Legal Aspects of Healthcare Sector

As we know that the Hospital deals with providing medical service to patients in order to
better their health. An important question therefore comes up:
IS HOSPITAL AN INDUSTRY?

This question first appeared in the case of State of Bombay vs Hospital Mazdoor Sabha
1960, where it was stated that the presence of profit motive is not essential for bringing an
undertaking under the meaning of undertaking under S 2(j) of the ID Act. This means that
even if a private citizen runs a hospital for free, it would still be an undertaking within 2(j).
The Court also held that the doctrine of quid pro quo would not be applied here and held that
Hospital mounted to an undertaking and therefore was an industry. However, this was

Hospitals run by the Government as part of its sovereign functions with the sole object to provide free serv
All other hospitals, either managed by private or public or for charitable purpose or commercial purpose, w

overruled in 1970 in the Management of Safdarjung Hospital vs Kuldip Singh Sethi and
the Court held that if a hospital, nursing home or dispensary was run in a commercial way, it
may be an industry. However, hospitals run by the Government or private associations on
charitable lines as part of the functions of the Health Department of the Government cannot
be included in the definition of industry. Thus, we may conclude that
The Government has enacted various laws in order to protect the interests of the people in
the healthcare sector.
Indian Nursing Council Act 1947 This act has been constituted to form an Indian Nursing
Council in order to establish a uniform standard of training for nurses, midwives and health
visitors. The Nurses Council is an autonomous body under the Government of India,
Ministry of Health & Family Welfare. The Council seeks to fulfil the following objectives:
To establish and monitor a standard from of education
To advise the state nursing and midwives councils
To recognize institutions or organizations imparting education in nursing
To improve the quality of nursing in India
There are a number of labour laws that are applicable to employment and management of
manpower in the hospital sector. These include both State as well as Central laws some of
which are stated below:
1. Citizenship Act 1955
2. Employee Provident Fund and Miscellaneous Provision Act 1952

3. Employment Exchange (compulsory notification of vacancies) Act 1959

4. Equal Remuneration Act 1976
5. ESI Act 1948
6. ESI Rules 1950
7. Indian Trades Union Act 1926
8. Industrial Dispute Act 1947
9. Maternity Benefits Act 1961
10. Minimum Wages Act 1948
11. Negotiable Instrument Act 1881
12. Payment of Bonus Act 1956
13. Payment of Gratuity Act 1972
14. Payment of Wedges Act 1936
15. Persons with Disabilities Act 1995
16. PPF Act 1968 19. SC and ST ACT 1989
17. Shops and Factories Act (for national holiday)
18. TDS Act
19. The Essential Service Maintenance Act 1981
20. The Payment of Gratuity Act 1972
21. Workmens Compensation Act 1923
Along with these above Acts, there are various State laws that cover these hospitals such as
the State specific Shop and Establishment Act, and the State specific Labor Welfare Fund
Act
Most of the Acts enacted are regarding the registration and training of healthcare workers.
They do not deal specifically with collective bargaining or unionization of the healthcare
workers. The various council which are functioning as result of the legislation has no say in
the wages and service conditions of these professionals.