HR & Labour Relations Adviser
22nd December 2017 From India, Mumbai
22nd December 2017 From India, Hyderabad
(4) It shall apply, in the first instance, to all factories (including factories belonging to
the Government) other than seasonal factories.
Provided that nothing contained in this sub-section shall apply to a factory or
establishment belonging to or under the control of the Government whose employees are
otherwise in receipt of benefits substantially similar or superior to the benefits provided under this
So ipso facto being a Government factory or establishment does not exclude it, but the test of providing employees benefits substantially similar or superior to the Act holds the key.
Furthermore, Section 90 of the Act mandates that exemption of a factory or establishment or class of factories or establishments belonging to Government or any local authority is subject to the condition that employees of such factory or establishments are otherwise in receipt of benefits substantially similar or superior to the benefits provided under this Act. It is very difficult to fulfill this criteria particularly looking particularly to the medical benefit criteria. Secondly the same criteria applies to other organisations too, if we see Section 87, reproduced below.
87. Exemption of a factory or establishment or class of factories or establishments. —
The appropriate Government may by notification in the Official Gazette and subject to such conditions as may be specified in the notification, exempt any factory or establishment or class of factories or establishments in any specified area from the operation of this Act for a period not exceeding one year and may from time to time by like notification renew any such exemption for periods not exceeding one year at a time.
Provided that such exemptions may be granted only if the employees’ in such factories or
establishments are otherwise in receipt of benefits substantially similar or superior to the benefits
provided under this Act :
23rd December 2017 From India, Mumbai
23rd December 2017 From India, Mumbai
2. Even otherwise also under provisions of above Act, the said Act has no universal application. Initially it covers "factories" under section 1(3) and that too in notified areas and under section 1(5) it covers certain establishments which the appropriate State Govts. have declared coverable by notifications. A majority of State govts. have extended the provisions of above Act to "shops" etc. only.
3. In some of the government units which qualify as "factory" or "shop" or any other specified establishments, the appropriate govts. have granted exemptions on the basis of "benefits substantially similar or superior". However, in such government establishments like Oil Companies, Govt. Transport Workshops, KV substations of electricity boards etc. etc. the employees under category of casual, temporary, work-charge, as well as engaged through any contractor or immediate employer are not exempted and are covered/coverable under provisions of above Act. Therefore, I understand that it will not be fair to conclude that there is any blanket exemption under above Act to any government or PSUs. Important question is whether such unit is situated in implemented area and also whether it falls in category either of factory or as declared by the appropriate government under section 1(5) as mentioned above.
4. I may also submit that the provisions of social security benefits (like ESI benefits) have not been extended to all category of employees in India including in unorganised sector. More than 90% of work-force (including in unorganised sector) is still deprived of any protection under social security laws.
23rd December 2017 From India, Noida