Awareness of labour laws at

shop-floor level in SMEs

• SMEs have important role to play in the growth of
Indian economy.
• SME units would be able to focus on business and
avoid labour problems only when there is good
understanding of the existing labour laws among the
workers as well as the employers.
• The ever-changing scenario of the social, economic
and political environment, make the legal framework
complex and very dynamic.

With a tremendous focus on manufacturing quality
bearings and restrains on cost, ARB Bearings Ltd. is
among India's prominent engineering companies.

Shakti was started in 1982 with a trading house of
minerals in Delhi. This was followed by a period of
sustained expansion, diversification and growth.

It is one of the well-known manufacturer and supplier of
a huge array of Outdoor and Indoor Advertising,
Promotional Items and Exhibition Material.

It was founded in 2000 in Rohtak, when manufacturing
of polypropylene woven circular sacks just started in
India. It’s a manufacturer and exporter of much kind of
yarns and threads and fancy laces. They export their
finished products mainly to USA and Canada.

.OBJECTIVES • Gauging the level of awareness of the labour laws among the workers of SMEs. • To study the benefits extracted by the workers from the existing legal framework governing labour. • The project also aims at finding out the level of satisfaction of the workers on the basis of benefits provided by the employers. employment and social security.

of Questions: 15 • SECONDARY DATA: Official websites of the organizations • SAMPLE SPACE: 100 workers/labours of 4 SMEs .RESEARCH METHODOLGY • PRIMARY DATA: o Close-ended questionnaire o No.


Are you a Contractual.1. Temporary or Permanent worker? 40 35 30 NO. OF RESPONSES 25 Contractu al 20 Perm anen t 12% 15 10 88% 5 0 COMPANY .

COMPANY CONTRACTUAL TEMPORARY PERMANENT ARB Bearings 3 0 37 SR Creations 0 0 20 Chirag Marketing 3 0 12 Shakti Minerals 6 0 19 .

ANALYSIS • Survey shows that there were majorly two classes of workers. • Main reason of having contract labours was meeting the rise in demand. • There might be a possibility that some temporary workers were told that they were permanent but were actually not legally documented(temporary). .contractual and permanent.

. of respondants. More than 8 hrs. More than 8 hrs.2. How many hours do you work in a day? 40 COMPANY 8 hrs. 15 10 5 0 34% 66% Com panies 8 Hrs. 15 0 Shakti Minerals 6 19 35 30 25 20 No. ARB Bearings 13 27 SR Creations 0 20 Chirag Mktg.

a worker cannot be employed for more than 48 hours in a week and the total period of work inclusive of rest interval cannot be more than 10.ANALYSIS • 66% of workers said they work for more than 8 hours in a day. • According to the Factories Act. . • It can adversely hamper their productivity due to the imbalance between personal and working life.5 hours.1948 (Section 51).

0 15 Shakti Minerals 17 8 40 35 30 25 20 No.of respondants 15 10 5 0 40% Com panies 60% yes no .3. Do you get proper overtime benefits? COMPANY YES NO ARB Bearings 32 8 SR Creations 11 9 Chirag Mktg.

overtime wages being paid should be double the rate of wages. and they are satisfied just because they are being paid more for the overtime.ANALYSIS • 60% of the workers said they were paid overtime benefits. the Act states that the total working hours including overtime should not exceed 60 in a week and total overtime hours in a quarter should not exceed 50. if a worker works beyond 9 hours a day or 48 hours a week.1948 (Section 51). • Also. there might be a possibility for that the companies are not paying according to this law and the workers are unaware of this. However. . We cannot comment how many workers are aware of this law. • According to the Factories Act.

10 5 Shakti Minerals 17 8 20 No. 15 10 5 0 55% Com panies 45% YES NO . of respondants.4. Does your employer pay bonuses regularly? COMPANY YES 40 35 30 25 NO ARB Bearings 11 29 SR Creations 7 13 Chirag Mktg.

1956. supervisory etc. managerial. and engaged in any kind of work whether skilled. 10.000 p. 1965 states that Every employee receiving salary or wages up to Rs. . is entitled to bonus for every accounting year who has worked for not less than 30 days in that year.ANALYSIS • 45% of the workers said they were paid bonuses regularly.m. • There might be a possibility that rest 55% were not satisfied with the amount of bonuses being paid or were unaware about the provisions of the Payment of Bonus Act. • The Payment of Bonus Act. unskilled.

of respondants 15 10 5 s . Did you get proper training regarding safety precautions to be followed while COMPANY YES NO performing the job? 40 35 30 ARB Bearings 31 9 SR Creations 18 2 Chirag Mktg.5. 0 15 Shakti Minerals 25 0 25 20 No. iM in er al M kt g g 26% Sh a kt ra Ch i at Cr e SR A RB Be a ri io ng ns s 0 Com panies 74% .

ANALYSIS • 81% of the workers were aware about whom to contact in case of any grievance. • Rest 19% of the workers might be new to the organizations and were not clear about the redressal process. • This shows that grievance handling is given due importance by the employers in recent times. .

Do you know whom to contact in case of any problem or grievances? 40 35 30 COMPANY YES NO ARB Bearings 30 10 SR Creations 11 9 Chirag Mktg. of respondents 20 15 10 YES NO 5 0 ARB Bearings Company 19% 81% .6. 15 0 Shakti Minerals 25 0 25 No.

ANALYSIS • 74% of the workers said they were given the training regarding safety precautions. • This shows that safety of the workers is duly taken care of and considered important for the organization’s productivity. . lay down the rules for the purpose of securing the safety of workers. 1948 (Section21-41). For example. section 22 states about the work on or near machinery in motion. • The Factories Act.

15 0 Shakti Minerals 23 2 35 30 25 20 No. Do you get proper medical leave and benefits? COMPANY YES NO 40 ARB Bearings 35 5 SR Creations 20 0 Chirag Mktg.7. of respondants 15 10 5 0 7% 93% Com panies YES NO .

and maternity benefits in case of women employees. .ANALYSIS • 93% of the sample said they are getting adequate medical leaves and benefits by their employers. most of the SMEs have tie ups with dispensaries and hospitals to provide cash less service to their employees. The employees registered under the scheme are entitled to medical treatment for themselves and their dependents. • Today. • According to Employees’ state Insurance Act. insured persons and their families are entitled to medical and cash benefits. 1948.

N/A N/A Shakti Minerals N/A N/A 35 30 25 20 15 10 N/A NO Y ES 5 0 Y es No N/A .8. Do you get proper maternity leave and benefits? COMPANY YES NO 40 ARB Bearings N/A N/A SR Creations N/A N/A Chirag Mktg.

ANALYSIS • Data from all organizations indicate that the maternity policies/benefits are not applicable in any of them. This is because neither of the organizations had female workers at the shop floor level. • The organizations need to maintain an optimum level of gender diversity among workers in order to set up a healthy work environment. .

9. 0 15 Shakti Minerals 25 0 30 25 20 No. Do you get proper compensation and treatment in case of a mishap? 40 COMPANY YES NO 35 ARB Bearings 36 4 SR Creations 4 16 Chirag Mktg. of respondants 15 10 5 0 35% 65% Com panies YES NO .

• Workmen’s Compensation Act. 1923 was enacted to help workmen face the hardships resulting from accidents.ANALYSIS • 65% of the workers under study responded that proper compensation in case of any casualty occurring at the workplace is provided to the workers while some of the workers under 35% said that the compensation was not in proportion with the level of injury happened and others said it was totally in incongruity with the extent of the mishap happened. .

Is there a trade union in your organization? 40 COMPANY YES NO ARB Bearings 40 0 SR Creations 13 7 Chirag Mktg.10. 0 15 Shakti Minerals 0 35 30 25 20 NO. OF RESPONSES 15 No Yes 10 5 25 0 22% COMPANY 78% Yes No .

registration of a trade union is not compulsory but is desirable. • According to The Trade Unions Act. 1926. . • One of the four SMEs did not have any Trade union but there was a single representative for the workers.ANALYSIS • 78% of the workers said they had Trade Union in their respective organizations.

OF RESPONSES COMPANY YES NO ARB Bearings 39 1 30 SR Creations 8 12 25 Chirag Mktg. Have there been any strikes/lockouts in your factory? 40 35 NO.11. 0 15 20 Shakti Minerals 11 15 No Yes 14 10 5 0 39% 61% Y es No COMPANY .

ANALYSIS • According to 61% workers. Lockout.“work stoppage initiated by an employer” • In SR Creations. • In Shakti Minerals. the discrepancy in their responses. workers were unaware of what constitutes a strike and hence. . strikes/lockouts in the factory. there had been • Strike – “Work stoppage initiated by employees”. all the new employees answered in negation implying that there has been no strikes/lockouts in the past 7-8 years and hence a positive development.

0 0 15 Shakti Minerals 12 2 11 35 30 25 20 NO. OF RESPONSES 15 10 5 0 39% 28% Y es COMPANY 33% No N/A . Were the strikes resolved in full consent to workers and management? 40 COMPANY YES NO N/A ARB Bearings 8 31 1 SR Creations 8 0 12 Chirag Mktg.12.

strikes were resolved in full consent to workers. • Section 22 of Industrial Dispute Act. • The rest 54% were not satisfied with the way the issues were resolved esp. in Shakti Minerals. almost all the employees were satisfied with the results thereby. 1947 lays down conditions and provisions to be followed before carrying out a strike/lockout.ANALYSIS • According to 46% workers. . in ARB Bearings Ltd. preventing them to occur in the future. • However.

OF RESPONSES 15 No 10 Y es 0 5 0 37 % 63% Ye s COMPANY No . 0 15 Shakti Minerals 25 20 NO. Do you get proper and healthy food in canteen? 40 35 30 COMPANY YES NO ARB Bearings 34 6 25 SR Creations 3 17 Chirag Mktg.13.

.ANALYSIS • 63% of workers say that they do not get proper healthy food. One of the SMEs under study encountered a strike for this very reason. • As per Factory Act 1948. provision of canteen or a lunchroom with drinking facility should be made for workers. • Adequate and healthy food supply ensures that workers focus on their work and gives them a feeling that employer takes care of them. This figure also includes company where there is no provision of canteen.

0 15 Shakti Minerals 25 0 25 20 No. festivals etc)? 40 35 COMPANY YES NO 30 ARB Bearings 40 0 SR Creations 16 4 Chirag Mktg.14. of Respondents 15 10 5 19% 0 81% Com panies YES NO . Does your factory involve you in other activities(sports.

• Workers at most of the places were given an opportunity to engage in various cultural activities . • Fun at work has become an established and accepted contributor to job satisfaction.ANALYSIS • 81% of total respondents said that their companies involve them in other fun activities. along with task performance and organizational behavior.

15. 10 5 Shakti Minerals 17 8 35 30 No. of respondants 15 10 5 0 55% Com panies 45% yes no . Are you satisfied with your pay? 40 COMPANY YES NO ARB Bearings 11 29 25 SR Creations 7 13 20 Chirag Mktg.

as maximum strikes happen due to the wages.ANALYSIS • 55% of the workers said they were not satisfied with their salaries. . • Employer should take care that wages should be comparable with industries of the similar work.

• Regularly organize ‘Awareness Sessions’ about the policies that exist in the company. • Contributions by Trade Unions. • The organizations need to maintain an optimum level of gender diversity . • Inculcating the culture to follow Labour laws and policies.RECOMMENDATIONS • Proper induction of the workers should be done.

regarding various labor laws and policies pertaining to their benefits. but workers are unaware. .CONCLUSION Following conclusions can be drawn on the basis of our study: • • • • Some policies exist. The level of awareness of laborers on the shop floor. is medium. Certain important policies don’t exist. Workers’ ignorance is management’s advantage.