14 labour legislation

8/10/2019 14 Labour Legislation

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principles o the constitution and or that reason various labor laws have been enacted to

protect the sections o the society!

e" Achieving %ocio &'conomic (rogress#

Labor legislation is one o the most progressive and dynamic instruments or achieving

socio economic progress!

Objectives of Labor Legislation:

To protect the workers rom proit seeking e'ploiters!

To ensure that the service conditions should be clearly spelt out by the employer to

the employee!

To improve and regulate the working conditions o workers employed in dierent

actories and establishments!

To make statutory provision or the regular trainings o a certain number o

apprentices in dierent trades!

To ensure that the employees are paid their wages on i'ed dates and there should be

no deduction made rom the wages!

To promote industrial relations and industrial peace between employers andemployees!

To preserve the health, saety and welare o workers!

To protect the interests o women and children working in the actories!

To maintain the dignity o employees in their organi%ations!

Types of Labor Legislation

") (rotective Labor Legislations:

The legislations whose primary purpose is to protect minimum labor standards and improve

working conditions are protective labor legislations! Legislations laying down the minimum

labor standards in the areas o work, saety, employment o children and women and also

the manner o wage payment come under this category! The Indian labor laws under this

category are#


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The actories (ct, 1.4/,

The 0ines (ct, 1.2,

The 3lantation Labor (ct, 1.1,

The 0otor Transport +orkers (ct, 1.1,

The *hops and $stablishment (ct passed by various states,

The 3ayment o +ages (ct, 1.5,

The 0inimum +ages (ct, 1.4/,

The 6hild Labor 73rohibition and regulation" (ct, 1./ and

6ontract Labor 78egulation and (bolition" (ct, 1.9:!

"") *egulative Legislations:

The legislations whose primary purpose is to regulate the relations between employers and

employees and to provide or methods and manners or settling industrial disputes are

8egulative Legislations! These laws also regulate the relationships between workers and

trade unions, the rights and obligations o the organi%ations o employers and workers, as

well as their mutual relationships! The laws under this category are as ollows#

The Trade ;nions (ct, 1.2,

The Industrial


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(griculture, dairy, horticulture and related occupations alone employ 2 percent o labour in

India! (bout 5: million workers are migrant workers, most in agriculture, and local stable

employment is unavailable or them!

India=s &ational *ample *urvey )ice in its 9th report ound that unorganised

manuacturing, unorganised tradingDretail and unorganised services employed about 1:

percent each o all workers nationwide, as o 2:1:! It also reported that India had about /

million unincorporated non-(griculture enterprises in 2:1:!

In the organised private sector with more than 1: employees per company, the biggest

employers in 2::/ were manuacturing at millionE social services at 2!2 million, which

includes private schools and hospitalsE inance at 1!1 million which includes bank, insurance

and real estateE and agriculture at 1 million! India had more central and state government

employees in 2::/, than employees in all private sector companies combined! I state-

owned companies and municipal government employees were included, India had a 1!/#1ratio between public sector employees and private sector employees! In terms o gender

eBuality in employment, male to emale ratio was #1 in government and government

owned enterprisesE private sector ared better at 5#1 ratio! 6ombined, counting only

companies with more than 1: employees per company, the organised public and private

sector employed ! million women and 22 million men!

?iven its natural rate o population growth and aging characteristics, India is adding about

15 million new workers every year to its labour pool! India=s economy has been adding

about / million new Cobs every year predominantly in low paying, unorganised sector! The

remaining million youth Coining the ranks o poorly paid partial employment, casuallabour pool or temporary inrastructure and real estate construction Cobs, or in many cases,

being unemployed!

Labour relations

(bout 9 per cent o the 4:: million-strong workorce was employed in the ormal sector7comprising government and corporates" in 2::: contributing a whopping : per cent o thenominal ?


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&IT; and T;66! $ach ederation had numerous local trade union ailiates, with thesmallest T;66 with and I&T;6 with 1:4 ailiated unions! >y 1./., >0* hadbecome India=s largest ederation o unions with 5,119 ailiated unions, while I&T;6remained the largest ederation by combined number o members at 2!2 million! The largestederation o trade unions, I&T;6, represents about :!H o India=s labour orce in

organised sector and unorganised sector! In 2:1:, over ./H o Indian workers did notbelong to any trade unions and were not covered by any collective bargaining agreements!

Labour relations during -./01-..0

( number o economists have studied the industrial relations climate in India, with a largenumber o studies ocusing on state-level dierences in India=sIndustrial


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Indian labour laws are considered to be very highly regulated and rigid as compared tothose o other countries in the world! The intensity o these laws have been criticised as thecause o low employment growth, large unorganised sectors, underground economy and lowper capita income! These have led many to demand reorms orLabour market le'ibilityinIndia! India has over : maCor (cts and numerous laws that regulate employers in matters

relating to industrial relations, employee unions as well as who, how and when enterprisescan employ or terminate employment! 0any o these laws survive rom >ritish colonialtimes, while some have been enacted ater India=s independence rom >ritain!

India is a ederal orm o government! Labour is a subCect in the concurrent list o the Indian6onstitution and thereore labour matters are in the Curisdiction o both central and stategovernments! >oth central and state governments have enacted laws on labour relations andemployment issues! *ome o the maCor laws relevant to India are#

Wormen6s $ompensation Act of -.27

The +orkmens 6ompensation (ct compensates a workman or any inCury suered duringthe course o his employment or to his dependents in the case o his death! The (ct providesor the rate at which compensation shall be paid to an employee! This is one o many socialsecurity laws in India!

Trade 3nions Act of -.28

This (ct enacted the rules and protections granted to Trade ;nions in India! This law wasamended in 2::1!

(ayment of Wages Act of -.78

The 3ayment o +ages (ct regulates by when wages shall be distributed to employees bythe employers! The law also provides the ta' withholdings the employer must deduct and

pay to the central or state government beore distributing the wages!"ndustrial 'mployment 9%tanding orders) Act of -.8

This (ct reBuires employers in industrial establishments to deine and post the conditions oemployment by issuing so-called standing orders! These standing orders must be approvedby the government and duly certiied! These orders aim to remove le'ibility rom theemployer in terms o Cob, hours, timing, leave grant, productivity measures and othermatters! The standing orders mandate that the employer classiy its employees, state theshits, payment o wages, rules or vacation, rules or sick leave, holidays, rules ortermination amongst others!

"ndustrial 5isputes Act of -.;

The Industrial


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year with the employer! The employer is reBuired to give notice o termination to theemployee with a copy o the notice to appropriate government oice seeking government=spermission, e'plain valid reasons or termination, and wait or one month beore theemployment can be lawully terminated! The employer may pay ull compensation or onemonth in lieu o the notice! urthermore, employer must pay an eBuivalent to 1 days

average pay or each completed year o employees continuous service! Thus, an employeewho has worked or 4 years in addition to various notices and due process, must be paid aminimum o the employee=s wage eBuivalent to : days beore retrenchment, i thegovernment grants the employer a permission to layo!

4inimum Wages Act of -.O3* "N "N5"A

6hild labouris the practice where children engage in economic activity, on part or ull-timebasis! The practice deprives children o their childhood, and is harmul to their physical and

mental development! 3overty, lack o good schools and growth o inormal economy are

considered as the important causes o child labour in India!

The 6onstitution o India in the undamental 8ights and the


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The 4ines Act of -./2

The (ct prohibits the employment o children below 1/ years o age in a mine!

The $hild Labour 9(rohibition and *egulation) Act of -.


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6hildren who work, instead o going to school, remain illiterate which limits their ability to

contribute to their own well-being as well as to community they live in! 6hild labour has

long term adverse eects or India!

To keep an economy prospering, a vital criteria is to have an educated workorce eBuipped

with relevant skills or the needs o the industries! The young labourers today will be part o

Indias human capital tomorrow! 6hild labour undoubtedly results in a trade-o with human

capital accumulation!

6hild labour in India are employed with the maCority 79:H" in agriculture and the rest in

low-skilled labour-intensive sectors such as sari weaving or as domestic helpers, which

reBuire neither ormal education nor training!

(ccording to the International Labour )rganisation 7IL)", there are tremendous economic

beneits or developing nations by sending children to school instead o work! +ithout

education, children do not gain the necessary skills such as $nglish literacy and technicalaptitude that will increase their productivity to enable them to secure higher-skilled Cobs in

uture with higher wages that will lit them out o poverty!

WO*B4'NC% $O4('N%AT"ON A$T

The +orkmen=s 6ompensation (ct 7(ct III o 1.25" came into orce rom 1st Kuly, 1.24!It applies to the whole o India, including the *tate o Kammu and Fashmir! The (ctprovides or the payment o compensation by certain! 6lasses o employers to theirworkmen, or inCury by accidents!

The +orkmen=s 6ompensation (ct does not apply to actories covered by the

$mployees *tate Insurance (ct!The Amendment of 1.9! The +orkmen=s 6ompensation 7(mendment" (ct, 1.9, was

passed with the obCect o providing suitable scales o compensation or the higher wagelevels beyond 8s!::! The reason is that all wages have been increased! >eore theamendment, the (ct covered workmen whose wages did not e'ceed 8s!:: per month!

5efenses of the 'mployerD3rior to the passing o this (ct, the employer was liable to paycompensation only i he was guilty o negligence! $ven in case o proved negligence, theemployer could get rid o his liability by using any o the ollowing deenses#

-D The 5octrine of Assumed *iss

I the employee knew the nature o the risks he was undertaking when working in aactory, the employer had no liability or inCuries! The court assumed in such case that theworkman had voluntarily accepted the risks incidental to his work! The doctrine ollowedrom the rule Volenti Non Fit Injuria, which means that one, who has volunteered to take arisk o inCury, is not entitled to damages i inCury actually occurs!

2D The 5octrine of $ommon 'mployment

. ;nder this rule, when several 3ersons work together or a common purpose and oneo them is inCured by some act or omission o another, the employer is not liable to pay


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!evi v!"en#al "one ill. >ut &agpur Gigh 6ourt held that the term includes an adoptivewidowed mother!Additional !y. Commissioner, $im%hum v! $mt. &a'hmi%ai Naidu.(

4inorD0inor means a person who has not attained the age o 1/ years!-*ec! 27"!

'mployer! *ec! 27 e" provides that the term $mployer QincludesQ the ollowing# 7i"anybody o persons, whether incorporated or not 7ii" any managing agent o an employer7iii" the legal representatives o a deceased employer, and 7iv" any person to whom theservices o a workman are temporarily lent or let out, while the workman is working orhim! The deinition is not e'haustive!

(artial 5isablementDy *ection 2 7g" Temporary 3artial


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%ubject to the eEceptions noted below, the term worman means :

-a0 a railway servant as deined in *ection 5 o the Indian 8ailways (ct o 1/.: whois notpermanently employed in any administrative, district or sub-divisional oice o a

railway and not employed in any capacity as is speciied in schedule II or -%0 employed on monthly wages not e'ceeding 8s! 1::: in any such capacity as ismentioned in *chedule II! Irom 1st (pril 1.9, the limit o monthly wages or purposes o this (ct, was raised rom8s! :: to 8s! 1:::! I

The words used in clause 7b" mean that the wages must not e'ceed on average 7now8s! 1:::" a month!

The contract o employment may be e'pressed or implied, oral or in writing!

The (ct provides that the ollowing categories o persons are not to be deemed as workmenor the purposes o the (ct #

-a0 3ersons working in the capacity o a member o the (rmed orces o the ;nion!%0 ( person whose employment is o a casual nature and who is employed otherwise thanor the purposes o the employer=s trade or business!

The e'ercise and perormance o the powers and duties o a local authority or o anydepartment acting on behal o the ?overnment shalt, or the purposes o the (ct, unless acontrary intention appears be deemed to be the trade or business o such authority ordepartment!

The *tate ?overnment has been given power to add to the list in *chedule II anyha%ardous occupation or speciied inCuries in such an occupation! The addition may bemade by notiication in the oicial ?a%ette, with not less than 5 months= notice!

There is legal decision regarding the Buestion who is a workman! The general rule isthat there must be the relationship o master and servant between the employer and theworkman! +orkman is a person whom the empIoyer can command and control in themanner o perorming the work 1ewen v!Noa'es. S (ccording to +ills, the ollowingpoints are to be taken into consideration in determining the Buestion whether a person is aworkman# -a0 the term o engagement -%0 the payment o wages -c0 the power o controlover the work -20 the )ower of dismiss

What is employment of a casual natureR $mployees o a casual nature, i notemployed in the employer trade or business do not come within the deinition o the termworkman as used in the (ct!

?enerally speaking, casual work is one which is not regular !or continuous! ( person

doing odd Cobs was employed by the occupier o a private premises to clean windows!Geld, his work was o a casual nature!3ill v!"e##.4 ( person oiciating in a leave vacan-cy is not a casual worker!In the matter of Alam $in#h.5+hether the employment is or the purpose o the employer=s trade or business depends onwhether the contract o service entered into by the employer was hi his capacity asbusinessman or in a private capacity! +hen a coal mine employs workers to dig or coal itis or his trade or business! >ut a mine owner engaging workers or building his residence,is not engaging them or his trade or business!

( person who does service which is illegal and void cannot be a workman and cannot


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claim compensation!

*3L'% *'A*5"N WO*B4'NC% $O4('N%AT"ON

+hen is employer liable to pay compensationR *ection 57I" lays down that i personal

inCury is caused to a workman by accident arising out o and in course o employment, hisemployer shalt be liable to pay compensation!rom the above it ollows that the employer is liable when -a0 inCury is caused to a

workman by accident and -%0 the accident arises out of and in course of em)loyment. (noccupational disease is deemed to be an inCury by accident and the employer is liable to paycompensation! The section itsel provides that in certain cases o inCury, no compensation ispayable!

+hat is an accidentR Lord 0c&aughton inFenton v, Thorley S Com)any deined anaccident as @an unlocked or mishap or untoward event which is not e'pected or designedQ!Thus a sel- inected inCury is not an accident ordinarily! In rime v!Fletcher a personbecame insane as a result o accident and then committed suicide! It was held that death

was the result o the accident and compensation was awarded! >ut where insanity was notthe direct result o the accident compensation cannot be awarded! e.#., where suicide wasdue to brooding over the accident! 6ithers v! L!". S! $. 6!7aiways.8 ( series o tinyaccidents, each producing some unidentiiable result and operating cumulatively to producethe inal condition o inCury, would constitute together an accident to urnish a properoundation or a claim under the (ct!

(ersonal "njury! ( personal inCury is not necessarily conined to physical orbodily inCury! InCury includes psychological at physiological inCury such as nervousshock, insanity etc! The inCury must be personal! (n inCury to the belonging o aworkman does not come within the (ct!

( workman had to go into a heating room and rom there to cooling plant! The

changes o temperature caused pneumonia an, the workman died! Geld, the death was dueto personal inCury! The Indian News Chronic' &td. v!rs. &uis &azarus.9


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the accident arose out o and in course o employment!75" I the workman reaches the place o employment beore the time when the

employment begins# i it was necessary and not too early, or i at the time o accident hewas doing something to eBuip himsel or the work, he is in course o employment

7 4" I the workman with the knowledge and permission o the employer lives at some

distance rom the place where he is called upon to work and i in the course o proceedingat a reasonable time and in a reasonable manner rom his place to the place o work! hemeets with atal accident then his accident must be held to arise out o and in course oemployment!

7" The period o rest during the period o employment is in the course oemployment! >ut i the workman goes outside the employer=s premises during the restperiod and meets with an accident, it is not in course o employment!

Arisin# out of the em)loyment In!ennis vs6hlite, it was observed that, Q+hen aman runs a risk incidental to his employment and is thereby inCured, then the inCury arisesout o the employment!Q

Notional Extension.! (s a rule the employment o a workman does not commence untilhe has reached the place o employment and does not continue when he has let the placeo employment, the Courney to and rom the place o employment being e'cluded! It isnow wen settled, however, that this is subCect to the theory or notional e'tension oemployer=s premises so as to include an area which the +orkman passes and repasses ingoing to and in leaving the actual place o workQ!Occupational 5iseases! 3ersons employed in certain occupations are liable to be attackedby certain diseases! or e'ample, a person engaged in an employment involving e'posureto dust containing silica is liable to contract silicosis, telegraph operators are liable to havewhat is called Telegraphist=s 6ramp! *uch diseases are known as )ccupational and 3art 6! 3art ( includes (nthra', 6ompressed(ir *ickness, 3oisoning by lead tetra-ethyl and nitrous umes! =3art > includes poisoningby lead compounds, phosphorus, mercury etc!, cancer o the skin, telegraphist=s cramp etc!3art 6 includes *ilicosis, (sbestosis etc!

*ection 572" o the (ct provides that an occupational disease! Qshall be deemed tobe an inCury by accident within the meaning o this section and! unless the contrary isproved, the accident shall be deemed to have arisen out o, and in the course o, theemployment!Qor diseases included in 3art ( o *chedule III, the employer liability= to pay

compensation when a workman employed by him contracts the disease! or the diseasesincluded in 3art >, the employer is liable i a workman contracts it while in his service and

i the workman has been in his service or a continuous period o si' months! which periodshall not include a period o service under any other employer in the same kind oemployment! or diseases included in 3art 6 o *chedule III, the workman is entitled to6ompensation i he has been in the service o one or more employers or such continuousperiod as the 6entral ?overnment may speciy! In such cases the compensation is to bepaid by all the employers in such proportions as the 6ommissioner o +orkmen=s6ompensation may deem Cust!-*ec! 572("!

This list o occupational diseases and the employments producing them as containedin *chedule In may be e'tended 7by notiication" by the *tate ?overnment in the case o


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3arts ( and > and bythe 6entral ?overnment in the case o 3art 6! !

*ection 5 7 4" lays down that save as provided above, no compensation shall bepayable to a workman in respect o any disease unless the disease is directly attributable toa speciic inCury by accident arising out o, and in the course o his employment!

When is employer not liable to pay compensation?*ection 5 o the (ct provides thatthe employer is not liable to pay compensation in the ollowing cases #-a0 in respect o any inCury which does not result in thc total or partial disablement o theworkman or a period e'ceeding three days-%0 in respect o any inCury not resulting in death, caused by an accident which is directlyattributable to-7i" the workman having been at the time thereo under the inluence o drink or drugs, or,7ii" the wilul disobedience o the workman to an order e'pressly given, or to a rulee'pressly ramed, or the purpose o securing the saety o workmen, or,7iii" the wiIuI removall or disregard by the workman o any saety guard or other device

which he knew to have been provided or the purpose o securing the saety o workmen!(s regards e'ception clause 7b" 7in a workman would not lose his right to

compensation only by reason o tile act that he had acted thoughtlessly or oolishly!rom *ection 5 it ollows that the employer is not liable to pay compensation under

the +orkmen=s 6ompensation (ct,in the cases also

+hen the accident did not arise out o or in the course o the employment!

+hen the workmen iled a suit or damages in the 6ivil 6ourt# and

+hen disablement lasted 5 days or less7that is ,inCuries were not

signiicant"

The Amount of $ompensation- The (ct provides or compensation or 71"


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7ules re#ardin# 3alf=monthly Payment The irst hal-monthly payment is to be madeon the si'teenth day 7i" rom the date o the disablement, where such disablement lastsor a period o 2/ days or= more, or 7ii" ater the e'piry o a waiting period o threedays rom the date o the disablement, where such disablement lasts or a period oless than 2/ days! Thereater the payments must be made hal monthly during the

disablement or during a period o ive years! whichever period is shorter!rom any lump sum payment made or compensation and rom any hal-monthlypayment, any sum which the workman has received rom the employer, prior to the receipto the lump sum or hal monthly payment, may be deducted! >ut any sum received ormedical treatment, cannot be so deducted!-*ec! 4 71" 7a"!

&o hal-monthly payment shall in any cases e'ceed the amount, i any, by whichhal the amount o the monthly wages o the workman beore the accident e'ceeds halthe amount o such wages which he is earning ater the accident!-*ec! 4 71" 7b"!

)n the ceasing o the disablement beore the date on which any hal-monthlypayment alls due, there shall be payable in respect o that hal month a sum proportionateto the duration o the disablement in that hal-month!-*ec! 4 72"!

(ny hal-monthly payment payable to= a workman may be reviewed by the 6ommissioneron the -application o either the employer or the workman on! the ground that there has beena change in the condition o the workman! The payment may upon review, be continued,increased, decreased or ended or 7in case the inCury has resulted in a permanentdisablement" converted into a lump sum -*ec! ! !

( right to receive hal-monthly payment may, by agreement or by order o the6ommissioner, be redeemed by the payment o a lump sum! This is called commutation ohal-monthly payments!-*ec! 9!

5istribution of $ompensationD*ection / lays down the ollowing rules regardingthe distribution o compensation #

1! 6ompensation or death and lump sum payment due to a woman or to a person

under a legal disability must be deposited with the 6ommissioner!2! >ut in the case o a deceased workman, an employer may make to !any dependentadvances on account o compensation not e'ceeding an aggregate o one hundred rupees!*o much o such aggregate as does not e'ceed the compensation payable to that dependentshall be deducted by the 6ommissioner rom such compensation and repaid to theemployer!

5! (ny other sum amounting to not less than 8s! 1: which is payable as compensationmay be deposited with the 6ommissioner on behal o the person entitled thereto! !

4! The receipt o the 6ommissioner shall be suicient discharging respect o anycompensation deposited with him!

! (ter the deposit o the compensation, the 6ommissioner shall deduct thererom

the actual cost o theworkman=s uneral e'penses to an amount not e'ceeding 8s! : andpay the= same to the person by whom the e'penses were incurred! ! The 6ommissioner may serve notices calling upon the dependents to appearbeore him or the purpose o determining the distribution o the compensation! 9! I the 6ommissioner is satisied that no dependent e'ists, he shall repay thebalance o the money to the employer! /! The 6ommissioner shall on application by the employer, urnish a statementshowing in detail all disbursements made!

.! The compensation money is to be distributed among the dependents in such


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proportions as the 6ommissioner thinks it! The whole o it may be given to one person!1:! $'cept in the case o a woman or a person under a legal disability, the

compensation money is to be paid Ko the person entitled thereto!11! 0oney payable to a woman or a person under a legal dis ability may be

invested or otherwise dealt with as the 6ommissioner thinks it! Gal-monthly payments

payable to a person under a legal disability may be paid to a dependent o the workmanor to any other person whom the 6ommissioner thinks best itted to provide or thewelare o the workman! 12! The orders o the 6ommissioner regarding the distribution o compensation may be

varied later i necessary! 15! &otice must be given to the parties aected!14! +here under the previous para, the 6ommissioner varies an order on the ground !thatthe payment o compensation to any person has been obtained by raud, impersonation orother improper means,! any amount so paid may be recovered by the procedure laid downor the recovery o arrears o land revenue!

OT#'* (*O+"%"ON% *'A*5"N $O4('N%AT"ON

(ayment of $ompensation! M*ec! 4(!N 6ompensation shall be paid as soon as italls due! +here the employer does not accept the liability to the e'tent claimed, he mustmake provisional payment basedon the e'tent o liability which he accepts! This is without preCudice to the right o theworkman to make any urther claim!

I an employer ails to pay the compensation within one month o the date on whichit ell due, the 6ommissioner may direct the payment o simple interest thereon at H!

Ithe 6ommissioner thinks that there is no Custiication or the delay, he may direct!The payment o a urther sum, not e'ceeding :H o the sum due, by way o penalty! !

(rotection of $ompensationD *ave as provided by this (ct, no lump sum or hal-

monthly payment payable- under the (ct shall in any way be capable o being assignedor charged or be liable to attachment or pass to any person other than= the workman byoperation o law, nor shall any claim be set o against the same!--*ec! !!.!

This section has been ramed, to protect as ar as possible the workman rommoneylenders!

Notice and $laim! *ection 1: o the (ct provides that no claim or compensationshall be entertained by the 6ommissioner unless notice o the accident has been given inthe manner provided as soon as practicable! 7This is subCect to certain e'ceptions notedbelow!"

The reBuired notice must be served upon the employer or upon any o severalemployers or upon any person responsible to the employer or the management o any

branch o the trade or business in which the inCured workman was employed! !The notice shall give the name and address o the person inCured the cause o theinCury and the date o the accident! The notice may be given by the inCured workman or byanybody on his behal! It may be served by delivering it or sending it by registered post!

The *tate ?overnment may reBuire that any prescribed class o employers shall keepat the place o employment a notice book 7accessible to all workers or persons actingbonaide on their behal" where the occurrence o accidents may be recorded! (n entry inthe notice book is suicient notice!

The want of notice or any defect or irregularity in it shall not be a bar to a claim


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in the following cases:

7 1 " +here a workman dies or an accident occurring in the premises o the employeror while working under the control o the employer or o! any person employed by himand the workman died on the premises or without leaving the vicinity o the premises!

! 72" I the employer or anyone o several employers or any person responsible to the

employer or the management o any! branch o the trade or business in which the inCuredworkman was employed, had knowledge o the accident rom any other source at or aboutthe time! when it occurred!

75" I the 6ommissioner is satisied that the ailure to give notice was due tosuicient cause!( workman is bound to give notice o any accident which is not merely trivial, and it is notor him to decide whether it is likely to give rise to a claim or compensation!*ection 1: also provide s that a claim or compensation must be preerred beore the6ommissioner! within two years o the occurrence o the accident or the date o death asthe case may be! In case the accident is the contracting o a disease the date o itsoccurrence is the irst o the days during which the workman was continuously absent

rom work in conseBuence o the disablement caused by the disease!The 6ommissioner may entertain a claim iled ater the prescribed time, i he is o

opinion that the ailure to ile it within time, was due to!=atal AccidentD*ection 1: ( provides that where a 6ommissioner receives

inormation that a workman has died as a result o an accident arising out o and incourse o his employment, he may send by registered post a notice to the workman=semployer reBuiring him to submit, within thirty days o the service o the notice, a state-ment in the prescribed orm, giving the circumstances attending the death o theworkman, and indicating whether in the opinion o the employer, he is or is not liable todeposit compensation on account o the death!

I the employer is o opinion that he is liable, he shall make the deposit within thirty

days o the service o the notice! I he is o opinion that he is not liable, he must state hisgrounds! In the latter case, the 6ommissioner, ater such enBuiry as he may think itinorm any o the dependents o the !deceased workman that it is open to them to preer aclaim and may give them such urther inormation as he may think it! *ection 1: > provides that where by any law or the time being in orce, notice isreBuired to be given to any authority by or on behal o an employer, at any accidentresulting in death or serious bodily inCury, the person reBuired to give the notice shall alsosend a report to the 6ommissioner! The report may be sent alternatively to any otherauthority prescribed by the *tate ?overnment!

The *tate government may e'tend the scope o the provision reBuiring reports oatal accidents to any class o premises! >ut *ec! 1: > does not apply to actories to which

the $mployees= *tate Insurance (ct applies! 4edical 'Eamination! M*ec! 11!N 1! (ter a workman gives notice o an accident, theemployer may, within three days o the service o the notice, oer to have him e'aminedree o charge by a Bualiied medical practitioner! ,

2! (ny workman in receipt o hal-monthly payments may also be reBuired to submitor e'amination rom time to time!

5! The $'amination must be in accordance with the rules ramed or the purpose! !4! I the workman reuses, without suicient cause, to submit to the e'amination or

i he leave the vicinity o the place in which he was employed, his right to receive


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compensation shaIl be suspended during the continuance o the reusal or until his returnto the vicinity and e'amination!

! In case 1he workman, who reused medical e'amination, subseBuently dies, the6ommissioner has discretionary powers o direct payment o compensation to thedependents o the deceased workman!

! The condition o an inCured workman may be aggravated by reusal to submit to!medical e'amination or reusal to ollow the instructions o the medical e'aminer or ailureto be attended by or ollow the instructions o a Bualiied medical practitioner

9! In such a case he would get compensation, not or the aggravated inCury, but orwhat the inCury would have been had he been properly treated!

$mployment by contractors! M*ec! 12!N +hen an employer engages contractors whoengage workmen, any workman inCured may recover compensation rom the employer ithe ollowing conditions are satisied #

7 a" the contractor is engaged to do a work, which is part o thetrade or business o the principal,! !

7b" the engagement is in the course o or or the purposes o his

trade or business, and7 c" the accident occurred in or about the vicinity o theemployer=s premises!

The workman may also proceed against the contractor! *o he has alternativeremedies! +hen the employer pays compensation, he is entitled to be indemniied by thecontractor!

*emedies of employer against stranger! M*ec! 15!N +here a workman hasrecovered compensation in respect o any inCury caused under circumstances creating alegal liability o some person over than the person by whom the compensation was paidand any person who has been called on to pay an indemnity under *ection 12 shall beindemniied by the 3erson so liable to pay damages as aoresaid!

"nsolvency of 'mployer! M*ec! 14!N The liability to pay workmen=s compensation can beinsured against! I an employer who has entered into a contract o insurance or thispurpose, becomes insolvent or enters into a scheme o composition or arrangement or7being a company" is wound up, the rights or the employer as against the insurer shall betranserred to and vest in! the workman! The liability to pay compensation to a workman isto! be treated as a preerred debt under insolvency and windingQ up! or this purpose, theliability to pay hal-monthly payments is to be taken as eBuivalent to the lump sumpayment into which it can be commuted! This section does not apply where a company iswound up voluntarily merely or the purpose o reconstruction or amalgamation withanother company!

Transfer of Assets by 'mployer! M*ec! 14(!!N +here an employer transers his assetsbeore any amount due in respect o any compensation, the liability whereore accruedbeore the date o the transer, has been paid, such amount shall, notwithstanding anythingcontained in any other law or the time being in orce, be a irst charge on that part o !heassets so transerred as consists o immovable property!

4aster and %eamenD*o ar as masters and seamen are concerned, the provisions othe (ct apply with certain modiications laid down in *ection 1!

*eturns! The *tate ?overnment may, by notiication in the oicial ?a%ette, direct


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employers to submit returns regarding compensation paid by them and particulars relatingto the compensation! *ec! 1!

$ontracting Out! *ection 19 provides that any contract by which a workerrelinBuishes bis right to receive compensation or inCury is null and void in so ar as itpurports to remove or reduce the liability o any person to pay compensation under this (ct!

(enalties! *ection 1/( provides or penalties or ailure to perorm the dutiesprescribed under the (ct, e.#., ailure to send returns or maintain notice books etc!

>ar to $ivil %uitsD( 6ivil 6ourt has no Curisdiction to settle, decide or deal with anyBuestion which, because o the provisions o the (ct, is reBuired to be decided or dealt withby the 6ommissioner or to enorce any liability under this (ct!-*ec! 1.72"! *ecovery of the amount awarded! (ny amount payable under the (ct, whether underan agreement or otherwise, shall be recovered as an arrear o land revenue!--*ec! 51

$O44"%%"ON'*%

The (ct provides or appointment o )icers to be known as 6ommissioners o+orkmen=s 6ompensation! The 6ommissioners are to determine the liability o any person

to pay compensation 7including the Buestion whether a person is or is not a workman" andthe amount or duration o compensation 7including any Buestion as to the nature or e'tento disablement"! &o civil court bas Curisdiction to deal with matters which are reBuired tobe dealt with by a 6ommissioner! 6ertain powers have been given to the 6ommissioners,e.#., the power to call or urther deposits! The 6ommissioner has the powers o a 6ivil6ourt!

Form of a))lication&o application or settlement o any matter by a 6ommissioner shallbe made, i the parties have been able to settle it by agreement!

(n application to the 6ommissioner shall be made in the prescribed orm accordingto the rules, and accompanied by a prescribed ee! The ollowing particulars must be givennamely-7a" concise statement o the circumstances and the relie claimedE 7b" in case o

claim or compensation against an employer, the date o service o notice o accident, withits due time o notice and the reason why notice was not givenE 7c" the names andaddresses o the partiesE and 7d" e'cept in case o application by dependent orcompensation a concise statement o the matter on which, agreement has and o those onwhich agreement has not been come to! I the applicant is illiterate or or any reason isunable to urnish the reBuired inormation, the application, i the applicant so desires, shallbe prepared under the direction o the 6ommissioner!-*ec! 22!

A))earance of )arties (ppearance may be done on behal o applicant by a legalpractitioner or an oicial o an Insurance 6ompany, or an authorised person o a registeredTrude ;nion, duly authorised!-*ec! 24!

A))eals and 7eferences or proceedings under the (ct, the Gigh 6ourt o the *tate

is the (ppellate 6ourt! The 6ommissioner can reer a Buestion o law to the Gigh 6ourtor decision and he must decide the matter according to such decision!--*ec 29!

Appeals! (n appeal lies to the Gigh 6ourt rom the ollowing orders o a6ommissioner

7a" an order awarding as compensation a lump sum whether by way o redemptiono a hal-monthly payment or otherwise or an order awarding interest or penalty undersection 4(E

7b" an order reusing to allow redemption o a hal-monthlypayment E


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7 c" an order providing or the distribution o compensation among the dependents oa deceased workman, or disallowing any dain1 o person alleging himsel to be suchdependentE

7d" an order allowing or disallowing any claim or the amounto an indemnity under the provisions o section 1272" E

7e" an order reusing to register a memorandum o agreement or registering the sameor providing or the registration o the same subCect to conditions!

Other Provisions Regarding Appeal :

1! &o appeal shall lie against any order unless a substantiaI Buestion o law, isinvolved in the appeal and, in the case o an order other than an order such as is reerredto in clause 7b", unless the amount in dispute in the appeal is not less than 8s! 5::!&o appeal lies in any case in which the parties have agreed to abide by the decision o the6ommissioner, or in which the order o the 6ommissioner gives eect to an agreementcome to by the parties!

5! &o appeal by employer lies unless the memorandum o appeal is accompanied by acertiicate by the 6ommissioner to the eect that the applicant has deposited with him the

amount payable under the order appealed against!4! The period o limitation or an appeal under this section shall be : days and theprovisions o *ection o the Indian Limitation (ct, 1.:/, shall be applicable to appealsunder this section!

Amendments of Wormen6s $ompensation Act -.27:

It is now changed as $mployees 6ompensation (ct 1.25!

@+orkmanA is substituted byA $mployeeAmeans any person who is

7i" a railway servant not permanently employed in any administrative, district or sub-divisional oice o a railway and or not employed in any such capacity as speciied in

*chedule II, or

7ii" a master, seamen or other member o the crew or a ship,

7iii a captain or other member o the crew o an aircrat,

7iv" a person recruited as driver, helper, mechanic, cleaner or in any other capacity inconnection with a motor vehicle!

7v" a person recruited or work abroad by a company,

7vi" $mployed otherwise than in a clerical capacity in connection with the operation7repair" or maintenance o a lit or vehicle propelled by steam or other mechanical power or

by electricity or in connection with the loading and unloading o any such vehicleE or7vii" $mployed in any premises wherein or within the precincts o manuacturing processas per section II o actory (ct!

7viii" $mployed upon a 8ailway either directly or through a sub-contractor ,

7i'" $mployed as an Inspector, 0ail ?uard, $tc!

6asual labour employed in 8ailways are governed under this act and entitled orcompensation!


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$ompensation:

7a" +here the death resultsrom the inCury #

(n amount eBual to :H o the wages o thedeceased workman multiplied by the relevantactor or an amount o 8s $ighty thousand

whichever is more!7b" where permanent or totaldisablement results rom theinCury

(n amount eBual to :H o the wages o thedeceased workman multiplied by the relevantactor or an amount o 8s &inety thousandwhichever is more!

7c" where permanent partialdisablement results rom theinCury

>ased on the percentage o loss o earningcapacity caused by the accident i the inCury isspeciied in part II o *chedule I, and in case theinCury is not speciied in *chedule , percentage asassessed by the Bualiied 0edical 3ractitioner!

7d" where temporary

disablement, whether total orpartial results rom theinCury

( hal monthly payment o the sum eBuivalent to

2H o monthly wages o the workman to bepaid!

I the inCury o the workman results in his death, the employer shall, in addition tothe compensation, deposit with 6ommissioner a sum o two thousand 8upees orpayment to the eldest surviving dependent o workman towards uneral e'penditure!

4"N"434 WA'% A$T, -.:acground

( tripartite 6ommittee i%!, QThe 6ommittee on air +ageQ was set up in 1.4/ toprovide guidelines or wage structures in the country! The report o this6ommittee was a maCor landmark in the history o ormulation o wage policy in India!Its recommendations set out the key concepts o the =living wage=, QminimumwagesQ and Qair wageQ besides setting out guidelines or wage i'ation!

(rticle 5. states that the *tate shall, in particular, direct its policy towards securing 7a"that the citi%en, men and women eBually shall have the right to an adeBuate livelihoodand 7b" that there is eBual pay or eBual work or both men and women!

(rticle 45 states that the *tate shall endeavour, by suitable legislation or economic

organi%ation or in any other way, to give all workers, agricultural, industrial orotherwise, work, a living wage, conditions o work ensuring a decent standard o lieand ull enCoyment o leisure, and socia l and cultura l opportunities!

#istorical >acdrop

U The initiative started with the resolution placed by one *hri! F! ?! 8! 6houdhary in1.2: or setting up >oards or determination o minimum wages in each industry!


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U The International Labour 6onerence adopted in 1.2/ 6onvention &o!2 and8ecommendation &o! 5: relating to wage i'ing machinery in trades or parts o trades!

U )n the recommendation o the *tanding Labour 6ommittee and Indian Labour6onerence, a Labour Investigation 6ommittee was appointed in 1.45 to

investigate into the Buestion o wages and other matters like housing, socialconditions and employment!

U ( drat bill was considered by the Indian Labour 6onerence in 1.4!

U The /th meeting o the *tanding Labour 6ommittee recommended in 1.4 to enacta separate legislation or the unorgani%ed sector including working hours, minimumwages and paid holidays!

U ( 0inimum +ages >ill was introduced in the 6entral Legislative (ssembly on11!4!4 to provide or i'ation o minimum wages in certain employments! It was passedin 1.4 and came into orce with eect rom 1!5!4/!

;nder the (ct, 6entral and *tate ?overnments are appropriate ?overnments to

7a" notiy scheduled employment

7b" i'Drevise minimum wages

The (ct contains list o all these employments or which minimum wages are to bei'ed by the appropriate ?overnments!

There are two parts o the *chedule! 3art I has non-agricultural employmentswhereas 3art-II relates to employment in agriculture!

$riteria for notification of scheduled employment

;nder the provisions o the 0inimum +ages (ct, 1.4/, both 6entral and *tate?overnments are appropriate ?overnments to i', review and revise the minimumwages o the workers employed in the scheduled employments under their respectiveCurisdictions! The appropriate ?overnments have also been empowered to notiy anyemployment in the schedule where the number o employees is 1::: or more and i'the rates o minimum wages in respect o the employees employed therein!

There are 4 scheduled employments in the 6entral *phere while in the *tate *pherethe number o such employments is as many as 1.!


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The 0inimum +ages (ct does not provide or any discrimination between male and emaleworkers or dierent minimum wages or them! (ll the provisions o the (ct eBually apply toboth male and emale workers!

Norms for fiEationFrevisionof minimum wages

The norms include those which were recommended by the Indian

Labour 6onerence in its session held in 1.9!

7a" 5 consumption units or one earner!

7b" 0inimum ood reBuirements o 29:: calories per average Indian adult!

7c" 6lothing reBuirements o 92 yards per annum per amily!

7d" 8ent corresponding to the minimum area provided or under ?overnment=s Industrial Gousing*cheme!

7e" uel, lighting and other miscellaneous items o e'penditure to constitute 2:H o the total0inimum +ages!

Other parameters

7i" Q6hildren education, medical reBuirement, minimum recreation includingestivalsDceremonies and provision or old age, marriage etc! should urther constitute2H o the total minimum wage!Q This Cudgment was delivered by the *upreme 6ourt oIndia in 1..1 in the case o 8eptakos >rett and 6o! s! its workmen!

7ii" Local conditions and other actors inluencing the wage rate! 0ethods ori'ationDrevisiono minimum wages ,i'ation!

*ection 5 empowers appropriate ?overnment to i' the minimum rates o wages in thescheduled employments!

8evision

8evise the 0inimum rates at an appropriate interval not e'ceeding ive years!

(rocedure for =iEationF*evision

In *ection o the 0inimum +ages (ct, 1.4/, two methods have been provided ori'ationDrevision o minimum wages! They are 6ommittee method and &otiication method!

$ommittee 4ethod

;nder this method, committees and sub-committees are set up by the appropriate?overnments to hold enBuiries and make recommendations with regard to i'ation and revision ominimum wages, as the case may be!


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%teps taen to reduce disparit ies

=ive *egional $ommittees

There is disparity in rates o minimum wages in various regions o the country! This isdue to dierences in socio-economic and agro-climatic conditions, prices o essential

commodities, paying capacity, productivity and local conditions inluencing the wagerate! The regional disparity in minimum wages is also attributed to the act that both the6entral and *tate ?overnments are the appropriate ?overnment to i', revise andenorce minimum wages in scheduled employments in their respective Curisdictionsunder the (ct! To bring uniormity in the minimum wages o scheduledemployments, the ;nion ?overnment has reBuested the *tates to orm regional6ommittees! (t present there are ive 8egional 0inimum +ages (dvisory 6ommitteesin the country, which are as under# -

8egion *tatesD;Tscovered

$astern 8egion 7" +est >engal, )rissa, >ihar, Kharkhand, 6hhattisgarh and(ndaman S &icobar Islands!

&orth $astern 8egion 7/" (runachal 3radesh, (ssam, 0anipur, 0eghalaya, 0i%oram,&agaland, Tripura and *ikkim!

*outhern 8egion 7" (ndhra 3radesh, Farnataka, Ferala, Tamil &adu, 3ondicherry andLakshadweep!


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&orthern 8egion 7." 3unCab, 8aCasthan, Gimachal 3radesh, Kammu S Fashmir,Garyana, ;ttar 3radesh, ;ttarakhand, ased on the norms suggested by the +orking ?roup and its acceptance by the6entral (dvisory >oard subseBuently in its meeting held on 1.!12!2::5, the

&ational loor Level 0inimum +age was revised upwards to 8s!D- per daywith eect rom 1!:2!2::4! )n the basis o increase in the 6onsumer 3rice

Inde', the 6entral ?overnment urther revised the &ational loor Level0inimum +ages rom 8s!D- to 8s!/:D- per day with eect rom :1!:.!2::9!

It is, however, clariied that the &ational loor Level 0inimum +age, is a non-statutory measure to ensure upward revision o minimum wages in d i e r e n tin * t a t e s D;Ts! Thus, the * t a t e ? o v e r n me n t s ar e persuaded to i'minimum wages such that in none o the scheduled employments, the minimumwage is less than &ational loor Level 0inimum +age! This method hashelped in reducing disparity among dierent rates o minimum wages to somee'tent! To sum up, eective implementation o the 0inimum +ages (ct, 1.4/,including that o the revision o minimum wages at national loor level

minimum wage or higherE which primarily alls in the *tate sphere, isassiduously pursued by us through discussion, writing letters, personalinteraction and visits to *tates, including the &orth-$astern *tates! The*tate ?overnments are regularly asked to i' and revise minimum wages inscheduled employments to be at least at par with &ational loor Level0inimum +age o 8s!/:D- per day as at present! +hat they actually do is inkeeping with their respective paying capacity!

*ecent "nitiatives

>ased on the recommendations o the 0inimum +ages (dvisory >oard 70+(>" in its

meeting held on 22!:1!2::/ and 2!:!2::/, the 0inistry o Labour S $mployment hasissued the inal &otiication in the ?a%ette o India 7$'tra )rdinary" i'ing the


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minimum rates o wages or workers employed in the scheduled employments@$mployment o *weeping and 6leaningA in the 6entral sphere at 8s!12:D-, 8s!1:D- and 8s!1/:D- per day and or @$mployment o +atch and +ardA 7a" withoutarms at 8s!12:D-, 8s!1:D- and 8s!1/:D- per day and 7b" with arms at 8s!14:D-,8s!19:D- and 8s!2::D- per day or (rea 6, > and ( respectively and the inal

&otiications in respect o revision o minimum rates o wages or workers engaged in thescheduled employments o @6onstructionA and @Loading and ;nloadingA in the6entral sphere at 8s!12:D-, 8s!1:D- and 8s!1/:D- per day or unskilled workers to8s!2::D-, 8s!22:D- and 8s!24:D- per day or highly skilled workers in (rea 6,> and (respectively and or workers engaged in @&on-6oal 0inesA in the 6entral sphere at8s!12:D- per day or unskilled +orkers 7(bove ?round" to 8s!24:D- per day or highlyskilled workers 7>elow ?round"!L

List o *cheduled $mployments in 6entral ?overnment under the0inimum+ages (ct, 1.4/

*!&o &ame o $m lo ment1! ( riculture2! 6onstructionD0aintenance o 8oads and >uildin ) erations!5 0aintenance o >uildin s4! 6onstruction and 0aintenance o 8unwa s!! ? sum mines!! >arites mines!9! >au'ite mines!/! 0an anese mines!

.! 6hina 6la mines!1: F anite mines!11 6o er mines!12 6la mines!15 *tone mines!14 +hite 6la mines!1 )rchire mines!1 ire 6la mines!19 *teatite *oa stone and Talc 0ines!1/ (sbestos mines!1. 6hromite mines!

2: Juart%ite 0ines21 Juart% mines22 *ilica mines!25 0a nesite 0ines24 ?ra hite mines!2 els ar mines!2 8ed o'ide mines!29 Laterite mines!2/


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55 8ock hos hate mines!54 Gematite mines!5 0arble and 6alcite 0ines!5 ;ranium mines59 0ica mines!

5/ $m lo ment in Li nite 0ines5. $m lo ment in ?ravel 0ines4: $m lo ment in the *late 0ines41 $mployment in laying down o underground electric, wireless, radio, television,

telephone, telegraph and overseas communication cables and similar otherunder round cablin electric lines water su l lines and sewera e i e lines!

42 Loadin and ;nloadin in 8ailwa s ?oods *hed45 *tone >reakin and *tone 6rushin44 $m lo ment in *wee in and 6leanin4 $m lo ment in +atch and +ard

14 labour legislation

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