Name – Prof.

Mandakini Rajendra Bhosale

Lecturers

P.E. Society’s Institute of Management and Career Development,

Nigdi, Pune – 411044

Mobile – 9822789288

Address for Correspondence

Sindhunagar, LIG,

Block 46/6, Sector 25,

Pradhikaran, Nigdi, Pune - 411044

.
 Labour Legislation: Review of resent evidences

The purpose of this Paper is, to provide an overview of events of the Industrial relations system which have
influenced, or are influencing, the development of industrial relations. Labour relations should be seen as an
essential part of management systems and techniques, and not as a discipline or activity apart from management. It
seeks to explain what sound industrial relations and labour relations policy formulation are, and to underline the
importance and objectives of sound industrial relations in the current - and to some extent the future context. It next
examines the role of various systems and mechanisms at different levels (national/industry/enterprise) as well as
their contribution to promoting sound industrial relations. It also attempts to identify some of the elements which
may generally be regarded as features of a good industrial relations system. Finally, the Paper identifies current
issues in industrial relations. Following are some resent evidences …

I - Third India- European Union seminar on

EMPLOYMENT RELATIONS AND RESOLUTION OF CONFLICTS
(NEW DELHI – SEPTEMBER 22-23, 2008)
India and European Union (EU) have entered into a Joint Action Plan to have a policy dialogue and cooperation in
the fields of employment and social policy to share experience, periodic exchange of views and information on the
following issues:-
(i) Labour and employment issues, including employment policies, restructuring, the global employment
opportunities and requirements for trained manpower;
(ii) Human resource management in particular through training and skills development; and
(iii) Social Security.
2. In line with the Joint Action Plan, the Ministry of Labour & Employment,
Government of India has signed an Memorandum of Understanding (MOU) with the
European Commission to strengthen dialogue and exchange of views and information on issues of common interests
within the area of employment and social policy such as: skills, training and employment, social security,
occupational health and safety; workers’ participation in management; and other relevant issues jointly identified.
3. Accordingly, the first Seminar on Skills Development and training was held on 27 & 28th November, 2006 at
New Delhi. The second seminar on social security and social protection was held on 17-18th September, 2007 at
Lisbon, Portugal. It has now been decided to organize the 3rd seminar on “Employment Relations and Resolution of
Conflicts” on 22-23 September, 2008 at Symposia Hall, NASC Complex, Indian Council of Agricultural Research,
DPS Marg, Pusa, and New Delhi-110 012. The seminar will have the following thematic sessions:-
(i) Trends in Employment Relations and Social Dialogue
(ii) Collective Bargaining
(iii) Worker’s Participation in Management
(iv) Labour Dispute Resolution – Challenges, strategies and Best Practices.

Employment and industrial relations scenario in India has been undergoing rapid transformations, coinciding with
the advent and spread of globalisation. There are four broad temporal phases (1947-1965, 1966-1977; 1980-1991,
and 1991 till date) in the employment and industrial relations history in India.
The first phase (1947-1965) was characterized by the development of state-led industrialization, based on import
substitution and employment-intensive public sector enterprises. This was a period, which witnessed rapid growth of
unionization. Their membership also trebled during this period. The public sector emerged as a major arena for
unionization. The tendency towards collective bargaining was effectively curbed as tripartism rather than bipartism
became the norm. . This phase was marked by comparative peace and relatively low levels of industrial disputes.
The second phase (1966-1977) coincided with severe industrial stagnation and low rates of employment growth.
This phase saw a dramatic increase in the levels of industrial disputes owing mainly to the tightening of the labour
market. Both strikes and lockouts increased, as did the number of man days lost due to disputes. Centralized
structures of industrial relation system showed signs of crisis.
The third phase (1980-1991) coincided with the beginning of liberalization and gradual withdrawal of the state
from economic activities and the industrial relation scenario. While no overt changes in the labour law and labour
market policies were made (except for the 1982 and 1984 amendments to the Industrial Disputes Act, 1947 which
lowered the ceiling of establishment size for requiring permission for closure and retrenchment to 100 workers and
introduced the unfair labour practices schedule), there emerged significant subterranean changes affecting the
industrial relations system at the level of individual firms, specific industries, and regions.
 The final phase (1991 – till present), coinciding with a vigorous acceleration of economic reforms, has seen
greater decline in public sector employment. The changing role of the State, competitive pressures of globalisation,
technological changes, and changing work organisation, along with the resultant contractualisation and outsourcing,
has impacted the employment relations scenario in the country.
An overall trend in the industrial relations system in the post independence period is also seen, especially in relation
to the change from a state-dominated industrial relations system and centralized wage bargaining structure to a more
pluralistic and decentralized industrial relations system.
This is particularly important, towards highlighting the centrality of labour and industrial relations, while evolving
effective and inclusive socioeconomic policies, aimed at higher levels of economic progress..
As India is passing through process of Liberalization, Privatization and Globalisation, there is a dire need to
strengthen social dialogue for promoting harmonious employment relations, both at the national and state level as
under the Constitution States have concurrent jurisdiction on matters concerning labour and society. Social dialogue
at the sectoral level also needs to be enriched because of the diverse needs and circumstances of different sectors
such as IT and Services on the one hand and traditional industries like jute, textiles, mining etc. on the other hand. A
strong foundation of social dialogue at the sector and state levels is a pre-requisite to a solid structure of social
dialogue at the national level.

INDIAN LABOUR CONFERENCE- Labour policy in lndia has been evolving in response to the specific needs of
the situation in relation to industry and the working class and has to suit the requirements of a planned economy. A
body of principles and practices has grown up as a product of joint consultation in which representatives of
Government, the working class and employers have been participating at various levels. The legislation and other
measures adopted by Government in this field represent the consensus of opinion of the parties vitally concerned
and thus acquire the strength and character of a national policy, operating on a voluntary basis. Joint committees
have been set up to assist in the formulation of policies as well as their implementation. At the apex of this tripartite
machinery is the Indian Labour Conference. Following are the details of the conferences held since 1940.

Sr.No Date of conference Session Venue Chairman

1 22-23January,1940 1st Session* New Delhi Sh.Ramaswami Mudaliar
2 6-7 Sept., 1943 5th Session# New Delhi Dr.B.R.Ambedkar
3 20-21 March, 1950 10th Session New Delhi Sh.Jagjivan Ram
4 18-20 May, 1958 16th Session New Delhi Sh.Gulzari Lal Nanda
th
5 7-9 August, 1962 20 Session New Delhi Sh.Gulzari Lal Nanda
6 20-21 April, 1968 25th Session New Delhi Sh.Jaisukh Lal Hathi
th
7 7-8 Sept., 1992 30 Session New Delhi Sh.P.A.Sangma
8 3-4 April,1998 35th Session New Delhi Dr.Satyanarayan Jatiya
9 9-10 Dec., 2005 40th Session New Delhi Sh. K. Chandrashekhar Rao

I- 44th session of Labour conference held in 19 Feb 2012 in New Delhi.

Key Recommendations of 44th session of Indian Labour Conference February 19.2012
 Minimum Wages Act Coverage for all Employments
Raising the wage Ceiling in the Employees Provident Fund, enhancement of Pension under
Employees Pension Schemes 95, Portability of PF Account, Reduction in the Requirement of
Minimum Continuous Service Etc.

 Stress on Matching the Large Scale Skilling Targets with Creating Similar Number of Openings in the
Area of Employment
 Maternity Leave Under the Maternity Benefit Act be Increased from the Present Level of 12 Weeks to
24 Weeks
Key Recommendations of 44th Session of Indian Labour Conference February 19, 2012

Union Labour & Employment Minister Shri Mallikarjun Kharge detailed about the recommendations made
during the 44th Indian Labour Conference concluded at Vigyan Bhavan, New Delhi. Addressing the media persons
he said this Session of the Indian Labour Conference had elaborate discussions on three agenda items – (i)
Minimum Wages (ii) Social Security and (iii) Employability and Employment.

The Conference was inaugurated by Hon’ble Prime Minister of India. The Conference was attended by Labour
Ministers from 14 State Governments. All the major 12 Central Trade Union Organisations and 6 major employers’
organisation participated in the Conference. Besides, senior officials from 23 Central Ministries and all State
Governments/UTs attended the Conference. The International Labour Organisation Experts based at Delhi were
also present.

Shri Kharge said our huge unorganized sector poses great challenges in ensuring quality employment and extension
social security coverage. Minimum Wages are an important means of protecting the interest of the workers were not
in the formal sector. Our flagship health insurance scheme “Rashtriya Swasthya Bima Yojana” has covered
2.5 crore Below Poverty Line families and this Scheme is being extended to cover other category of workers.

1. Employment generation and Employability should be top agenda of the Govt.

2. Though lot of focus is being laid on training of 500 million persons by 2022, there is a need to take appropriate
measures for creation of employment opportunities to offer the matching employment.

3. There is an urgent need to declare the National Employment Policy in order to provide enabling framework for
facilitating employment generation and decent working conditions for all.

4. Investment in labour intensive industries should be promoted and incentivised.

5. Labour Market Information System should be established to get skill requirement from the industry and available
skills from the institutes. In this regard, employment exchanges may be modernized for providing virtual job market
on real time basis.

6. There should be functional and spatial integration of State and Central infrastructure and other available
resources for optimal utilization of resources.

7. Existing employment in the unorganized sector should be safeguarded by assuring access to natural resources
for those sectors dependent on them. In order to increase their productivity, appropriate advanced tools and
technology for traditional producers should be developed.

8. Skill development should be promoted among the women and differently-abled persons. To increase
participation of women in skill development, special measures should be taken.

9. National level consultation with all the stakeholders should be held immediately to finalize the road-map for
preparing skill development plan leading to skilled force of 500 million persons by 2022.

During the Conference a Committee was constituted to discuss Agenda Item No.(i) concerning Minimum
Wages and related issues. These issues, inter alia, include norms for fixation/revision of minimum rates of wages,
Variable Dearness Allowance(VDA), National Floor Level Minimum Wages etc. On the basis of detailed
discussion, the following points emerged.
1. There was consensus that the Government may fix minimum wages as per the norms/ criteria recommended by
the 15th ILC (1957) and the directions of the Hon’ble Supreme Court (Repttakos Co. Vs Workers’ Union)
1992. The Government may take necessary steps accordingly.

2. There was a broad consensus that the Minimum Wages Act should cover all employments and the existing
restriction for its applicability on the scheduled employments only should be deleted. This will also help India ratify
ILO Convention No.131.

3. It was broadly agreed that there should be national minimum wages applicable to all employments throughout the
country.

4. There was broad agreement on the amendment proposals as listed out .

A Conference Committee was also constituted to discuss the agenda item No. (iii) i.e. “Social
Security”. On the basis of detailed discussions, the following points emerged:-

(i) There was a broad-based consensus that the wage ceiling for the application of EPF Act be increased from the
present level of Rs.6,500/- to Rs.10,000/- or Rs.15,000/- as already applicable for the ESI Corporation. Similarly,
the ceiling for workers covered under EPF Act be reduced from 20 to 10. However, Laghu Udyog Bharati was not
agreeable to this reduction in ceiling of number of workers.

(ii) Minimum pension under the EPS 95 be increased to some floor level, which should not be less than Rs.1,000/-
, since a large number of workers receive pension which is less than that provided by the State Governments for
elderly people which is normally in the range of Rs.400/- to Rs.1000/-.

(iii) The PF Accounts be computerized urgently so that the workers are able to avail the facility of PF transfer and
settlement immediately. Smart Cards like RSBY be issued to PF account holders.

(iv) Minimum ceiling of 5 years of continuous service be reduced in case of gratuity and gratuity be made
transferable in case of change of job by the employee.

(v) The maternity leave under the Maternity Benefit Act be increased from the present level of 12 weeks to 24
weeks. This increased maternity benefits be made available only upto two children, while the
lower limit be continued for more than two children.

(vi) Accountability on the part of organizations implementing the social security schemes befixed in order to ensure
that the beneficiaries receive the deliverables in time. Citizen Charters for these organizations be finalized early.

II - AK Padmanabhan, President, Centre of Indian Trade Unions

Contract workers were earlier hired only to do small jobs, but that has changed now. In most cases, these workers do
the job of regular employees. Contract workforce accounts for more than 85% of the total workforce in private
factories and over 50% in public sector undertakings now.

The situation is ridiculous, given that regular workers are employed for the first shift and contract workers do the
same job in the next shift, but are paid less than a quarter of the wages of regular employees. The law prohibits
employers from hiring contract workers for jobs that are perennial in nature.

However, in many factories, contract workers have been involved in direct production activities for over 25 years.
Fraudulent ways have been used to overcome the legislation. Though we moved courts, the Supreme Court has
given different rulings in different cases.
 III - Labour laws need to be reviewed: PM

NEW DELHI: Prime Minister Manmohan Singh on Tuesday reopened the debate on labour reforms, suggesting that
there was need to periodically assess the regulations to ensure that they did not impact employment and industrial
expansion.

At the same time, Singh sought to play down the concerns saying that "this view has lost its importance in recent
years" as state governments are increasingly showing more flexibility on labour restructuring and rationalization.
"Though our government remains committed to protecting the interests of our workers, we must periodically take a
critical look whether our regulatory framework has some parts which unnecessarily hamper the growth of
employment, enterprise and industry without really contributing significantly to labour welfare," the prime minister
said.

For several years, reform of labour laws has been on the backburner in the wake of protests from the unions. In fact,
there have been few statements from the UPA on the subject. But Singh's comments, which come weeks before the
budget, are being seen as a sounding board of sorts in many circles.

In his address, Singh touched upon two areas where there was a need to revisit the laws. The first dealt with part-
time employment of women with characteristics of a full-time job. The second issue was to deal with migrant
workers as the prime minister said that the system is at present weak. In recent years, treatment of migrant workers
in China has been a major talking point and probably Singh wants to avoid a similar situation in India.

IV - ( K.M. Sahni )Secretary Ministry of Labour & Employment says in his report that
In the context of preparation of the Eleventh Five Year Plan (2007-2012), the Planning Commission set up a
Working Group on Labour Laws and Other Labour Regulations under the Chairmanship of Secretary, Ministry of
Labour & Employment, Government of India, laying down the terms of reference.
The subject basically relates to labour law reforms. It is a dynamic and continuous subject, evolving over time. The
Report touches upon the historical background, nature and classification of various labour laws and steps already
taken and being desired so that our labour laws are in conformity with changing socioeconomic scenario. The basic
purpose being to promote interests of all stake holders and arriving at a consensus in the matter, we have immensely
benefited from the interactions we had with them in various for a , including the deliberations in this Meeting of the
Working Group. The Report tries to put in place the diverse views and at the same time show the path ahead by way
of making certain useful recommendations. It is hoped that these would provide valuable input to the formulation of
the Eleventh Five Year Plan

V - Labour Laws: Amendments under Consideration / Undertaken

 The Present Status of amendments in certain Acts is as under:

I – Workmen’s Compensation Act, 1923 as renamed Employees Compensation Act 1923. – Ministry of Law &
Justice New Delhi (Legislative deptt0 PUBLISHED ON 22 ND Dec 2009
The Workmen Compensation (Amendment) Act 2009 enacted by Parliament in 60 th year of Republic India.
Workmen Compensation Act 1923 Section 1 of the principal Act in subsection (1) for the word ‘WORKMEN’S the
word employee ‘ shall be substituted.
Throughout the principal Act for the words ‘Workman’ & ‘workmen’s ‘ whrever they occur the words ‘employee’
and ‘employee’s’ shall respectively be substituted.

(II) The Factories (Amendment) Bill 2005 has been introduced in the Lok Sabha on 16th August 2005. The Bill
proposes to amend the Section 66 of the
Factories Act 1948, so as to provide flexibility in the matter of employment of women during night shift with
adequate safeguards for their safety, dignity,
honour and transportation from the factory premises to their nearest point of their residence.
(III) The Payment of Wages Act, 1936, ensures that wages payable to employed persons are timely disbursed and
no unauthorized deductions are made from their wages. Presently, it covers only those employees whose wage
ceiling is up to Rs.1600/- per month. The Payment of Wages (Amendment) Bill, 2005 has received the assent of the
President on 5th September, 2005. The
Payments of Wages (Amendment) Act, 2005 (41 of 2005) has been notified by the Ministry of Law and Justice on
6th September, 2005. Subsequently, the Ministry of Labour and Employment has issued notification No. SO
1577(E) dated the 8th November 2005 to enforce the amended provisions w.e.f 9 th November 2005 . With the
amendments, the wage ceiling for applicability of the Act, gets increased from Rs.1600/- to Rs.6500/- per month
while empowering the Central Government to further increase the ceiling by way of Notification. It also enhances
the penal provisions.
(IV) The Cabinet had approved a proposal to amend the Labour Laws (Exemption from Furnishing Returns and
Maintaining Registers by Certain Establishments) Act, 1988 on 11.05.2005, which intends to introduce simplified
forms of registers to be maintained by the employees under certain labour laws. The amendments proposed include
applicability of the Act to the establishments employing up to 500 persons instead of 19 persons, as at present.
Consequently, establishments, which employ not more than 500 persons, shall not be required to file multiple
returns and maintain separate registers under various labour laws. This will result in reducing the number of
registers from 53 to 2 and number of returns from 11 to 1 under various labour laws, allowing maintenance of
registers on computers and transmitting the annual reports or other reports by e-mail, enhancing the applicability of
these provisions from 16 Scheduled Acts instead of 9, at present and 20 prescribing uniform penalty for obstruction
and non-maintenance of records under the Scheduled Acts. The Bill was introduced in Rajya Sabha on
22.08.2005. Subsequently it was referred to Parliamentary Standing Committee on Labour for its examination. As
directed by the Committee , two tripartite meetings were held with the representatives of Employers’ and
Employees’ Group on 23rd January, 2006 and 22nd June, 2006 respectively to arrive at consensus on the Bill.
However, no consensus was reached in these Meetings and further direction of the committee is awaited.
(V) Amendment of the Apprentices Act, 1961 has been introduced in the Rajya on 19th May, 2006 to provide
(i) reservation for Other Backward Classes,
(ii) related instructions to be imparted at the cost of employer and (iii) flexibility in respect of ratio’s
prescribed for Apprenticeship Scheme. The Bill has been referred to Parliamentary Standing Committee on
Labour for examination.
The Parliamentary Standing Committee on Labour examined the Bill on 3rd
July,2006 and decided that after receiving the recommendations of Shri M. Veerappa Moily Committee in case of
reservation for OBC, the Bill be reviewed again.
 Further amendments to certain other labour laws like the Payment of Bonus
Act, 1965 by increasing the eligibility and calculation ceilings from Rs.3500/- to
Rs.7500/- per month and from Rs.2500/- to Rs.3500/- per month respectively and the
Minimum Wages Act, 1948 are at various stages of consideration.