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Industrial Relations and Labour Laws: Two Sides of The Same Coin

Industrial Relations and Labour Laws: Two Sides of The Same Coin

INDUSTRIAL relations have taken a tricky turn in modern times. To define them simply, the concept of industrial relations refers to the relationship between employees and management in the day-to-day working of an industry. It is concerned with the relationship of management with workers but at the same time, seeks to protect the interests of the employees. To resolve disputes, special role is played by various rules and procedures that have been put into place to maintain industrial democracy and establish a proper channel of communication between management and workers.

With globalization and liberalization, there had been many changes in the socioeconomic conditions throughout the world. The open trade policy warranted the labour laws to be updated to match with the changing needs. We here look at some of the landmark Indian labour laws that take care of the common man needs and have indeed proved to be the backbone of the country

CONTRACT LABOUR (REGULATION AND ABOLITION) ACT 1970:

The main objective of this law was to regulate the employment of the contract labour and to provide for its abolitions in certain circumstances. It is applicable on 20 or more workmen employed on any day of preceding 12 months as contract labour. Sections 7 and 10 give way for registration of principal employer and contractor and prohibition of employment of contract labour, respectively. While it licenses the contractor, the Law also provides some liabilities on principal employer, including provision of canteen, restroom, wagesthrough-contractor. It also puts the responsibility on contractor to ensure timely payment of wages not less than minimum wages.

Under this law, employees are also entitled for entitlement on completion of 5 years of service.

PAYMENT OF WAGES ACT, 1948:

This Act defines wages which include allowances, basic plus D.A. except bonus, HRA, employer’s contribution towards provident fund, T.A., Gratuity etc. also mentioned is the day of payment of wages, which is less than 1,000 persons employedbefore the expiry of 7th day and 1,000 and more persons before the expiry of 10th day (in case of termination of person before the expiry of 2nd working day). The Act also mentions when wages can be deducted, i.e. in case of fines, absence from duty, damage caused to employer, housing accommodation, amenities, recovery of advances/loans, taxes, LIC, trade union, provident fund etc.

MINIMUM WAGES ACT 1948 :

This Act provides for fixing minimum rates of wages in certain employment. Under the Act, minimum wages include basic rates plus variable D.A. plus value of other concessions. The state governments are also subjected to regularly notify minimum wages for unskilled, semi-skilled and skilled workmen/employees.

EMPLOYEEA’ COMPENSATION ACT ,1923 OR (WORKMEN’S COMPENSATION SUBSTITUTED ON 18.01.2020)

Under this Act, an employee is a regular employee as well as contract labour. An employee is liable for compensation in case of death, an amount equal to 50% of the monthly basis of the diseased employee multiply by relevant factor or Rs 1,20,000 whichever is more. It also provides benefits to employees in case of permanent total disablement, which is 60% of the monthly wages multiply by relevant factor or of an amount of Rs 1,40,000, whichever is more. The Act also set a limitation for claim of compensation, which is 2 years from the date of death or occurrence of accident. This may be extended by the court due to sufficient cause.

TRADE UNION ACT,1926

This landmark Act provided for formation of trade union. It grants that any seven or more members of trade union, who are engaged as workmen or employed in industry/establishment, can apply for registration. The Act states that no trade union of workmen shall be registered unless at least 10% or 100 of the workmen, whichever is less, are engaged or employed in the establishment or industry. The Registrar has been empowered under this Act to cancel the Certificate of Registration of Trade Union under different circumstances.

PAYMENT OF BONUS ACT, 1965 :

This Act applies to establishments employing 20 or more persons on any day during an accounting year. Under this, employee means any person employed on a salary/wages up to Rs 10,000 per month other than apprentice. It stated that if found guilty of misconduct or causing loss to employer, a said employee is not entitled for full bonus and an employer can deduct such loss from the annual bonus.

INDUSTRIAL EMPLOYMENT (STANDING ORDERS) ACT, 1946:

This Act applies to industrial establishment employing 100 or more workmen. Appropriate government can direct its applicability to any industrial establishment employing less than 100 workmen. This Act does not apply to BIR Act or MPIR Act and Indian Railway and Defense Service etc.

INDUSTRIAL DISPUTE ACT, 1947 :

The Act defines dispute as issue of contention between employers and workmen or workmen and workmen, connected with the employment or nonemployment or terms of employment etc. disciplinary action can be taken byemployers but this does not include VR, retirement, termination due to continued ill-health. Dismissal of workmen on these counts may be deemed as industrial dispute.

Under this Act, an interim or final determination of any industrial dispute can be reached by a Labour Court, Industrial Tribunal or National Industrial Tribunal or Arbitration Award.

Interestingly, this Act provides for full payment of wages to workmen against whom legal proceedings are pending. But this Act also prohibits strikes and lock-outs.

SEXUAL HARRASEMENT

Under the 2013 Act on sexual harassment of women at workplace (Prevention, Prohibition and Redressal& Rules of the Company), sexual harassment includes unwelcome sexually determined behavior,physical contact, advances, sexually remarks, showing pornography, sexual demand, request for sexual favors or any other unwelcome conduct of sexual nature whether verbal, textual, physical, graphic or electronic or by any other actions. The Duties of Employers in this case range from (i) providing safe condition, (ii) display of prohibitory notices (ii) conducting training and awareness programmers against harassment (iv) appointment of committee for complaints and conferring them with authority to conduct enquiry

DEPARTMENTAL ENQUIRY

There are various measures to usher in discipline in industry, which is also necessary for promotion of efficiency and maintenance of good atmosphere in which production can be increased. Every employee is bound to observe certain rules and discipline in discharge of his duties and any breach of discipline may amount to misconduct.

There are various measures to usher in discipline in industry, which is also necessary for promotion of efficiency and maintenance of good atmosphere in which production can be increased. Every employee is bound to observe certain rules and discipline in discharge of his duties and any breach of discipline may amount to misconduct.

Besides, each enquiry should be conducted in a free and fair manner to promote democratic relations within industry. This leaves us with many queries regarding the nature of offence and criminal cases or circumstances under which an employee can be suspended. These should be dealt with utmost care and in most cases, contextually and under professional advice.

About Author

Hemant Kumar

Hemant is Group General Counsel, Essar Group