, is less than six days.
2) The Government may, by notification, require in respect of any establishment
or any specified class of establishments, that every person employed therein
shall be allowed in each week an additional holidays of one half day
commencing, at such hour in the afternoon as may be fixed by the
Government.
3) The Government may, for the purpose of sub-section (2), fix different hours for
different class of establishments or different classes of establishments or for
different areas or for different times of the year.
4) No deduction shall be made from the wages of any person employed in an
establishment on account of any day or part of a day on which a holiday has
been allowed in accordance with this section; and if such person is employed
on the basis that he would not ordinarily receive wages for such day or part of
a day, he shall non ethe less be paid for such day or part of a days the wages
he would have drawn, had the holiday not been allowed on that day or part of
a day.
Employment of Children and Young Persons
Children not to work in establishments
No child shall be required or allowed to work in any establishment.
Young person’s to work only between 6 a.m. and 7 p.m.
No Young person shall be required to work in any establishment before 6 a.m.
and after 7 p.m.
Daily and weekly hours of work for young persons
Notwithstanding anything contained in this Act, no young person shall be
required or allowed to work in any establishment for more than seven hours in any
and forty-two hours in any week nor shall such persons be allowed to work
overtime.
HEALTH AND SAFETY
Cleanliness
The premise of every establishment shall be kept clean and free from effluvia
arising from any drain or privy or other nuisance and shall be cleaned at such
times and by such methods as may be prescribed; and these methods may include
lime washing, color washing, painting, varnishing, disinfecting and deodorizing.
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Ventilation
The premises of every establishment shall be ventilated in accordance with
such standards and by such methods as may be prescribed.
Lighting
1) The premises of every establishment shall be sufficiently lighted during all
working labours.
2) If it appears to an Inspector that the premises of any establishment within his
jurisdiction is not sufficiently lighted or ventilated, he may serve on the
employer an order in writing specifying the measures which, in his opinion,
should be adopted and requiring them to be carried out before a specified
date.
Precautions against fire
In every establishment, such precautions against fire shall be taken as may be
prescribed.
Appeal
Against any order of the Inspector under this chapter, an appeal shall lie to
such authority and within such time as may be prescribed; and the decision of the
appellate authority shall be final.
Holidays with Wages
Holidays and sick leave
1) Every person employed in any establishment shall be entitled, after twelve
months continuous service, to holidays with wages for a period of 12 days, in
the subsequent period of twelve months: provided that such holidays with
wages may be accumulated upto a maximum of twenty-four days.
2) Every person employed in any establishment shall also be entitled during his
first twelve months of continuous service after the commencement of this Act,
and during every subsequent twelve months of such service.
a) to leave with wages for a period not exceeding twelve days, on the ground
of any sickness incurred or accident sustained by him and
b) to casual leave with wages for a period not exceeding twelve days on any
reasonable ground.
3) If a person entitled to any holidays under sub-section (1) is discharged by his
employer before he has been allowed the holidays, or if having applied for and
been refused the holidays, he quits his employment before he has been
allowed the holidays, the employer shall pay him the amount payable under
this act in respect of the holidays.
4) If a person entitled to any leave under sub-section (2) is discharged by this
employer when he is sick of suffering from the result of an accident, the
employer shall pay him the amount payable under this act in respect of the
period of the leave to which he was entitled at time of his discharge, in
addition to the amount, if nay payable to him under sub-section (3).
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5) A person employed shall be deemed to have completed a period of twelve

months continuous service within the meaning of this section, not
withstanding any interruption in service during those twelve months brought
about (i) by sickness, accident, or authorized leave not exceeding 90 days in
the aggregate of all three, (ii) by a lockout (ii) by a strike which is not an illegal
strike (iv) by intermittent periods of involuntary unemployment not exceeding
thirty days in the aggregate and authorized leave shall be deemed not to
include any weekly holiday or half-day holiday under this act which occurs at
the beginning or end of an interruption brought about by the leave.
6) A person employed in a hostel attached to a school or college or in an
establishment maintained in a boarding school and lodging of pupils and
resident masters shall be allowed the privileges referred to in sub-sections (1)
to (5), reduced however proportionately to the period for which he was
employed continuously in the previous year or to the period for which he will
be employed continuously in the current year, as the case may be; and all
references to periods of holidays or of leave in sub-sections 91) and (2) shall be
construed accordingly, fractions of less than one day being disregarded. (7)
The Government shall have power to issue directions as to the manner in
which the provisional of sub-section (6) shall be carried into effect in all or any
class of case or in any particular case.
Pay during annual holidays
Every person employed shall, for the holidays or the period of leave allowed
under sub-section (1) or (2) of section 25, be paid at a rate equivalent to the daily
average of his wages for the days on which he actually worked during the preceding
three months exclusive of any earnings in respect of overtime.
Power to increase the number of holidays
Not-withstanding anything contained in section 25, the government may, by
notification, increase the total number of annual holidays and the maximum
number of days up to which such holidays may be accumulated in respect of any
establishment or class of establishments.
Power of Inspector to act for person employed
Any Inspector may institute proceedings on behalf of any person employed to
recover any sum required to be paid under this chapter by an employer which he
has not paid.
WAGES
Responsibility for payment of wages
Every employer shall be responsible for the payment to persons employed by
him of all wages and sums required to be paid under this act.
Fixation of wage period
1) Every employer shall fix periods (in this act referred to as wage period) in
respect of which such wages shall be payable.
2) No wage period shall exceed one month.
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Wages for overtime work

Where any person employed in any establishment is required to work overtime,
he shall be entitled, in respect of such overtime work, to wages at twice the
ordinary rate of wages.
Time for payment of wages
1) The wages of every person employed shall be paid before the expiry of the fifth
day after the last day of the wage period in respect of which the wages are
payable.
2) Where the employment of any person is terminated by or on the behalf of the
employer, the wages earned by such person shall be paid before the expiry of
the second working day from the day on which his employment is terminated.
3) The state government may, by general or special order, exempt an employer
from the operation of this section in respect of the wages of any person
employed or class of persons employed, to such extent and subject to such
conditions as may be specified in the order.
4) All payments of wages shall be made on the working day.
Wages to be paid in current coin or currency notes
All wages shall be paid in current coin or currency notes or both.
Deduction which may be made from wages
1) The wages of a person employed shall be paid to him without deductions of
any kind except those authorized by or under this act.
2) deduction from the wages of a person employed shall be made only in
accordance with the provisions of this Act, and may be of the following kinds
only, namely:
a) fines:
b) deductions for absence from duty:
c) deductions for damage to, or loss of, goods expressly entrusted to the
employed person for custody, or for loss of money for which he is required
to account, where such damage or loss is directly attributable to his
neglect or default:
d) deductions for house accommodations supplied by the employer:
e) deductions for such amenities and services applied by the employer as the
government may, by general or special order, authorize:
f) deductions for recovery of advances or for adjustment of overpayments of
wages:
g) deductions of income tax payable by the employed person:
h) deductions requirement to be made by order of a court or other authority
competent to make such order
i) deductions for subscription to, and for repayment of advances from, any
provident fund to which the provident funds act 1952 applies or any
recognized has defined in section 58A of the Indian income tax act 1922,
or any provident approval in this behalf by the (state) government during
the continuance of such approval:
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j) Deduction for payments to co operative societies approved in this behalf

by the (state) government or to a scheme of insurance maintained by
Indian post office or by any insurance company approved in this behalf by
the (state) government:
k) Deductions made with the return authorization of the employed person in
furtherance of any saving schemes approved by the (state) government for
the purchase of securities of the central or (state) government.
Notice of dismissal
1) No employer shall dispense with the services of a person employed
continuously for a period of not less than 6 months, except for a reasonable
cause and without giving such person at least 1 months notice or wages in
lieu of such notice, provided however, that such notice shall not be necessary
where the services of such person are dispensed with on a charge of
misconduct supported by satisfactory evidence recorded at an enquiry held for
the purpose.
2) The person employed shall have a right to appeal to such authority and within
such time as may be prescribed either on the ground that there was no
reasonable cause for dispensing with its services or on the ground that he had
not been guilty of misconduct as held by the employer.
3) The decision of the appellate authority shall be final and binding on both the
employer AND THE PERSON employed. CHAPTER VIII APPOINTMENT,
POWERS AND DUTIES OF INSPECTORS.
A. Payment of full wages to person employed pending proceeding proceedings in Higher Courts
Where in any case, the appellate authority, by its decision under section 41,
directors reinstatement of any person employed and the employer prefers any
proceeding against such decision in a High Court of the Supreme Court, the
employer shall be liable to pay such person employed, during the period of
pendency of such proceedings in the High Court of the Supreme Court, full wages
last drawn by him, inclusive of any maintenance allowance admissible to him
under any rule if the person employed had not been employed in any establishment
during such period and an affidavit by such person employed had been filed to that
effect in such court:
Provided that where it is provided to the satisfaction of the High Court or the
Supreme Court that such person employed had been employed and had been
receiving adequate remuneration during any such period or part thereof, the Court
shall order that no wages shall be payable under this section for such period or
part, as the case may be.
Statutory Provisions Relating to Health and Safety under the Mines Act, 1952
The Mines Act, 1952, and the rules framed there under are elucidated to make
sure a sufficient supply of cool and wholesome drinking water for all employees,
medical appliances during all working hours, notice of the occurrence of accidents,
power of Government to appoint Court of Inquiry in cases of accidents, notice a
134
disease connected with mining operations, and power of direct investigation of

causes of disease.
1. Drinking water
In every mine effective arrangements shall be provided and maintained, at
suitable points and conveniently situated, a sufficient supply of cool and
wholesome drinking water for all persons employed therein.
2. Conservancy
There shall be provided, separately for males and females in every mine, a
sufficient number of latrines and urinals of prescribed types so situated as to be
convenient and accessible to persons employed in the mine at all times.
3. Medical appliances
a) In every mine, there shall be provided and maintained so as to be readily
accessible during all working hours such number of first-aid boxes or
cupboards equipped with such contents as may be prescribed.
b) Nothing except the prescribed contents shall be kept in the first-aid box or
cupboards or room.
c) Every first-aid box or cupboard shall be kept in the charge of a responsible
person who is trained in such first aid as may be prescribed and who shall
always be readily available during the working hours of the mine.
d) In every mine, there shall be made so as to be readily available such
arrangements as may be prescribed who shall always be readily available
during the working hours of the mine.
e) In every mine wherein more than one hundred and fifty persons are employed,
there shall be provided and maintained a first-aid room of such size with such
equipment and in the charge of such medical and nursing staff as may be
prescribed.
4. Notice to be given of accidents
(a) Whenever there occurs in or about a mine
i. an accident causing loss of life of serious bodily injury, or
ii. an explosion, ignition, spontaneous heating, outbreak of fire of irruption or
inrush of water or other liquid matter, or
iii. an influx of inflammable or noxious gases, or
iv. a breakage of ropes, chains or other gear by which persons or materials are
lowered or raised in a shaft or an incline, or
v. an over-winding of cages or other means of conveyance in any shaft while
persons or materials are being lowered or raised, or
vi. premature collapse of any part of the workings, or
vii. any other accident which may be prescribed.
the owner, agent or manager of the mine shall give notice of the occurrence to such
authority in such form and within such times as may be prescribed, and he shall
simultaneously post one copy of the notice on a special notice board in the
prescribe manner at a place where it may be inspected by trade union officials, and
135
shall ensure that the notice is kept on the board for not less than fourteen days
from the date of such posting.
5. Power of Government to appoint Court of Inquiry in cases of accidents
When any accident of the nature referred to in any of the clauses of Subsection
(I) of Section 23 occurs in or about a mine, the Central Government may, if it is of
opinion that a formal inquiry into the causes of and circumstances attending the
accident ought to be held, appoint a competent person to hold such inquiry and
may also appoint one or more persons possessing legal or special knowledge to act
as assessor or assessors in holding the inquiry.
6. Notice of Certain diseases
Where any person employed in a mine contracts any disease notified by the
Central Government in the Official Gazette as a disease connected with mining
operations, the owner, agent or manager of the mine, as the case may be, shall
send notice thereof to the Chief Inspector and to such other authorities, in such
form and within such time as may be prescribed.
7. Power of direct investigation of cause of disease
The Central Government may, if considers it expedient to do so, appoint a
competent person to inquire into and report it on any case where a disease notified
under Subsection (I) of Section 25 has been or is suspected to have been contracted
in a mine, and may also appoint one or more persons possessing legal or special
knowledge to act as assessors in such inquiry.
Section 9A was introduced in the Mines (Amendment) Act, 1983, which
provides for safety and occupational health survey in a mine by the Chief Inspector
or other office authorized by him after giving notice in writing to the manager of the
mine. The owner, agent or manager is required to give all necessary facilities
examination of persons and in conducting the survey.
The provisions of bill come in Force in the First Instance in the city of Madras.
Bill will apply to person employed in shops, commercial firm, restaurants, theater
etc. but will not apply to certain establishments and person under central or
provisional govt., There are provisions intended to ensure prompt payment of wages
and prohibition of unauthorized deduction from wages and follow mainly those of
the payment of wages Act 1936. Suitable penalties has been prescribed for
contravention of the different provision of the bill.
18.5 INTEXT QUETIONS
1) Discuss the openings and closing hours of shop under this Act.
2) Discuss the holidays with wages under this Act.
3) Discuss the various types of deductions from wages under this Act.
18.6 SUMMARY
The chapter II & III of this bill enable Govt., to fix the opening and closing
hours of shops, commercial firms and restaurant.
136
The sale of goods other than newspaper in or adjacent to a street or public

place after closing hours fixed for shops in that locality has been prohibited.
Provisions has also been made as in the weekly holidays Act 1942 for granting to
the persons.
Employed a compulsory holiday for one day in a week and if required by Govt.,
half - holiday also in a week under Mines Act 1952, the rules makes sure a
sufficient supply if wholesome and cool drinking water for all employees. Medical
appliances during all working hours, notice of occurrences of accidents, power of
Govt. to appoint court of inquiry in case of accidents, notice of a disease connected
with mining operations.
1) Discuss the various provisions under this Act for accruing the health and
safety of the staff.
2) Discuss the responsibility for payment of wages, fixing of wage period and
wages for overtime work under this Act.
3) Discuss the power of Govt. to appoint court of enquiry in case of accidents
under the Mines Act 1952.
1) Andhra Scientific Company Employees Union Vs Manager (9170) LLI 555 (AP)
2) Hindustan Lever Vs workman, AIR 1975.
3) Industrial Relations Labour Welfare and Labour Laws by B. Nandha Kumar.
18.9 ASSIGNMENTS
1) What are the penalties for obstructing the Inspector?
2) Describe the method of maintenance of registers and record.
3) Discuss the powers and duties of Inspector.
1) Personnel Management and Industrial Relations, 19th Edition By P.C,. Tripathe.
2) C.B.Memoria Dynamics of Industries Relations in India “Himalaya
Publishing House”, 2008
3) N.G.Nair, “Personnel Management and Industrial Relations”.
1) Discuss with your friends the rights & privileges under law.
2) Discuss the deductions for damage or loss and deductions for absence from duty.
18.12 KEY WORDS
1) Compounding
2) Exempted
3) Establishment
4) Premises
5) Commercial

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LESSON - 19
PLANTATION LABOUR ACT

19.1 INTRODUCTION
This Act is called the plantations Labour Act 1951. It is applicable to whole
of India except the state of J&K. This Act covers provisions as to health and welfare.
This covers includes the inspectors their powers and functions. This Act also
includes the hours and limitation of employment. This Act deals with leave with
wages and penalties and procedure.
19.2 OBJECTIVES
 Short title extent, commencement and application.
 Definitions
 Inspecting staff - powers and functions
 Provisions as the health and welfare.
 Hours and limitation of employment
 Leave with wages
 Penalties and procedure.
19.3 CONTENTS
The Plantations Labour act, 1951
An Act to provide for the welfare of labour, and to regulate the conditions of
work, in plantations.
BE it enacted by Parliament as follows:-
1) Short title, extent, commencement and application
1) This Act may be called the Plantations Labour Act, 1951.
2) It extends to the whole of India except the State of Jammu and Kashmir.
3) It shall come into force on such date as the Central Government may, by
notification in the Official Gazette, appoint.
4) It applies in the first instance to all tea, coffee, rubber and cinchona
plantations, but any State Government may, subject to the previous
approval of the Central Government, by notification in the Official Gazette,
apply it to any other class of plantations within that State.
2) Definitions
In this Act, unless the context otherwise requires,-
a) “adolescent” means a person who has completed his fifteenth year but has
not completed his eighteenth year;
b) “adult” means a person who has completed his eighteenth year;
c) “child” means a person who has not completed his fifteenth years”;
d) “day” means a period of twenty-four hours beginning at midnight;
e) “employer” when used in relation to a plantation means the person who has
the ultimate control over the affairs of the plantations, and where the affairs
138
of any plantation are entrusted to any other person (whether called a

managing agent, manager, superintendent or by any other name) such other
person shall be deemed to be the employer in relation to that plantations;
f) “plantation” means any land used or intended to be used for growing tea,
coffee, rubber or cinchona which admeasures twenty-five acres or more and
whereon thirty or more persons are employed, or were employed on any day
of preceding twelve months, and in any State where the provisions of this
Act have been applied by notification under sub-section (4) of section 1 to
any other class of plantations, means also any land used or intended to be
used for growing the plant mentioned in such notification and whereon
thirty or more persons are employed, or were employed on any day of the
preceding twelve months;
g) “prescribed” means prescribed by rules made under this Act;
h) “qualified medical practitioner” means a person having a certificate granted
by an authority specified in the Schedule to the Indian Medical Council Act,
1933 (XXVII of 1933) and also persons having certificates granted under the
different State (Provincial)
i) “wages” has the meaning assigned to it in clause (h) of section 2 of Minimum
Wages Act, 1948 (XI of 1948);
j) “worker” mans a person employed in a plantation for hire or reward, whether
directly or through and agency, to do any work, skilled, unskilled, manual or
clerical, but does not include -
i. a medical officer at the plantations;
ii. any person whose monthly wages exceed three hundred rupees; or
iii. a person employed in a plantation primarily in a management capacity
notwithstanding that his monthly wages do not exceed rupees three
hundred;
k) “young person” means a person who is either a child or an adolescent.
3) Reference to time of day
In this Act, reference to time of day references of Indian Standard time being
five and a half hours ahead of Greenwich Mean time:
Provided that for any area in which the Indian Standard time is not ordinarily
observed the, State Government may make rules-
a) specifying the area;
b) defining the local mean time ordinarily observed therein and
c) permitting such time to be observed in all or any of the plantation
situated in that area.
Inspections Staff
4) Chief Inspector and inspectors
(1) The State Government may, by notification in the Official Gazette, appoint for
the State a duly a qualified person to be the chief inspector or plantations and
so many duly qualified persons to be inspectors or plantations subordinate to
the chief inspector as it thinks fit.
139
2) Subject to such rules as may be made in this behalf by the State Government,
the chief inspector may declare the local area or areas within which, or the
plantations with respect to which, inspectors shall exercise their powers
under this At, and may himself exercise the powers of an inspector within
such limits as may be assigned to him by the State Government.
3) The chief inspector all inspectors shall be deemed to be public servants within
the meaning of the Indian Penal Code (Act XLV of 1860)
5) Powers and functions of inspectors
Subject to any rules made by the State Government in this behalf, an
inspector may within the local limits for which he is appointed--
a) make such examination and inquiry as he thinks fit in order to ascertain
whether the provisions of this Act and of the rules made thereunder are being
observed in the case of any plantation;
b) with such assistants, if any, as he thinks fit, enter, inspect and examine any
plantation or part thereof at any reasonable time for purpose of carrying out
the objects of this Act;
c) examine the crops grown in any plantation or any worker employed therein or
require the production of any register or other document maintained in
pursuance of this Act, and take on the spot or otherwise statements of any
person which he may consider necessary for carrying out the purposes of this
Act;
d) exercise such other powers as may be prescribed:
Provided that no person shall be compelled under section to answer any
question or make any statement tending to incriminate himself.
6) Facilities to be afforded to inspectors
Every employer shall afford the inspector all reasonable facilities for making any
entry, inspection, examination or inquiry under this Act.
7) Certifying surgeons
(1) The State Government may appoint qualified medical practitioners to be
certifying surgeons for the purposes of this Act within such local limits or for
such plantation or class of plantation or class of plantations as it may assign
to them respectively.
2) The certifying surgeon shall carry out such duties as may be prescribed in
connection with-
a) the examination and certification of workers;
b) the exercise of such medical supervisions as may be prescribed where
adolescents and children are, or are to be, employed in any work in any
plantation which is likely to cause injury to their health.
PROVISIONS AS TO HEALTH
8) Drinking water
In every plantation effective arrangement shall be made by employer to provide
and maintain at convenient places in the plantation a sufficient supply of wholesale
drinking water for all workers.
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9) Conservancy
(1) There shall be provided separately for males and females in every plantation a
sufficient number of latrines and urinals of prescribed type so situated as to
be convenient and accessible to workers employed therein.
2) All latrines and urinals provided under sub-section (1) shall be maintained in
a clean and sanitary condition.
10) Medical facilities
(1) In every plantation there shall be provided and maintained so as to be readily
available such medical facilities for the workers as may be prescribed by the State
Government.
2) If in any plantation medical facilities are not provided and maintained as required
by sub-section (1) the chief inspector may cause to be provided and maintained
therein such medical facilities, and recover the cost thereof from the defaulting
employer.
3) For the purposes of such recovery the chief inspector may certify the costs to be
recovered to the collector, who may recover the amount as an arrear of land-
revenue.
Welfare
11) Canteens
1) The State Government may make rules requiring that in every plantation
wherein one hundred and fifty workers, are ordinary employed, one or more
canteens shall be provided and maintained by the employer for the case of all
the workers.
2) Without prejudice to the generality of the foregoing power, such rules provide
for-
a) the date by which the canteen shall be provided;
b) the number of canteens that shall be provided and the standards in
respect of construction, accommodation, furniture and other equipment of
the canteens;
c) the food-stuffs which may be served therein and the charges which may
be made therefore;
d) the constitution of a managing committee for the canteen and the
representation of the workers in the management of the canteen;
e) the delegation to the chief inspector, subject to such conditions as may be
prescribed, of the power to make rules under clause (c).
12) Creches
(1) In every plantation wherein fifty or more women workers are employed or
were employed on any day of the preceding twelve months, there shall be
provided and maintained by the employer suitable rooms for the use of
children of such women who are below the age of six years.
2) Such room shall-
141
a) provide adequate accommodation;

b) the adequately lighted and ventilated;
c) be maintained in a clean and sanitary condition; and
d) be under the charge of a woman trained in the care of children and
infants.
3) The State Government may make rules prescribing the location and the
standards of such room in respect of their construction and accommodation
and the equipment and amenities to be provided therein.
13) Recreational facilities
The State Government may make rules requiring every employer to make
provisions in his plantation for such recreational facilities for the workers and
children employed therein as may be prescribed.
14) Educational facilities
Where the children between the ages of six and twelve of workers employed in
any plantation exceed twenty-five in number, the State Government may make
rules requiring every employer to provide educational facilities for the children in
such manner and of such standard as may prescribed.
15) Housing facilities
It shall be duty of every employer to provide and maintain for every worker and
his family residing in the plantation necessary housing accommodation.
16) Power to make rules relating to housing
The State Government may make rules for the purpose of giving effect to the
provisions of section 15 and, in particular providing for-
a) the standard and specification of the accommodation to be provided;
b) the selection and preparation of sites for the construction of houses and the
size of such plot;
c) the constitution of advisory boards consisting of representatives of the State
Government, the employer and the workers for consultation in regard to
matters connected with housing and the exercise by them of the such powers,
functions and duties in relation thereto as may be specified;
d) the fixing or rent, if any, for the housing accommodation provided for workers;
e) the allotment to workers and their families of housing accommodation and of
suitable strips of vacant land adjoining such accommodation for the purpose
of maintaining kitchen gardens, the definition of what constitutes the family of
a worker for the purposes of maintaining kitchen gardens, the definition of
what constitutes the family of a workers for the purposes of section 15, and
for the eviction of workers and their families from such accommodation;
f) access to the public to those parts of the plantation wherein the works are
housed.
17) Welfare officers
(1) In every plantation wherein three hundred or more workers are ordinarily
employed the employer shall company such member of welfare officers as may
be prescribed.
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2) The State Government may prescribed the duties, qualifications and conditions
of service of officers employed under sub-section (1).
Hours and limitation of employment
18) Weekly hours
Save as otherwise expressly provided in this Act, no adult worker shall be
required or allowed to work on any plantation in excess of fifty-four hours a week
and no adolescent or child for more than forty hours a week.
19) Weekly holidays
(1) The State Government may by rules made in this behalf-
a) provide for a day of rest in every period seven days which shall be allowed
to all workers;
b) provide for payment for work done on a day of rest at a rate not less than
the overtime rate prevailing in the area, and where is no such rate as may
be fixed by the State Government in this behalf.
20) Notwithstanding anything contained in clause (a) of sub-section
(1) Where a worker is willing to work on any day of rest which is not a closed
holiday in the plantation, nothing contained in this section shall prevent him
from doing so:
a) Provided that in so doing worker does not work for more than ten days
consecutively without a holiday for a whole day intervening.
Explanation 1 - Where on any day a worker has been prevented from working
in any plantation by reason of tempest, fire, rain or other natural causes,
that day, may, if he so desires, be treated as his day of rest for the relevant
period of seven days within the meaning of sub-section (1).
Explanation 2 - Nothing contained in this section shall apply to any worker
whose total period of employment including any day spent on leave is less
than six days.
21) Daily intervals for rest
The period of work on each day shall be so fixed that no period shall exceed
five hours and that no workers shall work for more than five hours before he has
had an interval for rest for at least half an hours,.
22) Spread-over
The period of work of and adult worker in a plantation shall be so arranged
that inclusive of this interval for rest under section 19 it shall not spread-over more
than twelve hours including the time spent in waiting for work on any day.
23) Notice of Period of work
(1) There shall be displayed and correctly maintained in every plantation a
notice of periods of work in such form and manner as may be prescribed
showing clearly for every day the periods during which the workers may be
required to work.
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2) Subject to the other provisions contained in this Act, no worker shall be

required or allowed to work in any plantation otherwise than in accordance
with the notice of periods of work displayed in the plantation.
3) An employer may refuse to employ a worker for any day if on that day he
turns up for work more than half an hour after the time fixed for the
commencement of the day’s work.
24) Prohibition of employment of young children
No child who has not completed his twelfth years shall be required or allowed
to work in any plantation.
25) Night work for women and children
Except with permission of the State Government, no woman or child worker
shall be employed in any plantation otherwise than between the hours of 6 A.M.
and 8 P.M. Provided that nothing in this section shall be deemed to apply to
midwives and nurses employed as such in any plantation.
26) Non-adult workers to carry tokens
No child who has completed his twelfth year and no adolescent shall be
required or allowed to work if any plantation unless-
a) a certificate of fitness granted with reference to him under section 27 is in the
custody of the employer; and
b) such child or adolescent carries with him while he is at work a token giving a
reference to such certificate.
27) Certificate of fitness
(1) A certifying surgeon, shall on the application of any young person or his
parent or guardian accompanied by a document signed by the employer or
any other person on his behalf that such person will be employed in the
plantation if certified to be fit for work, or on the application of the employer
or any other person on his behalf with reference to any young person
intending to work, examine such person and ascertain his fitness for work
either as a child or as adolescent.
2) A certificate of fitness granted under this section shall be valid for a period of
twelve months from the date thereof, but my be renewed.
3) Any fee payable for a certificate under this section shall be paid by the
employer and shall not be recoverable from the young person, his parents or
guarding.
28) Power to required medical examination
An inspector may, if he thinks necessary so to do, cause any young person
employed in a plantation to be examined by a certifying surgeon.
LEAVE WITH WAGES
29) Application of Chapter
(1) The provisions of this Chapter shall not operate to the prejudice of any right to
which a worker may be entitled under any other law or under the terms of any
award, agreement, or contract of service:
144
Provided that where such agreement or contract of service provided in section 30,
include weekly holidays or holidays for festivals or other similar occasions.
Explanation - For the purpose of this Chapter leave shall not, except as provided
in section 30, include weekly holidays or holidays for festivals or other similar
occasions.
30) Annual leave with wages
1) Every worker shall be allowed leave with wages for a number of days
calculated at the rate of-
 if an adult, one day for every twenty days of work performed by him, and
 if a young person, one day for every fifteen days of work performed by him:
 Provided that a period of leave shall be inclusive of any holiday which may
occur during such periods.
2) If a worker does not in any one period of twelve months take the whole of the
leave allowed to him under sub-section (1) any leave not taken by him shall
be added to the leave to be allowed to him under that sub-section in
succeeding period of twelve months.
3) A worker shall cease to earn any leave under this section when the earned
leaved due to him amounts to thirty days.
32) Wages during leave period
1) For the leave allowed to a worker under section 30 he shall be paid at the rate
equal to the daily average of his total full-time wages, exclusive of any
overtime earning and bonus, if any, but inclusive of dearness allowances and
the cash equivalent of any advantages accruing by the concessional supply by
the employer of foodgrains for the day on which he worked.
2) A worker who has been allowed leave for any period less, than four days in the
case of an adult and five days in the case of a young person under section 30
shall, before his leave begins, be paid his wages for the period of the leave
allowed.
33) Sickness and maternity benefits
1) Subject to any rules that may be made in this behalf, every worker shall be
entitled to obtained from his employer in the case of sickness certified by a
qualified medical practitioner, sickness allowance, and if a woman, in the case
of confinement or expected confinement, maternity allowance at such, rate for
such period and at such intervals as may be prescribed.
2) The State Government may make rules regulating the payment of sickness or
maternity allowance and any such rules may specify the circumstances in
which such allowance shall not be payable or shall cease to be payable, and in
framing any rules under this section the State Government shall have due
regard to the medical facilities that may be provided by the employer in any
plantation.
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Penalties and procedure

34) Obstruction
(1) Whoever obstructs an inspector in the discharge of his duties under this Act or
refuses or willfully neglects to afford the inspector any reasonable facility or
making any inspection, examination or inquiry authroised by or under this
Act in relation to any plantain, shall be punishable with imprisonment for a
term which may extend to three months, or with fine which may extend to five
hundred rupees or with both.
2) Whoever willfully refuses to produce on the demand of an inspector any
register or other document kept in pursuance of this Act or prevents or
attempts to prevent or does anything which he has reason o believe is likely to
prevent any person from appearing before or being examined by an inspector
acting in pursuance of his duties under this Act, shall be punishable with
imprisonment for a term which may extend to three months or with fine which
may extend to five hundred rupees, or with both.
35) Use of false certificate of fitness
Whoever knowingly uses or attempts to use a certificate of fitness granted to
himself under section 27 a certificate to another person under that section, or
having been granted a certificate of fitness to himself, knowingly allows it to be
used, or allows an attempt to use it to be made by another person, shall be
punishable with imprisonment which may extend to one month, or with fine which
may extent to fifty rupees, or with both.
36) Contravention of provisions regarding employment of labour
Whoever, except at otherwise permitted by or under this Act, contravenes any
provision of this Act or of any rules made thereunder, prohibiting, restricting or
regulating the employment of persons in a plantation, shall be punishable with
imprisonment for a term which may extend to three months or with the fine which
may extend to five hundred rupees, or with both.
37) Enhanced penalty after previous conviction
If any person who has been convicted of any offence punishable under this Act is
again guilty of an offence involving a contravention of the same provision, he shall be
punishable on a subsequent conviction with imprisonment which may extend to six
months or with fine which may extend to one thousand rupees, or with both:
Provided that for the purposes of this section no cognizance shall be taken of
any conviction made more than two year before the commission of the offence
which is being punished.
38) Exemption of employer from liability in certain cases
Where an employer charged with an offence under this Act, alleges that another
person is the actual offender, he shall be entitled upon complaint made him in this
behalf, to have, on giving to the prosecutor in this behalf three clear days notice in
writing of his intention so to do, that other person brought before the court on the day
appointed for the hearing of the case and if, after the commission of the offence has
been proved, the employer proves to the satisfaction of the court that-
a) he has used due diligence to enforce the execution of the relevant provisions of
this Act; and
146
b) that the other person committed the offence in question without his
knowledge, consent or connivance:
the said other person shall be convicted of the offence and shall be liable to the like
punishment as if he were the employer and the employer shall be acquitted:
Provided that--
a) the employer may be examined on oath his evidence and that of any witness
whom he calls in his support shall be subject to cross-examination on behalf
of the person he charges to be the actual offender any by the prosecutor, and
b) If, in spite of due diligence, the person alleged as the actual offender cannot be
brought before the court on the day appointed for the hearing of the case, the
court shall adjourn the hearing thereof from time to tome so, however, that
the total period of such adjournment does not exceed three months, and if, by
the end of the said period, the person alleged as the actual offender cannot
still be brought before the court, the court shall proceed to hear the case
against the employer.
39) Cognizance of offences
No court shall take cognizance of any offence under this Act except on complaint
made by, or with previous sanction in writing of, the chief inspector and no court
inferior to that of a presidency magistrate or a magistrate of the second class shall try
any offence punishable under this Act.
40) Limitation of prosecutions
No court shall take cognizance of an offence punishable under this Act unless the
complaint thereof has been made or is made within three months from the date on
which the alleged commission of the offence came to the knowledge of an inspector:
Provided that where the offence consists of disobeying a written order made by an
inspector, complaint thereof may be made within six months of the date on which the
offence is alleged to have been committed.
Miscellaneous
41) Power to give directions
The Central Government may give directions to the Government of any State as to
the carrying into execution in the State of provisions contained in this Act.
42) Power to exempt
The State Government may, by order in writing, exempt, subject to such
conditions and restrictions as it may think fit to impose, any employer or class of
employers from all or any of the provisions of this Act:
Provided that no such exemption shall be granted except with the previous
approval of the Central Government.
43) General power to make rules
(1) The State Government may, subject to the condition of previous publication,
make rules to carry out the purposes of this Act:
Provided that the date to be specified under clause (3) of section 23 of the
General Clauses Act, 1897 (X of 1897) shall not be less than six weeks from the
date on which the draft of the proposed rules was published.
147
2) In particular and without prejudice to the generality of the foreign power, any such
rules may provide for --
a) the qualifications required in respect of the chief inspector and inspector;
b) the powers which may be exercised by inspectors and the areas in which
and the manner in which such powers may be exercised;
c) the medical supervision which may be exercised by certifying surgeons;
d) the examination by inspectors or other persons of the supply and
distribution of drinking water in plantations;
e) appeals from any order of the chief inspector or inspector and the form in
which, the time within which and the authorities to which, such appeals
may be preferred;
f) the time within which housing, recreational, educational or other facilities
required by this Act to be provided and maintained may be so provided;
g) the types of latrines and urinals that should be maintained in plantations;
h) the medical recreational and educational facilities that should be provided in
plantations;
i) the from and manner in which notices of period or work shall be displayed
and maintained.
j) the registers which should be maintained by employers and the returns,
whether occasional or periodical, as in the opinion of the state Government
may be required for the purposes of this Act; and
k) the hours of work for a normal working day for the purpose of wages and the
overtime.
3) All rules made under this Act, shall if made by any Government, other than the
Central Government, be subject to the previous approval of the Central Government.
PLANTATION LABOUR ACT AMENDMENTS 2010
THE PLANTATIONS LABOUR (AMENDMENT) ACT, 2010 NO. 17 OF 2010
(18th May, 2010). An Act further to amend the Plantation Labour Act, 1951. Be it
enacted by Parliament in the Sixty-first Year of the Republic of India as follows:
1. Short tiele and commencement. - (1) This Act may be called the Plantations
Labour (Amendment) Act, 2010. (2) it shall come into force on such date as the
Central Government may, by notification in the Official Gazette, appoint, and
different dates may be appointed for different provisions of this Act and for different
States and any reference in any such provision to the commencement of this Act
shall, in relation to any State, be construed as a reference to the coming into force
of that provision in that State.
Amendment of section 2. - In section 2 of the Plantations Labour Act, 1951
(hereinafter referred to as the principal act), -(a) in clause (e), the following
Explanation shall be inserted, namely:- ‘Explanation.-For the purposes of this
clause, “the person who has the ultimate control over the affairs of the plantation”
means in the case of a plantation owned or controlled by - (i) a company, firm or
other association of individual; (2) in particular, and without prejudice to the
generality of the foregoing power, such rules may provide for all or any of the
following matters, namely:- (a) the restriction on employment of women and
148
adolescents for handling hazardous chemicals under sub-section (2) of section 18A;
(b) the qualifications of supervisor appointed under sub-section (3) of section 18A;
(c) the matters for training of workers under sub-section (4) section 18A; (d) the
medical examination of workers under sub-section (5) of section 18A; (e) the
facilities and equipments to be provided to the workers engaged in handling
insecticides, chemicals and toxic substances under sub-section (7) of section 18A;
(f) the precautionary notices to be exhibited under sub-section (9) of section
18A.”.(ii) the Central Government or State Government or State Government or any
local authority, the person or persons appointed to manage the “and includes,
where the worker is a male, his parents dependent upon him”, the words” and
includes parents and widow sister, dependent upon him or her” shall be
substituted; (c) inc clause 9k),-(i) in the opening portion, after the words” manual or
clerical”, the words “and includes a person employed on contract for more than
sixty days in a year” shall be inserted; (ii) in sub-clause (ii), for the words “rupees
seven hundred and fifty”, the words “rupees ten thousand” shall be substituted; (iii)
insub-clause (iii), for the words “managerial capacity, notwithstanding that his
monthly wages do not exceed rupees seven hundred and fifty”, the words
“managerial or administrative capacity, notwithstanding that his monthly wages do
not exceed rupees ten thousand” shall be substituted.
Amendment of section 7. - In section 7 of the principal Act, in sub-section (2),
in clause (b), for the words “and children are, or are to be”, the word “are” shall be
substituted.
Amendment of section 10. - In section 10 of the principal Act, in sub-section
(2), for the words “chief inspector”, the words “State Government upon a request by
the chief inspector” shall be substituted.
Insertion of new Chapter IVA. - After Chapter IV of the principal Act, the
following Chapter shall be inserted, namely:-
CHAPTER-IV A PROVISIONS AS TO SAFETY 18A. Safety. - (1) In every
plantation, effective arrangements shall be made by the employer to provide for the
safety of workers in connection with the use, handling, storage and transport of
insecticides, chemicals and toxic substances. (2) The State Government may make
rules for prohibiting or, restricting employment of women or adolescents in using or
handling hazardous chemicals. (3) The employer shall; appoint persons possessing
the prescribed qualifications to supervise the use, handling, storage and
transportation of insecticides, chemicals and toxic substances in his plantation. (4)
Every employer shall ensure that every worker in plantation employed for handling,
mixing, blending and applying insecticides, chemicals and toxic substances, is
trained about the hazards involved in different operations in which he is engaged,
the various safety measures and safe work practices to be adopted in emergencies
arising from spillage of such insecticides chemicals and toxic substances and such
other matters as may be prescribed by the State Government. (5) Every worker who
is exposed to insecticides, chemicals and toxic substances shall be medically
149
examined periodically, in such manner as may be prescribed, by the State

Government. (6) Every employer shall maintain health record of every worker who is
exposed to insecticide, chemicals and toxic substances which are used, handled,
stored or transported in a plantation, and every such worker shall have access to
such record. (7) Every employer shall provide-(a) washing, bathing and clock room
facilities; and (b) protective clothing and equipment, to every worker engaged in
handling insecticides, chemicals or toxic substances in such manner as may be
prescribed by the State Government. (8) Every employer shall display in the
plantation a list of permissible concentrations of insecticides, chemicals and toxic
substances in the breathing zone of the workers engaged in the handling and
application of such insecticides, chemicals and toxic substances. (9) Every
employer shall exhibit such precautionary notices as may be prescribed by the
State Government indicating the hazards of insecticides, chemicals and toxic
substances. 18B. Power of State Government to make rules. - (1) The State
Government may, by notification in the Official Gazette, make rules to carry out the
purposes of this Chapter. (2) In particular, and without prejudice to the generality
of the foregoing power, such rules may provide for all or any of the following
matters, namely:- (a) the restriction on employment of women and adolescents for
handling hazardous chemicals under sub-section (2) of section 18A; (b) the
qualifications of supervisor appointed under sub-section (3) of section 18A; (c) the
matter for training of workers under sub-section (4) of section 18A; (d) the medical
examination of workers under sub-section (5) of section 18A; (e) the facilities and
equipments to be provided to the workers engaged in handling insecticides,
chemicals and toxic substances under sub-section (7) of section 18A; (f) the
precautionary notices to be exhibited under sub-section (9) of section 18A.”.
Amendment of section 19. - In section 19 of the principal Act, in sub-section
(1), the words “or child” shall be omitted.
Insertion of new section 24. - After section 23 of the principal Act, the following
section shall be inserted, namely:- “24. Prohibition of employment of Children. - No
child shall be employed to work in any plantation.”
Amendment of section 25. - In section 25 of the principal Act,,-(a) the words
“or child” shall be omitted; (b) in the marginal heading, the words “and children”
shall be omitted.
Amendment of section 26 - In section 26 of the principal Act, -(a) in the
opening portion, the words “child and no” shall be omitted; (b) in clause (b), the
words “child or” shall be omitted.
Amendment of section 27 - In section 27 of the principal Act, in sub-section
(1), the words “either as child or” shall be omitted.
Insertion of new section 32C. - After section 32b of the principal Act, the
following section shall be inserted, namely:-“32C. Compensation. - The employer
shall give compensation to a worker in plantation in case of accident and
memorandum relating to such compensation shall be got registered by the
150
employer with the Commissioner in accordance with the provisions of the

Workmen’s Compensation Act, 1923.
Amendment of sections 33, 35 and 36. - In sections 33, 35 and 36 of the
principal Act, for the words “three months, or with fine which may extend to five
hundred rupees, or with both”, wherever they occur, the words “six months, or with
fine which may extend to ten thousand rupees, or with both” shall be substituted.
Amendment of section 34. - In section 34 of the principal Act, for the words
“one month, or with fine which may extend to fifty rupees, or with both, “the words
“two months, or with fine which may extend to one thousand rupees, or with both”
shall be substituted.
Amendment of section 37. - In section 37 of the principal Act, for the words
“six months, or with fine which may extend to one thousand rupees, or with both”,
the words “one year, or with fine which shall not be less than ten thousand rupees
but which may extend to one lakh rupees, or with both” shall be substituted.
It comes into force on such date as the Central Govt. may by notification in
official Gazette appoint. The Chief Inspector appointed by State Govt. shall be
deemed to be public servant. He can make examination and enquiry as the thinks
fit inorder to ascertain whether the provisions of this Act and of the Rules are being
observed. The various provisions as to health include drinking water, conservancy,
latrines & urinals, medical facilities. The Welfare provisions of this Act include
centers, crèches, recreation facilities, educational facilities, housing facilities.
1. Discuss the powers and duties of inspectors appointed under this Act.
2. Elaborate on weekly holidays provided to employees under this Act.
3. Discuss the penalties and procedure covered under the Act.
19.6 SUMMARY
This Act provides creches, canteen, recreational facilities, educational facilities,
housing facilities.
The Act provides weekly hours of work, weekly holidays. This act provides
certificate of fitness to be provided to work in plantations. This Act cover Various
types of leaves with wages, Annual leave with wages, wage during leave period
sickness and maternity benefits.
This Act covers contravention of provisions regarding employment of labour,
enhanced penalty after previous contravention. The various miscellaneous
provisions include power to give directions, power to exempt etc.
1. Discuss the enhanced penalty after previous conviction.
2. Discuss the provision to health with special reference to conservancy.
3. Discuss the provision to welfare with special reference to powers to make
rules related to housing.
151

1. P.Saravanavel, Labour legislation Eswar Press, Chennai.
2. T.N.Chhabra, R.K.Suri, Industrial Relations concepts & issues, Dhanpat Rai
& Co., Pvt. Ltd., New Delhi.
3. British India Co-operation Ltd. Vs. the Employees A.I.R., 1957.
4. Chipping & Painting Employers Association Pvt. Ltd., Vs S.T.Zambra AIR
(1969) Bombay 274.
19.9 ASSIGNMENTS
1. Compare and Contract the Plantation Labour Act of Govt. of India and with
Govt. of Srilanka.
1. B.D.Singh, Industrial Relations Emerging Paradigms, Excel Books 2004.
2. John Bernardin, Human Resource Management, An experimental approach,
TATA McGraw Hill Publishing Company Ltd.
3. Agarwal, Rashmi (2201): Labour Laws and Contemporary Issues, Manpower
Journal.
1. Discuss the General Power to make rules.
2. Elaborate of penalties for obstructing the Inspector for discharging his
duties.
3. Discuss the provisions for night work for women and children.
19.12 KEY WORDS
1. Surgeon
2. Obstruction
3. Imprisonment
4. Contravention
5. Liability
6. Exempt

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LESSON - 20
INDIAN MERCHANT’S SHIPPING ACT

20.1 INTRODUCTION
The first merchant shipping Act was enacted in 1923. The Act which is in
existence today has 24 parts.
This Act contains provisions relating to establishment and composition of
National shipping board. This Act also deals with general administration,
appointment of Director General, Establishment of shipping offices etc. This Act
gives provision for civil liability for oil pollution damage, provision for prevention of
pollution and gives powers to central Govt. for prohibition as to discharge oil and
oily mixtures.
20.2 OBJECTIVES
After reading this chapter you will be able to understood
 Provisions relating to the establishment and composition of National
Shipping Board.
 General Administration
 Registration of Indian ship, seamen and apprentices, passenger ships.
 Provisions relating to safety, construction rules for ships.
 Provisions for mobile offshore drilling units.
20.3 CONTENTS
MERCHANT SHIPPING ACT, 1958
The first Indian Merchant Shipping Act was enacted in 1923, the provision of
which were in line with the U.K. Merchant Shipping Act, 1894. After independence,
taking care of new conditions and changes that have taken place in the Shipping
Industry, a comprehensive legislation passed by Indian Parliament in 1958 known
as Merchant Shipping Act, 1958. The Act has been constantly under revisions and
amendments to ratify the changes approved by the International Maritime
Organisation, through its conventions and protocols, to which India is a Member.
The Merchant Shipping Act as is existed today has 24 parts. The review
committee appointed by the Government of India, in 1991 under the Chairmanship
of DG(s) to study the provision of the Act in its entirety and give suggestions for
amendments taking into consideration the International convention which India
has ratified but not statutorily enacted, has suggested comprehensive amendments
to the Act including the amendment to the preamble of the Act. The basic provision
of Act given in various parts are as under:-
Part-I deals with the preliminary giving short title of the Act and date of
commencement, application of the Act and definitions of the terms used in the
Act. The definitions have been given for 66 terms. Besides certain terms have
been defined in their appropriate part where they have occurred specifically.
The review committee has suggested to delete the definition of the following
terns on the ground that some of the terms defined under section 3 of the Act
153
have abundant clarity as their meaning in other relevant part of Act. These are
clause 5 - country to which Load line convention applies, clause 6 - country to
which safety convention applies, clause 19 - Load line certificate, clause 20 -
load line convention, clause 26 - pilgrim, clause 27 - pilgrimage, clause 28 -
pilgrim ship, clause 37 - Safety Convention, Clause 38 - Safety Convention
Certificate, Clause 53 - valid International load line Certificate and Clause 54 -
valid safety convention certificate.
The review committee has suggested amendments of the definition of the following terms
Clause-1(a) Coasting ship, Clause 2 - Coasting trade of India, clause 3 - distressed
seaman, Clause 12 - Finishing vessel, Clause 16 - Home Trade Ship, Clause 23 -
Owner, Clause 29 - Portal of Registry, Clause 35 - Register, Clause 42 - Seamen,
Clause 45 - Ship, Clause 55 - Vessel and Clause 58 - Wreck.
The committee also suggested to add the definition of following terms in Selection 3.
Exclusive economic zone, Skipper, Storm, Tanker, Chemical Tanker and Gas
Carrier.
Part-II of the Act contains provisions relating to the establishment and composition of
National Shipping Board, its functions and powers of the Government to make
rules in this respect for term of office of members, appointment of officers or other
allowances of Board members.
Part-III deals with the General Administration, appointment of Director General,
establishment of Mercantile Marine Departments, Shipping Offices, Seaman’s
employment offices and Seamen’s Welfare Offices. It also deals with the
appointment of Principal Officers at MMD, Mumbai, Calcutta and Madras and
other officers at other ports, appointment of surveyors, radio inspectors, Shipping
Masters, Director of Seamen’s Employment Offices and Seamen’s Welfare Officers.
Part-IV:which dealt with the formation of Shipping Development Fund and
establishment of Shipping Development Fund Committee, has been abolished
vide M.S. (Amendment) Act 1986 (66 of 1986).
Part-V: deals with the registration of Indian ships, contains provisions for obligation to
register, procedure for registration, Grant of certificate of registry, endorsement
for change of Master and Owner, provision far transfer of ships shares etc., rules
as to name of ship, provisions for registry of alternations registry a new and
transfer of registry, national character of the ships and flag etc.
Part-VI: gives provisions relating to the certificates of officers - Masters, Mates,
Engineers, Skippers etc., and also requirements of officers on board various
category of ships. Review Committee has recommended that instead of specifying
the manning scale in the Act itself, Government should have rule making powers
to prescribe different meaning scale for different types of ships and also to carry a
safe meaning document on board the ship.
Part-VI:A contains provisions for obligation of certain certificate holder to serve
Government or in Indian ships.
154
Part-VII: deals with seamen and apprentices. It gives vide ranging provision for
classification of seamen, their engagements, discharge, payment of wages, their
right for wages dispute between seamen and employers, provisions for property of
deceased seamen and apprentices, distressed seamen, provisions for health and
accommodation, protection of seamen in case of litigation and other matters,
provision as to discipline, duties of Shipping Master, business of Seamen’s
employment offices and function of National Welfare Board for seafarers,
provisions for rule making powers imposition of the Board, term of office of
members, procedure for conduct of business, levy of fee for providing amenities to
seamen and procedure for collection and recovery of Levy fee.
Part-VIII: deals with passenger ships, their survey, Certificate of survey, power of
surveyor, fee, duration of survey, etc. It provides for keeping order in passenger
ships specifying certain acts of persons as an offence under the act. This part also
contains provision for special trade passenger ships and pilgrim ships.
Part-IX: of the Merchant Shipping Act 1958 deals with the provisions relating to Safety.
This part gives the provisions relating to construction rules for ships, prevention of
collisions, life saving appliances and fire appliances, installation of radio
telephony and direction finders, signaling lamp and provisions relating to stability
information. The part also deals with the provisions relating to Safety Certificates,
Safety equipment certificates, Safety radio telegraphy Certificates, exemption
certificates, etc., provision for determining load lines, issue of load line certificates
and special provisions as to ships other than Indian ships. This part also provides
powers to make rules as to timber cargo, carriage of dangerous goods, grain
loading plan and carriage of grain. The provisions also exists for sub division load
lines, unseaworthy Ships, definition of unsafe ships and liability for cost of
detention and powers to make rules to issue certificates under this part.
Part-IX: A Deals with Nuclear Ships which includes application or non application of
certain provision of this Act to Nuclear ships, issue of Nuclear passenger and
Nuclear Cargo Ship Safety Certificate and powers to make rules in this respect.
The review committee has suggested for inclusion of one more part - Part IX B to cover
provisions for mobile offshore Drilling units - section 344 J to 344 Z. (proposed).
Part-X: This part deals with the collision, accident at sea and liability which includes
provision for division of loss in case of collision, damages for personal injury etc.
Part-X: A - gives provision for limitation of liability of owners in case of certain damages.
Part-X: B - gives provision for civil liability for oil pollution damage. It embodies
provisions for limitation of liability of the owner, constitution of limitation fund,
consolidation of claims & distribution of fund amongst claimants, provision for
compulsory insurance or other financial guarantee and rule making powers.
The review committee has suggested include part X C to give provision of International
Oil Pollution fund Convention 1971 and its protocol.
155
Part-XI: This part gives provision for regular method of giving helm orders, duty of
master to report danger to navigation, manner of communicating report of danger
to navigations, obligation to render assistance to persons and ships in danger,
etc. This part is also under amendments in accordance with the recommendation
given by the review committee to include foreign flag vessels under preview, giving
information by Indian ships about position, course, speed to maritime
administration and provision for Indian ships to be fitted with prescribed
navigational aids and equipments.
Part XI A - Prevention and containment of pollution of sea by Oil:
This part contains provision for prevention of pollution and gives powers to
Central Government for prohibition as to discharge of oil and oily mixtures,
inspection and control of ships to which Oil Pollution Convention applies,
maintenance or Oil record book, oil reception facilities at the ports in India and
powers of the Government to take measures for preventing or containing oil
pollution, direction to certain ships to render assistance and levy of oil pollution
cess. Rules can also be framed by the Government under the provision of this part.
This part does not contain provision for the action to be taken when oil is
escaped. The review Committee has recommended to empower the Central
Government to take appropriate action when oil is escaped.
Part-XII: This part provides the provision for investigation and inquiries in shipping
casualties. It gives powers to the Court for holding formal investigations, to arrest
witnesses or enter the ships, to commit trails, to censure masters, mates or
engineer, or to remove master. A marine board can be appointed by counselor
officer if the casualty occurs at foreign waters. Central Government can cancel or
suspend certificate of Master, Mate or Engineer, Constitution of court of survey,
reference in difficult cases to scientific persons and investigation into explosions
or fire on board of ship are the other provisions of this part.
The review committee has suggested to constitute a formal board of investigation
headed by a judge of giving the matters to the court, as is assumed that the court
take too much of time in coming to a conclusion.
Part-XIII: This part gives provision for matters relating to wreck and salvage. India has
ratified 1989 Salvage Convention and therefore review committee has suggested
that provisions of this Convention may be instead amending Section 390, 398,
402 (1) and 404.
Part-XIV: of the Act gives powers to the Central Govt. for control of Indian ships and ships
engaged in coasting trade. Section 412 giving powers to fix shipping rates has already
been abolished. Some relaxation have also been given under cabotage law.
Part-XV: contains the provisions for sailing vessels and part XVA for fishing boats,
their registry, name, inspection, certification etc.
Part-XVI: gives the provisions for penalties for violation of the provisions of the Act and
procedure thereof.
156
Part-XVII: contains miscellaneous provisions for appointing examiners, powers of ship

surveyor, inquiry into case of death on board the ships etc.
The merchant shipping Act as it existed today has 24 parts. This Act
contains provisions relating to establishment and composition of National Shipping
Board. This Act contains provision for obligation of certain certificate holders. This
Act also deals with the provisions relating to safety. This Act gives provision for
limitation of ............... of owners, provision for prevention of pollution. This Act
provides provision for matters relating to wreck and salvage.
1. Discuss the Part XI and XI A of this Act?
2. Discuss the Part VI, VI A of this Act.
3. Elaborate on Part VII of this Act.
20.6 SUMMARY
 Part I - deals with preliminary giving short little of Act.
 Part II - deals with provisions relating to the establishment & composition of
National shipping board.
 Part - III deals with General Administration,
 Part - IV deals with the formation of shipping development fund.
 Part - V deals with registration of Indian Ships
 Part - VI deals with certificate of officers
 Part - VII deals with seamen and apprentices.
 Part - VIII deals with passenger ships, their survey
 Part - IX deals with provisions relating to safety.
1. Elaborate on the provisions relating to safety under the Act.
2. Discuss the provisions for prevention of pollution, prohibition to discharge of
oil and only mixtures.
3. Elaborate on the provision for investigation and inquiries in shipping
casualties.
1. Firestone Tyre and Rubber Co. Vs Its workman (1976).
2. P.Industries Vs The Worker Men AIR, 1952
3. Industrial Relations Labour Welfare and Labour Laws.
4. www.slideshare.net
20.9 ASSIGNMENTS
1. Compare the merchant shipping Act of India with other prominent countries
of Asia?
2. Discuss the powers of ship surveyor?
157

1. Basu.K., S.Bhattacharya and A.Mishra Journal of Public Economics.
2. Mookheriged and I.P.L. Png (1995), The Economic Journal.
3. Deshpande L.et al, 2004, Liberalization and Labour Flexibility in Indian
Manufacturing Institute for human Development, New Delhi.
1. Discuss the provisions for sailing vessels?
2. What are the penalties for violation of provisions of the Act?
3. Discuss the provision for investigation and Inquires in shipping casualties.
20.12 KEY WORDS
1. Oil Pollution
2. Convention
3. Home Trade ship
4. Wreck
5. Skippers
6. Navigations

158
LESSON - 21
LAWS ON SOCIAL SECURITY

21.1 INTRODUCTION
Social Security protects not just the subscriber but also his / her entire family
by giving. Benefit packages in financial security and health care. The India of social
security is that the state shall make itself responsible for ensuring a minimum
standard of material welfare to all its citizens on a basis wide enough to cover all
the contingencies of life.
People with limited means of living can hardly provide effective security against
the contingencies like sickness, maternity, invalidity, employment injuries,
unemployment, old age, death and other emergency expenses.
21.2 OBJECTIVES
After reading this chapter you should be able to understand
 The definitions, features of social security.
 Elements covered under social security.
 Aims and coverage of social security measures.
 International labour organization and social security.
21.3 CONTENTS
“Social security as a programme of protection provided by the society against
the contingencies of modern; life such as sickness, unemployment, old age
dependency accidents and invalidism against which the individual cannot be
expected to protect himself and his family by his own ability or foresight”
-Freindlander, Walter A.
“Social security is the endeavor of the community, as whole to afford itself to
the utmost extent possible to any individual during periods of physical distress
inevitable on illness or injury and from the economic distress consequent reduction
or loss of earnings due to illness, disablement, maternity, unemployment, old age or
death of the working member”
-Ibid
Social Security Features
1) The benefits or services are provided in three major wages; social insurance,
social assistance and public service.
2) They are established by law.
3) They provide some form cash payment to individuals to replace at least a
part of the lost income that occurs due to such contingencies as
unemployment, work injury, invalidism, maternity, old age, sickness and
death.
Elements Covered Under Social Security
These include:
1) Payment of funeral expenses
159
2) Medical care in times of illness

3) Pension in old age ager retirement
4) Allowance during the period of unemployment, etc.
5) Maternity facilities and cash allowance before and after the birth of the child
in case of female.
6) Pension during invalidity.
Aims of Social Security
The aims of social security are
a) Prevention
b) Restoration
c) Compensation
a) Prevention Is designed to avoid the loss of productivity capacity due to
sickness, unemployment or invalidity and to render the available resources
which are used up by avoidable disease and idleness and thus increases the
material, intellectual and moral well being of the community.
b) Restoration Implies cure of the sick and the invalid, re-employment and
rehabilitation, and is in some ways, an extension of the earlier concepts of the
functions of social security.
c) Compensation Goes to income security and is based upon the idea that
during risks, the individual and his family should not be subjected to a double
calamity involving both destination and loss health, limb, or work.
Coverage of social security measures
Social security covers a wide range of activities while in most of the countries,
all governmental programs planned to maintain income are called social security
programmes.
There are two main currents in the movement towards social security, viz,
(a) Social assistance
(b) Social Insurance
These two differ in their revolutionary process and approach. They have been
designed to serve the same ends, and both are complimentary and supplementary
to each other. They are two sides of the same coin and form an integral part of the
social security system of a country.
a) Social Insurance
Is the method to help individuals in times of contingencies through group
efforts. Social Insurance is a co-operative device which aims at granting adequate
benefits to the workers on a compulsory basis, in times of unemployment, sickness
and other emergencies, with a view to ensure a minimum standard of living, out of
a fund created by the contribution of the workers, employers and the state. William
Beverage described social insurance as the giving in return of contribution, benefits
up to a subsistence level, as of right and without means test.
160
Social insurance is a collective or co-operative method of protecting individuals

against the chief risks of life. It is based on the premise that although accidents of
life are incalculable in regard to individuals, they may be foreseen and measured
with a fair degree of exactitude in relation to groups of individuals where they occur
with remarkable regularity. This possibility of foretelling events with regard to
groups enables the risks to which individuals are exposed to be spread over a large
number of persons. The term is, however, restricted in its application to schemes
designed to protect working classes against various industrial hazards. It is based
on compulsory mutual aid and may be traced back to family relationship under the
institution of joint family. It has been the growth of individualism and influence of
modern civilization, introduction of factory system and transport revolution that led
towards disintegration of joint family system and thereby giving birth to the
problem of economic security to be served by the mutual benefit societies of
workers which were formed with the purpose of helping one another in misfortunes.
Social insurance scheme needs to be based on a wide knowledge of social
pathology and a study of causes and effects of common industrial risks, for the
incident and severity of risks vary from country to country, depending on a number
of factors like age, income, having employment and labour conditions is general.
But, it does not mean that there is actuarial relationship between contribution and
benefit conferred by insurance under social insurance scheme. Being quite distinct
from commercial insurance where benefits based on the actual studies, social
insurance involves payment of certain benefits to the person insured without any
consideration of his contributions to the fund set up. No mathematical relationship
between benefit and contribution is maintained under social insurance which does
not envisage and distinction between good risk and bad risk.
b) Social Assistance / Public Assistance
Social or national assistance may be defined as “a device to provide benefits
conditional upon provided needs at the time of claim, irrespective of previous
contributions, but adjusted in each case, and paid out of the national exchequer”. It
represents the “unilateral obligation of the community towards its dependent groups”.
While benefits under social insurance are granted as a matter of right and without any
means test, social assistance is made available to those who fulfill certain prescribed
conditions. It is provision of certain relief by the state or local bodies to those who are
in need of it to meet certain contingencies under ‘special cases’.
The term public or social service includes benefits in cash as well as the
provision of actual services to certain groups of people who are assumed to need
this. No previous contribution is required here as well. It may be noted here that
provision of medical care and children allowances may be notable instances of
social services. It is a major aspect of public policy and the extent of its prevalence
is a measure of the progress made by a country towards the ideal of a welfare state.
Public services of assistance are usually financed directly by the government
from it general revenue in the form of cash payments or services to every individual
161
of the community falling with in a defined category. The examples of social

assistance of public service programmes are medical and health services of
government, old age pensions, unemployment allowances, etc.
International Labour Organization & Social Security
In 1944, ILO stated that poverty anywhere constitutes a danger to prosperity
everywhere. On December 10, 1948, the General Assembly of the United Nations
adopted and proclaimed the universal declaration of Human Rights as common
standard of achievement for all nations. The declaration says that:
“Every one has the rights to a standard of living, adequate for the health and
well being of himself and of his family including food, clothing, housing, and
medical care and the right to security in the event of unemployment, sickness,
disability, widowhood, old age or other lack of livelihood in circumstances beyond
his control”.
In order to implement these measures, the I.L.O. took the following steps:
1) It collected and spread the information about social security schemes in
various countries.
2) It provides technical assistance and guidance so that social security
schemes may be properly formulated by means of co-operation with other
social organizations.
3) It tried to create international standards by way of recommendations
regarding the definitions of social security.
In 1952, ILO convention on social security minimum standard divided social
security into nine components.
a) Sickness benefit
b) Maternity benefit
c) Survivor’s benefit
d) Family benefit
e) Medical care benefit
f) Unemployment benefit
g) Employment injury benefit
h) Old age benefit
i) Individualism benefit
a) Sickness benefit
This should cover incapacity to work due to a morbid condition in a loss of
earnings. This calls for periodical payment based on the convention specification.
The worker need not be paid for the first three days of suspension of earnings and
the payment of benefit may be limited to 26 weeks in a year.
b) Maternity benefit
The benefit should cover pregnancy, confinement and their consequences
resulting in the suspension of earnings. Provision should be made to provide
medical care, including prenatal confinement, postnatal care and also
162
hospitalization, if necessary. Periodical payment limited to 12 weeks should be

made during the period of suspension of earnings.
c) Survivor’s benefit
This should cover periodical payments made to family following the death of its
breadwinner and should continue during the entire period of contingency.
d) Family benefit
This should cover responsibility for the maintenance of children during the
entire period of a contingency. Periodical payment, provision of food, housing,
clothing, holidays or domestic help in respect of children should be provided to a
needy family.
e) Medical care
This should cover pregnancy, confinement and its consequences and any
disease which may lead to a morbid condition. The need for prenatal and postnatal
care, in addition to hospitalization, was emphasized. A morbid condition may
require general practitioner care, specialist care, provisions of essential
pharmaceutical and hospitalization.
f) Unemployment benefit
This should covet the loss of earnings during a worker’s unemployment period
when he is capable and available for work but remains unemployed because of lack
suitable employment. This benefit may be limited to 13 weeks’ payment in a year,
excluding the first seven days of waiting period.
g) Employment injury benefit
This should cover the following contingencies resulting from accident or
disease during or from employment:
 Morbid condition
 Total or partial loss of earning capacity which may become permanent.
 Inability to work.
 Death of the breadwinner in the family, as a result of which the family is
deprived of financial support. Medical care and periodical payment
corresponding to an individual’s need should be available.
h) Old age benefit
The benefit provides for payment of the quantum depending upon an
individual’s working capacity during the period before retirement of a certain
beyond a prescribed age and continues till death.
i) Individualism benefit
This benefit in the form of periodical payments, should cover the needs of
workers who suffer from any disability arising out of sickness or accident and who
are unable to engage in any gainful activity. This benefit should continue till
invalidism change into old age, when old age benefits would become payable.
163

The elements covered under social security are payment of funeral expenses,
medical care in times of illness, pension in old age after retirement, allowance
during the period of unemployment, maternity facilities and cash allowances and
pension during invalidity. The aims of social security are prevention, restoration
and compensation.
The two main currents in the movement towards social security are social
assistance and social insurance. The social security is divided into nine
components namely sicken, male......, survivor, family, medical care,
unemployment, employment injury, old age and individualism benefit.
1. Write down the nature and characteristics of social security?
2. Explain ILO and social security.
3. What do you understand by social security?
21.6 SUMMARY
Social security schemes are designed to guarantee at least long term
sustenance to families when the earning members retires to families when the
earning members retires dies or suffers as disability. Thus the main strength of
social security system is that is acts as a facilitator. The success of social security
system requires active support and involvement of employees and employers. Social
security in India is need based. In Indian context social security is a comprehensive
approach designed to prevent deprivation, assure the individual of a basic
minimum income for himself and his dependents and to protect the individual from
any other uncertainties.
1. Discuss social security and legal aspects.
2. Discuss social security and its impact in industrial relations?
3. Discuss “social security in India is need based”.
1. William B. Werther and Keeth Davis “Human Resource and Personnel
Management, McGraw - Hill.
2. Business Today, Fourth Anniversary Issue Jan. 1997.
3. Ibid, P.426
21.9 ASSIGNMENTS
1. Is social security a comprehensive approach towards protection of individual”
Discuss.
2. Social security and development are co-related to one another elaborate.
3. In era of globalization, social security has increased importance. Discuss.
1. Gankar “Industrial relations in India, Himalaya publishing house.
2. Industrial relations, Labour welfare and labour laws - B.Nandhakumar
164

1. Discuss the social insurance in light of various social security.
2. Discuss public assistance?
21.12 KEY WORDS
1. Allowances
2. Compensation
3. Retirement
4. Restoration
5. Social assistance
6. Social insurance
7. Unemployment
8. Pension.

165
UNIT-VI
LESSON - 22
WORKERS COMPENSATION ACT - 1923

22.1 INTRODUCTION
It is one of the earliest labour welfare & social security legislation enacted in
India. This Act does not apply to those workers who are insured under the
employees State Insurance Act 1948. This Act is applicable all over India. This Act
provides for payment of compensation to workmen and their dependants in case of
injury and accident arising out of and in the course of employment and resulting in
disablement or death.
22.2 OBJECTIVES
After reading this chapter, you should able to:
 Understand the objects reasons and definitions of workman’s compensation
Act.
 Know the workmen’s compensation
 Know the duties and responsibilities of commissioners.
 Know the penalties for certain offences in this Act.
22.3. CONTENTS
1. Short title, extent and commencement
1. This Act may be called THE WORKMEN’S COMPENSATION ACT, 1923.
2. It extends to the whole of India.
3. It shall come into force on the first day of July, 1924.
2. Definitions
a) In this Act, unless there is anything repugnant in the subject or context,-
b) “Commissioner” means a Commissioner for workmen’s Compensation
appointed under section 20;
c) “Compensation” means compensation as provided for by this Act;
d) “Dependant” means any of the following relatives of a deceased workman,
namely:-
i. A window, a minor legitimate or adopted son, an unmarried legitimate or
adopted daughter, or a widowed mother; and
ii. If wholly dependent on the earnings of the workman at the time of death,
a son or a daughter who has attained the age of 18 years and who is
infirm;
iii. If wholly or in part dependant on the earnings of the workman at the
time of his death,-
a) A widower,
b) A parent other than a widowed mother,
166
c) A minor illegitimate son, an unmarried illegitimate daughter or a

daughter legitimate or illegitimate or adopted if married and a minor
or if windowed and a minor,
d) A minor brother or an unmarried sister of a widowed sister if a minor,
e) A widowed daughter-in-law,
f) A minor child of a pre-deceased son,
g) A minor child of a pre-deceased daughter where no parent of the child
is alive, or
h) A paternal grandparent if no parent of the workman is alive.
e) “Employer” includes anybody of persons whether incorporated or not and
any managing agent of an employer and the legal representative of a
deceased employer, and, when the services of a workman are temporarily
lent or let on hire to another person by the person with whom the workman
has entered into a contract of service or apprenticeship, means such other
person while the workman is working for him;
f) “Managing agent” means 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;
g) “Minor” means a person who has not attained the age of 18 years;
h) “Partial disablement” means, where the disablement is a temporary nature,
such disablement as reduces the earning capacity of a workman in any
employment in which he was engaged at time of the accident resulting in the
disablement, and, where the disablement is of a permanent nature, such
disablement as reduces his earning capacity in every employment which he
was capable of undertaking at the time: provided that every injury specified
in Part II of Schedule I shall be deemed to result in permanent partial
disablement;
i) “Prescribed” means prescribed by rules made this Act;
j) “Qualified medical practitioner” means any person registered [***] under any
Central Act, Provincial Act or an Act of the Legislature of a State providing
for the maintenance of a register of medical practitioners, or, in any area
where no such last-mentioned Act is in force, any person declared by the
State Government, by notification in the Official Gazette, to be a qualified
medical practitioner for the purposes of this Act;
k) “Seaman” means any person forming part of the crew of any [***] ship, but
does not include the master of the ship; “total disablement” means such
disablement, whether of a temporary or permanent nature, as incapacitates
a workman for all work which he was capable of performing at the time of
the accident resulting in such disablement:
l) Provided that permanent total disablement shall be deemed to result from
every injury specified in Part I of Schedule I or from any combination of
167
injuries specified in Part II thereof where the aggregate percentage of the loss
earning capacity, as specified in Part II against those injuries, amounts to
one hundred per cent. or more;
m) “Wages” includes any privilege or benefit which is capable of being estimated
in money, other than travelling allowance or the value of any travelling
concession or a contribution paid by the employer of a workman towards
any pension or provident fund or a sum paid to a workman to cover any
special expenses entailed on him by the nature of his employment;
n) “Workman” means any persons who is__(i) a railway servant as defined in
clause (34) of section 2 of the Railways Act, 1989 (24 of 1989), not
permanently employed in any administrative, district or sub-divisional office
of a railway and not employed in any such capacity as is specified in
Schedule II, or
a) A master, seaman or other member of the crew of a ship,
b) A captain or other member of the crew of an aircraft,
c) A person recruited as driver, helper, mechanic, cleaner or in any other
capacity in connection with a motor vehicle,
d) A person recruited for work abroad by a company, and who is employed
outside India in any such capacity as is specified in Schedule II and the
ship, aircraft of motor vehicle, or company, as the case may be, is
registered in India, or
1) Employed in any such capacity as is specified in Schedule II, whether the
contract of employment was made before or after the passing of this Act
and whether such contract is expressed or implied, oral or in writing; but
does not include any person working in the capacity of a member of the
Armed Forces of the Union; and any reference to a workman who has
been injured shall, where to workman is dead, include a reference to his
dependants or any of them.
2) The exercise and performance of the powers and duties of a local
authority or of any department acting on behalf of the Government shall,
for the purposes of this Act, unless contrary intention appears, be
deemed to be the trade or business of such authority or department.
3) The Central Government or the State Government, by notification in the
Official Gazette, after giving not less than three months’ notice of its
intention so to do, may, by a like notification, add to Schedule II any
class of persons employed in any occupation which it is satisfied is a
hazardous occupation, and the provisions of this Act shall thereupon
apply, in case of a notification by the Central Government, within the
territories to which the Act extends, or, in the case of a notification by
the State Government, within the State, to such classes of persons:
Provided that in making addition, the Central Government or the State
Government or the State Government, as the case may be, may direct that the
168
provisions of this Act shall apply to such classes of persons in respect of specified
injuries only.
WORKMEN’S COMPENSATION
Employer’s liability for compensation
1. If personal injury is caused to a workman by accident arising out of and in the
course of his employment, his employer shall be liable to pay compensation in
accordance with the provisions of this Chapter:
Provided that the employer shall not be so liable-
a) In respect of any injury which does not result I the total or partial
disablement of the workman for a period exceeding three days;
b) In respect of any injury, not resulting in death or permanent total
disablement, caused by an accident which is directly attributable to-
i) The workman having been at the time thereof under the influence of drink or
drugs, or
ii) The willful disobedience of the workman to an order expressly given, or to a
rule expressly framed, for the purpose of securing the safety of workmen, or
iii) The willful removal or disregard by the workman of any safety guard or other
device which he knew to have been provided for the purpose of securing the
safety of workmen.
2. If a workman employed in any employment specified in Part A of Schedule III
contracts any disease specified therein as an occupational disease peculiar to
that employment, or if a workman, whilst in the service of an employer in whose
service he has been employed for a continuous period of not less than six
months (which period shall not include a period of service under any other
employer in the same kind of employment) in any employment specified in Part
B of Schedule III, contracts any disease specified therein as an occupational
disease peculiar to that employment, or if a workman whilst in the service of
one or more employers in any employment specified in Part C of Schedule III for
such continuous period as the Central Government may specify in respect of
each such employment, contracts any disease specified therein as an
occupational disease peculiar to that employment, the contracting of the disease
shall be deemed to be an injury by accident within the meaning of this section
and, unless the contrary is proved, the accident, shall be deemed to have arisen
out of, and in the course of, the employment:
3. Nothing herein contained shall be deemed to confer any right to compensation on
a workman in respect of any injury if he has instituted in a Civil Court a suit for
damages in respect of the injury against the employer or any other person; and
no suit for damages shall be maintainable by a workman in any Court of law in
respect of any injury-
i) if he has instituted a claim to compensation in respect of the injury
before a Commissioner; or
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ii) if an agreement has been come to between the workman and his
employer providing for the payment of compensation in respect of the
injury in accordance with the provisions of this Act.
Amount of compensation
1.Subject to the provisions of this Act, the amount of compensation shall be as
follows, namely:-
Where death results from the injury an amount equal to fifty per cent of monthly
wages of the deceased workman multiplied by
the relevant factor;
or
an amount of eighty thousand rupees,
whichever is more;
Where permanent total disablement an amount of sixty per cent of the monthly
results from the injury wages of the injured workman multiplied by
the relevant factor,
or
an amount of ninety thousand rupees,
whichever is more
2. The half-monthly payment referred to in clause (d) of sub-section (1) shall be
payable on the sixteenth day-
i) from the date of disablement where such disablement lasts for a period of
twenty-eight days or more, or
ii) after the expiry of a waiting period of three days from the date of
disablement where such disablement lasts for a period of less than twenty-
eight days; and thereafter half-monthly during the disablement or during a
period of five years, whichever period is shorter:
Provided that-
a) There shall be deducted from any lump sum or half-monthly payments to
which the workman is entitled the amount of any payment or allowance
which the workman has received from the employer by way of compensation
during the period of disablement prior to the receipt of such lump sum or of
the first half-monthly payment, as the case may be; and
b) No half-monthly payments shall in any case exceed the amount, if any, by
which half the amount of the monthly wages of the workman before the
accident exceeds half the amount of such wages which he is earning the
accident.
3. On the ceasing of disablement before the date of which any half-monthly
payment falls due, there shall be payable in respect of that half-month a sum
proportionate to the duration of the disablement in that half-month.
4. If the injury of the workman results in his death, the employer shall, in addition
to the compensation under sub-section (1), deposit with the Commissioner a
sum of two thousand and five hundred rupees for payment of the same to the
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eldest surviving dependant of the workman towards the expenditure of the

funeral of such workman or where the workman did not have a dependant or
was not living with his dependant at the time of his death to the person who
actually incurred such expenditure.
Method of calculating wages
In this Act and for the purposes thereof the expression “monthly wages” means
the amount of wages deemed to be payable for a month’s service (whether the
wages are payable by the month or by whatever other period or at piece rates) and
calculated as follows, namely:-
a) Where the workman has, during a continuous period of not less than twelve
months immediately proceeding the accident, been in the service of the
employer who is liable to pay compensation, the monthly wages of the
workman shall be one-twelfth of the total wages which have fallen due for
payment him by the employer in the last twelve months of that period;
b) Where the whole of the continuous period of service immediately preceding the
accident during which the workman was in the service of the employer who is
liable to pay the compensation was less than one month, the monthly wages of
the workman shall be the average monthly amount which, during the twelve
months immediately preceding the accident, was being earned by a workman
employed on the same work the same employer, or, if there was no workman
so employed, by a workman employed on similar work in the same locality;
c) in other cases including cases in which it is not possible for want of necessary
information to calculate the monthly wages under clause (b), the monthly
wages shall be thirty times the total wages earned in respect of the last
continuous period of service immediately proceeding the accident from the
employer who is liable to pay compensation, divided by the number of days
comprising such period.
Review
1. Any half-monthly payment payable under this Act, either under an agreement
between the parties or under the order of a Commissioner, may be reviewed by
the Commissioner, on the application either of the employer or of the
workman accompanied by the certificate of a qualified medical practitioner
that there has been a change in the condition of the workman or, subject to
rules made under this Act, on application made without such certificate.
2. Any half-monthly payment pay, on review under this section, subject to the
provisions of this Act, be continued, increased, decreased or ended, or, if the
accident is found to have resulted in permanent disablement, be converted to
the lump sum to which the workman is entitled less any amount which he has
already received by way of half-monthly payments.
Commutation of half-monthly payments
Any right to receive half-monthly payments may, by agreement between the
parties or, if the parties or, if the parties cannot agree and the payments have been
continued for not than six months, on the application of either party to the
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Commissioner, be redeemed by the payment of a lump sum of such amount as may

be agreed to by the parties or determined by the Commissioner, as the case may be.
Distribution of compensation
1. No payment of compensation in respect of a workman whose injury has
results in death, and no payment of a lump sum a compensation to a woman
or a person under a legal disability, shall be made otherwise than by deposit
with the Commissioner, and no such payment made directly by an employer
shall be deemed to be a payment of compensation:
Provided that, in the case of a deceased workman, an employer may make to
any dependant advances on account of compensation of an amount equal to
three months wages of such workman and so much of such amount as does
not exceed the compensation payable to that dependant shall be deducted by
the Commissioner from such compensation and repaid to the employer.
2. Any other sum accounting to no t less than ten rupees which is payable as
compensation may be deposited with the Commissioner on behalf of the
person entitled thereto.
3. The receipt of the Commissioner shall be a sufficient discharge in respect of
any compensation deposited with him.
4. On the deposit of any money under sub-section (1), as compensation in
respect of a deceased workman the Commissioner shall, if he thinks
necessary, cause notice to be published or to be served on each dependant in
such manner as he thinks fit, calling upon the dependants to appear before
him on such date as he may fix for determining the distribution of the
compensation. If the Commissioner is satisfied after any inquiry which he may
deem necessary, that no dependant exists, he shall repay the balance of the
money to the employer by whom it was paid. The Commissioner shall, on
application by the employer, furnish a statement showing in detail all
disbursements made.
5. Compensation deposited in respect of a deceased workman shall, subject to
any deduction made under sub-section (4), be apportioned among the
dependants of the deceased workman or any of them in such proportion as
the Commissioner thinks fit, or may, in the discretion of the Commissioner, be
allotted to any one dependant.
6. Where any compensation deposited with the Commissioner is payable to any
person, the Commissioner shall, if the person to whom the compensation is
payable is not a woman or a person under a legal disability, and may, in
others cases, pay the money to the person entitled thereto.
7. Where any lump sum deposited with the Commissioner is payable to a woman
or a person under a legal disability, such sum may be invested, applied or
otherwise dealt with for the benefit of the woman, or of such person during his
disability, in such manner as the Commissioner may direct; and where a half-
monthly payment is payable to any person under a legal disability, the
Commissioner may, of this own motion or on an application made to him this
behalf, order that the payment be made during the disability to any dependant
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of the workman or to any other person, whom the Commissioner thinks best
fitted to provide for the welfare of the workman.
8. Where, on application made to him in this behalf or otherwise, the
Commissioner is satisfied that, on account of neglect of children on the part of
a parent or an account of the variation of the circumstances of any dependant
or for any other sufficient cause, an order of the Commissioner as to the
distribution of any sum paid as compensation or as to the manner in which
any sum payable to any such dependant is to be invested, applied or
otherwise dealt with, ought to be varied, the Commissioner may make such
orders for the variation of the former order as the thinks just in the
circumstances of the case:
Provided that no such order prejudicial to any person shall be made unless
such person has been given an opportunity of showing cause why the order should
not be made, or shall be made in any case in which it would involve the repayment
by a dependant of any sum already paid to him.
Compensation not to be assigned, attached or charged
Save as provided by this Act, no lump sum or half-monthly payment payable
under this Act shall in any way be capable of being assigned or charged or be liable
to attachment or pass to any person other than the workman by operation of law,
nor shall any claim be set off against the same.
Notice and claim
1. No claim for compensation shall be entertained by a Commissioner unless
notice of the accident has been given in the manner hereinafter provided as
soon as practicable after the happening thereof and unless the claim is
preferred before him within two years of the occurrence of the accident or, in
case death, within two years from date of death:
Provided that, where the accident is the contracting of disease in respect of
which the provisions of sub-section (2) of section 3 are applicable, the accident
shall be deemed to have occurred on the first of the days during which the
workman was continuously absent from work in consequence of the
disablement caused by the disease:
Provided further that if a workman who, having been employed in an
employment for a continuous period, specified under sub-section (2) of section
3 in respect of that employment, ceases to be so employed and develops
symptoms of an occupational disease peculiar to that employment within two
years of the cessation of employment, the accident shall be deemed to have
occurred on the day on which the symptoms were first detected:
2. Every such notice shall give the name and address of the person injured and
shall state in ordinary language the cause of the injury and the date on which
the accident happened, and shall be served on the employer or upon any one
of several employers, or upon any person responsible to the employer for the
management of any branch of the trade or business in which the injured
workman was employed.
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3. The State Government may require that any prescribed class of employers
shall maintain at their premises at which workmen are employed a notice
book, in the prescribed form, which shall be readily accessible at all
reasonable times to any injured workman employed on the premises and to
any person acting bona fide on his behalf.
4. A notice under this section may be served by delivering it at, or sending it by
registered post addressed to, the residence or any office or place of business of
the person on whom it is to be served, or, where a notice book is maintained,
by entry in the notice book.
Medical examination
1. Where a workman has given notice of an accident, he shall, if the employer,
before the expiry of three days from the time at which service of the notice has
been effected, offers to have him examined free of charge by a qualified
medical practitioner, submit himself for such examination, and any workman
who is in receipt of a half-monthly payment under this Act shall, if so
required, submit himself for such examination from time to time:
2. Provided that a workman shall not be required to submit himself for
examination by a medical practitioner otherwise than in accordance with rules
made under this Act, or at more frequent intervals than may be prescribed.
3. If a workman, on being required to do so by the employer under sub-section
(1) or by the Commissioner at any time, refuses to submit himself for
examination by a qualified medical practitioner or in any way obstructs the
same, his right to compensation shall be suspended during the continuance of
such refusal or obstruction unless, in the case of refusal, he was prevented by
any sufficient cause from so submitting himself.
4. If a workman, before the expiry of the period within which he is liable under
sub-section (1) to be required to submit himself for medical examination,
voluntarily leaves without having been so examined the vicinity of the place in
which he was employed, his right to compensation shall be suspended until
he returns and offers himself for such examination.
5. here a workman, whose right to compensation has been suspended under
sub-section (2) or sub-section (3) dies without having submitted himself for
medical examination as required by either of those sub-sections, the
Commissioner may, if he thinks fit, direct the payment of compensation to the
dependants of the deceased workman.
6. Where under sub-section (2) or sub-section (3) right to compensation is
suspended, no compensation shall be payable in respect of the period of
suspension, and, if the period of suspension commences before the expiry of
the waiting period referred to in clause (d) of sub-section (1) of section 4, the
waiting period shall be increased by the period during which the suspension
continues.
7. Where an injured workman has refused to be attended by a qualified medical
practitioner whose services have been offered to him by the employer free of
charge or having accepted such offer had deliberately disregarded the
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instructions of such medical practitioner, then, if its proved that the workman
has not thereafter been regularly attended by a qualified medical practitioner
or having been so attended has deliberately failed to follow his instructions
and that such refusal, disregard or failure was unreasonable in the
circumstances of the case and that the injury has been aggravated thereby,
the injury and resulting disablement shall be deemed to be of the same nature
and duration as they might reasonably have been expected to be if the
workman had been regularly attended by a qualified medical practitioner,
whose instructions he had followed, and compensation, if any, shall be
payable accordingly.
Contracting
1. Where any person (hereinafter in this section referred to as the principal) in
the course of or for the purposes of his trade or business contracts with any
other person (hereinafter in this section referred to as the contractor) for the
execution by or under the contractor of the whole or any part of work which is
ordinarily part of the trade or business of the principal, of the principal shall
be liable to pay to any workman employed in the execution of the work any
compensation which he would have been liable to pay if that workman had
been immediately employed by him; and where compensation is claimed from
the principal, this Act shall apply as if references to the principal were
substituted for references to the employer except that the amount of
compensation shall be calculated with reference to the wages of the workman
under the employer by whom he is immediately employed.
2. Where the principal is liable to pay compensation under this section, he shall
be entitled to be indemnified by the contractor, or any other person from
whom the workman could have recovered compensation and where a
contractor who is himself a principal is liable to pay compensation or to
indemnify a principal under this section he shall be entitled to be indemnified
by any person standing to him in the relation of a contractor from whom the
workman could have recovered compensation, and all questions as to the right
to and the amount of any such indemnity shall, in default of agreement, be
settled by the Commissioner.
3. Nothing in this section shall be construed as preventing a workman from
recovering compensation from the contractor instead of the principal.
4. This section shall not apply in any case where the accident occurred elsewhere
that on, in or about the premises on which the principal has undertaken or
usually undertakes, as the case may be, to execute the work or which are
otherwise under his control or management.
Remedies of employer against Stranger
Where a workman has recovered compensation is respect of any injury caused
under circumstances creating a legal liability in respect thereof, the person by
whom the compensation was paid to pay damages in respect thereof, the person by
whom the compensation was paid and any person who has been called on to pay
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indemnity under section 12 shall be entitled to be indemnified by the person so

liable to pay damages as aforesaid.
Insolvency of employer
1. Where any employer has entered into a contract with any insurers in respect
of any liability under this Act to any workman, then in the event of the
employer becoming insolvent or making a composition or scheme of
arrangement with his creditors or, if the employer is a company, in the event
of the company having commenced to be wound up, the rights of the employer
against the insurers as respects that liability shall, notwithstanding anything
in any law for the time being in force relating to insolvency or the winding up
of companies, be transferred to and vest in the workman, and upon any such
transfer the insurers shall have the same rights and remedies and be subject
to the same liabilities as if they were the employer, so, however, that the
insurers shall not be under any greater liability to the workman than they
would have been under to the employer.
2. If the liability of the insurers to the workman is less than the liability of the
employer to the workman, the workman may prove for the balance in the
insolvency proceedings or liquidation.
3. Where in any case such as is referred to in sub-section (1) the contract of the
employer with insurers is void or voidable by reason of non-compliance on the
part of the employer with any terms or conditions of the contract (other than a
stipulation for the payment of premia), the provisions of that sub-section shall
apply as if the contract were not void or voidable, and the insurers shall be
entitled to prove in the insolvency proceedings or liquidation for the amount
paid to the workman.
4. Where the compensation is a half-monthly payment, the amount due in
respect thereof shall, for the purposes of this section, be taken to be the
amount of the lump sum for which the half-monthly payment could, if
redeemable, be redeemed if applications were made for that purpose under
section 7, and a certificate of the Commissioner as to the amount of such sum
shall be conclusive proof thereof.
5. The provisions of sub-section (4) shall apply in the case of any amount for
which an insurer is entitled to prove under sub-section (3), but otherwise
those provisions shall not apply where the insolvent or the company being
would up has entered into such a contract with insurers as is referred to in
sub-section (1).
6. This section shall not apply where a company is wound up voluntarily merely
for the purposes of reconstruction or of amalgamation with another company.
Returns as to compensation
The State Government may, by notification in the Official Gazette, direct that
every person employing workmen, or that any specified class of such persons, shall
send at such time and in such from and to such authority, as may be specified in
the notification, a correct return specifying the number of injuries in respect of
which compensation has been paid by the employer during the previous years and
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the amount of such compensation together with such other particulars as to the
compensation as the State Government may direct.
Contracting out
Any contract of agreement whether made before or after the commencement of
this Act, whereby a workman relinquishes any right of compensation from the
employer for personal injury arising out of or in the course of the employment, shall
be null and void insofar as it purports to remove or reduce the liability of any
person to pay compensation under this Act.
COMMISSIONERS
Reference to 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 a workman) or as to the amount or duration of
compensation (including any questions as to the nature or extent of
disablement), the question shall, in default of agreement, be settled by a
Commissioner.
2. No Civil shall have jurisdiction to settle, decide or deal with any question
which is by or under this Act required to be settled, decided dealt with by a
Commissioner or the enforce any liability incurred under this Act.
Appointment of Commissioners
1. The State Government may, by notification in the Official Gazette, appoint any
person to be a Commissioner for Workmen’s Compensation for such area, as
may be specified in the notification.
2. Where more than one Commissioner has been appointed of 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 assist
him in 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).
Venue of proceedings and transfer
1. Where any matter under this Act is to be done by or before a Commissioner,
the same shall, to the provisions of this Act and to any rules made hereunder,
be done by or before the Commissioner for the area in which-
a) The accident took place which resulted in the injury; or
b) The workman or in case of his death, the dependant claiming the
compensation ordinarily resides; or
c) The employer has his registered office:
2. If a Commissioner is satisfied that any matter arising out of any proceedings
pending before him can be more conveniently dealt with by any other
Commissioner, whether in the same State or not, he may, subject to rules
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made under this Act, order such matter to be transferred to such other
Commissioner either for report or for disposal, and, if he does so, shall
forthwith transmit to such other Commissioner all documents relevant for the
decision of such matter and, where the matter is transferred for disposal, shall
also transmit in the prescribed manner any money remaining in his hands or
invested by him for the benefit of any party to the proceedings.
3. The Commissioner to whom any matter is so transferred shall, subject to rules
made under this Act, inquire there into and, if the matter was transferred for
report, return his report thereon or, if the matter was transferred for disposal,
continue the proceedings as if they had originally commenced before him.
4. On receipt of a report from a Commissioner to whom any matter has been
transferred for report under sub-section (2), the Commissioner by whom it
was referred shall decide the matter referred in conformity which such report.
5. The State Government may transfer any matter from any Commissioner
appointed by it to any other Commissioner appointed by it.
Form of application
1. Where an accident occurs in respect which liability to pay compensation
under this Act arises, a claim for such compensation may, subject to the
provisions of this Act, be made before the Commissioner.
2. An application to a Commissioner may be made in such form and shall be
accompanied by such fee, if any, as may be prescribed, and shall contain, in
addition to any particulars which may be prescribed, the following particulars,
namely:-]
a) A concise statement of the circumstances in which the application is made
and the relief or order which the applicant claims;
b) In the case of a claim for compensation against an employer, the date of
service of notice of the accident on the employer, and, if such notice has
not been served or has not been served in due time, the reason for such
omission;
c) The names and address of the parties; and
d) Except in the case of an application by dependants for compensation a
concise statement of the matters on which agreement has and of those on
which agreement has not been come to.
Appearance of parties
Any appearance, application or act required to be made or done by any person
before or to a Commissioner (other than an appearance of a party which is required
for the purpose of his examination as a witness) may be made or done on behalf of
such person by a legal practitioner or by an official of an Insurance Company or a
registered Trade Union or by an Inspector appointed under sub-section (1) of
section 8 of the Factories Act, 1948 (63 of 1948), or under sub-section (1) of section
5 of the Mines Act, 1952 (35 of 1952), or bay any other officer specified by the State
Government in this behalf, authroised in writing by such person, or, with the
permission of the Commissioner, by any other person so authorized.
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Method or 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
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.
Costs
All costs, incidental to any proceedings before a Commissioner, shall, subject
to rules made under this Act, be in the discretion of the Commissioner.
Power to submit cases
A Commissioner may, if he thinks fit, submit any question of law for the
question of law for the decision of the High Court and, if he does so, shall decide
the question in conformity with such decision.
Registration of agreements
1) Where the amount of any lump sum payable as compensation has been settled
by agreement, whether by way of redemption of half-monthly payment or
otherwise, or where any compensation has been so settled as being payable to a
woman, or a person under a legal disability [***] a memorandum thereof shall be
sent by the employer to the Commissioner, who shall, on being satisfied as to its
genuineness, record the memorandum in a register in the prescribed manner:
Effect of failure to register agreement
Where a memorandum of any agreement the registration of which is required
by section 28, is not sent to the Commissioner as required by that section, the
employer shall be liable to pay the full amount of compensation which he is liable
to pay under the provisions of this Act, and not withstanding anything contained in
the proviso to sub-section (1) of section 4, shall not, unless the Commissioner
otherwise directs, be entitled to deduct more than half of any amount paid to the
workmen by way of compensation whether under the agreement or otherwise.
Appeals
1. An appeal shall lie to the High Court form the following orders of a
Commissioner, namely:-
a) An order awarding as compensation a lump sum whether by way of
redemption of a half-monthly payment or otherwise or disallowing a claim
in full or in part for a lump sum;
 An order awarding interest or penalty under section 4-A;
b) An order refusing to allow redemption of a half-monthly payment;
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c) An order providing for the distribution of compensation among the

dependants of a deceased workman, or disallowing any claim of a person
alleging himself to be such dependant;
d) An order allowing or disallowing any claim for the amount of an indemnity
under the provisions of sub-section (2) of section 12
RULES
Power of the State Government to make rules
1. The State Government may rules to carry out the purposes of this Act.
2. In particular and without prejudice to the generality of the foregoing power,
such rules may provide for all or any of the following matters, namely:-
a) For prescribing the intervals at which and the conditions subject to which an
application for review may be made under section 6 when not accompanied by
a medical certificate;
b) For prescribing the intervals at which and the conditions subject to which a
workman may required to submit himself for medical examination under sub-
section (1) of section 11;
c) For prescribing the procedure to be followed by Commissioners in the disposal
of cases under this Act and by the parties in such cases;
d) For regulating the transfer of matters and cases from one Commissioner to
another and the transfer of money in such cases;
e) For prescribing the manner in which money in the hands of a Commissioner
may be invested for the benefit of dependants of a deceased workman and for
the transfer of money so invested from one Commissioner to another;
f) For the representation in proceedings before Commissioners of parties who are
minors or are unable to make an appearance;
g) For prescribing the form and manner in which memoranda of agreements
shall be presented and registered;
h) For the withholding by Commissioners, whether in whose or in part of half-
monthly payments pending decision on applications for review of the same; [*]
i) For regulating the scales of costs which may be allowed in proceedings under
this Act;
j) For prescribing and determining the amount of the fees payable in respect of
any proceedings before a Commissioner under this Act;
k) For the maintenance by Commissioners of registers and records of
proceedings before them;
l) For prescribing the classes of employers who shall maintain notice-books
under sub-section (3) of section 10, and the form of such notice-books;
m) For Prescribing the form of statement to be submitted by employers under
section 10-A;
n) For prescribing the cases in which the report referred in section 10-B may be
sent to an authority other than the Commissioner;
o) for prescribing abstracts of this Act and requiring the employers to display
notices containing such abstracts;
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p) For prescribing the manner in which diseases specified as occupational

disease may be diagnosed;
q) For prescribing the manner in which diseases may be certified for any of the
purposes of this Act;
r) For prescribing the manner in which, and the standards by which, incapacity
may be assessed.
Publication of rules
1. The power to make rules conferred by section 32 shall be subject to the
condition of the rules being made after previous publication.
2. The date to be specified in accordance with clause (3) of section 23 of the
General Clauses Act, 1879 (10 of 1897), as that after which a draft of rules
purposed to be made under section 32 will be taken into consideration, shall
not be less than three months from the date on which the draft of the
proposed rules was published for general information.
1. This Act is administrated by State Govt. which appoints Commissioners for
this purpose under Sec 20 of the Act.
2. The amount of compensation to be paid to a workman depends on:
3. Nature of injury caused by accident, monthly wages of workman concerned
and relevant factor as specified in Schedule IV. This Act distinguishes between
three types injuries which are permanent partial disablement, permanent total
disablement and temporary disablement.
1. What are the penalties on the employer under the workman’s compensation
Act.
2. State the Rules regarding the notice of accident and to proper manner.
22.6 SUMMARY
The Workmen’s Compensation Act, 1923 provides for payment of
compensation to workmen and their dependants in case of injury and accident
(including certain occupational disease) arising out of and in the course of
employment and resulting in disablement or death. The amount of compensation to
be paid depends on the nature of the injury and the average monthly wages and age
of workmen. The minimum and maximum rates of compensation payable for death
(in such cases it is paid to the dependents of workmen) and for disability have been
fixed and is subject to revision from time to time.
1. Discuss the procedure for method of recording evidence by commissioner?
2. Discuss the distribution of compensation.
3. Elaborate on amount of compensation.
1. Hindustan Lever Vs Workman, AIR
2. Tata chemicals Ltd Vs. Kailas C.Adaryer AIR
181
3. Andhra Scientific Co. Employees Union Vs Manager.

22.9 ASSIGNMENTS
1. Discuss the liability of principal employer in respect of injury sustained by a
workman employed through a contractor.
2. Discuss the defences available to an employer against a claim for compensation.
3. Made by a workman under workmen’s compensation Act.
1. A.M.Sharma “Aspects of Labour welfare and social security”.
2. R.C.Seana “Labour problems and social welfare”.
3. Personnel Management and Industrial Relations; P.C.Tripathi.
11. LEARNING ACTIVITIES
1. State the Rules regarding Notice of accident and its proper manner.
2. Discuss the provisions for relating to commutation of half monthly payment.
12. KEY WORDS
1. Appeals
2. Commissioner
3. Disablement
4. Penalty
5. Contracting
6. Compensation

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LESSON – 23
MATERNITY BENEFITS ACT

23.1 INTRODUCTION
The object of maternity leave and benefit is to protect the dignity of
motherhood by providing full and healthy maintenance of women and her child
when she is not working with the Advent of Modern Age, the number of women
employees is growing the maternity leave and other maternity benefits are becoming
increasingly common. With the object of providing maternity leave and benefit to
women employee the maternity benefit bill was passed by both the houses of
parchment and subsequently it received the assent of president on 12 th Dec. 1961
to become an Act under short title and numbers. “The maternity benefit Act, 1961
(53 of 1961).
23.2 OBJECTIVES
After reading this chapter you should be able to
 Understand the statement of objects and definitions of the Act.
 Know the right to payment of maternity benefits.
 Understand the payment of medical bonus.
 Understand the appointment of inspectors.
 Know the penalty for obstructing inspector.
23.3 CONTENTS
Short title, extent and commencement
1. This Act may be called THE MATERNITY BENEFIT ACT, 1961.
3. It shall come into force on such date as may be notified in this behalf in the
Official Gazette.
a) In relation to mines and to any other establishment wherein persons are
employed for the exhibition of equestrian, acrobatic and other
performances, by the Central Government; and
b) In relation to other establishments in State, by the State Government.
Application of Act
1. It applies, in the first instance,
a) To every establishment being a factory, mine or plantain including any such
establishment belonging to Government and to every establishment wherein
persons are employed for the exhibition of equestrian, acrobatic and other
performances;
b) To every shop or establishment within the meaning of any law for the time
being in force in relation to shops and establishments in a State, in which ten
or more persons are employed, or were employed, on any day of the preceding
twelve months:
Provided that the State Government may, with the approval of the Central
Government, after giving not less than two month’s notice of its intention of so
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doing, by notification in the Official Gazette, declare that all or any of the provisions
of this Act shall apply also to any other establishment or class of establishments,
industrial, commercial, agricultural or otherwise.
2. Save as otherwise provided in sections 5-A and 5-B nothing contained in this Act
shall apply to any factory or other establishment to which the provisions of the
Employee’s State Insurance Act, 1948 (34 of 1948), apply for the time being.
Definitions in this Act, unless the context otherwise requires
a) “Appropriate Government” means, in relation to an establishment being a mine
or an establishment wherein persons are employed for the exhibition of
equestrian, acrobatic and other performances the Central Government and in
relation to any other establishment, the State Government;
b) “Child” includes a stillborn child;
c) “Delivery” means the birth of a child;
d) “Employer” means,
i) In relation to an establishment under any local authority, the person
appointed by such authority for the supervision and control employees or
where not person is so appointed, the Chief Executive Officer of the local
authority;
ii) 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;
e) “Establishment” means
 A factory;
 A mine;
 A plantation
 An establishment wherein persons are employed for the exhibition of
equestrian, acrobatic and other performances;
 An establishment to which the provisions of this Act have been declared
under sub-section (1) of section to be applicable;
f) “Factory” means a factory as defined in clause (m) of section 2 of the Factories
Act, 1948 (63 of 1948);
g) “Inspector” means an Inspector appointed under section 14;
h) “Maternity benefit” means the payment referred to in sub-section (1) of section 5;
a) “Medical termination of pregnancy” means the termination of pregnancy
permissible under the provisions of the Medical Termination of Pregnancy
Act, 1971 (34 of 1971);
i) “Mine” means a mine as defined in clause (j) of section 2 of the Mines Act, 1952
(35 of 1952);
j) “Miscarriage” means expulsion of the contents of a pregnant uterus at any
period prior to or during the twenty-sixth week of pregnancy but does not
184
include any miscarriage, the causing of which is punishable under the Indian
penal Code (45 of 1860);
k) “Plantation” means a plantation as defined in clause (f) of section 2 of the
Plantations Labour Act, 1951 (69 of 1951);
l) “Prescribed” means prescribed by rules made under this Act;
m) “State Government”, in relation to a Union territory, means the Administrator
thereof;
n) “Wages” means all remuneration paid or payable in cash to a woman, if the
terms of the contract of employment, express or implies, were fulfilled and
includes-
1. Such cash allowances (including dearness allowance and house-rent
allowance) as a woman is for the time being entitled to;
2. Incentive bonus; and
3. The money value of the concessional supply of food grains and other articles,
but does not include,
i) Any bonus other than incentive bonus;
ii) Over-time earning and any deduction or payment made on account of fines;
iii) Any contribution paid or payable by the employer to any pension fund or
provident fund or for the benefit of the woman under any law for the time
being in force; and
iv) Any gratuity payable on the termination of service;
o) “Woman” means a woman employed, whether directly or through any agency,
for wages in any establishment.
Employment of work by, women prohibited during certain period
1. No employer shall knowingly employ a woman in any establishment during
the six weeks immediately following the day of her delivery, miscarriage or
medical termination of pregnancy.
2. No woman shall work in any establishment during the six weeks immediately
following the day of her delivery, miscarriage or medical termination of
pregnancy.
3. Without prejudice to the provisions of section 6, no pregnant woman shall, on
a request being made by her in this behalf, be required by her employer to do
during the period specified in sub-section (4) any work which involves long
hours of standing or which in any way is likely to interfere with her
pregnancy or the normal development of the foetus, or is likely to cause her
miscarriage or otherwise to adversely affect her health.
4. The period referred to in sub-section (3) shall be,
a) The period of one month immediately preceding the period of six weeks,
before the date of her expected delivery;
b) Any period during the said period of six weeks for which the pregnant
woman does not avail of leave of absence under section 6.
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Right to payment of maternity benefits

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 that day.
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. The maximum period for which any woman shall be entitled to maternity
benefit shall be twelve weeks of which not more than six weeks shall precede
the date of her expected delivery;
Provided that where a woman dies during this period, the maternity benefit
shall be payable only for the days up to including the day of her death:
Provided further that where a woman, having been delivered of a child, dies
during her delivery or during the period immediately following the date of the
delivery, for which she is entitled for the maternity benefit, leaving behind in either
case the child, the employer shall be liable for the maternity benefit for that entire
period but if the child also dies during the said period, then, for the days up to and
including the date of the death of the child.
a) Continuance of payment of maternity benefit in certain cases.
Every woman entitled to the payment of maternity benefit under this Act shall,
notwithstanding the application of the Employee’s 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.
b) Payment of maternity benefit in certain cases
Every woman,
a) Who is employed in a factory or other establishment to which the provisions
of the Employees’ State Insurance Act, 1948 (34 of 1948), apply;
b) Whose wages (excluding remuneration for over-time work) for a month exceed
the amount specified in sub-clause (b) of clause (9) of section 2 of the Act;
and
c) Who fulfils the conditions specified in sub-section (2) of section 5, shall be
entitled to the payment of maternity benefit under this Act.
Notice of claim for maternity benefit and payment thereof
1. Any woman employed in an establishment and entitled to maternity benefit
under the provisions of this Act may give notice in writing in such form as
may be prescribed, to her employer, stating that her maternity benefit and any
other amount to which she may be entitled under this Act may be paid to her
or to such person as she may nominate in the notice and that she will not
186
work in any establishment during the period for which she receives maternity
benefit.
2. In the case of a woman who is pregnant, such notice shall state the date from
which she will be absent from work, not being a date earlier than six weeks
from the date of her expected delivery.
3. Any woman who has not given the notice when she was pregnant may give
such notice as soon as possible after the delivery.
4. On receipt of the notice, the employer shall permit such woman to absent
herself from the establishment during the period for which she receives the
maternity benefit.
5. The amount of maternity benefit for the period preceding the date of her
expected delivery shall be paid in advance by the employer to the woman on
production of such proof as may be prescribed that the woman is pregnant,
and the amount due for the subsequent period shall be paid by the employer
to the woman within forty-eight hours of production of such proof as may be
prescribed that the woman has been delivered of a child.
6. The failure to give notice under this section shall not disentitle a woman to
maternity benefit or any other amount under this Act if she is otherwise
entitled to such benefit or amount and in any such case an Inspector may
either of his own motion or on an application made to him by the woman,
order the payment of such benefit or amount within such period as may be
specified in the order.
Payment of maternity benefit in case of death of a woman
If a woman entitled to maternity benefit or any other amount under this Act,
dies before receiving such maternity benefit or amount, or where the employer is
liable for maternity benefit under the second proviso to sub-section (3) of section 5,
the employer shall pay such benefit or amount to the person nominated by the
woman in the notice given under section 6 and in case there is no such nominee, to
her legal representative.
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 the 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.
Leave for miscarriage, etc
In case of miscarriage or medical termination of pregnancy, a women shall, on
production of such proof as may be prescribed, be entitled to leave with wages at
the rate of maternity benefit, for a period of six weeks immediately following the day
of her miscarriage or, as the case may be, her medical termination of pregnancy.
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a) Leave with wages for tubectomy operation

In case tubectomy operation, a woman shall, on production of such proof as
may be prescribed, be entitled to leave with wages at the rate of maternity benefit
for a period of two weeks immediately following the day of her tubectomy operation.
Leave for illness arising out of pregnancy, delivery, premature birth of child, miscarriage,
medical termination of pregnancy or tubectomy operation
A woman suffering from illness arising out of pregnancy, delivery, premature birth
of child miscarriage, medical termination of pregnancy or tubectomy operation shall,
on production of such proof as may be prescribed, be entitled, in addition to the period
of absence allowed to her under section 6, or, as the case may be, under section 9,
leave with wages at the rate of maternity benefit for a maximum period of one month.
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.
Dismissal during absence of pregnancy
1. When a woman absents herself from work in accordance with the provisions of
this Act, it shall be unlawful for her employer to discharge or dismiss her
during or on account of such absence to give notice of discharge or dismissal
on such a day that the notice will expire during such absence, or to vary to
her disadvantage any of the conditions of her service.
2. (a)The discharge or dismissal of a woman at any time during her pregnancy, if
the woman but for such discharge or dismissal would have been entitled to
maternity benefit or medical bonus referred to in section 8, shall not have the
effect of depriving her of the maternity benefit or medical bonus:
Provided that where the dismissal if for any prescribed gross misconduct, the
employer may, by order in writing communicated to the woman, deprive her of the
maternity benefit or medical bonus or both.
(b) Any woman deprived of maternity benefit or medical bonus, or both, or
discharged or dismissed during or on account of her absence from work in
accordance with the provisions of this Act, may, within sixty days from the date on
which order of such deprivation or discharge or dismissal is communicated to her,
appeal to such authority as may be prescribed, and the decision of that authority
on such appeal, whether the woman should or should not be deprived of maternity
benefit or medical bonus or both, or discharged or dismissed shall be final.
(c) Nothing contained in this sub-section shall affect the provisions contained in
sub-section (1).
No deduction of wages in certain cases
No deduction from the normal and usual daily wages of woman entitled to
maternity benefit under the provisions of this Act shall be made by reason only of -
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a) The nature of work assigned to her by virtue of the provisions contained in sub-
section (3) of section 4; or
b) Breaks for nursing the child allowed to her under the provisions of section 11.
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 Act
and may define the local limits of the jurisdiction within which they shall exercise
their functions under this Act.
Powers and duties of Inspectors
An Inspector may, subject to such restrictions or conditions as may be
prescribed, exercise all or any of the following powers, namely,
a) Enter at all reasonable times with such assistants, if any, being persons in the
service of the Government or any local or other public authority, as he thinks
fit, any premises or place where woman are employed or work is given to them
in an establishment, for the purposes of examining any registers, records and
notices required to be kept or exhibited by or under this Act and require their
production for inspection;
b) Examine any person, whom he finds in any premises or place and who, he has
reasonable cause to believe, is employed in the establishment:
c) Provided that no person shall be compelled under this section to answer any
question or give any evidence tending to incriminate himself;
d) Require the employer to give information regarding the names and addresses
of women employed, payments made to them, and application or notices
received from them under this Act; and
e) Take copies of any registers and records or notices or any portions thereof.
Inspectors to be public servants
Every Inspector appointed under this Act shall be deemed to be a public
servant within the meaning of section 21 of the Indian Penal Code (45 of 1860).
Power of Inspector to direct payments to be made
1) Any woman claiming that,
a) Maternity benefit or any other amount to which she is entitled under this
Act and any person claiming that payment due under section 7 has been
improperly withheld;
b) Her employer has discharged or dismissed her during or an account of her
absence from work in accordance with the provisions of this Act, may make
a complaint to the Inspector.
2. The Inspector may, of his own motion or on receipt of a complaint referred to in
sub-section (1), make an inquiry or cause an inquiry to be made and if satisfied
that-
a) Payment has been wrongfully withheld, may direct the payment to be made
in accordance with his orders;
189
b) She has been discharged or dismissed during or an account of her absence

from work in accordance with the provisions of this Act, may pass such
order as are just and proper according to the circumstances of the case.
3. Any person aggrieved by the decision of the Inspector under sub-section (2) may,
within thirty days from the date on which such decision is communicated to
such person, appeal to the prescribed authority.
4. The decision of the prescribed authority where an appeal has been preferred to it
under sub-section (3) or of the Inspector where no such appeal has been
preferred shall be final.
5. Any amount payable under this section shall be recoverable by the Collector on a
certificate issued for that amount by the Inspector as an arrear of land revenue.
Forfeiture of maternity benefit
If a woman works in any establishment after she has been permitted by her
employer to absent herself under the provisions of section 6 for any period during
such authorized absence, she shall forfeit her claim to the maternity benefit for
such period.
Abstract of Act rules there under to be exhibited
An abstract of the provisions of this Act and the rules made there under in the
language of the locality shall be exhibited in a conspicuous place by the employer in
every part of the establishment in which women are employed.
Registers, etc
Every employer shall prepare and maintain such registers, records and
muster-rolls and in such manner as may be prescribed.
Penalty for contravention of Act by employer
1. If any employer fails to pay any amount of maternity benefit to a woman
entitled under this Act or discharges or dismisses such woman during or an
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. If any employer contravenes the provisions of this Act or the rules made there
under, 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,
190
recover such maternity benefit or amount as if it were a fine and pay the same
to the person entitled thereto.
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 there under or
conceals or prevents any person from appearing before or being examined by an
Inspector shall be punishable with imprisonment which may extent to one year, or
with fine which may extend to five thousand rupees, or with both.
Cognizance of offences
1. Any aggrieved woman, an office-bearer of a trade union registered under the
Trade Unions Act, 1926 (16 of 1926) of which such woman is a member or a
voluntary organization registered under the Societies Registration Act, of an
offence under this Act in any court of competent jurisdiction and no such
complaint shall be filled after the expiry of one year from the date on which
the offence is alleged to have been committed.
2. No Court inferior to that of a Metropolitan Magistrate or a Magistrate or a
Magistrate of the first class shall try any offence under this Act.
Protection of action taken in good faith
No suit, prosecution or other legal proceeding shall lie against any person for
anything which is in good faith done or intended to be done in pursuance of this
Act or of any rule or order made there under.
Power of Central Government to give directions
The Central Government may give such directions as it may deem necessary to
a State Government regarding the carrying into execution of the provisions of this
Act and the State Government shall comply with such directions.
Power to exempt establishments
If the appropriate Government is satisfied that having regard to an
establishment or a class of establishments providing for the grant of benefits which
are not less favourable than those provided in this Act, it is necessary so to do, it
may, by notification in the Official Gazette exempt, subject to such conditions and
restrictions, if any, as may be specified in the notification, the establishment or
class of establishments from the operation of all or any of the provisions of this Act
or of any rule made there under.
Effect of laws and agreements inconsistent with this Act
1. The provision of this Act shall have effect notwithstanding anything
inconsistent therewith contained in any other law or in the terms of any
award, agreement or contract of service, whether made before or after the
coming into force of this Act:
Provided that where under any such award, agreement, contract of service or
otherwise, a woman is entitled to benefits in respect of any matter which are
more favourable to her than those to which she would be entitled under this
Act, the woman shall continue to be entitled to the more favourable benefits in
191
respect of that matter, not withstanding that she is entitled to receive benefits
in respect of other matters under this Act.
2. Nothing contained in this Act shall be construed to preclude a woman from
entering into an agreement with her employer for granting her rights or
privileges in respect of any matter, which are more favourable to her than
those to which she would be entitled under This Act.
Power to make rules
1. The appropriate Government may, subject to the condition of previous
publication and by notification in the Official Gazette, make rules for carrying
out the purposes of this Act.
2. In Particular, and without prejudice to the generality of the foregoing power,
such rules may provide for,
a) The preparation and maintenance of registers, records and muster rolls;
b) The exercise of powers (including the inspection of establishments) and the
performance of duties by Inspectors for the purposes of this Act;
c) The method of payment of maternity benefit and other benefits under this
Act insofar as provision has not been made there for in this Act;
d) The form of notices under section 6;
e) The nature of proof required under the provisions of this act;
f) The duration of nursing breaks referred to in section 11;
g) Acts, which may constitute gross misconduct for purposes of section 12;
h) The authority to which an appeal under clause (b) of sub-section (2) of
section 12 shall lie; the form and manner in which such appeal may be
made and the procedure to be followed in disposal thereof;
i) The authority to which an appeal shall lie against the decision of Inspector
under section 17, the form and manner in which such appeal may be
made and the procedure to be followed in disposal thereof;
j) The form and manner in which complaints may be made Inspectors under
sub-section (1) of section 17 and the procedure to be followed by them
when making inquires or causing inquiries to be made under sub-section
(5) of that section;
k) Any other matter which is to be, or may be prescribed.
3. Every rule made by Central Government under this section shall be laid as
soon as may be after it is made, before each House of Parliament while it is in
session for a total period of thirty days which may be comprised in one session
or in two or more successive sessions, and if, before expiry of the session
immediately following the session or the successive sessions, aforesaid both
Houses agree in making any modification in the rule or both Houses agree
that the rule should not be made, the rule shall thereafter have effect only in
such modified form or be of no effect, as case may be; so, however, that any
such modification or annulment shall be without prejudice to the validity of
anything previously done under that rule.
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Amendment of Act 69 of 1951

In section 32 of the Plantations Labour Act, 1951,
a) In sub-section (1), the letter and brackets “(a)” before the words “in the case of
sickness”, the words “and” after the words “sickness allowance”; and clause (b)
shall be omitted;
b) In sub-section (2), the words “or maternity” shall be omitted.
Repeal
On the application of this Act
i) To mines, the Mines Maternity Benefit Act, 1941 (19 of 1941); and
ii) To factories situate in the Union territory of Delhi, the Bombay Maternity
Benefit Act, 1929, (Bombay Act 7 of 1929), as in force in that territory, shall
stand repealed.
The perfect of dignity of Motherhood and the dignity of a new person’s Birth by
providing for the full and healthy maintenance of women and her child at this
important time when she is not working cash benefits are given and leave with
average pay for six weeks before delivery, leave with average pay for six weeks after
delivery.
The non cash benefits include light work for 10 weeks before the rate of her
expected delivery, if she asks it. Two nursing breaks in the courses of her daily
work until the child is 15 months old. No discharge or dismissal which she is on
maternity leave. A pregnant woman discharged or dismissed may still claim
maturity benefit from the employer.
1. What are the leaves to which a woman is entitled in case of miscarriages or
illness arising out of pregnancy?
2. Discuss the powers & duties of inspectors appointed for the purpose of
maternity benefit Act.
23.6 SUMMARY
The maternity benefit Act 1961 regulates employment of women in certain
period before and after child birth and provides for maternity and other benefits.
Such benefits are armed to protect the dignity of motherhood by providing for the
full and healthy maintenance of women and her child when she is not working.
This Act is applicable to mines, factories, circus industry, plantations, shops &
establishments employing tenor more persons except employer covered under the
Employees State Insurance Act 1948.
1. Compare the maternity benefit Act, its provisions, conditions for eligibility of
benefits, claiming of benefits of other countries?
1. U. Unichay Vs State of Kerala AIR
2. Crompton Greaves Vs their workman AIR
193
3. Crown Aluminium Vs their workman, AIR

4. P.Industries Vs The Worker Men AIR
23.9 ASSIGNMENTS
1. Discuss the dismissal during absence of pregnancy?
2. Elaborate on payment of maternity benefits case of death of a women?
1. A.M.Sharma “Aspects of labour welfare and social security”
2. C.B.Memoria “Dynamics of Industrial Relation in India”.
3. N.G.Nair “Personnel Management and Industrial Relations”.
1. Surf internet. Find out the various establishments. which has implemented
this Act?
12. KEY WORDS
1. Delivery
2. Miscarriage
3. Medical Bonus
4. Inspector
5. Official Gazette

194
LESSON - 24
EMPLOYEES PROVIDENT FUND AND PAYMENT OF

GRATUITY ACT - ESI
24.1 INTRODUCTION
The Employees Provident Fund and miscellaneous provisions Act 1952 was
introduced for the benefit of employees working in factories and their family
members. The scheme shall apply to all employees or any class of employees of an
establishment as specified. The Act aimed at promoting and securing the wellbeing
of the employees by the way of provident fund, family pension and insurance to
them, inculcating a habit of saving amongst workers, providing a steady work force
to employers.
The employee state Insurance Act, 1948 is a pioneering measure in the field of
social insurance in our country. The subject of health insurance for industrial
workers was first discussed in 1927 by the Indian legislature, when the
applicability of the convention adopted by the international labour conference was
considered by the Govt. of India.
The Govt. of Kerala enacted legislation for payment of gratuity to workers
employed in factories, plantations, shops and establishment. The Governor of West
Bengal promulgated an ordinance on 3rd June 1971 wherein a scheme for payment
of gratuity was enacted - The ordinance was later replaced by the West Bengal
Employees Payment of compulsory Gratuity Act 1971 enacted by the President on
28th August 1971.
24.2 OBJECTIVES
After reading this chapter you should be able to
 Understand the objectives & scope of EPF Act.
 Know the employees provident fund schemes.
 Understand the different contributors to EPF.
 Know the duties and responsibilities of inspector.
 Understand the objects, reasons and definitions of Employee State
Insurance Act and payment of Gratuity Act.
 Know the corporation, standing committee and medical benefit council.
 Understand the various benefits provided by ESIC.
 Know the penalties for certain offences in the ESI and Gratuity Act.
 Know the nomination procedures in this Act.
 Understand the protection of payment of Gratuity Act.
24.3 CONTENTS
EMPLOYEES PROVIDENT FUND
Scope of the Act
The act extends to the whole of India expect the state of Jammu and Kashmir.
The act covered factory establishments employing 20 or more persons only ion six
195
specified industries namely, a) Cement, b) Cigarette, c) Electrical, mechanical or

general engineering products d) Iron and steel, e) Paper, f) Textiles (Cotton, Silks
and Jute). The Central Government was, however, empowered to extend the
provisions of the act to any establishment employing 20 or more persons. The
Central Government has applied the provisions of the act a number of factory and
non-factory establishments in various industries.
Presently the Act applies to factories and other establishments in over 150
industries and employing 20 or more persons (on completion of 5 years of existence
if employing less than 50 employees and on completion of 3 years of existence if
employing 50 or more persons). Once an establishment is covered under the Act, it
continues to be covered despite a decline below 20, except inc se where the number
is reduced to 15 during a continuous period of one year.
The Act does not apply to an establishment registered under the cooperative
societies Act, 1912 or under any law in any state relating to cooperative societies
and employing less than 50 persons and working without the aid of power.
Short title, extent and application
a) This Act may be called the employee’s provident funds and miscellaneous
provisions act, 1952.
b) It extends to the whole of India except the State of Jammu and Kashmir.
c) Subject to the provisions contained in section 16, it applies,
a) To every establishment which is a factory engaged in any industry specified in
Schedule I and in which twenty or more persons are employed, and
b) To any other establishment employing twenty or more persons or class of such
establishments which the Central Government may, by notification in the
Official Gazette, specify in this behalf;
Provided that the Central Government may, after giving not less than two
months’ notice of its intention so to do, by notification in the Official Gazette, apply
the provisions of this Act to any establishment employing such number of persons
less than twenty as may be specified in the notification.
Definitions
In this Act, unless the context otherwise requires,
a) “appropriate Government” means,
i) In relation to an establishment belonging to, or under the control of the
Central Government or in relation to an establishment connected with a
railway company, a major port, amine or an oilfield or a controlled
industry, or in relation to an establishment having department s or
branches in more than one State, the Central Government; and
ii) In relation to any other establishment, the State Government;
 “authorized officer” means the Central Provident Fund Commissioner,
Additional Central Provident Fund Commissioner, Deputy Provident
Fund Commissioner, Regional Provident Fund Commissioner or such
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other officer as may be authorized by the Central Government, by

notification in the Official Gazette;
b) “Basic wages” means all emoluments which are earned by an employee while
on duty or on leave or on holidays with wages in either case in accordance
with the terms of the contract of employment and which are paid or payable in
cash to him, but does not include-
i) The cash value of any food concession;
ii) Any dearness allowance (that is to say, all cash payments by whatever
name called paid to an employee on account of a rise in the cost of
living), house-rent allowance, overtime allowance, bonus, commission or
any other similar allowance payable to the employee in respect of his
employment or of work done in such employment;
iii) Any presents made by the employer;
c) “Contribution” means a contribution payable in respect of a member under a
Scheme or the contribution payable in respect of an employee to whom the
Insurance Scheme applies;
d) “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;
e) “Employer” means,
i) In relation to an establishment which is a factory, the owner or occupier of
the factory, including the agent of such owner or occupier, the legal
representative of a deceased owner or occupier and, where a person has been
named as a manager of the factory under clauses (f) of sub-section (1) of
section 7 of the Factories Act, 19489 (63 of 1948), the person so named; and
ii) In relation to any other establishment, 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 a manager, managing director or
managing agent, such manager, managing director or managing agent;
f) “Employee” means any person who is employed for wages in any kind of work,
manual or otherwise, in or in connection with the work of an establishment, and
who gets his wages directly or directly from the employer, and includes and person-
i) Employed by or through a contractor in or in connection with the work of
the establishment;
 “Exempted employee” means an employee to whom a Scheme or the
Insurance Scheme, as the case may be, would, but for the exemption
granted under section 17, have applied;
 “Exempted establishment” means an establishment in respect of which an
exemption has been granted under section 17 from the operation of all or
any of the provisions of any Scheme or the Insurance Scheme, as the case
may be, whether such exemption has been granted to the establishment
as such or to any person or class of persons employed therein;
197
g) “Factory” means and any premises, including the precincts thereof, in any
part of which a manufacturing process is being carried on or is ordinarily so
carried on, whether with the aid of power of without the aid of power;
h) “Fund” means the Provident Fund established under a Scheme;
i) “Industry” means any industry specified in Schedule I, and includes any other
industry added to the Schedule by notification under section 4;
i) “Insurance Fund” means the Deposit-Linked Insurance Fund established
sub-section (2) of section 6-C;
ii) “Insurance Scheme” means the Employees’ Deposit-Linked Insurance
Scheme framed under sub-section (1) of Section 6-C;
iii) “Manufacture” or “Manufacturing process” means any process for making,
altering, repairing, ornamenting, finishing, packing, oiling, washing,
cleaning, breaking up, demolishing or otherwise treating or adapting any
article or substance with a view
j) “Member” means member of the Fund;
k) “Occupier of a factory” means 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 deemed to be the occupier of the factory;
i) “Pension Fund” means the Employees’ Pension Fund established under
sub-section (2) of section 6-A;
ii) “Pension Scheme” means the Employees’ Pension Scheme framed under
sub-section (1) of section 6-A;
 “Prescribed” means prescribed by rules made under this Act;
 “Recovery Officer” means any officer of the Central Government, State
Government or the Board of Trustees constituted under section 5-A, who
may be authorized by the Central Government, by notification in the Official
Gazette, to exercise the powers of a Recovery Officer under this Act;
l) “Scheme” means the Employees’ Provident Fund Scheme framed under section;
 “Superannuation”, in relation to an employee, who is the member of the
Pension Scheme means the attainment, by the said employee, of the age
of fifty-eight years;
m) “Tribunal” means the Employees’ Provident Funds Appellate Tribunal
constituted under section 7-D.
a) Employees’ Provident Fund Schemes
1. The Central Government may, by notification in the Official Gazette, frame a
Scheme to be called the Employees’ Provident Fund Scheme for the
establishment of Provident Funds under this Act for employees on for any
class of employees and specify the establishments or class of establishments
to which the said Scheme shall apply and there shall be established, as soon
as may be after the framing of the Scheme, a Fund in accordance with the
provisions of this Act and the Scheme.
198
a) The Fund shall vest in, and be administered by, the Central Board
constituted under section 5-A.
b) Subject to the provisions of this Act, a Scheme framed under sub-section (1)
may provide for all or any of the matters specified in Schedule II.
2. A Scheme framed under sub-section (1) may provide that any of its provisions
shall take effect either prospectively or retrospectively on such date as may be
specified in this behalf in the Scheme.
a. Central Board
1. The Central Government may, by notification in Official Gazette, constitute
with effect from such date as may be specified therein, a Board of Trustees
for the territories to which this Act extends (hereinafter in this Act referred to
as the Central Board consisting of the following persons as members, namely:
a) A Chairman and a Vice-Chairman to be appointed by the Central Government;
 The Central Provident Fund Commissioner, ex Officio;
b) Not more than five persons appointed by the Central Government from
amongst its officials;
c) Not more than fifteen persons representing Governments of such States as
the Central Government may specify in this behalf, appointed by the
Central Government;
d) Ten persons representing employers of the establishment to which the
Scheme applies, appointed by the Central Government after consultation
with such organizations of employers as may be representing employers as
may be recognized by the Central Government in this behalf; and
e) Ten persons representing employees in the establishments to which the
Scheme applies, appointed by the Central Government after consultation
with such organizations of employees as may be recognized by the Central
Government in this behalf.
2. The terms and conditions subject to which a member of the Central Board
may be appointed and the time, place and procedure of the meetings of the
Central Board shall be such as may be provided for in the Scheme.
3. The Central Board shall perform such other functions as it may be required
to perform by or under any provisions of the Scheme, the Pension Scheme
and the Insurance Scheme.
4. The Central Board shall maintain proper accounts of its income and
expenditure in such form and in such manner as the Central Government
may, after consultation with the Comptroller and Auditor-General of India,
specify in the Scheme.
5. The accounts of the Central Board shall be audited annually by the
Comptroller and Auditor-General of India and any expenditure incurred by
him in connection with such audit shall be payable by the Central Board to
the Comptroller and Auditor-General of India.
6. The Comptroller and Auditor-General of India and any person appointed by
him in connection with the audit of the accounts of the Central Board shall
199
have the same rights and privileges and authority in connection with such
audit as the Comptroller and Auditor-General has, in connection with audit
of Government accounts and, in particular, shall have the rights to demand
the production of books, accounts, connected vouchers, documents and
papers and inspect any of the offices of the Central Board.
7. The accounts of the Central Board as certified by the Comptroller and Auditor
-General of India or any other person appointed by him in this behalf
together with the audit report thereon shall be forwarded to the Central
Board which shall forward the same to the Central Government along with its
comments on the report of the Comptroller and Auditor-General.
Executive Committee
1. The Central Government may, by notification in the Official Gazette,
constitute, with effect from such date as may be specified therein, an
Executive Committee to assist the Central Board in the performance of its
functions.
2. The Executive Committee shall consist of the following persons as members,
namely:
a) A Chairman appointed by the Central Government from amongst the members
of the Central Board;
b) Two persons appointed by the Central Government form amongst persons
referred to in clause (b) of sub-section (1) of section 5-A;
c) Three persons appointed by the Central Government from amongst the
persons referred to in clause (c) of sub-section (1) of section 5-A;
d) Three persons representing the employers elected the Central Board from
amongst the persons referred to in clause (d) of sub-section (1) of section 5-A;
e) Three persons representing the employees elected by the Central Board
from amongst the persons referred to in clause (e) of sub-section (1) of
section 5-A;
f) The Central Provident Fund Commissioner, ex officio.
b. State Board
1. The Central Government may, after consultation with the Government of any
State, by notification in the Official Gazette, constitute for that State a Board
of Trustees (hereinafter in this Act referred to as the State Board), in such
manner as may be provided for the Scheme.
2. A State Board shall exercise such powers and perform such duties as the
Central Government may assign to it from time to time.
c. Board of Trustees to be body corporate.
Every Board of Trustees constituted under section 5-A or section 5-B shall be
a body corporate under the name specified in the notification constituting it, having
perpetual succession and a common seal and shall by the said name sue and be
sued.
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d. Appointment of officers
1. The Central Government shall appoint a Central Provident Fund
Commissioner who shall be the Chief Executive Officer of the Central Board
and shall be subject to the general control and superintendence of that Board.
2. The Central Government may also appoint a Financial Adviser and Chief
Accounts Officer to assist the Central Provident Fund Commissioner in the
discharge of his duties.
3. No appointment to the post of the Central Provident Fund Commissioner or an
Additional Central Provident Fund Commissioner or a Financial Advisor and
Chief Accounts Officer or any other post under the Central Board carrying a
scale of pay equivalent to the scale of pay of any Group ‘A’ or Group ‘B’ post
under the Central Government shall be made except after consultation with
the Union Public Service Commission.
Employees’ Pension Scheme
1. The Central Government may, by notification in the Official Gazette, frame a Scheme
to be called the Employees’ Pension Scheme for the purpose of providing for,
a) Superannuation pension, retiring pension or permanent total disablement
pension to the employees of any establishment or class of establishments
to which this Act applies; and
b) Widow or widower’s pension, children pension or orphan pension payable
to the beneficiaries of such employees.
2. Notwithstanding anything contained in section 6, there shall be established, as
soon as may be after framing of the Pension Scheme, a Pension Fund into which
there shall be paid, from time to time, in respect of every employee who is a
member of the Pension Scheme,
a) Such sums from the employer’s contribution under section 6, not exceeding
eight and one-third per cent., of the basic wages, dearness allowance and
retaining allowance, if any, of the concerned employees, as may be specified
in the Pension Scheme;
b) Such sums as are payable by the employers of exempted establishments
under sub-section (6) of section 17;
c) The net assets of the Employees’ Family Pension Fund as on the date of the
establishment of the Pension Fund;
d) Such sums as the Central Government may, after due appropriation by
Parliament by law in this behalf, specify.
3. On the establishment of the Pension Fund, the Family Pension Scheme (hereinafter
referred to as the ceased Scheme) shall cease to operate and all assets of the ceased
Scheme shall vest in and shall stand transferred to, and all liabilities under the
ceased Scheme shall be enforceable against, the Pension Fund and the beneficiaries
under the ceased Scheme shall be entitled to draw the benefits, not less than the
benefits they were entitled to under the ceased Scheme, from the Pension Fund.
4. The Pension Fund shall vest in and administered by the Central Board in such
manner as may be specified in the Pension Scheme.
201
5. Subject to the provisions of this Act, the Pension Scheme may provide for all or
any of the matters specified in Schedule III.
6. The Pension Scheme may provide that all or any of its provisions shall take effect
either prospectively or retrospectively on such date as may be specified in that
behalf in that Scheme.
c. Employees’ Deposit-Linked Insurance Scheme
Scheme to be called the Employees’ Deposit-Linked Insurance Scheme for the
purpose of providing life insurance benefits to the employees of any
establishment or class of establishments to which this Act applies.
2. There shall be established, as soon as may be after the framing of the
Insurance Scheme, a Deposit-Linked Insurance Fund into which shall be paid
by the employer from time to time in respect of every such employee in
relation to whom he is the employer, such amount, not being more than one
per cent of the aggregate of the basic wages, dearness allowance and retaining
allowance (if any) for the time being payable in relation to such employee as
the Central Government may, by notification in the Official Gazette, specify.
3. The employer shall pay into the Insurance Fund such further sums of money,
not exceeding one-fourth of the contribution which he is required to make
under sub-section (2), as the Central Government may, from time to time,
determine to meet all the expenses in connection with the administration of
the Insurance Scheme other than the expenses towards the cost of any
benefits provided buy or under that Scheme.
4. The Insurance Fund shall vest in the Central Board and be administered by it
in such manner as may be specified in the Insurance Scheme.
5. The Insurance Scheme may provide for all or any of the matters specified in
Schedule IV.
6. The Insurance Scheme may provide that any of its provisions shall take effect
either prospectively or retrospectively on such may be specified in this behalf
in that Scheme.
d. Laying of Schemes before Parliament

Every Scheme framed under section 5, section 6-A and section 6-C shall be
laid, as soon as may be after it is framed, before each House of Parliament, while it
is in session, for a total period of thirty days which may be comprised in one
session or in two or more successive sessions, and if, before the expiry of the
session immediately following the session or the successive sessions aforesaid, both
Houses agree in making any modification in the Scheme, or both Houses agree that
the Scheme should not be framed, the Scheme shall thereafter have effect only in
such modified form or be of no effect, as the case may be; so, however, that any
anything previously done under that Scheme.
202
Modification of Scheme
Scheme to be called the Employees’ Deposit-Linked Insurance Scheme for the
purpose of providing life insurance benefits to the employees of any
establishment or class of establishments to which this Act applies.
2. There shall be established, as soon as may be after the framing of the
Insurance Scheme, a Deposit-Linked Insurance Fund into which shall be paid
by the employer from time to time in respect of every such employee in relation
to whom he is the employer, such amount, not being more than one per cent,
of the aggregate of the basic wages, dearness allowance and retaining
allowance (if any) for the time being payable in relation to such employee as the
Central Government may, by notification in the Official Gazette, specify.
3. The employer shall pay into the Insurance Fund such further sums of money,
not exceeding one-fourth of the contribution which he is required to make
under sub-section (2), as the Central Government may, from time to time,
determine to meet all the expenses in connection with the administration of the
Insurance Scheme other than the expenses towards the cost of any benefits
provided by or under that Scheme.
4. The Insurance Fund shall vest in the Central Board and be administered by it
in such manner as may be specified in the Insurance Scheme.
5. The Insurance Scheme may provide for all or any of the matters specified in
Schedule IV.
6. The Insurance Scheme may provide that any of its provision shall take effect
either prospectively or retrospectively on such date as may be specified in this
behalf in that Scheme.
d. Laying of Schemes before Parliament
Ever Scheme framed under section 5, section 6-A and section 6-C shall be
laid, as soon as may be after it is framed, before each House of parliament, while it
is in session, for a total period of thirty days which may be comprised in one
session or in two or more successive sessions, and if, before the expiry of the
session immediately following the session or the successive sessions aforesaid, both
Houses agree in making any modification in the Scheme, or both Houses agree that
the Scheme should not be framed, the Scheme shall thereafter have effect only in
such modified form or be of no effect, as the case may be; so, however, that any
anything previously done under that Scheme.
Modification of Scheme
1. The Central Government may, by notification in the Official Gazette, add to,
amend or vary, either prospectively or retrospectively, the Scheme, the
Pension Scheme or the Insurance Scheme, as the case may be.
a. Determination of moneys due from employers
1. The Central Provident Fund Commissioner, any Additional Central Provident
Fund Commissioner, any Deputy Provident Fund Commissioner, any
203
Regional Provident Fund Commissioner or any Assistant Provident Fund

Commissioner, may, by order,
a) In ac case where a dispute arises regarding the applicability of this Act to
an establishment, decide such dispute; and
b) Determine the amount due from any employer under any provision of
this Act, the Scheme or the Pension Scheme or the Insurance Scheme, as
the case may be, and for any of the aforesaid purposes may conduct
such inquiry as he may deem necessary.
2. The officer conducting the inquiry under sub-section (1) shall, for the
purposes of such inquiry, have the same powers as are vested in a Court
under the Code of Civil Procedure, 1908 (5 of 1908), for trying a suit in
respect of the following matters, namely:
a) Enforcing the attendance of any person or examining him on oath;
b) Requiring the discovery and production of documents;
c) Receiving evidence on affidavit;
d) Issuing commissions for the examination of witnesses; and any such
inquiry shall be deemed to be a judicial proceeding within the meaning of
sections 193 and 228, and for the purpose of section 196, of the Indian
Penal Code (45 of 1860).
b. Review of orders passed under section 7-A
1. Any person aggrieved by an order made under sub-section (1) of section 7-a,
but from which no appeal has been preferred under this Act, and who, from
the discovery of new and important matter or evidence which, after the
exercise of due diligence was not within his knowledge or could not be
produced by him at the time when the order was made, or an account of some
mistake or error apparent on the face of the record or for any other sufficient
reason, desires to obtain a review of such order may apply for a review of that
order to the officer who passed the order:
Provided that such officer may also on his own motion review his order if he is
satisfied that it is necessary so to do on any such ground.
2. Every application for review under sub-section (1) shall be filed in such form
and manner and within such time as may be specified in the Scheme.
3. Where it appears to the officer receiving an application for review that there is
no sufficient ground for a review, he shall reject the application.
4. Where the officer is of opinion that the application for review should be
granted, he shall grant the same:
c. Determination of escaped amount
Where an order determining the amount due from an employer under section
7-A or section 7-B has been passed an if the officer who passed the order,
a) Has reason to believe that by reason of the omission or failure on them part of the
employer to make any document or report available, or to disclose, fully and truly, all
material facts necessary for determining the correct amount due from the employer,
any amount so due from such employer for any period has escaped his notice;
204
b) Has, in consequence of information in his possession, reason to believe that any

amount to be determined under section 7-A or section 7-B has escaped from his
determination for any period notwithstanding that there has been no omission or
failure as mentioned in clause (a) on the part of the employer, he may, within a period
of five years from the date of communication of the order passed under section 7-A or
section 7-B, re-open the case and pass appropriate orders re-determining the amount
due from the employer in accordance with the provision of this Act:
d. Employees’ Provident Funds Appellate Tribunal
1. The Central Government may, by notification in the Official Gazette, constitute
one or more Appellate Tribunals to be known as the Employees’ Provident
Funds Appellate Tribunal to exercise the powers and discharge the functions
conferred on such Tribunal by this Act and every such Tribunal shall have
jurisdiction in respect of establishments situated in such area as may be
specified in the notification constituting the Tribunal.
2. A Tribunal shall consist of one person only to be appointed by the Central
Government.
3. A person shall not be qualified for appointment as a Presiding Officer of a
Tribunal (hereinafter referred to as the Presiding Officer), unless he is, or has
been, or is qualified to be,-
i) A Judge of a High Court; or
ii) A District Judge.
e. Term of Office
The Presiding Officer of a Tribunal shall hold office for a term of five years from
the date on which he enters upon his office or until he attains the age of sixty-two
years, whichever is earlier.
f. Orders of Tribunal
1. A Tribunal may, after giving the parties to the appeal on opportunity of being
heard, pass such orders thereon as it thinks fit, confirming, modifying or
annulling the order appealed against or may refer the case back to the
authority which passed such order with such directions as the Tribunal may
think fit, for a fresh adjudication or order, as the case may be, after taking
additional evidence, if necessary.
2. A Tribunal may, at any time within five years from the date of its order, with a
view to rectifying any mistake apparent from the record, amend any order
passed by it under sub-section (1) and shall make such amendment in the
order if the mistake brought to its notice by the parties to the appeal:
Provided that an amendment which has the effect of enhancing the amount
due from, or otherwise increasing the liability of, the employer shall not be
made under this sub-section, unless the Tribunal has given notice to him of
its intention to do so and has allowed him a reasonable opportunity of being
heard.
3. A Tribunal shall send a copy of every order passed under this section to the
parties to the appeal.
205
4. Any order made by a Tribunal finally disposing of an appeal shall not be

questioned in any Court of law.
g. Filling up of vacancies
If, for any reason, a vacancy occurs in the office of the Presiding Officer, the
Central Government shall appoint another person in accordance with the
provisions of this Act, to fill the vacancy and the proceedings may be continued
before a Tribunal from the stage at which the vacancy is filled.
h. Finality of orders constituting a Tribunal
No order of the Central Government appointing any person as the Presiding
Officer shall be called in question in any manner, and no ct or proceeding before a
Tribunal shall be called in question in any manner on the ground merely of any
defect in the constitution of such Tribunal.
Recovery of money by employers and contractors
1. The amount standing to the credit of any member in the Fund or of any
exempted employee in a Provident Fund shall not in any way be capable of
being assigned or charged and shall not be liable to attachment under any
decree or order of any Court in respect of any debt or liability incurred by the
member or the exempted employee, and neither the official assignee appointed
under the Presidency Towns Insolvency Act, 1909 (3 of 1909), nor any receiver
appointed under the Provincial Insolvency Act, 1920 (5 of 1920), shall be
entitled to, or have any claim on, any such amount.
2. Any amount standing to the credit of a member in the Fund or of an exempted
employee in a Provident Fund at the time of his death and payable to his
nominee under the Scheme or the rules of the Provident Fund shall, subject to
any deduction authorized by the said Scheme or rules, vest in the nominee
and shall be free from any debt or other liability incurred by the deceased or
the nominee before the death of the member or of the exempted employee and
shall also not be liable to attachment under any decree or order of any Court.
Priority of payment of contributions over other debts
1. Where any employer is adjudicated insolvent or, being a company, an order for
winding up is made, the amount due,
a) From the employer in relation to an establishment to which any Scheme or
the Insurance Scheme applies in respect of any contribution payable to the
Fund or, as the case may be, the Insurance Fund, damages recoverable
under section 14-B, accumulations required to be transferred under sub-
section (2) of section 15 or any charges payable by him under any other
provision of this Act or of any provision of the Scheme or the Insurance
Scheme; or
b) From the employer in relation to an exempted establishment in respect of
any contribution to the Provident Fund or any insurance fund (in so far as it
relates to exempted employees), under the rules of Provident Fund or any
insurance fund any contribution payable by him towards the Pension Fund
under sub-section (6) of section 17, damages recoverable under action 14-B
206
or any charges payable by him to the appropriate Government under any

provision of this Act or under any of the conditions specified under section
17, shall, where the liability there for has accrued before the order
adjudication or winding up is made, be deemed to be included among the
debts which under section 49 of the Presidency Towns Insolvency Act, 1909
(3 of 1909), or under section 61 of the Provincial Insolvency Act, 1920 (5 of
1920), or under section 4\530 of the Companies Act, 1956 (1 of 1956), are to
be paid in priority to all other debts in the distribution of the property of the
insolvent or the assets of the company being wound up, as the case may be.
Table 24.1 Rate of contribution
Scheme Employee’s Employer’s Central Govt’s
Provident Fund 12%  Amount > 8.33% (in case where Nil
Scheme contribution is 12% or 10%)
 10% (in case of certain
establishment as per details
given earlier)
Insurance Scheme Nil  0.5% Nil
Pension Scheme Nil  8.33% (Diverted out of 1.16%

Provident Fund contribution)
Employer not to reduce wages, etc
No employer in relation to an establishment to which any Scheme or the
Insurance Scheme or the Insurance Scheme applies shall, by reason only of his
liability for the payment of any contribution to the Fund or the Insurance Fund or
any charge under this Act or the Scheme or the Insurance Scheme, reduce, whether
directly or indirectly, the wages of any employee to whom the Scheme or the
Insurance Scheme applies or the total quantum of benefits in the nature of old age
pension, gratuity, Provident Fund or life insurance to which the employee is entitled
under the terms of his employment, express or implied.
Inspectors
1. The appropriate Government may, by notification in the Official Gazette, appoint
such persons as it thinks fit to be Inspectors for the purposes of this Act, the
Scheme, the Pension Scheme or the Insurance Scheme, and may define their
jurisdiction.
2. Any Inspector appointed under sub-section (1) may, for the purpose of inquiring
into the correctness of any information furnished in connection with this Act or
with any Scheme or the Insurance Scheme or for the purpose of ascertaining
whether any of the provisions of this Act or of any Scheme or the Insurance
Scheme have been complied with in respect of an establishment to which any
Scheme or the Insurance Scheme applies or for the purpose of ascertaining
whether the provisions of this Act or any Scheme or the Insurance Scheme are
applicable to any establishment to which the Scheme or the Insurance Scheme
207
has not been applied or for the purpose of determining whether the conditions
subject to which exemption was granted under section 17 are being complied
with by the employer in relation to an exempted establishment-
a) Require an employer or any contractor from whom any amount is recoverable
under section 8-A to furnish such information as he may consider necessary;
b) At any reasonable time and with such assistance, if any, as he may think fit,
enter and search any establishment or any premises connected therewith and
require any one found in charge thereof to produce before him for examination
any accounts, books, registers and other documents relating to the
employment persons or the payment of wages in the establishment;
c) Examine, with respect to any matter relevant to any of the purposes aforesaid,
the employer or any contractor from whom any amount is recoverable under
section 8-A, his agent or servant or any other person found in charge of the
establishment or any premises connected therewith or whom the Inspector
has reasonable cause to believe to be or to have been, an employee in the
establishment;
d) Make copies of, or take extracts from, any book, register or their document
maintained in relation to the establishment and, where he has reason to believe
that any offence under this Act has been committed by an employer, seize with
such assistance as he may think fit, such book, register or other document or
portions thereof as he may consider relevant in respect of that offence;
Penalties
1. Whoever, for the purpose of avoiding any payment to be made by himself under
this Act, the Scheme, the Pension Scheme or the Insurance Scheme or of
enabling any other person to avoid 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 one year, or with fine of five
thousand rupees, or with both.
2. (1-A) An employer who contravenes, or makes default in complying with, the
provisions of section 6 or clause (a) of sub-section (3) of section 17 in so far as it
relates to the payment of inspection charges, or paragraph 38 of the Scheme in
so far as it relates to the payment of administrative charges, shall be punishable
with imprisonment for a term which may extend to three years but,
a) Which shall not be less than one year and fine or ten thousand rupees in
case of default in payment of the employees’ contribution which has been
deducted by the employer from the employees’ wages;
b) Which shall not be less than six months and a fine of five thousand rupees,
in any other case:
Provided that the Court may, of any adequate and special reasons to be
recorded in the judgment, impose a sentence of imprisonment for a lesser term.
(1-B) An employer who contravenes, or makes default in complying with the
provisions of section 6-C, or clause (a) of sub-section (3-A) of section 7 in so far
as it relates to the payment of inspection charges, shall be punishable with
imprisonment for a term which may extend to one year but which shall not be
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less than six months and shall also be liable to fine which may extended to five
thousand rupees:
Provided that the Court, may for any adequate and special reasons to be
recorded in the judgment, impose a sentence of imprisonment for lesser term.
2. Subject to the provisions of this Act, the Scheme, the Pension Scheme or the
Insurance Scheme may provide that any person who contravenes, or makes
default in complying with any of the provisions thereof shall be punishable with
imprisonment for a term which may extend to one year, or with fine which may
extend to four thousand rupees, or with both.
a) Whoever contravenes or makes default in complying with any provision of
this Act or of any condition subject to which exemption was granted under
section 17 shall, if no other penalty is elsewhere provided by or under this
Act for such contravention or non-compliance, be punishable with
imprisonment which may extend to six months, but which shall not be less
than one month, and shall also be liable to fine which may extend to five
thousand rupees.
Offence by companies
1. If the person committing an offence under this Act, the Scheme or, the Pension
Scheme or the Insurance Scheme 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 such
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, the Scheme or, the Pension Scheme or the Insurance Scheme has been
committed by a company and it is proved that the offence 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.
A. Certain offences to be cognizable
Notwithstanding anything contained in the Code of Criminal Procedure, 1898
(5 of 1898), am offence relating to default in payment of contribution by the
employer punishable under this act shall be cognizable.
B. Power to recover damages
Where an employer makes default in the payment of any contribution to the
Fund, the Pension Fund or the Insurance Fund or in the transfer of accumulations
required to be transferred by him under sub-section (2) of section 15 or sub-section
(5) of section 17 or in the payment of any charges payable under any other
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provision of this Act or of any Scheme or Insurance Scheme or under any of the
conditions specified under section 17, the Central Provident Fund Commissioner or
such other officer as may be authorized by the Central Government, by notification
in the Official Gazette, in this behalf may recover from the employer by way of
penalty such damages, not exceeding the amount of arrears, as may be specified in
the Scheme:
Provided that before levying and recovering such damages, the employer
shall be given a reasonable opportunity of being heard:
C. Power of Court to make orders
1. Where an employer is convicted of an offence of making default in the payment
of any contribution to the Fund, the Pension Fund or the Insurance Fund or in
the transfer of accumulations required to be transferred by him under sub-
section (2) of section 15 or sub-section (5) of section 17, the Court may, in
addition to awarding any punishment, by order in writing require him within a
period specified in the order (which the Court may, if it thinks fit and on
application in that behalf, from time to time, extend), to pay the amount of
contribution or transfer the accumulations, as the case may be, in respect of
which the offence was committed.
2. Where an order is made under sub-section (1), the employer shall not be liable
under this Act in respect of the continuation of the offence during the period or
extended period, if any, allowed by the Court, but if, on the expiry of such
period or extended period; as the case may be, the order of the Court has not
been fully complied with, the employer shall be deemed to have committed a
further offence and shall be punished with imprisonment in respect thereof
under section 14 and shall also be liable to pay fine which may extend to one
hundred rupees for every day after such expiry on which the order has not
been complied with.
Act not apply to certain establishments
1. This Act shall not apply,
a) To any establishment registered under the Co-operative Societies Act, 1912 (2
of 1912), or under any other law for the time being in force in any State
relating to co-operative societies, employing less than fifty persons and
working without the aid of power; or
b) To 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 or rule framed by the Central Government governing such
benefits; or
c) To any other establishment set up under any Central, Provincial or State Act
and whose employees are entitled to the benefits of contributory provident
fund or old age pension in accordance with any Scheme or rule framed under
that Act governing such benefits;
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a. Authorising certain employers to maintain provident fund accounts

1. The Central Government may, on an application made to it in this behalf by the
employer and the majority of employees in relation to an establishment
employing one hundred or more persons, authorize the employer, by an order
in writing, to maintain a provident fund account in relation to the
establishment, subject to such terms and conditions as may be specified in the
Scheme:
Provided that no authorisation shall be made under this sub-section if the
employer of such establishment had committed any default in the payment of
Provident Fund contribution or had committed any other offence under this Act
during the three years immediately preceding the date of such authorisation.
2. Where an establishment is authorized to maintain a Provident Fund account
under sub-section (1), the employer in relation to such establishment shall
maintain such account, submit such return, deposit the contribution in such
manner, provide for such facilities for inspection, pay such administrative
charges, and abide by such other terms and conditions, as may be specified in
the Scheme.
Power to exempt
1. The appropriate Government may, by notification in the Official Gazette, and
subject to such conditions as may be specified in the notification, exempt,
whether prospectively or retrospectively, from the operation of all or any of
the provisions of any Scheme,
a) Any establishment to which this Act applies if, in the opinion of the
appropriate Government, the rules of its Provident Fund with respect to the
rates of contribution are not less favourable than those specified in section 6
and the employees are also in enjoyment of other Provident Fund benefits
which on the whole are not less favourable to the employees than the
benefits provided under this Act or any Scheme in relation to the employees
in any other establishment of a similar character; or
b) Any establishment if the employees of such establishment are in enjoyment
of benefits in the nature of Provident Fund, pension or gratuity and the
appropriate Government is of opinion that such benefits, separately or
jointly, are on the whole not less favourable to such employees than the
benefits provided under this Act or any Scheme in relation to employees in
any other establishment of a similar character:
Provided that no such exemption shall be made except after consultation with
the Central Board which on such consultation shall forward its views on
exemption to the appropriate Government within such time limit as may be
specified in the Scheme.
a) The provisions of sections 6, 7-A, 8 and 14-B shall, so far as may be, apply
to the employer of the exempted establishment in addition to such other
conditions as may be specified in the notification granting such exemption,
and where such employer contravenes, or makes default in complying with
any of the said provisions or conditions or any other provision of this Act, he
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shall be punishable under section 12 as if the said establishment had not

been exempted under the said clause (a);
b) The employer shall establish a Board of Trustees for the administration of
the Provident Fund consisting of such number of members as may be
specified in the Scheme;
c) The terms and conditions of service members of the Board of Trustees shall
be such as may be specified in the Scheme;
d) The Board of Trustees constituted under clause (b) shall,
2. Any Scheme may make provision for exemption of any person or class
persons employed in any establishment to which the Scheme applies from the
operation of all or any of the provisions of the Scheme, if such person or class
of person is entitled to benefits in the nature of Provident Fund, gratuity or
old age pension and such benefits, separately or jointly, are on the whole not
less favourable than the benefits provided under this Act or the Scheme:
Provided that no such exemption shall be granted in respect of a class of persons
unless the appropriate Government is of opinion that the majority of persons
constituting such class desire to continue to be entitled to such benefits.
3. Where in respect of any person or class of persons employed in an
establishment an exemption is granted under this section from the operation
of all or any of the provisions of any Scheme (whether such exemption has
been granted to the establishment wherein such person or class of persons is
employed or to the person or class of persons as such), the employer in
relation to such establishment,
a) Shall, in relation to the Provident Fund, pension and gratuity to which any
such person or class of persons is entitled, maintain such accounts, submit
such returns, make such investment, provide for such facilities for
inspection and pay such inspection charges, as the Central Government may
direct;
b) Shall not, at any time after the exemption, without the leave of the Central
Government, reduce the total quantum of benefits in the nature of pension,
gratuity or Provident Fund to which any such person or class or persons
was entitled at the time of the exemption.
4. Any exemption granted under this section may be cancelled by the authority
which granted it, by order in writing, if an employer fails to comply,
a) In the case of an exemption granted under sub-section (1), with any of the
conditions imposed under that sub-section or sub-section (1-A) or with any
of the provisions of sub-section (3);
 In the case of an exemption granted under sub-section (1-C), with any of the
conditions imposed under that sub-section; and
b) In the case of an exemption granted under sub-section (2-B), with any of the
provisions of sub-section (3-A).
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a. Transfer of accounts
1. Where an employee employed in an establishment to which this Act applies leaves his
employment and obtains re-employment in another establishment to which this Act
does not apply, the amount of accumulations to the credit of such employee in the
Fund, or as the case may be, in the Provident Fund of the establishment left by him
shall be transferred, within such time as may be specified by the Central
Government in this behalf, to the credit of his account in the Provident Fund of the
establishment in which he is re-employed, if the employee so desires and the rules in
relation to that Provident Fund permit such transfer.
2. Where an employee in establishment to which this Act does not apply leaves his
employment and obtains re-employment in another establishment to which this
Act applies, the amount of accumulations to the credit of such employee in the
Provident Fund of the establishment left by him may, if the employee so desires
and the rules in relation to such provident Fund permit, be transferred to the
credit of his account in the Fund or as the case may be, in the Provident Fund
of the establishment in which he is re-employed.
No suit, prosecution or other legal proceeding shall lie against the Central
Government, a State Government, the Presiding Officer of a Tribunal, any authority
referred to in section 7-A, an Inspector or any other person for anything which is in
good faith done or intended to be done in pursuance of this Act, the Scheme, the
Pension Scheme or the Insurance Scheme.
Delegation of powers
The appropriate Government may direct that any power of authority or
jurisdiction exercisable by it under this Act, the Scheme, the Pension Scheme or the
Insurance Scheme shall, in relation to such matters and subject to such
conditions, if any, as may be specified in the direction, be exercisable also,
a) Where the appropriate Government is the Central Government, by such officer
or authority subordinate to the Central Government or by the State
Government or by such officer or authority subordinate to the State
Government, as may be specified in the notification;
POWER TO MAKE RULES
1. The Central Government may, be notification in the Official Gazette, make
rules to carry out the provisions of this Act.
2. Without prejudice to the generality of the foregoing power, such rules may
provide for all or any of the following matters, namely,
a) The salary and allowances and other terms and conditions of service of the
Presiding Officer and the employees of a Tribunal;
b) The form and the manner in which, and the time within which, an appeal
shall be filed before a Tribunal and the fees payable for filing such appeal;
c) The manner of certifying the copy of the certificate, to be forwarded to the
Recovery Officer under sub-section (2) of section 8-C; and
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d) Any other matter, which has to be, or may be, prescribed by rules under this Act.
Power to remove difficulties
1. If any difficult arises in giving effect to the provisions of this Act, as amended
by the Employees’ Provident Funds and Miscellaneous Provisions
(Amendment) Act, 1988, the Central Government may, by order published in
the Official Gazette, make such provisions, not inconsistent with the
provisions of this Act as appear to it to be necessary or expedient for the
removal of the difficulty:
Provided that no such order shall be made after the expiry of a period of three years
from the date on which the said amendment Act receives the assent of the President.
2. Every order made under this section shall, as soon as may be after it is made,
be laid before each House of Parliament.
PAYMENT OF GRATUITY ACT - ESI
Gratuity is a kind of retirement benefit, like provident fund or pension. It is a
payment which is intended to help employee after his retirement whether the
retirement is the result of the rules of superannuation or of some physical
disability. The general principal underlying gratuity schemes is that by faithful
service over a long period the employee is entitled to claim a certain amount as
retirement benefit. Thus it is earned by an employee as a reward for long and
meritorious service.
The Payment of Gratuity Act, 1972, a long-awaited and progressive social
security measure, was passed by Parliament in August, 1972. The Act came into
force on 16th September, 1972. It was amended twice in 1984 and then in 1987.
The latest amended to the Act was made in 1998.
Prior to enactment of the Payment of Gratuity Act, 1972 there was no Central
Act to regulate the payment of gratuity.
Short title, extent, application and commencement
1. This Act may be called the payment of gratuity act, 1972.
2. It extends to the whole of India:
Provided that insofar as it relates to plantations of ports, it shall not extend to
the State of Jammu and Kashmir.
3. It shall apply to,
a) Every factory, mine, oilfield, plantation, port and railway company;
b) Every shop or establishment within the meaning of any law for the time
being in force in relation to shops and establishments in a State, in which
ten or more persons are employed, or were employed, on any day of the
preceding twelve months;
c) Such other establishments or class of establishments, in which ten or more
employees are employed, or were employed, on any day of the preceding
twelve months, as the Central Government may, by notification, specify in
this behalf.
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4. It shall come into force on such date as the Central Government may, by
notification appoint.
Definitions
In this Act, unless the context otherwise requires,
b) “appropriate Government” means,
i. In relation to an establishment,
a) Belonging to, or under the control of, the Central Government,
b) Having branches in more than one State,
c) Of a factory belonging to, or under the control of, the Central Government,
d) Of a major port, mine, oilfield or railway company, the Central Government,
ii. In any other case, the State Government;
c) “Completed year of service” means continuous service for one year;
d) “Continuous Service” means continuous service as defined in section 2-A;
e) “Controlling authority” means an authority appointed by the appropriate
Government under section (3);
f) “Employee” means any person (other than an apprentice) employed on wages, in
any establishment, factory, mine, oilfield, plantation, port, railway company or
shop, to do any skilled, semi-skilled, or unskilled, manual supervisory,
technical or clerical work, person is employed in a managerial or administrative
capacity, but does not include any such person who holds a post under the
Central Government or a State Government and is governed by any other Act or
by any rules providing for payment of gratuity.
g) “Employer” means, in relation to any establishment, factory, mine, oilfield,
plantation, port, railway company or shop,
i. Belonging to, or under the control of, the Central Government or a State
Government, a person or authority appointed by the appropriate Government
for the supervision and control of employees, or where no person or authority
has been so appointed, the head of the Ministry or the Department concerned,
ii. Belonging to, or under the control of, any local authority, the person
appointed by such authority for the supervision and control of employees or
where no persons has been 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, factory, mine , oilfield, plantation,
port, railway company or shop, and where the said affairs are entrusted to any
other person, whether called a manager, managing director or by any other name,
such person;
h) “Factory” has the meaning assigned to it clause (m) of section 2 of the Factories
Act, 1948 (63 of 1948);
i) “Family”, in relation to an employee, shall be deemed to consist of
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i. In the case of a male employee, 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,
ii. In the case of a female employee, 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:
j) “Retirement” means termination of the service of an employee otherwise than on
superannuation;
k) “Superannuation”, in relation to an employee, means the attainment by the
employee of such age as is fixed in the contract or conditions of service as the
age on attainment of which the employee shall vacate the employment;
l) “Wages” means all emoluments which are earned by an employee while on duty
or on leave in accordance with the terms and conditions of his employment and
which are paid or are payable to him in cash and includes dearness allowance
but does not include any bonus, commission, house rent allowance, overtime
wages and any other allowance.
Controlling authority
The appropriate Government may, by notification, appoint any officer to be a
controlling authority, who shall be responsible for the administration of this Act
and different controlling authorities may be appointed for different areas.
Payments of gratuity
1. Gratuity shall be payable to an employee on the termination of this employment
after he has rendered continuous service for not less than five years,-
a) On his superannuation, or
b) On his retirement or resignation, or
c) On his death or disablement due to accident or disease:
Provided that the completion of continuous service of five years shall not be
necessary where the termination of the employment of any employee is due
to death or disablement:
2. 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 fifteen days’ wages based
on the rate of wages last drawn by the employee concerned:
Provided that in the case of a piece-rated employee, daily wages shall be computed
on the average of the total wages received by him for a period of three months
immediately preceding the termination of his employment, and, for this purpose,
the wages paid for any overtime work shall not be taken into account:
Provided further that in the case of an employee who is employed in a seasonal
establishment and who is not so employed throughout the year, the employer shall
pay the gratuity at the rate of seven days’ wages for each season.
3. The amount of gratuity payable to an employee shall not exceed three lakhs and
fifty thousand rupees.
4. For the purposes of computing the gratuity payable to en employee who is
employed, after his disablement, on reduced wages, his wages for period preceding
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his disablement shall be taken to be the wages received by him during that period,
and his wages for the period subsequent to his disablement shall be taken to be
the wages as so reduced.
5. Nothing in this section shall affect the right of an employee to receive better terms
of gratuity under any award or agreement or contract with the employer.
6. Notwithstanding anything contained in sub-section (1),
a) The gratuity of an employee, whose services have been terminated for any
act, willful omission or negligence causing any damage or loss to, or
destruction of, property belonging to the employer, shall be forfeited to the
extent of the damage or loss so caused;
b) The gratuity payable to an employee may be wholly or partially forfeited-
i. If the services of such employee have been terminated for his riotous or
disorderly conduct or any other act of violence on his part, or
ii. If the services of such employee have been terminated for any act which
constitutes an offence involving moral turpitude, provided that such offence
is committed by him in the course of his employment.
Compulsory Insurance
1. With effect from such date as may be notified by the appropriate Government in
this behalf, very employer, other than an employer or an establishment belonging
to, or under the control of, the Central Government or a State Government, shall,
subject to the provisions of sub-section (2), obtain an insurance in the manner
prescribed, for his liability for payment towards the gratuity under this Act, from
the Life Insurance Corporation of India established under the Life Insurance
Corporation of India Act, 1956 (31 of 1956) or any other prescribed insurer:
Provided that different dates may be appointed for different establishments or for
different areas.
2. The appropriate Government may, subject to such conditions as may be
prescribed, exempt every employer who had already established an approved
gratuity fund in respect of his employees and who desires to continue such
arrangement, and every employer employing five hundred or more persons who
establishes an approved gratuity fund in the manner prescribed from the
provisions of sub-section (1).
3. For the purpose of effectively implementing the provisions of this section, every
employer shall within such time as may be prescribed get his establishment
registered with the controlling authority in the prescribed manner and no
employer shall be registered under the provisions of this section unless he has
taken an insurance referred to in sub-section (1), or has established an approved
gratuity fund referred to in sub-section (2).
4. The appropriate Government may, by notification, make rules to give effect to the
provisions of this section and such rules may provide for the composition of the
Board of Trustees of the approval gratuity payable to an employee from the Life
Insurance Corporation of India or any other insurer with whom an insurance has
been taken under sub-section (1), ors as the case may be, the Board of Trustees
of the approved gratuity fund.
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5. Where an employer fails to make any payment by way of premium to the

insurance referred to in sub-section (1) or by way of contribution to an approval
gratuity fund referred to in sub-section (2), he shall be liable to pay the amount of
gratuity due under this Act (including interest, if any, for delayed payments)
forthwith to the controlling authority.
6. Whoever contravenes the provisions of sub-section (5) shall be punishable with
fine a further may extend to ten thousand rupees and in the case of continuing
offence with a further fine which may extend to one thousand rupees for each day
during which the offence continues.
Power to exempt
1. The appropriate Government may, by notification, and subject to such conditions
as may be specified in the notification, exempt any establishment, factory, mine
oilfield, plantation, port, railway company or shop to which this Act applies from
the operation of the provisions of this Act if, in the opinion of the appropriate
Government, the employees in such establishment, factory, mine, oilfield,
plantation, port, railway company or shop are in receipt of gratuity or pensionary
benefits not less favourable than the benefits conferred under this Act.
2. The appropriate Government may, by specified in the notification, exempt any
employee or class of employees employed in any establishment, factory, mine,
oilfield, plantation, port, railway company or shop to which this Act applies from
the operation of the provisions of this Act, in the opinion of the appropriate
Government, such employee or class of employees are in receipt of gratuity or
pensionary benefits not less favourable than the benefits conferred under this Act.
3. A notification issued under sub-section (1) or sub-section (2) may be issued
retrospectively a date not earlier than the date of commencement of this Act, but
no such notification shall be issued so as to prejudicially affect the interests of
any person.
Nomination
1. Each employee, who has completed one year service, shall make, within such
time, in such form and in such manner, as may be prescribed, nomination for
the purpose of the second proviso to sub-section (1) of section 4.
2. An employee may, in his nomination, distribute the amount of gratuity payable to
him under this Act amongst more than one nominee.
3. 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 by such employee in favour of a person who is not a member of
his family, shall be void.
4. If a the time of making a nomination the employee has no family, the nomination
may be made in favour of any person or persons but if the employee
subsequently acquires a family, such nomination shall forthwith become invalid
and the employee shall make, within such time as may be prescribed, a fresh
nomination in favour of one or more members of his family.
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5. A nomination may, subject to the provisions of sub-sections (3) and (4), be

modified by an employee at any time, after giving to his employer a written notice
in such form and in such manner as may be prescribed, of his intention to do so.
6. If a nominee predeceases the employee, the interest of the nominee shall revert to
the employee who shall make a fresh nomination, in the prescribed form, in
respect of such interest.
7. Every nomination, fresh nomination or alternation of nomination, as the case
may be, shall be sent by the employee to his employer, who shall keep the same
in the safe custody.
Determination of the amount of gratuity
1. A person who is eligible for payment of gratuity under this Act or any person
authorized, in writing, to act on his behalf shall send a written application to the
employer, within such time and in such form, as may be prescribed, for payment of
such gratuity.
2. As soon as gratuity becomes payable, the employer shall, whether an application
referred to in sub-section (1) has been made or not, determine the amount of
gratuity and give notice in writing to the person to whom the gratuity is payable
and also the controlling authority specifying the amount of gratuity so determined.
3. The employer shall arrange to pay the amount of gratuity, within thirty days from
the date it becomes payable to the person to whom the gratuity is payable.
a) If there is any dispute as to the amount of gratuity payable to an employee
under this Act or as to the admissibility of any claim of, or in relation to, an
employee for payment of gratuity, or as to the person entitled to receive the
gratuity, the employer shall deposit with the controlling authority such
amount as he admits to be payable by him as gratuity.
b) Where there is a dispute with regard to any matter or matters specified in
clause (a), the employer or employee or any other person raising the dispute
may make an application to the controlling authority for deciding the
dispute.
c) The controlling authority shall, after due inquiry and after giving the parties
to the dispute a reasonable opportunity of the being heard, determine the
matter or matters in dispute and if, as a result of such inquiry any amount is
found to be payable to the employee, the controlling authority shall direct the
employer to pay such amount or, as the case may be, such amount as
reduced by the amount already deposited by the employer.
d) The controlling authority shall pay the amount deposited, including the excess
amount, if any, deposited by the employer, to the person entitled thereto.
e) As soon as may be after a deposit is made under clause (a), the controlling
authority shall pay the amount of the deposit,
i. To the applicant where he is employee; or
ii. Where the applicant is not the employee, to the nominee or, as the case may
be, the guardian of such nominee or heir of the employee if the controlling
authority is satisfied that there is no dispute as the right of the applicant to
receive the mount of gratuity.
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4. For the purpose of conducting an inquiry under sub-section (4), the controlling
authority shall have the same powers as are vested in a Court, while trying a suit,
under the Code of Civil Procedure, 1908 (5 of 1908), in respect of the following
matters, namely:-
a) Enforcing the attendance of any person or examining him on oath;
b) Requiring the discovery and production of documents;
c) Receiving evidence on affidavits;
d) Issuing commissions for the examination of witnesses.
5. Any inquiry under this section shall be a judicial proceeding within the meaning of
sections 193 and 228, and for the purpose of section 196, of the Indian Penal Code
(45 of 1860).
6. Any person aggrieved by an order under sub-section (4) may, within sixty days
from the date of the receipt of the order, prefer an appeal to the appropriate
Government or such other authority as may be specified by the appropriate
Government in this behalf:
Provided that the appropriate Government or the appellate authority, as the case
may be, may, if it is satisfied that the appellant was prevented by sufficient cause
from preferring the appeal within the said period of sixty days, extend the said
period by a further period sixty days.
7. The appropriate Government or the appellate authority, as the case may be, may
after giving the parties to the appeal a reasonable opportunity of being heard,
confirm, modify or reverse the decision of the controlling authority.
Inspectors
1. The appropriate Government may, by notification, appoint as many Inspectors,
as it deems fit, for the purposes of this Act.
2. The appropriate Government may, by general or special order, define the area to
which the authority on an Inspector so appointed shall extended and where two
or more Inspectors are appointed for the same area, also provide, by such order,
for the distribution or allocation of work to be performed by them under this Act.
3. Every Inspector shall be deemed to be a public servant within the meaning of
section 21 of the Indian Penal Code (45 of 1860).
Powers of Inspectors
1. Subject to any rules made by the appropriate Government in this behalf, an
Inspector may, for the purpose of ascertaining whether any of the provisions of this
Act or the conditions, if any, of any exemption granted there under, have been
complied with, exercise all or any of the following powers, namely:
a) Require an employer to furnish such information as he may consider
necessary;
b) Enter and inspect, at all reasonable hours, with such assistant (if any), being
persons in the service of the Government or local or any public authority, as he
thinks fit, any premises of or place in any factory mine, oilfield, plantation, port,
railway company, shop or other establishment to which this Act, applies, for the
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purpose of examining any register, record or notice or other document required

to be kept or exhibited under this Act or the rules made there under, or
otherwise kept exhibited in relation to the employment of any person or the
payment of gratuity to the employees, and require the production thereof for
inspection;
c) Examine with respect to any matter relevant to any of the purposes
aforesaid, the employer or any person whom he finds in such premises or
place and who, he has reasonable cause to believe, is an employee employed
therein;
d) Make copies of, or take extracts from, any register, record, notice or other
document, as he may consider relevant, and where he has reason to believe
that any offence under this Act has been committed by an employer, search
and seize with such assistance as he may think fit, such register, record,
notice or other document as he may consider relevant in respect of that
offence;
e) Exercise such other powers as may be prescribed.
2. Any person required to produce any register, record, notice or other document or to
give any information by an Inspector under sub-section (1) shall be deemed to be
legally bound to do so within the meaning of sections 175 and 176 of the Indian
Penal code (45 of 1860).
3. The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) shall so far as
may be, apply to any search or seizure under this section as they apply to any
search or seizure made under the authority of a warrant issued under section 94 of
that Code.
Recovery of gratuity
If the amount of gratuity payable under this Act is not paid by the employer,
within the prescribed time, to the person entitled thereto, the controlling authority
shall, on an application made to it in this behalf by the aggrieved person, issue a
certificate for that amount to the Collector, who shall recover the same, together with
compound interest thereon at such rate as the Central Government may, by
notification, specify, from the date of expiry of the prescribed time, as arrears of land
revenue and pay the same to the person entitled thereto:
Provided that the controlling authority shall, before issuing a certificate under this
section, give the employer a reasonable opportunity of showing cause against the issue
of such certificate:
Provided further that the amount interest payable under this section shall, in no
case exceed the amount of gratuity payable under this Act.
Penalties
1. Whoever, for the purpose of avoiding any payment to be made by himself under
this Act or of enabling any other person to avoid 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 which may extend to ten thousand rupees or with both.
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2. An employer who contravenes, or makes default in complying with, array of the

provisions of this Act or any rule or order made there under shall be punishable
with imprisonment for a term which shall not be less than three months but which
may extend to one year, or with fine which shall not be less than ten thousand
rupees but which may extend to twenty thousand rupees, or with both:
Provided that where the offence relates to non-payment of any gratuity payable
under this Act, the employer shall be punishable with imprisonment a term which
shall not be less than six months but which may extend to two years unless Court
trying the offence, for reasons to be recorded by it in writing, is of opinion that
lesser term of imprisonment or the imposition of a fine would meet the ends of
justice.
Exemption of employer from liability in certain cases
Where an employer is charged with an offence punishable under this Act, he shall
be entitled, upon complaint duly made by him and on giving to the complainant
duly made by him and on giving to the complaint not less than three clear days’
notice in writing of his intention to dos o, to have any other person whom he
charges as the actual offender brought before the Court at the time appointed for
hearing the charge; and if, after the commission of the offence has been proved, the
employer p[roves to the satisfaction of the Court,
a) That he has used due diligence to enforce the execution of this Act, and
b) That the said other person committed the offence in question without his
knowledge, consent or connivance, that other person shall be convicted of the
offence and shall be liable to the like punishment as if he were the employer and
the employer shall be discharged from and liability under this Act in respect of
such offence:
Provided that in seeking to prove as aforesaid, the employer may be examined on
oath and his evidence and that of any witness whom he calls in his support shall
be subject to cross-examination on behalf of the person he charges as the actual
offender and by the prosecutor:
Provided further that, if the person charged as the actual offender by the employer
cannot be brought before the Court at the time appointed for hearing the charge, the
Court shall adjourn the hearing from time to time for a period not exceeding three
months and if by the end of the said period the person charged as the actual offender
cannot still be brought before the Court, the Court shall proceed to hear the charge
against the employer and shall, if the offence be proved, convict the employer.
Cognizance of offences
1. No Court shall take cognizance of any offence punishable under this Act save on a
complaint made by or under the authority of the appropriate Government:
Provided that where the amount of gratuity has not been paid, or recovered,
within six months from the expiry of the prescribed time, the appropriate
Government shall authorize the controlling authority to make a complaint
against the employer, whereupon the controlling authority shall, within fifteen
days from the date of such authorization, make such complaint to a Magistrate
having jurisdiction to try the offence.
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2. No Court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the

first class shall try any offence punishable under this Act.
No suit or other legal proceeding shall lie against the controlling authority or
any other person in respect of anything which is in good faith done or intended to
be done under this Act or any rule order made there under.
Protection of gratuity
No gratuity payable under this Act and no gratuity payable to an employee
employed in any establishment, factory, mine, oilfield, plantation, port, railway
company or shop exempted under section 5 shall be liable to attachment in
execution of any decree or order of any civil, revenue or criminal Court.
Act to override other enactments, etc
The provisions of this Act or any rule made there under shall have effect
notwithstanding anything inconsistent therewith contained in any enactment other
than this Act or in any instrument or contract having effect by virtue of any
enactment other than this Act.
Power to make rules
1. The appropriate Government may, by notification, make rules for the purpose of
carrying out the provisions of this Act.
2. Every rule made by the Central Government under this act shall be laid, as soon as
may be after it is made, before each House of parliament while it is in session, for a
total period of thirty days which may be comprised in one session or in two or more
successive sessions, and it, before the expiry of the session immediately following
the session or the successive sessions aforesaid, both House agree in making any
modification in the rule or both House agree that the rule should not be made, the
rule shall, thereafter, have effect only in such modified form or be of no effect, as
the case may be; so, however, that any such modification or annulment shall be
without prejudice to the validity of anything previously done under that rule.
Summary
The umbrella legislation relating to gratuity in the Payment of Gratuity Act, 1972.
The Act was enacted to provide for a scheme for the payment of gratuity to employees
engaged in factories, mines, oilfields, plantation, ports, railway companies, shops or
other establishments employing ten or more persons and for matters connected
therewith or incidental thereto. The appropriate Government may, by notification, and
subject to such conditions as may be specified in the notification, exempt any
establishment to which this Act applies or any employee or class of employees
employed therein, from the operation of the provisions of this Act, if in the opinion of
the appropriate Government, the employees in such establishment are in receipt of
gratuity or pensioner benefits not less favourable than the benefits conferred under
this Act.
The Act is administered by the Central Government in:- (i) establishments
which are under its control; (ii) establishments having branches in more than one
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State; and (iii) major ports, mines, oil fields and the railways. The appropriate
Government may, by notification, appoint any officer to be a controlling authority,
who shall be responsible for the administration of this Act and different controlling
authorities may be appointed for different areas.
The Employees State Insurance Act 1948
Statement of objects and reasons
1. The introduction of a scheme of Health Insurance for industrial workers has been
under the consideration of the Government of India for a long time. The necessity
for such a scheme has become more urgent in view of the conditions brought
about by war. The scheme envisaged as one of compulsory State Insurance
providing for certain benefits in the event of sickness, maternity and employment
injury to workmen employed in or in connection with the work in factories other
than seasonal factories.
2. A scheme of this nature has to be planned on all-India basis and administered
uniformly throughout the country. With this object, the administration of the
scheme is proposed to be entrusted to a Corporation constituted by central
legislation.
3. The functions of the Corporation will be performed by a Central Board constituted
of representatives of Central and Provincial Governments, and of employers,
workers and the medical profession. The board will also include certain members
elected the Central Legislative Assembly. A standing Committee of the board will
act as the Executive of the board, and Medical Benefit council will also be set up to
advise on matters relating to the administration of Medical benefit.
4. The insurance fund will be mainly derived from contributions from employers
and workmen. The contributions payable in respect of each workers will be based
on his average wages and will be based on his average wages and will be payable
in the first instance by the employer. The employer will be entitled to recover the
workman’s share from the wages of the workmen concerned. Workmen whose
earnings do not exceed 10 annas a day will be totally exempt from payment of
any share of the contribution on account of such workmen being met by the
employer. Provision has been made for the preparation of proper budgets and the
audit of accounts.
5. The insured workmen will be entitled to the following benefits:
a) Sickness Cash Benefit A workman, if certified sick and incapable of
working, will receive for a period of not exceeding 8 weeks in any
continuous 12 monthly period, a cash allowance equal approximately to
half average daily wages during the previous six months. He will also
entitled to receive medical care and treatment at such hospitals,
dispensaries or other institutions to which the factory in which he is
employed may be allotted.
b) Maternity Benefit Women workers will be entitled to receive a maternity
benefit at 12 annas a day for 12 weeks. They will also be entitled to medical
aid at the aforesaid medical institutions.
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c) Disablement and Dependent’s Benefit A workman disabled by

employment injury will receive for the period of disablement or life
depending on whether the disablement is temporary or full and permanent
as the case may be, subject to a maximum and minimum. Where
disablement is partial, the pension will be proportionately reduced. In case
of death resulting from employment injury, the pension will be payable to
the widow and legitimate children, to other dependants of the deceased
workman. The workman will also be entitled to medical care and treatment.
6. Medical care and treatment to insured workman will be provided by Provincial
Government at such hospitals, dispensaries and other institutions as may be
prescribed for the purpose. The cost of the medical benefit will be shared between
the Provincial Government and the Corporation in such proportions as may be
agreed upon between them. In case the average incidence of sickness cash benefit
in any Province is in excess of the all-India average, Provincial Government will
also bear such share of the cost of the excess incidence as may be agreed upon
between it and the Corporation.
7. Workmen’s State Insurance Courts will be set up to decide disputes and
adjudicate on claims. The cost of the tribunal will be paid by the insurance fund.
PRELIMINARY
Short title, extent, commencement and application
1. This Act may be called THE EMPLOYEES’ STATE INSURANCE ACT, 1948.
3. It shall come into force on such date or dates as the Central Government may,
by notification in the Official Gazette, appoint, and different dates may be
appointed for different provisions of this Act and for different States or for
different parts thereof.
4. It shall apply, in the first instance, to all factories (including factories
belonging to the Government) other than seasonal factories:
Definitions
In this Act, unless there is anything repugnant in the subject or context,
1. “Appropriate Government” means, in respect of establishments under the control of
the Central Government or a railway administration or a major port or a mine or
oil-field, the Central Government, and in all other cases, the State Government;
2. “Confinement” means labour resulting in the issue of a living child, or labour after
twenty-six weeks of pregnancy resulting in the issue of a child whether alive or dead;
3. “Contribution” means the sum of money payable to the Corporation by the
principal employer in respect of an employee and includes any amount payable by
or on behalf of the employee in accordance with the provisions of this Act;
4. “Corporation” means the Employees’ State Insurance Corporation set up under
this Act;
a. “Dependant” means any of the following relatives of a deceased insured
person, namely:-
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i. a widow, a minor legitimate or adopted son, an unmarried legitimate or

adopted daughter;
 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 eighteen years and is infirm;
iii. if wholly or in part dependant on 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 if a minor,
d) a daughter-in-law,
e) 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-parent if no parent of the insured person is alive;
5. “Duly appointed” means appointed in accordance with the provisions of this Act or
with the rules or regulations made there under;
6. “Employment injury” means a personal injury to an employee caused by accident
or an occupational disease arising out of and in the course of this employment,
being an insurable employment, whether the accident occurs or the occupational
disease is contracted within or outside the territorial limits of India;
7. “Employee” means 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 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 on in
or incidental 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 let on
hire has entered into a contract of service;
8. “Exempted employee” means an employee who is not liable under this Act to pay
the employee’s contribution;
9. “Family” means all or any of the following relatives of an insured person, namely:
i) a spouse;
ii) a minor legitimate or adopted child dependent upon the insured person;
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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) an unmarried 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) dependent parents;
10. “Factory” means any premises including the precincts thereof,
a) whereon ten or more persons are employed or were employed for wages on
any day of the preceding twelve months, and in any part of which a
manufacturing process is being carried on with the aid of power or is
ordinarily so carried on, or
b) whereon twenty or more persons are employed or were employed for wages
on any day of the preceding twelve months, and in any part of which a
manufacturing process is being carried on without the aid of power or is
ordinarily so carried on, but does not include a mine subject to the
operation of the Mines Act, 1952 (35 of 1952) or a railway running shed;
11. “Immediate employer”, in relation to employee employed by or through him, means
a person who has undertaken the execution, on the premises of a factory or an
establishment to which this Act applies or under the supervision of the principal
employer or his agent, of the whole or any part of any work which is ordinarily part
of the work of the factory or establishment of the principal employer or is
preliminary to the work carried o in, or incidental to the purpose of, any such
factory or establishment, and includes a person by whom the eservices of an
employee who has entered into a contract of service with him are temporarily lent
or let on hire to the principal employer and includes a contractor;
a) “insurable employment” means an employment in a factory or establishment to
which this Act applies;
12. “Insured person” means a person who is or was an employee in respect of whom
contributions are or were payable under this Act and who is, by reason thereof,
entitled to any of the benefits provided by this Act;
a) “managing agent” means 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;
i) “manufacturing process” shall have the meaning assigned to it in the
Factories Act, 1948 (63 of 1948);
b) “miscarriage” means 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);
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13. “Occupier” of the factory shall have the meaning assigned to it in the Factories Act,
1948 (63 of 1948);
a) “permanent partial disablement” means such disablement of a permanent
nature, as reduces the earning capacity of an employee in every
employment which he was capable of undertaking at the time of the
accident resulting in the disablement;
b) “permanent total disablement” means 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:
Provided that permanent total disablement shall be deemed to result from every
injury specified in Part I of the Second Schedule on from any combination of
injuries specified in Part II thereof where the aggregate percentage of the loss of
earning capacity, as specified in the said Part II against those injuries, amounts to
one hundred per cent. or more;
c) “power” shall have the meaning assigned to it in the Factories Act, 1948 (63
of 1948);
14. “prescribed” means prescribed by rules made under this Act;
15. “principal employer” means-
i) in a factory, the owner or occupier of the factory and includes the managing
agent of such owner or occupier, the legal representative of a deceased owner
or occupier, and where a person has been named as the manager of the
factory under the Factories Act, 1948 (63 of 1948), the person so named;
ii) in any establishment under the control of any department of any
<
Government in India, the authority appointed by such Government in this

behalf or where no authority is so appointed, the head of the Department;
iii) in any other establishment, any person responsible for the supervision and
control of the establishment;
16. “regulation” means a regulation made by the Corporation;
17. “Schedule” means a Schedule to this Act;
i) “seasonal factory” means a factory which is exclusively engaged in one or
more of the following manufacturing process, namely, cotton ginning,
cotton or jute pressing, decortications of groundnuts, the manufacture of
coffee, indigo, rubber, sugar or tea or any manufacturing process which is
incidental to or connected with any of the aforesaid process and includes a
factory which is engaged for a period not exceeding seven months in a year,
ii) in any process of blending, packing or repacking of tea or coffee; or
iii) in such other manufacturing process as the Central Government may, by
notification in the Official Gazette, specify;
18. “sickness” means a condition which requires medical treatment and attendance
and necessitates abstention from work on medical grounds;
19. “temporary disablement” means a condition resulting from an employment injury
which requires medical treatment and renders an employee, as a result of such
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injury, temporarily incapable of doing the work which he was doing prior to or at
the time of the injury;
20. “wages” means all remuneration paid or payable, in cash to an employee, if the
terms of the contract of employment, express or implied, were fulfilled and includes
any payment to an employee in respect of any period of authroised leave, lock-out,
strike which is not illegal or lay-off and other additional remuneration, if any paid
at intervals not exceeding two months, but does not include-
a) any contribution paid by the employer to any pension fund or provident
fund, or under this Act;
b) any travelling allowance or the value of any travelling concession;
c) any sum paid to the person employed to defray special expenses entailed on
him by the nature of his employment; or
d) any gratuity payable on discharge;
21. “wage period” in relation to an employee means the period in respect of which
wages are ordinarily payable to him whether in terms of the contract of
employment, express or implied or otherwise;
Corporation, standing committee and medical benefit council
Establishment of Employees’ State Insurance Corporation
1. With effect from such date as the Central Government may, by notification in
the Official Gazette, 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 appointed by the Central Government;
c) 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;
e) 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 organizations of employers as may be recognized for
the purpose by the Central Government;
g) ten persons representing employees to be appointed by the Central Government
in consultation with such organizations of employees as may be recognized for
the purpose by the Central Government;
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h) two persons representing the medical profession to be appointed by the Central

Government in consultation with such organizations of medical practitioners as
may be recognized for the purpose by the Central Government;
i) three members of Parliament of whom two shall be members of the House of the
People (Lok Sabha) and one shall be a member of the Council of States (Rajya
Sabha) elected respectively by the member 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, constituted from among its members, consisting of
a) a Chairman, appointed by the Central Government;
b) three members of the Corporation, appointed by the Central Government;
 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 the among the members of the Corporation representing
the medical profession; and
iv) one member from among the members of the Corporation elected by
Parliament;
v) the Director-General of the Corporation, ex officio.
Term of office of members of Standing Committee
1. Save as otherwise expressly provided in this Act, the term of office of a member of
the Standing Committee, other than a member referred to in clause (a) or clause (b)
or clause (bb) of section 8, shall be two years from the date on which his election is
notified:
Provided that a member of the Standing Committee shall, notwithstanding the
expiry of the said period of two years, continue to hold office until the election of
this successors is notified:
Provided further that a member of the Standing Committee shall cease to hold
office when he ceases to be a member of the Corporation.
2. A member of the Standing Committee referred to in clause (a) or clause (b) or
clause (bb) of section 8 shall hold office during the pleasure of the Central
Government.
Medical Benefit Council
1. The Central Government shall constitute a Medical Benefit Council consisting of,
a) the Director General, Health Services, ex officio, as Chairman;
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b) a Deputy Director General, Health Services, to be appointed by the

Central Government;
c) the Medical Commissioner of the Corporation, ex officio;
d) one member each representing each of the States (other than Union
territories) in which this Act is in force to be appointed by the State
Government concerned;
e) three members representing employers to be appointed by the Central
Government in consultation with such organizations of employers as may
be recognized for the purpose by the Central Government;
f) three members representing employees to be appointed by the Central
Government in consultation with such organization of employees as may
be recognized for the purpose by the Central Government; and
g) three members, of whom not less than one shall be a woman,
representing the medical profession, to be appointed by the Central
Government in consultation with such organizations of medical
practitioners as may be recognized for the purpose by the Central
Government.
2. Save as otherwise expressly provided in this Act, the term of office of a member of
the Medical Benefit Council, other than a member referred to in any of the
clauses (a) to (d) of sub-section (1), shall be four years from the date on which his
appointment is notified:
3. A member of the Medical Benefit Council referred to in clauses (b) and (d) of sub-
section (1), shall hold office during the pleasure of the Government appointing
him.
Resignation of membership
A member of the Corporation, the Standing Committee, of the Medical Benefit
Council may resign his office by notice in writing to the Central Government and
his seat shall fall vacant on the acceptance of the resignation by that Government.
Cessation of membership
1. A member of the Corporation; the Standing Committee, or the Medical benefit
Council shall cease to be a member of that if he fails to attend three consecutive
meetings thereof;
2. Provided that the Corporation, the Standing Committee or the Medical Benefit
Council, as the case may be, may, subject to rules made by the Central
Government in this behalf, restore him to membership.
Disqualification
A person shall be disqualified for being chosen as or for being a member of the
Corporation, the Standing Committee or the Medical Benefit Council-
a) if he is declared to be of unsound mind by a competent Court; or
b) if he is an undercharged insolvent; or
c) if he has directly or indirectly by himself or by his partner any interest in a
subsisting contract with, or any work being done for, the Corporation except
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as a medical practitioner or as a shareholder (not being a Director) of a

company; or
d) if before or after the commencement of this Act, he has been convicted of an
offence involving moral turpitude.
Filling of vacancies
1. Vacancies in the office of appointed or elected members of the Corporation,
the Standing Committee and the Medical Benefit Council shall be filled by
appointment or election, as the case may be.
2. A member of the Corporation, the Standing Committee or the Medical Benefit
Council appointed or elected to fill a casual vacancy shall hold office only so
long as the member in whose place he is appointed or elected would have been
entitled to hold office if the vacancy had not occurred.
Fees and allowances
Members of the Corporation, the Standing Committee and the Medical Benefit
Council Benefit Council shall receive such fees and allowances as may from time to
time be prescribed by the Central Government.
Powers of the Standing Committee
1. Subject to the general superintendence and control of the Corporation, the
Standing Committee shall administer the affairs of the Corporation and may
exercise any of the powers and perform any of the functions of the
Corporation.
2. The Standing Committee shall submit for the consideration and decision of the
Corporation all such cases and matters as may be specified in the regulations
made in this behalf.
3. The Standing Committee may, in its discretion, submit any other case or
matter for the decision of the Corporation.
Duties of Medical Benefit Council
The Medical Benefit Council shall,
a) advice the Corporation and the Standing Committee on matters relating to
the administration of medical benefit, the certification for purposes of the
grant of benefits and other connecter matters;
b) have such powers and duties of investigation as may be prescribed in
relation to complaints against medical practitioners in connection with
medical treatment and attendance; and
c) perform such other duties in connection with medical treatment and
attendance as may be specified in the regulations.
Finance and audit
Employees’ State Insurance Fund
1. All contribution paid under this Act and all other moneys received on behalf of
the Corporation shall be paid into a Fund called the Employees’ State
Insurance Fund which shall be held and administered by the Corporation for
the purposes of this Act.
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2. The Corporation may accept grants, donations and gifts from the Central or
any State Government, local authority, or any individual or body whether
incorporated or not, for all or any of the purposes of this Act.
3. Subject to the other provisions contained in this Act and to any rules or
regulations made in this behalf, all moneys accruing or payable to the said
Fund shall be paid into the Reserve Bank of India or such other bank as may
be approved by the Central Government to the credit of an account styled the
account of the Employees’ State Insurance Fund.
4. Such account shall be operated on by such officers as may be authorised by
the Standing Committee with the approval of the Corporation.
Budget estimates
The Corporation shall in each year frame a budget showing the probable
receipts and the expenditure which it proposes to incur during the following year
and shall submit a copy of the budget for the approval of the Central Government
before such date as may fixed by it in that behalf. The budget shall contain
provisions adequate in the opinion of the Central Government for the discharge of
the liabilities incurred by the Corporation and for the maintenance of a working
balance.
Accounts
The corporation shall maintain correct accounts of its income and expenditure in
such form and in such manner as may be prescribed by the Central Government.
Audit
1. The accounts of the Corporation shall be audited annually by the Comptroller
and Auditor-General of India and any expenditure incurred by him in
connection with such audit shall be payable by the Corporation to the
Comptroller and Auditor-General of India.
2. The Comptroller and Auditor-India and any person appointed by him in
connection with the audit of the accounts of the Corporation shall have the
same rights and privileges and authority in connection with such audit as the
Comptroller and Auditor-General has, in connection with the audit of
Government accounts and, in particular, shall have the right to demand the
production of books, accounts, connected vouchers and other documents and
papers and to inspect any of the officers of the Corporation.
3. The accounts of the Corporation as certified by the Comptroller and Auditor-
General of India or any other person appointed by him in this behalf together
with the audit report thereon shall be forwarded to the Corporation which
shall forward the Central Government along with its comments on the report
of the Comptroller and Auditor-General.
Annual report
The corporation shall submit to the Central Government an annual report its
work and activities.
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Budget, audited accounts and the annual report to be placed before Parliament
The annual report, the audited accounts of the Corporation, together with the
report of the Comptroller and Auditor-General of India thereon and the comments
of the Corporation on such report under section 34 and the budget as finally
adopted by the Corporation shall be placed before Parliament.
Valuation of assets and liabilities
The Corporation shall, at intervals of five years, have a valuation of its assets
and liabilities made by a valuer appointed with the approval of the Central
Government:
Provided that it shall be open to the Central Government to direct a valuation
to be made at such other times as it may consider necessary.
Contributions
Method of payment of contribution
Subject to the provisions of this Act, the Corporation may make regulations for
any matter relating or incidental to the payment and collection of contributions
payable under this Act and without prejudice to the generality of the foregoing
power such regulations may provide for,
a) the manner and time of payment of contributions;
b) the payment of contributions by means of adhesive or other stamps affixed to or
impressed upon books, cards or otherwise and regulating manner, times and
conditions in, at and under which, such stamps are to be affixed or impressed;
c) the entry in or upon books or cards of particulars of contributions paid and
benefits distributed in the case of the insured persons to whom such books or
cards, relate; and
d) the issue, sale custody, production, inspection and delivery of books or cards and
the replacement of books or cards which have been lost, destroyed or defected.
Employers to furnish returns and maintain registers in certain cases
1. Every principal and immediate employer shall submit to the Corporation or to
such officer of the Corporation as it may direct such returns in such form and
containing such particulars relating to persons employed by him or to any
factory or establishment in respect of which he is the principal or immediate
employer as may be specified in regulations made in this behalf.
2. Where in respect of any factory or establishment the Corporation has reason to
believe that a return should have been submitted under sub-section (1) but has
not been so submitted, the Corporation may require any person in charge of the
factory or establishment to furnish such particulars as it may consider
necessary for the purpose of enabling the Corporation to decide whether the
factory or establishment is a factory or establishment to which this Act applies.
3. Every principal and immediate employer shall maintain such registers pr
records in respect of his factory or establishment as may be required by
regulations made in this behalf.
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Inspectors, their functions and duties

1. The Corporation may appoint such persons as Inspectors, as it thinks fit, for the
purposes of this Act, within such local limits as it may assign to them.
2. Any Inspector appointed by the Corporation under sub-section (1) (hereinafter
referred to as Inspector), or other official of the Corporation authorized in this
behalf by it, may, for the purposes of enquiring into the correctness of any of the
particulars stated in any return referred to in section 44 or for the purpose of
ascertaining whether any of the provisions of this Act has been complied with-
3. Every principal and immediate employer shall maintain such registers or
records in respect of his factory or establishment as may be required by
regulations made in this behalf.
Inspectors, their functions and duties
1. The Corporation may appoint such persons as Inspectors, as it thinks fit, for
the purposes of this Act, within such local limits as it may assign to them.
2. Any Inspector appointed by the Corporation authorized in this behalf by it,
may, for the purposes of enquiring into the correctness of any of the particulars
stated in any return referred to in section 44 or for the purpose of ascertaining
whether any of the provisions of this Act has been complied with-
a) require any principal or immediate employer to furnish to him such
information as he may consider necessary for the purposes of this Act; or
b) at any reasonable time enter any office, establishment, factory or other
premises occupied by such principal or immediate employer and require
any person found in charge thereof to produce to such Inspector or other
official and allow him to examine such accounts, books and other
documents relating to the employment of persons and payment of wages or
to furnish to him such information as he may consider necessary; or
c) examine with respect to any matter relevant to the purposes aforesaid, the
principal or immediate employer, his agent or servant, or any person found
in such factory, establishment, office or other premises, or any person
whom they said Inspector or other official has reasonable cause to believe
to be or to have been an employee;
d) make copies of, or take extracts from, any register, account book or other
document maintained in such factory, establishment, office or other
premises;
e) exercise such other powers as may be prescribed.
3. An Inspector such shall exercise such functions and perform such duties as
may be authorised by the Corporation or as may be specified in the
regulations.
Benefits
1. Subject to the provisions of this Act, the insured persons their dependants or
the persons hereinafter mentioned, as the case may be, shall be entitled to the
following benefits, namely,
235
a) periodical payments to any insured person in case of his sickness certified

by a duly appointed medical practitioner or by any other person
possessing such qualifications and experience as the Corporation may, by
regulation, specify in this behalf (hereinafter referred to as sickness
benefit);
b) periodical payments to an insured woman in case confinement or
miscarriage or sickness arising out of pregnancy, confinement, premature
birth of child or miscarriage, such woman being certified to be eligible for
such payments by an authority specified in this behalf by the regulations
(hereinafter referred to as maternity benefit);
c) periodical payments to an insured person suffering from disablement as a
result of an employment injury sustained as an employee under this Act
and certified to be eligible for such payment by an authority specified in
this behalf by the regulations (hereinafter referred to as disablement
benefit);
d) periodical payments to such dependants of an insured person who dies as
a result of an employment injury sustained as an employee under this Act,
as are entitled to compensation under this Act (hereinafter referred to as
dependants benefits);
e) medical treatment for and attendance on insured persons (hereinafter
referred to as medical benefit);
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
Subject to the provisions of this Act,
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 sustain permanent disablement, whether total or partial,
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.
236
a. Presumption as to accident arising course of employment

For the purposes of this Act, an accident arising in the course of an insured
person’s employment shall be presumed, in the absence of evidence to the contrary,
also to have arisen out of that employment.
b. Accidents happening while acting in breach of regulations, etc.
An accident shall be deemed to arise out of and in the course of an insured
person’s employment notwithstanding that he is at the time of the accident acting
in contravention of the provisions of any law applicable to him, or of any orders
given by or on behalf of his employer or that he is acting without instructions from
his employer, if-
a) the accident would have been deemed so to have arisen had the act not been
done in contravention as aforesaid or without instructions from his
employer, as the case may be; and
b) the act is done for the purpose of and in connection with the employer’s
trade or business.
c. Accidents happening while travelling in employer’s transport.
1. An accident happening while an insured person is, with the express or implied
permission of his employer, travelling as a passenger by any vehicle to or from his
place of work shall, notwithstanding that he is under no obligation to his employer
to travel by that vehicle, be deemed to arise out of and in the course of his
employment, if-
a) the accident would have been deemed so to have arisen had he been under
such obligation; and
b) at the time of the accident, the vehicle-
i) is being operated by or on behalf of his employer or some other person by
whom it is provided in pursuance of arrangements made with his
employer, and
ii) is not being operated in the ordinary course of public transport service.
2. In this section “vehicle” includes a vessel and an aircraft.
d. Accidents happening while meeting emergency
An accident happening to an insured person in or about any premises at
which he is for the time being employed for the purpose of his employer’s trade or
business shall be deemed to arise out of and in the course of his employment, if it
happens while he is taking steps, on an actual or supposed emergency at those
premises, rescue, succour or protect persons who are, or are thought to be or
possibly to be, injured or imperiled, or to avert or minimize serious damage to
property.
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) dependant’s benefit
shall be payable at such rate and for such periods and subject to such conditions
237
as may be prescribed by the Central Government to his dependants specified in

sub-clause (i), sub-clause (i-a) and sub clause (ii) of clause (6-A) 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.
a. Occupational disease
1. If an employee employed in any employment specified in Part A of the Third
Schedule contracts any disease specified therein as an occupational disease
peculiar to hat employment, or if an employee employed in the employment
specified in Part B of that Schedule for continuous period of not less than six
months contracts any disease specified therein as an occupational disease peculiar
to that employment or if an employee employed in any employment specified in
Part C of that Schedule for such continuous period as the Corporation may specify
in respect of each employment, contracts any disease specified therein as an
occupational disease peculiar to that employment, the contracting of the disease
shall, unless contrary is proved, be deemed to be an “employment injury” arising
out of and in the course of employment.
i) Where the Central Government or a State Government, as the case may be, adds
any description of employment to the employments specified in Schedule III to
the Workmen’s Compensation Act, 1923 (8 of 1923), by virtue of the powers
vested in it under sub-section (3) of section 3 of the said Act, the said
description of employment and the occupational diseases specified under that
sub-section as peculiar to that description of employment shall be deemed to
form part of the Third Schedule.
ii) Without prejudice to the provisions of clause (i), the Corporation after giving, by
notification in the Official Gazette, not less than three months’ notice of its
intention so to do, may by a like notification, add any description of
employment to the employments specified in the Third Schedule and shall
specify the case of employments so added to diseases peculiar to those
employments respectively and thereupon the provisions of this Act shall apply,
as if such diseases had been declared by this Act to be occupational diseases
peculiar to those employments.
2. Save as provided by sub-sections (1) and (2), no benefit shall be payable to an
employee in respect of any disease unless the disease is directly attributable to a
specific injury by accident arising out of an in the course of his employment.
Medical benefit
1. An insured person or (where such medical benefit is extended to his family) a
member of his family whose condition requires medical treatment and attendance
shall be entitled to receive medical benefit.
2. Such medical benefit may be given either in the form of out-patient treatment and
attendance in a hospital or dispensary, clinic or other institution or by visits to the
home of the insured person or treatment as in-patient in a hospital or other
institution.
238
3. A person shall be entitled to medical benefit during any period for which
contributions are payable in respect of him or in which he is qualified to claim
sickness benefit or maternity benefit or is in receipt of such disablement benefit as
does not disentitle him to medical benefit under the regulations:
Provided that a person in respect of whom contribution ceases to be payable
under this Act may be allowed medical benefit for such period and of such nature
as may be provided under the regulations:
Provided further that an insured person who ceases to be in insurable
employment on account of permanent disablement shall continue, subject to
payment of contribution and such other conditions as may be prescribed by the
Central government, to receive medical benefit till the date on which he would
have vacated the employment on attaining the age of superannuation had he not
sustained such permanent disablement:
Provided also that an insured person, who has attained the age of superannuation,
and his spouse shall be eligible to receive medical benefit subject to payment of
contribution and such other conditions as may be prescribed by the Central
Government.
Scale of medical benefit
1. An insured person and (where such medical benefit is extended to his family) his
family shall be entitled to receive medical benefit only of such kind and on such
scale as may be provided by the State Government or by the Corporation, and an
insured person or, where such medical benefit is extended to his family, his family
shall not have a right to claim any medical treatment except such as is provided
by the dispensary, hospital, clinic or other institution to which he or his family is
allotted, or as may be provided by the regulations.
2. Nothing in this Act shall entitle an insured person and (where such medical
benefit is extend to his family) his family to claim re-imbursement from the
Corporation of any expenses incurred in respect of any medical treatment, except
as may be provided by the regulations.
Provision of medical treatment by State Government
1. The State Government shall provide for insured persons and (where such benefit
is extended to their families) their families in Stage, reasonable medical, surgical
and obstetric treatment:
Provided that the State Government may, with the approval of the Corporation,
arrange for medical treatment at clinics of medical practitioners on such scale and
subject to such terms and conditions as may be agreed upon.
2. Where the incidence of sickness benefit payment to insured persons in any State
is found to exceed the all-India average, the amount of such excess shall be
shared between the Corporation and the State Government in such proportion as
may be fixed by agreement between them:
Provided that the Corporation may in any case waive the recovery of the whole or
any part of the share which is to be borne by the Stage Government.
3. The Corporation may enter into an agreement with a State Government in regard
to the nature and scale of the medical treatment that should be provided to
239
insured persons and (where such medical benefit is extended to the families) their
families (including provision of buildings, equipment, medicines and staff) and for
the sharing of the cost thereof and of any excess in the incidence of sickness
benefit to insured persons between the Corporation and the State Government.
Benefits not to be combined
1. An insured person shall not be entitled to receive for the same period-
a) both sickness benefit and maternity benefit; or
b) both sickness benefit and disablement benefit for temporary disablement; or
c) both maternity benefit and disablement benefit for temporary disablement.
2. Where a person is entitled to more than one of the benefits mentioned in sub-
section (1), he shall be entitled to choose which benefit he shall receive.
Repayment of benefit improperly received
1. Where any person has received any benefit or payment under this Act when he is
not lawfully entitled thereto, he shall be liable to repay to the Corporation the
value of the benefit or the amount of such payment, or in the case of his death his
representative shall be liable to repay the same from the assets of the deceased, if
any, in his hands.
2. The value of any benefits received other than cash payments shall be determined
by such authority shall be final.
3. The amount recoverable under this section may be recovered as if it were an
arrear of land-revenue or under section 45-C to section 45-I.
Benefit payable up to and including day of death
If a person dies during any period for which he is entitled to a cash benefit
under this Act, the amount of such benefit up to and including the day of his death
shall be paid to any person nominated by the deceased person in writing in such
form as may be specified in the regulations or, if there is no such nomination, to
the heir or legal representative of the deceased person.
Employer not to reduce wages, etc
No employer by reason only of his liability for any contributions payable under
this Act shall, directly or indirectly, reduce the wages of any employee, or except as
provided by the regulations, discontinue or reduce benefits payable to him under
the conditions of his service which are similar to the benefits conferred by this Act.
Employer not to dismiss or punish employee during period of sickness, etc
No employer shall dismiss, discharge, or reduce or otherwise punish an
employee during the period the employee is in receipt of sickness benefit or
maternity benefit, nor shall he, except as provided under the regulations, dismiss,
discharge or reduce or otherwise punish an employee during the period he is in
receipt of disablement benefit for temporary disablement or is under medical
treatment for sickness or is absent from work as a result of illness duly certified in
accordance with the regulations to arise out of the pregnancy or confinement
rendering the employee unfit for work.
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No notice of dismissal or discharge or reduction given to an employee during

the period specified in sub-section (1) shall be valid or operative.
AJUDICATION OF DISPUTE AND CLAIMS
Constitution of Employees’ Insurance Court
1. The State Government shall, by notification in the Official Gazette, constitute an
Employees’ Insurance Court for such local area as may be specified in the
notification.
2. The Court shall consist of such number Judges as the State Government may
think fit.
3. Any person who is or has been a judicial officer or is a legal practitioner of five
years’ standing shall be qualified to be Judge of the Employees’ Insurance Court.
4. The State Government may appoint the same Court for two or more local areas or
two or more Courts for the same local area.
5. Where more than one Court has been appointed for the same local area, the State
Government may, by general or special order, regulate the distribution of
business between them.
Matters to be decided by Employees’ Insurance Court
1. If any question of dispute arises as to,
a) Whether any person is an employee within the meaning of this Act or
whether he is liable to pay the employee’s contribution, or
b) the rate of wages or average daily wages of an employee for the purposes of
this Act, or
c) the rate of contribution payable by a principal employer in respect of any
employee, or
d) the person who is or was the principal employer in respect of any
employee, or
e) the right of any person to any benefit and as to the amount and duration
thereof or
f) any direction issued by the Corporation under section 55-A on a review of
any payment of dependants’ benefits, or
g) any other matter which is in dispute between a principal employer and the
Corporation, or between a principal employer and an immediate employer,
or between a person and the Corporation or between an employee and a
principal or immediate employer in respect of any contribution or benefit
or other dues payable or recoverable under this Act, or any other matter
required to be or which may be decided by the Employees’ Insurance Court
under this Act, such question or dispute subject to the provisions of sub-
section (2-A) shall be decided by the Employees’ Insurance Court in
accordance with the provisions of this Act.
2. Subject to the provisions of sub-section (2-A), the following claims shall be decided
by the Employees’ Insurance court, namely,
a) claim for the recovery of contributions from the principal employer;
241
b) claim by a principal employer to recover contributions from any

immediate employer;
c) claim against a principal employer under section 68;
d) claim under section 70 for the recovery of the value or amount of the
benefits received by a person when he is not lawfully entitled thereto; and
e) any claim for the recovery of any benefit admissible under this act.
3. No Civil Court shall have jurisdiction to decide or deal with any question or dispute
as aforesaid or to adjudicate on any liability which by or under this Act is to be
decided by a Medical Board, or by a Medical Appeal Tribunal or by the Employees’
Insurance Court.
Penalties
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 authorized 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 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 benefit under this Act for such period as may be prescribed
by the Central Government.
Punishment for failure to pay contributions, etc If any person,
a) fails to pay any contribution which under this Act he is liable to pay, or
b) deducts or attempts to deduct from the wages of an employee the whole or any part
of the employer’s contribution, or
c) in contravention of section 72 reduces the wages or any privileges of benefits
admissible to an employee, or
d) in contravention of section 73 or any regulation dismiss, discharges, reduces or
otherwise punishes an employee, or
e) fails or refuses to submit any return required by the regulations, or makes a false
return, or
f) obstructs any Inspector or other official of the Corporation in the discharge of his
duties, or
g) is guilty of any contravention of or non-compliance with any of the requirements of
this Act or the rules or the regulations in respect of which no special penalty is
provided, he shall be punishable.
i. where he commits an offences under clause (a), with imprisonment for a
term which may extend to three years but,
a) which shall not be less than one year, in case of failure to pay the employee’s
contribution which has been deducted by him from the employee’s wages and
shall also be liable to fine of ten thousand rupees;
242
b) which shall not be less than six month, in any other case and shall also be
liable to fine of five thousand rupees:
c) Provided that the Court may, for any adequate and special reasons to be
recorded in the judgment, impose a sentence of imprisonment for a lesser term;
ii. where he commits an offence under any of the clauses (b) to (g) (both
inclusive), with imprisonment for a term which may extend to one year or with
fine which may extend to four thousand rupees, or with both.
Offence by companies
1. If the person committing an offence under this Act is 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 shall be liable to be proceeded
against and punished accordingly.
The employee’s Provident Fund and miscellaneous provisions Act 1952, was
introduced for the benefit of the employees’ working in the factories and their family
members.
After framing the scheme as soon as possible a fund the provisions of this Act
and the scheme as such. The provisions of this Act apply to 173 industries and the
categories of establishments which employ 20 or more persons such as
establishments engaged in manufacturing, marketing, use of a computer and
servicing or deriving any output.
The ESI Act is extended in area wise to Factories using power and employing
10 or more persons and to non power using manufacturing units establishments
employing 20 or more persons upto Rs.10,000/- month.
a) The act is coverage for drawing wages upto Rs.16,000/- month engaged either
directly or through contractor.
The benefits include medical, sickness, funeral expenses and rehabilitation
allowance. The contribution period is from 1st April to 30 September and 1st
October to 31st march.
The payment of Gratuity Act is applicable to every factory, mine, oil field,
plantation, port, railways, company, shop, establishment or educational
243
institutions employing 10 or more employees. The wages for calculation is a 15

days wages for every completed years as if the month comprises of 26 days at the
last drawn wages.
The qualifying period on rendering of 5 years service, either termination,
resignation or retirement the nomination to be obtained by employer after expiry of
one year’s service inform ‘F’.
1. What are the scope and object of the Employee’s Provident Funds and
miscellaneous provisions Act 1952?
2. What is the penalty for avoiding any payment to be made by an employer under
the employees’ Provident Funds and miscellaneous Provisions Act 1952?
3. Write short notes on
4. Transfer of accumulations from existing Provident Fund.
5. Mode of payment of contributions.
6. When does an employee for feet his right gratuity?
7. What are the circumstances in which gratuity becomes payable to an
employee under the payment of Gratuity Act 1972?
8. Can an Insured women be entitled to sickness benefit and maternity benefit
together for the same period?
9. What are the different types of benefits provided by the employees State
Insurance Act 1948.
24.6 SUMMARY
The employees Provident Fund is eligible to any person who is employed for
work of an establishment or employed through contractor in or in connection with
the work of an establishment employees converted enjoy a benefit of social security
in the form of an un attachable and unwithdrawable financial nest egg to which
employees and employers contribute equality through the covered persons
employment. Employer is liable to be arrested without warrant being a cognizable
offence. Defaulters by employer in paying contributions or inspection administrative
live charges attract imprisonment upto 3 years and fine upto Rs.10,000/-
The Act guarantees reasonably good medical care to workers and their
immediate dependants. The scheme was first implemented at Kanpur and Delhi on
24th February 1952. The Act in fact tries to attain the goal of socio economic justice
enshrined in the Directive Principles of state policy Act under part IV of the
constitution.
The umbrella legislation relating to gratuity is the payment of Gratuity Act
1972. The Act was enacted to provide for a scheme for the payment of Gratuity to
employees engaged in factories, mines etc. The appropriate Government may be
notification and subject to such conditions as may be specified in the notification,
exempt any establishment to which this Act applies or any employee or class of
employees employed therein, from the operation of the provisions of this Act, if in
the opinion of the appropriate Govt. the employees, the employees in such
244
establishment are in receipt of gratuity or pensioner benefits not less favourable

than the benefits conferred under this Act.
1. What are the rules as to payment and recovery of Provident Fund contribution
by an employer?
2. How are inspectors appointed for the purpose of the EPF and miscellaneous
provision Act 1952?
3. What are the provisions regarding protection against attachment of the
amount standing to the credit of any member in the Provident Fund?
4. Write a note on compulsory insurance of employer for payment of Gratuity.
5. How does the employees State Insurance Act 1948 provide for the
adjudication of disputes and claims?
6. What are the different types of benefits provided by the ESI Act 1948?
7. Discuss the circumstances under which an employee who suffers injury due
to an employee who suffers injury due to an accident, happening while acting
in breach of regulations will receive benefit?
1. Indian Iron steel Co. Ltd Vs workmen (1967), I.L.L.L.J; 381, Patna.
2. State of Bombay Vs Hospital Mazdoor Sabha, AIR, 1960, S.C, 160.
3. Minivra Miills Ltd., Bangalore V.Their workmen AIR, 1953, S.C.505.
4. British India Corporation Ltd V The workmen A.I.R, 1957, S.C. 354.
5. Air Gas Masdoor Sangh V Indian Air Gases Ltd (1977). ILJ Allahabad.
6. T.N. Chhabra, R.K.Suri, Industrial Relations concepts & Issues, Dhanpath Rai
& Co. Pvt. Ltd, New Delhi, 2005.
24.9 ASSIGNMENTS
1. Prepare a best of factories which has implemented EPF and those not
implemented. Find out the details and reasons for non implementation.
2. The ESI Act, 1948 is gradually replacing the Maternity Act and the workmen’s
Compensation Act - Comment.
3. An employee dies while in service and he had not completed 5 years of
continuous service of the time of his death. Is he entitled to receive payment of
gratuity?
1. Ghosh.P., Personnel Administration in India, 1969.
2. Kapoor, T.N. (Ed)., Personnel Management and Industrial Relations in India.
3. Jucius, Michael.J., Personnel Management, Richard Irvin, Illinois.
4. Personnel Management and Industrial Relations, By P.C.Tripathi.
5. Arun Kumar, Rachana Sharma, Personnel Management, Theory and Prachce,
Aalantic Publication & Distributions.
6. B.D.Singh, Industrial Relations emerging paradigins., Excel Books.
7. P.C.Tripathi, Personnel Management & Industrial Relations.
8. P.Saravanavel; Labour Legislation, Eswar Press.
245

1. Compare the various Provisions of EPF Act 1952 of India with countries of
least developed one.
2. State briefly with your comments about the establishment and constitution of
the ESI corporation, the standing committee and the Medical Benefit Council
and their powers and duties.
3. Who is controlling authority under payment of Gratuity Act 1972? What are
his powers? Who can apply controlling authority for direction? when can this
application be made?
24.12 KEY WORDS
1. Basic wages
2. Workforce
3. Provident Funds
4. Authorized officer
5. Family Pension
6. Gazette
7. Compulsory Insurance
8. Gratuity
9. Retirement
10. Controlling Authority
11. Contribution
12. Disablement
13. Claims
14. Benefits
15. Disqualification

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347 EN 230 – 1a 347 EN 230 – 11a
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347 EN 230 – 2a 347 EN 230 – 12a
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347 EN 230 – 4a 347 EN 230 – 14a
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347 EN 230 – 5a 347 EN 230 – 15a
347 EN 230 – 6 347 EN 230 – 16
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347 EN 230 – 10a 347 EN 230 – 20a

Labour Welfare

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Srini : MBA-HRM/ Second Year/Labour Welfare/ Lessons:1-25

M.B.A. Human Resource Management

Prof. Dr. E. Selvarajan

Dr. C. Samudhra Rajakumar Prof. Dr. M. Sivasubramanian

M.B.A. HUMAN RESOURCE MANAGEMENT

LABOUR WELFARE - MEANING SCOPE OF SIGNIFICANCE

The Relative Concept of Welfare

c) Establishment of Industrial Peace

11. Principle of self help

5. How is Labour Welfare Accountable?

LABOUR WELFARE AGENCIES - LABOUR WELFARE OFFICER -

managed by a Board of Governors which has 51 members besides the Chairman

hazardous jobs, visiting the sick, accident prevention, supervision of safety

b) Counseling workers in,

Welfare Amenities outside the Establishment include conducting sports,

that sexual harassment of working women amounts to violation of rights gender

1. Discuss elaborately the principles for successful Implementation of welfare

LABOUR WELFARE AGENCIES - LABOUR WELFARE OFFICER -

 The State Government may by Notification in official Gazette declare that

i) provide adequate rest rooms or suitable alternative arrangements where

GROWTH & CONCEPT OF LABOUR WELFARE IN INDIA

c) Paternalistic or trusteeship Theory

TERMINOLOGY, MEANING, HISTORY AND GROWTH OF FRINGE

Grade H & Above RHRD / Admin Dept. Reporting officer, viz.

2. What are the objectives of fringe benefits?

COVERAGE OF BENEFITS - ADMINISTRATION OF BENEFITS AND

b) Extra pay for time worked

BASIC HUMAN NEEDS - CHANGE NATURE OF HUMAN NEEDS

determinants rather than the intractability of individual instincts, they suggested

consensus, interest-based commercial and political bargaining, and the violent

Third, a needs-based approach to social conflict undermines conventional

contends that an adequate account of needs as sources of destructive conflict must

to social conflict undermines conventional notions of conflict causation. This theory

THE MAJOR ROLE IN NEED FULFILLMENT - MAJOR ROLE IN

needs. Some times, non-directive interviewing, or open-ended invitations to express the

WELFARE OFFICERS - ROLES AND RESPONSIBILITIES - DUTIES OF

a) eliminating the evils and malpractices of the jobber system;

The functions of the Welfare Officer

Conciliation Officer, Court or Tribunal on behalf of the management of a mine against

AIMS AND OBJECTIVES OF WORKERS EDUCATION

members, and their rights and obligations as citizens, as workers in industry,

j) Need Based Special Programme at the Unit Level (3-5 days)

RECOMMENDATION OF NATIONAL COMMISSION ON LABOUR

the interest of supervisory staff as they will now be part of managerial

Establishment employing 20 or more workers should have Standing Order or

responsibility and contributory participation. Such a system will temper and

 A National Scheme be drawn up for payment of pension to leprosy affected

11.7 TERMINAL EXERCISES

MEANING OF FATIGUE - MONOTONY AND BOREDOM - METHOD

12.5 INTEXT QUESTIONS

SIGNIFICANCE OF OCCUPATIONAL, HEALTH OCCUPATIONAL

Objectives of occupational Health Services

4. HRD News Letter,

STATUTORY PROVISIONS UNDER FACTORIES ACT 1948

3. Ventilation and temperature

2. Any mounting or shipping of belts or lubrication or other adjusting operation.

iii) Exclusion of effective enclosure of all possible sources of ignition [Section

1. Constitution of Site Appraisal Committee

or transported, and such records shall be accessible to the workers subject to

14.7 TERMINAL EXERCISES

INDUSTRIAL ACCIDENT, NATURE OF ACCIDENT AND

COST AND CONSEQUENCES OF INDUSTRIAL ACCIDENT

15.4 REVISION POINTS

ACCIDENT MEASUREMENT - BASIS OF SAFETY PROGRAMME AND