Indian labour law
Indian labour law refers to laws regulating employment in India. There are over fifty national laws and many more state-level laws.
Traditionally Indian governments at federal and state level have sought to ensure a high degree of protection for workers (allegedly). For instance, a permanent worker can be terminated only for proven misconduct or for habitual absence.
- 1 Collective labour law
- 2 Individual labour law
- 3 International comparison of Indian labour laws
- 4 Doctrine of "no-work-no-pay"
- 5 Criticism of Indian labour law
- 6 See also
- 7 Notes
- 8 References
- 9 External links
Collective labour law
- The Industrial Disputes Act (1947) requires companies employing more than 100 workers to seek government approval before they can fire employees or close down. In practice, permissions for firing employees are seldom granted.
- Trade Unions Act 1926
- Provisions of the Factories Act, 1948
Individual labour law
All India Organisation of Employers points out that there are more than 55 central labour laws and over 100 state labour laws.
- The Contract Labour Act (1970) aims at regulating employment of contract labour so as to place it at par with labour employed directly. Women are now permitted to work night shifts too ( 10pm to 6am).
- Minimum Wages Act 1948
- Weekly Holidays Act 1942
- Beedi and Cigar Workers Act 1966
- The Payment of Wages Act, 1936
- The Workmen’s Compensation Act, 1923
- The Factories Act, 1948
- The EPF Act
- The Bonus Act
- The ESI Act
International comparison of Indian labour laws
The table below contrasts the labour laws in India to those in China and United States, as of 2011.
|Practice required by law||India||China||United States|
|Minimum wage (US$/month)||45 (INR 2500/month)||182.5||1242.6|
|Standard work day||8 hours||8 hours||8 hours|
|Minimum rest while at work||30 minutes per 5 hour||None||None|
|Maximum overtime limit||200 hours per year||432 hours per year||None|
|Premium pay for overtime||100%||50%||50%|
|Dismissal due to redundancy allowed?||Yes, if approved by government||Yes, without approval of government||Yes, without approval of government|
|Government approval required for 1 person dismissal||Yes||No||No|
|Government approval required for 9 person dismissal||Yes||No||No|
|Government approval for redundancy dismissal granted||Rarely||Not applicable||Not applicable|
|Dismissal priority rules regulated||Yes||Yes||No|
|Severance pay for redundancy dismissal
of employee with 1 year tenure
|2.1 week salary||4.3 week salary||None|
|Severance pay for redundancy dismissal
of employee with 5 year tenure
|10.7 week salary||21.7 week salary||None|
Doctrine of "no-work-no-pay"
In India, the Latin phrase 'dies non' is being widely used by disciplinary authorities in government and industries for denoting the 'unauthorised absence' to the delinquent employees. According to Shri R. P.Saxena, Chief Engineer, Indian Railways,Dies-non is a period which neither counted in service nor considered as break in service. A person can be marked dies-non, if
1.Absent without proper permission.
2.When on duty left without proper permission.
3.While in office but refused to perform duties.
In cases of such wilful and unauthorised absence from work, the leave sanctioning authority may decide and order that the days on which the work is not performed be treated as dies non on the principle of no work no pay. This will be without prejudice to any other action that the competent authority might take against the persons resorting to such practises.
Practice of Dies Non (No Work No Pay) in Industries
The principle of “no work no pay” is widely being used in the banking industry in India. All other manufacturing industries and large service establishments like railways,posts and telecommunications are also implementing it to minimise the incidences of unauthorised absence of workers. The term ‘industry’ infuses a contractual relationship between the employer and the employee for sale of products and services which are produced through their cooperative endeavor.
This contract together with the need to put in efforts in producing goods and services imposes duties (including ancillary duties) and obligations on the part of the employees to render services with the tools provided and in a place and time fixed by the employer. And in return, as a quid pro quo, the employer is enjoined to pay wages for work done and or for fulfilling the contract of employment.Duties generally, including ancillary duties, additional duties, normal duties, emergency duties, which have to be done by the employees and payment of wages therefor. Where the contract of employment is not fulfilled or work is not done as prescribed, the principle of ‘no work no pay’ is brought into play.
Unauthorised absence of a group of workers such as during a strike is required[by whom?]to be dealt more firmly. The rules in India provides for stern action by disciplinary authorities in such cases. Most of these actions taken by disciplinary authorities are upheld by courts also.
According to fundamental rules (FR 17A) of the civil service of India, a period of unauthorised absence-
(i) in the case of employees working in industrial establishments, during a strike which has been declared illegal under the provisions of the Industrial Disputes Act, 1947, or any other law for the time being in force;
(ii) in the case of other employees as a result of action in combination or in concerted manner,such as during a strike, without any authority from, or valid reason to the satisfaction of the competent authority;
shall be deemed to cause an interruption or break in the service of the employee, unless otherwise decided by the competent authority for the purpose of leave travel concession,quasi-permanency and eligibility for appearing in departmental examinations, for which a minimum period of continuous service is required.
Criticism of Indian labour law
Many observers have argued that India's labour laws should be reformed.      The laws have constrained the growth of the formal manufacturing sector. According to a World Bank report in 2008, heavy reform would be desirable. The executive summary stated,
|“||India’s labor regulations - among the most restrictive and complex in the world - have constrained the growth of the formal manufacturing sector where these laws have their widest application. Better designed labor regulations can attract more labor- intensive investment and create jobs for India’s unemployed millions and those trapped in poor quality jobs. Given the country’s momentum of growth, the window of opportunity must not be lost for improving the job prospects for the 80 million new entrants who are expected to join the work force over the next decade.||”|
In Uttam Nakate case, the Bombay High Court held that dismissing an employee for repeated sleeping on the factory floor was illegal - a decision which was overturned by the Supreme Court of India. Moreover, it took two decades to complete the legal process. In 2008, the World Bank criticised the complexity, lack of modernisation and flexibility in Indian regulations.
- Parul Sharma (February 2007). "Split Legal Regime in India‘s Labour Laws".
- Aditya Gupta. "How wrong has the Indian Left been about economic reforms?".
- "Employing Workers - 2011 data (based on input from ILO, OECD, local governments and private employers)". The World Bank. 2012.
- Gordon, Li, Xu (August 12 2010). "Labor regulation, economic complexity, and the China-India gap". Hamilton University.
- Adhvaryu, Chari and Sharma (December 2009). "Firing costs and flexibility:evidence from firms employment responses to economic shocks". Yale University.
- Rule 62,P&T manual Vol III, Government of India
- C.Krishnamurthi .Dies Non (No Work No Pay) in Banking Industry ISBN 978-81-8387-226-3
- Fundamental Rules, Government of India
- "IMF calls for urgent reform in Indian labour laws".
- Kaushik Basu, Gary S. Fields, and Shub Debgupta. "Retrenchment, Labor Laws and Government Policy: An Analysis with Special Reference to India". World Bank.
- R. C. Datta / Milly Sil. "Contemporary Issues on Labour Law Reform in India".
- "Economic survey of India 2007: Policy Brief". Organisation for Economic Co-operation and Development.
- Basu, Kaushik (27 June 2005). "Why India needs labour law reform". BBC.
- "India Country Overview 2008". World Bank. 2008.
- "A special report on India: An elephant, not a tiger". The Economist. 11 December 2008.
- Gurcharan Das (July/August 2006). "The India Model". Foreign Affairs.
- World Bank, India Country Overview 2008
- "New labour laws needed, says Manmohan". The Hindu (Chennai, India). 10 December 2005.
- "World Bank criticizes India's labor laws".
- E Hill, 'The Indian Industrial Relations System: Struggling to Address the Dynamics of a Globalizing Economy' (2009) 51 Journal of Industrial Relations 395-410
- List of Indian labour laws - includes only laws enacted by the central government, each Indian state has additional laws
- Post-Liberalization India and the Importance of Legal Reform by Sanjeev Sanyal
- Provisions of the Factories Act, 1948
- Deadly Labor Wars Hinder India's Rise