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LABOUR LAW POLICY OF INDIA

 INTRODUCTION
WHAT IS LABOUR LAW ?
Labour law is the body of laws, which address the legal
rights and restrictions on working people and their
organizations. As such, it meditates many aspects of the
relationship between trade unions, employers and
employees. In simple words, labour law defines the rights
and obligations as workers, union members and
employers in the workplace.
 ORIGINS OF LABOUR LAW
 The History of labour legislation in India can be traced back to of
British colonialism. The Indian Slavery Act, 1843 was an act
passed by British India under East India Company Rule, which
outlawed many economical transaction associated with Slavery. It
Banned the act of buying and selling of slave and anyone find
guilty of this offence would be booked under Indian Panel Code
with an offence carrying strict punishment.
 After freedom laborer were deprived of their Rights At
Workplaces, they were paid less for their work as same as It was
happening Before Freedom the only thing changed was
Employers After going through such conditions they formed
various unions and Start Strikes which raised there voice in the
Ears of Indian Government and finally in 1950 Government
Embedded Indian labour laws in the Constitution.
 Need & Objectives
 The need for Minimum Standard Wages,
Standard Hours and Overtime Payments.
 The need to maintain a Hazard Free work
Environment.
 The need to provide Protection from
Disability Discrimination.
 The need to provide Age and Gender
Equality.
 The need to provide Protection from
Retaliation
 VISION BY
MINISTRY OF LABOUR
AND EMPLOYMENT
Decent working conditions and improved
quality of life of workers, ensuring India
without child labor in hazardous sectors and
enhancing employability through
employment services and skill development
on a sustainable basis.
 SOCIAL SECURITY
1.THE PAYMENT OF GRATUITY
RULES,1972.
2.EMPLOYEES COMPENSATION ACT,1923
3.MATERNITY BENEFIT,1961
4.EMPLOYS LIABILITY ACT,1938.
5.EMPLOYEES PROVIDENT FUND & MISC.
PROVISIONS ACT,1952.
 PAYMENT OF GRATUITY ACT-1972
Meaning of the Act:- Gratuity is derived from the earlier latin word “Gratuitous” which means
“Gift” or “Present”. Gratuity is a Lump sum Payment to employee when he/ she Retires or
Leaves the Service. It is Basically a Retirement Benefit so that they can live their life
Comfortably after Retirement.
Applicability of the Act:- The Act shall apply to whole India. The act applies to all factories,
mines, oilfield, plantation, port and railway company. But in case of shops or establishments
other than those stated before, it applies to those orgnisations with 10 or more persons are
employed on any day of the preceding 12 months. 
Eligiblity:- Any Person (other than Apprentice) who is employed on wages, to do any skilled,
semi-skilled or Unskilled, Manual, Supervisory, Technical or Clerical Work , whether terms of
such Employment are express or implied, and whether such Person is Employed in a Managerial
or Administrative capacity.
Payable on:- (a) Resignation (b) Termination on account of Death or Disablement due to
Accident or Disease (c) Retirement (d) Death. Normally, Gratuity is payable only after an
Employee completes Five Years of Continuous service. “In case of Death and Disablement, the
condition of minimum 5 years’ service is not applicable”
Amount payable:- Gratuity is Payable @ 15 days wages for Every year of Completed service.
In the last year of service, if the employee has completed more than 6 months, it will be treated
as full year for purpose of gratuity. “In case of seasonal Establishment, Gratuity is Payable @ 7
days wages for each season.”
“Wages will be consist of Basic plus D.A, as per Last Drawn salary. Bonus,
Commission, HRA etc shall not be included in calculation of GPA”
 PAYMENT OF GRATUITY ACT-1972
MAIN AMENDMENT
1.In section 2A of Principal act, in sub section(2)’s explanation clause
(iv) the words “Twelve week” is substituted by “such period as may be
notified by the central government from time to time”
(This amendment abolish the particular “twelve week” policy for
maternity leave in case of female employe)
1.In section 4 of the Principal act, in sub section(3) the words “Ten lakh
rupees” were substituted by “such amount as may be notified by the
central government from time to time”.
(This amendment abolish the particular maximum amount of “Ten
lakh rupees” for gratuity payment)
 EMPLOYEES COMPENSATION ACT,1923
Meaning of The Act:- the Employees Compensation Act,1923 imposes statutory liability upon
an employer to discharge his moral obligation towards employees when they suffer from any
physical disabilities or diseases, during the course of employment in hazardous working
condition.
Applicability of the Act:- This Act apllies to Mines, Factories, Plantations, Transport
Establishments, Construction works, Railways, Ships & circuses.
Eligiblity:- Any Person who is employed on wages, to do any skilled, semi-skilled or Unskilled,
Manual, Supervisory, Technical or Clerical Work , whether terms of such Employment are
express or implied, and whether such Person is Employed in a Managerial or Administrative
capacity.
Payable on:- Employer is liable to pay as soon as it falls due. If the employer didn’t pay the
compensation under one month from date of due he had to pay in addition the interest of 12% per
annum or higher not exceeding the maximum of lending rate of scheduled bank as may be
specified by central government.
Amount payable:- 1. In case of accidents resulting in death: an amount equal to fifty per cent.
of the monthly wages of the deceased multiplied by the relevant factor; or an amount of Rs
1,20,000, whichever is more;
2. If the accident results in permanent total disablement: an amount equal to 60 per cent. of
the monthly wages of the injured employee multiplied by the relevant factor; Rs 1,20,000,
whichever is more.
 EMPLOYEES COMPENSATION ACT,1923
MAIN AMENDMENTS
1. New section inserted namely 17A:-“Every employer shall
immediately at the time of employment of an employee, inform the
employee of his rights to compensation under this Act, in writing as well
as through electronic means, in English or Hindi or in the official
language of the area of employment, as may be understood by the
employee”.
2. Fails to inform 17A:- The employer shall be punishable with fine
which shall not be less than 50,000 but which may extend to 1,00,000.
3. Appeal amount 30(1):-The amount in dispute in the appeal in not less
than 10,000 rupees or such amount as the central government may
notify.
4. Section 30A omitted:-This Act provides for withholding of amounts
payable to the employee through the commissioner’s order, If the
employer has appealed against such order in the high court. It is now
omitted.
 MATERNITY BENEFIT ACT,1961
Meaning of the Act:-“An act to Regulate the Employment of Women in certain Establishment
for certain period before and after Child-Birth & to provide for Maternity Benefit & Certain other
benefits”
Applicability of the Act:- The Act extends to whole of India. In the first instance, to every
establishment being a Factory, Mine or Plantation in which 10 or More persons are or were
employed on any day of the preceding (12) Twelve months
Eligiblity:- Every Pregnant working women in any Establishment are Eligible for Maternity
Benefit, provided they have Served in the Establishment for at least 80 days in (12) Twelve
months before the expected date of delivery. A woman who legally adopt child below the age of
3 months is also eligible for maternity benefit.
Notice to the Employer:- Ten (10) weeks before the date of her expected delivery, she may ask
the Employer to give her light work for a Month. She should give written Notice to the
Employer about Seven (07) weeks before the date of her delivery that she will be on Maternity
Leave for Six weeks before & after her delivery.
Amount payable:- 1. Leave with Average Pay for 26 week, up-to 2 children’s. In case of more
than 2 children these benefit will be for 12 weeks only. Employee can avail this 8 week before
delivery or she can avail 26 weeks together immediate proceeding for delivery.
2. She is also eligible for 12 weeks of leave with wages in case she adopts a child below age of 3
months.
3. Two nursing breaks until the child will become 15 months old.
Penalty for contravention of Act:- the employer shall be punishable with imprisonment which
shall not be less than 3months and extend to 1 year and fine from 20,000 to 50,000.
 MATERNITY BENEFIT ACT,1961
MAIN AMENDMENTS
1.New clause added section 3ba:- this clause add a new definition for commissioning mother
“commissioning mother means a biological mother who uses her egg to create an embryo
implanted in any woman”.
2.New proviso added:- “provided that the maximum period to entitled to maternity benefit by a
woman having two or more than two surviving children shall be twelve weeks of which not more
than six weeks shall precede the date of her expected delivery”
3.New section added 11A:- which states that there should be a facility of creche within such
distance as may be prescribed, either separately or along with common facilities also the
employer shall allow 4 visit a day to the creche which also include the interval for rest allowed to
her.
 EMPLOYERS LIABILITY ACT,1938
Meaning of the Act:- An Act to declare that certain refences shall not be raised in suits for
damage in respect of injuries sustained by workmen
Applicability of the Act:- It extends to the whole of India.
Eligiblity:- Includes any body of persons whether incorporated or not, any managing agent of an
employer and, the legal representative of a deceased employer, and where the services of a
workman are temporarily lent or let on hire to another person by the person with whom the
workman has entered into a contract of service means such other person while the workman is
working for him.
Main objective:- 1. The doctrine of common employment, by which the empolyer is not
normally liable to pay damages to a workman for an injury resulting from the default of another
workman.
2. The doctrine of assumed risk, by which an employer is presumed to have accepted a risk if it is
such that he ought to have known it to be part of he risks of his occupation.
Risk not to be deemed if employ has no full knowledge:- In any such suit for damages, the
workman shall not be deemed to have undertaken any risk attaching to the employment unless
the employer proves that the risk was fully explained to and understood by the workman and that
the workman voluntarily undertook the same.
EMPLOYEES PROVIDENT FUNDS & MISCELLANEOUS
PROVISIONS ACT,1952
MEANING OF THIS ACT:- An Act to provide for the institution of provident funds, pension
fund and deposit-linked insurance fund for employees in factories and other establishments.
Administered by Central Board Of Trustees & Employee Provident Fund Organization (EPFO)
Applicability of the Act:- To whole India.
Eligibility:- Every factories or Establishments Employing 20 or More Persons from the date of
its setup are covered under the Act. Cinema Theatres employing 5 or more persons are covered
from the Act.
Wages:- (Basic+DA) Max limit 15,000
Benefits:-
1.Tax free savings:- contribution + interest@8%(under section 80c of income tax)
2.Post retirement benefits:- full payment of EPF & EPS (minimum service of 10 years)
3.Los of income:- if jobless for 2 months & more withdraw your EPF
4.Life insurance:- EDLI Relief to family member in case of sudden death
5.Universal access:- Universal Account number(UAN), Transfer EPF from old employer to new
employer hassle free.
 PF Contribution Account-wise w.e.f “April 01,
2019”
Employee’s Employer’s Share
Share (to EPF & Pen. fund) Ac : 01
& 10
(to EPF Fund) AC: 01

@ 12 % of Basic +
DA (Ac: 01) @ 3.67% of Basic + @ 8.33% of Basic +
DA DA

EPF Total in Ac. 01: @ EPS Total in Ac. 10: @

15.67% or 8.33%
Total Contribution to EPF & Pension Fund , Ac: 01 & 10 ( @ 15.67 + 8.33 ) = 24
% PF Administrative Charges in Ac: 02 ( @ 1.11 % of Basic + DA) (By
Employer)
(Minimum ₹ : 500/- functional & ₹ : 75/- for non functional Org.)
Contribution to EDLI Ac:21 @ 0.5 % of Basic & DA (By Employer)
(Minimum ₹ : 200/- functional & ₹ : 25/- for non functional Org.)
Total Monthly Contribution in { Ac 01, 10, 02, 21 & 22 }

Employee Contribution:-12%, Employer Contribution:-13.61%

W.e.f: April 01, 2019: (12%+{12%+1.11%+0.50%})= @ 25.61
 Labour Policy of India

Labour policy includes policies

concerned with relations between
employers and employees and those
concerned with the employment,
training and distribution of workers in
the LABOUR MARKET.
 Labour Policy Highlights
• Creative measures to attract public and private
investment.
• 15 lakh new jobs in the coming five years.
• A unified and consolidated legislation for social security
schemes.
• New Social security schemes for workers in the
unorganised sector.
• Social security cards for workers.
• Unified and beneficial management of funds of Welfare
Boards.
• Re-prioritisation of allocation of funds to benefit vulnerable
workers.
• Model employee-employer relationships.
• Long term settlements based on productivity.
• Vital industries and establishments declared as `public
utilities`.
 Labour Policy Highlights
• Special conciliation mechanism for projects with
investments of Rs.150 crores or more.
• Industrial Relations committees in more sectors.
• Labour Law reforms in tune with the times. Empowered
body of experts to suggest required changes.
• Referenda for recognition of trade unions.
• Statutory amendments for expediting and streamlining
the mechanism of Labour Judiciary.
• Amendments to Industrial Disputes Act in tune with the
times.
• Efficient functioning of Labour Department.
• More labour sectors under Minimum Wages Act.
• Child labour act to be aggressively enforced.
• Modern medical facilities for workers.
 Labour Policy Highlights
• Rehabilitation packages for displaced workers.
• Restructuring in functioning of employment exchanges.
Computerization and updating of database.
• Revamping of curriculum and course content in industrial
training.
• Joint cell of labour department and industries department
to study changes in laws and rules.
• Kerala Institute of Labour & Employment to be upgraded.
• Policy progress monitoring team to review progress of
implementation of policy.
 International comparison
(2019)

LAW INDIA CHINA USA

MINIMUM WAGE (US$/Month) 195.5
325.6 1256.7
(₹14,000)
STANDARD WORK HOUR (PER DAY) 9 8 8
MAXIMUM NUMBER OF WORKING DAY 6 6 6
PREMIUM FOR OVERTIME 100% 50% 0
PREMIUM FOR OVERTIME (REST DAY) 0 100% 0
RESTRICTION ON WEEKLY HOLIDAY YES NO NO
PAID ANNUAL LEAVE (WORKING 15 5 0
DAYS) IN ONE YEAR OF TENURE