Labour law or employment law is the body of laws, regulations,
administrative rulings, and precedents which address the legal
rights of, and restrictions on, labourers and their organizations.
t deals with many aspects of relationship between trade unions,
employers and their employees.
The final goal of Labour laws is to reduce the differences between
the Employer and Employee which leads in Industrial Growth and
Growth of a Nation.
Under the Constitution of India, Labour is a subject in the
Concurrent List where both the Central and State Governments
are competent to enact legislation.
As per the Constitution of India, matters in labour law contained
in Concurrent List are:
Entry No. 22: Trade Unions, industrialists and labour disputes.
Entry No. 23: Social Security and insurance, employment and
Entry No. 24: Welfare of labour
Subjects restricted to Union List are:
Entry No. 55: Regulation of labour and safety in mines and oil
Entry No. 61: Industrial disputes concerning Union employees.
Entry No. 65: Union agencies and institutions for Vocational
Laws related to Industrial Relations:
The Trade Unions Act, 1926
The Industrial Employment (Standing Orders) Act, 1946
The Industrial Disputes Act, 1947.
Laws related to Equality and Empowerment of Women:
The Maternity Benefit Act, 1961
The Equal Remuneration Act, 1976.
Laws related to Wages:
Workmen’s Compensation Act, 1923
The Payment of Wages Act, 1948
The Working Journalist (Fixation of Rates of Wages) Act, 1958
The Payment of Bonus Act, 1965.
Laws related to Working Conditions:
The Factories Act, 1945
The Contract Labour (Regulation & Abolition) Act, 1970
Shops and Establishment Act
Indian Boilers Act, 1923
The Dangerous Machines (Regulations) Act, 1983.
Laws related to Social Security:
The Employees’ State Insurance Act, 1948
The Employees’ Provident Fund & Miscellaneous Provisions
The Payment of Gratuity Act, 1972
The Unorganized Workers’ Social Security Act, 2008
Employers’ Liability Act, 1938
The Children (Pledging of Labour) Act, 1938
The Child Labour (Prohibition and Regulation) Act, 1986
The Bonded Labour System (Abolition) Act, 1976
The Employment of Manual Scavengers and Construction of Dry
Latrines Prohibition Act, 1993.
Amendment made in Payment of Wages Act, 1936 enhancing
ceiling of workers from Rs.1,600/- to Rs.6,500/- per month and
subsequently to Rs.10,000/- per month
Amendment made Payment of Bonus Act, 1965, wherein
the calculation ceiling and eligibility limit under the Act has been
enhanced from Rs.2,500/- to Rs.3,500/- and from Rs.3,500/- to
Rs.10,000/- per month respectively.
He Apprentices Act, 1961 has been amended to provide
reservation for other backward classes. The Maternity Benefit Act,
1961 has been amended to enhance the medical bonus from
Rs.250/-to Rs.1000/- and also empowering the Central
Government to further increase it to maximum of Rs.20,000/through Gazette Notification.
The Workmen’s Compensation Act has been amended to make it
gender neutral and it is now called “the Employees’ Compensation
Act, 1923. Besides this, the Compensation in case of death,
disablement and funeral expense paid under the Act have also been
enhanced. The Plantation Labour Act, 1951 has been amended to
provide safety and occupational health care to plantation workers.
Employees’ State Insurance Act, 1948 has been amended to
improve the quality of delivery of benefits under the scheme and
also to enable ESI infrastructure to be used to provide health care to
workers of the unorganized sector.
Industrial Disputes Act, 1947 has been amended to amplify the
term “appropriate Government” defined under section 2(a) of the
Act. The wage ceiling for coverage under the Act has been
enhanced from Rs.1600/- to Rs.10,000/- per month to cover
workmen working in supervising capacity. The amended
provisions also provide direct access for the workman to the
Labour Court or Tribunal.
WHAT IS INDUSTRIAL RELATIONS?
IR is a relationship between management and
employees or among employees and their
organizations, that characteristics and grow out of
IR may be defined as the complex of inter-relations
among workers, managers and government.
CHARACTERISTICS OF IR:
An outcome of relationship in industry.
It create rules and regulations to maintain piece and
Important parts of IR are employees and their
organization, employer and their association and
It has a role of management, union and government.
OBJECTIVE OF IR:
To promote and develop labor management relation.
To regulate the production by minimizing industrial
To provide opportunity to workers to involve in
decision making process with management.
To encourage and develop trade unions in order to
improve the workers' strength.
ROLE OF TRADE UNIONS IN IR:
Achieving higher wages
To offer responsive co-operation in improving level of
production, discipline etc.
To promote individual and collective welfare
To improve working and living conditions
To enlarge the opportunities of promotion and training.
ROLE OF EMPLOYER’S ORGANISATION:
Promote and protect of the interest of employers engaged
in Industry, Trade and Commerce.
Bridge between Union Government
Train and develop staff members of concern members of
Code of Discipline
1. Conciliation Officer
2. Board of Conciliation
3. Court of Inquiry
a) Voluntary arbitration
b) Compulsory Arbitration
1. Labor Court
2. Industrial Tribunal
3. National Tribunal
The Industrial Relations (Amendment) Act, 2012 sets
stricter conditions for the establishment and variation of
Employment Regulation Orders (EROs) and Registered
Employment Agreements (REAs).
Both EROs and REAs set out legally binding minimum
pay and conditions for workers in different sectors of the
economy and encompass all workers in these sectors. An
ERO is set by a Joint Labour Council (JLC) made up of
representatives of workers and employers, while an REA
is an agreement by workers and employers which is
registered at the Labour Court. Both ERO’s and REA’s
are vetted by the Labour Court and ultimately the
Minister, before being legally enforceable.
What are the main changes in the new
legislation on EROs?
Basically, it sets out the principles and policies to be set
by the JLC when constructing an ERO; it gives guidance
as to what can be laid down with regard to pay and other
conditions in the ERO and sets out a mechanism for the
Labour Court to sort out disagreements at the JLC.
It also sets out a mechanism whereby an employer may
seek a temporary derogation or exemption from the
obligation to abide by the terms of an ERO.
The Labour Court will be allowed conduct a five year
review of all ERO’s/JLCs and may amend, merge or
abolish them according to criteria laid down. Employees
or trade unions can now go to a Rights Commissioner
with a complaint within six months with an appeal to the
Labour Court within six weeks.
Previous contraventions were processed by Labour
Inspectors. Any compensation awarded will be given
priority in the distribution of assets in the case of
What does a JLC have to take into account now
before proposing an ERO?
The JLC for a sector must now take cognizance of the
Legitimate financial and commercial interests of the
Efficient, economical and sustainable work practices
Agreeing and maintaining fair and sustainable
minimum rates of remuneration
Maintaining harmonious industrial relations
The levels of employment and unemployment in the
The general level of wages in comparable sectors
The current National Minimum Wage
Any National Wage Agreement in force
What powers does the JLC have now for setting
rates and conditions?
The JLC can:
Fix minimum hourly rates of remuneration but not more
than 2 hourly rates based on length of service in the
sector or enterprise concerned
Set statutory minimum conditions of employment
Provide regulations for under 18’s but the National
Minimum Wage must apply
The JLC cannot address:
Time off in lieu of public holidays
Compensation under the Organization of Working Act
for working on a Sunday
Payments in lieu of notice
Payments referable to redundancy
The industrial dispute means any dispute or difference
between:(i) Employers and employers
(ii) Employers and Workmen or
(iii) Workmen and workmen, which is connected with
Industrial disputes may be said to be disagreement or
controversy between management and labor with respect to
wages, working conditions, other employment matters or
Interest disputes: arising out of deadlocks in negotiation for
Grievance disputes: may pertain to discipline, wages,
working time, promotion, rights of supervisors etc. also some
times called interpretation disputes.
Unfair labor practices: those arising out of right to organize,
acts of violence, failure to implement an award, discriminatory
treatment, illegal strikes and lockouts.
Recognition disputes: over the rights of a TU to represent
class or category of workers.
According to SEC 22 (1) No person employed with a
public utility service shall go on strike in breach of
contract – Without giving the employer notice of
strike, within six weeks before the strike. Before the
expiry of date of strike specified in such notice.
According to SEC 23; No employee of any industrial
establishment shall go on strike during the period
when proceedings in any disputes case is going on or
when final judgment is awaited .
There are two ways in which the basic parties to an
industrial dispute- the employer and the employees- can
settle their disputes.
It is commonly viewed as less expensive and faster than
resolving a dispute in court.
An arbitrator may be a single person or a panel.
Sometimes, however, the parties may agree to submit the dispute
to an arbitrator but at the same time, reserve their right to accept
or reject the award when it comes.
1. In case of individual dispute of workman related to discharge,
dismissal, retrenchment or termination by any means, now the
workman has the right to approach labour court directly without
waiting for conciliation proceedings and Govt. reference.
But he has to wait for three months for this direct action from the
date of filling his application before conciliation officer if the Govt.
is not able to complete the reference process within three months.
Earlier there was no such direct option available to workman to
approach labour court.
(Except in some states like Karnataka where State govt. has
provided for direct approach to Labour court within 6 months of
2. Such workman in case of individual dispute has to file claim
within time limit period of three years. Earlier there was no
such limitation period prescribed under the ID Act.
3. Wage ceiling of supervisor has been enhanced from Rs.1600/- per
month to Rs. 10,000/- per month, which means now any person
working in any industry doing any manual, unskilled, skilled,
technical, operational, clerical or supervisory work drawing
wages up to Rs. 10000/- will be a workman. Earlier this limit was
up to Rs.1600/-By this amendment the coverage of workman has
been increased and more people are covered now under the Act.
4. Definition of appropriate Govt. has been amplified. Now for the
industry, corporation, PSEs owned or controlled by the Central
Govt., the appropriate Govt. would be Central Govt.
5. In case of industry under the control of State Govt., appropriate
Govt. would be State Govt.
6. Earlier to amendment only judicial officers were eligible to
become the Judges (Presiding Officers) of labour court/ tribunal.
Now with this recent amendment the Dy. Labour
Commissioners/ Joint Labour Commissioners with degree of
Law & having 7 years of experience can also become labour
court/ tribunal judges.
7. Every industry employing 20 or more workmen is now under legal
obligation to constitute and have a grievance redressal machinery
in place in the organization to resolve the workers dispute at the
first level. Earlier it was not legally essential. The related
provisions which were brought in the ID Act in 1984 were never
8. Now a provision has been made to execute the labour court/
tribunal decision. Earlier there was no such provision in the Act
and even after decision of the labour court/ tribunal there was no
machinery to enforce its execution on the employer. Now the
labour court/ tribunal shall transmit its award to concerned civil
court which shall execute the award as if it is a decree passed by