Layoffs Under the Factory Act: When and How Can They Be Implemented?

Hi to all,

Can anybody provide me with details regarding lay off under the Factory Act? In which cases can we implement lay off for employees and for how many days?

It is due to some problems with the network that the post could not be replied to. Do not think that you have put up a question which nobody could answer. First of all, lay off is not a subject of the Factories Act, but provisions relating to lay off are laid down in the Industrial Disputes Act. There are plenty of postings on lay off and retrenchments available on this site itself.

An employer can go for lay off when there exists a situation of material shortage or power shortage. An employer's step to lay off will be acceptable when there arise such other reasons beyond his control. He can declare lay off for the entire establishment or for a division of the establishment. During lay off days, the workers who have been in continuous service for at least one year are to be paid lay off compensation at 50% of the normal wages. However, no compensation shall be paid if such lay off is extended for a period beyond 45 days.

For establishments employing 100 or more employees, prior permission from the government should be taken before laying off employees.

Regards,
Madhu.T.K

Dear Mr. Mayur,

Your expectations are very high. After posting the query, you expect the opinion within a span of 4-5 hours. You seem to think that the voluntary members are sitting to observe only your posting. We condemn your comments. Moreover, it is made clear that all members are giving their valuable time and advice free of cost.

Even though having regards,

R. N. Khola
Skylark Associates, Gurgaon

Dear Sir Mr. R.N. Khola,

It was my very 1st day on this site, so I was not sure how quickly I would receive a reply. I was thinking that I would get a reply within a few hours, but that was not the case. I am truly sorry if my post caused any offense. I understand that your time is valuable, and you are not able to respond to everyone immediately. Now that I am more familiar with this site and how it works, I apologize once again for any inconvenience I may have caused.

Thank you.

Dear Ld. Mayur,

Mr. Madhu T.K. has already provided you with a reply to your query. Moreover, for more details, please refer to the provisions of Layoff under the Industrial Disputes Act, 1947. Chapter V-A and V-B relate to Layoff & retrenchment. We are all helping each other through this valuable information. Hope this will suffice your query.

With regards,

R.N. Khola
Sr. Associate

Could anybody provide me with more information regarding lay-offs? For instance, when should we inform employees about lay-offs, what benefits do they receive during a lay-off, what are the rules surrounding lay-offs, and which department is responsible for the notification?

In the sugar industry, trainees and company apprentices are eligible for layoff compensation. Please clarify.

Eligibility for Layoff Benefits

If they have been working for the last one year, then they are also entitled to layoff benefits. However, apprentices engaged following the provisions of the Apprentice Act are not considered workmen and thus are not eligible for layoff wages. At the same time, since the contract of apprentice training is suspended due to a layoff, they should be compensated as decided by the Apprentice Adviser.

Layoff Restrictions for Small Establishments

An establishment employing fewer than 50 workers cannot declare a layoff. If your establishment falls under this category, the workers should be paid full wages during the layoff days!

Regards,
Madhu.T.K