1628151647792industrial Relations and Labour Law

FOR UPSC EPFO EXAM
TABLE OF CONTENT
1. Industrial Relation: Definitions, Scope, Objectives, Types &
Characteristics
2. Approaches to Industrial Relations – Theoretical Approaches
to Industrial Relations by Different Scholars
3. Evolution of Industrial Relation
4. Constitutional Provisions in Industrial Relations
5. Code on Wages
6. Industrial Relations Code, 2020
7. Occupational Safety, Health & Working Conditions Code, 2020
8. Code on Social Security, 2020
ORGANISATION
Organisation consists of group of people coming together to achieve common

objective through coordinated action.
In any business organisation, capitalist(owner/management) wants to maximize
profits while workers want to maximize their wages. An increase in wages of workers
would lead to reduction of profit for the owner. This could become a reason of conflict
between the two.
Also, other causes of conflict could be- high working hours, poor conditions of work,
participation in management etc.
For efficient functioning of organisation, it is important to maintain cordial relations.
Hence, study of industrial relations becomes utmost important. It seeks to ensure
betterment of both- workers as well as owner/management.
INDUSTRIAL RELATIONS
Industrial relations consist of all the relations and interactions in the industry particularly
between the labour and management. These relations and interactions are result of their
composite attitudes and approaches regarding the management of the affairs of the
industry. Good industrial relations lead to increased productivity, labour peace, maximising
social welfare, industrial and economic development, and industrial democracy.
Industries having poor industrial relations face increased labour turnover and
absenteeism, growing indiscipline, strike and walkouts, deterioration of quality of
goods and strained labour- management relations.
Industrial Relation: Definitions, Scope, Objectives, Types & Characteristics
According to V. Agnihotri, “The term industrial relations explains the relationship

between employees and management which stem directly or indirectly from union-
employer relationship.”
This definition takes a narrower view of industrial relations and is concerned with
only management and employees. However, Industrial relations are affected by other
factors as well e.g., governmental policies, economic structure etc.
A wider definition is given by T.N. Kapoor - “The term ‘Industrial Relations’ should be
understood in the sense of labour- management relations as it percolates into a wider
set of relationship touching extensively all aspects of labour such as union-policies,
personnel policies and practices including wages, welfare and social security, service
conditions, supervision and communication, collective bargaining etc., attitudes of
parties and governmental action on labour matter.”
Page | 1
/examquest @examquest247
1. Two parties—employer and workmen are necessary without which such
relationship cannot exist. Industry provides the setting for industrial relations.
2. Industrial relation is affected by diverse and complex attitudes and approaches
of both management and workers in connection with the management of the
industry.
3. It involves the process of accommodation whereby both the parties develop
skills and methods of adjusting to and cooperating with each other.
4. It depends on a number of factors like historical, economic social, psychological,
demographic, technological, occupational, legal and others etc.
5. Every industrial relation creates a complex of rules and regulations to govern
the work-place, the work- community with the main purpose of maintaining
harmonious relations between the management and the workmen by solving
their problems through the process of collective bargaining.
6. The Government/State also regulates the industrial relations in the country.
Industrial Relations – Scope

Industrial relation is continuous relationship. Its scope includes:
(a) Relationship among employees, between employees and their superiors or
managers.
(b) Collective relations between trade unions and management. It is called union-
management relations.
(c) Collective relations among trade unions, employers’ associations and government.
Parties involved in Industrial relations.

S.No. Parties Role/ expectations
1. Employees Sharing view, redressal of grievances,
Participation in management.
2. Employers Increased efficiency, reduction in conflict etc.
3. Government Parties involved adhere to laws, increased
economic activity.
4. Employers’ Representing the owners in collective bargaining
Association with the employees or government and in case of
national issues; creating mechanism to resolve
industrial disputes;
providing suggestions accordingly
5. Trade Unions Safeguarding interest of employees.
6. Courts and To resolve conflicts
Tribunals
Page | 2
7. International players like ILO also work to ensure harmonious
relation in industry and to safeguard interest of workers
Factors affecting Industrial relations are: -
1. Institutional Factors: Under institutional factors are included items like state
policy, labour laws, voluntary codes, collective bargaining agreements, labour
unions, employers’ organisations / federations etc.
2. Economic Factors: Under economic factors are included economic

organisations, (socialist, communist, capitalist) type of ownership, individual,
company — whether domestic or MNC, Government, cooperative ownership)
nature and composition of the workforce, the source of labour supply, labour
market relative status, disparity of wages between groups, level of
unemployment, economic cycle.
3. Social Factors: Under social factors items like social group (like caste or joint
family) creed, social values, norms, social status (high or low) — influenced
industrial relations in the early stages of industrialisation. They gave rise to
relationship as master and servant, haves and have-nots, high caste and low
caste, etc. But with the acceleration of industrialisation, these factors gradually
lost their force but one cannot overlook their importance.
4. Technological Factors: Under technological factors fall items like work

methods, type of technology used, rate of technological change, R&D activities,
ability to cope with emerging trends, etc. These factors considerably influence
the patterns of industrial relations, as they are known to have direct influence
on employment status, wage level, collective bargaining process in an
organisation.
5. Psychological Factors: Under psychological factors fall items pertaining to

industrial relations like owners’ attitude, perception of workforce, workers’
attitude towards work, their motivation, morale, interest, alienation;
dissatisfaction and boredom resulting from man-machine interface. The
various psychological problems resulting from work have a far-reaching impact
on workers’ job and personal life, that directly or indirectly influences industrial
relation system of an enterprise.
6. Political Factors: The political factors are political institutions, system of

government, political philosophy, attitude of government, ruling elite and
opposition towards labour problems. For instance, the various communist
countries prior to the adoption of new political philosophy, the industrial
Page | 3
relations environment was very much controlled by the Government ever since
change has altered considerably like other capitalist economics.
7. Most of the trade unions are controlled by political parties, so here the
industrial relations are largely shaped by the gravity of involvement of political
parties in trade union activities.
8. Political Parties: Political parties influence government to formulate labour

policies, to enact laws, to issue instructions, orders to industrial organizations
on different aspects. They also dominate trade union people and rank and file
to behave and manifest activities in a way they desire. In the process, labour-
management interaction is controlled by political parties and whole industrial
pattern is influenced.
9. Enterprise-Related Factors: It includes issues like style of management

prevailing in the enterprise, its philosophy and value system, organisational
climate, organisational health, extent of competition, adaptability to change
and the various human resources management policies.
10. Global Factors: Under global factors, the various issues included are
international relations, global conflicts, dominant economic-political
ideologies, global cultural milieu, economic and trading policies of power
blocks, international trade agreements and relations, international labour
agreements (role of ILO) etc.
11. International Relations: Good relations between countries facilitate movement

of men and material and also provides market. Relations between nations also
determine the working conditions of employees e.g. resolving visa issue with
USA would enable more professionals to move there, in Gulf countries, working
conditions are not too good. And India could exert pressure to ensure good
working conditions for them
Approaches to Industrial Relations – Theoretical Approaches to Industrial

Relations by Different Scholars
1. Unitary approach
2. Pluralist approach
3. Marxist approach
4. The System Approach
Page | 4
5. Oxford Approach
6. The Industrial Sociology Approach
7. The Social Action Model
8. The Psychological Approach
9. Human Relation Approach
10. Giri’s Approach
11. The Gandhian Approach
Unitary Approach
This approach views organisation as one happy family where conflicts are temporary
aberrations because of problems in management. With cooperation every one-
employee, employer or government- benefits i.e. under this approach, the foundation
of IR rests on mutual cooperation, team work, shared goal, and so on.
Unitarism has a paternalistic approach where it demands loyalty of all employees.
Trade unions are deemed as unnecessary and conflict is perceived as disruptive. If
TUs are recognised, their role is to ensure proper communication. Staffing policies
should try to unify effort, inspire and motivate employees.
Pluralistic Approach
Organization is composed of individuals who form distinct groups with their own set
of aims, objectives, leadership styles, and value propositions. It considered conflict as
inevitable and rational. The role of management would lean less towards enforcing
and controlling and more toward persuasion and co-ordination. Trade unions are
deemed as legitimate representatives of employees. Trade unions represent interest
of workers that is why employees join trade union.
Therefore, a strong union is not only desirable but necessary. And legislations and
tribunals help to protect society’s interest.
Marxist Approach
It views capitalism as source of conflict. Like Pluralists, Marxists also view conflict
between labour and management as inevitable. Conflict arises because of division
within the society in terms of the ‘haves’ i.e., capitalists and the ‘have not’s i.e., labour.
Capitalists want profits by paying minimum wages to labour.
Page | 5
The Marxists believe that state supports management’s interest. They debate that the
pluralistic approach is supportive of capitalism and the unitary approach is looked
upon as an anathema. Hence, the labour-capital conflict, according to this approach,
cannot be solved by bargaining, participation and cooperation.
The role of trade union is seen as a reaction to exploitation by capitalists along with
being a weapon to bring a revolutionary social change by changing capitalistic
system. So as to serve this purpose, coercive powers such as strikes, gherao, etc. are
exercised by the labour against capitalists.
The System Approach
Industrial relations system is a sub-system of the wider society or the total social
system. It is a mixture of traditions, customs, actions, reactions and interactions
between the parties. It may be conceived at different levels- workplace, industrial,
regional or national. It is the totality of power interactions of participant’s
management and trade union at a workplace.
According to Prof. J. P. Dunlop, “An industrial relations framework is designed to be

applicable at once to three broad areas of industrial relations experience, namely-(i)
industrial relations within an enterprise, industry or other segment of a country and
a comparison among such sectors; (ii) industrial relations within a country as whole
and a comparison among countries, and (iii) industrial relations as a totality in the
course of economic development.”
Oxford Approach = study of job regulations
Flanders is the exponent of this approach. Job regulation can be categorised as

internal and external. Internal regulation being code of work rules, internal
procedure of joint consultations, wage structure, grievance handling etc. Trade
unions were considered as external regulation.
The actors in the system are the managers, the workers and their representatives,
and the government agencies. The rules in the system are classified into two
categories:
a. The substantive rules determine the conditions under which people are employed
b. The procedural rules govern how substantive rules are to be made and
understood. Ultimately, the introduction of new rules and regulations and
revisions of the existing rules for improving the industrial relations are the major
outputs of the industrial relations system.
Page | 6
Collective bargaining leads to rule-making for industrial relations. Collective
bargaining is considered as a political institution involving power relationships
between the employer and the employees.
The Industrial Sociology Approach
According to G. Margerison, the core of industrial relations is the nature and

development of the conflict itself. Conflict can be
i. at intra-plant level: 3 types distributive, structural and human relations- Causes:
job contentment, work task and technology and
ii. the other outside the firm: main concern is with the conflicts not resolved at intra-
organisational level.
An industry consists of a group of employees coming from different caste, colour,
culture and family backgrounds having different attributes, such as – personality,
educational background, emotions, sentiments, likes dislikes, ideologies, attitudes
and behaviour. This can cause conflict and competition. The concept of inter-personal
and inter-group relations posing problems of industrial relations.
Social factors like workers attitude, perceptions of the society, value system, customs,
traditions, status symbols, urbnisation, gambling, drinking, acceptance or resistance
to change and one’s degree of tolerance have got a direct impact on industrial
relations.
The Social Action Model
Origin in Weberian sociology: This approach attempts to study the behavioural

influences. Behaviour and interactions leads to new values. Industrial peace might
prevent strikes but internal tensions might be there.
The Psychological Approach= problem due to perceptions of management, unions

and workers
Mason Haire gave this approach. Perceptions could be about the person, the situation
or the issues involved in the conflict. The perceptions of management and the trade
union may differ. Satisfaction depends upon many factors like the nature of his work,
his attitude towards work, working conditions, wages, job security relationship with
the union and the co-workers and the behaviour of the boss etc.
The quality of Industrial Relations as per psychologists, depends upon the
perceptions, attitudes and philosophy of the management and trade unions.
Human Relation Approach (Keith Davis)
Page | 7
The most important part of any organization is human being. They should not be
treated as cogs in a machine. There are broadly two types of human needs:
c. Economic Needs – Which include basic needs for food, shelter and
clothing for oneself and his dependent. These needs can be satisfied by
increasing his wages.
d. Psychological Needs – Needs for security from life hazards and

uncertainties created by new challenges and new relationships. These
are deep rooted and psychological in nature which disturb an employee’s
peace of mind.
The human relations approach highlights need to improve the morale, efficiency and
job satisfaction of employees. Human relations approach has its origin in the
Hawthorne experiments and the research of Elton Mayo. According to him, industrial
conflicts are due to inadequate communications and lack of understanding of inter-
personal factors like personality differences and irrational behaviour.
An informal social climate should be created to provide workers with outlets for their
emotions and sentiments.
Giri’s Approach
Mr. V.V. Girl was strong supporter of collective bargaining and mutual negotiations
for the settlement of industrial disputes. He advocated for bipartite machinery to
settle disputes. Government should actively encourage but outside interference
should not encroach industrial peace.
He was of this opinion, “Voluntary efforts on the part of management and the trade
union for winding up their differences is a tonic to the industry and any compulsion
from outside is bitter medicine.”
This approach gave emphasis that internal settlement should be preferred and
compulsory adjudication should be taken up as the last resort and only in exceptional
circumstances.
The Gandhian Approach
Gandhiji advocated peaceful co-existence of capital and labour. He believed in trust,

non-violence and non-possession. He had immense faith in the goodness of man and
believed that many of the evils of the modern world have been brought about by
wrong systems and not by wrong individuals. He insisted on recognising each
individual worker as human being. Labour-management relations can be either a
Page | 8
powerful stimulus to economic and social progress or an important factor in
economic and social stagnation.
Gandhiji advocated:
a. Workers should seek redressal of reasonable demands only through

collective bargaining.
b. Workers should avoid strikes, as far as possible, in industries of essential
services.
c. Strikes to be avoided and only resorted to as last measure, only non-violent
methods should be used.
d. Workers should take recourse to voluntary arbitration where direct
settlement fails.
e. Trade unions should seek authority from all workers before organising a
strike and remain peaceful and nonviolent during strikes.
f. Formation of trade unions should be avoided in philanthropical
organisations
He pleaded mutual respect, recognition of equality and strong labour unions as the
pre-requisites for healthy industrial relations.
EVOLUTION OF INDUSTRIAL RELATION (IR)
1. With changing socio-economic context, IR also changes. At global level, Initial

efforts at labour protection and reform were made after World War – 1.
International Labour Organisation (ILO) was established. It was an agency of
the League of Nations following the Treaty of Versailles, which ended World
War I.
2. In 1918, Whitley commission was formed in Great Britain, as a subcommittee of
the Reconstruction Commission. It recommended establishment of "industrial
councils" throughout the world.
Pre-Independence Era:
Colonial regime shaped industrial relations during this period and union movement
was considered an important part of the independence movement.
But progress was slow due to colonial rule, outside political leadership, ambivalence
of native capital. Also factors like the ideology of Gandhian class harmony, late entry
of leftists and the bourgeois character of congress also weakened IR.
Important events:-
Page | 9
1875: S.S. Bengali organised the first labour agitation to improve the conditions of
worker in Bombay.
1881: Factories act was passed
1891: Second Factory Act was passed.
Imp commissions:
1884: Bombay factory commission
1885: First Factory commission (Bombay factory Commission).
1890: Factory Labour Commission.
1911: Third Factory Act.
Narayan-Meghji Lokhande: Established Bombay Mill Hands Association in 1890
Helped in publication of labour magazine named Deenbandhu.
1897: the Amalgama Society of Railway Servants of India was established and
registered under the Companies Act
1907: Printers’ Union Calcutta (1907)
1907: Postal Union (1907)
1909: Kamgar Hitwardhak Sabha
1910: Social Service League
1918: General Strick at Cotton mill in Ahmadabad took place in 1918. It was
supported by Mahatma Gandhi, Anasuya Sarabhai and her brother, Ambalal
Sarabhai.
1920: Mahatama Gandhi, Anasuya Ben Sarabhai and Shankerlal Banker founded the
Ahmadabad textile labour association in 1920. He applied the theory of non-violence
in industrial relations.
This first properly registered trade-union was started in Madras by the initiative of
Mr. B.P. Wadia who established the Madras Labour Union in 1918.
1920: Lala Lajpat Rai founded All India Trade Union Congress (A.I.T.U.C). He was
helped by Joseph Baptista, N.M Joshi and Diwan Chaman Lal. Lajpat Rai was elected
the first president of AITUC.
In later half of 1920s two Acts were frames, namely, Trade Union Act of 1926 and
Industrial Disputes Act, 1929.
1929: Royal Commission on Labour, headed by John Henry Whitley, led to a series of
reforms:
• Children (pledging of Labour) Act, 1933
• Factories Act, 1934,
• Payment of Wages Act, 1936
• Trade Disputes (Amendment) Act 1938, which authorized government to
appoint conciliation officers to settle disputes.
Page | 10
• Second world war changed the economic dynamics and after WW-2 attitude of
government changed.
• State intervention began in the form of introduction of several war time
measures like the Defense of India Rules (Rule 81-A), National Service
(Technical Personnel) Ordinance, and the Essential Service (Maintenance)
Ordinance.
• Colonial government imposed extensive and pervasive controls on industrial
relations by the closing years of its era. The joint consultative institutions
were established primarily to arrive at uniform and agreeable labour policy.
• Close to India’s independence, several reforms took place:
1. Indian Trade Unions (Amendment) Act, 1947,
2. Industrial Employment (Standing Orders) Act 1946,
3. Bombay Industrial Relations Act, 1946, and
4. Industrial Disputes Act, 1947 and
5. split in AITUC and
6. formation of INTUC.
Post-Independence era:
• Initially colonial model continued but was later changed. Due to unequal
distribution of power in the labour market state started intervening. State
intervention in the IR was a part of the interventionist approach to the
management of industrial economy. However state intervention does not mean
suppression of trade unions and collective bargaining institution. State
intervention and collective bargaining were considered as complementary to
each other.
• Later, various tripartite and bipartite institutions were introduced to
supplement the state intervention in the IRS.
• The tripartite process led to participation of pressure groups in the state
managed system.
• Non-formal ways evolved intending to do away with the flaws of the formal
system.
1948 Hind Majdoor Panchayat (a Trade Union) was started by
Praja Socialist Party.
HMP was later amalgamated with Indian Federation of
Labour to form Hind Mazdoor Sabha
Page | 11
1948 Factories Act, 1948- was influenced by previous acts, ILO On
conferences and British legislations. recommendation
of Rege
Committee.
1948 Industrial Policy Resolution was prepared
1950 First five year plan: recognised dignity of labour. Workers

recognised as
part of industrial
system and their
"right of
association,
organisation and
collective
bargaining was
accepted"
1958 Code of Discipline of Industries (NOT a legal document)

approved at 16th Indian Labour Conference. G.L. Nanda,
then labour minister played important role.
Follows Gandhi’s philosophy and aims to build industrial

democracy.
The main elements of the code are:
i) The two parties agree to utilise the existing machinery
for the settlement of industrial disputes.
ii) The parties shall not resort to strikes and lock-outs
without first exploring all avenues of settlement
iii) The parties accept that the disputes not settled
mutually shall be referred to voluntary arbitration.
iv) The code specifies the criteria for the recognition of
trade union and creates an obligation on employers to
recognise the majority union in an establishment or
industry.
Page | 12
v) The two parties shall not resort to the unfair labour
practices detailed out in the code.
vi) Managements and trade unions agree to establish
grievance procedure on a
mutually agreed basis.
1960 Political and economic forces aggravated industrial

conflict and rendered non-formal system ineffective.
Thus, National Commission on Labour (NCL) was
appointed in 1966 under the Chairmanship of Justice P.B.
Gajendragadkar to reform the situation. It recommended
that works committee be set up in any unit which has a
recognised union. It also recommends growth of
collective bargaining recognition of union, prohibition
and regulation of strikes & lockouts
1980 Tripartism was revived as suggested by Several

committees.
1988 Government passed the Trade unions and the Industrial
Disputes (Amendment) Bill, 1988.
But, it also proved yet another legislative disaster as it
was severely criticised by the left parties.
Consequently, the tripartite deliberations held at the ILC in 1990 decided three
measures to reform IR in India:
1. To withdraw the Trade Union and the Industrial Disputes (Amendment) Bill,
1988.
2. To constitute a bipartite committee of employers and unions to formulate
proposals for a comprehensive legislation.
3. To consider the possibility of formulating a bill on workers’ participation in
management, 1990.
In the 33rd session of ILC, another bipartite committee was constituted to
recommend changes in the TU and ID Acts. The government introduced a Bill on
Workers, Participation in Management in Parliament in 1990.
Page | 13
Since liberalization in 1991, IR in India has seen many new challenges like emergence
of a new breed of employees (popularly termed as ‘knowledge workers’), failure of
trade union leadership, economic impact, and employers’ insufficient response.
• Second National Commission on Labour was set up on 15 October 1999 under
the chairmanship of Ravindra Verma which submitted its report to the then
Prime Minister Atal Bihari Vajpayee on 29 June 2002.
• Recommendations:
• It recommended grouping of 44 central Labour laws into four or five Labour
Codes.
CONSTITUTIONAL PROVISIONS IN INDUSTRIAL RELATIONS
a. Preamble
Preamble mentions socialism as an objective (42nd Amendment).
b. Fundamental Rights
➢ Article 14: Equal pay for equal work derived from equality before law.
➢ Article 16: Equality of opportunity in matters of public employment
➢ Article 19: Protection of certain rights regarding freedom of speech etc –
Trade Union Act, 1926.
➢ Article 21: Protection of life and personal liberty No person shall be deprived of
his life or personal liberty except according to procedure established by law -
this has been interpreted to mean dignified life→ Minimum Wages Act, 1948,
Equal Remuneration Act, 1976 and Maternity Benefits Act, 1961
➢ Article 23- Prohibition of traffic in human beings and forced labour → Bonded
Labour (Abolition) Act, 1976 prohibits all kinds of bonded labour. In People's
Union for Democratic Rights vs. Union of India 1983, it was held that labour or
services for a remuneration less than a minimum wage amounts to "forced
labour".
➢ In Bandhua Mukti Morcha vs. Union of India, S.C. directed government to
ensure basic human dignity for workers.
➢ Article 24: Prohibition of employment of children in factories, etc → Child
Labour (Prohibition & Regulation) Act, 1986.
c. DPSP:
➢ Article 38
Page | 14
• Article 38 (a) directs the state to promote welfare of the people by securing
and protecting a social order in which justice social, economic and political,
shall inform all the institutions of national life.
• (b) directs that State shall, in particular, strive to minimise inequality in
income and endeavour to eliminate inequality in status, facilities and
opportunities amongst individuals as well as groups of people in different
areas and vocations.
➢ Articles 39: state shall secure:
a) that citizens, men and women equally, have the right to an adequate means of
livelihood. It means that every citizen of the country has the right to earn a
livelihood without getting discriminated based on their sex.
b) that the ownership and the control of the material resources of the community
are so distributed as to best subserve the common good.
c) that the operation of the economic system does not result in concentration of
wealth and means of production to the common detriment.
d) that there is equal pay for equal work for both men and women. Wages will not be
determined on the basis of sex rather it will be according to the amount of work
done by the worker.
e) the health and strength of the workers, men and women and the tender age of the
children not abused and that the citizens are not forced by economic necessity to
enter the avocations unsuited to their health and strength.
f) the children are given opportunities and facilities to develop in a healthy manner
and in condition of freedom and dignity and are protected against exploitation
against moral and material abandonment.
➢ Article 41
• securing the right to work, to education and to public assistance in cases of
unemployment, old age, sickness and disablement, and in other cases of
undeserved want.
➢ Article 42
• Provision for just and humane conditions of work and maternity relief.
➢ Article 43
• Secure a living wage, conditions of work ensuring a decent standard of life and
full enjoyment of leisure and social and cultural opportunities and, in
Page | 15
particular, the State shall endeavor to promote cottage industries on an
individual or co-operative basis in rural areas.
Article 43A 42nd amend.
• Participation of workers in management of industries. —The State shall take
steps to secure the participation of workers in the management of
undertakings, establishments or other organization’s engaged in any industry.
• The Industrial Disputes 1947 → constitution of Works Committee, consisting
of employers and workmen to resolve disputes.
d. Labour = concurrent subject

• Union List
– Entry No. 55
– Regulation of labour and safety in mines and oil fields
– Entry No. 61
– Industrial disputes concerning Union employees.
– Entry No. 65
– Union agencies and institutions for "... vocational or technical
training ..."
• Concurrent List
– Entry No. 22
– Trade unions, industrial and labour disputes
– Entry No. 23
– Social security and insurance, employment and unemployment
– Entry No. 24
Welfare of labour including conditions of work, provident funds, employers'
invalidity and old-age pension and maternity benefits.
Code on wages
The code subsumes:
• The Minimum Wages Act, 1948.
• The Payment of Wages Act, 1936.
• The Payment of Bonus Act, 1965.
• The Equal Remuneration Act, 1976.
Jurisdiction: The state government will be authorized to make decisions for all the
employments other than those wherein the Central Government make laws
Page | 16
Central government can make laws on matters like
• Establishment carried on by or under the authority of the Central Government
or
• The establishment of railways, major ports, air transport service,
• mines, oil field,
• telecommunication, banking and insurance company or
• a corporation, other authority, central public sector undertaking or subsidiary
companies set up by central public sector undertakings or autonomous bodies
owned or controlled by the Central Government.
Applicability of Code on Wages
The Code on Wages is applicable to all employees in both the organised and
unorganised sector. The provisions of the Code covers all the employers and
employees of all sectors except the members of the Armed Forces of the Union
and apprentices engaged under the Apprentices Act, 1961
Section 2(z): Definition of worker includes:

• Any person employed in any industry to do any manual, unskilled, skilled,
technical, operational, clerical, or supervisory work for hire or reward.
• The terms of employment may be expressed or implied.
• Working journalists defined under section 2(f) of the working journalists and
other newspaper employees (conditions of service) and miscellaneous
provisions act, 1955.
• Sales promotion employees defined under section 2(d)of the Sales promotion
employees (conditions of service) act, 1976.
PROHIBITION OF DISCRIMINATION ON GROUND OF GENDER in wages or similar
nature.
Equal Remuneration Act, 1976 prohibited employers from discriminating in wage
payments of workers based on gender. The Code subsumes the 1976 Act and
contained specific provisions which prohibited gender discrimination in matters
related to wages.
Page | 17
MINIMUM WAGES
no employer shall pay to any employee wages less than the minimum rate of wages
notified by the appropriate Government.
The appropriate Government shall fix a minimum rate of wages –
(a) for time work; or
(b) for piece work.
In accordance with following wage periods: -
1. By the hour or
2. By the day or
3. By the month.
Appropriate government shall take into account.
skill of workers- unskilled, skilled, semi-skilled and highly-skilled, or geographical
area
Arduousness of work like temperature or humidity normally difficult to bear,
hazardous occupations or processes or underground work both.
Section 8: the minimum wages shall be revised and reviewed by the central or state
governments at intervals of not more than five years.
Section 9: the central government will fix a national floor rate for wages by
considering the living standard of workers and set different floor wages based on
different geographical areas. Thus the minimum wages fixed by the State or Central
government’s must be higher than this floor wages and if the minimum wages fixed
by the government are much higher than this they cannot reduce the existing
wages.
The central government before fixing the floor wages must obtain the advice of
Central Advisory Board and may also consult with the respective State
governments.
Wages for working overtime:
Centre has reduced normal working hours in a day to eight hours from nine
proposed in the earlier version released last November. Also, one or more intervals
of rest which in total shall not exceed one hour
Section 10: If an employee works for overtime than the normal working time, he will
be entitled to get overtime wages which is twice the rate of normal wages.
Page | 18
Deductions that can be made from wages.
1. fines imposed on him; or
2. absence from duty; or
3. damage to or loss of goods which was entrusted to him for custody: or
4. house accommodation provided by the employer; or
5. for amenities and services provided for the employee.
These deductions should not exceed 50 percent of the employee’s total wage.
Payment of bonus
Section 26: The code requires employers to pay a bonus to its employees whose
wages are below such monthly amount as may be notified by the state or central
government and who has put in at least thirty days work in an accounting year. The
annual minimum bonus shall be (i) 8.33% of his wages, or (ii) Rs 100, whichever is
higher. In addition to this, the employer shall also distribute a part of the gross
profits amongst the employees, in proportion to the annual wages of an employee.
An employee can receive a maximum bonus of 20% of his annual wages
Advisory Boards
Section 42: The Central and State governments would constitute advisory boards.
The Central Advisory Board would consist of following persons:
1. representing employers;
2. representing employees, in equal numbers as that of the employers;
3. independent persons not exceeding one third of the total members of the
board;
4. five representatives of the state governments as nominated by the Central
government.
The State Advisory Board would consist of following persons:

1. representing employers;
2. representing employees which shall be equal in numbers as that of the
employers;
3. independent persons, not exceeding one-third of the total members of the
board or committee or sub-committee.
Page | 19
Also one-third of the total members on both the Central and State Advisory Boards
will be women. The State Advisory Board may constitute one or more committees or
sub-committees to look into issues pertaining to matters specified in (a) to (d) given
in duties below.
Duties of Central and State Advisory Boards are to advice the respective
governments on issues relating to:
a) fixation or revision of minimum wages and other connected matters.
b) providing and increasing employment opportunities for women.
c) the extent to which women may be employed in such establishments or
employments as the Central and the State Government may specify it by
notification and
d) any other matter relating to this Code.
Inspector-cum-Facilitator
Section 51: provides for appointment of Inspector-cum-Facilitator. The Inspector-
cum-Facilitator are public servants appointed by the government.
Powers of Inspector-cum-facilitator:
1. Make search, seizure or can take copies of register, record of wages or
notices.
2. Notify the appropriate government about defects or abuses in an
establishment.
Inspections will be carried out on the basis of a web-based inspection schedule that
will be decided by the central or state government.
Penalties for offences
Section 54: deals with the penalties for offences.
Section 53: Deals with the power of officers of appropriate Government to impose
penalty in certain cases.
The penalty for offences varies from one offence to another, maximum penalty being
imprisonment for 3 months along with a fine of up to one lakh rupees.
The appropriate government may appoint any officer not below the rank of Under
Secretary to Government of India or an officer of equivalent rank in the State
Government to dispose of cases punishable only with fine up to fifty thousand
rupees, so as to reduce the burden on subordinate judiciary;.
Page | 20
Under Section 52, if a complaint is received from an employee or a registered union
under the Code the appropriate government or the officer appointed on behalf of
government or an Inspector-cum-Facilitator may take cognizance of the case.
Period of Limitation for filing of claims:
Earlier workers could file claims in a time period varying from 6 months to 2 years.
Now it has been increased to 3 years.
Burden of Proof on employer: a claim has been filed for non-payment of
remuneration or bonus or less payment of wages or bonus or on account of making
deduction not authorised by the legislation, the burden shall be on the employer to
prove that the said dues have been paid to the employee.
Reference of Disputes under the Code
Section 46: Any dispute arising between an employer and his employees with
respect to –
a) fixation of bonus or eligibility for payment of bonus under the provisions of
the Code; or
b) the application of the Code, in respect of bonus, to an establishment in public
sector,
then, such dispute shall be deemed to be an industrial dispute within the meaning of
the Industrial Disputes Act, 1947.
INDUSTRIAL RELATIONS CODE, 2020

The IR Code subsumes the following legislation, which will stand repealed once the
IR Code is implemented, namely:
a. The Trade the Industrial Disputes Act, 1947 (IDA);
b. Unions Act, 1926 (TU Act); and
c. The Industrial Employment (Standing Orders) Act, 1946 (IESO Act).
Key aspects
A. Definitions:
i. ‘Employee’ and ‘worker’
For the purpose of Chapter III (Trade Unions), of the IR Code, the term ‘worker’
means
a. all persons employed in trade or industry; and
Page | 21
2. includes the worker as defined under the Unorganised Workers’ Social
Security Act, 2008.
The expanded scope of the ‘worker’ definition will bring a larger part of the
workforce (including those engaged in the unorganised sector) within the purview
of the IR Code.
ii. ‘Individual Dispute’
The definition of ‘industrial dispute’ is expanded to explicitly include disputes or
differences between an individual worker and an employer, connected with, or
arising out of
i. discharge,
ii. dismissal,
iii. retrenchment, or
iv. termination of such individual worker (Individual Dispute).
iii. ‘Wages’
The scope of the all remuneration by way of salaries, expressed in

definition of wages has monetary terms, which includes basic wages, dearness
been widened. allowance and retaining allowance.
Only 15% of total remuneration can be given in kind. That
too shall form part of wages.
What are excluded a. Statutory Bonus,

from the definition of
b. Provident Fund,
salary
c. Pension,
d. House rent allowance,
e. Value of house accommodation and utilities,
f. Conveyance allowance,
g. Sum paid to defray special expenses due to the nature
of work,
h. Any overtime allowance,
Page | 22
i. Any commission,
j. Any retrenchment compensation, and
k. Gratuity.
iv. ‘Trade Union Dispute’

The IR Code has introduced the concept of ‘Trade Union Disputes’, which has been
defined to mean any dispute relating to trade unions arising either between two or
more trade unions or between the members of a trade union. This empowers the
industrial tribunals to adjudicate disputes arising between trade unions as well.
v. ‘Employer’
The IR Code has expanded the definition of ‘employer’ to cover contractors and legal
representatives of a deceased employer.
vi. ‘Strike’
The definition of the term ‘strike’ has been extended to include within its meaning
any concerted casual leave on a given day, taken by 50% or more workers employed
in a particular industry. This is aimed at dissuading workers from taking
unannounced concerted casual leave with the intention to disrupt or stop the work
at the establishment of an employer.
B. Industrial Relations and Disputes
Under previous act Under new code
Prior IDA: For industrial Threshold increased to 300. This change has
permission of establishment in no impact for industrial establishments other
appropriate which less than than factories, mines, and plantations.
government 100 workmen are
for employed or were
Retrenchment, employed on an Discretion given to the appropriate
Lay-off and average per Government to notify a threshold higher than
Closure in working day for 300 workers.
factories, the preceding 12
mines and months.
plantations Appropriate Government has been
empowered to prescribe retrenchment
Page | 23
Retrenchment compensation other than the average pay of
compensation= 15 days prescribed under the IDA.
average pay of 15
days.
Strike and notice of strike workers employed in an industrial

lock-out needs to be given establishment/ or employers of industrial
only in public establishments (irrespective of it being a
utility services. public utility service industry or not)
are not allowed to go on a strike/ declare
lock-out, as the case may be, in breach of
Both the IDA and contract, inter alia
the IR Code
(i) without giving a notice within 60 days
provide that no
before striking/ locking-out, as the case may
strikes or lockouts
be; or
are permitted
during the (ii) within 14 days of giving such notice; or
pendency of any
(iii) before the expiry of the date of strike/
conciliation
lock-out, as the case may be, specified in such
proceedings before
notice.
a conciliation
officer and 7 days
after the no strike or lock-out, is permitted during:
conclusion of such
proceedings. (i) the pendency of a proceeding before
tribunal or a national tribunal and 60 days,
after the conclusion of such proceedings; or
(ii) the pendency of arbitration proceedings
before an arbitrator and 60 days after the
conclusion of such proceedings; or
(iii) any period in which a settlement or award
is in operation, in respect of the
matters covered by the settlement or award.
Page | 24
employer 21 day prior notice Notice of Change continues to apply, it
intends to of such change is provides for two additional situations where
make any required to be such a notice is not required to be given.
unilateral given to the These are:
change workmen (Notice
(a) emergent situation which requires
of Change).
change of shift or shift working in
consultation with Grievance Redressal
Committee constituted under the IR Code; or
(b) if such change is effected in accordance
with the orders of the appropriate
Government or in pursuance of any
settlement or award.
reference of by the appropriate any concerned party may make an application

disputes Government to the in the prescribed form to the tribunal in the
concerned matters which are not settled by the
authority conciliation officer, within 90 days from the
date of receipt of the report prepared by the
conciliation officer. Separately, in case of
dispute arising out of individual grievances,
the aggrieved party can directly appeal to the
appropriate tribunal after the expiry of 45
days from the date he has made the
application to the conciliation officer of the
appropriate Government for conciliation of
the said dispute.
The power of reference of the Central
Government has been retained for matters of
national importance or for industrial
establishments situated in more than one
State, which could be affected by such an
industrial dispute.
Grievance not mandatory if mandatory even if the employer has an

Redressal establishment internal grievance redressal mechanism in
Committee already has place- equal representatives of both workmen
(“Committee”) grievance and employer.
For industrial redressal
Page | 25
establishment mechanism- equal
having 20 or representatives of
Adequate representation of women workers
more workmen both workmen and
which shall not be less than the proportion of
employer
women workers to the total workers
including women
employed in the industrial establishment.
members.
Number of members = 10
Number of
members = 6
Appeal against made to the appeal against the decision or if the matter
the decision of employer who is has not been resolved, has to be filed with the
the committee required to redress conciliation officer (and not the employer)
it within a period within 60 days from the date of the decision of
of one month from the Committee or on expiry of the time limit
the date of receipt for completion of proceedings by the
of such appeal. Committee (i.e., period of 30 days from the
date of receipt of grievance application), as the
case may be.
Application After the expiry of reduced from three years to 2 years from the
can be made 45 days of making date of discharge, dismissal, retrenchment or
directly to the an application for termination of service of a worker. Certain
labour court or conciliation of the State Governments, such as Gujarat has
tribunal for dispute. However, reduced the time limit for raising individual
adjudication of the same has to be dispute from 3 years to 1 year.
Individual made within three
Worker’s years from the
Dispute date of discharge,
dismissal,
retrenchment or
termination of
service of the
aggrieved worker.
Page | 26
iv. Dispute Resolution
There is the significant reduction in the number of authorities under the IDA.
Unlike the IDA, the jurisdiction and authority of
▪ labour courts,
▪ courts of inquiry or
▪ boards of conciliation
have been excluded and disputes under the IR Code are to be adjudicated only by
conciliation officers, arbitrators and industrial tribunals.
There is also a change in the constitution of industrial tribunals under the IR Code
which provides for one judicial and one administrative member (in place of only one
judicial member who presently presides the industrial tribunal under the IDA).
Certain matters, as may be specified in the rules, can also be decided by single
member industrial tribunal under the IR Code.
The IR Code expressly bars the conciliation officer from holding any proceeding
relating to an industrial dispute after 2 years from the date on which the industrial
dispute arose.
Earlier conciliation officer had to submit report to concerned parties and
appropriate government within 14 days after closure of investigation. Now report
has to be sent within 45 days.
To file an application in respect of any dispute out of individual dispute, the IR Code
provides a time limit of 1 year from the date on which the cause of action arose.
Further, the IR Code clarifies that the decision of the Committee is made on the
basis of the majority view of the Committee and more than half of the members
representing the workers on the Committee should have agreed to such a decision.
Unfair Labour Practices
Wilful go slow has been defined in the act as unfair practice. The term go-slow mean
“an occasion when more than one worker in an establishment conjointly work more
slowly and with less effort than usual to try to persuade the employer of the
establishment to agree to higher pay or better service condition or such other
demand”.
Power to Transfer Certain Proceedings
The appropriate Government may withdraw any proceeding pending before any
authority and transfer the same to another authority under the IDA, for the disposal
Page | 27
of the proceeding. The appropriate Government has been given similar powers
under the IR Code.
The Central Government has been given the discretion to withdraw any proceeding
pending before an industrial tribunal constituted by the Central Government or the
State Government and transfer it to the National Industrial Tribunal for disposal of
the proceeding.
C. Trade Unions
i. Sole Negotiating Union and Negotiation Council
The IR Code has introduced the concept of a negotiating union or council.
An industrial establishment having a registered trade union shall have a negotiating
union or a negotiating council, as the case may be, and such negotiating union or
council shall negotiate with the employer on such matters as may be prescribed.
In case there is only one trade union in an industrial establishment, the employer is
required to recognise such trade union as the sole negotiating union of the workers.
In case of multiple recognised trade unions, one with the support of at least 51% of
the workers on the muster roll of that establishment as members will be recognised
as the sole negotiating union by the employer. In case the industrial establishment
has no trade union with at least 51 % of the workers on its muster roll as members,
the employer should constitute a negotiating council consisting the representatives
of registered trade unions which have the support of not less than 20 % of the total
workers on the muster roll of that industrial establishment and such representation
shall be one representative for each 20% of the workers.
D. Standing Orders
i. Applicability of the chapter on standing orders
Under the IR Code, the threshold for applicability of the provisions relating to
standing orders has been increased from 100 to 300 workers.
ii. Model Standing Orders and concept of deemed certification
The IR Code gives the employers an option to either frame their own standing
orders or adopt the model standing orders drafted under the IR Code. In this
regard, the Central Government will frame the model standing orders relating to
conditions of service and related matters.
Further, the IR Code eases compliance for employers by introducing the concept of
deemed certification of the model standing orders. Under the IR Code, if an
employer adopts the model standing orders, the same shall be deemed to have been
Page | 28
certified and the employer is only required to inform the certifying officer of such
adoption.
However, in case of any modifications to the model standing orders, such
modifications are required to be submitted by the employer to the certifying officer
for certification in the manner prescribed under the IR Code.
Employer has to consult trade unions or recognised negotiating union or members
of the negotiating council on the draft standing orders prior to submission of the
same to the certifying officer for certification.
The IR Code, further, requires the certifying officer to complete the process of
certification within a period of 60 days from the date of receipt of the draft standing
orders or the modified standing orders, as the case may be.
iii. Appeal against order of the certifying officer
The timeline for making an appeal against the order of the certifying officer has
been increased from 30 days to 60 days under the IR Code.
E. Concept of Fixed-Term Employment
In an attempt to recognise fixed term employment and contracts, the Central
Government by way of notification dated March 16, 2018 incorporated fixed term
employment as a classification of workmen under the central rules framed under
the IESO Act across all sectors, where the Central Government is the appropriate
Government.
IR Code has also expressly recognised fixed term employment.
The IR Code aims at protecting the rights and ensuring welfare of the fixed term
employees. Under the IR Code, a fixed term worker shall be entitled to:
i. Parity in wages, working hours, allowances and other benefits of fixed term
workers and permanent workers for doing same work or work of similar nature.
ii. Statutory benefits extended to all permanent workers proportionate to his
period of employment, notwithstanding the qualifying period to receive such
benefits provided under the respective legislations.
iii. Gratuity benefits, if such fixed term worker renders service for 1 year under the
contract.
The definition of the term ‘retrenchment’ under the IR Code, has been amended to
specifically remove ‘termination of service of worker as a result of completion of
tenure of fixed term employment’.
Page | 29
F. Establishing a Worker Re-Skilling Fund by appropriate government
to provide monetary support to retrenched workmen, for training and re-skilling
purposes.
The said fund will consist of:
i. The contribution of the employer of an industrial establishment
equivalent to 15 days’ wages last drawn by the worker immediately before
retrenchment, or such other number of days as may be notified by the Central
Government, for every retrenched worker in case of retrenchment only;
ii. The contribution from such other sources as may be prescribed by the
appropriate Government.
This fund will be utilised by crediting an amount equivalent to 15 days wages last
drawn by the retrenched worker to such worker’s account within 45 days of such
retrenchment in the prescribed manner. This amount would be paid in addition to
the compensation paid to a worker at the time of retrenchment.
G. Penalties and Offences
While laying down uniform penalties for non- compliance with provisions under the
IR Code relating to inter alia conditions of employment in an industrial
establishment, settlement of disputes and trade unions, the IR Code enhances the
penalties for offences committed thereunder, adding to their deterrence value.
The decriminalisation of various offences is in stark contrast with the extant
laws which prescribe imprisonment even for general non-compliances.
H. Other Salient Features
i. Emphasis on ensuring compliance rather than penalising an employer
to achieve this objective:
Page | 30
Compounding of offences
Unlike the current legislations, the IR Code provides for compounding of certain
offences either before or after an enquiry is held or prosecution is initiated in a
prescribed manner, by paying.
• Offences punishable with fine only • 50% of the

maximum
fine
• Offences punishable with imprisonment • 75% of the

now exceeding one year or fine maximum
fine
However, the option of compounding is not available for the offence committed the
second or subsequent time within a period of 3 years from the date of either: (i)
commission of a similar offence which was earlier compounded; or (ii) commission
of a similar offence for which conviction order has been passed.
In this regard, if any person fails to comply with an order to compound an offence,
such person shall be liable to pay an additional penalty equivalent to 20% of the
maximum fine prescribed for such compounded offence.
ii. Filings/registration of trade union, application for certification of standing
orders etc. can be done electronically.
iii. Power to exempt
The existing corresponding legislations, i.e., IESO Act and the IDA, empower the
appropriate Government to exempt an industrial establishment from the
provisions of the said legislation, by way of notification. In this regard, under IDA,
such exemption would be afforded if the appropriate Government is satisfied that
the industrial establishment has adequate provisions to investigate and settle
industrial disputes in respect of workmen employed by
such industrial establishment. In addition to the above, under the IR Code the
appropriate Government has been vested with the discretionary power to exempt
“new industrial establishments” and “new undertakings” from all or any provisions
of the IR Code, if deemed necessary in public interest.
In this regard, it may be pertinent to note that the term ‘public interest’ has
not been defined in the IR Code.
iv. Exclusion of jurisdiction of civil courts
Page | 31
This is a modification brought about by the IR Code, leaving employers and
employees with recourse only to approach authorities prescribed under the IR Code.
OCCUPATIONAL SAFETY, HEALTH AND WORKING CONDITIONS CODE, 2020
The Occupational Safety, Health and Working Conditions Code, 2020 subsumes the
following 13 legislation, which will stand repealed once the OSH Code is
implemented:
1. The Factories Act, 1948 (Factories Act);
2. The Mines Act, 1952 (Mines Act);
3. The Dock Workers (Safety, Health and Welfare) Act, 1986;
4. The Building and Other Construction Workers (Regulation of Employment
and Conditions of Service) Act, 1996 (BOCW Act);
5. The Plantations Labour Act, 1951 (Plantation Act);
6. The Contract Labour (Regulation and Abolition) Act, 1970 (CLRA);
7. The Inter-State Migrant Workmen (Regulation of Employment and Conditions
of Service) Act, 1979 (ISMW Act);
8. The Working Journalist and other Newspaper Employees (Conditions of
Service and Miscellaneous Provisions) Act, 1955 (Journalists Act);
9. The Working Journalist (Fixation of Rates of Wages) Act, 1958;
10. The Motor Transport Workers Act, 1961;
11. Sales Promotion Employees (Condition of Service) Act, 1976 (Sales Promotion
Act);
12. The Beedi and Cigar Workers (Conditions of Employment) Act, 1966; and
13. The Cine Workers and Cinema Theatre Workers (Regulation of Employment)
Act, 1981 (Cine Workers Act).
Objective: To consolidate and amend the laws regulating occupational safety, health
and working conditions
The key aspects of the OSH Code:
A. Definitions:
i. ‘Employee’ and ‘worker’
The definition of ‘employee’ under the OSH Code, includes
any person employed on wages by an establishment, either directly or through
a contractor, to do any skilled, semi-skilled or unskilled, manual, operational,
supervisory, managerial, administrative, technical or clerical or any other
work, as well as those persons declared to be an employee by the appropriate
Government.
Page | 32
Working journalists and sales promotion employees have also specifically
been brought within the scope of the definition of ‘worker’.
It also introduces the concept of ‘worker’ but excludes:
(i) persons employed in a supervisory capacity whose monthly salary is
INR 18,000 or more; and
(ii) persons who are employed mainly in managerial and administrative
capacity.
It makes it mandatory on the employer to issue a written form of an appointment
letter to all employees, which was earlier mandated under very limited
circumstances.
The Central Government can also prescribe rules governing health, safety and
working conditions for all employees.
ii. ‘Contract labour’ vis-à-vis ‘Contractor’ and ‘Employer’
Contract labour means a worker who is hired through a contractor whether with
the knowledge of the principal employer or not. The definition of contract labour
brings within its ambit inter-state migrant workers.
The definition of ‘contract labour’ specifically excludes.
A worker (other than a part-time worker), who is regularly employed by the
contractor for any activity of his establishment on mutually accepted standards of
conditions of employment on a permanent basis, and gets periodical increments in
pay, social security coverage and other welfare benefits in accordance with the law.
The OSH Code defines a contractor to mean a person who:
• undertakes to produce a given result for the establishment, other than a mere
supply of goods or articles of manufacture to such establishment, through
contract labour, or
• supplies contract labour for any work of the establishment as a mere human
resource and includes a sub-contractor.
The definition clarifies that the head of the department, occupier/ manager of a
factory, or person having ultimate control over the affairs of the establishment
(where such affairs are entrusted to a manager or managing director, such
manager or managing director) are all covered within the ambit of the term
employer.
iii. ‘Factory’ and ‘Establishment’
The OSH Code will apply to all establishments where 10 or more workers are
employed.
Page | 33
This would also bring within its fold commercial establishments such as IT/ITeS
establishments, which would also be required to comply with the provisions of the
OSH Code.
Even factories, which employ 10 or more workers, are, for the purposes of obtaining
a registration under the OSH Code, considered as establishments.
However, the threshold for a premise to be considered as a factory under the OSH
Code has been increased from the existing threshold under the Factories Act from
10 or more to 20 or more workers, if manufacturing process is undertaken with the
aid of power; and from 20 or more to 40 or more workers if manufacturing process
is undertaken without the aid of power.
iv. ‘Occupier’
Person having ultimate control of a factory is called occupier. In case of a company,
any one of the directors can be designated as the occupier, except an independent
director within the meaning of sub- section (6) of Section 149 of the Companies Act,
2013.
v. ‘Wages’
The wages include all including
• basic wages,
• dearness allowance and
• retaining allowance.
It excludes:
a. Statutory Bonus,
b. Provident Fund,
c. Pension,
d. House rent allowance,
e. Value of house accommodation and utilities,
f. Conveyance allowance,
g. Sum paid to defray special expenses due to the nature of work,
h. Any overtime allowance,
i. Any commission,
j. Any retrenchment compensation, and
k. Gratuity.
vi. ‘Appropriate Government’
Page | 34
Central • central public sector undertakings (PSU) even if
government its shareholding in the PSU falls below 50% post
the commencement of the OSH Code.
• any industry controlled by the Central
Government or so notified in this regard.
• railways, mines, oil, field, major ports, etc
State • Other cases
government • factory situated in that State.
B. Registration of Establishments and Closure Requirements

i. Registration of Establishments
At national level, all establishments (whether a factory or a commercial
establishment such as IT/ITeS establishments) have to obtain a single registration
within 60 days from the date of applicability of the OSH Code.
Any subsequent change in the ownership or management etc is required to be
electronically intimated to the registering officer within 30 days of such change.
In case of closure of establishments, the OSH Code requires a simple post-facto
intimation of closure of the establishment to be electronically provided within 30
days of the closure, accompanied with a certification that all dues to workers
employed in the establishment have been paid.
It would be relevant to note that the failure to obtain registration will disbar an
employer from employing any employee in the establishment.
ii. Licencing of Factories
Establishment can opt for and obtain a common licence in respect of a factory,
industrial premises for beedi and cigar work, and for engaging contract labour, or
any combination thereof (Common License), with an alternative option for a single
licence for any one of them.
iii. Licencing of contractors
The OSH Code has also introduced the concept of ‘work-specific licence’ for project
based work orders and a ‘national’ license for undertaking work in more than one
State.
Page | 35
C. Hours of Work, Annual Leave, Overtime Provisions
i. Daily and weekly working hours
Reduced the daily working hour limit from 9 hours. The appropriate Government
can prescribe rules to limit the hours of overtime that an employer can engage its
workers for, and also requires obtaining the worker’s consent to work overtime.
The OSH Code has also empowered the appropriate Government to prescribe daily
working hours, intervals of rest and spread over, such that the maximum daily
hours do not exceed 8, and also to prescribe the total number of hours of overtime.
Employer can fix weekly off for its workers so long as they are not made to work
continuously for more than 6 days.
ii. Annual leave with wages
The qualifying period for entitling worker leave is reduced to 180 days from 240
days and now they can avail leave earned in the same calendar year. Earlier they
could avail them in the next year.
D. Special Provisions on Employment of Women
Removed the restrictions imposed on employers for employing women under the
Factories Act and the Plantation Act.
At present, the Factories Act mandates a specific notification to be issued by State
Governments to provide an exemption for women to work more than 9 hours in a
day and to work beyond the hours of 6 a.m. to 7 p.m., subject to the condition that
women will not be permitted to work between 10 p.m. and 5 a.m.
In contrast, the OSH Code sets out a general enabling provision for women to be
employed in any establishment for any work before 6 a.m. and after 7 p.m., the only
condition being that the consent of the woman is obtained before employing her and
compliance with additional safeguards relating to their safety, holidays, working
hours, etc., to be prescribed by the appropriate Government.
Appropriate government can make additional requirements to ensure their health
and safety.
E. Provisions Relating to Contract Labour

i. Employment of contract labour ( 50 or more contract labour)
Provisions of this chapter applies to establishments in which 50 or more contract
labour are employed or were employed on any day in the preceding 12 months
Page | 36
through contract, and to every manpower supply contractor who has employed 50
or more contract labour on any day of the preceding 12 months.
ii. Core sector prohibition
In core activities of the establishment, contract labours cannot be employed.
iii. Obligations on principal employers
Earlier, principal employers had secondary obligation to provide welfare facilities
and amenities to contract labour, ONLY IF contractor fails to do so. Now, principal
employers are specifically made responsible for providing the prescribed welfare
facilities and meeting the prescribed standards for occupational health and safety at
their establishment, to the contract labour engaged at such establishment, and
does not provide for a statutory right to claim reimbursement from the contractor
for such facilities.
iv. Other important provisions
A contractor has the primary responsibility to make payment of wages to contract
labour within the prescribed time periods, failing which the principal employer is
required to make such shortfall payment and may subsequently recover these costs
from the contractor. The appropriate Government may also recover these amounts
from the security deposit paid to it by the contractors.
Payment has to be made through bank transfer or electronic mode and intimate
such mode of payment to the principal employers electronically.
F. Inter-State Migrant Workers
Earlier ‘inter-state migrant workmen’ were to be recruited by or through
a contractor in one State for employment in an establishment in another State.
The OSH Code has significantly increased the ambit of the meaning of ‘inter-state
migrant worker’ and has included persons who have come from one State and
obtained employment in an establishment in another State (termed as the
‘destination State’) or has subsequently obtained employment in a different
establishment in that destination State.
It would also include persons who have been directly recruited by an employer for
its establishments.
However, it excludes from its purview those individuals whose monthly wages are
in excess of INR 18,000 or such other amount as may be notified by the Central
Government.
Application of welfare provision in regard to inter-state migrant workers-
Page | 37
to every establishment in which 10 or more inter-state migrant workers are
employed or were employed in the preceding 12 months.
The OSH Code provides for extension of benefits that are available to workers of
the establishment, to inter-state migrant workers, under the Employees’ State
Insurance Act, 1948 (ESI Act), Employees’ Provident Fund and Miscellaneous
Provisions Act, 1952 (EPF Act), or any other law in force and to provide medical
check-up facility as provided to workers.
The OSH Code empowers the appropriate Government to make schemes to:
(a) provide inter-state migrant workers an option to avail benefits of public
distribution system either in his native State or his destination State, and
(b) to provide for portability of benefits of inter-state migrant workers working for
building and other construction work, out of the building and other construction
work cess fund in the destination State.
G. Other Workers
i. Audio-visual workers
The OSH Code has introduced the concept of an ‘audio- visual worker’, which is
substantially wider than that of a cine-worker, covered under the Cine Workers Act.
An audio-visual worker, under the OSH Code, refers to a person employed directly
or indirectly, in connection with audio-video production as an artist of various
descriptions, and whose remuneration does not exceed the threshold to be
prescribed by the Central Government.
Audio-video production includes animation, audio-visual advertisement, digital
production, feature and non-feature films, television, web-based serials, talk shows,
reality shows and even sports shows.
Therefore covers a wide variety of workers in the entertainment industry and will
require employers of these establishments to ensure compliance with the provisions
on the standards for occupational safety, health, working conditions and welfare
facilities.
ii. Working journalists and sales promotion employees
The ambit of ‘working journalists’ has been broadened under the OSH Code from the
existing definition under the Journalists Act to also include persons employed
(whole-time or part-time) in establishments relating to electronic and digital media,
radio or other media.
Page | 38
H. Duties of Employer and Employee
i. providing a working environment that is safe and without risk to the health of
the employees, to providing adequate welfare facilities such as separate shelter-
rooms, rest-rooms, etc.
Central Government is empowered to declare, by notification, standards on
occupational safety and health for work places relating to factories, mines, dock
work, building and other construction work and other establishments as opposed to
the current regime where State Governments are empowered to make rules for
certain occupational health, safety and welfare conditions, resulting in differing
standards across states and in some cases, across industries.
ii. The OSH Code recognises the rights and needs of transgender employees and
imposes an obligation on the employer to ensure that adequate and separate
bathing places, locker rooms, rest-rooms and bathrooms are provided to
transgender employees.
iii. The threshold of employees for the provision of welfare facilities has been
reduced from the current thresholds under the Factories Act. For example:
a. canteen facilities are required in all
establishments for employees, wherein 100 or more workers, including contract
labourers, are ordinarily employed, as against the current threshold of 250 workers
under the Factories Act;
b. adequate, suitable and separate shelters or restrooms for male, female and
transgender employees and a lunch room in every factory and mine where more
than 50 workers are ordinarily employed, as against the current threshold of 150
workers;
c. the appointment of a welfare officer in every factory, mine or plantation
where 250 or more workers are ordinarily employed, as against the current
threshold of 500 workers.
v. Provision of an ambulance room in every factory, mine, building or other
construction work where more than 500 workers are ordinarily employed is a new
welfare facility prescribed under the OSH Code for which the Central Government is
empowered to notify rules.
vi. Another new mandatory facility introduced under the OSH Code is free
temporary living accommodation within, or as close to, the work site as possible
to be provided by an employer to all building workers employed, and for causing
removal or demolition of the temporary accommodation.
Page | 39
vii. Safety Committee and safety officers: The OSH Code empowers the
appropriate Government to require any establishment or class of establishments to
constitute in the prescribed manner a Safety Committee consisting of equal number
of representatives of employers and workers engaged in such establishment.
Further, the OSH Code mandates appointment of safety officers with such
qualifications and perform such duties, as may be prescribed by appropriate
Government in:
(i) every factory which employs 500 workers; or
(ii) a factory carrying on hazardous process, which employs 250 workers; or
(iii) building or other construction work where 250 workers are employed;
or
(iv) mine where 100 or more workers are ordinarily employed.
xiii. The OSH Code also imposes certain responsibilities on the employees, such as:
(i) co-operating with employers in meeting the provisions of the OSH Code;
(ii) reporting of any unhealthy or unsafe working situation to the employer;
(iii) taking reasonable care for the health and safety of himself and of other
persons who may be affected by his acts or omissions at the workplace; and
(iv) bringing to the attention of the employer, events in
the workplace which may cause serious bodily injury or death or are an
imminent danger to health of the employees.
H. Penalties
The OSH Code enhances the penalties for offences committed thereunder, adding to
their deterrence value.
Under the OSH Code, penalties by way of imprisonment is reserved for serious
infractions (such as those leading to death or serious bodily injury or obstruction of
authorities in performing their duties).
The decriminalisation of various offences is in stark contrast with the extant laws
which prescribe imprisonment even for general minor non-compliances.
G. Other Salient Features
i. Emphasis on ensuring compliance rather than penalising an employer
Various measures have been introduced to achieve this objective:
a. Inspector-cum-Facilitator
Page | 40
The OSH Code provides for the appointment of an Inspector-cum-Facilitator, whose
role is enlarged to encompass not just inspection, but also to supply information and
sensitise employers and workers of the provisions of the OSH Code and compliance
therewith.
b. Inspection
The appropriate Government is empowered to frame an inspection scheme that may
provision for web-based information and calling for information electronically as
well as assign duties to carry out such inspections based on a random selection.
c. Prior opportunity to rectify
The OSH Code permits the employer to rectify any non-compliances under certain
circumstances, and further restricts the Inspector-cum-Facilitator from initiating
action unless the employer has been given such an opportunity to rectify the non-
compliance within a period of 30 days from the date of notice giving such
opportunity. However, the employer would be disqualified from availing such an
opportunity if it subsequently indulges in similar violation within a period of 3
years.
d. Compounding of first offence
OSH Code provides for compounding of certain offences either before or after an
enquiry is held or prosecution is initiated in a prescribed manner, by paying 50% of
the maximum penalty in case of a penalty, and 75% of the maximum fine in case of
an offence.
However, the option of compounding is not available for the offence committed the
second or subsequent time within a period of 3 years from the date of either: (i)
commission of a similar offence which was earlier compounded; or (ii) commission
of a similar offence for which conviction order has been passed.
ii. Maintenance of registers and records electronically
Returns may also be filed electronically.
OSH Code recognises the issuance of wage slips in electronic format to employees.
iii. Social Security Fund
Establishment of a social security fund by the appropriate Government for the
welfare of unorganised workers as defined under the Unorganised Workers Social
Security Act, 2008.
The amounts collected as penalties for certain non- compliances under the OSH
Code and the amounts collected through compounding of offences under the OSH
Page | 41
Code will be utilised for this fund. Appropriate government can prescribe other
sources also.
It is pertinent to note that the Code on Social Security, 2020, also provides for
establishment of a social security fund for unorganised workers.
iv. Power to exempt
Appropriate Government has power to exempt establishments or class of
establishments from any provisions of the OSH Code, rules or regulations.
In addition, State Governments have been vested with the discretionary power to
exempt a “new factory” or “class or description of new factories” from all or any
provisions of the OSH Code, if deemed necessary in public interest to create more
economic activities and employment opportunities for a specified period from the
date commercial production starts.
An additional discretionary power is vested with the appropriate Government to
exempt any workshop or workplace where manufacturing process is carried on and
attached to a public institution maintained for the
purposes of education, training, research or information, from provisions of the
OSH Code.
However, such exemption cannot be granted in relation to hours of work and
holidays without obtaining approval of the appropriate Government of a scheme
regulating the hours of work, intervals of rest and holidays of persons employed at
the institution.
v. Powers during an epidemic, pandemic or disaster
Drawing from the experience of the COVID-19 pandemic, the OSH Code provides the
appropriate Government the power to exempt any workplace, work activity or class
thereof from provisions of the OSH Code in the event of any public emergency,
disaster or pandemic in the whole or part of the country, for a period of up to one
year at a time.
vi. Exclusion of jurisdiction of civil courts
In respect of any matter to which the OSH Code applies, leaving employers and
employees with recourse only to authorities prescribed under the OSH Code.
Page | 42
CODE ON SOCIAL SECURITY, 2020
The SS Code consolidates Central laws that govern and regulate the social security
entitlements of the Indian workforce. It subsumes:
1. the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952
2. the Employees State Insurance Act, 1948 (ESI Act);
3. the Payment of Gratuity Act, 1972 (POGA);
4. the Employees Compensation Act, 1923 (ECA);
5. the Maternity Benefit Act, 1961 (MB Act);
6. the Building and Other Construction Workers Cess Act, 1996
7. the Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959;
8. the Cine Workers Welfare Fund Act, 1981; and
9. the Unorganised Workers’ Social Security Act, 2008.
Objective: To amend and consolidate the laws relating to social security and related
matters to universalise social security benefits i.e. to extend social security to all
employees and workers in the organised and unorganised sector or in any other
sector, including to employees, wage workers, contract labourers, gig workers,
platform workers, home- based workers or self-employed individuals.
The key aspects:
A. Definitions:
i. Social security
The SS Code introduces a unified definition of ‘social security’, according to which
‘social security’ includes measures of protection afforded to
(i) employees,
(ii) gig workers, and
(iii) unorganised workers and
(iv) platform workers:
• To ensure access to healthcare;

• To provide income security particularly in cases of old age, unemployment,
sickness, invalidity, work injury, maternity or loss of a breadwinner.
ii. Different categories of employees and workers
The SS Code has defined the following categories of workers and employees to
extend the applicability of social security benefits to workers in all organised and
unorganised sectors.
a. Building worker:
Workers engaged in construction, alteration, repairs, maintenance or demolition in
relation to buildings, streets, roads, railways, tramways, airfields, irrigation,
drainage, embankment. But it excludes building or other construction work related
to any factory or mine, or where such work is for residential purposes employing
Page | 43
less than 10 workers, and the total cost of such work does not exceed INR 50,00,000,
or a higher amount and employing more than the number of workers, as notified by
the appropriate Government.
b. Contract labour:
The definition of ‘contract labour’ under the SS Code, is aligned with the definition
of the term in the other Labour Codes.
c. Employee:
The SS Code definition of ‘employee’ is in alignment with the definition provided in
the other Labour Codes; The definition excludes an apprentice engaged under the
Apprentices Act, 1961 or any member of Armed Forces of the Union.
For the purposes of provident fund and ESI (defined below) benefits, wage ceilings
for employees to be covered under the SS Code will be prescribed by the Central
Government.
For the purposes of employee’s compensation, the definition of employee refers to
such persons as specified in the Second Schedule of the SS Code. It may also be noted
that the appropriate Government can only make additions to the second Schedule
by way of an amendment and cannot remove any categories of employees provided
in the said Schedule.
d. Fixed-term employees:
The SS Code defines a ‘fixed-term employment arrangement’ as one where an
employee is engaged on the basis of a written contract of employment for a fixed
period provided all benefits extended to permanent workers (such as hours of work,
wages, allowances and other benefits) doing the same work or work of a similar
nature, are made available to such fixed-term employees as well, for the period that
such person is employed.
e. Gig Workers:
The definition of ‘gig workers’ includes any person who (i) performs work or
participates in a work arrangement, and (ii) earns from such activities, outside of a
traditional employer-employee relationship. The definition indicates that gig work
is a category outside the typical employee- employer framework.
f. Platform Workers:
Platform workers includes those persons who have entered into a work
arrangement outside the traditional employer-employee relationship, and who
access organisations or individuals through an online platform and provide services
or solve specific problems or provide specific services, in lieu of payment.
g. Home-based workers:
Page | 44
The definition of ‘home-based workers’ include
persons engaged in the production of goods or services for an employer at
home or any other premises, other than the workplace of
the employer, for remuneration. Home- based workers are covered within the
definition of unorganised workers and consequently, benefits extended to
unorganised workers, will be applicable to home-based workers under the SS Code.
h. Inter-state migrant workers:

The definition of an ‘inter-state migrant worker’ under the SS Code is the same as
the definition in the other Labour Codes.
i. Self-Employed Worker:
The definition of ‘self-employed worker’ includes any person, who is not employed
by an employer, but is engaged in any occupation in the unorganised sector subject
to a monthly ceiling on earnings, as may be prescribed by the Central Government.
j. Wage worker:
The definition of ‘wage worker’ includes persons employed for remuneration in the
unorganised sector. The following are the features of a wage worker:
• Wage worker may be directly employed by an employer or by a contractor;
• The place of work is immaterial;
• A wage worker could be employed exclusively for one employer or for many
employers;
• Remuneration may be made in cash or in kind;
• Wage worker includes a home-based worker, a temporary or casual worker, a
migrant worker, or workers employed by households including domestic workers;
and
• Wage worker is a person who earns monthly wages as may be notified
by the Central Government and the State Government, as the case may be.
k. Unorganised workers:
The SS Code defines an ‘unorganised worker’ to mean a home-based worker, self-
employed worker or a wage worker in the unorganised sector and includes any
worker in the organised sector, who is not covered by the Industrial Disputes Act,
1947 or under Chapter III (PF) and Chapter IV (ESI) of the SS Code.
iii. Wages
The definition of the term ‘wages’ under the SS Code is aligned with the other
Labour Codes.
Wage = salaries, expressed in monetary terms, which includes basic wages,
dearness allowance and retaining allowance.
Page | 45
It is an exhaustive definition, which also provides a list of exclusions like other
labour codes.
In an important proviso to the above mentioned exclusion, the SS Code provides
that if the aggregate amount of the exclusions specified in points exceeds 50% (or
such a notified percentage) of the total remuneration payable to the employee, the
amount in excess of the said threshold, will be deemed as remuneration and be
added to wages, a concept that has been reflected in the Wage Code as well.
Further, if any part of the remuneration is given in kind then the value of the said
remuneration, which does not exceed 15% of the total wages payable to the
employee, will also form part of the employee’s wages.
iv. ‘Employer’ and ‘contractor’

The SS Code has expanded the definition of ‘employer’ to cover contractors and legal
representatives of a deceased employer. Additionally, the definition also clarifies
that the head of department, occupier/ manager of the factory, or person having
ultimate control over the affairs of the establishment (where such affairs are
entrusted to a manager or managing director, such manager or managing director)
are all covered within the ambit of the term employer.
Under the SS Code, the definition of contractor is the same as contained in the other
Labour Codes, and in relation to an establishment.
v. Aggregator
Aggregator is a digital intermediary or a marketplace for a buyer or user of a service
to connect with the seller or the service provider. An aggregator is given certain
responsibilities and obligations on funding social security benefits to their workers.
vi. Appropriate Government

same as other codes.
B. Registration under the SS Code

Registration is mandatory and can be done electronically. Also, if any establishment
is already registered under any other central labour law, it does not have to obtain
registration under the SS Code again. Such an existing registration will be deemed
registration under the SS Code.
SS Code also mandates Aadhaar-based registration for all categories of workers.
C. Provident Fund (PF)
i. Applicability of the chapter on PF

Chapter III of the SS Code deals with employees’ provident fund.
Earlier- PF benefits Now- all establishments in which 20 or more
were applicable only to employees are employed.
Page | 46
scheduled or notified
establishments under Establishments not statutorily required to
EPF Act contribute to EPF can also apply for coverage
if there is an agreement between employer
and majority of its employees.
Exempted establishments:-
• Certain establishments registered under legislations relating to cooperative
societies, or
• Certain establishments belonging to, under the control of or set up by any law
of the Central or State Government, or
• employees who immediately before the enactment of the SS Code were
receiving provident fund benefits under any Central or State enactment,
• The SS Code also permits the Central Government to exempt establishments
from its applicability on the basis of their financial position or other relevant
circumstances.
Existing schemes to continue for one year from the date of commencements of the
SS code, if they are not inconsistent with the provisions of SS code. For example –
schemes existing under the EPF Act such as the Employees’ Provident Funds
Scheme, 1952 and the Employees’ Pension Scheme, 1995 etc.
The Central Government has been granted authority to frame schemes for the
governance of provident fund entitlement of employees or a class of employees and
to specify the establishments or class of establishments to which PF benefits under
the SS Code will apply.
Additionally, the Central Government, may by notification, frame an employees’
pension scheme to govern inter alia superannuation pension, nominee pension,
widow or widower’s pension etc.
For providing life insurance benefits to the employees of any establishment or class
of establishments governed by the chapter on PF in the SS Code, an ‘employees’
deposit linked insurance scheme may be framed by the Central Government. The
matters that the abovementioned schemes on provident fund, pension and
insurance may provide for, have been identified in the Fifth
Schedule to the SS Code. The Central Government has been vested with the
authority to frame schemes for the purpose of providing social security benefits to
‘self- employed’ workers or ‘any other class of persons’, thereby ensuring that any
and all categories of workers may avail social security benefits under the SS Code.
ii. Quantum of contributions

The employer and employee have to make matching contribution at the rate of 10%
of the employee’s wages (12% in case of establishments notified by the Central
Page | 47
Government), to a provident fund established by the Central Government for this
purpose.
Central Government is empowered to specify rates of employees’ contribution after
making inquiries. Employees can make higher contribution too but employer is not
obliged to match that.
For contract employees: Principal employers can recover any provident fund
contributions remitted in respect of employees of contractors, including any
administrative charges, from the said contractor. International workers are not
specifically mentioned in the SS Code.
With regard to pension, an employer’s contribution in respect of an employee who is
a member of a pension fund established by the Central Government;
• shall not exceed 8.33% of the employer’s PF contribution;
• may be specified in the pension scheme formulated, by the employers of
exempted establishments; and
• be such sums as may be specified by the Central Government after due
appropriation by the Parliament.
In relation to the insurance scheme, the Central Government has been empowered
to establish a deposit-linked insurance fund (EDLI Fund). The employer will pay into
such an EDLI Fund an amount not exceeding 1% of the wages or such percentage of
wages of covered employees as may be notified by the Central Government.
Employers will also be required to pay into the aforementioned EDLI Fund, any such
further sums of money not exceeding one-fourth of the abovementioned
contribution, as the Central Government may, from time to time, determine to meet
all expenses in connection with the administration of the insurance scheme.
D. Employees’ State Insurance (ESI)
i. Applicability of the chapter on ESI

The chapter on ESI is applicable to every establishment (other than a seasonal
factory) in which 10 or more persons are employed.
Employers having less than 10 workers can opt for voluntary coverage if there is an
agreement between an employer and a majority of its employees.
The SS Code expands the applicability of ESI benefits to all establishments, as
opposed to scheduled or notified establishments under the current ESI Act.
The chapter on ESI is also applicable to an establishment carrying out hazardous or
life-threatening occupation as notified by the Central Government, irrespective of
the number of persons employed in such an establishment thereby, increasing the
onus on employers in hazardous occupations to protect their workers.
With regard to plantations, employers can opt for coverage under the SS Code for
the purposes of ESI, provided employees continue to receive more beneficial terms,
if they are so entitled.
Page | 48
ii. Benefits
The rate at which the ESI contributions (both employer and employees’ share) will
be payable under the SS Code, will be prescribed by the Central Government. In
addition to the various benefits available under the aegis of the ESI chapter of the SS
Code, including inter alia sickness benefit, maternity benefit, disablement benefit
etc., the Employees’ State Insurance Corporation (ESIC) has been vested with
powers to promote other measures for the health and welfare of covered persons. If
employer fails/neglects/delays insuring its worker then ESIC can recover the
capitalised value of the benefit payable to the employee, after giving a chance of
being heard.
The onus is on the employer to ensure that all employees of covered establishments
under the SS Code, are insured.
E. Gratuity
i. Applicability of the chapter on gratuity

Applicable to every factory, mine, oilfield, plantation, port, railway company and to
every shop or establishment employing 10 or more employees on any day in the
preceding 12 months or to every shop and establishment so notified by the
appropriate Government from time to time.
ii. Eligibility for gratuity

Similar to the POGA, gratuity is payable to employees at the time of termination of
their employment, provided they have rendered continuous service for a period of
five years, except if such termination of employment is due to death, disablement,
expiration of a fixed-term employment, or on the happening of any such event as
may be notified by the Central Government.
The SS Code has extended the benefit of gratuity to fixed-term employees,
irrespective of the duration of their employment.
‘Working journalists’ as defined under the Working Journalists and Other
Newspaper Employees (Conditions of Service) and Miscellaneous Provisions Act,
1955, will be entitled to gratuity after rendering three years of continuous service.
iii. Calculation of gratuity
The formulae for calculation of gratuity remains similar to the one provided for
under the POGA i.e. 15 days’ wages (or such number of days as may be notified
by the Central Government) for every completed year of service, based on the rate of
wages last drawn by the employee concerned, subject to a ceiling to be prescribed by
the Central Government.
The SS Code further clarifies that for fixed-term employees or deceased
employees, gratuity is payable on a pro rata basis.
F. Maternity Benefit
Page | 49
i. Applicability
Maternity Benefit is applicable to every establishment that is a factory, mine or
plantation including any such establishment belonging to the Government, and to
every shop and establishment in which 10 or more employees are employed or were
employed on any day of the preceding twelve months, and to such other shops and
establishments as may be notified by the appropriate Government from time to
time.
ii. Prohibition of Employment

The SS Code prohibits the employment of any woman in any establishment, during
the six weeks immediately following the day of her delivery, miscarriage, or medical
termination of pregnancy. prohibit the employer, on a request being made by the
woman in this behalf, to require her to do any work which is of the nature specified
therein, during the period of one month immediately preceding the afore mentioned
period of six weeks, or during the said period of six weeks for which the pregnant
woman does not avail of leave of absence.
iii. Benefits-→
• A woman shall be entitled to maternity benefit if she has actually worked for a
period of not less than eighty (80) days in the twelve (12) months immediately
preceding the date of her expected delivery.
• Similar to the MB Act, the SS Code confers on every woman the right to
receive maternity benefit and prescribes 26 weeks as the maximum period for
which any woman would be entitled to maternity benefit.
• A woman who legally adopts a child below the age of three months or a
commissioning mother shall be entitled to maternity benefit for a period of
twelve weeks.
• It also provides that in case the work assigned to a woman is of such nature
that she may work from home, the employer may allow her to do so after
availing of the maternity benefit for such period and on such conditions as the
employer and the woman may mutually agree.
• Every woman who is entitled to maternity benefit is also entitled to
medical bonus amounting to INR 3,500, where pre-natal confinement and
post-natal care is not provided by an employer, free of charge . The amount of
medical bonus can be modified by the Central Government by way of a
notification, and while the MB Act imposed an upper ceiling of INR 20,000 on
such a notified amount of medical bonus, which could be revisited by the
Government every three years only, the SS Code does not prescribe any upper
Page | 50
limit to such a modified amount, nor does it prescribe a period of three years
for revisiting the amount of medical bonus payable.
• Common creche facilities:- While the requirement to provide creche facilities
continues to apply to establishments having 50 or more employees (4 visits a
day to the creche allowed), the SS Code allows an establishment to now avail a
common creche facility of the Central Government, State Government,
municipality, private entity or of a non-governmental organisation or of any
other organisation.
• A group of establishments can now pool their resources for setting up of a
common creche in a manner agreeable to the establishments concerned.
G. Employees’ Compensation
i. Applicability
Similar to the ECA, the provisions pertaining to employees’ compensation are
applicable to every person employed in the scheduled categories including inter alia
persons employed in railways, mines etc. or to those employed in categories that
may be further notified by the Central Government, for this purpose. Employers and
employees who are covered under ESI are excluded from the applicability of
provisions on employees’ compensation.
ii. Notice of accident

An employer is required to give notice to the competent authority of any accident
occurring in the employer’s premises within seven days of such accident that
results in death or serious bodily injury.
iii. Compensation
An employer will be liable to pay compensation to employees if any injury is caused
to them due to an accident or occupational disease (as defined in the Third Schedule
of the SS Code). However, employers will not be required to pay any compensation
in the following circumstances;
• If the injury does not lead to total or partial disablement for more than three
days,
• If the injury does not lead to death or permanent disablement, and was caused
when the employee was under the influence of drugs,
• If the injury was caused to employee in wilful disobedience of on order, or
• If the injury was caused as a consequence of wilful removal or disregard of
safety gear.
Page | 51
The SS Code also deems certain accidents or occupational diseases as specified in
the Third Schedule to be necessarily arising in the course of employment.
Appropriate Government can only make additions to the Third Schedule by way of
amendment and cannot remove any categories of accidents or occupational
diseases, provided in the said Schedule.
Further, the SS Code clarifies that any accident that occurs to an employee while
commuting from the residence to workplace or vice versa, will be deemed to be in
the course of employment.
The amount of compensation payable when:
a. An injury results in death is 50% of the monthly wages of the deceased

employee multiplied by the relevant factor. The current ceiling of INR 1,20,000 is
removed under the SS Code;
b. An injury results in permanent disablement is 60% of the monthly wages

of the employee multiplied by the relevant factor. The current ceiling of INR
1,40,000 is removed under the SS Code;
c. For partial disablement, either 60% or in proportion to the loss in earning

capacity, as applicable, and
d. For temporary disablement, half monthly payment equal to 25% of the

monthly wages of the employee.
The State Government is responsible for
appointing a competent authority who will be responsible for determining the
compensation payable by an employer.
The SS Code provides for an increase in certain amounts payable towards
employee’s compensation, for instance, funeral expenses to be provided under the
SS Code have been increased to INR 15,000 from the existing INR 5,000 under the
ECA.
H. Social Security and Cess in Respect of Building and Construction Workers
(BOCW)
i. Applicability
The provisions relating to social security for BOCW in Chapter VIII of the SS Code
are applicable to every establishment which performs activities that fall under
the definition of building and other construction work under the SS Code. For this
purpose, building and construction work does not include any building or other
construction work which is related to any factory or mine or any building or other
construction work employing less than 10 workers or where such work is related to
own residential purposes of an individual or group of individuals for their own
residence and the total cost of such work does not exceed INR 50,00000 or such
Page | 52
higher amount and employing more than such number of workers as may be
notified by the appropriate Government. Further, every BOCW is required to
register with the Building Workers’ Welfare Board (BOCW Board) as a beneficiary,
upon completion of 18 years of age.
ii. Benefits available to BOCW

SS Code mandates the setting up of the Building and Other Construction ‘Workers’
Welfare Fund to which the cess so levied will be credited.
The SS Code permits the levy of cess for the purpose of social security of BOCW at
the rate of 1-2%, as may be notified by the Central Government. The cess so levied is
to be collected and deposited with the local authority as prescribed by the State
Government to the BOCW Board, in a manner as may be prescribed by the Central
Government in this regard.
I. Social Security for Unorganised, Gig and Platform Workers

Part of India’s freelance workforce or the informal sector and heve remained outside
the purview of employee benefits. The Central Government must enact social
security and welfare schemes.
A brief overview of the social security benefits that the Central Government must
extend to such unorganised workers and may extend to gig and platform workers is
as follows.
i. Applicability
The provisions relating to social security in Chapter IX of the SS Code
are applicable to the unorganised sector i.e., to unorganised workers, gig
and platform workers. Further, every unorganised worker, gig and
platform worker has to be registered as per the provisions of the SS
Code and is required to submit his/her Aadhar card to avail the benefit
of any schemes under the SS Code.
ii. Benefits
Schemes for gig and platform workers
The SS Code allows the Central Government to launch schemes for gig
and platform workers on matters relating to (i) life and disability cover,
(ii) accident insurance (iii) health and maternity benefits, (iv) old age
protection, (v) creche, and (vi) other benefits as determined by the
Central Government.
The SS Code further states that in addition to unorganised workers, the
National Social Security Board may also act as the board for the
purposes of welfare of gig workers and platform workers and can
recommend and monitor schemes for gig workers and platform
workers.
Page | 53
The SS Code envisages setting up of the Gig and Platform Workers’
Social Security Fund (Gig and Platform Workers’ Fund), to provide social
security and welfare benefits to the gig and platform workers. The Gig
and Platform Workers’ Fund will be set up and administered by the
Central Government and will be funded by a combination of
contributions from the Central Government, State Governments, and
scheduled aggregators specified under the SS Code.
This scheme by the State Government may be funded by the State
Government, contributions from beneficiaries, and by corporate social
responsibility funds defined under the Companies Act, 2013.
For this purpose, scheduled aggregators include those involved in inter
alia ride sharing services, food and grocery delivery services, content
and media services, and e-marketplaces. The contribution from an
aggregator has to be at a rate specified by the Central Government,
between 1-2% of the annual turnover of the aggregators. However, such
contribution cannot exceed 5% of the amount paid or payable by an
aggregator to gig workers and platform workers.
Schemes for unorganised workers

Further, the SS Code mandates the Central Government to launch
schemes for unorganised workers on matters relating to (i) life and
disability cover, (ii) health and maternity benefits, (iii) old age
protection, (iv) education, and (v) other benefits as determined by the
Central Government. These schemes may be partly funded by Central
Government, State Government, contributions by beneficiaries of the
scheme and its employers, and by corporate social responsibility funds
defined under the Companies Act, 2013.
The State Government has the responsibility to formulate suitable

welfare schemes for unorganised workers, for (i) provident fund, (ii)
employment injury benefit, (iii) housing, (iv) educational schemes for
children, (v) skill upgradation schemes for workers, (vi) funeral
assistance, and (vii) old age homes.
These State Government schemes too may be funded by the State

Government, contributions from beneficiaries, and by corporate social
responsibility funds defined under the Companies Act, 2013.
J. Employment Information and Monitoring

Appropriate Government may require employers to report vacancies to career
centres (similar to the current employment exchanges), as notified. However, the SS
Code does not impose an obligation on the employer to recruit persons from the
Page | 54
career centre. Further, these provisions will not apply to vacancies in employment
in agriculture, domestic service, staff of Parliament or State, or whose duration is
less than 90 days or to any establishment with less than 20 employees.
Furthermore, the vacancies which are proposed to be filled through promotion or
absorption in recruitment agencies such as the Union Public Service Commission,
Staff Selection Commission or a State Public Service Commission are also outside
the purview of such vacancy reporting requirements, under the SS Code.
K. Penalties and Offences Enhanced Penalties

While laying down uniform penalties for non- compliance with social security-
related obligations, the SS Code enhances the penalties for offences committed
thereunder, adding to their deterrence value. Given below is an overview of the
penalties envisioned under the SS Code.
Page | 55
H. Other Salient Features
i. Emphasis on ensuring compliance and not on penalizing an employer

The thrust of the SS Code is to ensure compliance and it introduces various
measures to achieve this objective:
a. Inspector-cum-Facilitator
The SS Code provides for the appointment of an Inspector-cum-Facilitator, whose
role is enlarged to encompass not just inspection but also to supply information and
sensitise employers and workers of the provisions of the SS Code and compliance
therewith.
b. Inspection
The Central Government (as the case may be) or the appropriate Government is
empowered to frame an inspection scheme that may provision for web-based
information and calling for information electronically as well as assign duties to
carry out such inspections based on a random selection.
c. Prior opportunity to rectify

The SS Code permits the employer to rectify any non-compliances under certain
circumstances, and further restricts the Inspector-cum-Facilitator from initiating
action unless the employer has been given such an opportunity to rectify the non-
compliance within a stipulated period, from the date of notice giving such
opportunity. However, the employer would be disqualified from availing such an
opportunity if it subsequently indulges in similar violation within a period of 3
years.
d. Compounding of offences
It provides for compounding of certain offences either before or after an enquiry is
held or prosecution is initiated in a prescribed manner, by paying
• 50% of the maximum penalty in case of a penalty, and
• 75% of the maximum fine in case of an offence.
Compounding is not available for the offence committed the second or subsequent
time within a period of 3years from the date of either: (i) commission of a similar
offence which was earlier compounded; or (ii) commission of a similar offence for
which conviction order has been passed.
ii. Maintenance of registers and records

By consolidating the various registers and records, and permitting the maintenance
of the same electronically, the SS Code offers substantial relief to employers.
Page | 56
Returns may also be filed electronically. It recognises the issuance of wage slips in
electronic format to the employees.
iii. Introduction of limitation period for inquiry

With regard to disputes regarding the applicability of the chapters on employees’ PF
and ESI and in relation to any dues payable under the aforementioned chapters, the
SS Code lays down that no inquiry may be undertaken by a relevant authority after
the expiry of 5 years from the date on which such a dispute would have arisen or
amounts are alleged to be due from an employer.
Such inquiries will be completed within 2 years, which may be extended for a
further period of maximum 1 year.
iv. Exemptions under the SS Code

Any exemption provided by appropriate Government will initially be operational for
3 years unless extended for further period as prescribed by central government.
v. Misuse of benefits
Currently, the ESI Act provides that if the Central Government finds any insured
person in a factory or establishment to be misusing the benefits under the ESI Act,
the Government can disentitle such a person from availing benefits under the ESI
Act. This power to deprive persons or establishments who misuse any social
security benefits provided to them under the SS Code, has now been extended to all
benefits under the SS Code and the appropriate Government -- after giving
reasonable opportunity to such persons of being heard--- under which such
establishment or persons can be deprived from availing benefits under the SS Code
by way of a notification.
vi. Appeals/disputes to be accompanied by prior deposit

Under the SS Code, in order to raise disputes before authorities such as the
Employees’ Insurance Court or to appeals to tribunals with regard to determination
and assessment of PF dues, an employer must deposit a certain percentage of the
amount claimed before the concerned social security organisation or the court, as
the case may be.
vii. Social Security Organisations

The SS Code also provides for the setting up of different statutory bodies to
administer and regulate social security schemes formulated thereunder.
These include
(i) a Central Board of Trustees, to be headed by the Central Provident Fund
Commissioner, to administer the schemes formulated with regard to
employees’ PF, pension and employees’ deposit linked insurance (this will
Page | 57
be a body corporate of trustees, to replace the existing Employees’
Provident Fund Organisation);
(ii) the ESIC to administer a scheme for the regulation of ESI benefits and
(iii) state-level BOCW Boards to administer schemes for building workers.
Further, a completely new set of authorities in the form of
(i) National and State Social Security Boards headed by the Central and State
ministers for labour and employment, respectively, to administer schemes
for unorganised workers including gig and platform workers; and
(ii) The State Unorganised Workers’ Social Security Board,
may be constituted.
viii. Establishment of a social security fund
To ensure that benefits to gig, platform and unorganised workers are provisioned
for and for implementation of schemes framed in this regard, the SS Code requires
the Central Government to establish a social security fund and maintain separate
accounts in relation thereto.
ix. Powers during an epidemic, pandemic or disaster

For expedited passing of rules, regulations and schemes in relation to the provisions
of the SS Code, except those pertaining to the chapter on PF, while in every other
circumstance any such rules, regulations or schemes to be promulgated under the
SS Code are to be published in the Official Gazette as general information, for at
least 45 days, the Central Government may dispense with this requirement of
previous publication in case of an epidemic, pandemic or disaster.
Additionally, the SS Code empowers the Central government to defer or reduce the
employer and/or employee’s contribution towards PF and ESI, for a period of up to
three months at a time, in the event of a pandemic, epidemic or national disaster.
x. Prioritising employees’ dues

In the event of an employer becoming insolvent under the Insolvency and
Bankruptcy SS Code, 2016 (IBC), the SS Code provides that any dues payable to
employees towards inter alia PF, ESI, gratuity, maternity benefit etc., will be paid in
priority in accordance with the provisions of the IBC.
xi. Overriding effect

The provisions of the SS Code shall have effect notwithstanding anything
inconsistent therewith contained in any other law for the time being in force. Under
the Insolvency and Bankruptcy SS Code, 2016 (IBC), the SS Code provides that any
dues payable to employees towards inter alia PF, ESI, gratuity, maternity benefit
etc., will be paid in priority in accordance with the provisions of the IBC.
Page | 58
Page | 59

1628151647792industrial Relations and Labour Law

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

1628151647792industrial Relations and Labour Law

Uploaded by

Copyright:

Available Formats

FOR UPSC EPFO EXAM

Organisation consists of group of people coming together to achieve common

Industrial Relation: Definitions, Scope, Objectives, Types & Characteristics

According to V. Agnihotri, “The term industrial relations explains the relationship

Industrial Relations – Scope

Parties involved in Industrial relations.

Factors affecting Industrial relations are: -

2. Economic Factors: Under economic factors are included economic

4. Technological Factors: Under technological factors fall items like work

5. Psychological Factors: Under psychological factors fall items pertaining to

6. Political Factors: The political factors are political institutions, system of

8. Political Parties: Political parties influence government to formulate labour

9. Enterprise-Related Factors: It includes issues like style of management

11. International Relations: Good relations between countries facilitate movement

Approaches to Industrial Relations – Theoretical Approaches to Industrial

The System Approach

According to Prof. J. P. Dunlop, “An industrial relations framework is designed to be

Oxford Approach = study of job regulations

Flanders is the exponent of this approach. Job regulation can be categorised as

The Industrial Sociology Approach

According to G. Margerison, the core of industrial relations is the nature and

The Social Action Model

Origin in Weberian sociology: This approach attempts to study the behavioural

The Psychological Approach= problem due to perceptions of management, unions

Human Relation Approach (Keith Davis)

d. Psychological Needs – Needs for security from life hazards and

The Gandhian Approach

Gandhiji advocated peaceful co-existence of capital and labour. He believed in trust,

a. Workers should seek redressal of reasonable demands only through

EVOLUTION OF INDUSTRIAL RELATION (IR)

1. With changing socio-economic context, IR also changes. At global level, Initial

1948 Industrial Policy Resolution was prepared

1950 First five year plan: recognised dignity of labour. Workers

1958 Code of Discipline of Industries (NOT a legal document)

Follows Gandhi’s philosophy and aims to build industrial

1960 Political and economic forces aggravated industrial

1980 Tripartism was revived as suggested by Several

CONSTITUTIONAL PROVISIONS IN INDUSTRIAL RELATIONS

➢ Articles 39: state shall secure:

d. Labour = concurrent subject

Section 2(z): Definition of worker includes:

The State Advisory Board would consist of following persons:

INDUSTRIAL RELATIONS CODE, 2020

The scope of the all remuneration by way of salaries, expressed in

What are excluded a. Statutory Bonus,

iv. ‘Trade Union Dispute’

Under previous act Under new code

Strike and notice of strike workers employed in an industrial

reference of by the appropriate any concerned party may make an application

Grievance not mandatory if mandatory even if the employer has an

• Offences punishable with fine only • 50% of the

• Offences punishable with imprisonment • 75% of the

B. Registration of Establishments and Closure Requirements

E. Provisions Relating to Contract Labour

• To ensure access to healthcare;

h. Inter-state migrant workers:

iv. ‘Employer’ and ‘contractor’

vi. Appropriate Government

B. Registration under the SS Code

C. Provident Fund (PF)

i. Applicability of the chapter on PF

ii. Quantum of contributions

D. Employees’ State Insurance (ESI)