Labour welfare legislation refers to laws designed to improve the working conditions, rights, and well-being of employees in India. It covers areas such as social security, fair wages, safety, and healthcare, aiming to protect workers’ rights and improve their quality of life. Labour welfare legislation also seeks to prevent exploitation and promote social justice in the workplace.
The Indian Constitution and labour laws
India is a union of states. The Constitution of India is the basic legal framework for all laws, including labour laws, and it gives certain powers to both the Centre and the states and union territories. Article 246 of the Constitution authorizes the Central and state governments to make and implement laws as long as state laws don’t contradict the Central laws. Additionally, the Central government makes and protects various labour laws with the help of the Supreme Court.
Labour laws protect employees, familiarize them with their rights and responsibilities, and help prevent and resolve conflicts between employers and their workers. They aim to create and maintain industrial peace, enabling harmonious relationships between workers, employers, and the government.
Key labor welfare Acts
These welfare Acts are key parts of the history and development of labour laws in India.
Workmen’s Compensation Act, 1923
The Workmen’s Compensation Act of 1923 provides financial compensation to workers who suffer injuries, disabilities, or death due to workplace accidents or occupational diseases. It makes sure that employers are liable for compensation, reducing the financial burden on workers, their dependents, and their families. This law is crucial for safeguarding the rights of employees in hazardous industries.
Trade Unions Act, 1926
The Trade Unions Act of 1926 defines the legal framework for the registration and operation of trade unions in India. It aims to protect workers' rights to organise and collectively bargain for better wages, working conditions, and benefits. This law empowers employees and fosters industrial democracy across India.
Payment of Wages Act, 1936
The Payment of Wages Act ensures timely and complete payment of wages to employees without unauthorised deductions. It applies to workers earning below a specified wage threshold, addressing issues like wage delays and exploitation by employers. It promotes fair treatment and financial security for workers.
Industrial Employment (Standing Orders) Act, 1946
The Industrial Employment (Standing Orders) Act of 1946 requires employers to define and publish clear terms and conditions of employment, known as standing orders. It standardises workplace rules regarding conduct, disciplinary actions, and grievance mechanisms, promoting transparency and reducing industrial conflicts.
Industrial Disputes Act, 1947
The Industrial Disputes Act of 1947 provides mechanisms for resolving industrial disputes through conciliation, arbitration, or adjudication. It aims to maintain harmonious labour relations and outlines procedures for layoffs, retrenchment, lockouts, and strikes, preventing unlawful practices and maintaining a fair balance between employer and employee interests.
Minimum Wages Act, 1948
The Minimum Wages Act of 1948 mandates the payment of minimum wages to workers to make sure they receive a basic standard of living. It protects workers from exploitation by setting industry and skill-specific wage floors. The Act is vital for promoting social justice and economic equity.
Factories Act, 1948
As one of the critical pieces of labour welfare legislation in India, the Factories Act of 1948 regulates the health, safety, and welfare of the workers employed in industrial establishments and factories. It regulates working hours, hazardous processes, and workplace conditions to prevent accidents and occupational diseases. It also contains provisions to ensure that factories are safe and sanitary, workers are not subjected to harmful working hours and work overloads, and they have access to basic welfare amenities, such as canteens and first-aid facilities.
Employees’ State Insurance (ESI) Act, 1948
The Employees’ State Insurance Act provides health insurance, maternity benefits, and financial support during sickness, injury, or unemployment for employees earning below a certain wage. It establishes a contributory social security scheme to protect workers and their dependents from unforeseen hardships.
Employees’ Provident Funds (EPF) and Miscellaneous Provisions Act, 1952
The Employees’ Provident Funds (EPF) and Miscellaneous Provisions Act of 1952 mandates the creation of provident fund accounts for employees, where both employers and employees contribute a portion of wages. The fund acts as a financial safety net, providing retirement benefits, medical expenses, and support during emergencies. It fosters long-term financial security.
Maternity Benefit Act, 1961
The Maternity Benefit Act provides paid maternity leave, nursing breaks, and other benefits to pregnant women and new mothers in the workforce. It prohibits dismissal during pregnancy and helps women balance work and motherhood without financial strain.
Apprentices Act, 1961
The Apprentices Act of 1961 regulates training for apprentices to promote skill development and employability. It requires employers in specified industries to hire apprentices and provide them with structured training. The Act helps bridge the skills gap between older and younger workers and fosters workplace readiness in newer generations of employees.
Payment of Bonus Act, 1965
The Payment of Bonus Act of 1965 mandates the payment of annual bonuses to employees earning below a specified salary threshold. Bonuses are linked to the profitability of the business, incentivizing workers while sharing company success with a larger share of India’s economy. This promotes worker satisfaction and morale.
Contract Labour (Regulation and Abolition) Act, 1970
The Contract Labour (Regulation and Abolition) Act of 1970 regulates the employment of contract labour and prohibits its use in certain situations to prevent exploitation. It mandates that employers register their contracts with workers, and outlines basic welfare provisions like timely wages, drinking water, and canteens, in order to safeguard the rights of contract workers.
Payment of Gratuity Act, 1972
The Payment of Gratuity Act provides for gratuity payments for employees upon retirement, resignation, or death after completing at least five years of service. It acts as a financial reward for long-term employment and provides post-employment financial security to workers and their families.
Specialized Acts for different sectors
Workers in various sectors have received greater protection through the enactment of labor laws aiming to improve conditions of work in particular industries.
Plantations Labour Act, 1951
The Plantations Labour Act of 1951 regulates the working conditions of labourers employed in plantations like tea, coffee, and rubber. It mandates provisions for housing, medical facilities, crèches, and educational arrangements for workers and their dependents. The law also regulates paid leave and hours of work (for example, under the Act, women and children can’t work night shifts). It aims to safeguard the welfare of plantation workers, who often live and work in isolated areas under challenging conditions.
Mines Act, 1952
The Mines Act of 1952 was enacted to ensure workers’ health, safety, and welfare in mining operations. The Act mandates provisions of a safe working environment, appointment of safety officers, use of protective gear, adequate ventilation, and regular health checks. It also limits working hours and prohibits the employment of children in mines.
Employment Exchange (Compulsory Notification of Vacancies) Act, 1959
The Employment Exchange (Compulsory Notification of Vacancies) Act, 1959 requires employers to notify local employment exchanges of vacancies in their establishments.
Positions related to agriculture or those with a temporary duration of less than three months are exempt from this requirement. The Act aims to streamline the employment process by linking job seekers with potential employers through a government-mandated system.
Motor Transport Workers Act, 1961
The Motor Transport Workers Act of 1961 regulates the working conditions of employees in the motor transport industry, including bus and truck drivers, conductors, and maintenance staff. It mandates provisions for working hours, rest periods, overtime pay, health and safety measures, and welfare facilities like canteens and restrooms. The Act ensures fair treatment and better work-life balance for transport workers, who often face long hours and strenuous conditions.
Beedi and Cigar Workers (Conditions of Employment) Act, 1966
The Beedi and Cigar Workers (Conditions of Employment) Act of 1966 protects workers involved in the beedi and cigar manufacturing industry by setting guidelines for working hours, health and safety, and welfare measures such as maternity benefits and crèches. It also prohibits child labour in the industry. The law addresses the exploitation of workers in this largely unorganised sector, safeguarding their basic rights and welfare.
Bonded Labour System (Abolition) Act, 1976
The Bonded Labour System (Abolition) Act of 1976 abolishes the practice of bonded labour, where individuals are forced to work under coercion or for minimal wages to repay debts. It declares all bonded labour agreements null and void, releases labourers from their obligations, and provides for their rehabilitation. The law is pivotal for eradicating this form of modern slavery—promoting social welfare and human rights through a legal framework that advances human dignity and eradicates exploitation.
Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996
The Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act of 1996 regulates the working conditions of construction workers, ensuring their safety and welfare. It mandates provisions for health, safety, and welfare measures such as crèches, canteens, and accident insurance. It also requires the establishment of Welfare Boards to collect a cess from employers to fund worker benefits. The law addresses the vulnerabilities of construction workers, who often face unsafe working conditions and irregular employment.
Cine-workers Welfare Fund Act
The Cine-workers Welfare Fund Act establishes a welfare fund to support cine-workers employed in the film industry, including actors, technicians, and other crew members. It provides financial assistance for health, education, and housing, as well as support during unemployment or emergencies. The law ensures social security for cine-workers, who often lack stable employment or benefits.
Shops and Establishments Act
The Shops and Establishments Act (often referred to as the Establishments Act) governs the working conditions of employees in shops, commercial establishments, and certain other types of businesses. The Act varies from state to state in India, as each state has its own version of the law. IIt governs aspects like working hours, rest intervals, overtime pay, leave policies, and safety measures, aiming to create a fair work environment for employees in non-industrial settings, balancing their welfare with business needs.
Labour Welfare Fund Act
The Labour Welfare Fund Act establishes a fund to support various welfare schemes for workers, including medical care, housing, educational scholarships, and recreational facilities. Contributions are made by employers, employees, and sometimes the government. This law improves the quality of life for workers, especially those in unorganised sectors, by providing financial support and access to welfare programs.
Challenges in labour welfare and the role of the government
Among some of the top challenges India still faces in labour welfare today are unorganised sectors and the pervasiveness of child labour.
Enforcement challenges in unorganised sectors
An unorganised sector, such as construction, is a significant part of the Indian workforce that constantly faces compliance challenges regarding labour welfare. Many workers in these sectors are employed on a temporary, informal basis, making it challenging to evaluate and regulate their work conditions.
Additionally, when employees are not formally registered, they cannot access the Employees’ Provident Fund (EPF), Employees’ State Insurance (ESI) and other government welfare schemes.
Workers in unorganised sectors are vulnerable to exploitation, working overtime and being underpaid. The transient nature of many of their job sites makes compliance enforcement much more difficult, while the absence of trade unions reduces the workers’ options to bargain for better working conditions.
Child labour and the ongoing struggle for full eradication
Despite the Child Labour (Prohibition and Regulation) Act of 1986 and additional government initiatives, child labour has not been entirely eradicated in India, persisting in sectors such as manufacturing, agriculture, and domestic work.
Poverty, lack of education, and other socioeconomic factors continue to contribute to the exploitation of children, particularly in rural areas.
International Labour Organization standards and India’s compliance
One of the UN’s first and oldest specialised agencies, the International Labour Organization (ILO), sets international labour standards and helps improve social and economic justice across its member states.
India’s adherence to ILO conventions and labour standards
India has been a member of the ILO for over a century (since 1919). The country has adopted core ILO conventions on equal remuneration, child labour, and the abolition of forced labour.
While it has yet to formally ratify ILO conventions on freedom of association and collective bargaining, India has enforced these principles through domestic laws such as the Industrial Relations Code of 2020.
The Constitution of India incorporates many principles aligned with ILO standards, primarily in its Directive Principles of State Policy, which improve living standards, safeguard worker welfare, and ensure equitable working conditions. Still, informal employment and compliance with occupational safety norms present a challenge.
Role of the ILO in shaping India’s labour welfare policies
The ILO has significantly influenced India’s labour legislation, including the Minimum Wages Act, the Factories Act, and the Equal Remuneration Act.
The organisation provides policy support and technical guidelines to ensure Indian labour laws align with international standards, such as eliminating child labour and improving social protection through social insurance schemes. The Government of India has collaborated with the ILO since its formation to enforce labour rights and promote decent work for all.
FAQ about labour welfare legislation
Which industries are covered under labour welfare legislation in India?
Labour welfare legislation covers a wide range of industries in the country, including construction, manufacturing, plantations, mines, motor transport, and more. Specific Acts are tailored to address the unique needs of workers in certain industries.
What is invisible labour?
Invisible labour refers to unpaid and unrecognised work, such as childcare, household work, and caring for elderly family members. Women mostly perform invisible labour. None of the existing labour laws regulate this area.
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