Labour Law II External FINAL PDF

LABOUR LAW II (EXTERNAL)
UNIT 1
1. DEFINE FACTORY AND THE OBJECTS AND SCOPE OF FACTORY ACT, 1948.
 The first Factories Act was passed in 1881. The second Act was in 1934.
 The Factories Act, 1948 got assent of the Governor-General of India on 23rd September,
1948. It came into force on 1st April, 1949.
 This Act was later Amended in 1954 – The Factories (Amendment) Act, 1954 due to
Ratification by India of International Labour Convention relating to prohibition of
employment of young persons during night in factories. A new chapter was added “Annual
Leave with Wages” was substituted for Chapter VIII of the Act. It also enacted that no
younger person and women to work in factories in the night and not employed for cleaning,
lubricating, or adjusting any prime mover or transmission machinery while in motion.
 The Factories Act, 1948 applies to whole of India, including Jammu and Kashmir.
 It covers all manufacturing processes and establishments falling within the definition of
‘factory’ as defined under section 2(m) of the Act.
 The object of the Act are:
a. To ensure safety and to promote the health and welfare of the workers employed in
factories.
b. To afford protection to human beings from long hours of work.
c. To provide for healthy and sanitary conditions in the factories.
d. To make provisions regarding employment of women and young persons.
e. To provide for the prevention of accidents on machines and other equipment’s.
f. To make provisions for annual leave without wages.
g. To regulate and control its working by appointment of Inspectors by the State Government.
 The Factories Act is a piece of social welfare legislation. It is primarily for the welfare of the
factory workers and it governs the working conditions of the factory workers.
 The Factories Act deals with health, welfare, and safety of workmen.
FACTORY
 Factory means any premises where 10 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 (10 or more working with the
aid of power).
 Factory also means any premises where 20 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 (20 or more working
without the aid of power).
 For any premises to be a factory the following conditions must be fulfilled:
a. Manufacturing process must be carried out in any part of the premises of the
establishment.
b. Manufacturing process carried out by 10 or more with aid of power and 20 or more without
aid of power. Mere fact that power was used in the premises is not sufficient but power
must be used in the aid of manufacturing process.
 Premises where the manufacturing process is going on with seven persons employed
permanently and three persons employed on temporary basis in repairing of machinery is
a factory.
1 LABOUR LAW II (EXTERNAL) NOTES BY FR. LAWRENCE (FOR PRIVATE CIRCULATION ONLY)
 Manufacturing process:
“manufacturing process” means any process for-
a. 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 its use, sale, transport, delivery or disposal; or
b. pumping oil, water, sewage, or any other substance; or
c. generating, transforming or transmitting power; or
d. composing types for printing, printing by letter press, lithography, photogravure or other
similar process or book-binding; or
e. constructing, reconstructing, repairing, refitting, finishing or breaking up ships or vessels;
or
f. preserving or storing any article in cold storage.
Judicial view on manufacturing processes: the following are manufacturing processes.
- Making of bidies.
- Molding and transforming of raw cinematography films into a finished product.
- Construction of railway – use of raw materials like sleepers, bolts, loose rails, etc. to
adaptation of their use for ultimately for laying down railway lines.
- Process carried out in salt works in converting sea water into salt.
- Ginning and pressing cotton.
- Work of composition in printing business.
- Pasteurization of milk for sale.
- Removal of outer cover of coffee seeds.
- Preparation of food and beverages and its sale to members of a club.
Judicial view on manufacturing processes: the following are not manufacturing
processes.
- Any preliminary packing of raw materials for delivering it to the factories.
- Finished goods and packing thereof.
- Exhibition of films process.
- Industrial school or institute imparting training, producing cloth, not with a view to its sale
2. EXPLAIN DUTIES OF THE OCCUPIER WITH REFERENCE TO FACTORIES ACT

1948.
 Occupier of a factory is explained in section 2(n) of the Factories Act, 1948.
 Occupier of a factory means the person who has ultimate control over the affairs of the
factory.
a. In a firm or other association of individuals, any one of the individual partners or
members thereof shall be deemed to be the occupier.
b. In a company, any one of the directors, shall be deemed to be the occupier.
c. In 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.
d. In the case of a ship which is being repaired, or on which maintenance work is being
carried out, in a dry dock which is available for hire - the owner of the dock shall be
deemed to be the occupier for the purposes of any matter.
 The expression occupier is not to be equated with owner. The owner is the ultimate controller
of the factory but he need not be occupier i.e. if he has completely transferred that control to
another person.
 An occupier may be an owner, a lessee or a mere license but he must have the right to occupy
the property and dictate terms of management.
 If a manager claims to be occupier of the factory then he must lay before the chief inspector of
the factories the necessary materials for showing that the company had in some manner
transferred the entire control over the factory to him.
 In a company the board of directors could appoint a person to be occupier of the factory, so
that he is in a better position to answer then the board of directors.
 In L & T Ltd v/s Director of Industrial Health and Safety and another, the High Court held that
section 2(n) provides that occupier of a factory means a person who has ultimate control over
the affairs of the factory.
 Section 101 provides exemption of occupier or manager from liability in certain cases. Where
the occupier or manager of a factory is charged with an offence punishable under this Act, he
shall be entitled, upon complaint duly made by him and on giving to the prosecutor not less
than three clear days’ notice in writing of his intention so to do, 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 occupier
or manager of the factory, as the case may be, proves 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.
Duties of Occupier
 Every occupier shall ensure so far as is reasonably practical, the health, safety and welfare of
all workers while they are work in the factory (7A(1)).
 The matters to which this duty extends are:
a. The provision and maintenance of plant and system of work in the factory that are safe and
without risks to health.
b. The arrangement in the factory for ensuring safety and absence of risks to health in
connection with the use, handling, storage and transport of articles and substances.
c. The provision of such information, instructions, training, and supervision as are necessary
to ensure the health and safety of all workers at work.
d. The maintenance of all places of work in the factory as a condition that is safe and without
risks to health and the provision and maintenance of such means of access to egress
(outlet, door) 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.
 The occupier 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 the workers in
such manner as may be prescribed.
The occupier shall also perform these duties such as:

 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.
 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.
 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.
 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.
 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.
3. EXPLAIN POWER OF INSPECTING STAFF WITH REFERENCE TO FACTORIES ACT

1948.
 Who is the Inspecting Staff? Section 8
a. The State Government may, by notification in the Official Gazette, appoint such persons as
possess the prescribed qualification to be Inspectors for the purposes of this Act and may
assign to them such local limits as it may think fit.
b. 8 (2) The State Government may, by notification in the Official Gazette, appoint any
person to be a Chief Inspector who shall, in addition to the powers conferred on a Chief
Inspector under this Act, exercise the powers of an Inspector throughout the State.
c. 8 (2A) The State Government may, by notification in the Official Gazette, appoint as many
Additional Chief Inspectors, Joint Chief Inspectors and Deputy Chief Inspectors and
as many other officers as it thinks fit to assist the Chief Inspector and to exercise such of
the powers of the Chief Inspector as may be specified in such notification. (2B) Every
Additional Chief Inspector, Joint Chief Inspector, Deputy Chief Inspector and every other
officer appointed under sub-section (2A) shall, in addition to the powers of a Chief
Inspector specified in the notification by which he is appointed, exercise the powers of an
Inspector throughout the State.] (3) No person shall be appointed under sub-section (1),
sub-section (2), 4[sub-section (2A)] or sub-section (5), or, having been so appointed, shall
continue to hold office, who is or becomes directly or indirectly interested in a factory or in
any process or business carried on therein or in any patent or machinery connected
therewith.
d. Every District Magistrate shall be an Inspector for his district.
e. The State Government may also, by notification as aforesaid, appoint such public officers
as it thinks fit to be Additional Inspectors for all or any of the purposes of this Act, within
such local limits as it may assign to them respectively.
f. In any area where there are more Inspectors than one, the State Government may, by
notification as aforesaid, declare the powers, which such Inspectors shall respectively
exercise and the Inspector to whom the prescribed notices are to be sent.
g. Every Chief Inspector, Additional Chief Inspector, Joint Chief Inspector, Deputy Chief
Inspector, Inspector and every other officer appointed under this section shall be deemed to
be a public servant within the meaning of the Indian
h. Any person having any direct or indirect interest in a factory or in any process of
business carried on therein or in any plant or machinery connected therewith cannot be
appointed as Inspector, Chief Inspector, or public Officer.
 Powers of the Inspecting Staff? Section 9

Subject to any rules made in this behalf, an Inspector may, within the local limits for which he
is appointed-
a. Enter, with such assistants, being persons in the service of the Government, or any local or
other public authority, or with an expert as he thinks fit, any place which is used, or which
he has reason to believe is used, as a factory;
b. Make examination of the premises, plant, machinery, article or substance.
c. Inquire into any accident or dangerous occurrence, whether resulting in bodily injury,
disability or not, and take on the spot or otherwise statements of any person which he may
consider necessary for such inquiry;
d. Require the production of any prescribed register or any other document relating to the
factory;
e. Seize, or take copies of any register, record or other document or any portion thereof, as he
may consider necessary in respect of any offence under this Act, which he has reason to
believe, has been committed;
f. Direct the occupier that any premises or any part thereof, or anything lying therein, shall be
left undisturbed (whether generally or in particular respects) for so long as is necessary for
the purpose of any examination under clause (b);
g. Take measurements and photographs and make such recordings as he considers necessary
for the purpose of any examination under clause (b), taking with him any necessary
instrument or equipment;
h. In case of any article or substance found in any premises, being an article or substance
which appears to him as having caused or is likely to cause danger to the health or safety of
the workers, direct it to be dismantled or subject it to any process or test (but not so as to
damage or destroy it unless the same is, in the circumstances necessary, for carrying out the
purposes of this Act), and take possession of any such article or substance or a part thereof,
and detain it for so long as is necessary for such examination;
i. Exercise such other powers as may be prescribed: Provided that no person shall be
compelled under this section to answer any question or give any evidence tending to
incriminate himself.
j. The registers and other documents maintained under the Act are public documents
because such records are maintained on behalf of the Government. Being public documents
the Authorities can demand the production of such documents. The factory Inspector has
no power to call upon the proprietor to produce the register and other documents at his
office. The production is to be made on the premises only.
 Appointment of welfare and safety officer.

a. Welfare Officer
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. The State
Government may prescribe the duties, qualifications and conditions of service of officers
employed under sub-section (1).
b. Safety Officer
In every factory,
(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,
employ such number of Safety Officers as may be specified in that notification.
The duties, qualifications and conditions of service of Safety Officers shall be such as may be
prescribed by the State Government.
4. EXPLAIN THE PROVISIONS OF SAFETY WITH REFERENCE TO FACTORIES ACT

1948.
 Sections 21 to 40 (chapter IV) lay down certain obligatory provisions in regard to safety
measures for the workers to be observed in every factory.
 Safety Officers: Wherein one thousand or more workers are ordinarily employed, or
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, employ such number
of Safety Officers as may be specified in that notification.
 The measures taken as regards safety are:
a. Fencing of machinery.
b. Working on or near Machinery in Motion.
c. Employment of young persons on dangerous machines.
d. Self-acting machines.
e. Casing of new machinery.
f. Prohibition of employment of women and children near cotton openers.
g. Host and lifts.
h. Lifting machines, chains, and ropes and lifting tackles.
i. Safety measures in case of revolving machinery.
j. Pressure plant
k. Floors, stairs and access.
l. Pits, slumps, opening in floors.
m. Excessive weights.
n. Protection of eyes.
o. Precaution against dangerous fumes, gases, etc.
p. Precaution regarding the use of portable electric lights
q. Explosive or inflammable dust, gas, etc.
r. Precaution in case of fire.
s. Power to require specification of defective parts or tests of stability.
t. Safety of buildings and machinery.
u. Maintenance of building
a. Fencing of machinery.
 In every factory the following, namely, every moving part of a prime mover and every
flywheel connected to a prime mover whether the prime mover or flywheel is in the
engine house or not; the headrace and tailrace of every water-wheel and water turbine;
any part of a stock-bar which projects beyond the head stock of a lathe; should be
fenced.
 Provided that for the purpose of determining whether any part of machinery is in such
position or is of such construction as to be safe as aforesaid, account shall not be taken
of any occasion when
(i) it is necessary to make an examination of any part of the machinery aforesaid
while it is in motion or, as a result of such examination, to carry out lubrication or
other adjusting operation while the machinery is in motion, being an examination
or operation which it is necessary to be carried out while that part of the
machinery is in motion, or
(ii) in the case of any part of a transmission machinery used in such process as may
be prescribed (being a process of a continuous nature the carrying on of which
shall be, or is likely to be, substantially interfered with by the stoppage of that
part of the machinery), it is necessary to make an examination of such part of the
machinery while it is in motion or, as a result of such examination, to carry out
any mounting or shipping of belts or lubrication or other adjusting operation
while the machinery is in motion, and such examination or operation is made or
carried out in accordance with the provisions of sub-section (1) of section 22.
The State Government may by rules prescribe such further precautions as it may
consider necessary in respect of any particular machinery or part thereof, or exempt,
subject to such condition as may be prescribed, for securing the safety of the workers
any particular machinery or part thereof from the provisions of this section.
b. Working on or near Machinery in Motion.

- Where in any factory it becomes necessary to examine any part of machinery while
the machinery is in motion then it should be 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.
- 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. (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 worker otherwise be liable to come into contact, shall be securely fenced to
prevent such contact.
- No woman or young person shall be allowed to clean, lubricate or adjust any part of a
prime mover or of any transmission machinery while the prime mover or 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.
- The State Government may, by notification in the Official Gazette, prohibit, in any
specified factory or class or description of factories, the cleaning, lubricating or
adjusting by any person of specified parts of machinery.
c. Employment of young persons on dangerous machines.
- No young person shall be required or allowed to work at any machine 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.
d. Self-acting machines.
- No crisscrossing part of a 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: Provided that the Chief Inspector may
permit the continued use of a machine installed before the commencement of this Act,
which does not comply with the requirements of this section on such conditions for
ensuring safety as he may think fit to impose.
e. Casing of new machinery.
- In all machinery driven by power and installed in any factory after the commencement
of this Act
(a) every set screw, bolt or key on any revolving shaft, spindle, wheel or pinion shall
be so sunk, encased or otherwise effectively guarded as to prevent danger;
(b) all spur, worm and other toothed or friction gearing which does not require
frequent adjustment while in motion shall be completely encased, unless it is so
situated as to be as safe as it would be if it were completely encased.
- Whoever sells or lets on hire or, as agent of a seller or hirer, causes or procures to be
sold or let or hire, for use in a factory any machinery driven by power which does not
comply with the provisions of sub-section (1) or any rules made under sub-section
(3)], 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.
- The State Government may make rules specifying further safeguards to be provided in
respect of any other dangerous part of any particular machine or class or description of
machines.
f. Prohibition of employment of women and children near cotton openers.
- 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 in situated.
g. Host and lifts.
1. every hoist and lift shall be
a. of good mechanical construction, sound material and adequate strength;
b. properly maintained, and shall be thoroughly examined by a competent person at
least once in every period of six months and a register shall be kept containing the
prescribed particulars of every such examination.
2. every hoist way and lift way shall be sufficiently protected by an enclosure fitted with
gates, and the hoist or lift and every such enclosure shall be so constructed as to
prevent any person or thing from being trapped between any part of the hoist or lift
and any fixed structure or moving part;
3. the maximum safe working load shall be plainly marked on every hoist or lift, and no
load greater than such load shall be carried thereon;
4. the cage of every hoist or lift used for carrying persons shall be fitted with a gate on
each side from which access is afforded to a landing;
5. every gate referred to in clause (b) or clause (d) shall be fitted with inter-locking or
other efficient device to secure that the gate cannot be opened except when the cage is
at the landing and that the cage cannot be moved unless the gate is closed.
6. The following additional requirements shall apply to hoists and lifts used for carrying
persons and installed or reconstructed in a factory after the commencement of this Act,
namely:-
a. where the cage is supported by rope or chain, there shall be at least two ropes or
chains separately connected with the cage and balance weight, and each rope or
chain with its attachments shall be capable of carrying the whole weight of the cage
together with its maximum load;
b. efficient devices shall be provided and maintained capable of supporting the cage
together with its maximum load in the event of breakage of the ropes, chains or
attachments;
c. an efficient automatic device shall be provided and maintained to prevent the cage
from over-running.
7. The Chief Inspector may permit the continued use of a hoist or lift installed in a
factory before the commencement of this Act which does not fully comply with the
provisions of sub-section (1) upon such conditions for ensuring safety as he may think
fit to impose.
8. The State Government may, if in respect of any class or description of hoist or lift, it is
of opinion that it would be unreasonable to enforce any requirement of sub-sections
(1) and (2), by order direct that such requirement shall not apply to such class or
description of hoist or lift.
h. Lifting machines, chains, and ropes and lifting tackles.
Lifting machine means a crane, crab, winch, teagle, pulley block, gin wheel, transporter
or runway.
Lifting tackle means any chain, sling, rope sling, hook, shackle, swivel, coupling, socket,
clamp, tray or similar appliance, whether fixed or movable, used in connection with the
raising or lowering of persons, or loads by use of lifting machines.
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 moveable, 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 claim, 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 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 metres
of that place.
i. Safety measures in case of revolving machinery.
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 notices 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 revolving vessel, cage, basket, flywheel, pulley, disc or similar
appliance driven by power is not exceeded.
j. Pressure plant
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.
The State Government may make rules providing for the examination and testing of any
plant or machinery such as is 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.
The State Government may, by rules, exempt, subject to such conditions as may be
specified therein, any part of any plant or machinery referred to in sub-section (1) from
the provisions of this section.
k. Floors, stairs and access.
In every factory –
(a) all floors, steps, stairs, passages and gangways shall be of sound construction and
properly maintained and shall be kept free from obstructions and substances likely to
cause persons to slip, and where it is necessary to ensure safety, steps, stairs,
passages and gangways shall be provided with substantial handrails;
(b) there shall, so far as is reasonably practicable, be provided and maintained safe
means of access to every place at which any person is at any time required to work.
(c) When any person has to work at a height from where he is likely to fall, provision
shall be made, so far as is reasonably practicable, by fencing or otherwise, to ensure
the safety of the person so working.
l. Pits, slumps, opening in floors.
(1) In every factory fixed vessel, sump, tank, pit or opening in the ground or in a floor
which, by reasons of its depth, situation, construction or contents, is or may be a
source of danger, shall be either securely covered or securely 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.
m. Excessive weights.
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.
The State Government may make rules prescribing the maximum weights which may be
lifted, carried or moved by adult men, adult women, adolescents and children employed
in factories or in any class or description of factories or in carrying on any specified
process.
n. 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 or 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.
o. Precaution against dangerous fumes, gases, etc.
(3) No person shall be required or allowed to enter 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, unless it is provided with a manhole of adequate size or other effective
means of egress.
(4) No person shall be required or allowed to enter any confined space as is referred to
in sub-section (1), until all practicable measures have been taken to remove any gas,
fume, vapour or dust, which may be present so as to bring its level within the
permissible limits and to prevent any ingress of such gas, fume, vapour or dust and
unless-
(a) a certificate in writing has been given by a competent person, based on a test
carried out by himself that the space is reasonably free from dangerous gas,
fume, vapour or dust; or
(b) such person is wearing suitable breathing apparatus and a belt securely attached
to a rope the free end of which is held by a person outside the confined space.
p. Precaution regarding the use of portable electric lights
(a) no portable electric light or any other electric appliance of voltage exceeding twenty-
four volts shall be permitted for use inside any chamber, tank, vat, pit, pipe, flue or
other confined space unless adequate safety devices are provided; and
(b) if any inflammable gas, fume or dust is likely to be present in such chamber, tank,
vat, pit, pipe, flue or other confined space, no lamp or light other than that of flame-
proof construction shall be permitted to be used therein.
q. 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 on ignition, 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 the 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 effect of the explosion by the provisions in the plant
or machinery of chokes, baffles, vents or other effective appliances.
(3) No plant, tank or vessel which contains or has contained any explosive or
inflammable substance shall be subjected in any factory to any welding, brazing,
soldering or cutting operation which involves the application of heat unless adequate
measures have first been taken to remove such substance and any fumes arising
therefrom or to render such substance and fumes non-explosive or non-inflammable,
and no such substance shall be allowed to enter such plant, tank or vessel after any
such operation until the metal has cooled sufficiently to prevent any risk of igniting
the substance.
r. Precaution in case of fire.
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.
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
routine to be followed in such cases.
s. Power to require specification of defective parts or tests of stability.
If it appears to the Inspector that any building or part of a building or any part of the
ways, machinery or plant in a factory is in such a condition that it may be dangerous to
human life or safety, he may serve on 3[the occupier or manager or both] of the factory an
order in writing requiring him before a specified date: (a) to furnish such drawings,
specifications and other particulars as may be necessary to determine whether such
building, ways, machinery or plant can be used with safety, or (b) to carry out such test in
such manner as may be specified in the order, and to inform the Inspector of the results
thereof.
t. Safety of buildings and machinery.
(1) If it appears to the Inspector that any building or part of a 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 4[the occupier or manager or both 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 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.
u. Maintenance of building
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.
5. EXPLAIN HAZARDOUS PROCESS AND DISCUSS THE PROVISIONS RELATING TO

IT WITH REFERENCE TO FACTORIES ACT 1948. EXPLAIN HAZARDOUS AND
MANUFACTURING PROCESS.
 Hazardous process means 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, bye-products, wastes or effluents thereof would
a. cause material impairment to the health of the persons engaged in or connected therewith, or
b. result in the pollution of the general environment: Provided that 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.
 Provisions relating to hazardous processes are:

a. Constitution of Site Appraisal Committees.
b. Compulsory disclosure of information by the occupier.
c. Specific responsibility of the occupier in relation to hazardous processes.
d. Power of Central Government to appoint Inquiry Committee
e. Emergency standards.
f. Permissible limits of exposure of chemical and toxic substances.
g. Workers’ participation in safety management.
h. Right of workers to warn about imminent danger.
a. Constitution of Site Appraisal Committees.

 Section 41A.
(1) The State Government may, for purposes of advising it to consider applications
for grant of permission for the initial location of a factory involving a hazardous
process or for the expansion of any such factory, appoint a Site Appraisal
Committee consisting of –
a. the Chief Inspector of the State who shall be its Chairman,
b. a representative of the Central Board for the Prevention and Control of Water
Pollution appointed by the Central Government under Section 3 of the Water
(Prevention and Control of Pollution) Act, 1974 (6 of 1974);
c. 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(14 of 1981);
d. a representative of the State Board appointed under section 4 of the Water
(Prevention and Control of Pollution) Act, 1974 (6 of 1974);
e. a representative of the State Board for the Prevention and Control of Air
Pollution referred to in section 5 of the Air (Prevention and Control of
Pollution) Act, 1981 (14 of 1981);
f. a representative of the Department of Environment in the State;
g. a representative of the Meteorological Department of the Government of
India;
h. an expert in the field of occupational health; and
i. a representative of the Town Planning Department of the State Government,
and not more than five other members who may be co-opted by the State
Government who shall be –
(i) a scientist having specialised knowledge of the hazardous process which
will be involved in the factory,
(ii) a representative of the local authority within whose jurisdiction the
factory is to be established, and
(iii) not more than three other persons as deemed fit by the State Government.
(2) The Site Appraisal Committee shall examine an application for the establishment
of a factory involving hazardous process and make its recommendation to the
State Government within a period of ninety days of the receipt of such application
in the prescribed form.
(3) Where any process relates to a factory owned or controlled by the Central
Government or to a corporation or a company owned or controlled by the Central
Government, the State Government shall co-opt in the Site Appraisal Committee
a representative nominated by the Central Government as a member of that
Committee.
(4) The Site 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.
(5) Where the State Government has granted approval to an application for the
establishment or expansion of a factory involving 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 (6 of 1974), and the Air (Prevention and Control of
Pollution) Act, 1981 (14 of 1981).
b. Compulsory disclosure of information by the occupier.
 Section 41B.
1. The occupier of every factory involving a hazardous process shall disclose in the
manner prescribed all information regarding dangers, including health hazards
and the measures to overcome such hazards arising from the exposure to or
handling of the materials or substances in the manufacture, transportation, storage
and other processes, to the workers employed in the factory, the Chief Inspector,
the local authority within whose jurisdiction the factory is situate and the general
public in the vicinity.
2. The occupier shall, at the time of registering the factory involving a hazardous
process, lay down a detailed policy with respect of the health and safety of the
workers employed therein and intimate such policy to the Chief Inspector and the
local authority and, thereafter, at such intervals as may be prescribed, inform the
Chief Inspector and the local authority of any change made in the said policy.
3. The information furnished under sub-section (1) shall include accurate
information as to the quantity, specifications and other characteristics of wastes
and the manner of their disposal.
4. Every occupier shall, with the approval of the Chief Inspector, 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.
5. Every occupier of a factory shall, -
(a) if such factory engaged in a hazardous process on the commencement of the
Factories (Amendment) Act, 1987, within a period of thirty days of such
commencement; and
(b) if such factory proposes to engage in a hazardous process at any time after
such commencement, within a period of thirty days before the
commencement of such process, inform the Chief Inspector of the nature and
details of the process in such form and in such manner as may be prescribed.
6. Where any occupier of a factory contravenes the provisions of sub-section (5), the
licence issued under section 6 to such factory shall, notwithstanding any penalty
to which the occupier of factory shall be subjected to under the provisions of this
Act, be liable for cancellation.
7. The occupier of a factory involving a hazardous process shall, with the previous
approval of the Chief Inspector, lay down measures for the handling, usage,
transportation and storage of hazardous substances inside the factory premises
and the disposal of such substances outside the factory premises and publicise
them in the manner prescribed among the workers and the general public living in
the vicinity.
c. Specific responsibility of the occupier in relation to hazardous processes.
 Section 41C.
1. Every occupier of a factory involving any hazardous process shall –
(a) maintain accurate and up-to-date health records or, as the case may be,
medical records, of the workers in the factory who are exposed to any
chemical, toxic or any other harmful substances which are manufactured,
stored, handled or transported and such records shall be accessible to the
workers subject to such conditions as may be prescribed;
(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 manner prescribed: Provided that where any
question arises as to the qualifications and experience of a person so
appointed, the decision of the Chief Inspector shall be final;
(c) provide for medical examination of every worker –
(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, a interval not exceeding twelve months, in such manner as may be
prescribed.
d. Power of Central Government to appoint Inquiry Committee
 Section 41D.
(1) The Central Government may, in the event of the occurrence of an extraordinary
situation involving a factory engaged in a hazardous process, appoint an Inquiry
Committee to inquire into the standards of health and safety observed in the
factory with a view to finding 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
affected, due to such failure or neglect and for the prevention and recurrence of
such extraordinary situations in future in such factory or elsewhere.
(2) The Committee appointed under sub-section (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.
(3) The recommendations of the Committee shall be advisory in nature.
e. Emergency standards.
 Section 41E.
(1) Where the Central Government is satisfied that no standards of safety have been
prescribed in respect of a hazardous process or class of hazardous processes, or
where the standards so prescribed are inadequate, it may direct the Director-
General of Factory Advice Service and Labour Institutes or any institution
specialised in matters relating to standards of safety in hazardous processes, to lay
down emergency standards for enforcement of suitable standards in respect of
such hazardous processes.
(2) The emergency standards laid down under sub-section (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.
f. Permissible limits of exposure of chemical and toxic substances.
 41F. Permissible limits of exposure of chemical and toxic substances.
(1) The maximum permissible threshold limits of exposure of chemical and toxic
substances in manufacturing processes (whether hazardous or otherwise) in any
factory shall be of the value indicated in the Second Schedule.
(2) The Central Government may, at any time, for the purpose of giving effect to any
scientific proof obtained from specialised institutions or experts in the field, by
notification in the Official Gazette, make suitable changes in the said Schedule.
g. Workers’ participation in safety management.
 Section 41G.
(1) 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 the management in maintaining
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
from setting up such Committee.
(2) 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.
h. Right of workers to warn about imminent danger.
 Section 41H.
(1) 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 in charge of the factory or
the process concerned directly or through their representatives in the Safety
Committee and simultaneously bring the same to the notice of the Inspector.
(2) It shall be the duty of such occupier, agent, manager or the person incharge of the
factory or process to take immediate remedial action if he is satisfied about the
existence of such imminent danger and send a report forthwith of the action taken
to the nearest Inspector.
(3) If the occupier, agent, manager or the person in charge referred to in sub-section
(2) is not satisfied about the existence of any imminent danger as apprehended by
the workers, 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.
6. DISCUSS CERTIFYING SURGEONS.

 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 factory or class or description
of factories as it may assign to them respectively.
 A certifying surgeon may, with the approval of the State Government, authorise any qualified
medical practitioner to exercise any of his powers under this Act for such period as the
certifying surgeon may specify and subject to such conditions as the State Government may
think fit to impose, and references in this Act to a certifying surgeon shall be deemed to
include references to any qualified medical practitioner when so authorised.
 No person shall be appointed to be, or authorised to exercise the powers of, a certifying
surgeon, or having been so appointed or authorised, continue to exercise such powers, who is
or becomes the occupier of a factory or is or becomes directly or indirectly interested therein
or in any process or business carried on therein or in any patent or machinery connected
therewith or is otherwise in the employ of the factory: Provided that the State Government
may, by order in writing and subject to such conditions as may be specified in the order,
exempt any person or class of persons from the provisions of this sub- section in respect of any
factory or class or description of factories.
 The certifying surgeon shall carry out such duties as may be prescribed in connection with-
a. the examination and certification of young persons under this Act;
b. the examination of persons engaged in factories in such dangerous occupations or
processes as may be prescribed;
c. the exercising of such medical supervision as may be prescribed for any factory or class or
description of factories where –
(i) cases of illness have occurred which it is reasonable to believe are due to the nature of
the manufacturing process carried on, or other conditions of work prevailing therein;
(ii) by reason of any change in the manufacturing process carried on or in the substances
used therein or by reason of the adoption of any new manufacturing process or of any
new substance for use in a manufacturing process, there is a likelihood of injury to the
health of workers employed in that manufacturing process;
(iii) young persons are, or are about to be, employed in any work which is likely to cause
injury to their health.
Explanation: In this section “qualified medical practitioner” means a person holding a
qualification granted by an authority specified in the Schedule to the Indian Medical
Degrees Act, 1916 (VII of 1916), or in the Schedules to the Indian Medical Council
Act, 1933 (XXVII of 1933).
UNIT 2
7. DISCUSS PROVISIONS REGARDING WELFARE.

 Welfare officers.
(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 conditions of service of
officers employed under sub-section (1).
 The following welfare facilities shall be provided to the employee.
1. Washing facilities.
(1) In every factory:
(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.
2. Facilities for storing and drying of wet 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.
3. Facilities for sitting.
(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 the 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.
4. 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 cupboard to be provided and maintained
shall not be less than one for every one hundred and fifty workers ordinarily employed
3[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 recognised by 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.
5. 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;
(c) the foodstuffs to be served therein and the charges which may be made therefor;
(d) the constitution of a managing committee for the canteen and representation of
the workers in the management of the canteen;
(e) the items of expenditure in the running of the canteen which are not to be taken
into account in fixing the cost of foodstuffs and which shall be borne by the
employer;]
(f) the delegation to the Chief Inspector, subject to such conditions as may be
prescribed, of the power to make rules under clause (c).
6. 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 the workers: Provided that any canteen
maintained in accordance with the provisions of section 46 shall be regarded as part of
the requirements of this sub-section: Provided further that where a lunch room exists
no worker shall eat any food in the workroom.
(2) The shelters or rest rooms or lunch rooms to be provided under subsection (1) shall be
sufficiently lighted and ventilated and shall be maintained in a 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.
7. Crèches.
(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.
8. EXPLAIN THE VARIOUS PROVISIONS OF WORKING HOURS FOR ADULT AND FOR
WOMEN.
A. Working hours for adult
 Adult means a person who has completed his eighteenth year of age.
 “Day” means a period of twenty-four hours beginning at midnight.
 “Week” means a period of seven days beginning at midnight on Saturday night or such
other night as may
 Daily hours. Subject to the provisions of section 51, no adult worker shall be required or
allowed to work in a factory for more than nine hours in any day: Provided that, subject
to the previous approval of the Chief Inspector, the daily maximum hours specified in this
section may be exceeded in order to facilitate the change of shifts.
 Weekly hours. No adult worker shall be required or allowed to work in a factory for
more than forty-eight hours in any week.
 Weekly holidays.-
(1) No adult worker shall be required or allowed to work in a factory on the first day of
the week (hereinafter referred to as the said day), unless-
(a) he has or will have a holiday for a whole day on one of the three days
immediately before or after the said day, and
(b) the manager of the factory has, before the said day or the substituted day under
clause (a), whichever is earlier, (i) delivered a notice at the office of the
Inspector of his intention to require the worker to work on the said day and of
the day which is to be substituted, and (ii) displayed a notice to that effect in the
factory: Provided that no substitution shall be made which will result in any
worker working for more than ten days consecutively without a holiday for a
whole day.
(2) Notices given under sub-section (1) may be cancelled by a notice delivered at the
office of the Inspector and a notice displayed in the factory not later than the day
before the said day or the holiday to be cancelled, whichever is earlier.
(3) Where, in accordance with the provisions of sub-section (1), any worker works on
the said day and has had a holiday on one of the three days immediately before it,
that said day shall, for the purpose of calculating his weekly hours of work, be
included in the preceding week.
 Compensatory holidays.
(1) Where, as a result of the passing of an order or the making of a rule under the
provisions of this Act exempting a factory or the workers therein from the provisions
of section 52, a worker is deprived of any of the weekly holidays for which provision
is made in sub-section (1) of that section, he shall be allowed, within the month in
which the holidays were due to him or within the two months immediately following
that month, compensatory holidays of equal number to the holidays so lost.
(2) The State Government may prescribe the manner in which the holidays for which
provision is made in sub-section (1) shall be allowed.
 Intervals for rest.

1. The periods of work of adult workers in a factory each day shall be so fixed that no
period shall exceed five hours and that no worker shall work for more than five
hours before he has had an interval for rest of at half an hour.
2. The State Government or, subject to the control of the State Government, the Chief
Inspector, may, by written order and for the reasons specified therein, exempt any
factory from the provisions of sub- section (1) so however that the total number of
hours worked by a worker without an interval does not exceed six.
 Spread over.
The periods of work of an adult worker in a factory shall be so arranged that inclusive of
his intervals for rest under section 55, they shall not spread over more than ten and a half
hours in any day: Provided that the Chief Inspector may, for reasons to be specified in
writing, increase the 2[spread over upto twelve hours.
 Night shifts. Where a worker in a factory works on a shift which extends beyond
midnight.
(a) for the purposes of sections 52 and 53, a holiday for a whole day shall mean in his
case a period of twenty-four consecutive hours beginning when his shift ends;
(b) the following day for him shall be deemed to be the period of twenty-four hours
beginning when such shift ends, and the hours he has worked after midnight shall be
counted in the previous day.
 Prohibition of overlapping shifts.
(1) Work shall not be carried on in any factory by means of a system of shifts so
arranged that emore than one relay of workers is engaged in work of the same kind at
the same time.
(2) The State Government or, subject to the control of the State Government, the Chief
Inspector, may, by written order and for the reasons specified therein, exempt on
such conditions as may be deemed expedient, any factory or class or description of
factories or any department or section of a factory or any category or description of
workers therein from the provisions of sub-section (1).
 Extra wages for overtime.
(1) Where a worker works in a factory for more than nine hours in any day or for more
than forty-eight hours in any week, he shall, in respect to overtime work, be entitled
to wages at the rate of twice his ordinary rate of wages.
(2) For the purposes of sub-section (1), “ordinary rate of wages” means the basic wages
plus such allowances, including the cash equivalent of the advantage accruing
through the concessional sale to workers of foodgrains and other articles, as the
worker is for the time being entitled to, but does not include a bonus and wages for
overtime work.
(3) Where any workers in a factory are paid on a piece-rate basis, the time rate shall be
deemed to be equivalent to the daily average of their full-time earnings for the days
on which they actually worked on the same or identical job during the month
immediately preceding the calendar month during which the overtime work was
done, and such time rates shall be deemed to be the ordinary rates of wages of those
workers.
 Restriction on double employment.
No adult worker shall be required or allowed to work in any factory on any day on which
he has already been working in any other factory, save in such circumstances as may be
prescribed. 61. Notice of periods of work for adults.
(1) There shall be displayed and correctly maintained in every factory in accordance
with the provisions of subsection (2) of section 108, a notice of periods of work for
adults, showing clearly for every day the periods during which adult workers may be
required to work.
(2) The periods shown in the notice required by sub-section (1) shall be fixed
beforehand in accordance with the following provisions of this section, and shall be
such that workers working for those periods would not be working in contravention
of any of the provisions of sections 51, 52, 54 2[55, 56 and 58].
(3) Where all the adult workers in a factory are required to work during the same
periods, the manager of the factory shall fix those period for such workers generally.
(4) Where all the adult workers in a factory are not required to work during the same
periods, the manager of the factory shall classify them into groups.
 Notice of periods of work for adults.
(1) There shall be displayed and correctly maintained in every factory in accordance
with the provisions of subsection (2) of section 108, a notice of periods of work for
adults, showing clearly for every day the periods during which adult workers may be
required to work.
(2) The periods shown in the notice required by sub-section (1) shall be fixed
beforehand in accordance with the following provisions of this section, and shall be
such that workers working for those periods would not be working in contravention
of any of the provisions of sections 51, 52, 54 2[55, 56 and 58].
(3) Where all the adult workers in a factory are required to work during the same
periods, the manager of the factory shall fix those period for such workers generally.
(4) Where all the adult workers in a factory are not required to work during the same
periods, the manager of the factory shall classify them into groups according to the
nature of their work indicating the number of workers in each group.
(5) For each group which is not required to work on a system of shifts, the manager of
the factory shall fix the period during which the group may be required to work.
(6) Where any group is required to work on a system of shifts and the relays are not to
be subject to predetermined periodical changes of shifts, the manager of the factory
shall fix the periods during which each relay of the group may be required to work.
(7) Where any group is to work on a system of shifts and the relays are to be subject to
predetermined periodical changes of shifts, the manager of the factory shall draw up
a scheme of shifts where under the periods during which any relay of the group may
be required to work and the relay which will be working at any time of the day shall
be known for any day.
(8) The State Government may prescribe forms of the notice required by sub-section (1)
and the manner in which it shall be maintained.
(9) In the case of a factory beginning work after the commencement of this Act, a copy
of the notice referred to in sub-section (1) shall be sent in duplicate to the Inspector
before the day on which work is begun in the factory.
(10) Any proposed change in the system of work in any factory which will necessitate a
change in the notice referred to in sub- section (1) shall be notified to the inspector in
duplicate before the change is made, and except with the previous sanction of the
Inspector, no such change shall be made until one week has elapsed since the last
change.
 Exemption of working hours under section 64.

In making rules under this section, the State Government shall not exceed, except in
respect of exemption under clause (a) of sub-section (2), the following limits of work
inclusive of overtime:
(i) the total number of hours of work in any day shall not exceed ten;
(ii) the spread over, inclusive of intervals for rest, shall not exceed twelve hours in any
one day: Provided that the State Government may, in respect of any or all of the
categories of workers referred to in clause (d) of sub- section (2), make rules
prescribing the circumstances in which, and the conditions subject to which, the
restrictions imposed by clause (i) and clause (ii) shall not apply in order to enable a
shift worker to work the whole or part of a subsequent shift in the absence of a
worker who has failed to report for duty;
(iii) The total number of hours of work in a week, including overtime, shall not exceed
sixty;
(iv) the total number of hours of overtime shall not exceed fifty for any one quarter.
 Exemption of working hours under section 65.
(i) the total number of hours of work in any day shall not exceed twelve;
(ii) the spread over, inclusive of intervals for rest, shall not exceed thirteen hours in any
one day;
(iii) the total number of hours of work in any week, including overtime, shall not exceed
sixty;
(iv) no worker shall be allowed to work overtime, for more than seven days at a stretch
and the total number of hours of overtime work in any quarter shall not exceed
seventy-five.
B. Working hours for women

 The time and other aspects are same as the adult male.
 Certain further restrictions on employment of women.
1. The provisions of this Chapter shall, in their application to women in factories, be
supplemented by the following further restrictions, namely:
(a) no exemption from the provisions of section 54 may be granted in respect of any
woman (i.e. 9 hours a day);
(b) no woman shall be required or allowed to work in any factory except between the
hours of 6 a.m. and 7 p.m. Provided that the State Government may, by
notification in the Official Gazette in respect of any factory or group or class or
description of factories], vary the limits laid down in clause (b), but so that no
such variation shall authorise the employment of any woman between the hours
of 10 p.m. and 5 a.m.;
(c) there shall be no change of shifts except after a weekly holiday or any other
holiday.
2. The State Government may make rules providing for the exemption from the
restrictions set out in sub-section (1), to such extent and subject to such conditions as
it may prescribe, of women working in fish curing or fish canning factories, where the
employment of women beyond the hours specified in the said restrictions is necessary
to prevent damage to, or deterioration in, any raw material.
3. The rules made under sub-section (2) shall remain in force for not more than three
years at a time.
9. DISCUSS PROVISIONS AS REGARDS EMPLOYMENT OF YOUNG PERSON AND

CHILDREN IN FACTORIES.
a. Prohibition of employment of young children.
b. Non-adult workers to carry tokens.
c. Certificates of fitness.
d. Effect of certificate of fitness granted to adolescent
e. Working hours for children.
f. Notice of periods of work for children.
g. Register of child workers.
h. Hours of work to correspond with notice under section 72 and register under section 7.
i. Power to require medical examination.
j. Power to make rules.
k. Certain other provisions of law not barred.
a. Prohibition of employment of young children (section 67)

 No child who has not completed his fourteenth year shall be required or allowed to work in
any factory.
b. Non-adult workers to carry tokens (section 68)
 A child who has completed his fourteenth year or an adolescent shall not be required or
allowed to work in any factory unless.
(a) a certificate of fitness granted with reference to him under section 69 is in the custody of
the manager of the factory, and
(b) such child or adolescent carries while he is at work a token giving a reference to such
certificate.
c. Certificates of fitness (section 69)
 A certifying surgeon shall, on the application of any young person or his parent or guardian
accompanied by a document signed by a manager of a factory that such person will be
employed therein if certified to be fit for work in a factory, or on the application of the
manager of the factory in which any young person wishes to work, examine such person and
ascertain his fitness for work in a factory.
 The certifying surgeon, after examination, may grant to such young person, in the prescribed
form, or may renew-
(a) a certificate of fitness to work in a factory as a child, if he is satisfied that the young
person has completed his fourteenth year, that he has attained the prescribed physical
standards and that he is fit for such work;
(b) a certificate of fitness to work in a factory as an adult, if he is satisfied that the young
person has completed his fifteenth year, and is fit for full day’s work in a factory:
Provided that unless the certifying surgeon has personal knowledge of the place where
the young person proposes to work and of the manufacturing process in which he will
be employed, he shall not grant or renew a certificate under this sub-section until he has
examined such place.
 A certificate of fitness granted or renewed under sub-section (2)
(a) shall be valid only for a period of twelve months from the date thereof;
(b) may be made subject to conditions in regard to the nature of the work in which the
young person may be employed, or requiring re-examination of the young person before
the expiry of the period of twelve months.
 A certifying surgeon shall revoke any certificate granted or renewed under sub-section (2) if
in his opinion the holder of it is no longer fit to work in the capacity stated therein in a
factory.
 Where a certifying surgeon refuses to grant or renew a certificate or a certificate of the kind
requested or revokes a certificate, he shall, if so requested by any person who could have
applied for the certificate, or the renewal thereof, state his reasons in writing for so doing.
 Where a certificate under this section, with reference to any young person is granted or
renewed subject to such conditions as are referred to in clause (b) of sub-section (3), the
young person shall not be required or allowed to work in any factory except in accordance
with those conditions.
 Any fee payable for a certificate under this section shall be paid by the occupier and shall not
be recoverable from the young person, his parents or guardian.
d. Effect of certificate of fitness granted to adolescent (section 70)
(1) An adolescent who has been granted a certificate of fitness to work in a factory as an adult
under clause (b) of sub-section (2) of section 69 and who while at work in a factory carries
a token giving reference to the certificate, shall be deemed to be an adult for all the
purposes of Chapters VI and VII;
(2) No female adolescent or male adolescent who has attained the age of seventeen years but
who has been granted a certificate of fitness to work in a factory as an adult, shall be
required or allowed to work in any factory except between 6 a.m. and 7 p.m.: Provided that
the State Government may, by notification in the Official Gazette, in respect of any factory
or group or class or description of factories.
e. Working hours for children (section 71)
(1) No child shall be employed or permitted to work, in any factory- (a) for more than four and
a half hours in any day.
(2) During the night. Explanation.-For the purposes of this sub-section “night” shall mean a
period of at least twelve consecutive hours which shall include the interval between 10 p.m.
and 6 a.m.
(3) The period of work of all children employed in a factory shall be limited to two shifts
which shall not overlap or spread over more than five hours each; and each child shall be
employed in only one of the relays which shall not except with the previous permission in
writing of the Chief Inspector, be changed more frequently than once in a period of thirty
days.
(4) The provisions of section 52 shall apply also to child workers, and no exemption from the
provisions of that section may be granted in respect of any child.
(5) No child shall be required or allowed to work in any factory on any day on which he has
already been working in another factory.
(6) No female child shall be required or allowed to work in any factory except between 8 a.m.
and 7 p.m.
f. Notice of periods of work for children (section 72).
(1) There shall be displayed and correctly maintained in every factory in which children are
employed in accordance with the provisions of sub- section (2) of section 108 a notice of
periods of work for children, showing clearly for every day the periods during which
children may be required or allowed to work.
(2) The periods shown in the notice required by sub-section (1) shall be fixed beforehand in
accordance with the methods laid down for adult workers in section 61, and shall be such
that children working for those periods would not be in contravention of the provisions of
section 71.
(3) The provisions of sub-sections (8), (9) and (10) of section 61 shall apply also to the notice
required by sub-section (1) of this section.
g. Register of child workers (section 73).
(1) The manager of every factory in which children are employed shall maintain a register of
child workers, to be available to the Inspector at all times during working hours or when
any work is being carried on in a factory showing-
(a) the name of each child worker in the factory,
(b) the nature of his work,
(c) the group, if any, in which he is included,
(d) where his group works on shifts, the relay to which he is allotted, and
(e) the number of his certificate of fitness granted under section 69.
(2) No child worker shall be required or allowed to work in any factory unless his name and
other particulars have been entered in the register of child workers.
(3) The State Government may prescribe the form of the register of child workers, manner in
which it shall be maintained and the period for which it shall be preserved.
h. Hours of work to correspond with notice under section 72 and register under section 73
(section 74). No child shall be employed in any factory otherwise than in accordance with the
notice of periods of work of children displayed in the factory and the entries made before hand
against his name in the register of child workers of the factory.
i. Power to require medical examination (section 75)
Where an Inspector is of the opinion-
(a) that any person working in a factory without a certificate of fitness is a young person, or
(b) that a young person working in a factory with a certificate of fitness is no longer fit to work
in the capacity stated therein,- he may serve on the manager of the factory a notice
requiring that such person or young person, as the case may be, shall be, examined by a
certifying surgeon, and such person or young person shall not, if the Inspector so directs, be
employed, or permitted to work, in any factory until he has been so examined and has been
granted a certificate of fitness or a fresh certificate of fitness, as the case may be, under
section 69, or has been certified by the certifying surgeon examining him not to be a young
person.
j. Power to make rules (section 76)
The State Governments may make rules-
(a) prescribing the forms of certificate of fitness to be granted under section 69, providing for
the grant of duplicates in the event of loss of the original certificates, and fixing the fees
which may be charged for such certificates and renewals thereof and such duplicates;
(b) prescribing the physical standards to be attained by children and adolescents working in
factories;
(c) regulating the procedure of certifying surgeons under this Chapter;
(d) specifying other duties which certifying surgeons may be required to perform in connection
with the employment of young persons in factories and fixing the fees which may be
charged for such duties and the persons by whom they shall be payable.
k. Certain other provisions of law not barred (section 77)
The provisions of this Chapter shall be in addition to, and not in derogation of, the provisions of
the Employment of Children Act, 1938 (26 of 1938).
UNIT 3
10. DISCUSS ANNUAL LEAVE WITH WAGES.

 Application of Chapter.
(1) The provisions of this Chapter shall not operate to the prejudice to any right to which a
worker may be entitled under any other law or under the terms of any award agreement
including settlement or contract of service: Provided that if such award agreement
including settlement or contract of service provides for a longer annual leave with wages
than provided in this Chapter, the quantum of leave, which the worker shall be entitled to,
shall be in accordance with such award, agreement or contract of service, but in relation to
matters not provided for in such award, agreement or contract of service or matters which
are provided for less favourably therein, the provisions of sections 79 to 82 so far as may
be, shall apply.
(2) The provisions of this Chapter shall not apply to workers in any factory of any railway
administered by the Government, who are governed by leave rules approved by the Central
Government.
 Section 79. Annual leave with wages.
(1) Every worker who has worked for a period of 240 days or more in a factory during a
calendar year shall be allowed during the subsequent calendar year leave with wages for a
number of days calculated at the rate of:
(i) if an adult, one day for every twenty days of work performed by him during the
previous calendar year;
(ii) if a child, one day for every fifteen days of work performed by him during the
previous calendar year.
Explanation 1: For the purpose of this sub-section
(a) any days of lay-off, by agreement or contract or as permissible under the standing
orders;
(b) in the case of a female worker, maternity leave for any number of days not exceeding
twelve weeks; and
(c) the leave earned in the year prior to that in which the leave is enjoyed; shall be deemed
to be days on which the worker has worked in a factory for the purpose of
computation of the period of 240 days or more, but he shall not earn leave for these
days.
Explanation 2: The leave admissible under this sub-section shall be exclusive of all
holidays whether occurring during or at either end of the period of leave.
(2) A worker whose service commences otherwise than on the first day of January shall be
entitled to leave with wages at the rate laid down in clause (i) or, as the case may be, clause
(ii) of sub-section (1) if he has worked for two-thirds of the total number of days in the
remainder of the calendar year.
(3) If a worker is discharged or dismissed from service or quits his employment or is
superannuated or dies while in service, during the course of the calendar year, he or his heir
or nominee, as the case may be, shall be entitled to wages in lieu of the quantum of leave to
which he was entitled immediately before his discharge, dismissal, quitting of employment,
superannuation or death calculated at the rates specified in sub-section (1), even if he had
not worked for the entire period specified in sub- section (1) or sub-section (2) making him
eligible to avail of such leave, and such payment shall be made:
(i) where the worker is discharged or dismissed or quits employment, before the expiry of
the second working day from the date of such discharge, dismissal or quitting; and
(ii) where the worker is superannuated or dies while in service, before the expiry of two
months from the date of such superannuation or death.
(4) In calculating leave under this section, fraction of leave of half a day or more shall be
treated as one full day’s leave, and fraction of less than half a day shall be omitted.
(5) If a worker does not in any one calendar year take the whole of the leave allowed to him
under sub-section (1) (2), as the case may be, any leave not taken by him shall be added to
leave to be allowed to him in the succeeding calendar year: Provided that the total number
of days of leave that may be carried forward to a succeeding year shall not exceed thirty in
the case of an adult or forty in the case of child: Provided further that a worker, who has
applied for leave with wages but has not been given such leave in accordance with any
scheme laid down in subsections (8) and (9) or in contravention of sub-section (10) shall be
entitled to carry forward the leave refused without any limit.
(6) A worker may at any time apply in writing to the manager of a factory not less than fifteen
days before the date on which he wishes his leave to begin, to take all the leave or any
portion thereof allowable to him during the calendar year: Provided that the application
shall be made not less than thirty days before the date on which the worker wishes his leave
to begin, if he is employed in public utility service as defined in clause (n) of section 2 of
the Industrial Disputes Act, 1947 (14 of 1947): Provided further that the number of times in
which leave may be taken during any year shall not exceed three.
(7) If a worker wants to avail himself of the leave with wages due to him to cover a period of
illness, he shall be granted such leave even if the application for leave is not made within
the time specified in sub-section (6); and in such a case wages as administrative under
section 81 shall be paid not later than fifteen days, or in the case of a public utility service
not later than thirty days from the date of the application for leave.
(8) For the purpose of ensuring the continuity of work, the occupier or manager of the factory,
in agreement with the Works Committee of the factory constituted under section 3 of the
Industrial Disputes Act, 1947 (14 of 1947) or a similar Committee constituted under any
other Act or if there is no such Works Committee or a similar Committee in the factory in
agreement with the representatives of the workers therein chosen in the prescribed manner,
may lodge with Chief Inspector a scheme in writing whereby the grant of leave allowable
under this section may be regulated.
(9) A scheme lodged under sub-section (8) shall be displayed at some conspicuous and
convenient places in the factory and shall be in force for a period of twelve months from
the date on which it comes into force, and may thereafter be renewed with or without
modification for a further period of twelve months at a time, by the manager in agreement
with the Works Committee or a similar Committee, or as the case may be, in agreement
with the representatives of the workers as specified in sub-section (8), and a notice of
renewal shall be sent to the Chief Inspector before it is renewed.
(10) An application for leave which does not contravene the provisions of sub-section (6) shall
not be refused unless refusal is in accordance with the subscheme for the time being in
operation under sub-sections (8) and (9).
(11) If the employment of a worker is entitled to leave under section (1) or sub-section (2) as the
case may be, is terminated by the occupier before he has taken the entire leave to which he
is entitled, or if having his applied for and having not been granted such leave, the worker
quits his employment before he has taken the leave, the occupier of the factory shall pay
him the amount payable under section 80 in respect of the leave not taken, and such
payment shall be made, where the employment of the worker is terminated by the occupier,
before the expiry of the second working day after such termination and where a worker
who quits the employment, on or before the next pay day. ‘
(12) The unavailed leave of a worker shall not be taken into consideration in computing the
period of any notice required to be given before discharge or dismissal.
 Section 80. Wages during leave period.
(1) For the leave allowed to him under section 78 or section 79, as the case may be, a worker
shall be entitled to wages] at a rate equal to the daily average of his total full time earnings
for the days on which he actually worked during the month immediately proceeding his
leave, exclusive of any overtime and bonus but inclusive of dearness allowance and the
cash equivalent of the advantage accruing through the concessional sale to the worker of
food grains and other articles: Provided that in the case of a worker who has not worked on
any day during the calendar month immediately preceding his leave, he shall be paid at a
rate equal to the daily average of his total full time earnings for the days on which he
actually worked during the last calendar month proceeding his leave, in which he actually
worked, exclusive of any overtime and bonus but inclusive of dearness allowance and the
cash equivalent of the advantage accruing through the concessional sale to the workers of
food grains and other articles.]
(2) The cash equivalent of the advantage accruing through the concessional sale to the worker
of food grains and other articles shall be computed as often as may be prescribed on the
basis of the maximum quantity of food grains and other articles admissible to a standard
family.
Explanation 1: Standard family means a family consisting of worker, his or her spouse and
two children below the age of fourteen years requiring in all three adult consumption units.
Explanation 2: Adult consumption unit’ means the consumption unit of a male above the
age of fourteen years and the consumption unit of a female above the age of fourteen years
and that of a child below the age of fourteen years shall be calculated at the rates of 0.8 and
0.6 respectively of one adult, consumption unit.
(3) The State Government may make rules prescribing-
(a) the manner in which the cash equivalent of the advantage accruing through the
concessional sale to a worker of food grains and other articles shall be computed; and
(b) the registers that shall be maintained in a factory for the purpose of securing
compliance with the provisions of this section.
 Section 81: Payment in advance in certain cases: A worker who has been allowed leave for
not less than four days in the case of adult, and five days in the case of a child shall before his
leave begins, be paid the wages due for the period of the leave allowed.
 Section 82: Mode of recovery of unpaid wages: Any sum required to be paid by an employer
under this Chapter but not paid by him shall be recoverable as delayed wages under the
provisions of the Payment of Wages Act, 1936 (4 of 1936).
 Section 83: Power to make rules: The State Government may make rules directing managers
of factories to keep registers containing such particulars as may be prescribed and requiring the
registers to be made available for examination by Inspector.
 Section 84: Power to exempt factories: Where the State Government is satisfied that the leave
rules applicable to workers in a factory provided benefits which in its opinion are not less
favourable than those for which this Chapter makes provisions if may by written order exempt
the factory from all or any of the provisions of this Chapter subject to such conditions as may be
specified in the order. Explanation: For the purposes of this section, in deciding whether the
benefits which are provided for by any leave rules are less favourable than those for which this
Chapter
11. EXPLAIN PENALTIES AND PROCEDURE UNDER FACTORIES ACT, 1948

 Section 92. General penalty for offences: Save as otherwise expressly provided in this Act the
occupier and manager of the factory shall each be guilty of an offence and punishable with
imprisonment for a term which may extend to two years or with fine which may extend to one
lakh rupees or with both and if the contravention is continued after conviction, with a further
fine which may extend to one thousand rupees for each day on which the contravention is so
continued: Provided that where contravention of any of the provisions of Chapter IV or any rule
made thereunder or under section 87 has resulted in an accident causing death or serious bodily
injury, the fine shall not be less than twenty five thousand rupees in the case of an accident
causing death, and 8[five thousand rupees] in the case of an accident causing serious bodily
injury. Explanation: In this section and in section 94 “serious bodily injury” means an injury
which involves, or in all probability will involve, the permanent loss of the use of, or permanent
injury to, any limb or the permanent loss, of, or, injury to, sight or hearing, or the fracture of any
bone, but shall not include the fracture of bone or joint (not being fracture of more than one
bone or joint) of any phalanges of the hand or foot.
 Section 93. Liability of owner of premises in certain circumstances.
(1) Where in any premises separate buildings are leased to different occupiers for use as
separate factories, the owner of the premises shall be responsible for the provision and
maintenance of common facilities and services such as approach roads, drainage, water
supply, lighting and sanitation.
(2) The Chief Inspector shall have, subject to the control of the State Government power to
issue orders to the owner of the premises in respect for the carrying out the provisions of
sub-section (1).
(3) Where in any premises, independent or self-contained, floors or flats are leased to different
occupiers for use as separate factories, the owner of the premises shall be liable as if he
were the occupier or manager of a factory, of any contravention of the provisions of this
Act in respect of- (i) latrines, urinals and washing facilities in so far as the maintenance of
the common supply of water for these purposes is concerned; (ii) fencing of machinery and
plant belonging to the owner and not specifically entrusted to the custody or use of an
occupier; (iii) safe means of access to the floors of flats, and maintenance and cleanliness
of staircases and common passages; (iv) precautions in case of fire; (v) maintenance of
hoists and lifts; and (vi) maintenance of any other common facilities provided in the
premises.
issue orders to the owner of the premises in respect of carrying out the provisions of sub-
section (3).
(5) The provisions of sub-section (3) relating to the liability of the owner shall apply where in
any premises independent rooms with common latrines, urinals and washing facilities are
leased to different occupiers for use as separate factories: Provided that the owner shall be
responsible also for complying with the requirements relating to the provisions and
maintenance of latrines, urinals and washing facilities.
(6) The Chief Inspector shall have, subject to the control of the State Government, the power to
issue order to the owner of the premises referred to in sub-section (5) in respect of the
carrying out the provisions of section 46 or section 48.
(7) Where in any premises portions or room or a shed are leased to different occupiers for use
as separate factories, the owner of the premises shall be liable for any contravention of the
provisions of- (i) Chapter III, except sections 14 and 15; (ii) Chapter IV, except sections
22, 23, 27, 34, 35 and 36: Provided that in respect of the provisions of sections 21, 24 and
32 the owner’s liability shall be only in so far as such provisions relate to things under his
control: Provided further that the occupier shall be responsible for complying with the
provisions of Chapter IV in respect of plant and machinery belonging to or supplied by
him. (iii) Section 42.
issue orders to the owner of the premises in respect of the carrying out of the provisions of
sub-section (7).
(9) In respect of sub-sections (5) and (7) while computing for the purposes of any of the
provisions of this Act the total number of workers employed, the whole of the premises
shall be deemed to be a single factory.
 Section 94. Enhanced penalty after previous conviction:
(1) If any person who has been convicted of any offence punishable under section 92 is again
guilty of an offence involving a contravention of the same provisions he shall be
punishable on a subsequent conviction with imprisonment for a term which may extend to
three years or with fine which shall not be less than ten thousand rupees but which may
extend to two lakh rupees or with both: Provided that the court may, for any adequate and
special reasons to be mentioned in the judgment impose a fine of less than ten thousand
rupees: Provided further that where contravention of any of the provisions of Chapter IV or
any rule made thereunder or under section 87 has resulted in an accident causing death or
serious bodily injury, the fine shall not be less than thirty-five thousand rupees in the case
of an accident causing death and ten thousand rupees in the case of an accident causing
serious bodily injury.
(2) For the purposes of sub-section (1), no cognizance shall be taken of any conviction made
more than two years before the commission of the offence for which the person is
subsequently being convicted.
 Section 95. Penalty for obstructing Inspector: Whoever wilfully obstructs an Inspector in the
exercise of any power conferred on him by or under this Act or fails to produce on demand by
an Inspector any registers or other documents in his custody kept in pursuance of this Act or of
any rules made thereunder or conceals or prevents any worker in a factory from appearing
before, or being examined by an Inspector, 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.
 Section 96. Penalty for wrongfully disclosing results of analysis under section 91: however,
except in so far as it may be necessary for the purposes of a prosecution for any offence
punishable under this Act, publishes or discloses to any person the results of an analysis made
under section 91, shall be punishable with imprisonment for a term which may extend to 3[six
months] or with fine which may extend to ten thousand rupees or with both.
 Section 96A. Penalty for contravention of the provisions of Sections 41B, 41C 41C and
41H:
a. Whoever fails to comply with or contravenes any of the provisions of sections 41B, 41C or
41H or the rules made thereunder, shall, in respect of such failure or contravention, be
punishable with imprisonment for a term which may extend to seven years and with fine
which may extend to two lakh rupees, and in case the failure or contravention continues,
with additional fine which may extend to five thousand rupees for every day during which
such failure or contravention continues after the conviction for the first such failure or
contravention.
b. If the failure or contravention referred to in sub-section (1) continues beyond a period of one
year after the date of conviction, the offender shall be punishable with imprisonment for a
term which may extend to ten years.
 Section 97. Offences by workers:
(1) Subject to the provisions of section 111, if any worker employed in a factory contravenes
any provision of this Act or any rules or orders made thereunder, imposing any duty or
liability on workers he shall be punishable with fine which may extend to five hundred
rupees.
(2) Where a worker is convicted of an offence punishable under sub-section (1) the occupier or
manager of the factory shall not be deemed to be guilty of an offence in respect of that
contravention, unless it is proved that he failed to take all reasonable measures for its
prevention. 98. Penalty for using false certificates of fitness.- Whoever knowingly uses or
attempts to use, as a certificate of fitness granted to himself under section 70, a certificate
granted to another person under that section, or who having procured such a certificate,
knowingly allows it to be used, or an attempt to use it to be made, by another person, shall
be punishable with imprisonment for a term which may extend to 7[two months] or with
fine which may extend to one thousand rupees or with both.
 Section 99. Penalty for permitting double employment of child: If a child works in a factory
on any day on which he has already been working in another factory the parent or guardian of
the child or the person having custody of or control over him or obtaining any direct benefit
from his wages, shall be punishable with fine which may extend to 1[one thousand rupees],
unless it appears to the Court that the child so worked without the consent or connivance of such
parent, guardian or person.
 Section 101. Exemption of occupier or manager from liability in certain cases: Where the
occupier or manager of a factory is charged with an offence punishable under this Act, he shall
be entitled, upon complaint duly made by him and on giving to the prosecutor not less than three
clear days’ notice in writing of his intention so to do, 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 occupier or manager of the factory,
as the case may be, proves 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 like punishment as if he were the occupier or manager of the
factory, and the occupier or manager, as the case may be, shall be discharged from any liability
under this Act in respect of such offence: Provided that in seeking to prove as aforesaid, the
occupier or manager of the factory, as the case 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 occupier or manager 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 occupier or manager and shall, if the offence be proved,
convict the occupier or manager.
 Section 102. Power of Court to make orders:
(1) Where the occupier or manager of a factory is convicted of an offence punishable under
this Act 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 such behalf, from time to time extend) to take such measures as may be so
specified for remedying the matters in respect of which the offence was committed.
(2) Where an order is made under sub-section (1), the occupier or manager of the factory, as
the case may be, 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 occupier or manager, as the case may be, shall be deemed to
have committed a further offence, and may be sentenced therefore by the Court to undergo
imprisonment for a term which may extend to six months or to pay a fine which may
extend to one hundred rupees for every day after such expiry on which the order has not
been complied with, or both to undergo such imprisonment and to pay fine, as aforesaid.
 Section 103. Presumption as to employment: If a person is found in a factory at any time,
except during intervals for meals or rest, when work is going on or the machinery is in motion,
he shall until the contrary is proved be deemed for the purposes of this Act and the rules made
thereunder to have been at that time employed in the factory.
 section104. Onus as to age:
(1) When any act or omission would, if a person were under a certain age, be an offence
punishable under this Act, and such person is in the opinion of the Court prima facie under
such age, the burden shall be on the accused to prove that such person is not under such
age.
(2) A declaration in writing by a certifying surgeon relating to a worker that he has personally
examined him and believes him to be under the age stated in such declaration shall, for the
purposes of this Act and the rules thereunder, be admissible as evidence of the age of that
worker.
 Section 104A. Onus of proving limits of what is practicable, etc.- In any proceeding for an
offence for the contravention of any provision of this Act or rules made thereunder consisting of
a failure to comply with a duty or requirement to do something, it shall be for the person who is
alleged to have failed to comply with such duty or requirement, to prove that it was not
reasonably practicable, or, as the case may be, all practicable measures were taken to satisfy the
duty or requirement.
 Section 105. Cognizance of offences.
(1) No Court shall take cognizance of any offence under this Act except on complaint by, or
with the previous sanction in writing of, an Inspector.
(2) No Court below that of a Presidency Magistrate or of a Magistrate or of the first class try
any offence punishable under this Act.
 Section 106. Limitation of prosecutions: No Court shall take cognizance of any offence
punishable under this Act unless complaint thereof is made within three months of 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. Explanation.-For the purposes of this section- (a) in the case of a continuing
offence, the period of limitation shall be computed with reference to every point of time during
which the offence continues; (b) where for the performance of any act time is granted or extend
on an application made by the occupier or manager of a factory the period of limitation shall be
computed from the date on which the time so granted or extended expired.]
 Section 106A. Jurisdiction of a court for entertaining proceedings, etc. for offence: For the
purposes of conferring jurisdiction on any court in relation to an offence under this Act or the
rules made thereunder in connection with the operation of any plant, the place where the plant is
for the time being situate shall be deemed to be the place where such offence has been
committed.
UNIT 4
12. DISCUSS THE SALIENT FEATURES OF THE EMPLOYEES COMPENSATION ACT,

1923
1. The Act has been modified on the lines of English legislation. Under the Act, the employers are
under obligation to pay compensation to those employees who are entitled to claim benefit
under this Act.
2. The workman or his dependents may claim compensation if the injury has been caused by
accident, arising out of and in the course of employment but a workman loses his right to
compensation if such accident be attributed to workman, having been at the time of the accident
under the influence of drink or drugs if it is caused by his wilful disobedience of rulers or orders
or disregard of safety devices.
3. Various classes of workers have been specified in the definition of workman in section 2(1) and
in Schedule II. Persons employed in administration (or clerical capacity) and earning more than
Rs. 1600 per month (except railway servants) were excluded from the benefit of the Act.
4. The amount of compensation payable to a workman or his dependents depends on the result of
the injury and the nature of disablement and which will be determined by a reference to average
monthly wages and schedule IV.
5. The term wages as defined in the act includes overtime, pay and the value of concessions or
benefit in the form of food, clothing, free quarters, etc.
6. In case of fatal accidents, the following procedure is provided in the Act:
1. All cases of fatal accidents are to be brought to the notice of commissioner.
2. In case of admission of liability, by the employer, the amount of compensation is to be
deposited with the commissioner.
3. If the employer denies his liability, the commissioner must decide whether or not there is a
ground for claim. The commissioner may inform the dependents and it is open to them to
prefer a claim or not.
7. A sub-contractor may indemnify his contractor if he has to pay compensation either to a
principal or to a workman.
8. Out of the compensation the commissioner is authorized to deduct a sum of Rs. 50 and pay the
same to the person who has incurred funeral expenses of deceased workman.
9. The Act is administered by the commissioner for workman’s compensation appointed by the
State Government.
10. The worker cannot claim benefits under this Act and ESI Act together.
13. EXPLAIN WHO IS AN EMPLOYEE, DEPENDENT AND EMPLOYER IN EMPLOYEES

COMPENSATION ACT, 1923
EXPLAIN THE TERM COMPENSATION. DEFINE DEPENDENTS AND WORKMAN
UNDER THE ACT.
EMPLOYEE OR WORKMAN:
- Employee means any person (other than a person whose employment is of a casual nature and
who is employed otherwise than for the purposes of the employer’s trade or business) who is -
1. a railway servant as defined in section 3 of the Indian Railways Act, 1890 (9 of 1890), 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
2. 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 the workman is dead, include a reference to his
dependents or any of them.
3. A master, seaman or other member of the crew of a ship.
A captain or other member of the crew of an aircraft.
A person recruited as driver, helper, mechanic, cleaner, or in any other capacity in
connection with a motor vehicle.
A person recruited for work abroad by a company.
DEPENDENT:
- “Dependent” means any of the following relatives of a deceased workman, namely:
1. a widow, a minor legitimate son, and unmarried legitimate daughter, or a widowed mother;
and
2. if wholly dependent on the earnings of the workman at the time of his death, a son or a
daughter who has attained the age of 18 years and who is infirm;
3. if wholly or in part dependent on the earnings of the workman at the time of his death,
(a) a widower,
(b) a parent other than a widowed mother,
(c) a minor illegitimate son, an unmarried illegitimate daughter or a daughter legitimate or
illegitimate if married and a minor or if widowed and a minor,
(d) a minor brother or a unmarried sister or 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;
Judicial Views:
1. Even after remarriage a window remains dependent within the meaning of the
Employee’s compensation Act, 1923.
2. Relationship of mother and son is not destroyed even if the mother remarries.
3. The expression widowed mother does not include widowed step mother.
4. Minor brother includes uterine brother.
5. An illegitimate child born of an adulterous intercourse is a dependent when it appears
that child is supported by putative father (supposed or reputed).
EMPLOYER:
- “Employer” includes:
b. any body of persons whether incorporated or not and
c. any managing agent of an employer and
d. the legal representative of a deceased employer, and,
when the services of 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;
14. EXPLAIN EMPLOYER’S LIABILITY TO PAY COMPENSATION WITH REFERENCE

TO EMPLOYEES COMPENSATION ACT, 1923.
EXPLAIN ACCIDENT ARISING OUT OF AND IN THE COURSE OF EMPLOYMENT.
OCCUPATIONAL DISEASES.
DISCUSS WITH JUDGMENTS NOTIONAL EXTENSION THEORY UNDER THE
WORKMEN COMPENSATION ACT.
 Before the employers compensation Act, if there was any injury the workmen had to file a suit
in court and establish three things:
a. That the injury was the result of an accident with his employment.
b. That the employer was somehow responsible for the accident.
c. He had to establish the amount of compensation due to this injury.
This process was lengthy and costly.
 Important Characteristic and objects of the Act
a. The employer’s compensation Act is social welfare legislation. It imposes statutory liability
on the employer.
b. To discharge his moral obligation towards his employee when they suffer from physical
disabilities or diseases during the course of employment in hazardous occupations. The Act
also helps the dependents of the employee rendered destitute by the accident and from the
hardships arising out of accidents.
c. The Act provides for speedy and cheaper mode of disposal of disputes relating to
compensation through special proceedings rather than the civil law.
 The Act extends to the whole of India.
EMPLOYER’S LIABILITY FOR COMPENSATION - Section 3(1).

- The liability of an employer to pay compensation is limited and is subject to the provisions of
this Act. Under sub-section (1) of section (3) the liability of the employer to pay compensation
is dependent upon the following four conditions:
1. Personal injury must have been caused to a workman;
2. Such injury must have been caused by an accident;
3. The accident must have arisen out of and in the course of employment; and
4. The injury must have resulted either in death of the workman or in his total or partial
disablement for a period exceeding three days.
- The employer shall not be liable to pay compensation in the following cases
1. If the injury did not result in total or partial disablement of the workman for a period
exceeding three days;
2. In respect of any injury not resulting in death or permanent total disablement the employer
can plead:
a. that the workman was at the time of accident under the influence of drinks or drugs;
b. that the workman wilfully disobeyed an order expressly given or a rule expressly framed
for the purpose of securing safety of workmen ; and
c. that the workman having known that certain safety-guards or safety devices are
specifically provided for the purpose of securing the safety of workman, wilfully
disregarded or removed the same.
- 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.
The employer’s liability to pay compensation is dependent upon the following conditions:
d. Personal injury to the workman.
e. Injury must have been caused by accident.
f. The accident must have been arisen out of and in the course of employment.
g. The injury must have been resulted in the workman’s death or permanent or temporary,
total or partial disablement for a period exceeding three days.
Defenses available are to an employer are: Employer shall not be so liable:
(a) When the injury which does not result in the total or partial disablement of the workman
for a period exceeding 3 days;
(b) When the injury, not resulting in death, caused by an accident which is directly
attributable to
(i) the workman was at the time of accident under the influence of drink or drugs, or
(ii) the employee willfully disobeyed an order expressly given, or to a rule expressly
framed, for the purpose of securing the safety of workmen, or
(iii) the employee willful removes or disregards any safety guard or other device which
he knew to have been provided for the purpose of securing the safety of workmen.
- The employer can succeed in his plea if he can prove that the injury was directly
attributable to any one of the above factors. But if the workman dies on account of such
injury, the employer is liable to pay compensation in spite of the above exceptions.
- Physical injury includes physiological and psychological injury such as shock, mental
injury, and lunacy. It is wider than physical injury.
- Occupational diseases are the diseases contracted by workman because of the occupation
followed by him.
Employer’s liability to pay compensation in case of occupational diseases

- Employees employed in certain occupations are exposed to certain diseases which are inherent
in those occupations. Contracting of occupational diseases is deemed to be an injury by accident
and is deemed to be arisen out of employment and in the course of employment.
Schedule III fives the list of occupational diseases. This schedule is divided into three parts. Part
A, B, C.
Part A gives list of occupational diseases and contracting of such disease is deemed to be an
injury by accident and is deemed to be arisen out of employment and in the course of
employment.
Part B gives a list of occupational diseases and contracting of such disease is deemed to be an
employment if an employee was employed for a continuous period of not less than six months
or more.
Part C gives a list of occupational diseases and contracting of such disease is deemed to be an
employment whilst in the service of one or more employers contracts any disease.
The injury or accident must arise out of employment and arise in the course of
employment:
Personal injury: Injury ordinarily refers to a physiological injury. Personal injury does not
mean only physical or bodily injury but includes even a nervous shock, a mental injury or strain
which causes a chill. It is a term wider than bodily injury. In Indian News Chronicle v/s Mrs.
Lazarus, a workman, employed as an electrician had frequently to go to a heating room from a
cooling plant, was attacked by pneumonia and died after a short illness of five days. The Court
held that the injury caused by an accident is not confined to physical injury and the injury in the
instant case was due to his working and going from a heating room to a cooling plant as it was
his indispensable duty arising out of and in the course of employment.
(a) Arising out of employment: that the risk is incidental to the work for which worker was
engaged then injury arises out of employment. They disease or injury must have causal
connection between the employment and the accidental injury.
(b) Arise in the course of employment: if the injury is caused during the period of time for
which workman was employed then injury arises in the course of employment. He was
doing his master’s job. It includes:
- The time the workman uses the transport provided by the employer in the course of
employment.
- It includes the time when the workman is in the premises of the employer, though not
actually at work.
- The period of rest within the employer’s premises is also included in the course of
employment.
- A workman reaches the place of employment before the time when the employment begins,
if it is at the direction of the employer, then the period shall also be included in course of
employment.
- If a workman lives at some distance from the place of employment with the permission of
the employer, the reasonable time of his going to and coming from the place of employment
shall be included in the course of employment.
Notional extension of employment:
- In certain circumstances an employer is liable for injury to his workman even when the
employee is away from the premises at the time of injury. This is notional extension of
employment. It was laid down in Saurashtra Salt Mfg. Co. v/s Bai Valu Raja AIR (1958) SC
88.
- As a rule the employment of a workman does not commence until he has reached the place
of employment and does not continue when he has left the place of employment. The journey
to and from the place of work is excluded from the notion of employment. But now it is clear
from the notional extension of employment that it extends further in time and place.
- It must be proved that the accident took place when employee was doing his master’s job.
‘Duty’ not limited to commencement of work and laying down tools. It extends further in
point in point of time as well as place. There must be nexus between time and place of the
accident and the employment.
- An employee while returning home after duty was murdered within the premises of the
employer. It was held that there was casual and proximate connection between the accident
and the employment. Naima Bibi v/s Lodhne Colliery.
- In brief the law relating to notional extension may be summed as:
1. There must be an obligation, express or implied, upon the employer to provide transport
to and from the work spot and a reciprocal obligation upon the workman to avail that
transport.
2. The transport facility must not only be in the nature of a concession or privilege which
the workman are free to avail or not.
3. Where the means of transport provided by the employer, is not only the most convenient
means but also the only means to reach the place of work, there would be deemed to be
an implied obligation on the employer to provide that transport and a reciprocal
obligation on workman to avail it
4. In case of an accident taking place on a public road, the employer would be liable only if
the employment of the workman required him to be there. The distance of the place of
accident from the place of work is immaterial in such cases.
- In order to disown any claim for compensation the employer has to show not only
disobedience of rules and safety devices but such disobedience must be wilful and the order
must be express.
- Contributory negligence on the part of the workman does not exonerate the master from his
liabilities to pay compensation.
Employer not bound to give compensation if

- No compensation shall be payable to a workman in respect of any disease unless the disease is
directly attributable to a specific injury by accident arising out of and in the course of his
employment.
- 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:
(a) if he has instituted a claim to compensation in respect of the injury before a Commissioner;
or
(b) 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.
- In case of an injury caused by an accident a workman has the following alternative remedies:
1. He can claim compensation under this Act.
2. He can claim damages in torts.
3. He can claim under the employer’s liability Act.
He cannot claim compensation twice for the same injury.
Employer liable when contractor is engaged
- Sometimes, employer may engage a contractor instead of employing his own employee for the
purpose of doing any work in respect of his trade or business. Such a contractor then executes
the work through employee engaged by him. If any injury is caused by an accident to any of
these workers, then principal employer is liable.
- Section 12 makes the principal employer liable for compensation to such workmen hired by the
contractor under the following conditions.
a. The contractor is engaged to do a work which is part of the trade or business of the principal
employer.
b. The workmen were engaged in the course of or for the purpose of his trade or business.
c. The accident occurred in or about the premises on which the principal employer has
undertaken or undertakes to execute the work concerned.
- The amount of compensation shall be calculated with reference to the wages of the employee
under the employer by whom he is immediately employed.
- Where the principal is liable to pay compensation under this section, he shall be entitled to
indemnify by the contractor. The can recover from the contractor.
Employer liable to pay compensation where a workman contracts any disease after he has left
his employment in the following conditions.
- After a continuous 6 months service.
- After cessation of his service contracted any such disease (Part B Schedule III).
- It is proved that such disease arose out of the employment.
15. EXPLAIN TOTAL DISABLEMENT AND PARTIAL DISABLEMENT WITH

REFERENCE TO EMPLOYEES COMPENSATION ACT, 1923.
- Total and partial disablement means disablement which reduces the earning capacity of a
workman.
- Injury caused to a workman by an accident resulting in the loss of earning capacity is
technically called disablement.
- Disablement whether permanent or temporary is said to be total when it incapacitates a
workman for all work he was capable of doing at the time of accident in such disablement.
- The test of disablement is the reduction in the earning capacity of a workman. If the earning
capacity of the workman is reduced in relation to the employment, he had been at the time of the
accident resulting in such disablement; it is temporary partial disablement. If the injury caused
by an accident results in the reduction of earning capacity in every employment which such
workman was capable of undertaking at the time of accident it is permanent partial disablement.
PARTIAL DISABLEMENT
- Partial disablement can be classified as temporary partial disablement and permanent partial
disablement.
- Temporary Partial Disablement:
 It reduces the earning capacity of an employee in the employment in which he was engaged
at the time of the accident.
- Permanent Partial Disablement:
 It reduces earning capacity in every employment which an employee was capable of
undertaking at the time. Every injury in Part II of Schedule I shall be deemed to result in
permanent partial disablement.
 List of injuries deemed to result in permanent partial disablement are:
Amputation cases-upper limbs (either arm).
1. Amputation through shoulder joint = 90 (Percentage of loss of earning capacity)
2. Amputation below shoulder with stump less than 8” from 80 tip of acromion = 30
3. Amputation from 8” from tip of acromion to less than 4.5” below tip of olecranon = 70
4. Loss of a hand or of the thumb and four fingers of one hand or amputation from 4.5”
below tip of olecranon = 60
5. Loss of thumb = 30
6. Loss of thumb and its metacarpal bone = 40
7. Loss of four fingers of one hand = 50
8. Loss of three fingers of one hand = 30
9. Loss of two fingers of one hand = 20
10. Loss of terminal phalanx of thumb = 20
TOTAL DISABLEMENT
- Total disablement means such disablement which incapacitates an employee for all work which
he was capable of performing at the time of accident resulting in such disablement.
- Total disablement may be temporary or permanent.
- Deemed permanent total disablement are every injury specified in Part I of Schedule I and any
combination of injuries specified in Part II of Schedule I if the aggregate percentage of loss of
earning against these injuries amount to 100% or more.
- List of injuries deemed to result in permanent total disablement:
1. Loss of both hands or amputation at higher sites = 100 (Percentage of loss of earning
capacity)
2. Loss of a hand and a foot = 100
3. Double amputation through leg or thigh, or amputation through leg or thigh on one side and
loss of other foot = 100
4. Loss of sight to such an extent as to render the claimant unable to perform any work for
which eye sight is essential = 100
5. Very severe facial disfigurement = 100
6. Absolute deafness = 100
- An employee was carpenter and in the course of employment he suffered an injury which
resulted amputation of his left hand from elbow. It was held that the disablement was total as a
carpenter cannot work with one hand (Pratap Narain Singh Deo v/s Sriniwas Sabata).
16. EXPLAIN THE METHOD OF CALCULATION OF WAGES AND FATAL ACCIDENT

UNDER EMPLOYEES COMPENSATION ACT, 1923.
WAGES
- Wages includes any privilege or benefit which is capable of being estimated in money, other
than a 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.
- Privilege or benefit are:
1. Free accommodation.
2. Maternity benefit payable to a woman delivering a child.
3. Dearness allowance.
4. Overtime pay.
5. Benefits in the form of food or clothing.
6. Value of any other concession, benefits or privileges capable of being estimated in money.
7. Gratuity payable to a workman on retirement.
8. Bonus earned on the date of accident.
- The following are not wages: travelling allowances, contribution towards pension, contribution
towards provident fund, special expenses incurred by nature of employment, leave carried
forward to the next year.
METHOD OF CALCULATING WAGES.

- Section 5 speaks about 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 preceding 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 to 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 by 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
preceding the accident from the employer who is liable to pay compensation, divided by the
number of days comprising such period. Explanation: A period of service shall, for the
purposes of this section be deemed to be continuous which has not been interrupted by a
period of absence from work exceeding fourteen days.
17. DISCUSS AMOUNT OF COMPENSATION UNDER THE EMPLOYEES

COMPENSATION ACT, 1923
- Compensation is payable to an employee depends upon:
1. Nature of injury.
2. Monthly wages of the employee.
3. Relevant factor as specified in Schedule IV.
a. Death: The amount of compensation payable for death will be as follows, namely :-
- Where death results an amount equal to fifty percent of the monthly wages of the deceased
workman multiplied by the relevant factor; or an amount of one lakh twenty thousand
rupees, whichever is more.
- 50 X Monthly Wages X Relevant Factor
100
- The above or 1,20,000.00 whichever is more.
- In addition funeral expenses Rs. 2,500 are payable.
b. Permanent total disability: The amount of compensation payable for Permanent total
disability will be as follows, namely:
- Where Permanent total disability results an amount equal to 60 percent of the monthly
wages of the workman multiplied by the relevant factor; or an amount of one lakh forty
thousand rupees, whichever is more.
- 60 X Monthly Wages X Relevant Factor
100
- “relevant factor” in relation to a workman means the factor specified in the second column of
Schedule IV against the entry in the first column of that Schedule specifying the number of
years which are the same as the completed years of the age of the workman on his last
birthday immediately preceding the date on which the compensation fell due. Where the
monthly wages of a workman exceed two thousand rupees, his monthly wages for the
purposes of clause (a) and clause (b) shall be deemed to be two thousand rupees only.
c. Permanent partial disability: The amount of compensation payable for Permanent partial
disability will be as follows, namely:
- In case of any injury specified in Part II of Schedule I: the percentage of compensation
payable is proportionate to the loss of earning capacity permanently caused by the scheduled
injury.
- The loss of capacity in such case shall be assessed by the qualified medical practitioner.
- Where Permanent partial disability results an amount equal to 60 percent of the monthly
wages of the workman multiplied by the relevant factor; or an amount of one lakh forty
thousand rupees, whichever is more.
- 60% of 60 X Monthly Wages X Relevant Factor
100
d. Temporary disability: The amount of compensation payable for Temporary disability will
be as follows, namely:
- Compensation payable is 25% of monthly wages, payable on half monthly basis.
- No compensation, if disablement is up to 3 days.
- Schedule IV lays down the relevant factor related to the age of the employee at the time of
death, injury and accident by which wages are multiplied to arrive at compensation.
- Cases: Sadashiv Krihna Adke v/s M/s Time Trapers 1991: the appellant was coolie engaged
in loading and unloading of the employers goods. Bunch of glass sheets fell and left foot
multiple injuries. Court held that it was accident arising out of and in the course of employment.
The loss was 60% later appeal said 100%.
- The compensation should be paid when due and penalty for default at interest 12% per annum
and if no justification for delay then pay a further 50% of such amount as penalty.
-
18. EXPLAIN DISTRIBUTION OF COMPENSATION, NOTICE AND CLAIMS OF
ACCIDENT.
DISTRIBUTION OF COMPENSATION
1. No payment of compensation in respect of a workman whose injury has resulted in death, and
no payment of a lump sum as 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.
2. In the case of a deceased workman, an employer may make to any dependent advances on
account of compensation not exceeding an aggregate of one hundred rupees, and so much of
such aggregate as does not exceed the compensation payable to that dependent shall be deducted
by the Commissioner from such compensation and repaid to the employer. The following
deduction can be made by the commissioner for any sum payable as compensation to the
workman:
- Actual cost of the funeral expenses not exceeding Rs. 50.
- Advance made to dependents of the workman on account of compensation not exceeding Rs.
100. The receipt of the commissioner shall be sufficient discharge in respect of compensation
deposited by him.
3. Compensation deposited in respect of a deceased workman shall, subject to any deduction made
under sub-section (4), be apportioned among the dependents 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 dependent.
4. 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 other cases, pay the money to the person entitled
thereto.
5. 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 his own motion or on an application made to him in this behalf, order
that the payment be made during the disability to any dependent of the workman or to any other
person, whom the Commissioner thinks best fitted to provide for the welfare of the workman.]
6. 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 on account of the variation of
the circumstances of any dependent 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 dependent 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 he 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 dependent of any sum already paid to him.
7. Where the Commissioner varies any order under sub-section (8) by reason of the fact that
payment of compensation to any person has been obtained by fraud, impersonation or other
improper means, any amount so paid to or on behalf of such person may be recovered in the
manner hereinafter provided in section 31.
8. 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 CLAIMS OF THE ACCIDENT

NOTICE
- Section 10 lays down about notice and claim in case of accident.
- The first thing a workman who is injured by accident must do, is to give in writing a notice of
the accident.
- It has to be sent as soon as practicable after the occurrence of the accident. It depends on the
circumstances of each case.
- 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.
- Therefore, the notice must contain the following:
a. The name and address of the workman injured.
b. The date of accident
c. The cause of the injury.
- The notice has to be served upon the employer or any one of the several employers or upon the
person who is responsible to the employer for the management of the branch of trade or
business where the injured was employed. It can be delivered to the person in hand or sent by
registered post addressed to the residence or any office or place of business of the person to
whom it is addressed.
- The state government has been instructed to maintain a notice book. An entry in the book is
considered to be sufficient notice of the accident to the employer.
CLAIMS
- 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 of
the accident or death.
- A claim for compensation must be made within two years of the occurrence of the accident or,
in case of death, within two years from the date of death.
- Where the accident is the contracting of a 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.
- In case of partial disablement due to the contracting of any such disease and which does not
force the workman to absent himself from work, the period of two years shall be counted from
the day the workman gives notice of the disablement to his employer.
- 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.
- The want of or any defect or irregularity in a notice shall not be a bar to the entertainment of a
claim –
(a) if the claim is preferred in respect of the death of a workman resulting from an accident
which occurred on the premises of the employer, or at any place where the control of the
employer or of any person employed by him, and the workman died on such premises or at
such place, or on any premises belonging to the employer, or died without having left the
vicinity of the premises or place where the accident occurred, or
(b) if the employer or any one of several employers or any person responsible to the employer
for the management of any branch of the trade or business in which the injured workman
was employed had knowledge of the accident from any other source at or about the time
when it occurred: Provided further, that the Commissioner may entertain and decide any
claim to compensation in any case notwithstanding that the notice has not been given, or
the claim has not been preferred, in due time as provided in this sub-section, if he is
satisfied that the failure so to give the notice or prefer the claim, as the case may be, was
due to sufficient cause.
FATAL ACCIDENTS
- Where a Commissioner receives information from any source that a workman has died as a
result of an accident arising out of and in the course of his employment, he may send by
registered post a notice to the workman's employer requiring him to submit, within thirty days
of the service of the notice, a statement, in the prescribed form, giving the circumstances
attending the death of the workman, and indicating whether, in the opinion of the employer, he
is or is not liable to deposit compensation on account of the death.
- If the employer is of opinion that he is liable to deposit compensation, he shall make the deposit
within thirty days of the service of the notice.
- If the employer is of opinion that he is not liable to deposit compensation, he shall in his
statement indicate the grounds on which he disclaims liability.
- Where the employer has so disclaimed liability, the Commissioner, after such enquiry as he may
think fit, may inform any of the dependents of the deceased workman, that it is open to the
dependents to prefer a claim for compensation, and may give them such other further
information as he may think fit.
- Section 10B. Reports of fatal accidents and serious bodily injuries.
1. Where, by any law for the time being in force, notice is required to be given to any
authority, by or on behalf of an employer, of any accident occurring on his premises which
results in death or serious bodily injury, the person required to give the notice shall, within
seven days of the death or serious bodily injury, send a report to the Commissioner giving
the circumstances attending the death or serious bodily injury: Provided that where the State
Government has so prescribed the person required to give the notice may instead of sending
such report to the Commissioner send it to the authority to whom he is required to give the
notice. Explanation - “Serious bodily injury” means an injury which involves, or in all
probability will involve the permanent loss of the use of, or permanent injury to, any limb, or
the permanent loss of or injury to the sight or hearing, or the fracture of any limb, or the
enforced absence of the injured person from work for a period exceeding twenty days.
2. The State Government may, by notification in the Official Gazette, extend the provisions of
sub-section (1) to any class of premises other than those coming within the scope of that sub-
section, and may, by such notification, specify the persons who shall send the report to the
Commissioner. Nothing in this section shall apply to factories to which the Employees' State
Insurance Act, 1948, (34 of 1948.) applies.
19. DISCUSS THE APPOINTMENT OF COMMISSIONERS AND THEIR POWER AND

PROCEDURE
REFERENCE TO COMMISSIONERS
- 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 question as to the nature or extent
of disablement), the question shall, in default of agreement, be settled by a Commissioner.
- No Civil Court shall have jurisdiction to settle, decide or deal with any question which is by or
under this Act required to be settled, decided or dealt with by a Commissioner or to enforce any
liability incurred under this Act.
APPOINTMENT OF COMMISSIONERS.
- The State Government may, by notification in the Official Gazette, appoint any person to be a
Commissioner for Workmen's Compensation for such 2*** area as may be specified in the
notification.
- Where more than one Commissioner has been appointed for any 2*** area, the State
Government may, by general or special order, regulate the distribution of business between
them.]
- 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.
- Every Commissioner shall be deemed to be a public servant within the meaning of the Indian
Penal Code (45 of 1860)
VENUE OF PROCEDINGS AND TRANSFER.

- Where any matter is under this Act to be done by or before a Commissioner, the same shall,
subject to the provisions of this Act and to any rules made hereunder, be done by or before a
Commissioner for the area in which the accident took place which resulted in the injury:
Provided that, where the workman is the master of a ship or a seaman, any such matter may be
done by or before a Commissioner for the area in which the owner or agent of the ship resides
or carries on business.
- 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 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:
Provided that the Commissioner shall not, where any party to the proceedings has appeared
before him, make any order of transfer relating to the distribution among dependents of a lump
sum without giving such party an opportunity of being heard: Provided further that no matter
other than a matter relating to the actual payment to a workman or the distribution among
dependants of a lump sum shall be transferred for disposal under this sub-section to a
Commissioner in the same State save with the previous sanction of the State Government or to a
Commissioner in another State save with the previous sanction of the State Government of that
State], unless all the parties to the proceedings agree to the transfer.
- The commissioner to whom any matter is so transferred shall, subject to rules made under this
Act, inquire thereinto 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.
- 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 with such report.
- The State Government may transfer any matter from any Commissioner appointed by it to any
other commissioner appointed by it.
FORM OF APPLICATION.
- No application for the settlement of any matter by a Commissioner, other than an application by
a dependent or dependents for compensation shall be made unless and until some question has
arisen between the parties in connection therewith which they have been unable to settle by
agreement.
- 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 addresses of the parties; and
d) except in the case of an application by dependents for compensation] a concise statement of
the matters on which agreement has and 3*[of] those on which agreement has not been come
to.
- If the applicant is illiterate or for any other reason is unable to furnish the required information
in writing, the application shall, if the applicant so desires, be prepared under the direction of
the Commissioner.
POWER OF COMMISSIONER TO REQUIRE FURTHER DEPOSIT IN CASES OF

FATAL ACCIDENT.
- Where any sum has been deposited by an employer as compensation payable in respect of a
workman whose injury has resulted in death, and in the opinion of the Commissioner such sum
is insufficient, the Commissioner may, by notice in writing stating his reasons, call upon the
employer to show cause why he should not make a further deposit within such time as may be
stated in the notice.
- If the employer fails to show cause to the satisfaction of the Commissioner, the Commissioner
may make an award determining the total amount payable, and requiring the employer to
deposit the deficiency.
POWERS AND PROCEDURE OF COMMISSIONERS.

- The Commissioner shall have all the powers of a Civil Court under the Code of Civil Procedure,
1908 (5 of 1908),
a. for the purpose of taking evidence on oath (which such Commissioner is hereby empowered
to impose) and
b. of enforcing the attendance of witnesses and
c. compelling the production of documents and material objects, and the Commissioner shall be
deemed to be a Civil Court for all the purposes of section 195 and of Chapter XXXV of the
Code of Criminal Procedure, 1898 (5 of 1898)].
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 by any other officer
specified by the State Government in this behalf, authorized in writing by such person, or, with
the permission of the Commissioner, by any other person so authorised.
Method of recording evidence.
- The Commissioner shall make a brief memorandum of the substance of the evidence of every
witness as the examination of the witness proceeds, and such memorandum shall be written and
signed by the Commissioner with his own hand and shall form part of the record: Provided that,
if the Commissioner is prevented from making such memorandum, he shall record the reason of
his inability to do so and shall cause such memorandum to be made in writing from his dictation
and shall sign the same, and such memorandum shall form part of the record: Provided further
that the evidence of any medical witness shall be taken down as nearly as may be word for
word.
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 decision of the High
Court and, if he does so, shall decide the question in conformity with such decision.
UNIT 5
20. SALIENT FEATURES OF THE MATERNITY BENEFIT ACT, 1961

- Motherhood is a very special experience in a woman’s life. A woman needs to be able to give
quality time to her child without having to worry about whether she will lose her job and her
source of income. That is where the concept of maternity leave and the benefits it entails, comes
in handy.
- The Maternity Benefits Act, 1961, gives her the assurance that her rights will be looked after
while she is at home to care for her child.
- Article 42 of the Constitution of India of India states that the State shall make provision for
securing just and humane conditions of work and for maternity relief.
- As per Article 39 the Government of India shall direct its policy towards securing the health of
women. Therefore the Maternity Benefit Act, is to regulate the employment of women in certain
establishments for certain periods before and after childbirth and to provide for maternity
benefits and certain other benefits.
- The salient Features of the Act are:
a. Applicability and extent:
- The Maternity Benefit Act applies:
1. to women who work in factories, mines, plantations, including any establishment
belonging to the Government and to every establishment wherein persons are
employed for the exhibition of equestrian, acrobatic and other performances.
2. To every shops and establishment with 10 or more employees are employed or
employed on any day of the preceding 12 months.
- It does not apply to employees covered by the Employees State Insurance Act, 1948.
- It can be extended to other establishments by the State Governments to any other
establishments or class of establishments, industrial, commercial, agricultural or
otherwise.
- The Act extends to the whole of India.
b. Definitions:
- Child includes a still-born child (Sec.3(b)).
- Delivery means the birth of a child (Sec.3(c))
- Commissioning Mother means a biological mother who uses her egg to create an
embryo implanted in any other woman.
- Employer means:
1. in relation to an establishment which is under the control of the Government, a person
or authority appointed by the Government for the supervision and control of
employees or where no person or authority is so appointed, the head of the
department;
2. in relation to an establishment under any local authority, the person appointed by such
authority or the supervision and control of employees or where no person is so
appointed, the chief executive officer of the local authority;
3. 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 (Sec.3(d)).
- Establishment means—
1. a factory;
2. a mine;
3. a plantation;
4. an establishment wherein persons are employed for the exhibition of equestrian,
acrobatic and other performances;
5. a shop or establishment; or
6. an establishment to which the provisions of this Act have been declared under sub-
section (1) of section 2 to be applicable (Sec.3(e)).
- Miscarriage means the 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
cause of which is punishable under the Indian Penal Code, 1860 (Sec.3(j)).
- Wages means remuneration paid or payable in cash to a woman and includes:
1. Cash allowances such as Dearness and house rent allowance,
2. incentive bonus and
3. the money value of the concessional supply of food grains and other articles.
It does include:
1. any other kind of bonus,
2. overtime earnings,
3. any contribution towards the pension fund or provident fund and
4. any gratuity payable on the termination of service (Sec.3(n)).
c. Employment of women prohibited during certain periods:

- Employer shall not knowingly employ a woman in any establishment during the six
weeks immediately following the day of her delivery or her miscarriage, or medical
termination of her pregnancy.
- No woman shall work in any establishment during the six weeks immediately following
the day of her delivery of her miscarriage, or medical termination of her pregnancy.
- If pregnant woman makes a request to her employer, she shall not be given any work
which is of the following nature during 1 month before the aforesaid 6 weeks period.
1. of an arduous nature or
2. which involves long hours of standing or
3. 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.
d. Right to payment of maternity benefit/ persons entitled to maternity benefit:

- Every woman is entitled to the payment of maternity benefit at the rate of the average
daily wage for the period of her actual absence immediately preceding and including the
day of her delivery and for the six weeks immediately following that day.
- The average daily wage is calculated on the basis of the amount payable to her for the
days on which she has worked during the period of three calendar months immediately
preceding the date from which she has absented herself on account of maternity, or one
rupee a day, whichever is higher.
Eligibility
- To be eligible for maternity benefit, a woman should have worked in an establishment for
not less than 80 days in the twelve months immediately prior to the date of her expected
delivery.
- For the purpose of calculating under this sub- section the days on which a woman has
actually worked in the establishment, the days for which she has been laid off or was on
holidays declared under any law for the time being in force to be holidays with wages]
during the period of twelve months immediately preceding the date of her expected
delivery shall be taken into account.
Period of benefit
- The maximum period for which any woman can be entitled to maternity benefit is 26
weeks. This includes 8 weeks up to and including the day of her expected delivery.the
maximum period entitled to maternity benefit by a woman having 2 or more surviving
children shall be 12 weeks of which not more than 6 weeks shall precede the date of her
expected delivery.
Benefit in case of death of woman
- If a woman dies during this period, the maternity benefit will be payable only for the days
up to and including the day of her death.
- However, if she delivers a child and dies during the delivery or during the period of six
weeks following the delivery, the employer will be liable for the maternity benefits of that
entire period. If the child dies during this period, the liability will be only upto and
including the day of the death of the child.
- In case the woman dies before receiving the benefit, the amount must be paid to her
nominee or legal representative.
Maternity benefit for woman adopting the child
- A woman who legally adopts a child below the age of 3 months or a commissioning
mother shall be entitled to maternity benefit for a period of 12 weeks from the date the
child is handed over to the adopting mother or the commissioning mother, as the case
may be.
e. Continuance of payment of maternity benefit:

- Maternity benefit shall be paid to a woman worker until she becomes qualified to claim to
claim maternity benefit under the Employees State Insurance Act, 1948.
- The logic behind is that the woman is not deprived of the maternity benefit and the same
time employer is not obliged to pay a double benefit.
f. Payment of maternity benefit in certain cases:
- Every woman:
1. who is employed in a factory or other establishment to which the provisions of the
Employees' State Insurance Act, 1948 (34 of 1948), apply;
2. whose wages (excluding remuneration for overtime work) for a month exceed the
amount specified in Employees' State Insurance Act, 1948 (34 of 1948), and
3. who has worked 80 days in preceding 12 months of the expected date of delivery shall
be entitled to the payment of maternity benefit under this Act.
g. 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, 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.
h. Payment of medical bonus:

- Every woman entitled to maternity benefit under this Act shall also be entitled to receive
from her employer a medical bonus of no notified amount, if no pre-natal confinement
and post-natal care is provided for by the employer free of charge.
- Notified Limit is 2,500 to 3,500 vide notification No. SO 2831(E) dated 19.12.2011.
i. Leave for miscarriage:

- In case of miscarriage, 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 six weeks
immediately following the day of her miscarriage.
j. Leave for illness arising out of pregnancy, delivery, premature birthof child, or
miscarriage:
- Women who are ill on account of pregnancy, delivery, premature birth of a child or a
miscarriage are also entitled in additioin to the period of absence allowed to her u/s 6 or
as the case may be u/s 9, or to leave with wages at the rate of maternity benefit for a
maximum period of one month. However, they must submit proof of their illness.
k. 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.
l. Notice of claim for maternity benefit and payment thereof:

- Section 6 provides that any woman employed in an establishment and entitled to
maternity benefit under the provisions of the 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 the may nominate in the notice and that she will not work in any establishment during
the period for which she receives maternity benefit.
- In the case of a woman who is pregnant such notice shall state the date from which she
will be absent from work. Any woman who has not given the notice when she was
pregnant may give such notice as soon as possible after delivery.
- On receipt of the notice, the employer shall permit such woman to absent herself during
the period for which she receives her maternity benefit.
- After receiving the notice the employer shall pay in advance the amount of materinity
benefit for treh period preceding the date of her expected deliver.
- 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.
m. Dismissal during absence of pregnancy:

- The employer is prohibited to discharge or dismiss the woman during or on account of
such absence from work during the pregnancy.
- When a woman absents herself from work, it shall be unlawful for her employer to
discharge or dismiss the woman during or on account of such absence or to give notice of
discharge or dismissal on such a date that the notice will expire during such absence, or to
vary to her disadvantage any of the conditions of her service.
- If the dismissal is 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.
- 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 60 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.
n. No deduction in wages in certain cases:

- No deduction from the normal and usual daily wages of a woman entitled to maternity
benefit under the provisions of this Act shall be made by reason only of
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.
o. Forfeiture of maternity benefits:

- 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.
p. Inspectors, appointment, powers and duties
- 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 women 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: Provided that no person
shall be compelled under this section to answer any question or give any evidence
tending to incriminate himself;
c. require the employer to give information regarding the names and addresses of women
employed, payments made to them, and applications or notices received from them
under this Act; and
d. 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 on 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;
b. she has been discharged or dismissed during or on account of her absence from
work in accordance with the provisions of this Act, may pass such orders 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.
q. Penalty for contravention of Act by employer:

- 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 on account of her absence from
work in accordance with the provisions of this Act, he shall be punishable with
imprisonment which shall not be less than 3 months but which may extend to one year
and with fine which shall not be less than 2000 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.
- If any employer contravenes the provisions of this Act or the rules made thereunder, he
shall, if no other penalty is elsewhere provided by or under this Act for such
contravention, be punishable with imprisonment which may extend to one year, or with
fine which may extend to five thousand rupees, or with both: Provided that where the
contravention is of any provision regarding maternity benefit or regarding payment of any
other amount and such maternity benefit or amount has not already been recovered, the
court shall, in addition, recover such maternity benefit or amount as if it were a fine and
pay the same to the person entitled thereto.
- Penalty for obstructing Inspector. Whoever fails to produce on demand by the
Inspector any register or document in his custody kept in pursuance of this Act or the
rules made thereunder or conceals or prevents any person from appearing before or being
examined by an Inspector shall be punishable with imprisonment which may extend to
one year, or with fine which may extend to five thousand rupees], or with both. 23.
Cognizance of offences.
- 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, 1860 (21 of 1860) or an
Inspector, may file a complaint regarding the commission of an offence under this
Act in any court of competent jurisdiction and no such complaint shall be filed 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 of the first
class shall try any offence under this Act.
21. WHO IS AN APPRENTICE UNDER THE APPRENTICE ACT, 1961? WHAT ARE THE
QUALIFICATIONS FOR BEING ENGAGED AS AN APPRENTICE TRAINING?
APPRENTICE ACT – OBJECT, SCOPE AND EXTENSION
- The word apprentice is derived from the French word ‘apprendre’ which means to learn. He is
therefore a learner.
- Training of a young person is both social and economic necessity.
- But the employer may take undue advantage of the apprentice therefor the Act is made to
regulate and control the programme of training of apprentices and for all matter connected
therewith.
- The Act came into force on 1st March, 1962.
- Object: The main purpose of the Act is to provide practical training to technically qualified
persons in various trades. It was enacted with the object to regulate the programme of training
of apprentice in the industry so as to conform to the prescribed training standards as laid down
by the Central Apprenticeship Council and to utilize fully the facilities available in industry for
imparting practical training with a view to meeting the requirements of skilled manpower for
industry. The objective is promotion of new skilled manpower. The scheme is also extended to
engineers and diploma holders.
- The Act applies to areas and industries as notified by Central government. [Section 1(4)].
- It extends to the whole of India.
WHO IS AN APPRENTICE?
- Apprentice means a person who is undergoing apprenticeship training in pursuance of a contract
of apprenticeship.
QUALIFICATIONS FOR AN APPRENTICE?
- A person shall be qualified for being engaged as an apprentice to undergo apprenticeship
training in any designated trade, if such person
a. is not less than fourteen years of age, and
b. satisfies such standards of education and physical fitness as may be prescribed: Provided that
different standards may be prescribed in relation to apprenticeship training in different
designated trades and for different categories of apprentices.
2. Reservation of training places for the Scheduled Castes and the Scheduled Tribes in designated
trades:
a. in every designated trade, training places shall be reserved by the employer for the
Scheduled Castes and the Scheduled Tribes and where there is more than one designated
trade in an establishment, such training places shall be reserved also on the basis of the total
number of apprentices in all the designated trades in such establishment.
b. the number of training places to be reserved for the Scheduled Castes and the Scheduled
Tribes under sub-section (1) shall be such as may be prescribed, having regard to the
population of the Scheduled Castes and the Scheduled Tribes in the State concerned.
Explanation - In this section, the expressions “Scheduled Castes” and “Scheduled Tribes” shall
have the meanings as in clauses (24) and (25) of Article 366 of the Constitution].
22. DISCUSS CONTRACT, NOVATION, PERIOD AND TERMINATION OF APPRENTICE

CONTRACT OF APPRENTICE
- A person shall not be engaged as an apprentice to undergo apprenticeship training in a
designated trade unless:
a. Such person or if he is a minor, his guardian has entered into a contract of apprenticeship
with the employer.
b. The contract of apprenticeship has been registered with the apprenticeship adviser.
c. Every contract of apprenticeship may contain such terms and conditions as may be agreed to
by the parties to the contract. However, no such term or condition shall be inconsistent with
any provision of this Act or any rule made thereunder.
d. Every contract of apprenticeship shall be sent by the employer within such 30 days to the to
the Apprenticeship Adviser until a portal-site is developed by the Central Government, and
thereafter the details of contract of apprenticeship shall be entered on the portal-site within 7
days for verification and registration.
e. The Apprenticeship Adviser shall not register a contract of apprenticeship unless he is
satisfied that the person described as an apprentice in the contract is qualified under this Act
for being engaged as an apprentice to undergo apprenticeship training in the designated trade
specified in the contract.
f. Where the Central Government, after consulting the Central Apprenticeship Council, makes
any rule varying the terms and conditions of apprenticeship training of any category of
apprentices undergoing such training, then, the terms and conditions of every contract of
apprenticeship relating to that category of apprentices and subsisting immediately before the
making of such rule shall be deemed to have been modified accordingly.
- A minor can enter into a legal binding contract of apprenticeship if he satisfies the conditions
laid down in the Act:
a. He has attained the age of fourteen years.
b. He satisfies the prescribed standards of education and physical fitness.
c. His guardian last entered into a contract of apprenticeship with the employer.
NOVATION OF CONTRACT OF APPRENTICE
- Where an employer with whom a contract of apprenticeship has been entered into, is for any
reason unable to fulfil his obligations under the contract and with the approval of the
Apprenticeship Adviser it is agreed between the employer, the apprentice or his guardian and
any other employer that the apprentice shall be engaged as apprentice under the other employer
for the un-expired portion of the period of apprenticeship training, the agreement, on
registration with the Apprenticeship Adviser, shall be deemed to be the contract of
apprenticeship between the apprentice or his guardian and other employer, and on and from the
date of such registration, the contract of apprenticeship with the first employer shall terminate
and no obligation under the contract shall be enforceable at the instance of any party to the
contract against the other party thereto.
CONTRACT OF APPRENTICE
- The period of apprenticeship training, which shall be specified in the contract of apprenticeship,
shall be as follows
a. In the case of trade apprentices who, having undergone institutional training in a school or
other institution recognised by the National Council, have passed the trade tests or
examinations conducted by that Council or by an institution recognized by that Council, the
period of apprenticeship training shall be such as may be determined by that Council;
b. in case of trade apprentices who, having undergone institutional training in a school or other
institution affiliated to or recognised by a Board or State Council of Technical Education or
any other authority which the Central Government may, by notification in the official gazette
specify in this behalf, have passed the trade tests or examinations conducted by that Board or
State Council or authority, the period of apprenticeship training shall be such as may be
prescribed;
c. in the case of other trade apprentices, the period of apprenticeship training shall be such as
may be prescribed;
d. in the case of graduate or technician apprentices, technician (vocational) apprentices and the
period of apprenticeship training shall be such as may be prescribed.
TERMINATION OF APPRENTICESHIP CONTRACT -

1. The contract of apprenticeship shall terminate on the expiry of the period of apprenticeship
training.
2. Either party to a contract of apprenticeship may make an application to the Apprenticeship
Adviser for the termination of the contract, and when such application is made, shall send by
post a copy thereto to the other party to the contract.
3. After considering the contents of the application and the objections, if any, filed by the other
party, the Apprenticeship Adviser may, by order in writing, terminate the contract, if he is
satisfied that the parties to the contract or any of them have or has failed to carry out the terms
and conditions of the contract and it is desirable in the interests of the parties or any of them to
terminate the same:
4. Notwithstanding anything contained in any other provision of this Act, where a contract of
apprenticeship has been terminated by the Apprenticeship Adviser before the expiry of the
period of apprenticeship training and a new contract of apprenticeship is being entered into with
an employer, the Apprenticeship Adviser may, if he satisfied that the contract of apprenticeship
with the previous employer could not be completed because of any lapse on the part of the
previous employer, permit the period of apprenticeship training already undergone by the
apprentice with his previous employer to be included in the period of apprenticeship training to
be undertaken with the new employer.
Provided that where a contract is terminated-
(a) for failure on the part of the employer to carry out the terms and conditions of the contract,
the employer shall pay to the apprentice such compensation as may prescribed;
(b) for such failure on the part of the apprentice, the apprentice or his guardian shall refund to
the employer as cost of training such amount as may be determined by the Apprenticeship
Adviser.
23. DISCUSS OBLIGATIONS OF EMPLOYERS, OBLIGATIONS OF APPRENTICE UNDER

APPRENTICE ACT.
OBLIGATIONS OF EMPLOYERS
- Without prejudice to the other provisions of this Act, every employer shall have the following
obligations in relation to an apprentice, namely:
a. to provide the apprentice with the training in his trade in accordance with the provisions of
this Act, and the rules made thereunder;
b. if the employer is not himself qualified in the trade, to ensure that a person who possesses the
prescribed qualifications is placed in charge of the training of the apprentice;
c. to provide adequate instructional staff, possessing such qualifications as may be prescribed,
for imparting practical and theoretical training and facilities for trade test of apprentices; and
d. to carry out his obligations under the contract of apprenticeship.
Obligation of payment by employer

- The employer shall pay stipend at a specified rate to the apprentice for the period of
apprenticeship training as per contract of apprentice.
- It is to be noted that employers are not allowed to stipend to apprentice on the basis of piece
work basis.
- He cannot take part in any output or other incentive scheme.
- The Apprenticeship Rules, 1962 lays down the following minimum rates of stipend payable
to an apprentice:
a. To trade apprentices (rules 7-1)
During the first year of training = 290 pm
During the second year of training = 330 pm
During the third year of training = 380 pm
During the fourth year of training = 440 pm
b. To graduates or technical apprentices (rule 7-1A)
Engineering graduates = 700 pm
Sandwich course students (degree insti.) = 500 pm
Diploma holders = 500 pm
Sandwich course students (diploma insti)= 400 pm
Obligation to health, safety and welfare of apprentice

a. The weekly and daily hours of work of an apprentice while undergoing practical training in a
workshop shall be such as may be prescribed.
b. No apprentice shall be required or allowed to work overtime except with the approval of the
Apprenticeship Adviser who shall not grant such approval unless he is satisfied that such
overtime is in the interest of the training of the apprentice or in the public interest.
c. An apprentice shall be entitled to such leave as may be prescribed and to such holidays as are
observed in the establishment in which he is undergoing training.
Hours of work, overtime and leave
a. The weekly and daily hours of work of an apprentice while undergoing practical training in a
workshop shall be such as may be prescribed.
b. No apprentice shall be required or allowed to work overtime except with the approval of the
Apprenticeship Adviser who shall not grant such approval unless he is satisfied that such
overtime is in the interest of the training of the apprentice or in the public interest.
c. An apprentice shall be entitled to such leave as may be prescribed and to such holidays as are
observed in the establishment in which he is undergoing training.
Hours of work
- The weekly hours of work of an apprentice while undergoing practical training shall be as
follows:
1. The total number of hours per week shall be 42 to 48 hours (including the time spent on
Related Instructions)
2. Apprentice undergoing basic training shall ordinarily work for 42 hours per week.
3. Apprentices during the second year shall work for 42 to 45 hours per week including the
time spent on related instructions.
4. Apprenticed during the third year and subsequent years of apprenticeship shall work for
the same number of hours per week as the workers in the trade in the establishment in
which the apprenticeship is undergoing apprenticeship training.
5. No apprentice other than short time apprentice shall be engaged on such training between
the hours of 10 pm and 6 am.
OBLIGATIONS OF APPRENTICES-
- Every trade apprentice undergoing apprenticeship training shall have the following obligations,
namely:
a. to learn his trade conscientiously and diligently and endeavour to qualify himself as a skilled
craftsman before the expiry of the period of training;
b. to attend practical and instructional classes regularly;
c. to carry out all lawful orders of his employer and superiors in the establishments; and
d. to carry out his obligations under the contract of apprenticeship.
- Every graduate or technician apprentice technician (vocational) apprentice undergoing
apprenticeship training shall have the following obligations namely:
a. to learn his subject field in engineering or technology or vocational course conscientiously
and diligently at his place of training;
b. to attend the practical and instructional classes regularly;
c. to carry out all lawful orders of his employers and superiors in the establishment;
d. to carry out his obligations under the contract of apprenticeship which shall include the
maintenance of such records of his work as may be prescribed.
24. DISCUSS PRACTICAL AND BASIC TRAINING AND RELATED INSTRUCTIONS OF

APPRENTICES UNDER APPRENTICE ACT.
PRACTICAL AND BASIC TRAINING OF APPRENTICES-
1. Every employer shall make suitable arrangements in his workshop for imparting a course of
practical training to every apprentice engaged by him in accordance with the programme
approved by the Apprenticeship Adviser.
2. The Central Apprenticeship Adviser or any other person not below the rank of an Assistant
Apprenticeship Adviser authorised by the State Apprenticeship Adviser in writing in this behalf]
shall be given all reasonable facilities for access to each such apprentice with a view to test his
work and to ensure that the practical training is being imparted in accordance with the approved
programme: Provided that the State Apprenticeship Adviser or any other person not below the
rank of an Apprenticeship Adviser authorised by the State Apprenticeship Adviser in writing in
this behalf] shall also be given such facilities in respect of apprentices undergoing training in
establishments in relation to which the appropriate Government is the State Government.
3. Such of the trade apprentices as have not undergone institutional training in a school or other
institution recognized by the National Council or any other institution affiliated to or recognized
by a Board or State Council of Technical Education or any other authority which the Central
Government may, by notification in the Official Gazette, specify in this behalf, shall, before
admission in the workshop for practical training, undergo a course of basic training.
4. Where an employer employs in his establishment five hundred or more workers, the basic
training shall be imparted to the trade apprentices either in separate parts of the workshop
building or in a separate building which shall be set up by the employer himself, but the
appropriate Government may grant loans to the employer on easy terms and repayable by easy
installments to meet the cost of the land, construction and equipment for such separate building.
5. If the number of apprentices to be trained at any time in any establishment in which five
hundred or more workers are employed, is less than twelve the employer in relation to such
establishment may depute all or any of such apprentices to any Basic Training Centre or
Industrial Training Institute for basic training in any designated trade, in either case, run by the
Government.
6. Where an employer deputes any apprentice under sub-section (4-A), such employer shall pay to
the Government the expenses incurred by the Government on such training, at such rate as may
be specified by the Central Government.
7. Where an employer employs in his establishment less than five hundred workers, the basic
training shall be imparted to the trade apprentices in training institutes set by the Government.
8. In any such training institute, which shall be located within the premises of the most suitable
establishment in the locality or at any other convenient place the trade apprentices engaged by
two or more employers may be imparted basic training.
9. In case of an apprentice other than a graduate or technician apprentice, technician (vocational)
apprentice the syllabus of, and the equipment to be utilized for, practical training including basic
training shall be such as may be approved by the Central Government in consultation with the
Central Apprenticeship Council.
10. In case of graduate or technician apprentices technician (vocational) apprentices the programme
of apprenticeship training and the facilities required for such training in any subject field in
engineering or technology or vocational course shall be such as may be approved by the Central
Government in consultation with the Central Apprenticeship Council.
11. Recurring costs (including the cost of stipends) incurred by an employer in connection with
basic training, imparted to trade apprentices other than those referred to in clauses (a) and (aa)
of Section 6 shall be borne:
(i) If such employer employs two hundred and fifty workers or more, by the employer;
(ii) If such employer employs less than two hundred and fifty workers, by the employer and the
Government in equal shares up to such limit as may be laid down by the Central
Government and beyond that limit, by the employer alone; and
Recurring costs (including the cost of stipends), if any, incurred by an employer in connection
with practical training, including basic training, imparted to trade apprentices referred to in
clauses (a) and (aa) of Section 6 shall, in every case, be borne by the employer.
Recurring costs (excluding the cost of stipends) incurred by an employer in connection with the
practical training imparted to graduate or technician apprentices technician (vocational)
apprentices shall be borne by the employer and the cost of stipends shall be borne by the Central
Government and the employer in equal shares up to such limit as may be laid down by the
Central Government and beyond that limit, by the employer alone.
RELATED INSTRUCTION OF APPRENTICES-

1. A trade apprentice who is undergoing practical training in an establishment shall, during the
period of practical training, be given a course of related instruction (which shall be appropriate
to the trade) approved by the Central Government in consultation with the Central
Apprenticeship Council, with a view to giving the trade apprentice such theoretical knowledge
as he needs in order to become fully qualified as a skilled craftsman.
2. Related instruction shall be imparted at the cost of the appropriate Government but the employer
shall, when so required, afford all facilities for imparting such instruction.
3. Any time spend by a trade apprentice in attending classes on related instruction shall be treated
as part of his paid period of work.
4. In case of trade apprentices who, after having undergone a course of institutional training, have
passed the trade tests conducted by the National Council or have passed the trade tests and
examinations conducted by a Board or State Council of Technical Education or any other
authority which the Central Government may, by notification in the Official Gazette, specify in
this behalf, the related instruction may be given on such reduced or modified scale as may be
prescribed.
5. Where any person has, during his course in technical institution, become a graduate or
technician apprentice, technician (vocational) apprentice and during his apprenticeship training
he has to receive related instruction, then, the employer shall release such person from practical
training to receive the related instruction in such institution, for such period as may be specified
by the Central Apprenticeship Adviser or by any other person not below the rank of an Assistant
Apprenticeship Adviser authorised by the Central Apprenticeship Adviser in writing in this
behalf.
25. DISCUSS AUTHORITIES AND PENALTIES UNDER APPRENTICE ACT.

- In addition to the Government, there shall be the following authorities under this Act, namely:-
1. The National Council,
2. The Central Apprenticeship Council,
3. The State Council,
4. The State Apprenticeship Council,
5. The All India Council,
6. The Regional Boards,
7. The Boards or State Council of Technical Education,
8. The Central Apprenticeship Adviser, and
9. The State Apprenticeship Adviser.
- Every State Council shall be affiliated to the National Council and every State Apprenticeship
Council shall be affiliated to the Central Apprenticeship Council.
- Every Board or State Council of Technical Education and every Regional Board shall be
affiliated to the Central Apprenticeship Council.
- Each of the authorities specified in subsection (1) shall, in relation to apprenticeship training
under this Act, perform such functions as are assigned to it by or under this Act or by the
Government: Provided that a State Council shall also perform such functions as are assigned to
it by the National Council and the State Apprenticeship Council and the Board or State Council
or Technical Education shall also perform such functions as are assigned to it by the Central
Apprenticeship Council.
Constitution of Councils
The Central Government shall, by Notification in the Official Gazette, establish the Central
Apprenticeship Council and the State Government shall, by notification in the Official Gazette,
establish the State Apprenticeship Council.
Central Apprenticeship Council

- The Central Apprenticeship Council shall consist of a Chairman and a Vice Chairman and such
number of other members as the Central Government may think expedient, to be appointed by
that Government by notification in the Official Gazette, from among the following categories of
persons, namely-
(a) Representatives of employees in establishment in the public and private sectors,
(b) representatives of the Central Government and of the State Government,
(c) persons having special knowledge and experience on matters relating to industry, labour
and technical education, and
(d) Representatives of the All India Council and of the Regional Boards.
- The number of persons to be appointed as members of the Central Apprenticeship Council from
each of the categories mentioned above, the term, of office of, the procedure to be followed in
the discharge of their functions by, and the manner of filling vacancies among, the members of
the Council shall be such as may be prescribed.
- The fees and allowances, if any, to be paid to the Chairman and the Vice Chairman and the
other members of the Central Apprenticeship Council, shall be such as may be determined by
the Central Government.
State Apprenticeship Council

- The State Apprenticeship Council shall consist of a Chairman and a Vice Chairman and such
number of other members as the State Government may think expedient, to be appointed by that
Government by notification in the Official Gazette from among the following categories or
persons, namely:
(a) representatives of employers in establishments in the public and private sectors,
(b) representatives of the Central Government and of the State Governments
(c) persons having special knowledge and experience on matters relating to industry, labour
and technical education, and
(d) Representatives of the Board or of the State Council of Technical Education...
- The number of persons to be appointed as members of the State Apprenticeship Council from
each of the categories specified in sub-section (4), the term of office of, the procedure to be
followed in the discharge of their functions by, and the manner of filling vacancies among, the
members of the Council shall be such as the State Government may, by notification in the
Official Gazette, determine.
- The fees and allowances, if any, to be paid to the Chairman and the Vice-Chairman and the
other members of the State Apprenticeship Council shall be such as may be determined by the
State Government.
Vacancies not to invalidate acts and proceedings

No act done or proceeding taken by the National Council, the Central Apprenticeship Council, the
State Council or the State Apprenticeship Council under this Act shall be questioned on the ground
merely of the existence of any vacancy in, or defect in the constitution of, such Council.
Apprenticeship Advisers
1. The Central Government shall, by notification in the Official Gazette, appoint a suitable person
as the Central Apprenticeship Adviser.
2. The State Government shall, by notification in the Official Gazette, appoint a suitable person as
the State Apprenticeship Adviser.
3. The Central Apprenticeship Adviser shall be the Secretary to the Central Apprenticeship
Council and the State Apprenticeship Adviser shall be the Secretary to the State Apprenticeship
Council.
Deputy and Assistant Apprenticeship Advisers

1. The Government may appoint suitable persons as Additional, Joint, Regional, Deputy and
Assistant Apprenticeship Advisers to assist the Apprenticeship Adviser in the performance of
his functions.
2. Every Additional, Joint, Regional, Deputy or Assistant Apprenticeship Advisers to assist the
Apprenticeship Advisor, perform such functions as may be assigned to him by the
Apprenticeship Adviser.
Apprenticeship Advisers to be public servants

Every Apprenticeship Adviser and every Additional, Joint, Regional, Deputy or Assistant
Apprenticeship Adviser] appointed under this Act, shall be deemed to be a public servant within
the meaning of Section 21 of the India Penal Code (45 of 1860).
Powers of entry, Inspection, etc.

1. Subject to any rule made in this behalf the 102[Central Apprenticeship Adviser, or such other
person, not below the rank of an Assistant Apprenticeship Adviser, as may be authorised by the
Central Apprenticeship Adviser in writing in this behalf] may-
a. with such assistants, as he thinks fit, enter, inspect and examine any establishment or part
thereof at any reasonable time;
b. examine any apprentice employed therein or require the production of any register, record or
other documents maintained in pursuance of this Act and take on the spot or otherwise
statements of any persons which he may consider necessary for carrying out the purposes of
this Act;
c. make such examination and inquiry as he thinks fit in order to ascertain whether the
provisions of this Act and the rules made thereunder are being observed in the establishment;
d. exercise such other powers as may be prescribed:
Provided that a State Apprenticeship Adviser or such other person, not below the rank of an
Assistant Apprenticeship Adviser, as may be authorized by the State Apprenticeship Adviser in
writing in this behalf] may also exercise any of the powers specified in clause (a), (b), (c) or (d)
of this sub-section in relation to establishments for which the appropriate Government is the
State Government.
2. Notwithstanding anything in sub-section (1), no person shall be compelled under this section to
answer any question or make any statement which may tend directly or indirectly to incriminate
him.
Offences and penalties

1. If any employer
a. engages as an apprentice a person who is not qualified for being so engaged, or
b. fails to carry out the terms and conditions of a contract of apprenticeship or
c. contravenes the provisions of this Act relating to the number of apprentices which he is
required to engage under those provisions, he shall be punishable with imprisonment for a
term which may extend to six months or with fine or with both.
2. If any employer or any other person-
a. required to furnish any information or return:
(i) refuses or neglects to furnish such information or return, or
(ii) furnishes or causes to be furnished any information or return which is false and which is
either knows or believes to be false or does not believe to be true, or
(iii) refuses to answer, or give a false answer to any question necessary for obtaining any
information required to be furnished by him, or
b. refuses or willfully neglects to afford the Central or the State Apprenticeship Adviser or such
other person, not below the rank of an Assistant Apprenticeship Adviser, as may be
authorized by the central or the State Apprenticeship Adviser in writing in this behalf any
reasonable facility for making any entry, inspection, examination or inquiry authorized by or
under this Act, or
c. requires an apprentice to work overtime without the approval of the Apprenticeship Adviser,
or
d. employs an apprentice on any work which is not connected with his training, or
e. makes payment to an apprentice on the basis of piece-work, or
f. requires an apprentice to take part in any output bonus or incentive scheme. He shall be
punishable with imprisonment for a term which may extend to six month or with fine or with
both.
Penalty where no specific penalty is provided

If any employer or any other person contravenes any provision of this Act for which no punishment
is provided in section 30, he shall be punishable with fine which shall not be less than one thousand
rupees but may extend to three thousand rupees.
Power to make rules

1. The Central Government may, after consulting the Central Apprenticeship Council, by
notification in the Official Gazette, make rules for carrying out the purposes of this Act.
2. Rules made under this Act may provide that a contravention of any such rule shall be punishable
with fine which may extend to fifty rupees.
3. Every rule made under this section shall be laid as soon as may be after it is made before such
House of Parliament while it is in session for a total period of thirty days which may be
composed 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 rules 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 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 .
UNIT 6
EMPLOYEES STATE INSURANCE ACT, 1948

26. STATE OBJECT, PURPOSE, SCOPE AND EXPLAIN THE VARIOUS BENEFITS
PROVIDED TO INSURED PERSON AND THEIR DEPENDENT UNDER THE
EMPLOYEES STATE INSURANCE ACT, 1948.
- Many important Social Security Schemes had been introduced in our country before
independence. The urgency of such Schemes has been more badly felt after World War II.
Social security to the workers of an industry can be provided by a self-balancing Scheme of
Social Insurance or by public assistance or a combination of the two methods.
- Social security measures adopted in any country can be said to be dependent upon a number of
factors viz., population, economic resources, standard of living, and availability of technical
experts and development of industry.
- The Workmen's Compensation Act, though designed to protect and safeguard the interest of the
labour was in the nature of social assistance and not social insurance.
- The Employees' State Insurance Act was first of such measures adopted in India to provide for
social insurance to the labourers. Many other fields of social insurance like health and
unemployment are still left untouched. The Employees' State Insurance Act is a legislation
which aims at bringing about social and economic justice to the poor labour class of the land. It
aims at the labour welfare.
- Origin: The Employee State Insurance act was promulgated by the Parliament of India in the
year 1948.To begin with the ESIC scheme was initially launched on 2nd February 1952 at just
two industrial centers in the country namely Kanpur and Delhi with a total coverage of about
1.20 lakh workers. There after the scheme was implemented in a phased manner across the
country with the active involvement of the state governments.
- Objectives: The ESI Act is a social welfare legislation enacted with the object of providing
certain benefits to employees in case of sickness, maternity and employment injury. Under the
Act, employees will receive medical relief, cash benefits, maternity benefits, pension to
dependents of deceased workers and compensation for fatal or other injuries and diseases.
- Extent: The ESI Act extends to the whole of India.
- Application:
a. It applies to all the factories including Government factories (excluding seasonal factories),
which employ 10 or more employees and carry on a manufacturing process with the aid of
power and 20 employees where manufacturing process is carried out without the aid of
power.
b. The act also applies to shops and establishments. Generally, shops and establishments
employing more than 20 employees are covered by the Act.
c. The act does not apply to any member of Indian Naval, Military or Air Forces.
d. All employees including casual, temporary or contract employees drawing wages less than
Rs 10,000 per month are covered. The ceiling limit has been raised from Rs.7500 to
Rs.10000 with effect from 01.10.06.
e. Apprentices covered under the Apprenticeship Act are not covered under this Act. According
to Apprenticeship Act 1961.
f. A factory or establishment, to which this Act applies, shall continue to be governed by its
provisions even if the number of workers employed falls below the specified limit or the
manufacturing process therein ceases to be carried on with the aid of power subsequently.
g. Where a workman is covered under the ESI scheme, Compensation under the Workmen's
Compensation Act cannot be claimed in respect of employment injury. No benefits can be
claimed under the Maternity Benefits Act.
Benefits provided under the ESI Act are:
- Benefits are found in Section 46 of the Act.
- The purpose of the Employees' State Insurance Act is to provide benefits to the insured persons
or their dependents.
- The following benefits are provided under Section 46.
1. Sickness benefit
2. Maternity benefit
3. Disablement benefit
4. Dependents benefit
5. Medical benefit
6. Funeral benefit
1. Sickness benefit:
- It is in the form of periodical payment to any insured person, provided his sickness is
certified by a duly appointed medical practitioner, or any person having such
qualifications and experience as may be specified by regulations of the Corporation.
- A few characteristics of sickness benefit are given below:
a. It consists of periodical payments.
b. It is payable to an insured person.
c. It is payable for sickness which has been defined in Section 2(20) of the Act.
d. It is payable to an insured person whose condition requires both medical treatment and
attendance and necessitates abstention from work.
e. Sickness must be certified by a duly appointed practitioner.
f. It is subject to fulfilment of prescribed contributory conditions.
- Rule 55 of ESI (Central Rules) 1950 makes the following provisions for sickness
benefits:
a. A person shall be qualified to claim sickness benefit for sickness occurring during any
benefit period if the contributions in respect of him were payable for not less than 78
days in the corresponding contribution period.
b. Sickness benefits can be received at the daily standard benefit rate for the period of his
sickness.
c. In case of a person who becomes an employee for the first time and for whom a
shorter contribution period of less than 156 days is available, he shall be qualified to
claim sickness benefit if the contribution in respect of him were payable for not less
than half the number of days available for working in such contribution period.
d. A person shall not be entitled to the benefits for the first 2 days of sickness. But if
spell of sickness recurs within 15 days he shall be entitled to recover the benefits even
for the first two days in the second and subsequent spell.
e. Sickness benefit shall not be paid to any person for more than 91 days in any 2
consecutive benefits periods.
f. The daily rate of sickness benefits in respect of a person during any benefit period
shall be 75% of the standard benefit rate of that person during the corresponding
contribution period rounded to the next higher rupee.
- Extended sickness benefit:
a. Extended sickness benefit is payable to insured persons for the period of certified
sickness in case of specified 34 long-term diseases that need prolonged treatment and
absence from work on medical advice.
b. For entitlement to this benefit an insured person should have been in insurable
employment for at least 2 years. He/ she should also have paid contribution for a
minimum of 156 days in the preceding 4 contribution periods or say 2 years.
c. ESI is payable for a maximum period of 2 years on the basis of proper medical
certification and authentication by the designated authority.
d. Amount payable in cash as extended sickness benefit is payable within 7 days
following the submission of complete claim papers at the local office concerned.
- Enhanced sickness benefit
a. This cash benefit is payable to insured persons in the productive age group for
undergoing sterilization operation, viz., vasectomy/ tubectomy.
b. The contribution is the same as for the normal sickness benefit.
c. Enhanced sickness benefit is payable for 14 days for tubectomy and for seven days in
case of vasectomy.
- 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.
- An award of seven days' sick leave on production of a medical certificate in addition to
the benefits under the Employees' State Insurance Act was held justified by the Supreme
Court.
- The sickness benefit shall be paid at the rates specified in the First Schedule.
2. Maternity Benefit:
- This benefit in the form of periodical payment available to an insured woman.
- Maternity benefit is cash payable to an insured woman for the specified period of
abstention from work for confinement or miscarriage or for sickness arising out of
pregnancy, confinement, premature birth of child or miscarriage.
- Criminal abortion or miscarriage does not, however, entitle to benefit.
- The grounds of eligibility of an insured woman to such payments must be certified by an
Insurance Medical Officer as provided by the regulations. She must produce proofs of the
same.
- The contribution condition is the same as for sickness benefit. The daily rate is double the
sickness benefit rate and is thus roughly equivalent to the full wages.
- A benefit is paid for Sundays too.
- The benefits paid are as follows:
1. For confinement
2. For miscarriage
3. For sickness arising out of pregnancy
4. For premature birth of a child.
1. For confinement
- For a total period of 12 weeks beginning not more than 6 weeks before the
extended date of child birth, if the insured women dies during confinement or
within 6 weeks thereafter, leaving behind the living child, the benefit continues to
be payable for the whole of the period.
- But the child also dies during that period, the benefit will be paid up to and
including the day of the death of the child.
2. For miscarriage
- For the period of 6 weeks following the date of miscarriage.
3. For sickness arising out of pregnancy
- An additional period or up to four weeks.
4. For premature birth of a child.
- An additional period or up to four weeks.
- In all the cases, the benefit is paid only if the insured woman does not work for
remuneration during the period for which benefit is claimed. There is no waiting period.
- Medical Bonus is lump sum payment made to an insured woman or the wife of an insured
person in case she does not avail medical facility from an ESI hospital at the time of
delivery of a child.
- 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.
3. Disablement benefit:
- Any insured person shall be entitled to periodical payments if
a. he suffers from disablement;
b. the disablement results from an employment injury; and
c. he sustained the employment injury as an employee under condition mentioned in the
Act.
- The disablement benefit is payable only when the· injury is duly certified by an Insurance
Medical Officer.
- Temporary disablement benefit - TDB:
 It is payable at prescribed rate to an employee who suffers employment injury or
occupational disease and is certified to be temporarily incapable to work.
 In order to get benefits certificates in prescribed form is required to be submitted.
 During of TDB. There is no prescribed limit for the duration of TDB. This is payable
as long as temporary disablement lasts and significant improvement by treatment is
possible. If a temporary disablement spell last for less than 3 days insured person will
be paid sickness benefit, if otherwise eligible.
- Permanent Disablement Benefit – PBD
 PDB is payable at prescribed rate to an insured person who suffers permanent residual
disablement as a result of employment injury including occupational diseases and
results in loss of earning capacity.
 The proper authority for assessing loss of earning capacity for injuries are the Medical
Board for occupational disease, Special Medial Board.
4. Medical benefit:
- Medical benefit is available to an injured person or to a member of his family, where such
benefit is extended to the members of his family.
- This benefit is in the following forms:
a. out-patient treatment and attachment in the hospital or dispensary; or
b. by visits of the home of the insured; or
c. as an in-patient in a hospital or other institution.
- The ESI scheme provides full medical care in the form of medical attendance, treatment,
drugs, and injections, specialist consultation and hospitalization to insured persons and
also, to members of their families where the facility for specialist consultation,
hospitalization has been extended to the families.
- For the families, this benefit has been divided into two categories as under:
a. Full Medical Care: this consists of hospitalization facilities and includes specialist’s
service, drugs and dressings and diets as required for in-patients.
b. Expanded Medical Care: this consists of consultation with the specialists and supply
of special medicine and drugs as may be prescribed by them in addition to the out-
patient care. This also includes facilities for special laboratory tests and x-ray
examinations.
5. Funeral expenses:
- Funeral expenses are payable to the eldest surviving member of the family or to such
person who actually incurs funeral expenses.
- The funeral expenses are in the nature of a lump sum payment made to defray the
expenditure on the funeral of deceased insured person.
- Amount of funeral expenses will be as per Rules made in this behalf, which is presently
Rs. 10,000.
- The amount of such payment shall not exceed such amounts as may be prescribed by the
Central Government.
- Any claim for the funeral expenses must be made within three months of the death of the
insured person or within such extended period as the Corporation or any other competent
official may allow.
6. Dependents benefit:
- This benefit is available to such dependents, of an insured person who dies as a result of
an employment injury sustained as an employee, as are entitled to compensation under
this Act.
1. In case of death of the insured person, the dependent’s benefit shall be payable:
a. To the widow during life until remarriage – the amount, equal to 3/5 of the full
rate, and if there are two or more widows – equally divided.
b. To each legitimate or adopted son – 2/5 of the full rate until he attains the age of 18
years. If the legitimate son is infirm and dependent on the earnings of the insured
person then it will continue till the infirmity lasts.
c. To each legitimate or adopted unmarried daughter – 2/5 of the full rate until she
attains the age of 18 or until marriage, whichever is earlier.
2. In case the deceased does not have a widow or legitimate/adopted child.
a. To a parent or grandparent – for life 3/10 of full rate.
b. To any other – male dependent till he attains 18 years of age. Female dependent till
she attains 18 years of age or until marriage, whichever is earlier = 2/10 of the full
rate.
- If any 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) dependent’s benefit shall be
payable at such rates and for such periods and subject to such conditions as may be
prescribed by Central Government to his dependents specified in sub-clause (i), sub-
clause (i-a) and sub-Clause (ii) of clause (6-A) of Section 2.
- In case the insured person dies without leaving behind him the dependents as
aforesaid, the dependent’s benefit shall be paid to the other dependents of the deceased
at such rates and for such period and subject to such conditions as may be prescribed
by the Central Government. Section 52(a).
Recipient of sickness or disablement benefits to observer the following conditions
- A person who is in receipt of sickness benefit or other benefits:
a. Shall remain under the medical treatment at a dispensary, hospital, clinic or other institution
provided under the Act and shall carry out the instructions given by the medical officer or
medical attendant.
b. Shall not do anything, while under treatment, which might retard or prejudice his changes of
recovery.
c. Shall not leave the area in which medical treatment is being given, without the permission of
the medical officer, medical attendant
d. Shall allow himself to be examined by any duly appointed medical officer of other person
authorized by the corporation.
Benefits not to be combined
- An insured person shall not be entitled to receive for the same period
a. Both sickness and maternity benefit.
b. Both sickness and disablement benefit for temporary disablement.
c. Both maternity and disablement benefit for temporary disablement.
Where a person is entitled to more than one of the benefits, he shall be entitled to choose
which benefit he shall receive.
Rules As regards accidents
- Presumption as to accident arising in course of employment: Section 51A provides that if it
is shown that the accident arose in the course of employment of an insured person, it would be
presumed also to have arisen out of employment. But the presumption is a rebut table one and
applied to this Act only.
- Accident happening while acting in breach of regulations: Section 51B of the Act provides
an explanation to the expression “out of and in the course of employment”. An accident shall be
deemed to arise out of and in the course of employment if the act is done for the purpose of and
in connection with employer's trade or business unless
a. the insured person is at the time of accident acting in contravention of the provisions of any
law applicable to him; or
b. the insured person is acting in contravention of any orders given by or on behalf of his
employer; or
c. he is acting with instructions from his employer:
- Accident happening while travelling in employer's transport: Section 51C of the Act
incorporates the principle of notional extension of employer's premises. This section lays down
the liability of the employer for the payment of benefit for accident arising while an employee is
traveling in any transport provided by the employer while going to or coming from work. The
conditions for holding the employer liable are the following
a. an insured person must be traveling by any vehicle with the express or implied permission of
his employer;
b. he must be going to or coming from his place of work;
c. the vehicle must be operated by or on behalf of his employer or some other person in
pursuance of an agreement made with the employer;
d. the vehicle is not being operated in the ordinary course of public transport service.
- Occupational Disease: The expression “occupational disease” has nowhere been defined in the
Act, but a list of these diseases along with the employments peculiar to them is given in the
third schedule of the Act. Any employee who contracts any such occupational disease while
working in any of these employments shall be deemed to have extracted an employment injury.
The third schedule is divided into three parts. For occupational disease mentioned in Part A no
period of employment is necessary; but in case of any disease mentioned in Part B of Schedule
III, the insured person must have served in the employment peculiar to that disease for a period
of not less than 6 months.
27. WRITE SHORT NOTES ON EMPLOYEES STATE INSURANCE FUND, THE PURPOSE
FOR WHICH THE FUND MAY BE EXPENDED, CONTRIBUTIONS TO FUND.
EMPLOYEES STATE INSURANCE FUND
- All contributions paid under the employees' State Insurance Act and all other moneys received
on behalf of the Corporation shall be paid into the Employees' State Insurance Fund.
- The Employees' State Insurance Fund shall be held and administered by the Corporation for the
purposes of this Act.
- According to sub-section (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.
- All moneys accruing or payable to the Employees' State Insurance Fund shall be paid into the
Reserve Bank of India or such other bank as may be approved by the Central Government.
PURPOSE FOR WHICH THE FUND MAY BE EXPENDED
- Fund shall be expended only for the following purposes:
a. payment of benefits and provision of medical treatment and attendance to insured persons
and, defraying the charges and costs in connection therewith;
b. payment of fees and allowances to members of the Corporation, the Standing Committee and
the Medical Benefit Council, the Regional Boards, Local Committees and Regional and
Local Medical Benefit Councils;
c. payment of salaries, leave and joining time allowances, travelling and compensatory
allowances, gratuities and compassionate allowances, pensions, contributions to provident or
other benefit fund of officers and servants of the Corporation and meeting the expenditure in
respect of offices and other services set up for the purpose of giving effect to the provisions
of this Act;
d. establishment and maintenance of hospitals, dispensaries and other institutions and the
provision of medical and other ancillary services for the benefit of insured persons and,
where the medical benefit is extended to their families, their families;
e. payment of contributions to any State Government, local authority or any private body or
individual, towards the cost of medical treatment and attendance provided to insured persons
and, where the medical benefit is extended to their families, their families including the cost
of any building and equipment, in accordance with any agreement entered into by the
Corporation;
f. defraying the cost (including all expenses) of auditing the accounts of the Corporation and of
the valuation of its assets and liabilities;
g. defraying the cost (including all expenses) of the Employees' Insurance Courts set up under
this Act;
h. payment of any sums under any contract entered into for the purposes of this Act by the
Corporation or the Standing Committee or by any officer duly authorized by the Corporation
or the Standing Committee in that behalf;
i. payment of sums under any decree, order or award of any Court or Tribunal against the
Corporation or any of its officers or servants for any act done in the execution of his duty or
under a compromise or settlement of any suit or other legal proceeding or claim instituted or
made against the Corporation;
j. defraying the cost and other charges of instituting or defending any civil or criminal
proceedings arising out of any action taken under this Act;
k. defraying expenditure, within the limits prescribed, on measures for the improvement of the
health and welfare of insured persons and for the rehabilitation and re- employment of
insured persons who have been disabled or injured; and
l. Such other purposes as may be authorized by the Corporation with the previous approval of
the Central Government.
CONTRIBUTIONS TO FUND
- Contribution means the sum of money payable to the corporation by the principal employer in
respect of an employee and includes the amount payable by the employee in accordance with
the provisions of this Act.
- All employees to be insured.- Subject to the provisions of this Act, all employees in factories or
establishments to which this Act applies shall be insured in the manner provided by this Act.
- Such insured person are entitled to get certain benefits from that fund which shall be
administered by the corporation.
- Any dispute will be settled by the Employees Insurance Court.
CONTRIBUTIONS
1. All employees in factories or establishment shall be insured in the manner provided by this
Act. For the employee to be insured two conditions are provided:
a. He must be employed in a factory or an establishment.
b. Contributions must be either paid or payable to him under the Act.
2. The contributions payable under this Act shall comprise of employers contribution and
employees contribution.
3. It shall be paid to the corporation.
4. The contribution shall be paid at such rates as may be prescribed by the Central Government.
Presently rate of contribution are as follows:
a. The employee’s contribution is 1.75%.
b. The employer’s contribution is 4.75%.
5. All contributions shall be payable for wage period.
6. The contributions payable of each wage period shall fall due on the last day of the wage
period.
7. If any contribution is not paid by the principal employer within prescribed period then
employer shall be liable to pay simple interest at 12% or at prescribed higher rate, till the date
of its actual payment. However higher interest should not exceed the lending rate of interest
charged by any scheduled bank. Any interest recoverable as stated above may be recovered as
an arrear of land revenue.
8. The contribution is deposited by the employer in cash or by cheque at the designated branches
of some nationalized banks. The responsibility for payment of all contributions is that of the
employer with a right to deduct the employees share of contribution from employees’ wages
relating to the period in respect of which the contribution is payable.
9. There are two contribution periods each of six months duration and two corresponding benefit
periods. Cash benefits under the scheme are generally linked with contribution paid.
10. Contribution period - 1st April to 30th September, its corresponding Cash Benefit period is 1st
January to 30th June of the following year.
11. Contribution period - 1st October to 31st March, its corresponding Cash Benefit period is 1st
July to 31st December of the following year.
12. Principal employer to pay contributions in the first instance:
- The principal employer to pay contribution for all employees whether employed directly or
through contractor.
- However, the employer can recover from the employee the employee’s contribution by
deduction from his wages.
- The principal employer also has to bear the expenses of remitting the contribution to the
ESI Corporation.
13. Recovery of contribution from immediate employer:
- Principal employer who has paid contribution in respect to an employee employed by or
through an immediate employer is entitled to recover the amount of contribution so paid
(both employer and employee contribution) from the immediate employer either by
deduction from any amount payable to him by the principal employer under any contract or
as a debt payable by the immediate employer.
- The immediate employer is required to maintain a register of employees employed by or
through him as provided in the Regulations and submit the same to the principal employer
before the settlement of any amount payable. He is not required to have separate account
with ESI.
PROVIDENT FUND AND MISCELLANEOUS PROVISIONS ACT

28. DISCUSS IN BRIEF IMPORTANT SCHEMES UNDER THE EMPLOYEE’S PROVIDENT
FUND AND MISC. PROVISIONS ACT, 1952.
SCHEMES UNDER THE EPF ACT
There are three beneficial schemes under the EPF ACT. They are:
1. Employees Provident Fund Scheme 1952
2. Employees Pension Scheme 1995
3. Employees Deposit Linked Insurance 1976
1. EMPLOYEES PROVIDENT FUND SCHEME 1952

Central Government to frame Employees' Provident Fund Scheme
- Section 5 of the Act authorizes the Central Government to frame Employees' Provident Fund
Scheme for the establishment of Provident Fund under this Act.
- The Central Government shall have to issue a notification in the Official Gazette before
framing any such scheme.
- The scheme shall apply to employees or any class of employees of an establishment or class
of establishments as specified in it. The word 'specify' means that there should be no room
for uncertainty in mentioning or naming the establishment to which the scheme is to be
applied. I after the framing of the scheme as soon as possible, a Fund shall be established in
accordance with the provisions of this Act and the scheme.
- The fund shall vest in and be administered by the Central Board, constituted under Section
5A. Subject to the provisions of this Act.
- A Provident Fund Scheme may provide for all or any of the matters specified in Schedule II.
Any such scheme shall take effect either prospectively or retrospectively on such date as may
be specified in the Schedule.
- The power of the Central Government to frame a scheme is neither unrestricted nor
unguided. There are various provisions in the Act for the guidance of the Central
Government. It is an idle contention that Section 5 gives wholly unrestricted and unguided
direction to the Central Government to frame a scheme, and it appears on the other hand that
the Act is full of carefully laid down principles to guide the Central Government.
- Two distinct powers are conferred on the Central Government by Section 5(1) namely,
(i) to frame a scheme, and
(ii) to specify to which factories the scheme shall apply. Both these powers can be exercised
through the medium of a single notification. Further the factories to which the scheme
shall apply may be specified in the scheme itself.
Contributions and matters which may be provided for in the scheme

- Employer is required to pay PF contribution at 12% of (Basic wages + Dearness Allowance
+ Retaining Allowance)
- Employee is also required to pay 10% or 12% contribution.
- In case pay is more than 15,000 per month, the contribution is payable only on 15,000.
- If employees are employed through contractor then principal employer is liable to
contribution, which can be recovered from contractor. The employer can voluntarily pay
higher contribution above 10% to 12%. However, employer liable to pay contribution only at
statutory rate i.e. 10% top 12%. The amount received by way of provident fund contributions
is invested by the Board of Trustees in accordance with the investment pattern approved by
the Government of India.
- Where the amount of any contribution payable under this Act involves a fraction of a rupee,
the scheme may provide for the rounding’s off of such fraction to the nearest rupee, half of a
rupee or quarter of a rupee. For some industries it is 10%.
For what purpose may a member withdraw a certain amount from his provide fund
account
- For payment of life insurance premium.
- Withdrawal for purchase a dwelling place or flat or for construction of a dwelling house
including the acquisition of a suitable site for the purpose, or for completing/continuing the
construction of a dwelling house, already commenced by the member or the spouse and an
additional advance for additions, alteration or substantial improvement necessary to the
dwelling house.
- Non-refundable advance to the members due to temporary closure of any factory or
establishment for more than 15 days for reasons other than a strike or due to non-receipt of
wages for 2 months or more, and refundable advance due to closure of the factory or
establishment for more than 6 months.
- Non-refundable in case of:
a. Hospitalization lasting 1 month
b. Major surgical operation in a hospital
c. Suffering from TB, Leprosy, paralysis, cancer, mental derangement or heart ailment
Non-refundable advance for the treatment of a members of his family, who has been
hospitalized or requires hospitalization, for one month or more:
a. Major surgical operation in a hospital
b. Suffering from TB, Leprosy, paralysis, cancer, mental derangement or heart ailment
- Non-refundable advance for daughter/sons marriage, self-marriage, the marriage of
sister/brother or for the post matriculation education of son or daughter.
- Non-refundable advance to members affected by cut in the supply of electricity.
- Non-refundable advance in case property is damaged by a calamity of exceptional nature
such as floods, earthquake or riots.
- Withdrawals for repayment of loans in special cases and
- Non-refundable advance to physically handicapped members for purchasing equipment
required to minimize the hardship on account of handicap.
- Full withdrawal when he ceases to be in employment.
Central Board for administering the employee’s provident fund
- Section 5(a). Central Board: The Central Government may by a Gazette notification
constitute Board of Trustees caned Central Board for administering the Employees'
Provident Fund in the territories to which this Act extends.
- The Central Board shall come into force from such date as may be specified in the
notification, and shall consist of the following persons as members–
a. a Chairman and a Vice-Chairman to be appointed by the Central Government;
b. the Central Provident Fund Commissioner, ex-officio;
c. not more than five persons appointed by the Central Government from amongst its
officials;
d. not more than fifteen persons representing Government of such State as the Central
Government may specify in this behalf, appointed by the Central Government;
e. Ten persons representing employers, or the establishment to which the Scheme applies,
appointed by the Central Government after consultation with such organizations of
employers as may be recognized by the Central Government in this behalf; and
f. Ten persons representing employers, in the establishment 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.
- The terms and conditions subject to which a member of the Central Board may be appointed
shall be such as may be provided for in the Scheme.
- The time, place and procedure of the meetings of the Central Board shall be such as may be
provided for in the Scheme.
- The Central Board shall subject to the provisions of Section 6-A and Section 6-C administer
the Fund, vested in it in such manner as may be specified in the scheme. The Central Board
shall perform such other functions as it may be required to perform by or under any
provisions of the Scheme, the Family Pension Scheme and the Insurance Scheme.
2. Employees’ Pension Scheme 1995

- The Central Government has introduced a new pension scheme styled Employees’ Pension
Scheme, 1995.
- The scheme is applicable to all persons who become member of the provident fund.
- 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;
b. widow or widower's pension, children pension or orphan pension payable to the
beneficiaries of such employees.
- The salient features of the Employees’ Pension Scheme are:
a. Out of employer’s contribution 8.33% of the basic wages, dearness allowance and
retaining allowance goes to Employees’ Pension Scheme.
b. The pension fund shall vest in and be administered by the Board.
c. Pension scheme may provide for all or any of the matters specified in Schedule III.
d. Minimum 10 years contributory service is required for entitlement to pension.
e. Normal superannuation pension is payable on attaining the age of 58 years.
f. The scheme provides for payment of monthly pension in the following contingencies:
1. Superannuation on attaining the age of 58 years.
2. Retirement
3. Permanent total disablements
4. Death during service
5. Death after retirement or superannuation or permanent total disablement
6. Children pension
7. Orphans pension.
g. The scheme provides for payment of monthly pension to family in case of death of
employee. If the person is unmarried or has not family, pension is available to nominee
for a specified period.
h. The amount of monthly pension will vary from member to member depending upon his
pensionable salary and pensionable service. The formula for calculation of monthly
pension is as under:
Members Pension = Pension salary x (Pensionable service + 2)
70
Pensionable salary is average of last 12 months pay.
3. Employees Deposit Linked Insurance 1976

- The Act was amended in 1976 and a new Section 6B was inserted empowering the Central
Government to frame a Scheme to be called the Employees’ Deposit Linked Insurance
Scheme EDLI for the purpose of providing life insurance benefit to the employees of any
establishment or class of establishments to which the Act applies:
- Salient feature of EDLI
a. The purpose of EDLI is to provide life insurance benefit to employees.
b. Employer is required to pay contribution which cannot be more than 1% of pay of
employee. Presently it is 0.5%, plus administrative charges 0.01% of the pay subject to a
minimum of Rs. 2 PM.
c. The insurance fund shall vest and administered by the Central Board.
d. The insurance scheme may provide for all or any of the matters specified in Schedule IV.
e. Nomination: The nomination made by a member have overriding effect and will override
the personal laws of the subscriber.
f. Payment of assurance benefit: in case of death of a member, an amount equal to the
average balance during the preceding 12 months will be paid. In case the average balance
exceeds Rs. 35000 the amount payable shall be Rs. 35,000 plus 25% of the amount of
such excess subject to a ceiling of Rs. 60,000.
29. DISCUSS THE OBJECTS, EXTENT, APPLICATION EMPLOYEE AND EMPLOYER

AND MISC. PROVISIONS ACT, 1952.
- It is an Act to provide for the institution of provident funds, pension funds and deposit linked
insurance fund for the employees in the factories and other establishments.
- The Act extends to the whole of India except the State of Jammu and Kashmir.
- The principal duty is laid upon the employer to put the Provident Fund Scheme into operation
and to make contribution of both the employees' and employer's share to the fund then and there
and deduct the employees' share from their wages.
- The Act applies to
a. Every factory engaged in industry specified in Schedule I and in which 20 or more persons
are employed.
b. Other establishments employing 20 or more persons notified by Central Government in the
official gazette.
The Central Government may after giving not less than 2 months’ notice in the Official
Gazette apply the provisions of this Act to any establishment employing such number of
persons less than 20.
The Central PF Commissioner on an application by employer and the majority of employees
of any establishment apply the provisions of this Act to that establishment. An establishment
to which the EPF Act applies shall continue to be governed by the Act even if the number of
persons employed falls below 20 at any time.
- The Act shall not be applicable to
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 cooperative 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 or the State 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.
EMPLOYER
- Section 2(e): 'Employer' in relation to an establishment which is a factory means
a. the owner or occupier of the factory;
b. the agent of such owner or occupier;
c. the legal representative of a deceased owner or occupier of the factory; or
d. any person named as a manager of the factory under Section 7(1)(f) of the Factories Act,
1948.
In relation to any other establishment, 'employer' means
a. the person who has the ultimate control over the affairs of the establishment ; or
b. the authority which has the ultimate control over the affairs of the establishment; or
c. where the affairs of an establishment are entrusted to a manager, managing director or
managing agent, such manager, managing director or managing agent.
A receiver appointed under Order XL, Rule I, C.P.C. to take possession of all the properties of
the partnership is an employer within the meaning of this sub-section, where the receiver so
appointed had all the powers except that in certain things he was required to take permission
from the Court.3 He had also power to employ additional staff with the permission of the Court.
When such a receiver was prosecuted for breach of the provisions of the P.E Scheme he pleaded
that he was not 'employer' within the meaning of Section 2(e) of the Act.
EMPLOYEE
- Section 2(f): Before a person can be said to be an 'employee' .there must be proof
a. that he is employed,
b. that he is employed for wages,
c. that he is employed in work, manual or otherwise,
d. that the work is in connection with the work of a factory (establishment), and
e. that he gets his wages directly or indirectly from the employer. Employee includes any
person
1. employed by or through a contractor in or in connection with the work of the
establishment;
2. engaged as an apprentice not being an apprentice engaged under the Apprentices Act,
1961, or under the standing order of the establishment.
- Persons employed by or through a contractor in or in connection with the work of the
establishment shall be included as employee provided that they have completed the period of
working days laid down in the scheme for entitling an employee to the benefits of the fund.
- For a person to be an employee it is not necessary that he should actually be employed in the
establishment itself, it is sufficient if he is employed in connection with any work of the
establishment. Further, it is also not necessary that a person should be employed for any manual
work; the expression 'employee' includes a person employed for clerical or other work in or in
connection with the work of the establishment.
- In Mohammed Ali v/s Union of India,4 it was argued that the Act was intended by Parliament to
apply to employees who were mere wage earners and not to the salaried servants. The
contention was rejected by the Supreme Court.
- In Victoria Jubilee Technical Institute v. K.S. Naik, R.P. F. Commissioner, Maharashtra and
others the Victoria Institute trained students in electrical, mechanical and general engineering in
laboratories and workshops attached to the Institute. The question was whether workshops and
laboratories attached to the Institute will make it a factory.
- It was held that the petitioner Institute cannot be described as engaged in production of
electrical, mechanical and general engineering goods. The Institute has several laboratories and
workshops attached to its departments for the purpose of training students and to give practical
experience in their field of study.
- In laboratories and workshops students are given training under the guidance of the teaching
staff. The product manufactured, by the students are not sold, nor the Institute derives any
monetary benefit out of such production. Therefore, the Institute is not engaged in the
production of such goods. The expression “engaged” indicates the commercial production or
production as a primary concerned and by no stretch of imagination can educational institution
be treated as engaged in production of these goods and hence it is not a factory.
PAYMENT OF BONUS ACT, 1965

30. OBJECTS AND MAIN PROVISIONS OF PAYMENT OF BONUS ACT, 1965. WHO ARE
THE CLASS OF EMPLOYEES NOT COVERED UNDER BONUS ACT?
EXPLAIN THE FOLLOWING WITH REFERENCE TO PAYMENT OF BONUS ACT,
1965 – ELIGIBILITY AND DISQUALIFICATION FOR BONUS. AND PAYMENT OF
MINIMUM AND MAXIMUM BONUS.
ORIGIN
- The practice of paying bonus in India appears to have originated during First World War when
certain textile mills granted 10% of wages as war bonus to their workers in 1917.
- In certain cases of industrial disputes demand for payment of bonus was also included. In 1950,
the Full Bench of the Labour Appellate evolved a formula for determination of bonus.
- A plea was made to raise that formula in 1959.
- At the second and third meetings of the Eighteenth Session of Standing Labour Committee
(G.O.I.) held in New Delhi in March/April 1960, it was agreed that a Commission be appointed
to go into the question of bonus and evolve suitable norms.
- A Tripartite Commission was set up by the Government of India to consider in a comprehensive
manner, the question of payment of bonus based on profits to employees employed in
establishments and to make recommendations to the Government.
- The Government of India accepted the recommendations of the Commission subject to certain
modifications. To implement these recommendations the Payment of Bonus Ordinance, 1965
was promulgated on 29th May, 1965.
- To replace the said Ordinance the Payment of Bonus Bill was introduced in the Parliament.
OBJECT
- An Act to provide for the payment of bonus to persons employed in certain establishments on
the basis of profits or on the basis of production or productivity and for matters connected
therewith.
- To impose statutory liability upon an employer of many establishments covered by the Act to
pay bonus to employees to the establishment.
- To define the principle of payment of bonus according to the prescribed formula.
- To provide for payment of minimum and maximum bonus and linking the payment of bonus
with the scheme of set off and set on.
- To provide machinery for enforcement of the liability for payment of bonus.
- To make other provisions like eligibility, disqualification, recovery of bonus and offence and
penalties.
APPLICABILITY
- The Payment of Bonus Act, 1965 shall apply to
a. Every factory
b. Every other establishment in which 20 of more persons are employed on any date during an
accounting year.
- The appropriate Government may, after giving not less than two months’ notice in the Official
Gazette, apply the provisions of this Act to any establishment or class of establishment
employing such number of persons less than twenty as may be specified in the notification; so,
however, that the number of persons so specified shall in no case be less than ten.
- As per Section 1(5), an establishment to which this Act applies shall continue to be governed
by this Act even if the number of persons employed therein falls below twenty.
- The Act is not to apply to:
a. employees of the Life Insurance Corporation of India;
b. seamen as defined in clause (42) of section 3 of the Merchant Shipping Act, 1958 ( 44 of
1958);
c. employees registered or listed under any scheme made under the Dock Workers (Regulation
of Employment) Act, 1948 (9 of 1948), and employed by registered or listed employers;
d. employees employed by an establishment engaged in any industry carried on by or under the
authority of any department of
1. the Central Government or
2. a State Government or
3. a Local authority;
e. employees employed by
1. the Indian Red Cross Society or any other institution of a like nature (including its
branches);
2. universities and other educational institutions;
3. institutions (including hospitals, chambers of commerce and social welfare institutions)
established not for purposes of profit;
f. employees employed through contractor on building operations;
g. employees employed by the Reserve Bank of India;
h. employees employed by –
1. the Industrial Finance Corporation of India;
2. any Financial Corporation established under section 3, or any Joint Financial Corporation
established under section 3A, of the State Financial Corporations Act, 1951 (63 of 1951);
3. the Deposit Insurance Corporation;
4. the National Bank for Agriculture and Rural Development
5. the Unit Trust of India;
6. the Industrial Development Bank of India;
7. the Small Industries Development Bank of India established under section 3 of the Small
Industries Development Bank of India Act, 1989;
8. the National Housing Bank
i. any other financial institution other than a banking company, being an establishment in
public sector, which the Central Government may, by notification in the Official Gazette,
specify, having regard to
1. its capital structure;
2. its objectives and the nature of its activities;
3. the nature and extent of financial assistance or any concession given to it by the
Government; and
4. any other relevant factor;
5. employees employed by inland water transport establishment operating on routes passing
through any other country.
EMPLOYER
- Employer includes
1. in relation to an establishment which is a factory:
a. the owner or occupier of the factory,
b. the agent of such owner or occupier,
c. the legal representative of a deceased owner or occupier,
d. person has been named as a manager of the factory.
2. in relation to any other establishment:
a. the person who, or the authority which, has the ultimate control over the affairs of the
establishment and
b. where the said affairs are entrusted to a manager, managing director or managing agent,
such manager, managing director or managing agent.
EMPLOYEE
- Employee includes any person (other than an apprentice) employed on a salary or wage not
exceeding 21,000 per month in any industry to do any skilled or unskilled manual, supervisory,
managerial, administrative, technical or clerical work for hire or reward, whether the terms of
employment be express or implied.
ELIGIBILITY FOR BONUS

- Every employee shall be entitled to bonus provided he has worked in the establishment for not
less than 30 working days in that year.
- As per section 12, salary above Rs. 7000 is not considered for calculation of bonus.
- Employees drawing salary / wage exceeding 21,000 are not entitled to any bonus under the Act.
- Employees of establishment covered u/s 32 are not eligible for bonus.
- Employees of establishment exempted u/s 36 are not eligible for bonus.
Judicial views on eligibility for bonus
- Apprentice is not eligible for bonus.
- Probationer is entitled for bonus.
- A piece-rated worker is entitled for bonus.
- A part time employee as a sweeper engaged on a regular basis is entitled for bonus.
- An employee suspended but subsequently reinstated with full back wages is eligible for bonus
for the period of suspension.
DISQUALIFICATION FOR BONUS
- As per the Act, an employee shall be disqualified from receiving bonus, if he is dismissed from
service for
a. Fraud
b. Riotous or violent behavior
c. Theft, misappropriation, or sabotage of any property of the establishment
COMPUTATION OF NUMBER OF WORKING DAYS FOR BONUS

- An employee shall be deemed to have worked on the following days in any accounting year.
1. He has been laid off under any agreement or as permitted by standing orders under the
Industrial Employment (standing orders) Act, 1946 or under the Industrial Disputes Act or
under any law applicable to the establishment.
2. He has been on leave with salary or wage.
3. He has been absent due to temporary disablement caused by accident arising out of and in
the course of his employment.
4. Employee has been on maternity leave with salary or wage.
MINIMUM AND MAXIMUM BONUS

MINIMUM BONUS
- Every employer shall be bound to pay to every employee a minimum bonus which shall be:
1. 8.33% of the salary or wage of the accounting year or
2. Rs. 100 (Rs. 60 for an employee who has not competed 15 years of age). whichever is
higher.
- Proportionate reduction in minimum bonus: the amount of Rs. 100 or Rs. 60 are to be
proportionately reduced if an employee has not worked for all the working days. This is
permissible only if amount of Rs. 100 or Rs. 60 exceeds 8.33% of salary.
- Even if the employer suffers losses during the accounting year, he is bound to pay minimum
bonus as prescribed in the Act.
MAXIMUM BONUS
- Where for any accounting year, the allocable surplus exceeds minimum bonus the employer
shall be bound to pay bonus which shall be an amount in proportion to the salary or wages or
wage earned during the accounting year subject to a maximum of 20% of such salary or wages.
- In computing the allocable surplus under this section, the amount set-on or set-off shall be takne
into account.
- As per section 12, for calculating the minimum and maximum bonus salary or wages should be
restricted to Rs. 7000.
COMPUTATION OF GROSS PROFITS

The gross profits derived by an employer from an establishment in respect of the accounting year
shall:
a. in the case of a banking company, be calculated in the manner specified in the First Schedule;
b. in any other case, be calculated in the manner specified in the Second Schedule;
COMPUTATION OF AVAILABLE SURPLUS:

The available surplus in respect of any accounting year shall be the gross profits for that year after
deducting therefrom the sums referred to in section 6;
Available surplus means the available surplus computed under section 5.
Particulars Rs. (A) Rs. (B)
Gross profit as per section 4 XXXX
Prior charges allowable as per section 6 XXXX
- Depreciation as per income tax, or agricultural income tax law XXXX
- Development rebate/investment allowance/ development XXXX
allowance deductible under the IT Act.
- Direct tax payable by the employer on his inocme XXXX
- Further sums as are specified in 3rd schedule XXXX
Amount equal to income tax saved on bonus of earlier year XXXX
Available surplus A – B XXXX
ALLOCABLE SURPLUS means-

a. in relation to an employer, being a company other than a banking company which has not made
the arrangements prescribed under the Income-tax Act for the declaration and payment within
India of the dividends payable out of its profits in accordance with the provisions of section 194
of that Act, sixty-seven per cent of the available surplus in an accounting; year;
b. in any other case, sixty percent of such available surplus;
THE PAYMENT OF GRATUITY ACT, 1972

31. EXPLAIN GRATUITY AND DISCUSS THE IMPORTANT PROVISIONS UNDER THE
PAYMENT OF GRATUITY ACT, 1972.
DISCUSS CONTINUOUS SERVICE AND DETERMINATION OF THE AMOUNT OF
GRATUITY.
STATE THE APPLICABILITY AND THE MAIN PROVISION OF PAYMENT OF
GRATUITY ACT, 1972.
- Gratuity is a lumpsum payment to employee when retires or leaves service. The idea behind
payment of gratuity is that by faithful service over a long period the employee is entitled to
claim certain amount as retirement benefit.
- It is reward for long and meritorious service. Maximum gratuity payable under the Act is at
present 20,00,000.
APPLICABILITY
- It extends to the whole of India: Provided that in so far as it relates to plantations or ports, it
shall not extend to the State of Jammu and Kashmir.
- 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.
(d) (3-A) A shop or establishment to which this Act has become applicable shall continue to
be governed by this Act, notwithstanding that the number of persons employed therein at
any time after it has become so applicable falls below ten. This provision is intended to
check the tendency among the employers to artificially reduce the number of employee so
as to get out of coverage of this Act.
- Came in force on 16th September 1972.
CONTINUOUS SERVICE
- The gratuity is given to persons who are in continuous service.
- For the purpose of this Act continuous service means:
(1) An employee shall be said to be in continuous service for a period if he has been in
uninterrupted service: including service which may be interrupted on account of sickness,
accident, leave, lay-off, strike or a lock-out or cessation of work not due to any fault of
the employee.
Absence from duty without leave will be treated as break in service if an order treating
the absence as break in service has been passed in accordance with the standing orders,
rules or regulations governing the employees of the establishment.
(2) Where an employee of non–seasonal establishment is not in continuous service of one
year or six months, as per clause (1) then he shall be deemed to be:
A) in continuous for the said period of one year, if he has actually worked for not less
than:
a. 190 days employed below the ground in a mine or in an establishment which
works for less than six days in a week; and
b. 240 day’s in any other case:
B) In continuous service of 6 months if the has actually worked for not less than
a. 95 days, in the case of an employee employed below the ground in a mine or in
an establishment which works for less than six days in a week; and
b. 120 days, in any other case;
Explanation: For the purpose of clause (2), the number of days on which an employee
has actually worked under an employer shall include the days on which:
(i) he has been laid-off under an agreement or as permitted by standing orders made
under the Industrial Employment (Standing Orders) Act, 1946 (20 of 1946), or under
the Industrial Disputes Act, 1947 (14 of 1947), or under any other law applicable to
the establishment;
(ii) he has been on leave with full wages, earned in the previous year;
(iii) he has been absent due to temporary disablement caused by accident arising out of
and in the course of his employment; and
(iv) in the case of a female, she has been on maternity leave; so, however, that the total
period of such maternity leave does not exceed twelve weeks.
(3) Employee of seasonal establishment is not in continuous service for any period of 1 year
or 6 months, as per clause (1) then he shall be deemed to be in continuous service if he
has actually worked for not less than 75% of the number of days on which the
establishment was in operation during such period.
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.
PAYMENT OF GRATUITY
Payment of Gratuity. When?
- Gratuity shall be payable to an employee on the termination of his employment after he has
rendered continuous service for not less than 5 years,
(a) on his superannuation, or
(b) on his retirement or
(c) resignation,
(d) on his death or disablement due to accident or disease:
- The completion of continuous service of 5 years shall not be necessary where the termination of
the employment of any employee is due to death or disablement:
To whom gratuity is to be paid:
- To the employee himself.
- In case of death of the employee,
 gratuity payable to him shall be paid to his nominee or,
 if no nomination has been made, to his heirs, and
 where any such nominees or heirs is minor, the share of such minor, shall be deposited with
the Controlling Authority who shall invest the same for the benefit of such minor in such
bank or other financial institution, as may be prescribed, until such minor attains majority.
- Disablement: For the purposes of this section, disablement means such disablement as
incapacitates an employee for the work which he was capable of performing before the accident
or disease resulting in such disablement.
Amount of gratuity
- It is calculated on basis of continuous service.
- It is calculated for every completed year of service or part in excess of 6 months, at the rate of
15 days wages last drawn.
- In case of a piece-rated employees, daily wages shall be computed on the average of the total
wages received by him for a period of 3 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.
- In the case of an employee in a seasonal establishment, and who is not so employed throughout
the year, the employer shall pay the gratuity at the rate of 7 days' wages for each season.
Explanation: In the case of a monthly rated employee, the 15 days' wages shall be calculated by
dividing the monthly rate of wages last drawn by him by 26 and multiplying the quotient by
fifteen.
Formulae for calculation of gratuity as stated above:
1. For employees of non-seasonal establishment
a. Time rated employee:
Gratuity = 15 x last drawn wages x no. of completed years of service.
26
b. Piece rated employee:
Gratuity = 15 x average of last 3 months wages x no. of completed years of service.
26
2. For employees of seasonal establishment
a. Those who work throughout the year:
Gratuity = 15 x last drawn wages x no. of completed years of service.
26
b. Those who work only during the season:
Gratuity = 7 x average of last 3 months wages x no. of completed years of service.
26
Maximum amount of gratuity
- The amount of gratuity payable to an employee shall not exceed is twenty lakh rupees.
Gratuity paid to disabled employees
- Employee who is employed, after his disablement, on reduced wages his gratuity will be
calculated in two parts:
a. For the period preceding disablement: on the basis of wages last drawn at the time of
disablement.
b. For the period subsequent to disablement: on the basis of wages last drawn at the time of
termination of employment.
Better terms of gratuity
- An employee may sometimes receive better terms of gratuity under any award or agreement or
contract with the employer. In such case noting contained in section 4 shall affect the right of
employee to receive better terms of gratuity.
Forfeiture of gratuity
- Gratuity will be forfeited, if employee’s service has been terminated.
- It may be for the following reasons:
a. wilful 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. for his riotous or disorderly conduct or any other act of violence on his part; or
c. offence involving moral turpitude, provided that such offence is committed by him in the
course of his employment.
- Gratuity will be forfeited if employee’s service is terminated. Termination of employees is sort
of punishment and before giving punishment a show cause notice must be given and the person
must get an opportunity to be heard as rule of natural justice. If no notice or being heard then it
is illegal and unjustified.
Judicial views:
- The right of forfeiture is limited to extent of the damage. In case of absence of proof of damage,
the right of forfeiture is not available.
- Theft is offence involving moral turpitude and consequently the gratuity will be forfeited.
POWER TO EXEMPT
- 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.
COMPULSORY INSURANCE
- With effect from such date as may be notified by the appropriate Government in this behalf,
every 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.
- The appropriate government may 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 500 or more persons who establishes an approved
gratuity fund in the prescribed manner.
- For the purpose of effectively implementing the provisions of his section, every employer shall
within prescribed time may get his establishment registered with the contolling authority in the
prescribed manner.
NOMINATION
Form and time limit:
- Each employee, who has completed 1 year of service, shall make nomination in prescribed form
in duplicate within 90 days of completion of 1 year of service.
Distribution of gratuity
- An employee may in his nomination, distribute the amount of gratuity payable to him under this
Act amongst more than one nominee.
Nomination – if employee has a family
- 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.
Nomination – if employee has no family
- If at 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 90 days, a fresh
nomination in favour of one or more members of his family.
Modification in Nomination
- A nomination may 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.
Nominee predeceases the employee
- 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.
Safe custody of nomination
- Every nomination, fresh nomination or alteration of nomination, as the case may be, shall be
sent by the employee to his employer, who shall keep the same in his safe custody.
INSPECTORS AND THEIR POWERS

Inspectors:
- The appropriate Government may, by notification, appoint as many Inspectors, as it deems fit,
for the purposes of this Act.
- The appropriate Government may, by general or special order, define the area to which the
authority of an Inspector so appointed shall extend 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 the Act.
- Every Inspector shall be deemed to be a public servant within the meaning of Sec. 21 of the
Indian Penal Code, 1860 (Act 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 thereunder, 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 assistants (if any), being persons in the
service of the Government or local or any public authority,
(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.
(f) 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 AND PROTECTION OF GRATUITY

Application for payment of gratuity
- Recovery of Gratuity: A person who is eligible for payment of gratuity under the Act or any
person authorized, in writing, to act on his behalf shall send a written application to the
employer.
- Payment of Gratuity (Central) Rules 1972 provides that the application shall be made ordinary
within 30 days from the date gratuity becomes payable. The Rules also provide that where the
date of superannuation or retirement of an employee is known, the employee may apply to the
employer before 30 days of the date of superannuation or retirement.
- A nominee of an employee who is eligible for payment of grauituy in the case of death of the
employee shall apply to the employer ordinarily within 30 days of the gratuity becomes payable
to him (RULE 7(2)).
- It can be in any form on plain paper with relevant details of the employee.
- It can be given to the employer by personal service or be registered post with acknowledgement
due.
Employer’s duty to determine and pay gratuity
- As soon as gratuity becomes payable the employer shall, whether the application has been made
or not, determine the amount of gratuity and given notice in writing to the person to whom it is
payable and also to the Controlling Authority, specifying the amount of gratuity so determined.
Time limit to pay gratuity
- The employer shall arrange to pay the amount of gratuity within 30 days from the date of its
becoming payable to the person to whom it is payable.
- If it is not paid then pay with interest at rate of 10% p.a.
- No payable of interest if the delay is due to the fault of the employee and the employer has
obtained permission in writing from the Controlling Authority for the delayed payment on this
ground.
Recovery of gratuity:
- If the amount of gratuity payable is not paid by the employer, within the prescribed time, to the
person entitled thereto, then the aggrieved person can make an application to the controlling
authority who shall issue a certificate for that amount to the Collector.
- The Collector shall recover the same as arrears of land revenue and pay the same to the person
entitled along with compound interest at specified rates. It (interest) shall not exceed the amount
of gratuity.
- The controlling authority shall before issuing a certificate under this Act give the employer a
reasonable opportunity of showing cause against the issue of such certificate.
PENALTIES
- 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 6 months, or with fine which may extend to 10,000 rupees or with both.
- An employer who contravenes, or makes default in complying with, any of the provisions of
this Act or any rule or order made thereunder shall be punishable with imprisonment for a term
which shall not be less than 3 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, for a term which shall not
be less than 6 months but which may extend to 2 years unless the Court trying the offence, for
reasons to be recorded by it in writing, is of opinion that a 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 not less than three clear
days' notice in writing of his intention to do so, 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 proves 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,
COGNIZANCE OF OFFENCE-
- (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 authorise the controlling authority to make a
complaint against the employer, whereupon the controlling authority shall, within fifteen days
from the date of such authorisation, make such complaint to a Magistrate having jurisdiction to
try the offence.
- 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.
PROTECTION OF ACTION TAKEN IN GOOD FAITH

- 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 or order made thereunder.
PROTECTION OF GRATUITY
- No gratuity payable under this Act 2[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.
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
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 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 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.
PAYMENT OF WAGES ACT 1936

32. EXPLAIN THE FOLLOWING WITH THE REFERENCE TO PAYMENT OF WAGES
ACT 1936 – RESPONSIBILITY FOR PAYMENT OF WAGES. DEDUCTION FROM
WAGES.
DISCUSS IN BRIEF THE AUTHORIZED DEDUCTIONS UNDER THE PAYMENT OF
WAGES ACT, 1936.
- The payment of wages Act was enacted to regulate the payment of wages to certain class of
employed persons.
- It also ensures a speedy and effective remedy against unauthorized deductions and or unjustified
delay caused in paying wages.
- In order to bring uniformity with other laws and to make it more effective and practicable, the
Payment of Wages Act was amended in 2005.
APPLICATION:
- The Payment of Wages Act, 1936 extends to the whole of India.
- It came into operation on 21st March, 1937.
- According to sub-section (4) this Act applies in the first instance to the payment of wages to :
a. persons employed in any factory;
b. persons employed (otherwise than in factory) upon any railway by a railway administration,
or either directly or, through a sub-contractor, by a person fulfilling a contract with a railway
administration; and
c. persons employed in an industrial or other establishment specified in sub-clauses (a) to (g) of
clause (ii) of Section 2 of this Act.
- Sub-section (5) empowers the State Government to extend the application of the whole or part
of the Act to payment of wages to any class of persons employed in the establishment or class of
establishments specified by the Central Government or a State Government under sub-clause (h)
of clause (ii) of Section 2. Section 2(vi). Has to give three months’ notice to extend it.
- It does not apply to wages payable of a wage-period which is more than 18000 a month
(notification no. 2260(E) dated 11.9.2012).
DEFINITIONS
- “Employed person” includes the legal representative of a deceased employed person;
- “Employer” includes the legal representative of a deceased employer;
- “Factory” means a factory as defined in section 2 (m) of the Factories Act, 1948 (63 of 1948)
and includes any place to which the provisions of that Act have been applied under sub-section
85 (1) thereof;]
Industrial or other establishment means any:
a. tramway service, or motor transport service engaged in carrying passengers or goods or both
by road for hire or reward;
b. air transport service other than such service belonging to or exclusively employed in the
military, naval or air forces of the Union or the Civil Aviation Department of the
Government of India;
c. dock, wharf or jetty
d. inland vessel, mechanically propelled
e. mine, quarry or oil-field;
f. plantation;
g. workshop or other establishment in which articles are produced, adapted or manufactured,
with a view to their use, transport or sale;
h. establishment, in which any work relating to the construction, development or maintenance
of buildings, roads, bridges or canals, or relating to operations connected with navigation,
irrigation or the supply of water, or relating to the generation, transmission and distribution
of electricity or any other form of power is being carried on.
- Wages: 'Wages' means all remuneration, whether by way of salaries, allowances or otherwise,
expressed in terms of money or capable of being so expressed which would, if the terms of
employment, express or implied were fulfilled, be payable to a person employed in respect of
his employment or of work done in such employment.
- 'Wages' includes
 any remuneration payable under any award or settlement between the parties or order of a
Court;
 any remuneration to which the person employed is entitled in respect of overtime work or
holidays or any leave period;
 any additional remuneration payable under the terms of employment whether called a bonus
or by any other name.
 termination remuneration
 any sum under any shceme framed under any law for the time being in force.
Wages does not include:
 bonus (whether under a scheme of profit sharing or otherwise) which does not form part of
the remuneration payable under the terms of employment or which is not payable under any
award or settlement between the parties or order of a Court;
 the value of any house-accommodation, or of the supply of light, water, medical attendance
or other amenity
 any contribution paid by the employer to any pension or provident fund, and the interest
which may have accrued thereon;
 any travelling allowance or the value of any travelling concession;
 any sum paid to the employed person to defray special expenses entailed on him by the
nature of his employment; or
 any gratuity payable on the termination of employment in cases other than those specified in
sub-clause (d)]
AUTHORITIES UNDER THE ACT:
- Section 14. Inspectors : Section 14 of the Act makes provision for three kinds of Inspectors
which are as follows–
1. An Inspector of factories appointed under Section 8(1) of the Factories Act shall be an
Inspector for the purposes of this Act in respect of all factories within the local limits
assigned to him.
2. In respect of all persons employed upon a railway otherwise than in a factory, to whom this
Act applies, the State Government is empowered to appoint Inspector for the purposes of this
Act.
3. The State Government is further empowered to appoint such other persons, as it thinks fit, as
Inspectors for the purposes of this Act in respect of persons employed in case of factories
and industrial or other establishment as specified by such Government by a Gazette
notification. The State Government shall also define the local limits within which such
inspectors shall exercise their functions.
Powers of the Inspectors: Section 14(4) lays down that an Inspector may–
a. make such examination and inquiry as he thinks fit in order to ascertain whether the
provisions of this Act or rules made there under are being observed;
b. enter, inspect and search any premises of any railway, factory or industrial or other
establishment at any reasonable time for the purposes of carrying out the objects of this Act.
They have power to take any assistance which they think necessary for any of the above
purposes;
c. supervise the payment of wages to persons employed upon any railway or in any factory or
industrial or other establishment;
d. require by a written order the production at such place, as may be prescribed, of any register
or record maintained in pursuance of this Act. He can also take on the spot or otherwise
statement of any persons which he considers necessary for carrying out the purposes of this
Act;
e. seize or take copies of such registers or documents or portions thereof as he may consider
relevant in respect ,of an offence under this Act which he has reason to believe has been
committed by an employer; and
f. exercise such other powers as may be prescribed. But according to sub-section (4) of
Section 14 no person shall be compelled to answer any question or make any statement
tending to incriminate himself. The provisions of the Code of Criminal Procedure, 1973
shall, so far as may be, apply to any search or seizure under this sub-section. As they apply
to any search or seizure made under the authority or a warrant issued under Section 94 of the
said Code. Every' Inspector shall be deemed to be public servant within the meaning of the
Indian Penal Code 1860. The State Government is further empowered to appoint more than
one authority for the same specified area, and where it so appoints it shall, by general or
special order, provide for the distribution or allocation of work to be performed by them
under this Act.
RESPONSIBILITY FOR PAYMENT OF WAGES

- Every employer shall be responsible for the payment of all wages required to be paid under this
Act to persons employed by him and in case of persons employed,--
(a) in factories, if a person has been named as the manager of the factory under the Factories
(b) in industrial or other establishments, if there is a person responsible to the employer for
the supervision and control of the industrial or other establishments;
(c) railways (otherwise than in factories) if the employer is the railway administration and the
railway administration has nominated a person in this behalf for the local area concerned.
(d) in the case of contractor, a person designated by such contractor who is directly under his
charge; and
(e) in any other case, a person designated by the employer, the person so nominated or the
person so designated, as the case may be, shall be responsible for such payment. The
person so named, and the person so responsible to the employer, or the person so
nominated, as the case may be, shall also be responsible for such payment.
FIXATION OF WAGE PERIOD:

- Every person responsible for the payment of wages under Section 3 shall fix periods (in this Act
referred to as wage-periods) in respect of which such wages shall be payable.
- No wage-period shall exceed one month.
- It means that wages can be paid daily, weekly, fortnightly or monthly basis but wage period
cannot be more than one month.
TIME PERIOD OF PAYMENT OF WAGES:

- The wages of every person employed upon or in –
(a) any railway, factory or industrial or other establishment upon or in which less than 1000
persons are employed, shall be paid before the expiry of the 7th day
(b) any other railway, factory or industrial or other establishment, shall be paid before the
expiry of the 10th day, after the last day of the wage-period in respect of which the wages
are payable.
- Where the employment of any person is terminated, the wages shall be paid before the expiry of
the 2nd working day from the termination of employment.
- All payments of wages shall be made on a working day.
MODE OF PAYMENT OF WAGE:

- All wages shall be paid in current coin or currency notes or in both. The employer may, after
obtaining the written authorization of the employed person, pay him the wages either by cheque
or by crediting the wages in his bank account.
DEDUCTION FROM WAGES:

- The wages of the employed person shall be paid to him without deductions of any kind except
those authorized by or under the Act.
Explanation I: Every payment made by the employed person to the employer or his agent shall,
for the purposes of this Act, be deemed to be a deduction from wages.
Explanation II: Any loss of wages resulting from the imposition, for good and sufficient cause,
upon a person employed of any of the following penalties, shall not be deemed to be deduction
from wages namely:
1. the withholding of increment or promotion (including the stoppage of increment at an
efficiency bar);
2. the reduction to a lower post or time-scale or to a lower stage in a time-scale; or
3. suspension;
Permissible deductions
- Deductions from the wages of an employed person shall be made only in accordance with the
provisions of this Act, and may be of the following kinds only, namely:
1. fines;
2. deduction for absence from duty;
3. deductions for damage to or loss of goods expressly entrusted to the employed person or
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;
4. deductions for house-accommodation supplied by the employer or by Government or any
housing board
5. deductions for such amenities and services supplied by the employer
6. deductions for recovery of advances of whatever nature (including advances for travelling
allowance or conveyance allowance), and the interest due in respect thereof, or for
adjustment of over-payments of wages.
7. deductions for recovery of loans made from any fund constituted for the welfare of labour
in accordance with the rules approved by the State Government, and the interest due in
respect thereof;
8. deductions for recovery of loans granted for house-building or other purposes approved by
the State Government and the interest due in respect thereof;
9. deductions of income-tax payable by the employed person;
10. deductions required to be made by order of a Court or other authority competent to make
such order;
11. deductions for subscriptions to, and for payment of advances from any provident fund to
which the Provident Funds Act, 1925 (19 of 1925),
12. deductions for payments to co-operative societies approved by the appropriate
Government] 5[or any officer specified by it in this behalf or to a scheme of insurance
maintained by the Indian Post Office;
13. deductions, made with the written authorisation of the person employed for payment of any
premium on his life insurance policy to the Life Insurance Corporation of India established
under the Life Insurance Corporation Act, 1956 (31 of 1956),
14. deductions made, with the written authorisation of the employed person, for the payment of
his contribution to any fund constituted by the employer or a trade union registered under
the Trade Unions Act, 1926 (16 of 1926) for the welfare of the employed persons or the
members of their families, or both, and approved by 10[the appropriate Government.
15. deductions for payment of insurance premia on Fidelity Guarantee Bonds;
16. deductions for recovery of losses sustained by a railway administration on account of
acceptance by the employed person of counterfeit or base coins or mutilated or forged
currency notes;
17. deductions for recovery of losses sustained by a railway administration on account of the
failure of the employed person to invoice, to bill, to collect or to account for the appropriate
charges due to that administration, whether in respect of fares, freight, demurrage,
wharfage and cranage or in respect of sale of food in catering establishments or in respect
of commodities in grain shops or otherwise;
18. deductions for recovery of losses sustained by a railway administration on account of any
rebates or refunds incorrectly granted by the employed person where such loss is directly
attributable to his neglect or default
19. deductions, made with the written authorisation of the employed person, for contribution to
the Prime Minister's National Relief Fund or to such other Fund as the Central Government
may, by notification in the Official Gazette, specify.
20. deductions for contributions to any insurance scheme framed by the Central Government
for the benefit of its employees.
Maximum deductions
- The total amount of deductions which may be made under sub-section (2) in any wage-
period from the wages of any employed person shall not exceed-
(i) in cases where such deductions are wholly or partly made for payments to co-
operative societies under clause (j) of sub-section (2), 75% of such wages, and
(ii) in any other case, 50% of such wages:
Provided that where the total deductions authorised under sub-section exceed seventy-five
per cent or, as the case may be, fifty per cent of the wages, the excess may be recovered in
such manner as may be prescribed.
FINES:
- No fine shall be imposed on any employed person save in respect of such acts and omissions on
his part as the employer with the previous approval of the appropriate Government or of the
prescribed authority, may have specified by notice under sub-section (2).
- A notice specifying such acts and omissions shall be exhibited in the prescribed manner on the
premises in which the employment is carried on or in the case of persons employed upon a
railway (otherwise than in a factory), at the prescribed place or places.
- No fine shall be imposed on any employed person until he has been given an opportunity of
showing cause against the fine, or otherwise than in accordance with such procedure as may be
prescribed for the imposition of fines.
- The total amount of fine which may be imposed in any one wage- period on any employed
person shall not exceed an amount equal to three percent of the wages payable to him in respect
of that wage-period.
- No fine shall be imposed on any employed person who is under the age of fifteen years.
- No fine imposed on any employed person shall be recovered from him by installments or after
the expiry of ninety days from the day on which it was imposed.
- Every fine shall be deemed to have been imposed on the day of the act or omission in respect of
which it was imposed.
- All fines and all realizations thereof shall be recorded in a register to be kept by the person
responsible for the payment of wages under Section 3 in such form as may be prescribed; and
all such realizations shall be applied only to such purposes beneficial to the persons employed in
the factory or establishment as approved by the prescribed authority.
DEDUCTIONS FROM WAGES FOR ABSENCE FROM DUTY:

- Deductions may be made on account of the absence of an employed person from the place or
places where, by the terms of his employment, he is required to work, such absence being for
the whole or any part of the period during which he is so required to work.
- The amount shall be deducted only for period of absence from duty.
- If 10 or more employed persons actions in concert without due notice and without reasonable
cause, then deduction up to 8 days wages can be made.
An employer shall be deemed to be absent from the place where he is required to work, if,
although present, he refuses to, in pursuance of a stay-in-strike or for any other cause which is
not reasonable in the circumstances, to carry out his work.
DEDUCTION FOR DAMAGE OR LOSS:

- A deduction for causing damage or loss to employer shall not exceed the amount of the damage
or loss caused to the employer by the neglect or default of the employed person.
- The employer is required to give an opportunity of showing cause against the deduction in
accordance with prescribed procedure before deducting any amount payable to employee.
DEDUCTIONS FOR RECOVERY OF ADVANCES
- Deductions for recovery of loans granted shall be subject to the following conditions, namely:
a. An advance of money given before employment starts shall be made from the first wages of
a complete wage period. However, no recovery shall be made of such advances given for
travelling expenses.
b. Recovery of an advance or money given after employment starts shall be subject to
conditions imposed by the Appropriate Government.
c. Recovery of advances of wages not already earned shall be subject to rules made by the
Appropriate government, such rules may regulate the extent to which such advances may be
given and the installments by which they may be recovered.
MAINTENANCE OF REGISTERS AND RECORDS.

- Every employer shall maintain such registers and records giving such particulars of:
 persons employed by him,
 the work performed by them,
 the wages paid to them,
 the deductions made from their wages,
 the receipts given by them and
 such other particulars and in such form as may be prescribed.
- Every register and record required to be maintained under this section shall, for the purposes of
this Act, be preserved for a period of 3 years after the date of the last entry made therein].
CLAIMS:
- Claims arising out of deductions from wages or delay in payment of wages and penalty for
malicious or vexatious claims. The appropriate Government, may, by notification in the Official
Gazette, appoint:
1. any Commissioner for Workmen's Compensation; or
2. any officer of the Central Government exercising functions as,— (i) Regional Labour
Commissioner; or (ii) Assistant Labour Commissioner with at least two years‟ experience; or
3. any officer of the State Government not below the rank of Assistant Labour Commissioner
with at least two years’ experience; or
4. a presiding officer of any Labour Court or Industrial Tribunal, constituted under the
Industrial Disputes Act, 1947 (14 of 1947) or under any corresponding law relating to the
investigation and settlement of industrial disputes in force in the State; or
5. any other officer with experience as a Judge of a Civil Court or a Judicial Magistrate, as the
authority to hear and decide for any specified area all claims arising out of deductions from
the wages, or delay in payment of the wages of persons employed or paid in that area,
including all matters incidental to such claims.
APPLICATION SEEKING RELIEF AGAINST UNAUTHORIZED DEDUCTIONS FROM

WAGES
- An Application for claims arising under the Act can be made by following persons
a. Employee himself
b. Any legal practitioner.
c. Any official of a registered trade union authorized in writing.
d. Any inspector under this Act
e. Any other person acting with the permission of the authority appointed u/s 1115(1).
- Time limit for making application: every application shall be presented within 12 months
from the date on which the deduction from the wages was made or from the date on which the
payment of wages was due to be made as the case may be.
Procedure for determining claims arising out of deductions from wages

- When any application for claims is made under the Act the authority shall hear the applicant,
employer or person responsible for the payment of wages.
- After inquiry the authority can direct the refund of the amount deducted, or the payment of the
delayed wages together with compensation not exceeding 10 times the amount deducted.
- In case of delayed payments maximum compensation can be 3000 but not less than 1,500.
- Even where the deducted or delayed wages are paid before the disposal of the application, the
authority may direct the payment of compensation but not exceeding Rs. 2000.
- The claim has to be disposed in 3 months’ time. It can be extended if both parties to the dispute
agree.
PENALTY FOR MAKING MALICIOUS OR VEXATION CLAIMS

- If the authority hearing an application is satisfied that the application was either malicious or
vexatious, the authority may direct a penalty not exceeding Rs. 375 be paid to the employer or
person responsible for the payment of wages by the person presenting the application.
PENALTY FOR MAKING MALICIOUS OR VEXATION CLAIMS

- Penalty for offences under the Act.
1. Whoever being responsible for the payment of wages to an employed person contravenes
any of the provisions of any of the following sections, namely, Section 5 except sub-section
(4) thereof, Section 7, Section 8 except sub-section (8) thereof, Section 9, Section 10, except
sub-section (2) thereof, and Sections 11 to 13, both inclusive, shall be punishable with fine
which shall not be less than one thousand five hundred rupees but which may extend to
seven thousand five hundred rupees.
2. Whoever contravenes the provisions of Section 4, [sub-section (4) of Section 5, Section 6,
sub- section (8) of Section 8, sub-section (2) of Section (10)] or Section 25 shall be
punishable with fine which may extend to 3750 rupees.
3. Whoever being required to nominate or designate a person under section 3 fails to do so,
such person shall be punishable with fine which may extend to 3000 rupees.
4. Whoever being required under this Act to maintain any records or registers or to furnish any
information or return,-
(a) fails to maintain such register or record; or
(b) willfully refuses or without lawful excuse neglects to furnish such information or return;
or
(c) willfully furnishes or causes to be furnished any information or return which he knows
to be false; or
(d) refuses to answer or willfully gives a false answer to any question necessary for
obtaining any information required to be furnished under this Act,
shall for each such offence, be punishable with fine which shall not be less than 1500 rupees
but which may extend to 7500 rupees.
5. Whoever-
(e) willfully obstructs an Inspector in the discharge of his duties under this Act; or
(f) refuses or willfully neglects to afford an Inspector any reasonable facility for making
any entry, inspection, examination, supervision or (inquiry authorized by or under this
Act in relation to any railway, factory or 3[industrial or other establishment]; or
(g) willfully refuses to produce on the demand of an Inspector any register or other
document kept in pursuance of this Act; or
(h) prevents or attempts to prevent or does anything which he has any reason to 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 fine which shall not be less than 1500 rupees but which may extend
to 7500 rupees.
6. If any person who has been convicted of any offence punishable under this Act is again
guilty of an offence involving contravention of the same provision, he shall be punishable on
a subsequent conviction with imprisonment for a term which shall not be less than 1 month
but which may extend to 6 months and with fine which shall not be less than 3750 rupees but
which may extend to 20,500 rupees or with both: Provided that for the purpose of this sub-
section, no cognizance shall be taken of any conviction made more than two years before the
date on which the commission of the offence which is being punished came to the
knowledge of the Inspector.
7. If any person fails or willfully neglects to pay the wages of any employed person by the date
fixed by the authority in this behalf, he shall, without prejudice to any other action that may
be taken against him, be punishable with an additional fine which may extend to 750 Rs. for
each day for which such failure or neglect continues.

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LABOUR LAW II (EXTERNAL)

2. EXPLAIN DUTIES OF THE OCCUPIER WITH REFERENCE TO FACTORIES ACT

The occupier shall also perform these duties such as:

3. EXPLAIN POWER OF INSPECTING STAFF WITH REFERENCE TO FACTORIES ACT

 Powers of the Inspecting Staff? Section 9

 Appointment of welfare and safety officer.

4. EXPLAIN THE PROVISIONS OF SAFETY WITH REFERENCE TO FACTORIES ACT

b. Working on or near Machinery in Motion.

5. EXPLAIN HAZARDOUS PROCESS AND DISCUSS THE PROVISIONS RELATING TO

 Provisions relating to hazardous processes are:

a. Constitution of Site Appraisal Committees.

6. DISCUSS CERTIFYING SURGEONS.

7. DISCUSS PROVISIONS REGARDING WELFARE.

 Intervals for rest.

 Exemption of working hours under section 64.

B. Working hours for women

9. DISCUSS PROVISIONS AS REGARDS EMPLOYMENT OF YOUNG PERSON AND

a. Prohibition of employment of young children (section 67)

10. DISCUSS ANNUAL LEAVE WITH WAGES.

11. EXPLAIN PENALTIES AND PROCEDURE UNDER FACTORIES ACT, 1948

12. DISCUSS THE SALIENT FEATURES OF THE EMPLOYEES COMPENSATION ACT,

13. EXPLAIN WHO IS AN EMPLOYEE, DEPENDENT AND EMPLOYER IN EMPLOYEES

14. EXPLAIN EMPLOYER’S LIABILITY TO PAY COMPENSATION WITH REFERENCE

EMPLOYER’S LIABILITY FOR COMPENSATION - Section 3(1).

Employer’s liability to pay compensation in case of occupational diseases

Employer not bound to give compensation if

15. EXPLAIN TOTAL DISABLEMENT AND PARTIAL DISABLEMENT WITH

16. EXPLAIN THE METHOD OF CALCULATION OF WAGES AND FATAL ACCIDENT

METHOD OF CALCULATING WAGES.

17. DISCUSS AMOUNT OF COMPENSATION UNDER THE EMPLOYEES

NOTICE AND CLAIMS OF THE ACCIDENT

19. DISCUSS THE APPOINTMENT OF COMMISSIONERS AND THEIR POWER AND

VENUE OF PROCEDINGS AND TRANSFER.

POWER OF COMMISSIONER TO REQUIRE FURTHER DEPOSIT IN CASES OF

POWERS AND PROCEDURE OF COMMISSIONERS.

POWER TO SUBMIT CASES.

20. SALIENT FEATURES OF THE MATERNITY BENEFIT ACT, 1961

c. Employment of women prohibited during certain periods:

d. Right to payment of maternity benefit/ persons entitled to maternity benefit:

e. Continuance of payment of maternity benefit:

g. Payment of maternity benefit in case of death of a woman:

h. Payment of medical bonus:

i. Leave for miscarriage:

l. Notice of claim for maternity benefit and payment thereof:

m. Dismissal during absence of pregnancy:

n. No deduction in wages in certain cases:

o. Forfeiture of maternity benefits:

q. Penalty for contravention of Act by employer:

22. DISCUSS CONTRACT, NOVATION, PERIOD AND TERMINATION OF APPRENTICE

TERMINATION OF APPRENTICESHIP CONTRACT -

23. DISCUSS OBLIGATIONS OF EMPLOYERS, OBLIGATIONS OF APPRENTICE UNDER

Obligation of payment by employer

Obligation to health, safety and welfare of apprentice

24. DISCUSS PRACTICAL AND BASIC TRAINING AND RELATED INSTRUCTIONS OF

RELATED INSTRUCTION OF APPRENTICES-

25. DISCUSS AUTHORITIES AND PENALTIES UNDER APPRENTICE ACT.

Central Apprenticeship Council

State Apprenticeship Council

Vacancies not to invalidate acts and proceedings

Deputy and Assistant Apprenticeship Advisers

Apprenticeship Advisers to be public servants

Powers of entry, Inspection, etc.

Offences and penalties