Evolution

UNIT 3 CONSTITUTION, ILO AND LEGAL

FRAMEWORKS
Objectives
After completion of this unit, you should be able to:
 understand the objectives of enacting labour legislations;
 comprehend the fundamental rights and directive principles as basis of labour
legislations;
 develop insights into the role of ILO on industrial relations in India; and
 get an overview of the Labour Codes.
Structure
3.1 Introduction
3.2 Constitutional Framework for industrial relations
3.3 Labour Legislations
3.4 International Labour Organisation
3.5 Labour Codes
3.6 Summary
3.7 Self-Assessment Questions
3.8 Further Readings

3.1 INTRODUCTION
The partnership between workers and employer is one of the pillars of maintaining
production and building up of national economy. Industrial harmony inevitably leads
to better cooperation between employers and employees, which results in higher
productivity and Cooperation and sensitivity towards each others’ needs and interests
and those of community is the basic requirement for attaining harmony not just in
industry but in community at large. To achieve this, workers and employers, besides
safeguarding their own rights, must also respect the rights of others. It is important that
each party understands its duties and obligations. The rights of one party become
duties of another. In this regard it is the responsibility of the employers and the State to
ensure the well-being of workers, protect their rights and secure to them the fair
wages and remuneration to enable them to have a good standard of living. The
constitution of India provides the basic framework for understanding the rights and
duties, which apply to every dimension of society, including industry.
Labour laws are enacted so as to provide legal framework within which industry may
operate. Labour is in the Concurrent List on which both the Centre as well as the
States are competent to make laws. Article 254 provides that in case of any clash
between the Union and the State legislation, the Union legislation shall prevail. Provisions
of the labour legislations cannot be repugnant to the Constitution of India. 35
Industrial and Employment
Relations An Overview 3.2 CONSTITUTIONAL FRAMEWORK FOR
INDUSTRIAL RELATIONS
The constitution of India was adopted on 26 January 1950. Constitution was framed
such that it ensures justice, equality of status and equal opportunity to all the citizens of
India. It provides basic principles for governance. The Indian Constitution acts as guide
to all legislations including labour legislation. It requires the creation of Welfare State.
The Constitution of India has guaranteed some Fundamental Rights to the citizens and
has also laid down certain Directive Principles of State Policy for the achievement of a
social order based on justice, liberty, equality and fraternity.
Preamble
The Preamble of the Constitution states the objective which the constitution seeks to
stablish and promote. These provisions are not enforceable by the court of law. It
secures all the citizens’
 Justice- social economic and political;
 Liberty of thought, expression, belief, faith and worship;
 Equality of status and of opportunity; and
 Fraternity, dignity of individual and integrity of nation.
These principles enshrined in Preamble of the Constitution influence all legislations and
their interpretation to ensure social justice and social equity. All labour legislations are
inclined towards labour, the weaker party as compared to capitalist, due to the philosophy
of the Preamble.
Fundamental rights
Fundamental rights are mentioned in the part III of the Constitution (Article 14 to
35).These are:
 The right to equality (Article 14 to 18)
 The right to freedom(Article 19 to 22)
 The right against exploitation (Article 23 to 24)
 The right to freedom of religion (Article 25 to 30)
 Cultural and educational rights (Article 29 to 30)
 The right to constitutional remedies (Articles 32 to 35)
Article 16 of the Constitution guarantees equal opportunity to all the citizens in matter
of appointment to any office for any other employment under the State.
Article 19 provides freedom of association, freedom to carry on trade or business and
freedom of speech, which are relevant to industrial relations.
Article 21 provides that no citizen shall be deprived of his life or personal liberty except
according to legal procedure.
Article 23 and 24 guarantee right against exploitation, clause 1 of Article 23 prohibits
36 traffic of human beings and any form of forced labour and make them punishable offence.
Article 24 prohibits employment of children below the age of 14 years in factories, Constitution, ILO and
Legal Frameworks
mine or any other hazardous work. This ensures the protect health and well-being of
children.
Article 32 to 35 guarantee right to Constitutional remedies. The right empowers citizens
to approach the Supreme Court or High Court if their rights are violated. The Court
can issue directives to restore the rights.
These rights form the foundation of all legislations and provide a framework for industrial
relations
Directive Principles of State Policy
Articles 36 to 51 in the part IV of the Constitution contain Directive Principles. These
are some basic principles or guidelines for the government for formulating policies of
the country and in implementing them. The motive behind Directive Principles is to
establish social and economic democracy in the State. The objective is to create a
‘Welfare State’.
The Directive Principles of State Policy are non-justiciable, that is, they are not
enforceable by the court. The constitution mentions that these principles are fundamental
in the Governance of the country and it shall be the duty of the State to apply these
principles in making laws. The Directive Principles impose a moral obligation and not
legal obligation on the State for their implementation.
Articles 39, 41, 42 and 43 have a special relevance in the field of industrial legislation
and adjudication.
Article 38: Article 38 provides that(1)The State shall strive to promote the welfare of
the people by securing and protecting as effectively as it may a social order in which
justice, social, economic and political, shall inform all the institutions of the national
life. (2) The State shall, in particular, strive to minimise the inequalities in income, and
endeavour to eliminate inequalities in status, facilities and opportunities, not only amongst
individuals but also amongst groups of people residing in different areas or engaged in
different vocations.
Article 39: According to Article 39, the State shall, in particular, direct its policy
towards securing—
(a) that the citizens, men and women equally, have the right to an adequate means
of livelihood;
(b) that the ownership and control of the material resources of the community are
so distributed as best to subserve the common good;
(c) that the operation of the economic system does not result in the concentration
of wealth and means of production to the common detriment;
(d) that there is equal pay for equal work for both men and women;
(e) that the health and strength of workers, men and women, and the tender age
of children are not abused and that citizens are not forced by economic
necessity to enter avocations unsuited to their age or strength; (f) that children
are given opportunities and facilities to develop in a healthy manner and in
conditions of freedom and dignity and that childhood and youth are protected
against exploitation and against moral and material abandonment. 37
Industrial and Employment Article 39A: The State shall secure that the operation of the legal system promotes
Relations An Overview
justice, on a basis of equal opportunity, and shall, in particular, provide free legal aid,
by suitable legislation or schemes or in any other way, to ensure that opportunities for
securing justice are not denied to any citizen by reason of economic or other disabilities.]
Article 41: The State shall, within the limits of its economic capacity and development,
make effective provision for securing the right to work, to education and to public
assistance in cases of unemployment, old age, sickness and disablement, and in other
cases of undeserved want.
Article42: The State shall make provision for securing just and humane conditions of
work and for maternity relief.
Article43: The State shall endeavour to secure, by suitable legislation or economic
organisation or in any other way, to all workers, agricultural, industrial or otherwise,
work, a living wage, conditions of work ensuring a decent standard of life and full
enjoyment of leisure and social and cultural opportunities and, in particular, the State
shall endeavour to promote cottage industries on an individual or co-operative basis in
rural areas.
Article 43A: The State shall take steps, by suitable legislation or in any other way, to
secure the participation of workers in the management of undertakings, establishments
or other organisations engaged in any industry.
Activity 1: In nut shell elucidate the alcove mentioned articles and their application
in industries citing examples.
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3.3 LABOUR LEGISLATIONS

The term Labour Law refers to the body of laws that deal with employment and non-
employment, wages, working conditions, trade unions, social security and labour welfare
industrial relations. Their objective is to provide economic and social security to workers
and regulate the work conditions so as to help in maintaining industrial harmony. Under
the Constitution of India, Labour is a subject in the Concurrent List where both the
Central and State Governments are competent to enact legislation subject to certain
matters being reserved for the Centre.
Principles of labour legislations
Important objectives of Labour legislation include social justice, social welfare,
protection of worker interest, social security, regulation of work conditions and economic
development. Labour laws are based on certain principles: These are as following:
Principle of protection
Labour legislations aim to protect workers’ rights and interest in industries. The individual
workers are economically weak. They have little bargaining power to negotiate with
38
the employers for the protection of their rights and about wages. Therefore, there is a Constitution, ILO and
Legal Frameworks
need of legislations for protection of labour against exploitative work conditions like
long hours of work, unhygienic working conditions, low wages, employment of children
and women on dangerous operations, work during night hours, low wages and manner
of wage payment. Increasing competitiveness in industry leads to malpractices for
achieving high profitability. Humanitarian aspect at workplace is sometimes disregarded.
Many social reformers and social workers raised voice against pitiable work conditions
of workers and sought to mitigate hardships through labour legislations.
Principle of social justice
Social Justice means equality in social relationships and removing discrimination among
different classes in society. Preamble of the constitution mentions that ”‘Universal and
lasting peace can be established only if it is based upon Social Justice”.
In an industrial set up, social justice means an equitable distribution of profits and
benefits accruing from industry between industrialists and workers and affording
protection to the workers against harmful effect to their health, safety and morality.
Article 43 of the Constitution provides for a living wage. To provide social justice to
the unorganised labour and to prevent exploitation, the Minimum Wages Act, 1948,
was enacted. It provides for the fixation of minimum rates of wages by the 41
Constitutional and Legal Framework of Industrial Relations Central or State governments
within a specified period for workers employed in certain scheduled employments.
These rates vary from state to state, area to area and from employment to employment.
The minimum wage in any event must be paid irrespective of the capacity of the industry
to pay. Living wage is the higher level of wage and naturally, it would include all amenities
which a citizen living in a modern civilised society is entitled to. Fair wage is something
above the minimum wage which may roughly be said to approximate to the need-
based minimum wage. It is a mean between the living wage and the minimum wage.
Principle of regulation
The relationship between workers and employers has implication for society therefore
there is a need to regulate these relationships in order to safeguard the interest of
society. The distribution of power between the two groups in industry should be
balanced so that weaker party may not be exploited. Regulatory labour legislations
impose duties and obligations on employers and workers related in day to day
functioning of establishment, while providing them rights so that discipline may be
maintained in industry. Regulation becomes important in the formation and functioning
of trade unions, settlement of industrial disputes, functioning of dispute settlement
machinery, handling workers’ grievances and establishment of grievance handling
mechanism, managing strikes, lockout, unfair labour practices and participation of
workers in decision making.
Principle of welfare
Healthy work conditions must be provided to workers for maintaining their health and
productivity. Proper temperature, humidity etc. must be maintained at site of working.
Workers often have to work under hazardous conditions like exposure to poisonous
gases and chemicals, while working. There is a need to make provision for their health,
safety and welfare. Along with proper working conditions, workers should be provided
with certain basic amenities at the workplace and also beyond workplace to improve
39
Industrial and Employment their health and living conditions. They be should be ensured frugal amount of comfort
Relations An Overview
so that they can ensure decent living for themselves their family. Labour welfare is
required not only from humanitarian aspect but it is also important for promoting labour
efficiency and job satisfaction.
Substantial steps have been taken to fulfil the object of Article 42 of the Constitution.
The Factories Act, 1948, provides for health, safety, welfare, employment of young
persons and women, hours of work for adults and children, holidays and leave with
wages. Labour welfare funds have been set-up to provide welfare facilities to the
workers employed in different mines such as coal, mica, iron ore and limestone. The
Contract Labour (Regulation and Abolition) Act of 1970, provides for the abolition of
contract labour and to regulate the conditions of contract labour in establishments or
employments where the abolition of contract labour system is not possible for the time
being. The Act provides for licensing of contractors and registration of establishments
by the employer employing contract labour.
Principle of social security
Workers may have to face the situation of income insecurity resulting out of various
conditions. Such conditions include old age, disablement, ill health, among others, that
incapacitate them to earn their living. It is the responsibility of State and society to help
workers survive under such challenging conditions. Social security measures, provided
under the provisions of certain legislations, help workers face the contingency situations.
social security benefits are. Social security is guaranteed in our Constitution under
Articles 39, 41 and 43.
Social security may take the form of social insurance or social assistance. Social insurance
benefits are made available to the insured person. The fund for social insurance includes
the contributions made by the employer, State and the insured person. The benefits
are received as a matter of right, in the form and at the rates established by law. Social
assistance does not require contribution by beneficiaries. The finances are made available
by the State. Social assistance is not a right. It is given to the persons who need it for
the fulfilment of their minimum basic needs.
The promulgation of Employees’ State Insurance Act, 1948(ESI Act), by the Parliament
was the first major legislation on social Security for workers in independent India. The
ESI Act 1948, encompasses certain health related contingencies that the workers are
generally exposed to; such as sickness, maternity, temporary or permanent disablement,
Occupational disease or death due to employment injury, resulting in loss of wages or
earning capacity-total or partial.
The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952; the Maternity
Benefit Act,1961 are the other social security measures to help fulfil the objectives of
Directive Principles of Indian Constitution. Employees’ State Insurance Act, 1948 is
one of the first of its kind to provide social insurance to employees. The benefits provided
to the employees under the scheme are: (1) sickness benefit (2) maternity benefit (3)
disablement benefit (4) dependants’ benefit (5) funeral benefit and(6) medical benefit.
The Scheme is administered the Employees’ State Insurance Corporation.
The Provident Fund Scheme aimed at providing security by providing timely monetary
assistance to employees and their and their dependants in situations of old age,
disablement, death and other contingencies. The Employees’ Provident Fund
Organisation (EPFO) is one of the world’s largest social security organisations in terms
40 of clientele and the volume of financial transactions undertaken. administers the schemes
like the Employees’ Provident Funds Scheme, the Employees’ Pension Scheme, and Constitution, ILO and
Legal Frameworks
the Employees’ Deposit Linked Insurance Scheme.
The Maternity Benefit Act, 1961 enables a female employee to get maternity leave
with full wages. The object of the Payment of Gratuity Act, 1972, is to provide a
scheme for the payment of gratuity to employees who have rendered a minimum of 5
years’ continuous service in the specified establishments. Gratuity is provided at the
time of superannuation, retirement, resignation, death or if they leave their job due to
accident, disease or disablement.
Principle of economic development
The regulation of working conditions, ensuring welfare of workers, providing social
security, ensuring social justice and by protecting the right of workers ultimately aim at
achieving economic development of the nation. improvement of physical working
conditions, establishment of industrial peace, dispute settlement machinery, creating
forum for participation of workers in decision making, stoppage of unfair labour
practices, restrictions on activities like strikes and lockouts, all have a direct or indirect
impact on the economic development of the nation.
Besides social security benefits, efforts have also been made to provide ample
opportunities for employment and for workers’ education. The Apprenticeship Act,
1961, was enacted to supplement the programme of institutional training by on-the-
job training and to regulate the training arrangement in industry. The Employment
Exchanges (Compulsory Notification of Vacancies) Act, 1969, has made it obligatory
on the part of the employers to notify vacancies to the prescribed employment
exchanges before they are filled. To educate the workers about their rights and duties
and other aspects of work, voluntary workers’ education scheme was launched in
1958.
International uniformity in labour standards
International Labour Organisation promulgate resolutions and recommendations for
improving labour conditions. Member countries ratifying the resolutions are under
obligation to enforce them. Member countries implement these resolutions in form of
labour legislation. It provides uniformity in labour conditions internationally. India is a
member of ILO and has adopted ILO resolutions that are in accordance with the
constitutional provisions.

3.4 INTERNATIONAL LABOUR ORGANISATION

The International Labour Organization (ILO) was created in 1919, as part of the
Treaty of Versailles that ended World War I. It was formed to strengthen the belief that
universal and lasting peace can be achieved only by ensuring social justice. In 1946,
the ILO became a specialized agency of the United Nations. It has a tripartite structure,
wherein representatives of workers, employers and governments are provided a
platform to them voice for promoting decent work for all women and men.
The ILO aims at promoting social justice, recognize labour rights, and to improve their
living and working conditions and thus establish universal peace. It draws attention to
the existence of conditions of labour and emphasizes on the urgency to improve these
conditions through such means as the regulation of hours of work, provision of an
adequate living wage, protection of workers’ health and safety at workplace, protection 41
Industrial and Employment of children, young persons and women, recognition of the principle of freedom of
Relations An Overview
association, and organisation of vocational and technical education. Thus, the ILO
helps inthe creation of decent work conditions so as to create lasting peace, prosperity
and progress.
The basic principles of the Labour Policy of I.L.O. are as follows:
(a) Labour is not a commodity;
(b) Freedom of expression and of association is essential to continued progress;
(c) Poverty anywhere constitutes a danger to prosperity everywhere;
(d) War against want requires to be carried on with unending vigour within each
nation and create conditions of industrial democracy.
The three main functions of the ILO are: (i) to establish international labour standards:
(ii) to collect and disseminate information on labour and industrial conditions; and (iii)
to provide technical assistance for carrying out programmes of social and economic
development.
The ILO has four strategic objectives i.e. to
 Promote and realize standards and fundamental principles and rights at work;
 Create greater opportunities for women and men to decent employment and
income;
 Enhance the coverage and effectiveness of social protection for all; and
 Strengthen tripartism and social dialogue
India is a founder member of the ILO. The membership of the ILO ensures the growth
of tripartite system in the member countries. All the three parties have representation
in all the deliberative organs of the ILO.
Structure of ILO
The ILO has three main bodies that are comprised of the three stakeholders - employers,
workers and States. These bodies are as follows:
 International Labour Conference: The International Labour Conference
is the main organ of the ILO and acts as the legislative wing of the Organisation.
The General Conference elects the Governing Body, adopts the ILO’s biennial
programme and budget, adopts international labour standards in the form of
Conventions and Recommendations and provides a forum for discussion of
social and labour issues in an annual meeting of governments’, workers’ and
employer’s delegates of the ILO member States.
The meetings of the Conference are held normally every year, and are attended
by four delegates from each member state, of whom two are government
delegates and one each representing employers and the working people of
the state, respectively.
The objective of the conference is to discuss the broad policies of the ILO,
establish and adopt international labour standards and elect the governing
body.
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  Governing Body:It is the executive body of the ILO and is responsible for Constitution, ILO and
Legal Frameworks
making policy decisions, setting the agenda for the International Labour
Conference, adopting a budget, and electing the Director-General. It is
composed of 56 titular members of which 28 represent governments and 14
seats are held by employers and workers each. Ten of the titular government
seats are non-elected, permanent seats held by States of industrial importance.
India is one of these nations.
 International Labour Office: It is the secretariat of ILO for all conferences
and other meetings. It is also responsible for the day-to-day implementation
of the administrative and other decisions of the Conference, and the Governing
Body. The Director-General is the chief executive of the International Labour
Office. It provides assistance to member states on labour related issues. It
also serves keeps a record of information on all labour matters.
International labour standards - ILO conventions
The international labour standards take the form of Conventions and Recommendations.
These standards comprise the basic rights of labour. These are known as the International
Labour Standards (ILS). These standards deal with the rights of human beings at
work. These Conventions and Recommendations taken together are known as the
“International Labour Code”.
The Conventions and Recommendations of the International Labour Organization relate
to verify the subject on basic Human Rights of working class having a direct bearing on
the cause of social justice and everlasting universal peace which is most focused
objectives of the International Labour Organization.
The ILO main mode of action of the ILO is the setting up the International Labour
Standards in the form of Conventions and Recommendations. Conventions are
international treaties and are tools which create legally binding obligations on the nations
that ratify them. Recommendations are non-binding and set out guidelines for designing
national policies and actions. International labour standards are usually applied through
national law and policy.
The ILO adopted has adopted a number of Conventions and Recommendations that
cover a broad range of labour issues including hours of work, employment of women,
children and young persons, weekly rest, holidays, leave with wages, night work,
industrial safety, health, hygiene, labour inspection, social security, labour-management
relations, freedom of association, wages and wage fixation, productivity, and
employment.
A Convention is ratified by a country when laws and practices of the country are in
consonance with the ILO Convention. India has always had a positive approach towards
ILO Conventions and has ratified over 40 Conventions of the ILO. The ILO
recommendations and conventions have provided useful guiding principles and a sound
context for evolving legislative measures and developing administrative procedures for
the protection and advancement of the interest of labour. ILO Conventions have
significantly influenced enactment of Indian labour legislations as a standard of reference.
The ILO Conventions have always provided an important basis for Indian labour
legislations, particularly after Indian independence. Not only the ILO standards have
played a key role on legislations related to factories, mines, social security and wages
43
Industrial and Employment in India, the Conventions on basic human rights have had a significant impact on
Relations An Overview
legislations, in general. The ILO, thus has greatly influenced the industrial relations in
our country. It has been instrumental in improving the condition of the working class in
India and adoption of the philosophy of tripartism as a method for resolving labour-
management conflicts.
Core Conventions of the ILO: - The eight Core Conventions of the ILO (also called
fundamental/human rights conventions) are:
1. Forced Labour Convention (No. 29)
2. Abolition of Forced Labour Convention (No.105)
3. Equal Remuneration Convention (No.100)
4. Discrimination (Employment Occupation) Convention (No.111)
5. Minimum Age Convention (No.138)
6. Worst forms of Child Labour Convention (No.182)
7. Freedom of Association and Protection of Right to Organised Convention
(No.87)
8. Right to Organise and Collective Bargaining Convention (No.98)
(Conventions 1-6 have been ratified by India while 7-8 have not been ratified by
India)
As per the Declaration on Fundamental Principles and Rights at Work and its follow-
up, each member state of the ILO is expected to adopt the principles contained in the
Core Conventions of the ILO, irrespective of whether or not the Core Conventions
have been ratified by them.

3.5 LABOUR CODES

There are a number of labour legislations in India due to which the compliance becomes
a complex and cumbersome process which adversely affects the ease of doing business.
Second National Commission on Labour Laws, which submitted its report in June 2002,
had recommended that the existing set of labour laws should be merged and classified
into the four groups. To implement the recommendations, the Government has proposed
to enact four labour codes, subsuming 29 labour law legislations. These are:
1. the Industrial Relations Code 2020;
2. the Code on Social Security, 2020; and
3. the Occupational Safety, Health and Working Conditions Code, 2020
4. Code on Wages, 2019
The Industrial Relations Code 2020
Objective
The Code has the objective to enhance the progress of the country and to facilitate
ease of doing business by (i) safeguarding the rights of employers and employees
44
through labour reforms and (ii) establishing industrial peace and harmony by settling Constitution, ILO and
Legal Frameworks
industrial disputes.
It amalgamates three main core laws that relate to the settlement of labour disputes and
collective bargaining agreements, namely:
1. The Trade Unions Act, 1926
2. Industrial Employment (Standing Orders) Act, 1946
3. The Industrial Disputes Act, 1947
Key features
The key features of the Industrial Relations Code, 2020 can be described as following:
 The definition of worker has been broadened and now includes working
journalists, employees of Sales promotion and Persons employed in a
supervisory capacity earning less than Rs. 18,000 per month (or any amount
notified by the Central Government).
 Provides a legal basis for fixed-term employment, allowing employers greater
flexibility to hire in accordance with the need. Fixed-term employees have
been given equality with permanent employees concerning working conditions,
wages, allowances, and other benefits.
 The threshold limit for applicability of the Code in an industrial establishment
is 300 or more employees, with power being granted to the “appropriate
government” to exempt any industrial establishment or class thereof from all
or some of the provisions of the Code.
 In case of multiplicity of unions in an establishment, the status of bargaining
union will be granted to the one with 51% of the employees as members.
Provision for the establishment of a bargaining council made up of
representatives of the various unions, with at least 20% of employees as
members.
 the establishments where this Code is applicable must obtain prior permission
from the Government for layoffs, staff reductions and closure.
 Industrial Relations Code 2020 defines “strike” as including the concerted
casual vacation on a given day of fifty percent or more of the workers in an
industry. No employee can strike without reporting a strike to the employer
14 days in advance. This notification is valid for a maximum of 60 days.
Likewise, no employer can lockout without giving 14 days notice of the lockout.
This notification is valid for a maximum of 60 days.
 Employers are required to report to the relevant government and arbitration
officer within five days of receiving/announcing a strike/lockout.
 Provisions regarding standing orders will apply to the establishments that have
had 300 or more employees on any day in the preceding twelve months or a
year.
 An employer will be required to prepare a draft of standing orders, based on
the Central Government model standing order, within 6 months from the code
start date, in consultation with recognized bargaining unions or members of
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Industrial and Employment the negotiating council concerning the same and it must be certified by the
Relations An Overview
certifying officer.
 Provisions for the creation of a “reskilling fund” for employees laid off from
the industrial establishment by the employer, with employer contribution,
equivalent to 15 days of salary as the last retirement of the worker immediately
before being laid off and from other sources as prescribed.
 Non-seasonal industrial establishments with at least 300 workers are required
to take prior approval from central or state government before lay-off,
retrenchment or closure
 The provisions on lay-off and retrenchment do not apply to industrial
establishments with less than 50 workers on an average per working day or
seasonal industrial establishments.
 Employers are required to give to every worker who has completed at least
one year of continuous service:
 50% of basic wages and dearness allowance if he is laid off, and
 one month’s notice (or equivalent wages) and 15 days’ wages for every year
of continuous service for such a period to a worker who has been retrenched.
 Any industrial establishment employing more than 20 employees must have
one or more complaint redressal committees for the resolution of disputes
arising from individual complaints. The committee should be made up of an
equal number of members representing employers and workers, and the chair
should be elected, alternately, from among employees and workers, on a
rotating basis each year.
The Code on Social Security, 2020
Objective
Social Security Code, 2020 aims at amending, consolidating and rationalizing the relevant
provisions of the nine central labour enactments relating to social security. The objective
is to extend social security to all employees and workers in the organized/ unorganized
or any other sectors.
The Code has amalgamated the following 09 enactments:
1. The Employees’ Compensation Act, 1923
2. The Employees’ State Insurance Act, 1948
3. The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952
4. The Employment Exchanges (Compulsory Notification of Vacancies) Act,
1959
5. The Maternity Benefit Act, 1961
6. The Payment of Gratuity Act, 1972
7. The Cine- Workers Welfare Fund Act, 1981
8. The Building and Other Construction Workers Welfare Cess Act, 1996

46 9. The Unorganised Workers’ Social Security Act, 2008.

Key Features Constitution, ILO and
Legal Frameworks
 Every establishment to which SS Code applies shall be required to be registered
within such time and in such manner as may be prescribed by the Central
Government
 Creation of national database of online portals by making the registration
procedure simple and at single platform
 Maintenance of electronic database to maintain all records and returns
 Uniformity in definition of Wages, Employer, home based workers, Self-
employed workers etc.
 Introduction of the provisions for Social Security Organization to maintain
finance and accounts and frame a budget as well
 Financing the EPF, EPS, and ESI schemes through contributions from the
employer and the employee. In case of EPF, the employer and the employee
each will make contributions of 10% of wages
 Provision of procedure for re-employment of retrenched workers
 Widening the definition of the employee include maximum number of employees
and workers.
 Provision of social security and protection to the workers in the unorganized
sector to ensure access to health care and to provide income security,
particularly in cases of old age, unemployment, sickness, invalidity, work injury,
maternity or loss of a breadwinner by means of rights conferred on them and
schemes framed, under this Code.
 Obligation on the Central Government to constitute the National Social Security
Board for the welfare of the unorganised worker as well as for the gig workers
and platform workers and can recommend and monitor the schemes for such
worker. The Central Government will setup and administer the social security
fund for the welfare of such workers.
 Introduction of the concept of Gig worker. A gig worker means a person who
performs a job temporarily/part time basis/ hourly basis. The code defines gig
worker as ‘a person who performs work or participates in a work arrangement
and earns from such activities outside of traditional employer-employee
relationship’. Platform based work is where workers earn money by providing
specific services or to solve specific problems through online platform.
Generally unorganized workers means a home-based worker, self-employed
worker or a wage worker in the unorganised sector.
 Provision of compulsory registration of the every unorganised worker, gig
worker and platform workers to avail the benefit of the concerned scheme
framed under this code, subject to the prescribed conditions
 The code has revised the applicability of the Employees Provident Fund
Scheme such that it will apply to the establishment employing 20 or more
employees. The Central Government may establish the Provident fund where
the contribution paid by the employer to the fund shall be 10% of the wages 47
Industrial and Employment for the time being payable to each of the employees (whether employed by
Relations An Overview
him directly or by or through a contactor), and the employee’s contribution
shall be equal to the contribution payable by the employer.
 Employees State Insurance scheme will apply to establishment employing 10
or more employs. It is also be applicable to an establishment, which carries
on such hazardous occupation as notified by the Central Government, even if
a single employee is employed. The code covers the gig workers and platform
workers under the ESI scheme.
 Every establishment in which 10 or more employees are employed, or were
employed, on any day of the preceding 12 months, shall pay gratuity to their
eligible employees. Gratuity shall be payable to an employee on the termination
of his employment after he has rendered continuous service for not less than
five years.
 No woman shall work in any establishment during the six weeks immediately
following the day of her delivery, miscarriage or medical termination of
pregnancy. every woman shall be entitled to the payment of maternity benefit
at the rate of the average daily wage for the period of her actual absence.
The Occupational Safety, Health and Working Conditions Code, 2020
Objective
Occupational Safety, Health and Working Conditions Code, 2020 aims to consolidate
and amend the laws regulating the occupational safety, health and working conditions
of the persons employed in an establishment.
Laws subsumed
 The Factories Act, 1948;
 The Contract Labour (Regulation and Abolition) Act, 1970;
 The Inter-State Migrant Workmen (Regulation of Employment and Conditions
of Service) Act, 1979;
 The Building and Other Construction Workers (Regulation of Employment
and Conditions of Service) Act, 1996;
 The Mines Act, 1952;
 The Dock Workers (Safety, Health and Welfare) Act, 1986;
 The Plantations Labour Act, 1951;
 The Working Journalists and Other Newspaper Employees (Conditions of
Service) and Miscellaneous Provisions Act, 1955;
 The Working Journalists (Fixation of Rates of Wages) Act, 1958;
 The Motor Transport Workers Act, 1961;
 The Sales Promotion Employees (Condition of Service) Act, 1976;
 The Beedi and Cigar Workers (Conditions of Employment) Act, 1966; and
 The Cine Workers and Cinema Theatre Workers Act, 1981
48
Key features Constitution, ILO and
Legal Frameworks
The salient features of the OSHW Code are as follows:

 The OSHW Code is applicable to:

o every establishment where any industry, trade, business, manufacturing or
occupation is carried on in which ten or more workers are employed; or
o a factory, motor transport undertaking, newspaper establishment, audio-
video production, building and other construction work or plantation, in
which ten or more workers are employed; or
o a mine or port or vicinity of port where dock work is carried out.
 For effective implementation of the OSHW Code, appointment of Inspector-
cum-Facilitators has been prescribed.
 The appropriate Government has been granted the power to declare any
place wherein a manufacturing process is carried on as a ‘factory’ irrespective
of the number of workers working in the factory.
 To reduce multiplicity of registration under various existing laws
 Duties of employer inter alia include ensuring that the workplace is free from
hazards, complying with occupational safety and health standards, providing
annual health examination, issuing a letter of appointment to every employee,
compulsory reporting of diseases and accidents etc.
 Duties of employees inter alia include taking reasonable care for the health
and safety of himself and co-operate with the employer in meeting the statutory
obligations.
 The employer is responsible for maintaining healthy working conditions by
ensuring proper hygiene, cleanliness, ventilation, humidification and providing
arrangements for treatment of wastes and effluents in the establishment.
 Provision of welfare facilities include washing facilities, locker rooms, creche,
canteens, sitting arrangements are also to be provided and maintained by an
employer in the establishment.
 The working hours of a worker in an establishment have been fixed at 8 hours
in a day except in case of mines wherein the Central Government may notify
additional working hours.
 Employer shall be liable to pay wages at the rate of twice the rate of wages to
workers consenting to work overtime.
 Women shall be entitled to be employed in all establishments for all types of
work and may also work before 6:00 A.M. and beyond 7:00 P.M. subject to
conditions relating to safety, holidays and working hours.
 The provisions relating to contract labour are applicable to (i) every
establishment in which 50 or more contract labour are employed or were
employed on any day of the preceding 12 months through contract (ii) every
manpower supply contractor who has employed on any day of the preceding
12 months 50 or more contract labour.
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Industrial and Employment The Code on Wages, 2019
Relations An Overview
Objectives
The Code on Wages, 2019 amalgamates and simplifies the provisions of 4 Central
Labour Laws related to wages, bonus and matters connected therewith or incidental
thereto. Following laws have been subsumed:
 The Payment of Wages Act, 1936
 The Minimum Wages Act, 1948
 The Payment of Bonus Act, 1965
 The Equal Remuneration Act, 1976
Key Features
 The Wage Code envisages uniform applicability of the provisions of timely
payment of wages and minimum wages to all employees irrespective of the
amount of wage and sectors.
 Eliminates the multiplicity of wage definitions to reduce compliance burden on
employers. As per Wage Code, the term ‘wages’ means all remuneration
whether, by way of salaries, allowances or otherwise, expressed in terms of
money and includes basic pay; dearness allowance; and retaining allowance if
any.
 Provides separate definitions of ‘worker’ and ‘employee’.
 Empowers the appropriate government to fix wages in all industries.
 Introduction of the concept of ‘floor wage’. The Central Government is
empowered to fix floor wage. State Government is restricted from lowering
the minimum wages below the ‘floor-wage’.
 The minimum wages are to be reviewed and revised by the appropriate
governments and not just an inspecting authority.
 The dispute of fixation of bonus or eligibility for payment of bonus be deemed
to be considered as an ’industrial disputes’.

3.6 SUMMARY
Industrial harmony inevitably leads to better cooperation between employers and
employees, which results in higher productivity. Industrial harmony inevitably leads to
better cooperation between employers and employees, which results in higher
productivity and Cooperation. The Preamble of the constitution states the objective
which the constitution seeks to establish and promote. Fundamental rights form the
foundation of all legislations and provide a framework for industrial relations. Directive
principles are some basic principles or guidelines for the government for formulating
policies of the country and in implementing them. Important objectives of Labour
legislation include social justice, social welfare, protection of worker interest, social
security, regulation of work conditions and economic development. The I.L.O. aims
at promoting social justice, internationally recognize human and labour rights, and to
50 improve their living and working conditions and thus establish universal peace. The
international labour standards take the form of Conventions and Recommendations. Constitution, ILO and
Legal Frameworks
To implement the recommendations, the Government has proposed to enact four labour
codes, subsuming 29 labour law legislations.

3.7 SELF-ASSESSMENT QUESTIONS

1. How do fundamental rights provide a basis for labour legislations?
2. Describe the salient features Wage Code 2019.
3. Explain the role of the ILO in improving labour conditions in India?
4. How do labour legislations in India ensure labour welfare?
5. Explain the principle of social security of labour legislations.
6. Which provisions of Directive principles of State Policy shape industrial relations?
7. Explain the salient features of Industrial Relations code, 2020.
8. Elucidate the important features of Occupational Safety, Health and Working
Conditions Code, 2020.

3.8 FURTHER READINGS

 Seervai, H. M. (2015). Constitutional law of India. Prayagraj: Universal Law
Publishing.
 Choudhry, S. , Khosla, M., Mehta, P.B. (2016). The Oxford Handbook of the
Indian Constitution. New Delhi: Oxford University Press
 Kumar, J.N. and Bhola, A.(2008).International Labour Organisation (ILO).
New Delhi: Regal Publications

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