Desired Amendments to Factories Act and Labour Laws
The Factories Act and all statutes under the domain of Labour Laws need a drastic overhaul. The spirit of the age beckons even scrapping certain existing sections, provisions, and rules on grounds of redundancy. One cannot view the vicissitudes of 2015 through circa 1940 spectacles, which, at present, can be analyzed only by experts who have crossed sixty summers. At the same time, the next generation, having not lived through the past, cannot view the vicissitudes of the present period by wearing 2015 spectacles to interpret a circa 1940 enactment. In this article, an effort is made only on certain important provisions due to the paucity of space and time.
The powers of the authorities have to be curtailed, which at present are totally misused by them. The power to prosecute, wherever not needed, has to be taken out of the hands of the authorities. Politicians should be totally curtailed from involving themselves in the differences or disputes between employees and employers. All enactments should have provisions for the employer to file periodical returns by self-assessment, requiring no visits by the concerned department to inspect records. If necessary, the returns and records maintained should be audited by a firm of Advocates/Labour Law Consultants with their attestation, which the department has to accept.
A) The Industrial Disputes Act, 1947:
The definition of 'workman' includes 'apprentice.' An apprentice, by any stretch of the imagination, cannot be a workman and hence should be taken out of this section. Employers should be empowered to terminate workmen from services on defined grounds if the latter has worked less than five years without complying with the provisions of the Act. S17B, related to the payment of full wages to workmen pending proceedings in higher courts, should be deleted. This section is a hurdle even to exercise the fundamental right of the employer to approach higher courts because of the draconian mandatory insistence on paying full wages. If the order/decree of the higher courts favors the employer, there is no way to collect back the wages paid to the workman. As a result, such employers, who have constraints to approach higher courts, will only endure the unfavorable decisions of lower courts. S22(1) should extend to the private sector as well. S22(2), dealing with notice, etc., to declare a lockout, should be deleted altogether. Alternatively, S22(2)(d) has to be deleted as it causes tremendous hurdles to employers. In S25A(1)(a), the present headcount envisaged for the non-applicability of this section should be raised from its present 50 workmen to 500 workmen, and the clause 'average per working day' should be substituted by 'average per working year.' Chapter VB should be totally deleted if the ministry and framers of the law have any real vision to make India an industrial hub for both local and foreign investors. S33 and S36 are not employer-friendly sections, not conforming to the zeitgeist (spirit of the age). S33(2)(b) and S33(3), which call for 'approval' and 'permission' respectively from the concerned authority to discharge or punish a workman, have to be deleted totally. These subsections are not contemporaneous with the new trends in work culture and act as a shield to protect workmen who are unfit to be continued in service. The concept of 'protected workman' is no longer valid considering the history of industrial unrest caused by the latter being under the umbrella of this section. Accordingly, Sections 33A, 33C, and Chapter VII have to be relooked into, requiring major amendments.
B) Contract Labour (Regulation & Abolition) Act, 1970:
At present, the Act defines only 'workman' - S2(i). Instead, the Act has to define an 'employee,' covering staff and officers, knowledge-based resources who are not part of the principal employer and serve under deputation. 'Workman' is only a sub-sect of the main sect 'Employee.' Since almost 70% of the employees in our country are contract labor, envisaging permission by way of a license, the abolition of contract labor is not practical. Employers' right to hire and the right to terminate have to be articulated without recourse to license formalities. The provisions related to these have to be amended to generate more employment without hurdles and harassment from the regulatory department.
C) The ESIC Act, 1948:
The definition of 'Employment Injury' under S 2(9) has to be broadened with an extended notion of time, keeping in mind that an employee can fall prey to a disease even after a few decades for having worked in a job that has the propensity to cause injury not immediately but after a long lapse of time. The Second and Third Schedules have to be amended to include injuries, disablements, and occupational diseases which have currently manifested and are therefore new and not found in the schedules, which are caused by new types of work demands, even capturing the latest diseases that pass through the regions. For example, work/job specifications in both old and new economy industries like continuous night shift work, call centers, and IT jobs, which affect vocal cords and the spinal column, affect the circadian clock of the human body. The definition of Employee-S 2(9) should specifically bring under its umbrella IT, ITES, BPO, Call Centres, and allied business verticals.
D) The EPF & Miscellaneous Provisions Act, 1952:
The definition of 'employer' under S(e) should be broader and articulate its applicability to educational, charitable institutions, hospitals, and all types of new economy modern establishments. Accordingly, the definition of 'employee' under S2(f) should be amended. Opting for EPF should be made the choice of the employee once their wages are above the maximum wages specified and as periodically amended to come under the purview of coverage. In Schedule I of the Act, other types of establishments, as notified under S4, should be articulated. The powers of the EPF Commissioner to withdraw the 'certificate' issued to the recovery officer should be enlarged, and this authority should be even empowered to make an act of withdrawal even after the recovery steps are initiated. In Sections 8D, 8B, and 8E, the power of the authorized officer to amend the certificate issued for the recovery of dues needs amendment to include other grounds as well. If a director or other officer of an establishment is wrongly inducted as an employer for recovery, the authorized officer should be empowered to consider such a person's application, and upon satisfaction, the authorized officer should have the power not to make the person a party to the recovery proceedings.
E) Payment of Gratuity Act, 1972:
Employees who have completed 4 years and 6 months of continuous service with an employer should have their tenure for eligibility to gratuity considered as the completion of 5 years, which is not articulated in S4, leading to grievances and disputes.
F) The Trade Union Act, 1926:
The Act should be made applicable only to establishments/industries with 1000 and above workmen. The minimum number of workmen envisaged under the Act to form a union should be raised from 7 to 100. Further affiliations to unions at the State or National level should be only when there are 5000 workmen in an industry and not otherwise.
G) The Payment of Bonus Act, 1965:
For employers to come under the purview of the Act, the present holiday period of 5 years should be made to 10 years for SSIs and 7.5 years for MSMEs. Further, even though an employer has paid a bonus in previous years, a provision has to be made to protect the interest of the employer to the effect that the employer need not be under obligation to pay a bonus for periods when there is no profit and as a sequel, there is no available surplus.
H) The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013:
The definition of 'aggrieved woman' under S2(a) should cover, on behalf of the woman subjected to harassment, her parents, husband, guardians, and family. As a sequel, the definition of family should cover the woman's lineal ascendants and descendants, the latter restricted to brothers and sisters. The definition of 'sexual harassment' at present covers only 4 acts or behaviors, and the 5th only says that 'any other... conduct of sexual nature.' This should be in the tone of an inclusive definition and cover broad areas of harassment. A provision prohibiting floors, walls, and other spaces at the workplace having glass should be made. For example, if the first story has a floor made of glass, people standing or passing via the floor are visible to the people on the ground floor. This has been witnessed in some modern industries.
I) Minimum Wages Act, 1948:
Production bonuses, incentives linked to performance, etc., should be excluded as exemptions from the purview of minimum wages by articulation. When wages paid by an employer exceed the stipulated minimum wages, the Act should become inapplicable to such an industry/establishment. As a sequel, restructuring of wages by employers should not be under the purview of this Act and also should not be considered as 'alteration of conditions of service.'
J) The Maternity Benefits Act, 1961:
Since some establishments/industries pay paternity benefits in the form of leave, etc., such best practices should be encouraged by including the practice as a cover in the Act. The medical bonus should be drastically increased from the present Rs1000 to Rs5000 for establishments that are large-scale.
K) The Industrial Employment (Standing Orders) Act, 1946:
For certification of S.Os, only workmen employed under the principal employer should be considered for headcount for certification purposes. Temporary workmen, badlis, casuals, and others should not be counted for this. The applicability of the Act should be made for establishments where there are more than 1000 workmen. The Karnataka Model SOs should take certain clauses found in Schedule I of the Model SOs of the Industrial Employment (S.O) Central Rules, 1946, wherever it is practically possible. Acts and omissions that are to be treated as misconduct need further elaboration, as the present acts and conducts defined are not elaborative to the current period. Subsistence allowance should not exceed 50% of the wage at any period of suspension of a workman.
L) The Karnataka Payment of Subsistence Allowance Act, 1988:
This Act deserves to be repealed with immediate effect, as from the date of its promulgation, the Act has only increased disputes and has not acted as a measure to resolve the differences or disputes. Otherwise, sections related to the payment of subsistence allowance have to be amended, restricting the payment to a maximum of 50% of the last drawn wages of the workman. It should also make provisions to safeguard the employer in cases of the employee not attending the domestic inquiry by totally suspending the subsistence allowance payment and also in instances where, due to the default of the workman, the domestic inquiry is unnecessarily prolonged due to his non-cooperation. If there are criminal proceedings existing or initiated against a workman, payment of subsistence allowance should be suspended in the interest of justice.
M) The Factories Act, 1948:
Many of the sections have become redundant by the flux of time and by changes in circumstances. All such sections have to be either deleted or suitably modified to apply to the present and future context. There should not be any restrictions on the number of hours of work to be performed per day, shift changes, overtime, and provisions related to permission on these matters have to be removed. There should not be any permission required to shift or relocate machinery. Prosecution clauses, which are currently a threat to the employer, have to be removed. Instead, penalties can be increased. The prevailing practice of 'Inspector Raj' should be totally curbed by way of drastic amendments in the Act and Rules. Empowerment to punish an employer should vest only with the Director of Factories and Boilers and should not be delegated to lower grades. At present, there is rampant misuse of powers vested, and employers are harassed. All periodical returns should be self-attested and filed with the department, and inspectors should be stopped from visiting factories for inspection of records.
Regards,
Dr. Gubbi
Counselor & Advocate
Dr. Gubbi & Associates
[Phone Number Removed For Privacy Reasons]
From India, Bangalore
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2The Factories Act and all statutes under the domain of Labour Laws need a drastic overhaul. The spirit of the age beckons even scrapping certain existing sections, provisions, and rules on grounds of redundancy. One cannot view the vicissitudes of 2015 through circa 1940 spectacles, which, at present, can be analyzed only by experts who have crossed sixty summers. At the same time, the next generation, having not lived through the past, cannot view the vicissitudes of the present period by wearing 2015 spectacles to interpret a circa 1940 enactment. In this article, an effort is made only on certain important provisions due to the paucity of space and time.
The powers of the authorities have to be curtailed, which at present are totally misused by them. The power to prosecute, wherever not needed, has to be taken out of the hands of the authorities. Politicians should be totally curtailed from involving themselves in the differences or disputes between employees and employers. All enactments should have provisions for the employer to file periodical returns by self-assessment, requiring no visits by the concerned department to inspect records. If necessary, the returns and records maintained should be audited by a firm of Advocates/Labour Law Consultants with their attestation, which the department has to accept.
A) The Industrial Disputes Act, 1947:
The definition of 'workman' includes 'apprentice.' An apprentice, by any stretch of the imagination, cannot be a workman and hence should be taken out of this section. Employers should be empowered to terminate workmen from services on defined grounds if the latter has worked less than five years without complying with the provisions of the Act. S17B, related to the payment of full wages to workmen pending proceedings in higher courts, should be deleted. This section is a hurdle even to exercise the fundamental right of the employer to approach higher courts because of the draconian mandatory insistence on paying full wages. If the order/decree of the higher courts favors the employer, there is no way to collect back the wages paid to the workman. As a result, such employers, who have constraints to approach higher courts, will only endure the unfavorable decisions of lower courts. S22(1) should extend to the private sector as well. S22(2), dealing with notice, etc., to declare a lockout, should be deleted altogether. Alternatively, S22(2)(d) has to be deleted as it causes tremendous hurdles to employers. In S25A(1)(a), the present headcount envisaged for the non-applicability of this section should be raised from its present 50 workmen to 500 workmen, and the clause 'average per working day' should be substituted by 'average per working year.' Chapter VB should be totally deleted if the ministry and framers of the law have any real vision to make India an industrial hub for both local and foreign investors. S33 and S36 are not employer-friendly sections, not conforming to the zeitgeist (spirit of the age). S33(2)(b) and S33(3), which call for 'approval' and 'permission' respectively from the concerned authority to discharge or punish a workman, have to be deleted totally. These subsections are not contemporaneous with the new trends in work culture and act as a shield to protect workmen who are unfit to be continued in service. The concept of 'protected workman' is no longer valid considering the history of industrial unrest caused by the latter being under the umbrella of this section. Accordingly, Sections 33A, 33C, and Chapter VII have to be relooked into, requiring major amendments.
B) Contract Labour (Regulation & Abolition) Act, 1970:
At present, the Act defines only 'workman' - S2(i). Instead, the Act has to define an 'employee,' covering staff and officers, knowledge-based resources who are not part of the principal employer and serve under deputation. 'Workman' is only a sub-sect of the main sect 'Employee.' Since almost 70% of the employees in our country are contract labor, envisaging permission by way of a license, the abolition of contract labor is not practical. Employers' right to hire and the right to terminate have to be articulated without recourse to license formalities. The provisions related to these have to be amended to generate more employment without hurdles and harassment from the regulatory department.
C) The ESIC Act, 1948:
The definition of 'Employment Injury' under S 2(9) has to be broadened with an extended notion of time, keeping in mind that an employee can fall prey to a disease even after a few decades for having worked in a job that has the propensity to cause injury not immediately but after a long lapse of time. The Second and Third Schedules have to be amended to include injuries, disablements, and occupational diseases which have currently manifested and are therefore new and not found in the schedules, which are caused by new types of work demands, even capturing the latest diseases that pass through the regions. For example, work/job specifications in both old and new economy industries like continuous night shift work, call centers, and IT jobs, which affect vocal cords and the spinal column, affect the circadian clock of the human body. The definition of Employee-S 2(9) should specifically bring under its umbrella IT, ITES, BPO, Call Centres, and allied business verticals.
D) The EPF & Miscellaneous Provisions Act, 1952:
The definition of 'employer' under S(e) should be broader and articulate its applicability to educational, charitable institutions, hospitals, and all types of new economy modern establishments. Accordingly, the definition of 'employee' under S2(f) should be amended. Opting for EPF should be made the choice of the employee once their wages are above the maximum wages specified and as periodically amended to come under the purview of coverage. In Schedule I of the Act, other types of establishments, as notified under S4, should be articulated. The powers of the EPF Commissioner to withdraw the 'certificate' issued to the recovery officer should be enlarged, and this authority should be even empowered to make an act of withdrawal even after the recovery steps are initiated. In Sections 8D, 8B, and 8E, the power of the authorized officer to amend the certificate issued for the recovery of dues needs amendment to include other grounds as well. If a director or other officer of an establishment is wrongly inducted as an employer for recovery, the authorized officer should be empowered to consider such a person's application, and upon satisfaction, the authorized officer should have the power not to make the person a party to the recovery proceedings.
E) Payment of Gratuity Act, 1972:
Employees who have completed 4 years and 6 months of continuous service with an employer should have their tenure for eligibility to gratuity considered as the completion of 5 years, which is not articulated in S4, leading to grievances and disputes.
F) The Trade Union Act, 1926:
The Act should be made applicable only to establishments/industries with 1000 and above workmen. The minimum number of workmen envisaged under the Act to form a union should be raised from 7 to 100. Further affiliations to unions at the State or National level should be only when there are 5000 workmen in an industry and not otherwise.
G) The Payment of Bonus Act, 1965:
For employers to come under the purview of the Act, the present holiday period of 5 years should be made to 10 years for SSIs and 7.5 years for MSMEs. Further, even though an employer has paid a bonus in previous years, a provision has to be made to protect the interest of the employer to the effect that the employer need not be under obligation to pay a bonus for periods when there is no profit and as a sequel, there is no available surplus.
H) The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013:
The definition of 'aggrieved woman' under S2(a) should cover, on behalf of the woman subjected to harassment, her parents, husband, guardians, and family. As a sequel, the definition of family should cover the woman's lineal ascendants and descendants, the latter restricted to brothers and sisters. The definition of 'sexual harassment' at present covers only 4 acts or behaviors, and the 5th only says that 'any other... conduct of sexual nature.' This should be in the tone of an inclusive definition and cover broad areas of harassment. A provision prohibiting floors, walls, and other spaces at the workplace having glass should be made. For example, if the first story has a floor made of glass, people standing or passing via the floor are visible to the people on the ground floor. This has been witnessed in some modern industries.
I) Minimum Wages Act, 1948:
Production bonuses, incentives linked to performance, etc., should be excluded as exemptions from the purview of minimum wages by articulation. When wages paid by an employer exceed the stipulated minimum wages, the Act should become inapplicable to such an industry/establishment. As a sequel, restructuring of wages by employers should not be under the purview of this Act and also should not be considered as 'alteration of conditions of service.'
J) The Maternity Benefits Act, 1961:
Since some establishments/industries pay paternity benefits in the form of leave, etc., such best practices should be encouraged by including the practice as a cover in the Act. The medical bonus should be drastically increased from the present Rs1000 to Rs5000 for establishments that are large-scale.
K) The Industrial Employment (Standing Orders) Act, 1946:
For certification of S.Os, only workmen employed under the principal employer should be considered for headcount for certification purposes. Temporary workmen, badlis, casuals, and others should not be counted for this. The applicability of the Act should be made for establishments where there are more than 1000 workmen. The Karnataka Model SOs should take certain clauses found in Schedule I of the Model SOs of the Industrial Employment (S.O) Central Rules, 1946, wherever it is practically possible. Acts and omissions that are to be treated as misconduct need further elaboration, as the present acts and conducts defined are not elaborative to the current period. Subsistence allowance should not exceed 50% of the wage at any period of suspension of a workman.
L) The Karnataka Payment of Subsistence Allowance Act, 1988:
This Act deserves to be repealed with immediate effect, as from the date of its promulgation, the Act has only increased disputes and has not acted as a measure to resolve the differences or disputes. Otherwise, sections related to the payment of subsistence allowance have to be amended, restricting the payment to a maximum of 50% of the last drawn wages of the workman. It should also make provisions to safeguard the employer in cases of the employee not attending the domestic inquiry by totally suspending the subsistence allowance payment and also in instances where, due to the default of the workman, the domestic inquiry is unnecessarily prolonged due to his non-cooperation. If there are criminal proceedings existing or initiated against a workman, payment of subsistence allowance should be suspended in the interest of justice.
M) The Factories Act, 1948:
Many of the sections have become redundant by the flux of time and by changes in circumstances. All such sections have to be either deleted or suitably modified to apply to the present and future context. There should not be any restrictions on the number of hours of work to be performed per day, shift changes, overtime, and provisions related to permission on these matters have to be removed. There should not be any permission required to shift or relocate machinery. Prosecution clauses, which are currently a threat to the employer, have to be removed. Instead, penalties can be increased. The prevailing practice of 'Inspector Raj' should be totally curbed by way of drastic amendments in the Act and Rules. Empowerment to punish an employer should vest only with the Director of Factories and Boilers and should not be delegated to lower grades. At present, there is rampant misuse of powers vested, and employers are harassed. All periodical returns should be self-attested and filed with the department, and inspectors should be stopped from visiting factories for inspection of records.
Regards,
Dr. Gubbi
Counselor & Advocate
Dr. Gubbi & Associates
[Phone Number Removed For Privacy Reasons]
From India, Bangalore
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Dear Dr. Gubbi,
You have copied the whole article from the following link and pasted it on this forum: https://www.indianbarassociation.org...d-labour-laws/
This forum is not for the promotion of one's blog. Members raise their queries, and other members respond to their queries to the best of their capacity. Occasionally, members do share articles or links, but these are not necessarily their blogs. If everybody starts promoting his/her blog, it would create chaos on this forum, and we will end up missing the wood for the trees!
At least you could have done the copy and paste work a little better by correcting the garbled text. But then it appears that your views are more garbled than the text!
About Your Article
Views given by you in the article are your personal views. While I would not like to give a point-by-point counter, let me quote one of the sentences given in paragraph 8(M) of your article. It reads, "There should not be any restrictions on the number of hours of work to be performed per day, shift changes, overtime, and provisions related to permission on these matters have to be removed."
If restrictions on the number of hours are removed, then employers will have the right to force employees to work any number of hours. In that case, will it not be deja vu of the pre-industrialization era of the 17th or 18th century?
Your article is only on amendments to the existing laws. But then what about compliance with the existing labor laws? Who measures it? On what parameters is it measured? What is the compliance percentage? Nothing is mentioned about it.
The article gives the impression that Indian employers effuse with magnanimity, and labor laws are their major impediments. Remove the villainous labor laws, and India would usher to become a superpower!
If you had spent some time browsing this forum, then you would have found lots of posts where employers have thrown labor laws to the wind. What appears on this forum is just a fraction, and many things happen beyond this forum. Why is there no mention of such employers? Take the case of Dr. Vijay Mallya. A national figure who did not pay salaries to his staff, yet his merriment continued without any trace of guilt. Why are intellectuals like you so bothered by laws that can be bent and twisted by the high and mighty?
Gentleman, what you have done is to flip one side of the coin called labor laws. The other side of the coin is employers. Both are equally good and both are equally bad. India's growth is let down by both. As a third party, we should keep ourselves out of the tussle of blackness between the pot and the kettle.
Nothing stops Indian businesspersons from spending more on R&D. Nothing stops them from coming up with innovative products or services. Talk to Mechanical Engineers and ask them how many times they have used techniques of Operations Research (OR) which they learned in their Engineering course. Very few engineers do that. What is holding up in optimizing the resources by using these techniques? Is it labor law hold up?
Talk to the purchase managers and ask them how many times they calculated the Break-Even Point (BEP). Which labor law is prohibiting them from doing this calculation?
How many businesspersons calculate the Internal Rate of Return (IRR) at the time of the purchase of capital equipment and later do the variance analysis on projected Vs. actual IRR? Which labor law is responsible for this languor?
Talk to the Training Managers and ask them for how many training programs they have calculated Return on Investment (ROI) on the training? Which labor law says not to calculate the ROI?
Examples of ham-handedness or half-heartedness in the execution are plenty. It is not possible to go on giving examples like this. The success of American companies like Google, Microsoft, FedEx, Walmart can never be attributed to their labor laws. They have created their industrial empires because of their faith in management science. They are working in 250+ countries because of the difference in their organization's culture. The trouble with Indian industries is the lack of faith in management science. The situation aggravates when intellectuals like you support them, widening this deficit of faith further.
My views could be assertive. I request you not to take these personally. These are professional differences.
Thanks,
Dinesh Divekar
From India, Bangalore
Acknowledge(16)
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You have copied the whole article from the following link and pasted it on this forum: https://www.indianbarassociation.org...d-labour-laws/
This forum is not for the promotion of one's blog. Members raise their queries, and other members respond to their queries to the best of their capacity. Occasionally, members do share articles or links, but these are not necessarily their blogs. If everybody starts promoting his/her blog, it would create chaos on this forum, and we will end up missing the wood for the trees!
At least you could have done the copy and paste work a little better by correcting the garbled text. But then it appears that your views are more garbled than the text!
About Your Article
Views given by you in the article are your personal views. While I would not like to give a point-by-point counter, let me quote one of the sentences given in paragraph 8(M) of your article. It reads, "There should not be any restrictions on the number of hours of work to be performed per day, shift changes, overtime, and provisions related to permission on these matters have to be removed."
If restrictions on the number of hours are removed, then employers will have the right to force employees to work any number of hours. In that case, will it not be deja vu of the pre-industrialization era of the 17th or 18th century?
Your article is only on amendments to the existing laws. But then what about compliance with the existing labor laws? Who measures it? On what parameters is it measured? What is the compliance percentage? Nothing is mentioned about it.
The article gives the impression that Indian employers effuse with magnanimity, and labor laws are their major impediments. Remove the villainous labor laws, and India would usher to become a superpower!
If you had spent some time browsing this forum, then you would have found lots of posts where employers have thrown labor laws to the wind. What appears on this forum is just a fraction, and many things happen beyond this forum. Why is there no mention of such employers? Take the case of Dr. Vijay Mallya. A national figure who did not pay salaries to his staff, yet his merriment continued without any trace of guilt. Why are intellectuals like you so bothered by laws that can be bent and twisted by the high and mighty?
Gentleman, what you have done is to flip one side of the coin called labor laws. The other side of the coin is employers. Both are equally good and both are equally bad. India's growth is let down by both. As a third party, we should keep ourselves out of the tussle of blackness between the pot and the kettle.
Nothing stops Indian businesspersons from spending more on R&D. Nothing stops them from coming up with innovative products or services. Talk to Mechanical Engineers and ask them how many times they have used techniques of Operations Research (OR) which they learned in their Engineering course. Very few engineers do that. What is holding up in optimizing the resources by using these techniques? Is it labor law hold up?
Talk to the purchase managers and ask them how many times they calculated the Break-Even Point (BEP). Which labor law is prohibiting them from doing this calculation?
How many businesspersons calculate the Internal Rate of Return (IRR) at the time of the purchase of capital equipment and later do the variance analysis on projected Vs. actual IRR? Which labor law is responsible for this languor?
Talk to the Training Managers and ask them for how many training programs they have calculated Return on Investment (ROI) on the training? Which labor law says not to calculate the ROI?
Examples of ham-handedness or half-heartedness in the execution are plenty. It is not possible to go on giving examples like this. The success of American companies like Google, Microsoft, FedEx, Walmart can never be attributed to their labor laws. They have created their industrial empires because of their faith in management science. They are working in 250+ countries because of the difference in their organization's culture. The trouble with Indian industries is the lack of faith in management science. The situation aggravates when intellectuals like you support them, widening this deficit of faith further.
My views could be assertive. I request you not to take these personally. These are professional differences.
Thanks,
Dinesh Divekar
From India, Bangalore
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I fully agree with your view, Mr. Dinesh. I wholeheartedly endorse every line of yours above. The industry consists of a partnership between management and labor, and they should not work at cross purposes. The problem is that the pendulum of supervision swings excessively. Inspector Raj is pronounced in our nation. However, if Inspector Raj is not permitted, many factories would be run like sweatshops with no care for the health and safety of poor workers. The unorganized sector is still treated poorly, while organized labor, especially in PSU and government sectors, is over-pampered. No wonder India has not come up with a Google or Microsoft. India needs capitalism with a human face and workers who refuse to get politically active. Making India an easy place for business will have to rest on the maturity and sensitivity of the management class and equally a responsible labor force that looks beyond mere increases in pay.
From India, Pune
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From India, Pune
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1. Sir, the initiator of this thread is a learned Counselor and an Advocate, and I appreciate his efforts to raise the issue regarding amendments in certain labor laws as mentioned in the said thread.
2. I may, however, add for the kind information of the initiator of this thread that Section 2(9) of the ESI Act, 1948 (for which a case has been made for amendment) defines the term "employee." This term is already very exhaustive and almost covers all employees except as specifically excluded in the Act. The employees working in "IT, ITES, BPO, Call Centres, and allied business verticals" are already covered under the said Act either as a "factory" under Section 1(3) or as a "shop" under Section 1(5) of the said Act, depending upon the facts of each establishment. Furthermore, in case of diseases having long sickness spells, ESIC provides for Enhanced Sickness Benefit (ESB) to the insured persons.
3. Further, under Section 7 of the Maternity Benefit Act, 1961, the present rate of "Maternity Bonus" is Rs. 3500/- and not Rs. 1000/- as mentioned by the initiator of this thread. This rate has been revised long back vide notification dated 19/12/2011.
4. I will request the initiator of this thread to kindly reconsider his proposals as mentioned in the thread so that the same may be in accordance with the laws as they stand at present, enabling us to update our knowledge accordingly. The proposals can be sent to the Ministry of Labour & Employment, Central Govt for consideration, if desired.
5. I may, however, also submit that the welfare of the workers or of the middle and small-scale employers is only an excuse for the government. In the year 2002, the 2nd National Labour Commission had submitted its report, and action on major recommendations of the Commission is still pending with the Govt. Nothing is expected from the Govt. which is already discussing major amendments in the labor laws, including curtailing the scope of social security and expanding the scope of the free economy. I have heard that a few years ago, there was a major accident in one of the factories in UP, and in the said factory accident, about 40 workers were killed. The names of the majority of such killed workers were neither on muster-rolls nor on the wages register of the said factory. The Govt. itself believes that the compliance of labor laws should continue to be on the same pattern and is therefore pressing hard to abolish and curtail visits of Inspectors to the units to check the compliance of various labor laws.
Regards
From India, Noida
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2. I may, however, add for the kind information of the initiator of this thread that Section 2(9) of the ESI Act, 1948 (for which a case has been made for amendment) defines the term "employee." This term is already very exhaustive and almost covers all employees except as specifically excluded in the Act. The employees working in "IT, ITES, BPO, Call Centres, and allied business verticals" are already covered under the said Act either as a "factory" under Section 1(3) or as a "shop" under Section 1(5) of the said Act, depending upon the facts of each establishment. Furthermore, in case of diseases having long sickness spells, ESIC provides for Enhanced Sickness Benefit (ESB) to the insured persons.
3. Further, under Section 7 of the Maternity Benefit Act, 1961, the present rate of "Maternity Bonus" is Rs. 3500/- and not Rs. 1000/- as mentioned by the initiator of this thread. This rate has been revised long back vide notification dated 19/12/2011.
4. I will request the initiator of this thread to kindly reconsider his proposals as mentioned in the thread so that the same may be in accordance with the laws as they stand at present, enabling us to update our knowledge accordingly. The proposals can be sent to the Ministry of Labour & Employment, Central Govt for consideration, if desired.
5. I may, however, also submit that the welfare of the workers or of the middle and small-scale employers is only an excuse for the government. In the year 2002, the 2nd National Labour Commission had submitted its report, and action on major recommendations of the Commission is still pending with the Govt. Nothing is expected from the Govt. which is already discussing major amendments in the labor laws, including curtailing the scope of social security and expanding the scope of the free economy. I have heard that a few years ago, there was a major accident in one of the factories in UP, and in the said factory accident, about 40 workers were killed. The names of the majority of such killed workers were neither on muster-rolls nor on the wages register of the said factory. The Govt. itself believes that the compliance of labor laws should continue to be on the same pattern and is therefore pressing hard to abolish and curtail visits of Inspectors to the units to check the compliance of various labor laws.
Regards
From India, Noida
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Critique on Copy-Pasting and Suggestions for Law Amendments
It is all very nice to copy and paste something, as our senior member has pointed out. But what is the reason for posting that here? Please state that.
Are you actually suggesting that these are the changes that are needed? Why tell us that? We already discuss these things on the forum from time to time. Or are you just trying to make a presence felt (in which case, thinking no one will notice a copy-paste is a bad idea).
If you want to propose changes in the law, there is a tripartite mechanism at the Center where this is done. There are provisions in the Ministry of Labour for public suggestions for changes, corrections, and reactions to the proposed changes.
You can go and meet the Labour Secretary (or Under Secretary at least). They are pretty open to accepting public help these days. Alternatively, the Employers Federation of India has an HR committee that functions like a think tank and interacts with the government to advocate for these changes. In addition, FICCI, CII, Chambers of Commerce, they all have committees dedicated to this work. By all means, offer your expertise to them. It will do much more good than pasting the article here.
Regards
From India, Mumbai
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It is all very nice to copy and paste something, as our senior member has pointed out. But what is the reason for posting that here? Please state that.
Are you actually suggesting that these are the changes that are needed? Why tell us that? We already discuss these things on the forum from time to time. Or are you just trying to make a presence felt (in which case, thinking no one will notice a copy-paste is a bad idea).
If you want to propose changes in the law, there is a tripartite mechanism at the Center where this is done. There are provisions in the Ministry of Labour for public suggestions for changes, corrections, and reactions to the proposed changes.
You can go and meet the Labour Secretary (or Under Secretary at least). They are pretty open to accepting public help these days. Alternatively, the Employers Federation of India has an HR committee that functions like a think tank and interacts with the government to advocate for these changes. In addition, FICCI, CII, Chambers of Commerce, they all have committees dedicated to this work. By all means, offer your expertise to them. It will do much more good than pasting the article here.
Regards
From India, Mumbai
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Change of Labour Laws: A Critical Perspective
Change of labour laws, inspector raj, and ease of doing business are terms being bandied about freely in the press nowadays. The present Government came into power on a sweeping mandate of bringing positive change and putting India on a track of a fast-developing economy. Frequent comparisons with China are being made. We are in no way comparable to China other than in population, where we can enter our name in the world book of records as the most populated country in the universe. The Chinese attitude and mental outlook are far different from ours, and what and how China developed cannot be replicated by India. India has the potential, as is always being repeated ad nauseam.
What stops us from development is clearly the lack of leadership, a leader with a PAN India vision who is not linked to lobbies of whatsoever nature. The diversity of India implies that one cannot push any particular agenda onto people; there will be resistance and unstated lack of cooperation. The main roadblock is the amazing maze of laws in the country. There is a law for everything, but still, India remains a lawless land. The rich and powerful always escape from the rigors of the law. India needs to cut down babudom and make them accountable to the nation.
Similar laws to protect worker welfare and jobs exist in other countries, and they have still progressed, but our attitude is the roadblock. Every babu thinks of power in his hand, every owner thinks of how much moolah he can earn and avoid tax, and every worker thinks of how to garner as many benefits as possible with the least amount of hard work. In this background, the millions of unorganized labor sweat their life out on construction sites with nary a safety feature and welfare mechanism. Skinny, half-clad children of labor roam around - no school, no safety from open pits dug during construction.
All this is known to the Government since most realty players are closely linked to political outfits. The sheer scale of overpopulation overwhelms the nation. But population control is a taboo word for the political class. For India to change, cosmetic changes in the provisions of labor law, making it owner-friendly, and easing regulatory controls without owners showing necessary good faith is not going to bring about change in India to superpower status.
Population control, simplified laws but enforced strictly without fear or favor can bring changes. For all those who criticize Emergency, trains ran on time, schools/colleges ran and were not on strike, and most importantly, babus had a fear of their overprotected job and worked. (I, of course, realize that the motive of Emergency was not to bring in good change but to preserve some person's seat of power.)
We have to understand that liberty and democracy can survive only where the people exercise their rights with maturity and duties with even greater promptness.
If this post is off track, don't mind, it is the heartfelt feeling of a poster who wants India to shine and be a genuine superpower - wealth, happiness, and national character.
Regards
From India, Pune
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Change of labour laws, inspector raj, and ease of doing business are terms being bandied about freely in the press nowadays. The present Government came into power on a sweeping mandate of bringing positive change and putting India on a track of a fast-developing economy. Frequent comparisons with China are being made. We are in no way comparable to China other than in population, where we can enter our name in the world book of records as the most populated country in the universe. The Chinese attitude and mental outlook are far different from ours, and what and how China developed cannot be replicated by India. India has the potential, as is always being repeated ad nauseam.
What stops us from development is clearly the lack of leadership, a leader with a PAN India vision who is not linked to lobbies of whatsoever nature. The diversity of India implies that one cannot push any particular agenda onto people; there will be resistance and unstated lack of cooperation. The main roadblock is the amazing maze of laws in the country. There is a law for everything, but still, India remains a lawless land. The rich and powerful always escape from the rigors of the law. India needs to cut down babudom and make them accountable to the nation.
Similar laws to protect worker welfare and jobs exist in other countries, and they have still progressed, but our attitude is the roadblock. Every babu thinks of power in his hand, every owner thinks of how much moolah he can earn and avoid tax, and every worker thinks of how to garner as many benefits as possible with the least amount of hard work. In this background, the millions of unorganized labor sweat their life out on construction sites with nary a safety feature and welfare mechanism. Skinny, half-clad children of labor roam around - no school, no safety from open pits dug during construction.
All this is known to the Government since most realty players are closely linked to political outfits. The sheer scale of overpopulation overwhelms the nation. But population control is a taboo word for the political class. For India to change, cosmetic changes in the provisions of labor law, making it owner-friendly, and easing regulatory controls without owners showing necessary good faith is not going to bring about change in India to superpower status.
Population control, simplified laws but enforced strictly without fear or favor can bring changes. For all those who criticize Emergency, trains ran on time, schools/colleges ran and were not on strike, and most importantly, babus had a fear of their overprotected job and worked. (I, of course, realize that the motive of Emergency was not to bring in good change but to preserve some person's seat of power.)
We have to understand that liberty and democracy can survive only where the people exercise their rights with maturity and duties with even greater promptness.
If this post is off track, don't mind, it is the heartfelt feeling of a poster who wants India to shine and be a genuine superpower - wealth, happiness, and national character.
Regards
From India, Pune
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Instead of writing such a long essay, Dr. Gubbi should have written a single sentence that "the entire labor laws enforced in India should be scrapped and the old feudal system should be reintroduced".
Madhu.T.K
From India, Kannur
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Madhu.T.K
From India, Kannur
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Dear All, It is good to at least see that somebody is not posting a question on how to face unethical practices in their workplace... :-)
Though I agree with the statement made by Mr. Dinesh that, "The article gives an impression that Indian employers effuse with magnanimity and labor laws are their major impediments. Remove the villainous labor laws and India would usher to become a superpower!"
After independence, we have continued with many laws made by the British during their "rule times." Some sections, like the "provision for different Allowances," are really outdated schemes after independence. These allowances were provided separately from the basic compensation by the British, mainly to differentiate the salary structure of high-positioned British employees from the low-positioned Indian employees in the organizations. Unfortunately, even the 6th/7th pay commission still points to these laws, and allowances like DA are reaching about 100% today.
A drive to ask "Why" is needed today for many of these old laws, and it is admirable that private associations like INBA are thinking along these lines.
Though it is very important that individual/institutional aspirations and influences should be kept aside, which is a difficult thing to be achieved by a "Non-government organization" with ambitions.
Before suggesting any updates to the labor laws (even on a public forum for discussion), I think a statistical analysis needs to be done on the current laws' adequacy and changed market needs, in order to maintain the justifiable balance between the laborer and proprietor benefits. The above post fails to provide such evidence or even a mere mention of such a statistical study behind the amendment requests; hence, most of them can be seen as "Change for the sake of change"...
Best Regards, Amod Bobade.
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Though I agree with the statement made by Mr. Dinesh that, "The article gives an impression that Indian employers effuse with magnanimity and labor laws are their major impediments. Remove the villainous labor laws and India would usher to become a superpower!"
After independence, we have continued with many laws made by the British during their "rule times." Some sections, like the "provision for different Allowances," are really outdated schemes after independence. These allowances were provided separately from the basic compensation by the British, mainly to differentiate the salary structure of high-positioned British employees from the low-positioned Indian employees in the organizations. Unfortunately, even the 6th/7th pay commission still points to these laws, and allowances like DA are reaching about 100% today.
A drive to ask "Why" is needed today for many of these old laws, and it is admirable that private associations like INBA are thinking along these lines.
Though it is very important that individual/institutional aspirations and influences should be kept aside, which is a difficult thing to be achieved by a "Non-government organization" with ambitions.
Before suggesting any updates to the labor laws (even on a public forum for discussion), I think a statistical analysis needs to be done on the current laws' adequacy and changed market needs, in order to maintain the justifiable balance between the laborer and proprietor benefits. The above post fails to provide such evidence or even a mere mention of such a statistical study behind the amendment requests; hence, most of them can be seen as "Change for the sake of change"...
Best Regards, Amod Bobade.
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After going through the reply of Dinesh-ji, there is little one can add. He has covered all the aspects. To make a small addition to his post, I would like to state that all the organizations mentioned by him, namely Google, Walmart, etc., are top-ranking employers in several surveys conducted by different agencies.
From India, New Delhi
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From India, New Delhi
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Cross-section of opinions is being shared. It is worth noting, and it is also an appropriate time for experts to express their opinions, as amendments are expected shortly. Please continue the debate for the information of all stakeholders.
From India, Nellore
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From India, Nellore
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Politicians and Employee-Employer Disputes
Politicians should be totally curtailed from involving in the differences or disputes between employees and employers. Half the industry is run by political leaders, so how do you intend to curtail their involvement directly and indirectly?
Self-Assessment and Auditing
All enactments should have provisions for employers to file periodical returns by self-assessment, requiring no visits by the concerned department to inspect records. If necessary, the returns and records maintained should be audited by a firm of Advocates/Labour Law Consultants with their attestation, which the department has to accept. This is impractical, to say the least, or the Government of India should wind up/lay off half their inspector strength. We do not have the moral high ground to be squeaky clean.
Apprentices and Workmen
An apprentice, by any stretch of imagination, cannot be a workman and hence should be taken out of this section. What statutory protection are we going to give apprentices?
Termination Grounds
Employers should be empowered to terminate workmen from the services on defined grounds if the latter has worked less than five years without complying with the provisions of the Act. What are the defined grounds? Who will verify the grounds of termination? After all, self-certification is being asked everywhere.
Section 17B of the ID Act
Section 17B of the ID Act should be deleted. Then workers will find that employers with greater resources will always apply to higher courts for relief. Probably, the employer can be asked to deposit 50% of the disputed amount in court before appeal.
Employer Rights and Work Culture
Employers' right to hire and the right to terminate has to be articulated without recourse to license formalities. Are you talking about a free hire and fire culture?
Work Hours and Regulations
There should not be any restrictions on the number of hours of work to be performed per day, shift changes, overtime, and provisions related to permission on these matters have to be removed. Workers will become slaves.
Inspector Raj and Industrial Reforms
The prevailing practice of 'Inspector Raj' should be totally curbed by way of drastic amendments in the Act and Rules. No rule or Act can bring in honesty. Removal of checks by inspectors is like throwing the baby out with the bathwater. What the nation requires is diluting some of the more difficult provisions and stricter supervision by higher-level officers.
Trade Unions and Political Influence
Trade union culture needs to be curbed, and allowing outsiders and political leaders to take control of trade unions should be stopped. Multiple unions need to be discouraged. There is no quick solution for quick industrialization. Strong political will is the first condition for development. Concern for the environment is another important consideration. Genuine concern for unorganized labor is to be shown in action. Pampering of organized labor needs a total review.
Taxation and Political Will
Simplification of the taxation structure, excise, and other indirect taxes is necessary. Ultimately, both states and the center should sit together and be on the same page (which is unlikely considering the political environment).
Regards
From India, Pune
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Politicians should be totally curtailed from involving in the differences or disputes between employees and employers. Half the industry is run by political leaders, so how do you intend to curtail their involvement directly and indirectly?
Self-Assessment and Auditing
All enactments should have provisions for employers to file periodical returns by self-assessment, requiring no visits by the concerned department to inspect records. If necessary, the returns and records maintained should be audited by a firm of Advocates/Labour Law Consultants with their attestation, which the department has to accept. This is impractical, to say the least, or the Government of India should wind up/lay off half their inspector strength. We do not have the moral high ground to be squeaky clean.
Apprentices and Workmen
An apprentice, by any stretch of imagination, cannot be a workman and hence should be taken out of this section. What statutory protection are we going to give apprentices?
Termination Grounds
Employers should be empowered to terminate workmen from the services on defined grounds if the latter has worked less than five years without complying with the provisions of the Act. What are the defined grounds? Who will verify the grounds of termination? After all, self-certification is being asked everywhere.
Section 17B of the ID Act
Section 17B of the ID Act should be deleted. Then workers will find that employers with greater resources will always apply to higher courts for relief. Probably, the employer can be asked to deposit 50% of the disputed amount in court before appeal.
Employer Rights and Work Culture
Employers' right to hire and the right to terminate has to be articulated without recourse to license formalities. Are you talking about a free hire and fire culture?
Work Hours and Regulations
There should not be any restrictions on the number of hours of work to be performed per day, shift changes, overtime, and provisions related to permission on these matters have to be removed. Workers will become slaves.
Inspector Raj and Industrial Reforms
The prevailing practice of 'Inspector Raj' should be totally curbed by way of drastic amendments in the Act and Rules. No rule or Act can bring in honesty. Removal of checks by inspectors is like throwing the baby out with the bathwater. What the nation requires is diluting some of the more difficult provisions and stricter supervision by higher-level officers.
Trade Unions and Political Influence
Trade union culture needs to be curbed, and allowing outsiders and political leaders to take control of trade unions should be stopped. Multiple unions need to be discouraged. There is no quick solution for quick industrialization. Strong political will is the first condition for development. Concern for the environment is another important consideration. Genuine concern for unorganized labor is to be shown in action. Pampering of organized labor needs a total review.
Taxation and Political Will
Simplification of the taxation structure, excise, and other indirect taxes is necessary. Ultimately, both states and the center should sit together and be on the same page (which is unlikely considering the political environment).
Regards
From India, Pune
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In social life, what is happening around us, whether we have even the remotest involvement in it or not, is capable of sensitizing us to speak our minds one way or the other. As such, we have the innate freedom of expression of our thoughts.
The Role of Law in Social Life
When our social life is marked by the supremacy of the rule of law, even wishful thinking suggestive of drastic amendments to the important provisions of certain existing laws needs to be reminiscent of the social mischiefs and inequities originally addressed by the passing of such laws as a measure of social justice, rather than a knee-jerk reaction dictated by temporary inconveniences.
The Emergence of the Middle Class
Prior to the advent of the Industrial Revolution in the late 18th century, there were only two classes: the rich and the poor in all societies. However, its spread across the continents slowly started a new class called the middle class or the salaried class. Of course, the top-paid CEO of an MNC to the blue-collar workman of a local foundry would be well within this class only, for they are programmed to work for others only. If they are thrown out of employment for any reason, the survival of their families is at stake. So the primary concern of this working class is nothing more than the security of employment.
Critique of Proposed Labor Law Amendments
The primary reason for the overwhelming negative response to the article under discussion is that it suggests, in essence, amendments to various labor laws to facilitate hire and fire based on market-driven economic factors without having any human touch. I am not sure whether the write-up was done before the publishing of the proposed Code on Industrial Relations Bill, 2015, which envisages many liberal relaxations and new restrictions applicable to both labor and managements.
No government can ensure full employment on its own to all its citizens; but it is the duty of every government to reduce the rate of unemployment through its policy of employment generation. All modern governments are oriented towards welfare state principles. As such, it is their duty to ensure social security to all its citizens. When the percentage of social security amount spent out of GDP is as high as 40.05% in Sweden, India is only at 0.44%. So the removal of Chapter V-B of the ID Act, 1947 will certainly lead to large-scale unemployment of the organized labor under the guise of "right sizing," which is nothing but converting the non-bargainable into bargainable for the sake of cost reduction and creating more disguised and frictional unemployment.
Productivity and Employment Concerns
In reality, productivity is not about doing the same with less but about doing more with the same. To be frank, in the name of company apprenticeship scheme, thousands of skilled laborers are engaged in original works for a spell of three years and then discharged. In such a situation, if apprentices are removed from the definition of workman, they would be deemed to be so during their entire working life.
Despite the tightening of the noose by notifications under section 10 of the CLRA Act, 1970, and liberal interpretations regarding equality of wages and other pecuniary benefits to contract labor by the higher judiciary from time to time, still, the ratio of contract labor is on the rise. Section 17-B was introduced by the amending Act of 1982 with a view to curb the tendency of employers to implement the awards of reinstatement on the ground of appeal. In such cases, initial relief of injunction is granted to the employer from contravention of S. 29. If section 17-B is scrapped, how will the dismissed employee face the appeal by the employer? He will become yet another vociferous Trade Unionist. Therefore, such an amendment will be violative of the right to live, I think.
Working Hours and Labor Laws
The prevailing weekly working hours are: 40 in the USA, 38.6 in France, 40 in Europe, 44 in China and South Korea against 40 of the ILO Convention no. 47, whereas in India it is 48. Then what is the justification for the suggestion for the removal of restrictions on working hours and overtime work?
Observations on Industrial Disputes
As a person associated with the resolution of industrial disputes over a period of 30 years, my humble observation is this: Apparently, though restrictive as far as the employers are concerned, our pre and post-independence labor laws are the best pieces of social justice, and insufficient compliance and ineffective enforcement are the prime reasons for industrial strife. Hence, the replacement of periodic inspections by government inspectorate is resorted to by the self-audit or social audit suggested, which would make statutory compliance worse from the prevailing worse condition.
Most of the closures are not caused by labor unrest but by mismanagement only. Corporate Social Responsibility is not just planting a few trees or owning cricket teams. It is the creation of social assets both material and human. So, the undercurrent of amendments proposed to every labor law should aim at protecting the interests of all stakeholders of the industry, including labor.
Conclusion
Let me conclude with the following observations of Justice Gajendragadkar: "The theory of 'hire and fire' as well as the theory of 'supply and demand' which were allowed free scope under the doctrine of laissez-faire no longer hold the field... considerations of the financial position of the employer and the state of the national economy have their say, and the requirements of the workmen living in a civilized and progressive society also come to be recognized."
From India, Salem
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The Role of Law in Social Life
When our social life is marked by the supremacy of the rule of law, even wishful thinking suggestive of drastic amendments to the important provisions of certain existing laws needs to be reminiscent of the social mischiefs and inequities originally addressed by the passing of such laws as a measure of social justice, rather than a knee-jerk reaction dictated by temporary inconveniences.
The Emergence of the Middle Class
Prior to the advent of the Industrial Revolution in the late 18th century, there were only two classes: the rich and the poor in all societies. However, its spread across the continents slowly started a new class called the middle class or the salaried class. Of course, the top-paid CEO of an MNC to the blue-collar workman of a local foundry would be well within this class only, for they are programmed to work for others only. If they are thrown out of employment for any reason, the survival of their families is at stake. So the primary concern of this working class is nothing more than the security of employment.
Critique of Proposed Labor Law Amendments
The primary reason for the overwhelming negative response to the article under discussion is that it suggests, in essence, amendments to various labor laws to facilitate hire and fire based on market-driven economic factors without having any human touch. I am not sure whether the write-up was done before the publishing of the proposed Code on Industrial Relations Bill, 2015, which envisages many liberal relaxations and new restrictions applicable to both labor and managements.
No government can ensure full employment on its own to all its citizens; but it is the duty of every government to reduce the rate of unemployment through its policy of employment generation. All modern governments are oriented towards welfare state principles. As such, it is their duty to ensure social security to all its citizens. When the percentage of social security amount spent out of GDP is as high as 40.05% in Sweden, India is only at 0.44%. So the removal of Chapter V-B of the ID Act, 1947 will certainly lead to large-scale unemployment of the organized labor under the guise of "right sizing," which is nothing but converting the non-bargainable into bargainable for the sake of cost reduction and creating more disguised and frictional unemployment.
Productivity and Employment Concerns
In reality, productivity is not about doing the same with less but about doing more with the same. To be frank, in the name of company apprenticeship scheme, thousands of skilled laborers are engaged in original works for a spell of three years and then discharged. In such a situation, if apprentices are removed from the definition of workman, they would be deemed to be so during their entire working life.
Despite the tightening of the noose by notifications under section 10 of the CLRA Act, 1970, and liberal interpretations regarding equality of wages and other pecuniary benefits to contract labor by the higher judiciary from time to time, still, the ratio of contract labor is on the rise. Section 17-B was introduced by the amending Act of 1982 with a view to curb the tendency of employers to implement the awards of reinstatement on the ground of appeal. In such cases, initial relief of injunction is granted to the employer from contravention of S. 29. If section 17-B is scrapped, how will the dismissed employee face the appeal by the employer? He will become yet another vociferous Trade Unionist. Therefore, such an amendment will be violative of the right to live, I think.
Working Hours and Labor Laws
The prevailing weekly working hours are: 40 in the USA, 38.6 in France, 40 in Europe, 44 in China and South Korea against 40 of the ILO Convention no. 47, whereas in India it is 48. Then what is the justification for the suggestion for the removal of restrictions on working hours and overtime work?
Observations on Industrial Disputes
As a person associated with the resolution of industrial disputes over a period of 30 years, my humble observation is this: Apparently, though restrictive as far as the employers are concerned, our pre and post-independence labor laws are the best pieces of social justice, and insufficient compliance and ineffective enforcement are the prime reasons for industrial strife. Hence, the replacement of periodic inspections by government inspectorate is resorted to by the self-audit or social audit suggested, which would make statutory compliance worse from the prevailing worse condition.
Most of the closures are not caused by labor unrest but by mismanagement only. Corporate Social Responsibility is not just planting a few trees or owning cricket teams. It is the creation of social assets both material and human. So, the undercurrent of amendments proposed to every labor law should aim at protecting the interests of all stakeholders of the industry, including labor.
Conclusion
Let me conclude with the following observations of Justice Gajendragadkar: "The theory of 'hire and fire' as well as the theory of 'supply and demand' which were allowed free scope under the doctrine of laissez-faire no longer hold the field... considerations of the financial position of the employer and the state of the national economy have their say, and the requirements of the workmen living in a civilized and progressive society also come to be recognized."
From India, Salem
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With due respect to your suggestion/view on the posting of a learned man, I can only add that the views of learned people get debated, especially if some of the views are a throwback to earlier centuries. Even the learned Einstein's theory of relativity was questioned and proved wrong to the extent that the speed of light can be broken.
So, if in science, where precision and accuracy are of ultimate importance, then in social sciences and law, there is no absolute right or wrong. No one will want to give unlimited and unquestioned working hours as suggested. Owners cannot be given unlimited rights.
While I respect the views of learned members, I will give my views (for what it is worth) to add to the discussion value.
From India, Pune
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So, if in science, where precision and accuracy are of ultimate importance, then in social sciences and law, there is no absolute right or wrong. No one will want to give unlimited and unquestioned working hours as suggested. Owners cannot be given unlimited rights.
While I respect the views of learned members, I will give my views (for what it is worth) to add to the discussion value.
From India, Pune
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RECENT AMENDMENTS IN THE LABOUR LAWS - year 2010.doc