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LABOUR CODE
ON SOCIAL SECURITY
Contents & Consequences
Second National Labour Commission Report
2
Page 152
3
CONSTITUTION
5
Representation in supreme bodies
Sl. No. Name of the Organisation Supreme Body No. of employers’ and
employees’
representatives.
1 ESI Act, 1948 ESI Corporation 10 + 10
2 EPF Act, 1952 Central Board 10 + 10
3 UWSS Act, 2008 National Board 7 + 7
4 Gratuity Act, 1972
5 Cine Workers Act, 1981 (Rule 3) Central Advisory Committee 7 + 7
6 Mica Mines Labour Welfare
Fund Act, 1946
Central Advisory Committee 6 + 6
7 Limestone and Dolomite Mines
Labour Welfare Fund Act, 1972
Central Advisory Committee 6 + 6
26 May 2023
Representation in supreme bodies
Sl. No. Name of the Organisation Supreme Body No. of employers’ and
employees’
representatives.
8 Iron Ore Mines, Manganese Ore
Mines, Chrome Ore Mines
Labour Welfare Fund Act, 1976
Central Advisory Committee 6 + 6
9 Beedi Workers Welfare Fund Act,
1976
Central Advisory Committee 7 + 7
Total Members representing all
these categories of employees
59 + 59
No. of representatives proposed for
the National Council under the
Labour Code (Sec. 3.3)
3 + 3
26 May 2023
Representation in supreme bodies
Sl. No. Name of the Organisation Supreme Body No. of employers’ and
employees’
representatives.
7 Iron Ore Mines, Manganese Ore
Mines, Chrome Ore Mines
Labour Welfare Fund Act, 1976
Central Advisory Committee 6 + 6
8 Beedi Workers Welfare Fund Act,
1976
Central Advisory Committee 7 + 7
Total Members representing all
these categories of employees
59 + 59
No. of representatives proposed for
the National Council under the
Labour Code (Sec. 3.3)
3 + 3
26 May 2023
Table of Welfare Funds
26 May 2023
26 May 2023
NATIONAL COUNCIL
• Under representation of employers and employees
representatives in the National Council.
• At present, the draft Code says that only three employees’
representatives are contemplated for National Council, and, there
is likely to be three employers representatives too.
• This is a clear case of under-representation.
EXECUTIVE COMMITTEE
• Executive Committee of the National Council
• It will have 2 + 2. Among them, one will be from the opposition side.
• And, he must be an expert on all these fifteen enactments to explain the case of the
employees.
• In fact, the draft Code says that the Executive Committee shall consist of, among others, “two persons representing
the employers elected by the National Council from amongst the persons representing employers”.
•
• But, Sec. 3.3 which specifies the constitution of the National Council does not have any provision to have any
member who is the representative of employers.
•
• This is an apparent omission and has to be set right . Ministry has promised it.
What is the motive?
26 May 2023
• There must, at least, be 15 employers’ representatives and 15
employees’ representatives in the National Council. Otherwise,
the National Council and Executive Committees will only be make
believe dummy arrangements.
• Democracy means more noise and less problems.
• As an all-India body, the National Council which is required to
deal with the problems of the workforce running into crores and
crores of Indian citizens deserve better and proper representation
in the National Council, more so, when so many enactments are
combined together.
• The ESI Corporation caters to the needs of about 8.28 crore
beneficiaries as on 31.03.2016 and protects the interests of
7.83 lakhs employers. The supreme body of the organisation,
the ESI Corporation, consists of about 60 persons (31 appointed
by the Central Government + three deputed by two houses of the
Parliament+ one each for every State).
• Of the 31 appointed by the Central Government, 10 are
employers’ representatives and 10 are employees’
representatives, as per Sec. 4 of the ESI Act, 1948.
•Likewise, the EPFO does also have 10
representatives each for employers and
employees, vide Sec. 5 A of the EPF and MP
Act, 1952.
•But, the proposed legislation reduces the
representation of these important stake-
holders in the supreme body to a token
presence, for the reasons not made known.
• Experience of these two organisations is that even when the representation
for employers and employees has been ten each, the political parties which
happened to occupy power at the Centre for a maximum period of five years
at a time, did not allow these organisations to function free from political
intrigues.
• Such an attitude played havoc with the system. These parties in power
filled up many of these 20 slots meant for employers and employees with
their own ‘yes-men’ giving only a few slots to the opposition parties or other
deserving persons, and that too, very grudgingly.
• In fact, the political parties which happened to be in power
wanted to manipulate and appropriate these organisations
for their private ends on many an occasion.
• As that was the general tendency of the political parties in
power, the presence of the competent employers and
employees representatives belonging to the other side was
reduced just to tokenism, when there were ten
representatives each for both categories.
• But, now, the representation is proposed to be drastically reduced to three
representatives each for employers and employees.
• This will result in total disappearance of even that token presence of the opposition
parties in the supreme body.
• The present proposal in the draft Code to have only three representatives each for
employers and the employees is surely an attempt at stifling the voices of
employers and employees, and that too, at the level of the national body.
• This may be projected and defended by the Ministry as
a political decision or policy decision. But, the fact is
that this is simply an arbitrary decision, without taking
into account the national interest.
• Common man is entitled to know what difficulties
were felt by the Central Government when there
were ten representatives each for employers and
employees, both in the ESIC and in the EPFO.
Significantly, the Ministry has not put in public domain
the relevant “Statement of Objects and Reasons” which
would have thrown light on the issue.
• Administering the Social Security Organisation of
the nation is an apolitical work and it must be left
free from political calculations and other extraneous
considerations.
• The present decision to reduce the number of
representatives to three each is patently arbitrary
and anti-democratic, without a ray of doubt.
• The proposed National Council deserves larger
representation from a wider spectrum of the
employers and employees throughout the nation
permitted in the supreme body.
• It is, therefore, suggested that the draft Labour Code
may be modified to facilitate inclusion of, at least, 15
representatives for employers and 15 for employees.
• Because, the proposed Code amalgamates so many
government and government oriented-organisations,
including the two major organisations, the ESIC and
the EPFO, where ten representatives on either side
were in the respective supreme governing bodies.
• The parties in power at the Centre should not give
the impression that they are afraid of facing the
representatives of the people by reducing their
representation in the proposed National Council.
• It is, therefore, proposed that the National Council
may be made to have 15 employers’ representatives
and 15 employees’ representatives.
SECOND NATIONAL LABOUR
COMMISSION
• Terms of Reference:
• 1. Review the existing labour laws in the organised sector in the changing economic
context and
• 2. suggest comprehensive legislation to ensure a minimum level of protection to
workers in the unorganised sector.
• AITUC, CITU, HMS were not consulted about the terms of reference.
• Nor were they involved in the Commission's proceedings. Only the BMS and
the INTUC were represented in the Commission.
•Will such a political party consider the
case of the other Trade Unions and
provide them a slot in the National
Council, in the three seats?
CONTRIBUTION
26 May 2023
CONTRIBUTION
• At present:
• ESIC = Employee 1.75% + Employer 4.75%
• EPFO = Employee 12% + Employer 12% +
Administrative Charges = 0.65%
• Employers’ total share = 17.4%
• Proposed
(Labour Code Sec. 20.1):
• State Social Security Fund – Centre to notify
(not exceeding)
Employers’ Share = 17.5%
• (Sec. 20.2) :
• State Gratuity Fund Employers’ Share = 2%
• Administrative Charges = (will be specified by
National Council u/S 165(2) (xxvi)
• Employers’ total share = 19.5% +
Administrative Charges
CONTRIBUTION
• At present:
• Employees’ total share = 13.75%
• Proposed
(Labour Code Sec. 20.3):
• Employees’ total share = 12.5%
• Self Employed = 20%
BENEFITS
TO THE
WORKERS
UNDER THE LABOUR CODE
26 May 2023
BENEFIT
•Maternity Benefit = Sec. 53-60.
•Disablement Benefit = Sec. 66-77.
•Dependent Benefit = Sec. 66-77
•Sickness Benefit = Sec. 78-82.
•Medical Benefit = Sec. 83-87.
BENEFITS
TO THE
INSURED PERSONS
UNDER THE PRESENT
ESI ACT
26 May 2023
Maternity Benefit
26 May 2023
MATERNITY BENEFIT
• Subscription compulsory – 54.5 –
• Should have actually worked for a period of not less than 80 days in the twelve
months preceding the date of expected confinement. (55.2)
• Period – 26 weeks (less than 2 surviving children) – 12 weeks in other cases.
• For, Adopting mother and Commissioning mother – 12 weeks.
• Rate of Benefit: (57).
• At the rate of Benefit Wage.
• Benefit Wage = Amount of wages deemed to be payable for a month’s service (Sec.
2.12).
BENEFIT WAGE
• Employee in service for a continuous period of not less than 12 months –Preceding
12 months wages ÷ 12
• In service for a period of less than 1 month = ? (2.12. (b).
• In service for more than 1 month but less than 12 months = 30 x Total wages
earned in respect of the last continuous period of service ÷ No. of days comprising
such period. (?)
• When not possible to calculate the monthly wages for want of necessary information
= Such rate as stipulated for various classes of employment.
Maternity Benefit
under the ESI Act, 1948
• Wages Rs. 5000 p.m.
• Standard Benefit Rate Rs. 163.93
• Maternity Benefit = SBR
• Cash Benefit for 84 days initially.
• Can be extended for another 30 days in case of sickness due to
pregnancy or confinement.
• One month MB = 164x30 = 4920
26 May 2023
Maternity Benefit under
Labour Code
• Subscription compulsory
• 54.5
• Subscription to the Maternity Benefit Scheme shall be compulsory for every
worker covered under sub-section (2), irrespective of his or her entitlement,
gender, ability or intention to avail the benefits of Maternity Benefit Scheme.
26 May 2023
26 May 2023
Dependants Benefit
DEPENDENTS BENEFIT
•Employment Injury that is fatal = 50% of the
Benefit Wage (Sec. 63.1)
•ESIC, at present provides 90% of the
Standard Benefit Rate.
SEC. 63.(1) (A) OF THE LABOUR CODE
RULE 58 (2) OF THE ESI (CENTRAL) RULES,1950
• Rule 2 (7-A) of the ESI (Central Rules) 1950 , adds that standard benefit rate
means average daily wages obtained by dividing the total wages paid during the
contribution period by the number of days for which these wages were paid.
• This works out approximately to 90% of th wages of the deceased employee or, in
certain cases, more than that amount.
• Even in the year 1952, the Dependant’s Benefit was about 70 % of the wages.
• The Sickness benefit itself was about 55% of the wages, then.
• So, reducing the quantum of Dependant’s benefit to 50% of the wages does not
show that the intention of the Code-makers is to improve the standard of living of
the workforce.
• This is patently unfair, unjust and unlawful.
• It is worth-comparing, in the context, that even the Sickness Benefit is 70% of the
Standard Benefit Rate under the ESI Scheme, at present.
Dependants Benefit
under the ESI Act, 1948
Wages Rs. 5000 p.m.
If the employment injury is a fatal one,
Monthly payment to his family members Rs. 4440
is apportioned among wife and children.
26 May 2023
COMPENSATION FOR FATAL ACCIDENTS
UNDER THE WC ACT, 1923 (NOW EC ACT)
• Sec. 63. 1 (a) (b) of the Labour Code adds, “such amount as may be prescribed,
whichever is more”.
• In this case, when the quantum of dependant’s benefit assured by the Code has,
unnecessarily been, reduced drastically, there is no reason for the people to believe
that this uncertain sub-section would be used to provide matching benefits as given
now under the ESI Scheme
PERMANENT
DISABLEMENT BENEFIT
46
PERMANENT DISABLEMENT
BENEFIT
• Sec. 63.1 (b) of the Labour Code:
RULE 57 (3) OF THE ESI (CENTRAL)
RULES, 1950
Permanent Disablement Benefit
under the ESI Act, 1948
Wages Rs. 5000 p.m.
If disabled permanently
Monthly payment as per the percentage
of loss of earning capacity.
If it is 50%, then the monthly payment is
50% of Rs. 4440.
26 May 2023
63.1 (B) (I) & 63.1 (B) (II) OF THE LABOUR CODE
• Quantum of Permanent Total Disablement Benefit has been
reduced in the Labour Code, when compared with what is
available now under the ESI Act, 1948.
• When the ESI Act provides almost 90 % of the wages as the
benefit for Permanent Total Disablement Benefit and Temporary
Total Disablement as per Sec.57 (4) of the ESI Act, 1948, the
benefit proposed to be provided under Sec. 63.1 (b) & (d) of the
Code is 60 % and 50% of the benefit wage, respectively, which is
far less than what is provided under the ESI Act at present
•Such a reduction in benefit shows
that the proposed Labour Code is
not for improving the lot of
working population.
SEC. 4 (C) OF THE W.C. ACT, 1923
TEMPORARY
DISABLEMENT BENEFIT
53
Temporary Disablement Benefit
under the ESIAct, 1948
•Wages Rs. 5000 p.m.
•Any number of days x Rs.148 per day
•If disbabled for 30 days
148x30=4440.
26 May 2023
COVERAGE OF ACCIDENTS
26 May 2023
51-B OF THE ESI ACT.
(ABSENT IN THE LABOUR CODE)
• 51-B. Accidents happening while acting in breach of regulations, etc. — An
accident shall be deemed to arise out of and in the course of an employee’s
employment not withstanding that he is at the time of the accident acting in
contravention of the provisions of any law applicable to him, or of any orders given
by or on behalf of his employer or that he is acting without instructions from his
employer, if —
• (a) the accident would have been deemed so to have arisen had the act not been
done in contravention as aforesaid or without instructions from his employer, as the
case may be ; and
• (b) the act is done for the purpose of and in connection with the employer’s trade or
business.
26 May 2023
51-C OF THE ESI ACT.
(ABSENT IN THE LABOUR CODE)
• 51-C. Accidents happening while travelling in employer’s transport. — (1) An accident happening
while an employee is, with the express or implied permission of his employer, travelling as a passenger
by any vehicle to or from his place of work shall, notwithstanding that he is under no obligation to his
employer to travel by that vehicle, be deemed to arise out of and in the course of his employment, if —
• (a)the accident would have been deemed so to have arisen had he been under such obligation ; and
• (b) at the time of the accident, the vehicle —
• (i) is being operated by or on behalf of his employer or some other person by whom it is provided in
pursuance of arrangements made with his employer ; and
• (ii) is not being operated in the ordinary course of public transport service.
• (2) In this section ― vehicle ‖ includes a vessel and an aircraft
26 May 2023
51-D OF THE ESI ACT.
(ABSENT IN THE LABOUR CODE)
• 51-D. Accidents happening while meeting emergency. — An accident happening
to an employee in or about any premises at which he is for the time being employed
for the purpose of his employer’s trade or business shall be deemed to arise out of
and in the course of his employment, if it happens while he is taking steps, on an
actual or supposed emergency at those premises, to rescue, succour or protect
persons who are, or are thought to be or possibly to be, injured or imperiled, or to
avert or minimize serious damage to property.
26 May 2023
51-E OF THE ESI ACT.
(ABSENT IN THE LABOUR CODE)
• 51-E. Accidents happening while commuting to the place of work and vice
versa. — An accident occuring to an employee while commuting from his residence
to the place of employment for duty or from the place of employment to his
residence after performing duty, shall be deemed to have arisen out of and in the
course of employment if nexus between the circumstances, time and place in which
the accident occured and the employment is established.
26 May 2023
SICKNESS BENEFIT
60
SICKNESS BENEFIT IN LABOUR CODE
• Rate of SB,
• No. of days of SB,
• Conditions to become eligible for SB,
• Qualification to claim SB,
• All, left to be decided by Subordinate Legislation called
• Sickness Benefit Scheme.
• The Sickness Benefit is 70% of the Standard Benefit Rate under the ESI Scheme,
at present.
 Wages Rs. 5000 p.m.
 Standard Benefit Rate
 Divide the total wages paid during the contribution
period by the number of days for which these wages
were paid
 30000/ 183=163.93
 Sickness Benefit = Rs. 163.93x70%
 One month sickness Benefit payable is = Rs.
115x30=3450
26 May 2023
SEC. 78.1
• Recognised medical practitioner
• any
• Registered medical practitioner
• Authorised medical practitioner
SEC. 55 (2) OF THE ESI (CENTRAL) RULES, 1950
REG. 103 – A OF THE ESI (GENERAL) REGULATIONS, 1950
• 103-A (1): Medical benefit after contribution ceases to be payable.
• A person on becoming an insured person for the first time shall be entitled to
medical benefit for a period of 3 months provided that where such a person
continues for 3 months or more to be an employee of a factory or establishment to
which the Act applies, he shall be entitled to medical benefit till the beginning of the
corresponding benefit period.
• Labour code -
• Reg. 103-A (2) The person in respect of whom contributions have
been paid in a contribution period for not less than seventy-eight
days in the said contribution period shall be entitled to medical
benefit till the end of the corresponding benefit period :
• Labour Code: Silent
• Reg. 103-A (2) -Provided that in case of a person who becomes an employee within
the meaning of the Act, for the first time, and for whom a shorter contribution period
of less than 156 days is available, he shall be entitled to medical benefit till the end
of the corresponding benefit period if the contributions in respect of him were
payable for not less than half the number of days available for working in such
contribution period
• Labour Code: Silent
EXTENDED SICKNESS BENEFIT
69
EXTENDED SICKNESS BENEFIT
• Reg. 103-A (2)- Provided further that where a person suffering from any of the
following diseases, before the commencement of the spell of sickness in which any
such disease was diagnosed being in continuous service for a period of two years
or more or where he did not have two years‟ continuous service but by virtue of
relaxation granted by the authority competent in this behalf, the insured person
qualifies to claim extended sickness benefit, he shall be entitled to medical benefit
till the end of the relevant extended benefit period :
Extended Sickness Benefit
under the ESI Act, 1948
 34 diseases
 Wages Rs. 5000 p.m.
 S.B= 115.00x91=10465.00
 309 days x Rs. 132 per day (163.93 x 80%)
 330 days x Rs. 132 per day
 Total 730 days
 Eligibility: On payment of contribution for 183 days in
preceding four contribution periods and is eligible for SB in one
period at least.
26 May 2023
• Labour Code on such Extended Sickness Benefit:
ENHANCED SICKNESS BENEFIT
75
Enhanced sickness Benefit
under the ESI Act, 1948
to promote family welfare.
7 days for men
14 days for women
Benefit paid is equivalent to the wages
Assuming the extra social responsibility of
the State
26 May 2023
But, the proposed Labour Code is silent on Enhanced Sickness
Benefit. Apparently, because it does not want the profit earning
scope of private players to be affected.
Even the concept of Corporate Social Responsibility is facilitated
by the framers of the Code to be given a go-by.
77
MEDICAL BENEFIT
78
MEDICAL BENEFIT
It is admissible from the first day of
insurable employment.
To the Insured Person and his
family members.
26 May 2023
MEDICAL BENEFIT TO PDB CASES
MEDICAL BENEFIT TO RETIRED PERSONS
SUPER SPECIALITY TREATMENTS
82
• The eligibility for super-specialty treatment is 3 months (with
contribution paid for at least 39 days) of insurable employment for
insured person (for self) and 6 months (with contribution paid for
at least 78 days) of insurable employment by Insured Person for
their family members.
• Such tertiary care (super-speciality treatment) is provided through
in-house super speciality facilities available in some of ESI
Hospitals or ESI-PGIMSRs or through large no. of advanced
empanelled medical institutions on referral basis through tie-up
arrangements.
• About 750 private hospitals in all India are now empanelled as tie-
up Hospitals for ESIC.
OTHER BENEFITS
84
UNEMPLOYMENT ALLOWANCE
Unique scheme for extending “cash-assistance” to the employees
covered under the ESI Act (Insured Persons) while they become
unemployed in certain contingencies has been introduced by the
ESI Corporation with effect from 1-4-2005.
According to this Scheme, cash payment will be given to the
affected insured persons to the maximum of one year or till re-
employed whichever is earlier.
26 May 2023
Factors constitute to determine the insured
persons as “unemployed” :
1. Permanent closure of factories /
establishments;
2. Retrenchment of employees;
3. Loss of employment due to not less than 50%
of permanent invalidity on account of accidents
happened to the insured persons other than in
the factory / establishment called as “non-
employment injury” (i.e. accidents happened in
other places (out-side accidents) for the insured
persons’ own reasons).
26 May 2023
26 May 2023
The IP eligible for unemployment allowance under the Scheme
shall also be entitled to medical care for himself/herself and
his/her family from the ESI Dispensaries/ESI Hospitals/IMPs
Clinics/ for a period of one year from the date of unemployment
or till the end of benefit period corresponding to contribution
period before unemployment, whichever is later.
In the event of death of the IP on any date prior to the expiry of
one year period of unemployment allowance, the family of the
deceased IP shall continue to be entitled to medical care for 6
months as the case would have been, had the IP remained alive.
Medical care under this scheme shall, however, be restricted to
only for the first spell of unemployment
Sec.24.5 of the Labour Code
26 May 2023
OTHER BENEFITS
 Funeral Expenses
 Vocational Rehabilitation
 Physical Rehabilitation
26 May 2023
ESIC – The benefactor par-excellence
 “The package (of benefits provided by the
ESIC) can rarely be matched by private
employers on their own because of the heavy
costs involved – not to mention the
disinclination among employers, with
honorable exceptions, to operate health care
systems for their workforce”
– The Hindu (1.1.2005).
26/05/2023 90
India has not done enough in social security
space: ILO report
 GENEVA: India has performed poorly in providing social security
protection to its people until recently with "very high vulnerability"
to poverty and informal labour practices in the world, according to a
report released by the International Labour Office (ILO) today,
16.11.2010, Times of India.
 In its first comprehensive 'World Social Security Report', the ILO
has suggested that India has not done enough in the arena of social
security protection, which is reckoned as the "human face of
globalisation, in line with its fiscal status".
Law Commission on W.C. Act, 1923
PENAL MEASURES
94
SEC. 165.2 (LIV) & SEC. 166.2 (XXXV)
• Penalties for breach or violation of rules
• These two Sections result in excessive delegation to the
Executive, and are, therefore, unconstitutional.
• The upper limit of penalties must be provided for, beforehand in
the proposed Act / Code itself.
• These two sections traverse, clearly, beyond Sec. 156 and the
Sixth Schedule.
• These two sections are only enabling provisions.
• But, these sections clearly show that the government is in an unseemly hurry
to bring in the Labour Code without having any idea of what it really wants to
achieve through the proposed Labour Code.
• The government has not yet visualised what sorts of duties are going to be
imposed on the employers and employees through the yet-to-be-born
subordinate legislations.
• It does not know what procedures are to be put in place to make the new machinery
work. But, it wants to have penal powers for breach or violation of Rules as well as
Regulations which are also going to be prepared only later.
• In essence, the government has made am attempt, through the Draft Code, to get
excessive delegation to it by the Parliament, in the matter of penalties, without
making the Parliament know the intricacies and the consequences of such a
legislation.
• A legislation cannot leave it to the Executive to correct the situation which produces
unexpected consequences.
• Sec. 97 (xvii), (xvii-a) and (xvii-b) of the ESI Act, 1948 provide for prescribing
penalties through subordinate legislations with clear-cut limits.
• In regard to the Damages, which is also a measure of penalty, Reg. 31-C of the
ESI (General) Regulations is only reducing the effect of the penalty permitted to
be imposed by the Parliament under Sec. 85-B of the ESI Act, 1948.
• The maximum limit is, thus, already, provided for by the Parliament, in Sec.84
and 85 of the ESI Act, 1948 itself, safeguarding thus the people from the
Executive. The Employees’ Provident Fund Act, 1952 also does not confer
penal power through subordinate legislations, vide its Sec. 21.
• But, the proposed Sec. 165.2 (liv) and Sec.166.2 (xxxv) do permit
the Executive to invent new areas of duties and
responsibilities for the employers and the workers and to
impose any kind of penalty on them.
• The proposed Sec. 156 does not bar the Executive from doing so.
• The Supreme Court has said, “Unlike Parliamentary legislation
which is publicly made, delegated legislation or subordinate
legislation is often made unobtrusively in the chambers of a
minister, a secretary to the Governor or other official
dignitary.”
• (ITC Bhadrachalam Paperboards Vs. Mandal Revenue Officer 1996 (6) SCC 634 and
• Harla Vs. State of Rajasthan AIR 1951 SC 467 and
• B.K. Srinivasan Vs. State of Karnataka AIR 1987 SC 1059).
• “Blanket discretionary power” has been held to be
unconstitutional in ( State of Bihar Vs. K.K. Mishra 1969 3 SCC
337 and Khwaja Ahmed Abbas Vs. Union of India 1970 2 SCC
780);
• “Unguided discretionary power” has been held to be
unreasonable in (Himat Lala K Shah Vs. Commissioner of Police
1973 1 SCC 227);
• “Wide discretionary power” (State of Madras Vs. V.G. Row 1952
AIR SC 1976) is unconstitutional because it allows the
administrative authority to exercise this discretion on subjective
satisfaction without permitting the grounds to be judicially tested.
• “Wide discretion without procedural safeguards” had been held
as unconstitutional in State of M.P Vs. Bharat Singh AIR 1967 SC
1170).
• It is not proper for the government to acquire unbridled power of imposing
penalties on the employers, employees and the members of the public who
would be treated as defaulters of non-compliance with various provisions of
the yet-to-be-born subordinate legislations. It is possible and appropriate to
bring in all the subordinate legislations also together with this Code so that
there would be no need for a carte-blanche in penal power to the authorities
through Sec. 165.2 (liv) and Sec.166.2 (xxxv), without the knowledge of the
Parliament.
• It is possible to bring in, at the initial stage itself, a comprehensive
Code covering all aspects of Social Security, as this is not a
legislation in a field where there is no other law in force. The
proposed Labour Code, is intended to replace the existing Social
Security enactments and dismantle the established structure of
those social security organisations.
• It is, therefore, essential for the Executive to place a
comprehensive Bill covering all aspects of the subject-matter,
including the manner in which the delivery machinery would
function, so that the area of defaults and the quantum of penalty
can be identified and the approval of Parliament obtained
beforehand, without any need for imposing new penalties in new
areas not covered by the Code / Act.
EXEMPTIONS
106
ESIC
• The protective umbrella for the employers
• Provides means for the economic growth of the
nation
• The safety net for the employees
• Provides proper living conditions for the work-
force
26 May 2023
The scheme was conceived originally by employers.
They took concerted action for formal legislative protection
by nations.
26 May 2023
Is the ESI Act, 1948
a compulsory
provision?
26 May 2023
The ESI Act, 1948 is
not
a compulsory provision for
any factory or establishment
There are provisions for
exemption.
26 May 2023
An employer can rightly demand
exemption,
if
the benefits provided by him to his
employees are
substantially similar
or
superior
to those provided for in the ESI Act, 1948.
26 May 2023
This condition must be really
fulfilled.
The assertion will be verified
with reference to the past
records, in spite of the
exemption already given.
26 May 2023
SEC. 87 OF THE ESI ACT, 1948
• 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 :
• Provided further that an application for renewal shall be made three months before the date
of expiry of the exemption period and a decision on the same shall be taken by the
appropriate Government within two months of receipt of such application.
SEC. 88 OF THE ESI ACT, 1948
• 88. Exemption of persons or class of persons. —
• The appropriate Government may, by notification in the Official
Gazette and subject to such conditions as it may deem fit to
impose, exempt any person or class of persons employed in any
factory or establishment or class of factories or establishments to
which this Act applies from the operation of the Act.
SEC. 89 OF THE ESI ACT, 1948
• 89. Corporation to make representation. —
• No exemption shall be granted or renewed under section
87 or Section 88, unless a reasonable opportunity has
been given to the Corporation to make any
representation it may wish to make in regard to the
proposal and such representation has been considered
by the appropriate Government.
• There is no provision analogous to Sec. 89 of the ESI Act in the proposed
Labour Code, necessitating consultation with the S.S. Organisation before
granting exemption.
• Means, the S S Organisation is not the monitoring agency of the Social
Security net stated to be provided to the working population.
• Employers used to be challenged with Sec. 89 and 90.
• Sec. 89 ensures that the ESIC carries out the Constitutional mandate as per
Art. 41.
• Reasonable opportunity was there for the ESIC to represent.
SEC. 90 OF THE ESI ACT, 1948
• 90. Exemption of factories or establishments
belonging to Government or any local authority.
— The appropriate Government may, after
consultation with the Corporation, by notification
in the Official Gazette and subject to such
conditions as may be specified in the notification,
exempt any factory or establishment belonging to
any local authority, from the operation of this Act] if
the employees in any such factory, or establishment
are otherwise in receipt of benefits substantially
similar or superior to the benefits provided under
this Act.
SEC. 91 OF THE ESI ACT, 1948
• 91. Exemption from one or more provisions of
the Act. — The appropriate Government may, with
the consent of the Corporation, by notification in
the Official Gazette, exempt any employees or class
of employees in any factory or establishment or
class of factories or establishments from one or
more of the provisions relating to the benefits
provided under this Act.
• Also Sec. 1 (4).
SEC. 17 (2) OF THE EPF ACT, 1952
• (a) any establishment to which this Act applies, if,
in the opinion of the appropriate Government, the
rules of its provident fund with respect to the rates
of contribution are not less favourable than those
specified in section 6 and the employees are also in
enjoyment of other provident fund benefits which
on the whole are not less favourable to the
employees than the benefits provided under this Act
or any Scheme
• in relation to the employees in any other
establishment of a similar character;
• (b) any establishment if the employees of such
establishment are in enjoyment of benefits in the
nature of provident fund, pension or gratuity and
the appropriate Government is of opinion that such
benefits, separately or jointly, are on the whole not
less favourable to such employees than the
benefits provided under this Act or any Scheme
• in relation to employees in any other establishment
of a similar character.
• (IC) The appropriate Government may, by
notification in the Official Gazette, and subject to
the condition on the pattern of investment of
pension fund and such other conditions as may be
specified therein, exempt any establishment or
class of establishments from the operation of the
Pension Scheme if the employees of such
establishment or class of establishments are either
members of any other pension scheme or propose to
be members of such pension scheme, where the
pensionary benefits are at par or more favourable
than the Pension Scheme under this Act
• (2) Any Scheme may make provision for exemption
of any person or class of persons employed in any
establishment to which the Scheme applies from
the operation of all or any of the provisions of the
Scheme, if such person or class of persons is
entitled to benefits in the nature of provident fund,
gratuity or old age pension and such benefits,
separately or jointly, are on the whole not less
favourable than the benefits provided under this
Act or the Scheme:
• (2A) The Central Provident Fund Commissioner may, if
requested so to do by the employer, by notification in
the Official Gazette, and subject to such conditions as
may be specified in the notification, exempt, whether
prospectively or retrospectively, any establishment
from the operation of all or any of the provisions of the
Insurance Scheme, if he is satisfied that the
employees of such establishment are, without making
any separate contribution or payment of premium, in
enjoyment of benefits in the nature of life insurance,
whether linked to their deposits in provident fund or
not, and such benefits are more favourable to such
employees than the benefits admissible under the
Insurance Scheme.
• (2B) Without prejudice to the provisions of sub-
section 2A, the Insurance Scheme may provide for
the exemption of any person or class of persons
employed in any establishment and covered by that
scheme from the operation of all or any of the
provisions thereof, if the benefits in the nature of
life insurance admissible to such person or class of
persons are more favourable than the benefits
provided under the Insurance Scheme.
SEC. 94. 1 (H) OF THE DRAFT
LABOUR CODE
• The authorities who prepared the draft Code had taken a conscious, deliberate and
calculated decision to drop the word “substantially” before the word “similar”
appearing therein.
‘SUBSTANTIAL’ - LEFT OUT .
WHY?
• The term “substantial” can have a qualitative meaning and be
defined as “important” or “essential”, and can have a quantitative
meaning and be defined as “considerable in quantity” or
“significantly great” in amount. This word precludes invoking the
‘de minimis’ principle. (Page 812 – Concise Law Dictionary – Wadhwa Publication).
• Yet, such an important word has, consciously, been left out in
Sec. 94 of the Draft Labour Code in ‘Part L’ which deals with
exemption.
SUBSIDY
127
SUBSIDY – SEC. 22.6
• Enabling provision for providing “subsidy” to “the
employer” under Sec. 22.6 (b) from the Welfare
Funds, by the State Board and in aid of any
scheme;
• Also to give subsidy to the employer to provide for
“defraying the cost” of “provision of cost of
transportation to and from work” for the
employees under Sec. 22.6 (d) (vi).
• Contrast this with Sec. 51 – C of the ESI Act.
• 51-C. Accidents happening while travelling in employer’s transport. —
• (1) An accident happening while an employee is, with the express or implied
permission of his employer, travelling as a passenger by any vehicle to or from his
place of work shall, notwithstanding that he is under no obligation to his employer to
travel by that vehicle, be deemed to arise out of and in the course of his
employment, if —
(a) the accident would have been deemed so to have arisen had he been under
such obligation ; and
(b) at the time of the accident, the vehicle —
• (i) is being operated by or on behalf of his employer or some other person by whom
it is provided in pursuance of arrangements made with his employer ; and
• (ii) is not being operated in the ordinary course of public transport service.
(2); In this section ― vehicle includes a vessel and an aircraft.
PURPOSE OF SEC. 22.6
•To provide lump sum payment by the State
Governments to the businessmen who act as
‘Intermediate Agencies’ ?
SUBORDINATE LEGISLATIONS
132
C.K. Allen
Carleton Kemp Allen- Law and Order - (1945) – Law in the making (1927)
Subordinate legislations provide for convenience, flexibility and efficiency
with respect to the delegation of such powers.
But, Allen says that all these arguments regarding convenience, flexibility
and efficiency are “sound arguments for delegation within due limits,
the kind, in fact, which has always been recognized as a practical and
necessary part of our governmental system. But they become unsound
and dangerous if they are used to justify the indefinite extension of
executive powers. Speed and efficiency may be bought at too high a
price, and indeed we should have learned from many examples that the
State which makes efficiency its highest god is very apt to become an
all-devouring monster”.
133
RULES
134
RULE MAKING POWERS OF THE
CENTRAL GOVERNMENTS
• Sec. 165
RULE MAKING POWERS OF THE
STATE GOVERNMENTS
RULE MAKING POWERS OF THE
STATE GOVERNMENTS
• Powers of the State Governments must be listed in an independent Section just like
Sec. 165 which deals with the Powers of Central Government to make Rules.
• The principles of Legislative Drafting do not permit the “Rule-making power of the
State Governments” to be shown in the sub-section of Sec. 165 here.
• Secondly, all the areas with reference to which powers must be conferred on the
State Government must be enumerated, in a thoroughly exhaustive manner in
the Code / Act itself, to facilitate enactment of Subordinate Legislation in all respects
addressing all the nitty-gritties of monitoring and delivery mechanisms.
REGULATIONS
138
REGULATIONS
• National Council is empowered to make Regulations. Sec. 166.
• Details not known.
• Asked under the RTI Act to supply the copies of the proposed Regulations and the
Schemes referred to in Sec. 24 of the said Draft Labour Code on Social Security &
Welfare.
BYE-LAWS
140
BYE LAWS
• 2.59 : “Bye –Laws ” means the bye –laws framed by the Central Board.
• Central Board is competent to make Bye-laws (by-laws). Sec. 166.3 & 166.4.
• Both terms used in the code which is improper.
• Details asked for under the RTI Act.
SCHEMES
142
SCHEMES
IMMEDIATE AGENCIES
144
2.68
•“intermediate agency” means any Fund
manager agency, Point of presence Agency,
Service delivery Agency, Benefit
disbursement Agency or Recordkeeping
Agency licensed under Section 88(1)
145
IMMEDIATE AGENCIES
• It is apparent, from Sec. 88 of the Draft Code, that the persons who were
imaginative enough to bring in so many agencies must have visualized the future
scenario and recorded how such agencies would function in practice.
• But, they have not made it public.
• This Section is going to be used for virtual privatisation of the Social Security.
• (a) Fund Manager Agency,
• (b) Point of Presence Agency,
• (c) Service Delivery Agency,
• (d) Benefit Disbursement Agency,
• (e) Record Keeping Agency and
• (f) Facilitation Agencies.
SEC. 88.2
• The intermediate agency, for grant of license, shall satisfy the eligibility norms as
may be stipulated, including minimum capital requirement, past track record, ability
to provide guaranteed returns, cost and fees, geographical reach, customer base,
information technology capability, human resources and such other matters as may
be stipulated
SEC 166.2 – POWER OF THE NATIONAL COUNCIL TO
MAKE REGULATIONS
• (xxiii) duties and functions of intermediate agencies
• (xxiv) eligibility norms for grant of license to an intermediate agency
• (xxv) form and manner of making application for license of intermediate
• agency
• (xxvi) manner of cancellation of license of intermediate agency
• Are these Intermediate Agencies under Sec. 88.1 amenable to the provisions of the
RTI Act?
• Are they public authorities?
• Can the ‘Scheme Members’ demand information from them and inspect their
records as per the RTI Act?
• This is the most important question to be answered by the Ministry.
SEC. 115 OF THE CODE DOES NOT REFER TO THOSE AGENCIES
AGENCIES
• “Intermediate Agencies” and “Agencies”
• These two phrases are interchanged at different places.
• This is not a proper course of legislative writing.
 The Public must be informed of the concept and intricacies of
these Agencies-system, and the contents of the Schemes
proposed on all the Social Security benefits.
 Because, that alone would provide a holistic view of the
‘reforms’ proposed.
 That alone would make the people know about the real and
consequential effect of the proposed Code.
154
 Sec. 88.1 of the Code says that the “Director General may, by
granting a License under this Code, permit any organization or
person to act as an intermediate agency for all or any of the
purposes” mentioned against each of the six agencies
enumerated therein.
155
 Sec, 88.3 of the Code says that “an intermediate agency shall
function in accordance with the terms of its License and the
Regulations”.
 Sec. 88.4 implies that the terms and conditions of such a license
will be “in accordance with the provisions of this Code and the
Regulations”.
 Sec. 88. 5 says that the application for such a license will be in
a specified form.
156
HOUSEHOLD WORKERS
157
HOUSEHOLD WORKERS
CENTRAL SOCIAL
SECURITY SERVICE
159
CENTRAL SOCIAL SECURITY
SERVICE
• Sec. 112.1 – left blank.
LICENSE
161
• Sec. 88.1 of the Code says that the “Director General may, by granting a License
under this Code, permit any organization or person to act as an intermediate
agency for all or any of the purposes” mentioned against each of the six agencies
enumerated therein. Those agencies are: (a) Fund Manager Agency, (b) Point of
Presence Agency, (c) Service Delivery Agency, (d) Benefit Disbursement Agency,
(e) Record Keeping Agency and (f) Facilitation Agencies.
LICENSE
•Asked under the RTI Act to supply the copies
of the format of the proposed License
(containing the Terms and conditions imposed
by the Government on the agencies) referred
to in Sec. 88 and 89 of the said Draft Labour
Code on Social Security & Welfare;
RETURNS TO BE FILED.
RECORDS TO BE
MAINTAINED
ONLINE PAYMENT SYSTEM
26 May 2023
166.4
Central Board may provide for matters relating or incidental to—
• (i) Form of Registers, records, books of accounts and other documents
required to be maintained by employers, establishments, contractors,
works contactors, landlords, owner of a mine, producer of a film, self-
employed units, person deducting contribution at source and intermediate
agencies; and manner in which such records shall be maintained.
• (ii) form and manner in which application for registration (for workers or
establishments) shall be made
• (iii) form and manner in which application for cancellation, deactivation or
reactivation (for workers or establishments, as applicable) shall be made
26 May 2023
TERMS NOT DEFINED
26 May 2023
• Commission and piece rare worker: Sec. 2.21
• Monthly income: Sec. 2.84.
• Part-time worker: Sec. 2.96 (Definition is not clear.
Some words are, obviously, missing between the word
‘government’ and the phrase ‘of work’. )
• Sec. 74.9 contains question marks, indicating
incomplete spade work, before posting in public domain
calling for the opinion of the public.
????
PUBLIC INTEREST
26 May 2023
The Registrar, Thiyagarajar College of Engineering, Madurai Vs. The
Registra, Tamilnadu Information Commission – 30.04.2013
 Hon’ble High Court of Madras has observed, “Public Interest means an
act beneficial to the general public.
 Means of concern or advantage to the public, should be the test.
 Public interest in relation to public administration, includes honest
discharge of services of those engaged in public duty.
 To ensure proper discharge of public functions and the duties, and for the
purpose of maintaining transparency, it is always open to a person
interested to seek for information under the Right to Information Act,
2005”
26 May 2023
AN ANALYSIS
174
175
26 May 2023
177
26 May 2023
179
Just-in-time-scheduling
• Just-in-time scheduling is another part of
America’s new “flexible” economy
- Robert Reich
26 May 2023
Just-in-time scheduling
26 May 2023
• “Organisations must have the flexibility to adjust the
number of this workforce based on economic efficiency”
- Second National Commission of Labour
26 May 2023
26 May 2023
The purpose of inspection divisions
of the ESI Corporation is to ensure
that no person who should be
provided security-net under the ESI
Act, 1948 is left uncovered and
that no amount of wages paid to
him is left by the employer for
calculating the amount of
contribution.
184
26 May 2023
26 May 2023
Germany Vs. India
Otto von Bismarck
Choice is ours
•Social Security
or
•Social unrest
26 May 2023
26 May 2023
The Standard Vacuum Refining Co.of India Ltd.Vs. Workmen
Contract labour
should not be employed where:
(a) The work is perennial and must go on from day to day;
(b) The work is incidental to and necessary for the work of the
factory;
(c) The work is sufficient to employ considerable number of whole
time workmen; and
(d) The work is being done in most concerns through regular
workmen.
1960 -SC
189
CLRA ACT,
STATEMENT OF OBJECTS AND REASONS
26 May 2023
Why has Japan succeeded?
Prof. Michio Morishima emphasises the importance of the role played in
the creation of Japanese capitalism by ethical doctrines as transformed
under Japanese conditions , especially the Japanese Confucian
tradition of complete loyalty to the firm and to the State.
Tactics to make mincemeat of Labour Laws
 The Executive cannot bring in a truncated version of the
proposed system in the form of Code and ask the MPs to vote.
But, that, exactly, is what the bureaucracy has, exactly, done
through this Draft Labour Code. Sec. 24.5 of the Code
enumerates the nomenclature of the benefits that would be
made available to the workforce.
194
 But, the quantum of benefits and the nature of machinery
through which such benefits would be provided have not been
made known.
 These issues have been kept reserved for the Executive to
make Subordinate Legislations later.
195
 ESI Corporation is not a business organisation preparing profit
and loss account. (Contrast – Sec. 165 (2) (xxxvi) regarding
“Conditions under which losses may be written off”).
 It is a service organisation preparing income and expenditure
statement.
 But, the very wordings of Sections 2.58, 2.68, 2.101, 2.109,
2.123 and Sec. 88. show that the intention behind the Code is
to handover the operative side of the scheme to private
businessmen who enter into the field with profit motive.
196
2.58
 "fund management agency” means an agency licensed under
section 88(1)) to perform functions of professional
management, investment and custody of accumulations in a
social security fund or scheme fund.
197
2.68
 “intermediate agency” means any Fund manager agency, Point
of presence Agency, Service delivery Agency, Benefit
disbursement Agency or Recordkeeping Agency licensed under
Section 88(1)
198
2.101
 “Point of presence Agency” means an agency licensed under
section 88(1) for receiving contributions and instructions and
transmitting them to the Trustee Bank or Record keeping
agency;
199
2.109
 "Record keeping agency” means an agency licensed under
section 88(1) to perform functions of record-keeping,
accounting, administration and customer service for members
of any scheme.
200
2.123
 “service delivery agency” means an agency licensed under
section 88(1) for the purposes of providing services, medical or
otherwise, and other non-financial benefits under any Schemes.
201
88.2 – 88.6 - Privatisation
202
203
What was the position when
there was no social security
system and no ESI Corporation?
26 May 2023
26 May 2023
Other indicators of privatisation
206
Samuel Gompers
President of the American Federation of Labor between 1886 and 1924
 "When a dominating class wants to keep a subject
class under its control, what better way to distract
it than to keep it fighting amongst itself. If a
subject class is kept busy fighting each other as
individuals and trying to gain small advantages or
favouritism over each other, it will be all the
easier to keep them in check. A subject class
which is divided on the basis of arbitrary and
superficial differences such as sex, race or
nationality will always remain subject”
26 May 2023
The Constitution of the ILO
was drafted between January
and April, 1919, by the
Labour Commission set up
by the Peace Conference,
which first met in Paris and
then in Versailles. The
Commission was chaired by
Samuel Gompers.
26 May 2023
Bangalore April 18, 2016
26 May 2023
26 May 2023
26 May 2023
 “According to Jayaram K.R. from the Garment and Textile Workers’ Union,
the protest was against the union government’s amendment of the Act. As
per the new amendment, people will be able to withdraw only their
(employee’s) contribution to their provident fund accounts. They will be
able to withdraw the employer’s contribution only after they are 58-years-
old.
 Stating that this was “anti-workers”, Mr. Jayaram said that if there was no
contribution to the provident fund, the workers will be entitled to only three
years’ of interest on their employer’s contribution.
 “The main contention is that many workers of the unorganised sectors are
not sure of being employed till they are 58-years-old. Workers, who are over
40 years, are unsure, as they may not be able to find suitable jobs,” he said.”
26 May 2023
26 May 2023
26 May 2023
The basic need for all human beings
Security
in life
on all fronts
26 May 2023
Second National Labour Commission Report
216
217
Contract Labour
should not be for monetary gain
218
Work Culture Vs. Worker’s culture
219
Leisure is a basic necessity
220
First National Labour Commission
was for 40 hours week
221
Less over time and spread over
222
Earlier law should prevail
223
Inspection necessary
224
• “Law is the great civilizing
machinery.
• It liberates the desire to build and
subdues the desire to destroy.
• And if war can tear us apart,
Law can unite us – out of fear, or
love or reason, or all three.
• Law is the greatest human
invention. All the rest, give man
mastery over his world. Law gives
him mastery over himself”.
Lyndon B.Johnson,
TIME September 24, 1965
Is the role of the State necessary
in the scheme of things?
26 May 2023
Assures proper and
corruption-free
administration to
achieve the purpose
of the Scheme.
26 May 2023
“Health is one area in
which the public sector
consistently does a better
job than the private sector
at controlling costs”
-Paul Krugman
Nobel Prize winner
(The Hindu – 14.6.2011)
228
26 May 2023
26 May 2023
26 May 2023
The wealthiest nations do not have
the healthiest people;
instead,
it is countries with
the smallest economic gap between
the rich and poor.
(Mark Bourrie – Inter Press Service -23.7.1999).
26 May 2023
26 May 2023
26 May 2023
What should be objective of a nation?
• Top in the list of GDP.
• Top in the list of Percapita income.
• Top in the list of possession of nuclear arms.
• Top in the list of number of billionaires.
• Top in the list of Human Development Index.
• Top In the lsit of Global Prosperity Index.
26 May 2023
Human Development Index
• Top Scandinavian countries.
• India 130 /188
• Human development is defined as the process of enlarging people's freedoms and opportunities and
improving their well-being. Human development is about the real freedom ordinary people have to
decide who to be, what to do and how to live.
26 May 2023
Global Prosperity Index
• India ranked 99 out of 142 countries on a prosperity index.
• The rankings, produced by a London-based think tank, the Legatum Institute, gauge the prosperity of a
nation by combining economic indicators, including gross domestic product, with dozens of other
measures of wellbeing, from access to education and health to the living environment for ethnic
minorities.
• The index is based on the logic that “prosperity is more than just the accumulation of material
wealth”.
• In this year’s rankings, Norway topped the list for the seventh consecutive year, followed by Switzerland,
Denmark and New Zealand.
26 May 2023
26 May 2023
Has to be run only by Governments
The ESI Scheme in India which collects only 1.75% of wages as
Employees Contribution is still viable for almost 6 decades
without any assistance from Central Government, only
because it is compulsory and also because the field of
dispersal of benefit load is larger. This is in sharp contrast to
the position obtaining in smaller countries where the
employees contribution is much more, ranging from 27 to 73%.
26 May 2023
High Court of Madras
[Chandramathi Vs. ESIC – 2003 (4) LLN. 1143]
 “The object of the legislation
is to protect the weaker
section with a view to do
social justice”
26 May 2023
High Court of Madras
[C. Indira Vs. Senthil & Co – 2009 (2) LLN 302]
 “The object of the Act is to provide certain benefits to the
employees or dependants in case of sickness, maternity
and employment injury, etc., to give effect to Art. 1 of
the Universal Declaration of Human Rights, 1948, which
assures human sensitivity of moral responsibility of every
State that all human beings are born free and equal in
dignity and rights” .
26 May 2023
ESIC renders
Distributive Justice
26 May 2023
Supreme Court of India
Samatha Vs. State of Andhra Pradesh (1997) 8 SCC 191 (Para 75)
 “The core constitutional objective of ‘social and economic democracy’ in
other words, just social order, cannot be established without removing
the inequalities in income and making endeavour to eliminate
inequalities in status through the rule of law. The mandate for social and
economic retransformation requires that the material resources or their
ownership and control should be so distributed as to subserve the
common good.
 Contd.
26 May 2023
Supreme Court of India
Samatha Vs. State of Andhra Pradesh (1997) 8 SCC 191 (Para 75
Contd.)
 …. A new social order, therefore, would
emerge, out of the old unequal or hierarchical
social order. The legislative or executive
measures, therefore, should be necessary for
the reconstruction of the unequal social order
by corrective and distributive justice through
the rule of law”
26 May 2023
Universal Declaration of
Human Rights
• Preamble
• Whereas recognition of the inherent dignity and of the equal and inalienable rights of all members of the human family is the foundation of freedom,
justice and peace in the world,
• Whereas disregard and contempt for human rights have resulted in barbarous acts which have outraged the conscience of mankind, and the advent of a
world in which human beings shall enjoy freedom of speech and belief and freedom from fear and want has been proclaimed as the highest aspiration of
the common people,
• Whereas it is essential, if man is not to be compelled to have recourse, as a last resort, to rebellion against tyranny and oppression, that human rights
should be protected by the rule of law,
• Whereas it is essential to promote the development of friendly relations between nations,
• Whereas the peoples of the United Nations have in the Charter reaffirmed their faith in fundamental human rights, in the dignity and worth of the human
person and in the equal rights of men and women and have determined to promote social progress and better standards of life in larger freedom,
• Whereas Member States have pledged themselves to achieve, in co-operation with the United Nations, the promotion of universal respect for and
observance of human rights and fundamental freedoms,
• Whereas a common understanding of these rights and freedoms is of the greatest importance for the full realization of this pledge,
• Now, Therefore THE GENERAL ASSEMBLY proclaims THIS UNIVERSAL DECLARATION OF HUMAN RIGHTS as a common standard of achievement for all
peoples and all nations, to the end that every individual and every organ of society, keeping this Declaration constantly in mind, shall strive by teaching
and education to promote respect for these rights and freedoms and by progressive measures, national and international, to secure their universal and
effective recognition and observance, both among the peoples of Member States themselves and among the peoples of territories under their jurisdiction.
26 May 2023
• Whereas recognition of the inherent dignity and of
the equal and inalienable rights of all members of the
human family is the foundation of freedom, justice
and peace in the world,
• Whereas disregard and contempt for human rights
have resulted in barbarous acts which have
outraged the conscience of mankind, and the advent
of a world in which human beings shall enjoy
freedom of speech and belief and freedom from fear
and want has been proclaimed as the highest
aspiration of the common people,
• Whereas it is essential, if man is not to be compelled
to have recourse, as a last resort, to rebellion
against tyranny and oppression, that human rights
should be protected by the rule of law,
26 May 2023
Universal Declaration of
Human Rights
All human beings are born free and
equal in dignity and rights.
They are endowed with reason and
conscience and should act towards
one another in a spirit of
brotherhood.
• -Article 1
26 May 2023
Universal Declaration of
Human Rights
Everyone, as a member of society,
has the right to social security
• -Article 22
26 May 2023
26 May 2023
Consequently, the ESI Act, 1948 is born as
part of the first package of labour welfare
measures immediately after Indian
independence.
Fundamental Principles
1. The proposed scheme must not be too ambitious in the
beginning;
2. It must be simple, clear and straightforward,
3. It must be financially sound, economical in working and
actuarially balanced;
4. It must minimize disputes and litigation;
5. It must be workable in the peculiar circumstances of
Indian labour and industry;
26 May 2023
Courtesy: Times of India
26 May 2023
Fundamental Principles (Contd.)
6. It must be in conformity with international labour
conventions;
7. It must not be saddled with financial
responsibilities which belong to other measures of
social security and finally
8. It must be sufficiently flexible.
26 May 2023
Not to be saddled
 For the success of the ESI Scheme, Prof. Adarkar wanted
certain extra measures to be taken. His stand was that
the ESI Scheme should not be “saddled with
burdens legitimately belonging to other branches
of social insurance”. Therefore, while formulating the
ESI Scheme, he made four assumptions for its success.
26 May 2023
Four Assumptions
 (a) Adoption of a scheme for Unemployment Insurance and
creation of new employments in the post war period,
 (b) Establishment of a scheme of Old Age Pension,
 (c) Adoption of certain pre-medical measures like education in
health and improvement in environment hygiene besides
regulation of wages and rigorous enforcement of factory laws and,
finally,
 (d) National Health Drive.
26 May 2023
Art. 41 of the Constitution
The State shall, within the limits of its economic capacity and
development, make effective provision for securing public
assistance in case of unemployment, old-age, sickness,
disablement and other cases of undeserved wants.
26 May 2023
Public Assistance
a
Constitutional responsibility
 Private
Assistance?
26 May 2023
 What is Art. 42?
 Why is it there in the Directive Principles?
26 May 2023
26 May 2023
The social security system of a country is
the symbol of civilisation.
The extent of its success depends upon the degree of
maturity of the society as a whole.
Robert Owen
 “What ideas individuals may attach to the term "Millennium" I know not; but
I know that society may be formed so as to exist without crime, without
poverty, with health greatly improved, with little, if any misery, and with
intelligence and happiness increased a hundredfold; and no obstacle
whatsoever intervenes at this moment except ignorance to prevent such a
state of society from becoming universal.”
 - Robert Owen, 1.1.1816
when he opened the
Institute for the Formation of Character.
26 May 2023
26 May 2023
Civil Service, Political set up
&
Moral standards of the society
261
 Responsibility of thinkers, leaders and
individuals.
சான
் ற ாரும் உண
் டுக ால்?
262
There is a definite role for
You !
26 May 2023
Thankyou!
26 May 2023

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labour-code-for-flourishing-esic.pptx

  • 1. LABOUR CODE ON SOCIAL SECURITY Contents & Consequences
  • 2. Second National Labour Commission Report 2
  • 4.
  • 6. Representation in supreme bodies Sl. No. Name of the Organisation Supreme Body No. of employers’ and employees’ representatives. 1 ESI Act, 1948 ESI Corporation 10 + 10 2 EPF Act, 1952 Central Board 10 + 10 3 UWSS Act, 2008 National Board 7 + 7 4 Gratuity Act, 1972 5 Cine Workers Act, 1981 (Rule 3) Central Advisory Committee 7 + 7 6 Mica Mines Labour Welfare Fund Act, 1946 Central Advisory Committee 6 + 6 7 Limestone and Dolomite Mines Labour Welfare Fund Act, 1972 Central Advisory Committee 6 + 6 26 May 2023
  • 7. Representation in supreme bodies Sl. No. Name of the Organisation Supreme Body No. of employers’ and employees’ representatives. 8 Iron Ore Mines, Manganese Ore Mines, Chrome Ore Mines Labour Welfare Fund Act, 1976 Central Advisory Committee 6 + 6 9 Beedi Workers Welfare Fund Act, 1976 Central Advisory Committee 7 + 7 Total Members representing all these categories of employees 59 + 59 No. of representatives proposed for the National Council under the Labour Code (Sec. 3.3) 3 + 3 26 May 2023
  • 8. Representation in supreme bodies Sl. No. Name of the Organisation Supreme Body No. of employers’ and employees’ representatives. 7 Iron Ore Mines, Manganese Ore Mines, Chrome Ore Mines Labour Welfare Fund Act, 1976 Central Advisory Committee 6 + 6 8 Beedi Workers Welfare Fund Act, 1976 Central Advisory Committee 7 + 7 Total Members representing all these categories of employees 59 + 59 No. of representatives proposed for the National Council under the Labour Code (Sec. 3.3) 3 + 3 26 May 2023
  • 9. Table of Welfare Funds 26 May 2023
  • 11. NATIONAL COUNCIL • Under representation of employers and employees representatives in the National Council. • At present, the draft Code says that only three employees’ representatives are contemplated for National Council, and, there is likely to be three employers representatives too. • This is a clear case of under-representation.
  • 12. EXECUTIVE COMMITTEE • Executive Committee of the National Council • It will have 2 + 2. Among them, one will be from the opposition side. • And, he must be an expert on all these fifteen enactments to explain the case of the employees. • In fact, the draft Code says that the Executive Committee shall consist of, among others, “two persons representing the employers elected by the National Council from amongst the persons representing employers”. • • But, Sec. 3.3 which specifies the constitution of the National Council does not have any provision to have any member who is the representative of employers. • • This is an apparent omission and has to be set right . Ministry has promised it.
  • 13. What is the motive? 26 May 2023
  • 14. • There must, at least, be 15 employers’ representatives and 15 employees’ representatives in the National Council. Otherwise, the National Council and Executive Committees will only be make believe dummy arrangements. • Democracy means more noise and less problems. • As an all-India body, the National Council which is required to deal with the problems of the workforce running into crores and crores of Indian citizens deserve better and proper representation in the National Council, more so, when so many enactments are combined together.
  • 15. • The ESI Corporation caters to the needs of about 8.28 crore beneficiaries as on 31.03.2016 and protects the interests of 7.83 lakhs employers. The supreme body of the organisation, the ESI Corporation, consists of about 60 persons (31 appointed by the Central Government + three deputed by two houses of the Parliament+ one each for every State). • Of the 31 appointed by the Central Government, 10 are employers’ representatives and 10 are employees’ representatives, as per Sec. 4 of the ESI Act, 1948.
  • 16. •Likewise, the EPFO does also have 10 representatives each for employers and employees, vide Sec. 5 A of the EPF and MP Act, 1952. •But, the proposed legislation reduces the representation of these important stake- holders in the supreme body to a token presence, for the reasons not made known.
  • 17. • Experience of these two organisations is that even when the representation for employers and employees has been ten each, the political parties which happened to occupy power at the Centre for a maximum period of five years at a time, did not allow these organisations to function free from political intrigues. • Such an attitude played havoc with the system. These parties in power filled up many of these 20 slots meant for employers and employees with their own ‘yes-men’ giving only a few slots to the opposition parties or other deserving persons, and that too, very grudgingly.
  • 18. • In fact, the political parties which happened to be in power wanted to manipulate and appropriate these organisations for their private ends on many an occasion. • As that was the general tendency of the political parties in power, the presence of the competent employers and employees representatives belonging to the other side was reduced just to tokenism, when there were ten representatives each for both categories.
  • 19. • But, now, the representation is proposed to be drastically reduced to three representatives each for employers and employees. • This will result in total disappearance of even that token presence of the opposition parties in the supreme body. • The present proposal in the draft Code to have only three representatives each for employers and the employees is surely an attempt at stifling the voices of employers and employees, and that too, at the level of the national body.
  • 20. • This may be projected and defended by the Ministry as a political decision or policy decision. But, the fact is that this is simply an arbitrary decision, without taking into account the national interest. • Common man is entitled to know what difficulties were felt by the Central Government when there were ten representatives each for employers and employees, both in the ESIC and in the EPFO. Significantly, the Ministry has not put in public domain the relevant “Statement of Objects and Reasons” which would have thrown light on the issue.
  • 21. • Administering the Social Security Organisation of the nation is an apolitical work and it must be left free from political calculations and other extraneous considerations. • The present decision to reduce the number of representatives to three each is patently arbitrary and anti-democratic, without a ray of doubt.
  • 22. • The proposed National Council deserves larger representation from a wider spectrum of the employers and employees throughout the nation permitted in the supreme body. • It is, therefore, suggested that the draft Labour Code may be modified to facilitate inclusion of, at least, 15 representatives for employers and 15 for employees. • Because, the proposed Code amalgamates so many government and government oriented-organisations, including the two major organisations, the ESIC and the EPFO, where ten representatives on either side were in the respective supreme governing bodies.
  • 23. • The parties in power at the Centre should not give the impression that they are afraid of facing the representatives of the people by reducing their representation in the proposed National Council. • It is, therefore, proposed that the National Council may be made to have 15 employers’ representatives and 15 employees’ representatives.
  • 24. SECOND NATIONAL LABOUR COMMISSION • Terms of Reference: • 1. Review the existing labour laws in the organised sector in the changing economic context and • 2. suggest comprehensive legislation to ensure a minimum level of protection to workers in the unorganised sector. • AITUC, CITU, HMS were not consulted about the terms of reference. • Nor were they involved in the Commission's proceedings. Only the BMS and the INTUC were represented in the Commission.
  • 25. •Will such a political party consider the case of the other Trade Unions and provide them a slot in the National Council, in the three seats?
  • 27. CONTRIBUTION • At present: • ESIC = Employee 1.75% + Employer 4.75% • EPFO = Employee 12% + Employer 12% + Administrative Charges = 0.65% • Employers’ total share = 17.4% • Proposed (Labour Code Sec. 20.1): • State Social Security Fund – Centre to notify (not exceeding) Employers’ Share = 17.5% • (Sec. 20.2) : • State Gratuity Fund Employers’ Share = 2% • Administrative Charges = (will be specified by National Council u/S 165(2) (xxvi) • Employers’ total share = 19.5% + Administrative Charges
  • 28. CONTRIBUTION • At present: • Employees’ total share = 13.75% • Proposed (Labour Code Sec. 20.3): • Employees’ total share = 12.5% • Self Employed = 20%
  • 29. BENEFITS TO THE WORKERS UNDER THE LABOUR CODE 26 May 2023
  • 30. BENEFIT •Maternity Benefit = Sec. 53-60. •Disablement Benefit = Sec. 66-77. •Dependent Benefit = Sec. 66-77 •Sickness Benefit = Sec. 78-82. •Medical Benefit = Sec. 83-87.
  • 31. BENEFITS TO THE INSURED PERSONS UNDER THE PRESENT ESI ACT 26 May 2023
  • 33. MATERNITY BENEFIT • Subscription compulsory – 54.5 – • Should have actually worked for a period of not less than 80 days in the twelve months preceding the date of expected confinement. (55.2) • Period – 26 weeks (less than 2 surviving children) – 12 weeks in other cases. • For, Adopting mother and Commissioning mother – 12 weeks. • Rate of Benefit: (57). • At the rate of Benefit Wage. • Benefit Wage = Amount of wages deemed to be payable for a month’s service (Sec. 2.12).
  • 34. BENEFIT WAGE • Employee in service for a continuous period of not less than 12 months –Preceding 12 months wages ÷ 12 • In service for a period of less than 1 month = ? (2.12. (b). • In service for more than 1 month but less than 12 months = 30 x Total wages earned in respect of the last continuous period of service ÷ No. of days comprising such period. (?) • When not possible to calculate the monthly wages for want of necessary information = Such rate as stipulated for various classes of employment.
  • 35. Maternity Benefit under the ESI Act, 1948 • Wages Rs. 5000 p.m. • Standard Benefit Rate Rs. 163.93 • Maternity Benefit = SBR • Cash Benefit for 84 days initially. • Can be extended for another 30 days in case of sickness due to pregnancy or confinement. • One month MB = 164x30 = 4920 26 May 2023
  • 36. Maternity Benefit under Labour Code • Subscription compulsory • 54.5 • Subscription to the Maternity Benefit Scheme shall be compulsory for every worker covered under sub-section (2), irrespective of his or her entitlement, gender, ability or intention to avail the benefits of Maternity Benefit Scheme. 26 May 2023
  • 38. DEPENDENTS BENEFIT •Employment Injury that is fatal = 50% of the Benefit Wage (Sec. 63.1) •ESIC, at present provides 90% of the Standard Benefit Rate.
  • 39. SEC. 63.(1) (A) OF THE LABOUR CODE
  • 40. RULE 58 (2) OF THE ESI (CENTRAL) RULES,1950
  • 41. • Rule 2 (7-A) of the ESI (Central Rules) 1950 , adds that standard benefit rate means average daily wages obtained by dividing the total wages paid during the contribution period by the number of days for which these wages were paid. • This works out approximately to 90% of th wages of the deceased employee or, in certain cases, more than that amount.
  • 42. • Even in the year 1952, the Dependant’s Benefit was about 70 % of the wages. • The Sickness benefit itself was about 55% of the wages, then. • So, reducing the quantum of Dependant’s benefit to 50% of the wages does not show that the intention of the Code-makers is to improve the standard of living of the workforce. • This is patently unfair, unjust and unlawful. • It is worth-comparing, in the context, that even the Sickness Benefit is 70% of the Standard Benefit Rate under the ESI Scheme, at present.
  • 43. Dependants Benefit under the ESI Act, 1948 Wages Rs. 5000 p.m. If the employment injury is a fatal one, Monthly payment to his family members Rs. 4440 is apportioned among wife and children. 26 May 2023
  • 44. COMPENSATION FOR FATAL ACCIDENTS UNDER THE WC ACT, 1923 (NOW EC ACT)
  • 45. • Sec. 63. 1 (a) (b) of the Labour Code adds, “such amount as may be prescribed, whichever is more”. • In this case, when the quantum of dependant’s benefit assured by the Code has, unnecessarily been, reduced drastically, there is no reason for the people to believe that this uncertain sub-section would be used to provide matching benefits as given now under the ESI Scheme
  • 47. PERMANENT DISABLEMENT BENEFIT • Sec. 63.1 (b) of the Labour Code:
  • 48. RULE 57 (3) OF THE ESI (CENTRAL) RULES, 1950
  • 49. Permanent Disablement Benefit under the ESI Act, 1948 Wages Rs. 5000 p.m. If disabled permanently Monthly payment as per the percentage of loss of earning capacity. If it is 50%, then the monthly payment is 50% of Rs. 4440. 26 May 2023
  • 50. 63.1 (B) (I) & 63.1 (B) (II) OF THE LABOUR CODE • Quantum of Permanent Total Disablement Benefit has been reduced in the Labour Code, when compared with what is available now under the ESI Act, 1948. • When the ESI Act provides almost 90 % of the wages as the benefit for Permanent Total Disablement Benefit and Temporary Total Disablement as per Sec.57 (4) of the ESI Act, 1948, the benefit proposed to be provided under Sec. 63.1 (b) & (d) of the Code is 60 % and 50% of the benefit wage, respectively, which is far less than what is provided under the ESI Act at present
  • 51. •Such a reduction in benefit shows that the proposed Labour Code is not for improving the lot of working population.
  • 52. SEC. 4 (C) OF THE W.C. ACT, 1923
  • 54. Temporary Disablement Benefit under the ESIAct, 1948 •Wages Rs. 5000 p.m. •Any number of days x Rs.148 per day •If disbabled for 30 days 148x30=4440. 26 May 2023
  • 56. 51-B OF THE ESI ACT. (ABSENT IN THE LABOUR CODE) • 51-B. Accidents happening while acting in breach of regulations, etc. — An accident shall be deemed to arise out of and in the course of an employee’s employment not withstanding that he is at the time of the accident acting in contravention of the provisions of any law applicable to him, or of any orders given by or on behalf of his employer or that he is acting without instructions from his employer, if — • (a) the accident would have been deemed so to have arisen had the act not been done in contravention as aforesaid or without instructions from his employer, as the case may be ; and • (b) the act is done for the purpose of and in connection with the employer’s trade or business. 26 May 2023
  • 57. 51-C OF THE ESI ACT. (ABSENT IN THE LABOUR CODE) • 51-C. Accidents happening while travelling in employer’s transport. — (1) An accident happening while an employee is, with the express or implied permission of his employer, travelling as a passenger by any vehicle to or from his place of work shall, notwithstanding that he is under no obligation to his employer to travel by that vehicle, be deemed to arise out of and in the course of his employment, if — • (a)the accident would have been deemed so to have arisen had he been under such obligation ; and • (b) at the time of the accident, the vehicle — • (i) is being operated by or on behalf of his employer or some other person by whom it is provided in pursuance of arrangements made with his employer ; and • (ii) is not being operated in the ordinary course of public transport service. • (2) In this section ― vehicle ‖ includes a vessel and an aircraft 26 May 2023
  • 58. 51-D OF THE ESI ACT. (ABSENT IN THE LABOUR CODE) • 51-D. Accidents happening while meeting emergency. — An accident happening to an employee in or about any premises at which he is for the time being employed for the purpose of his employer’s trade or business shall be deemed to arise out of and in the course of his employment, if it happens while he is taking steps, on an actual or supposed emergency at those premises, to rescue, succour or protect persons who are, or are thought to be or possibly to be, injured or imperiled, or to avert or minimize serious damage to property. 26 May 2023
  • 59. 51-E OF THE ESI ACT. (ABSENT IN THE LABOUR CODE) • 51-E. Accidents happening while commuting to the place of work and vice versa. — An accident occuring to an employee while commuting from his residence to the place of employment for duty or from the place of employment to his residence after performing duty, shall be deemed to have arisen out of and in the course of employment if nexus between the circumstances, time and place in which the accident occured and the employment is established. 26 May 2023
  • 61. SICKNESS BENEFIT IN LABOUR CODE • Rate of SB, • No. of days of SB, • Conditions to become eligible for SB, • Qualification to claim SB, • All, left to be decided by Subordinate Legislation called • Sickness Benefit Scheme.
  • 62. • The Sickness Benefit is 70% of the Standard Benefit Rate under the ESI Scheme, at present.
  • 63.  Wages Rs. 5000 p.m.  Standard Benefit Rate  Divide the total wages paid during the contribution period by the number of days for which these wages were paid  30000/ 183=163.93  Sickness Benefit = Rs. 163.93x70%  One month sickness Benefit payable is = Rs. 115x30=3450 26 May 2023
  • 64. SEC. 78.1 • Recognised medical practitioner • any • Registered medical practitioner • Authorised medical practitioner
  • 65. SEC. 55 (2) OF THE ESI (CENTRAL) RULES, 1950
  • 66. REG. 103 – A OF THE ESI (GENERAL) REGULATIONS, 1950 • 103-A (1): Medical benefit after contribution ceases to be payable. • A person on becoming an insured person for the first time shall be entitled to medical benefit for a period of 3 months provided that where such a person continues for 3 months or more to be an employee of a factory or establishment to which the Act applies, he shall be entitled to medical benefit till the beginning of the corresponding benefit period. • Labour code -
  • 67. • Reg. 103-A (2) The person in respect of whom contributions have been paid in a contribution period for not less than seventy-eight days in the said contribution period shall be entitled to medical benefit till the end of the corresponding benefit period : • Labour Code: Silent
  • 68. • Reg. 103-A (2) -Provided that in case of a person who becomes an employee within the meaning of the Act, for the first time, and for whom a shorter contribution period of less than 156 days is available, he shall be entitled to medical benefit till the end of the corresponding benefit period if the contributions in respect of him were payable for not less than half the number of days available for working in such contribution period • Labour Code: Silent
  • 70. EXTENDED SICKNESS BENEFIT • Reg. 103-A (2)- Provided further that where a person suffering from any of the following diseases, before the commencement of the spell of sickness in which any such disease was diagnosed being in continuous service for a period of two years or more or where he did not have two years‟ continuous service but by virtue of relaxation granted by the authority competent in this behalf, the insured person qualifies to claim extended sickness benefit, he shall be entitled to medical benefit till the end of the relevant extended benefit period :
  • 71.
  • 72.
  • 73. Extended Sickness Benefit under the ESI Act, 1948  34 diseases  Wages Rs. 5000 p.m.  S.B= 115.00x91=10465.00  309 days x Rs. 132 per day (163.93 x 80%)  330 days x Rs. 132 per day  Total 730 days  Eligibility: On payment of contribution for 183 days in preceding four contribution periods and is eligible for SB in one period at least. 26 May 2023
  • 74. • Labour Code on such Extended Sickness Benefit:
  • 76. Enhanced sickness Benefit under the ESI Act, 1948 to promote family welfare. 7 days for men 14 days for women Benefit paid is equivalent to the wages Assuming the extra social responsibility of the State 26 May 2023
  • 77. But, the proposed Labour Code is silent on Enhanced Sickness Benefit. Apparently, because it does not want the profit earning scope of private players to be affected. Even the concept of Corporate Social Responsibility is facilitated by the framers of the Code to be given a go-by. 77
  • 79. MEDICAL BENEFIT It is admissible from the first day of insurable employment. To the Insured Person and his family members. 26 May 2023
  • 80. MEDICAL BENEFIT TO PDB CASES
  • 81. MEDICAL BENEFIT TO RETIRED PERSONS
  • 83. • The eligibility for super-specialty treatment is 3 months (with contribution paid for at least 39 days) of insurable employment for insured person (for self) and 6 months (with contribution paid for at least 78 days) of insurable employment by Insured Person for their family members. • Such tertiary care (super-speciality treatment) is provided through in-house super speciality facilities available in some of ESI Hospitals or ESI-PGIMSRs or through large no. of advanced empanelled medical institutions on referral basis through tie-up arrangements. • About 750 private hospitals in all India are now empanelled as tie- up Hospitals for ESIC.
  • 85. UNEMPLOYMENT ALLOWANCE Unique scheme for extending “cash-assistance” to the employees covered under the ESI Act (Insured Persons) while they become unemployed in certain contingencies has been introduced by the ESI Corporation with effect from 1-4-2005. According to this Scheme, cash payment will be given to the affected insured persons to the maximum of one year or till re- employed whichever is earlier. 26 May 2023
  • 86. Factors constitute to determine the insured persons as “unemployed” : 1. Permanent closure of factories / establishments; 2. Retrenchment of employees; 3. Loss of employment due to not less than 50% of permanent invalidity on account of accidents happened to the insured persons other than in the factory / establishment called as “non- employment injury” (i.e. accidents happened in other places (out-side accidents) for the insured persons’ own reasons). 26 May 2023
  • 87. 26 May 2023 The IP eligible for unemployment allowance under the Scheme shall also be entitled to medical care for himself/herself and his/her family from the ESI Dispensaries/ESI Hospitals/IMPs Clinics/ for a period of one year from the date of unemployment or till the end of benefit period corresponding to contribution period before unemployment, whichever is later. In the event of death of the IP on any date prior to the expiry of one year period of unemployment allowance, the family of the deceased IP shall continue to be entitled to medical care for 6 months as the case would have been, had the IP remained alive. Medical care under this scheme shall, however, be restricted to only for the first spell of unemployment
  • 88. Sec.24.5 of the Labour Code 26 May 2023
  • 89. OTHER BENEFITS  Funeral Expenses  Vocational Rehabilitation  Physical Rehabilitation 26 May 2023
  • 90. ESIC – The benefactor par-excellence  “The package (of benefits provided by the ESIC) can rarely be matched by private employers on their own because of the heavy costs involved – not to mention the disinclination among employers, with honorable exceptions, to operate health care systems for their workforce” – The Hindu (1.1.2005). 26/05/2023 90
  • 91. India has not done enough in social security space: ILO report  GENEVA: India has performed poorly in providing social security protection to its people until recently with "very high vulnerability" to poverty and informal labour practices in the world, according to a report released by the International Labour Office (ILO) today, 16.11.2010, Times of India.  In its first comprehensive 'World Social Security Report', the ILO has suggested that India has not done enough in the arena of social security protection, which is reckoned as the "human face of globalisation, in line with its fiscal status".
  • 92. Law Commission on W.C. Act, 1923
  • 93.
  • 95. SEC. 165.2 (LIV) & SEC. 166.2 (XXXV) • Penalties for breach or violation of rules • These two Sections result in excessive delegation to the Executive, and are, therefore, unconstitutional. • The upper limit of penalties must be provided for, beforehand in the proposed Act / Code itself. • These two sections traverse, clearly, beyond Sec. 156 and the Sixth Schedule.
  • 96. • These two sections are only enabling provisions. • But, these sections clearly show that the government is in an unseemly hurry to bring in the Labour Code without having any idea of what it really wants to achieve through the proposed Labour Code. • The government has not yet visualised what sorts of duties are going to be imposed on the employers and employees through the yet-to-be-born subordinate legislations.
  • 97. • It does not know what procedures are to be put in place to make the new machinery work. But, it wants to have penal powers for breach or violation of Rules as well as Regulations which are also going to be prepared only later. • In essence, the government has made am attempt, through the Draft Code, to get excessive delegation to it by the Parliament, in the matter of penalties, without making the Parliament know the intricacies and the consequences of such a legislation. • A legislation cannot leave it to the Executive to correct the situation which produces unexpected consequences.
  • 98. • Sec. 97 (xvii), (xvii-a) and (xvii-b) of the ESI Act, 1948 provide for prescribing penalties through subordinate legislations with clear-cut limits. • In regard to the Damages, which is also a measure of penalty, Reg. 31-C of the ESI (General) Regulations is only reducing the effect of the penalty permitted to be imposed by the Parliament under Sec. 85-B of the ESI Act, 1948. • The maximum limit is, thus, already, provided for by the Parliament, in Sec.84 and 85 of the ESI Act, 1948 itself, safeguarding thus the people from the Executive. The Employees’ Provident Fund Act, 1952 also does not confer penal power through subordinate legislations, vide its Sec. 21.
  • 99. • But, the proposed Sec. 165.2 (liv) and Sec.166.2 (xxxv) do permit the Executive to invent new areas of duties and responsibilities for the employers and the workers and to impose any kind of penalty on them. • The proposed Sec. 156 does not bar the Executive from doing so.
  • 100. • The Supreme Court has said, “Unlike Parliamentary legislation which is publicly made, delegated legislation or subordinate legislation is often made unobtrusively in the chambers of a minister, a secretary to the Governor or other official dignitary.” • (ITC Bhadrachalam Paperboards Vs. Mandal Revenue Officer 1996 (6) SCC 634 and • Harla Vs. State of Rajasthan AIR 1951 SC 467 and • B.K. Srinivasan Vs. State of Karnataka AIR 1987 SC 1059).
  • 101. • “Blanket discretionary power” has been held to be unconstitutional in ( State of Bihar Vs. K.K. Mishra 1969 3 SCC 337 and Khwaja Ahmed Abbas Vs. Union of India 1970 2 SCC 780); • “Unguided discretionary power” has been held to be unreasonable in (Himat Lala K Shah Vs. Commissioner of Police 1973 1 SCC 227);
  • 102. • “Wide discretionary power” (State of Madras Vs. V.G. Row 1952 AIR SC 1976) is unconstitutional because it allows the administrative authority to exercise this discretion on subjective satisfaction without permitting the grounds to be judicially tested. • “Wide discretion without procedural safeguards” had been held as unconstitutional in State of M.P Vs. Bharat Singh AIR 1967 SC 1170).
  • 103. • It is not proper for the government to acquire unbridled power of imposing penalties on the employers, employees and the members of the public who would be treated as defaulters of non-compliance with various provisions of the yet-to-be-born subordinate legislations. It is possible and appropriate to bring in all the subordinate legislations also together with this Code so that there would be no need for a carte-blanche in penal power to the authorities through Sec. 165.2 (liv) and Sec.166.2 (xxxv), without the knowledge of the Parliament.
  • 104. • It is possible to bring in, at the initial stage itself, a comprehensive Code covering all aspects of Social Security, as this is not a legislation in a field where there is no other law in force. The proposed Labour Code, is intended to replace the existing Social Security enactments and dismantle the established structure of those social security organisations.
  • 105. • It is, therefore, essential for the Executive to place a comprehensive Bill covering all aspects of the subject-matter, including the manner in which the delivery machinery would function, so that the area of defaults and the quantum of penalty can be identified and the approval of Parliament obtained beforehand, without any need for imposing new penalties in new areas not covered by the Code / Act.
  • 107. ESIC • The protective umbrella for the employers • Provides means for the economic growth of the nation • The safety net for the employees • Provides proper living conditions for the work- force 26 May 2023
  • 108. The scheme was conceived originally by employers. They took concerted action for formal legislative protection by nations. 26 May 2023
  • 109. Is the ESI Act, 1948 a compulsory provision? 26 May 2023
  • 110. The ESI Act, 1948 is not a compulsory provision for any factory or establishment There are provisions for exemption. 26 May 2023
  • 111. An employer can rightly demand exemption, if the benefits provided by him to his employees are substantially similar or superior to those provided for in the ESI Act, 1948. 26 May 2023
  • 112. This condition must be really fulfilled. The assertion will be verified with reference to the past records, in spite of the exemption already given. 26 May 2023
  • 113. SEC. 87 OF THE ESI ACT, 1948 • 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 : • Provided further that an application for renewal shall be made three months before the date of expiry of the exemption period and a decision on the same shall be taken by the appropriate Government within two months of receipt of such application.
  • 114. SEC. 88 OF THE ESI ACT, 1948 • 88. Exemption of persons or class of persons. — • The appropriate Government may, by notification in the Official Gazette and subject to such conditions as it may deem fit to impose, exempt any person or class of persons employed in any factory or establishment or class of factories or establishments to which this Act applies from the operation of the Act.
  • 115. SEC. 89 OF THE ESI ACT, 1948 • 89. Corporation to make representation. — • No exemption shall be granted or renewed under section 87 or Section 88, unless a reasonable opportunity has been given to the Corporation to make any representation it may wish to make in regard to the proposal and such representation has been considered by the appropriate Government.
  • 116. • There is no provision analogous to Sec. 89 of the ESI Act in the proposed Labour Code, necessitating consultation with the S.S. Organisation before granting exemption. • Means, the S S Organisation is not the monitoring agency of the Social Security net stated to be provided to the working population. • Employers used to be challenged with Sec. 89 and 90. • Sec. 89 ensures that the ESIC carries out the Constitutional mandate as per Art. 41. • Reasonable opportunity was there for the ESIC to represent.
  • 117. SEC. 90 OF THE ESI ACT, 1948 • 90. Exemption of factories or establishments belonging to Government or any local authority. — The appropriate Government may, after consultation with the Corporation, by notification in the Official Gazette and subject to such conditions as may be specified in the notification, exempt any factory or establishment belonging to any local authority, from the operation of this Act] if the employees in any such factory, or establishment are otherwise in receipt of benefits substantially similar or superior to the benefits provided under this Act.
  • 118. SEC. 91 OF THE ESI ACT, 1948 • 91. Exemption from one or more provisions of the Act. — The appropriate Government may, with the consent of the Corporation, by notification in the Official Gazette, exempt any employees or class of employees in any factory or establishment or class of factories or establishments from one or more of the provisions relating to the benefits provided under this Act. • Also Sec. 1 (4).
  • 119. SEC. 17 (2) OF THE EPF ACT, 1952 • (a) any establishment to which this Act applies, if, in the opinion of the appropriate Government, the rules of its provident fund with respect to the rates of contribution are not less favourable than those specified in section 6 and the employees are also in enjoyment of other provident fund benefits which on the whole are not less favourable to the employees than the benefits provided under this Act or any Scheme • in relation to the employees in any other establishment of a similar character;
  • 120. • (b) any establishment if the employees of such establishment are in enjoyment of benefits in the nature of provident fund, pension or gratuity and the appropriate Government is of opinion that such benefits, separately or jointly, are on the whole not less favourable to such employees than the benefits provided under this Act or any Scheme • in relation to employees in any other establishment of a similar character.
  • 121. • (IC) The appropriate Government may, by notification in the Official Gazette, and subject to the condition on the pattern of investment of pension fund and such other conditions as may be specified therein, exempt any establishment or class of establishments from the operation of the Pension Scheme if the employees of such establishment or class of establishments are either members of any other pension scheme or propose to be members of such pension scheme, where the pensionary benefits are at par or more favourable than the Pension Scheme under this Act
  • 122. • (2) Any Scheme may make provision for exemption of any person or class of persons employed in any establishment to which the Scheme applies from the operation of all or any of the provisions of the Scheme, if such person or class of persons is entitled to benefits in the nature of provident fund, gratuity or old age pension and such benefits, separately or jointly, are on the whole not less favourable than the benefits provided under this Act or the Scheme:
  • 123. • (2A) The Central Provident Fund Commissioner may, if requested so to do by the employer, by notification in the Official Gazette, and subject to such conditions as may be specified in the notification, exempt, whether prospectively or retrospectively, any establishment from the operation of all or any of the provisions of the Insurance Scheme, if he is satisfied that the employees of such establishment are, without making any separate contribution or payment of premium, in enjoyment of benefits in the nature of life insurance, whether linked to their deposits in provident fund or not, and such benefits are more favourable to such employees than the benefits admissible under the Insurance Scheme.
  • 124. • (2B) Without prejudice to the provisions of sub- section 2A, the Insurance Scheme may provide for the exemption of any person or class of persons employed in any establishment and covered by that scheme from the operation of all or any of the provisions thereof, if the benefits in the nature of life insurance admissible to such person or class of persons are more favourable than the benefits provided under the Insurance Scheme.
  • 125. SEC. 94. 1 (H) OF THE DRAFT LABOUR CODE • The authorities who prepared the draft Code had taken a conscious, deliberate and calculated decision to drop the word “substantially” before the word “similar” appearing therein.
  • 126. ‘SUBSTANTIAL’ - LEFT OUT . WHY? • The term “substantial” can have a qualitative meaning and be defined as “important” or “essential”, and can have a quantitative meaning and be defined as “considerable in quantity” or “significantly great” in amount. This word precludes invoking the ‘de minimis’ principle. (Page 812 – Concise Law Dictionary – Wadhwa Publication). • Yet, such an important word has, consciously, been left out in Sec. 94 of the Draft Labour Code in ‘Part L’ which deals with exemption.
  • 128. SUBSIDY – SEC. 22.6 • Enabling provision for providing “subsidy” to “the employer” under Sec. 22.6 (b) from the Welfare Funds, by the State Board and in aid of any scheme; • Also to give subsidy to the employer to provide for “defraying the cost” of “provision of cost of transportation to and from work” for the employees under Sec. 22.6 (d) (vi).
  • 129. • Contrast this with Sec. 51 – C of the ESI Act.
  • 130. • 51-C. Accidents happening while travelling in employer’s transport. — • (1) An accident happening while an employee is, with the express or implied permission of his employer, travelling as a passenger by any vehicle to or from his place of work shall, notwithstanding that he is under no obligation to his employer to travel by that vehicle, be deemed to arise out of and in the course of his employment, if — (a) the accident would have been deemed so to have arisen had he been under such obligation ; and (b) at the time of the accident, the vehicle — • (i) is being operated by or on behalf of his employer or some other person by whom it is provided in pursuance of arrangements made with his employer ; and • (ii) is not being operated in the ordinary course of public transport service. (2); In this section ― vehicle includes a vessel and an aircraft.
  • 131. PURPOSE OF SEC. 22.6 •To provide lump sum payment by the State Governments to the businessmen who act as ‘Intermediate Agencies’ ?
  • 133. C.K. Allen Carleton Kemp Allen- Law and Order - (1945) – Law in the making (1927) Subordinate legislations provide for convenience, flexibility and efficiency with respect to the delegation of such powers. But, Allen says that all these arguments regarding convenience, flexibility and efficiency are “sound arguments for delegation within due limits, the kind, in fact, which has always been recognized as a practical and necessary part of our governmental system. But they become unsound and dangerous if they are used to justify the indefinite extension of executive powers. Speed and efficiency may be bought at too high a price, and indeed we should have learned from many examples that the State which makes efficiency its highest god is very apt to become an all-devouring monster”. 133
  • 135. RULE MAKING POWERS OF THE CENTRAL GOVERNMENTS • Sec. 165
  • 136. RULE MAKING POWERS OF THE STATE GOVERNMENTS
  • 137. RULE MAKING POWERS OF THE STATE GOVERNMENTS • Powers of the State Governments must be listed in an independent Section just like Sec. 165 which deals with the Powers of Central Government to make Rules. • The principles of Legislative Drafting do not permit the “Rule-making power of the State Governments” to be shown in the sub-section of Sec. 165 here. • Secondly, all the areas with reference to which powers must be conferred on the State Government must be enumerated, in a thoroughly exhaustive manner in the Code / Act itself, to facilitate enactment of Subordinate Legislation in all respects addressing all the nitty-gritties of monitoring and delivery mechanisms.
  • 139. REGULATIONS • National Council is empowered to make Regulations. Sec. 166. • Details not known. • Asked under the RTI Act to supply the copies of the proposed Regulations and the Schemes referred to in Sec. 24 of the said Draft Labour Code on Social Security & Welfare.
  • 141. BYE LAWS • 2.59 : “Bye –Laws ” means the bye –laws framed by the Central Board. • Central Board is competent to make Bye-laws (by-laws). Sec. 166.3 & 166.4. • Both terms used in the code which is improper. • Details asked for under the RTI Act.
  • 145. 2.68 •“intermediate agency” means any Fund manager agency, Point of presence Agency, Service delivery Agency, Benefit disbursement Agency or Recordkeeping Agency licensed under Section 88(1) 145
  • 146. IMMEDIATE AGENCIES • It is apparent, from Sec. 88 of the Draft Code, that the persons who were imaginative enough to bring in so many agencies must have visualized the future scenario and recorded how such agencies would function in practice. • But, they have not made it public. • This Section is going to be used for virtual privatisation of the Social Security.
  • 147.
  • 148. • (a) Fund Manager Agency, • (b) Point of Presence Agency, • (c) Service Delivery Agency, • (d) Benefit Disbursement Agency, • (e) Record Keeping Agency and • (f) Facilitation Agencies.
  • 149. SEC. 88.2 • The intermediate agency, for grant of license, shall satisfy the eligibility norms as may be stipulated, including minimum capital requirement, past track record, ability to provide guaranteed returns, cost and fees, geographical reach, customer base, information technology capability, human resources and such other matters as may be stipulated
  • 150. SEC 166.2 – POWER OF THE NATIONAL COUNCIL TO MAKE REGULATIONS • (xxiii) duties and functions of intermediate agencies • (xxiv) eligibility norms for grant of license to an intermediate agency • (xxv) form and manner of making application for license of intermediate • agency • (xxvi) manner of cancellation of license of intermediate agency
  • 151. • Are these Intermediate Agencies under Sec. 88.1 amenable to the provisions of the RTI Act? • Are they public authorities? • Can the ‘Scheme Members’ demand information from them and inspect their records as per the RTI Act? • This is the most important question to be answered by the Ministry.
  • 152. SEC. 115 OF THE CODE DOES NOT REFER TO THOSE AGENCIES
  • 153. AGENCIES • “Intermediate Agencies” and “Agencies” • These two phrases are interchanged at different places. • This is not a proper course of legislative writing.
  • 154.  The Public must be informed of the concept and intricacies of these Agencies-system, and the contents of the Schemes proposed on all the Social Security benefits.  Because, that alone would provide a holistic view of the ‘reforms’ proposed.  That alone would make the people know about the real and consequential effect of the proposed Code. 154
  • 155.  Sec. 88.1 of the Code says that the “Director General may, by granting a License under this Code, permit any organization or person to act as an intermediate agency for all or any of the purposes” mentioned against each of the six agencies enumerated therein. 155
  • 156.  Sec, 88.3 of the Code says that “an intermediate agency shall function in accordance with the terms of its License and the Regulations”.  Sec. 88.4 implies that the terms and conditions of such a license will be “in accordance with the provisions of this Code and the Regulations”.  Sec. 88. 5 says that the application for such a license will be in a specified form. 156
  • 160. CENTRAL SOCIAL SECURITY SERVICE • Sec. 112.1 – left blank.
  • 162. • Sec. 88.1 of the Code says that the “Director General may, by granting a License under this Code, permit any organization or person to act as an intermediate agency for all or any of the purposes” mentioned against each of the six agencies enumerated therein. Those agencies are: (a) Fund Manager Agency, (b) Point of Presence Agency, (c) Service Delivery Agency, (d) Benefit Disbursement Agency, (e) Record Keeping Agency and (f) Facilitation Agencies.
  • 163. LICENSE •Asked under the RTI Act to supply the copies of the format of the proposed License (containing the Terms and conditions imposed by the Government on the agencies) referred to in Sec. 88 and 89 of the said Draft Labour Code on Social Security & Welfare;
  • 164. RETURNS TO BE FILED. RECORDS TO BE MAINTAINED ONLINE PAYMENT SYSTEM 26 May 2023
  • 165. 166.4 Central Board may provide for matters relating or incidental to— • (i) Form of Registers, records, books of accounts and other documents required to be maintained by employers, establishments, contractors, works contactors, landlords, owner of a mine, producer of a film, self- employed units, person deducting contribution at source and intermediate agencies; and manner in which such records shall be maintained. • (ii) form and manner in which application for registration (for workers or establishments) shall be made • (iii) form and manner in which application for cancellation, deactivation or reactivation (for workers or establishments, as applicable) shall be made 26 May 2023
  • 166. TERMS NOT DEFINED 26 May 2023
  • 167. • Commission and piece rare worker: Sec. 2.21 • Monthly income: Sec. 2.84. • Part-time worker: Sec. 2.96 (Definition is not clear. Some words are, obviously, missing between the word ‘government’ and the phrase ‘of work’. ) • Sec. 74.9 contains question marks, indicating incomplete spade work, before posting in public domain calling for the opinion of the public.
  • 168.
  • 169.
  • 170.
  • 171. ????
  • 173. The Registrar, Thiyagarajar College of Engineering, Madurai Vs. The Registra, Tamilnadu Information Commission – 30.04.2013  Hon’ble High Court of Madras has observed, “Public Interest means an act beneficial to the general public.  Means of concern or advantage to the public, should be the test.  Public interest in relation to public administration, includes honest discharge of services of those engaged in public duty.  To ensure proper discharge of public functions and the duties, and for the purpose of maintaining transparency, it is always open to a person interested to seek for information under the Right to Information Act, 2005” 26 May 2023
  • 175. 175
  • 177. 177
  • 179. 179
  • 180. Just-in-time-scheduling • Just-in-time scheduling is another part of America’s new “flexible” economy - Robert Reich 26 May 2023
  • 182. • “Organisations must have the flexibility to adjust the number of this workforce based on economic efficiency” - Second National Commission of Labour 26 May 2023
  • 184. The purpose of inspection divisions of the ESI Corporation is to ensure that no person who should be provided security-net under the ESI Act, 1948 is left uncovered and that no amount of wages paid to him is left by the employer for calculating the amount of contribution. 184
  • 186. 26 May 2023 Germany Vs. India Otto von Bismarck
  • 187. Choice is ours •Social Security or •Social unrest 26 May 2023
  • 189. The Standard Vacuum Refining Co.of India Ltd.Vs. Workmen Contract labour should not be employed where: (a) The work is perennial and must go on from day to day; (b) The work is incidental to and necessary for the work of the factory; (c) The work is sufficient to employ considerable number of whole time workmen; and (d) The work is being done in most concerns through regular workmen. 1960 -SC 189
  • 190. CLRA ACT, STATEMENT OF OBJECTS AND REASONS 26 May 2023
  • 191. Why has Japan succeeded? Prof. Michio Morishima emphasises the importance of the role played in the creation of Japanese capitalism by ethical doctrines as transformed under Japanese conditions , especially the Japanese Confucian tradition of complete loyalty to the firm and to the State.
  • 192.
  • 193.
  • 194. Tactics to make mincemeat of Labour Laws  The Executive cannot bring in a truncated version of the proposed system in the form of Code and ask the MPs to vote. But, that, exactly, is what the bureaucracy has, exactly, done through this Draft Labour Code. Sec. 24.5 of the Code enumerates the nomenclature of the benefits that would be made available to the workforce. 194
  • 195.  But, the quantum of benefits and the nature of machinery through which such benefits would be provided have not been made known.  These issues have been kept reserved for the Executive to make Subordinate Legislations later. 195
  • 196.  ESI Corporation is not a business organisation preparing profit and loss account. (Contrast – Sec. 165 (2) (xxxvi) regarding “Conditions under which losses may be written off”).  It is a service organisation preparing income and expenditure statement.  But, the very wordings of Sections 2.58, 2.68, 2.101, 2.109, 2.123 and Sec. 88. show that the intention behind the Code is to handover the operative side of the scheme to private businessmen who enter into the field with profit motive. 196
  • 197. 2.58  "fund management agency” means an agency licensed under section 88(1)) to perform functions of professional management, investment and custody of accumulations in a social security fund or scheme fund. 197
  • 198. 2.68  “intermediate agency” means any Fund manager agency, Point of presence Agency, Service delivery Agency, Benefit disbursement Agency or Recordkeeping Agency licensed under Section 88(1) 198
  • 199. 2.101  “Point of presence Agency” means an agency licensed under section 88(1) for receiving contributions and instructions and transmitting them to the Trustee Bank or Record keeping agency; 199
  • 200. 2.109  "Record keeping agency” means an agency licensed under section 88(1) to perform functions of record-keeping, accounting, administration and customer service for members of any scheme. 200
  • 201. 2.123  “service delivery agency” means an agency licensed under section 88(1) for the purposes of providing services, medical or otherwise, and other non-financial benefits under any Schemes. 201
  • 202. 88.2 – 88.6 - Privatisation 202
  • 203. 203
  • 204. What was the position when there was no social security system and no ESI Corporation? 26 May 2023
  • 206. Other indicators of privatisation 206
  • 207. Samuel Gompers President of the American Federation of Labor between 1886 and 1924  "When a dominating class wants to keep a subject class under its control, what better way to distract it than to keep it fighting amongst itself. If a subject class is kept busy fighting each other as individuals and trying to gain small advantages or favouritism over each other, it will be all the easier to keep them in check. A subject class which is divided on the basis of arbitrary and superficial differences such as sex, race or nationality will always remain subject” 26 May 2023 The Constitution of the ILO was drafted between January and April, 1919, by the Labour Commission set up by the Peace Conference, which first met in Paris and then in Versailles. The Commission was chaired by Samuel Gompers.
  • 209. Bangalore April 18, 2016 26 May 2023
  • 212.  “According to Jayaram K.R. from the Garment and Textile Workers’ Union, the protest was against the union government’s amendment of the Act. As per the new amendment, people will be able to withdraw only their (employee’s) contribution to their provident fund accounts. They will be able to withdraw the employer’s contribution only after they are 58-years- old.  Stating that this was “anti-workers”, Mr. Jayaram said that if there was no contribution to the provident fund, the workers will be entitled to only three years’ of interest on their employer’s contribution.  “The main contention is that many workers of the unorganised sectors are not sure of being employed till they are 58-years-old. Workers, who are over 40 years, are unsure, as they may not be able to find suitable jobs,” he said.” 26 May 2023
  • 215. The basic need for all human beings Security in life on all fronts 26 May 2023
  • 216. Second National Labour Commission Report 216
  • 217. 217
  • 218. Contract Labour should not be for monetary gain 218
  • 219. Work Culture Vs. Worker’s culture 219
  • 220. Leisure is a basic necessity 220
  • 221. First National Labour Commission was for 40 hours week 221
  • 222. Less over time and spread over 222
  • 223. Earlier law should prevail 223
  • 225. • “Law is the great civilizing machinery. • It liberates the desire to build and subdues the desire to destroy. • And if war can tear us apart, Law can unite us – out of fear, or love or reason, or all three. • Law is the greatest human invention. All the rest, give man mastery over his world. Law gives him mastery over himself”. Lyndon B.Johnson, TIME September 24, 1965
  • 226. Is the role of the State necessary in the scheme of things? 26 May 2023
  • 227. Assures proper and corruption-free administration to achieve the purpose of the Scheme. 26 May 2023
  • 228. “Health is one area in which the public sector consistently does a better job than the private sector at controlling costs” -Paul Krugman Nobel Prize winner (The Hindu – 14.6.2011) 228
  • 232. The wealthiest nations do not have the healthiest people; instead, it is countries with the smallest economic gap between the rich and poor. (Mark Bourrie – Inter Press Service -23.7.1999). 26 May 2023
  • 235. What should be objective of a nation? • Top in the list of GDP. • Top in the list of Percapita income. • Top in the list of possession of nuclear arms. • Top in the list of number of billionaires. • Top in the list of Human Development Index. • Top In the lsit of Global Prosperity Index. 26 May 2023
  • 236. Human Development Index • Top Scandinavian countries. • India 130 /188 • Human development is defined as the process of enlarging people's freedoms and opportunities and improving their well-being. Human development is about the real freedom ordinary people have to decide who to be, what to do and how to live. 26 May 2023
  • 237. Global Prosperity Index • India ranked 99 out of 142 countries on a prosperity index. • The rankings, produced by a London-based think tank, the Legatum Institute, gauge the prosperity of a nation by combining economic indicators, including gross domestic product, with dozens of other measures of wellbeing, from access to education and health to the living environment for ethnic minorities. • The index is based on the logic that “prosperity is more than just the accumulation of material wealth”. • In this year’s rankings, Norway topped the list for the seventh consecutive year, followed by Switzerland, Denmark and New Zealand. 26 May 2023
  • 239. Has to be run only by Governments The ESI Scheme in India which collects only 1.75% of wages as Employees Contribution is still viable for almost 6 decades without any assistance from Central Government, only because it is compulsory and also because the field of dispersal of benefit load is larger. This is in sharp contrast to the position obtaining in smaller countries where the employees contribution is much more, ranging from 27 to 73%. 26 May 2023
  • 240. High Court of Madras [Chandramathi Vs. ESIC – 2003 (4) LLN. 1143]  “The object of the legislation is to protect the weaker section with a view to do social justice” 26 May 2023
  • 241. High Court of Madras [C. Indira Vs. Senthil & Co – 2009 (2) LLN 302]  “The object of the Act is to provide certain benefits to the employees or dependants in case of sickness, maternity and employment injury, etc., to give effect to Art. 1 of the Universal Declaration of Human Rights, 1948, which assures human sensitivity of moral responsibility of every State that all human beings are born free and equal in dignity and rights” . 26 May 2023
  • 243. Supreme Court of India Samatha Vs. State of Andhra Pradesh (1997) 8 SCC 191 (Para 75)  “The core constitutional objective of ‘social and economic democracy’ in other words, just social order, cannot be established without removing the inequalities in income and making endeavour to eliminate inequalities in status through the rule of law. The mandate for social and economic retransformation requires that the material resources or their ownership and control should be so distributed as to subserve the common good.  Contd. 26 May 2023
  • 244. Supreme Court of India Samatha Vs. State of Andhra Pradesh (1997) 8 SCC 191 (Para 75 Contd.)  …. A new social order, therefore, would emerge, out of the old unequal or hierarchical social order. The legislative or executive measures, therefore, should be necessary for the reconstruction of the unequal social order by corrective and distributive justice through the rule of law” 26 May 2023
  • 245. Universal Declaration of Human Rights • Preamble • Whereas recognition of the inherent dignity and of the equal and inalienable rights of all members of the human family is the foundation of freedom, justice and peace in the world, • Whereas disregard and contempt for human rights have resulted in barbarous acts which have outraged the conscience of mankind, and the advent of a world in which human beings shall enjoy freedom of speech and belief and freedom from fear and want has been proclaimed as the highest aspiration of the common people, • Whereas it is essential, if man is not to be compelled to have recourse, as a last resort, to rebellion against tyranny and oppression, that human rights should be protected by the rule of law, • Whereas it is essential to promote the development of friendly relations between nations, • Whereas the peoples of the United Nations have in the Charter reaffirmed their faith in fundamental human rights, in the dignity and worth of the human person and in the equal rights of men and women and have determined to promote social progress and better standards of life in larger freedom, • Whereas Member States have pledged themselves to achieve, in co-operation with the United Nations, the promotion of universal respect for and observance of human rights and fundamental freedoms, • Whereas a common understanding of these rights and freedoms is of the greatest importance for the full realization of this pledge, • Now, Therefore THE GENERAL ASSEMBLY proclaims THIS UNIVERSAL DECLARATION OF HUMAN RIGHTS as a common standard of achievement for all peoples and all nations, to the end that every individual and every organ of society, keeping this Declaration constantly in mind, shall strive by teaching and education to promote respect for these rights and freedoms and by progressive measures, national and international, to secure their universal and effective recognition and observance, both among the peoples of Member States themselves and among the peoples of territories under their jurisdiction. 26 May 2023
  • 246. • Whereas recognition of the inherent dignity and of the equal and inalienable rights of all members of the human family is the foundation of freedom, justice and peace in the world, • Whereas disregard and contempt for human rights have resulted in barbarous acts which have outraged the conscience of mankind, and the advent of a world in which human beings shall enjoy freedom of speech and belief and freedom from fear and want has been proclaimed as the highest aspiration of the common people, • Whereas it is essential, if man is not to be compelled to have recourse, as a last resort, to rebellion against tyranny and oppression, that human rights should be protected by the rule of law, 26 May 2023
  • 247. Universal Declaration of Human Rights All human beings are born free and equal in dignity and rights. They are endowed with reason and conscience and should act towards one another in a spirit of brotherhood. • -Article 1 26 May 2023
  • 248. Universal Declaration of Human Rights Everyone, as a member of society, has the right to social security • -Article 22 26 May 2023
  • 249. 26 May 2023 Consequently, the ESI Act, 1948 is born as part of the first package of labour welfare measures immediately after Indian independence.
  • 250. Fundamental Principles 1. The proposed scheme must not be too ambitious in the beginning; 2. It must be simple, clear and straightforward, 3. It must be financially sound, economical in working and actuarially balanced; 4. It must minimize disputes and litigation; 5. It must be workable in the peculiar circumstances of Indian labour and industry; 26 May 2023
  • 251. Courtesy: Times of India 26 May 2023
  • 252. Fundamental Principles (Contd.) 6. It must be in conformity with international labour conventions; 7. It must not be saddled with financial responsibilities which belong to other measures of social security and finally 8. It must be sufficiently flexible. 26 May 2023
  • 253. Not to be saddled  For the success of the ESI Scheme, Prof. Adarkar wanted certain extra measures to be taken. His stand was that the ESI Scheme should not be “saddled with burdens legitimately belonging to other branches of social insurance”. Therefore, while formulating the ESI Scheme, he made four assumptions for its success. 26 May 2023
  • 254. Four Assumptions  (a) Adoption of a scheme for Unemployment Insurance and creation of new employments in the post war period,  (b) Establishment of a scheme of Old Age Pension,  (c) Adoption of certain pre-medical measures like education in health and improvement in environment hygiene besides regulation of wages and rigorous enforcement of factory laws and, finally,  (d) National Health Drive. 26 May 2023
  • 255. Art. 41 of the Constitution The State shall, within the limits of its economic capacity and development, make effective provision for securing public assistance in case of unemployment, old-age, sickness, disablement and other cases of undeserved wants. 26 May 2023
  • 256. Public Assistance a Constitutional responsibility  Private Assistance? 26 May 2023
  • 257.  What is Art. 42?  Why is it there in the Directive Principles? 26 May 2023
  • 258. 26 May 2023 The social security system of a country is the symbol of civilisation. The extent of its success depends upon the degree of maturity of the society as a whole.
  • 259. Robert Owen  “What ideas individuals may attach to the term "Millennium" I know not; but I know that society may be formed so as to exist without crime, without poverty, with health greatly improved, with little, if any misery, and with intelligence and happiness increased a hundredfold; and no obstacle whatsoever intervenes at this moment except ignorance to prevent such a state of society from becoming universal.”  - Robert Owen, 1.1.1816 when he opened the Institute for the Formation of Character. 26 May 2023
  • 261. Civil Service, Political set up & Moral standards of the society 261  Responsibility of thinkers, leaders and individuals.
  • 262. சான ் ற ாரும் உண ் டுக ால்? 262
  • 263. There is a definite role for You !

Editor's Notes

  1. No quantum of benefits or period of benefit.
  2. Role of thinkers in society. Cannibals in Africa. Responsibilities of the Police increases. She did not ask whether there was police. She asked whether there were learned.