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The Employees Compensation Act, 1923 – Brief Notes

The Employees Compensation Act, 1923 provides social security to the employees who have had an accident during the course of employment which either leads to their Partial or Total Disablement in hazardous working conditions. In the case of the accident resulting in the death of the employee, the compensation is payable to the dependants of the employee. There are two types of Disablement-

a) Partial Disablement

Which can be further classified as

  • ‘Temporary Partial Disablement’-: Where the disablement reduces the earning capacity of the employee in the employment he was engaged in during the time of the accident
  • ‘Total Partial Disablement’-: Where the disablement reduces for all time the earning capacity of the employee in every employment which he was capable of undertaking at the time

[Suggested Read: Objectives of Legal Aid in India]

b) Total Disablement: Where the Disablement incapacitates the employee of all work that he capable of performing at the time of the accident.

  • This Act provides compensation by an employer for all physical injury arising during employment which causes disablement and for an occupational disease that is bound to be acquired due to the nature of work.
  • The employer is not liable to pay any compensation if disablement due to injury doesn't last more than three days or injury is caused directly due to the worker being drunk or on drugs at the time, worker disobeyed a safety rule or order, and removed or disregarded any safety guard.
  • The compensation is calculated by considering factors like the nature of injury or disability, the average salary and age of the injured employee.
  • The claim for compensation must be made within an appropriate period by giving notice of the accident to the employer, the agreement over compensation must be reached without fraud or undue influence, and compensation is to be paid immediately.
  • After the employee and employer have reached an agreement over the amount of settlement to be paid, the agreement needs to be registered with the commissioner and is to be verified and recorded.

Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 – Brief Notes

In the case of Vishaka V. State of Rajasthan, the Supreme Court held that harassment of women at the workplace was violative of Article 19 (1) (g), Article 21 and Article 14 of the constitution and the court gave guidelines which were to be treated as law until an Act was made.

It is applicable to establishments where 10 or more employees were employed.

Though there were these guidelines which were available according to the International Labour Organisation these were not implemented and hence, Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 was enacted which superseded the Vishakha Guidelines.

It has a very wide application and shall be applied to women who are employed in the organised, the unorganised, public or private sector also includes domestic workers and covers clients, customers as well. However, this Act does not cover women employed in the Armed forces.

[Suggested Read: Objectives of Legal Aid in India]

This Act includes all women employed in the workplace, visiting it or dwelling on it. The employment can be for remuneration or voluntary, can be regular or ad hoc, direct or through an agent, apprenticeships, contractual or probationary.

The place of employment under this act include government offices, companies, corporations or co-operatives, private sector establishments, NGOs, hospitals, transportation provided by the employer, unorganized sector establishments etc.

Sexual harassment includes physical contact, inappropriate advances, ordering sexual favours, showing pornography, stalking, humiliating, any verbal or non-verbal inappropriate and sexual remark etc.

  • Under this act, every employer must constitute an Internal Complaint committee that is open to receiving such reports from aggrieved women.
  • Another provision states that there must be a Local Complaint Committee in every district that may entertain all complaints from establishments that do not have internal committees due to having less than 10 employees.

[Suggested Read: Concept of legal aid in India]

The Industrial Establishment (N&FH) Act, 1963 – Brief Notes

The State Act for Karnataka is ‘The Karnataka Industrial Establishments (National and Festival Holidays) Act, 1963. As per the request of the Government to enforce observance with wage to the National and Festival Holidays, this Legislation was enacted.

Two National holidays have to be given to the employees on the 26th of January and 15th of August, which will be paid holidays for employees who are in continuous service for ninety days immediately preceding the date of the holiday. 

1st of May has also been declared as a paid holiday for establishments in Karnataka other than establishments controlled by the Government of India. Paid holidays are also provided during general or bye-elections.

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Under this Act, the employers and employees are allowed to choose from the list of festivals the paid holidays.

  • The employee is entitled to payment of wages for each holiday available to him under this act, regardless of what their contract might state. 
  • If the employee works on a holiday, he is entitled to double the normal wage or at his option, he can obtain a substitute holiday with pay on some other day. 
  • Section 11 of the Act provides that the employee is entitled to any benefits provided to him under law or his contract that may be more favourable to him than those granted by this Act and those shall not be affected by this Act. 
  • The inspector has the power to enter the establishments at any reasonable time to carry out an examination of the area and the documents, registers, records, any evidence he sees fit. 
  • If the employer is found guilty of obstructing the work of the inspector, he is liable to pay a fine up to Rs. 125 for the first offence and up to Rs. 250 for subsequent offences. 

[Suggested Read: District, State and National Legal Service Authorities In India]

The Equal Remuneration Act, 1976 – Brief Notes

The Equal Remuneration Act, 1976 extends to the whole of India. The main object of the Act to ensure that equal remuneration is given to men and women workers for the same work or work of similar nature without discrimination and also in the process of recruitment of workers for the same or a work of similar nature no discrimination is made between employees. However, no provision is made for Transgenders in this Act. 

According to Section 3 of the Act, the provisions of this Act shall have an overriding effect to any laws which are inconsistent with the Act.

According to Section 7, the claims arising out of non- payment of wages at equal rates to men and women doing the same work shall be addressed by an officer who is not below the rank of a Labour officer. He shall be appointed by the Appropriate Government.

[Suggested Read: Access to Justice]

In addition to remuneration, the employer cannot be discriminatory against women while recruiting for the same or similar work unless employment in such work is prohibited or restricted for women by law. 

  • The provisions of this act do not override or affect the reservation or priority given to Scheduled castes,  scheduled tribes, Ex-servicemen etc. 
  • According to Rule 6, every employer has to maintain a register and other documents in regards to all employees.
  • For minor infractions under this law such as failure to maintain a register of employees, produce the register, refusing to give evidence and denying any worker of a servant from giving evidence, the employer is liable to be fined up to Rs. 1000.
  • For major infractions such as discrimination in recruitment, giving unequal pay for same kind and amount of work or any other discrimination between women and men workers prohibited by the Act, the employer is liable to be fined up to Rs. 5000.

[Suggested Read: Labour Rights]

The Payment of Gratuity Act, 1972 – Brief Notes

Gratuity is the lump sum amount given to an employee as social security who has worked in an establishment for a minimum of five years, in case of retirement or superannuation. 

As per the Payment of Gratuity (Amendment) Act, 2010 the ceiling of gratuity was increased from Rs.3.5 Lakhs to Rs.10 lacs and according to Payment of Gratuity (Amendment) Act, 2018 which was brought into force on 29th March 2018 the ceiling limit is Rs.20 Lacs as notified by the central Government. This is due to the implementation of the 7th Central Pay Commission. However, in the amended Act, the ceiling amount can be notified by the Central Government from time to time so that the Act does not need constant amendment. 

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Also, the calculation of Gratuity in case of maternity leave was initially 12 weeks but now the period will be notified by the government. It is applicable to establishments which employ 10 or more people.

  • An employee is also entitled to gratuity in case of death or disablement caused by disease or injury. 
  • Gratuity is to be paid to the employee or to the nominee of the employee in case of death. If no nominee has been declared and a minor is to be assigned nomination, then the authority will deposit the money in the bank for the minor. 
  • An employee loses the right to claim gratuity in case his employment is terminated due to his omission or negligence that led to loss or damage but the gratuity is forfeited only to the extent of provable damage. Also in case of termination is due to disorderly or violent conduct and offence committed during the course of employment, the gratuity is not payable.
  • The employee has to make a claim for gratuity by sending a written application to the employer within 30 days of the gratuity becoming payable.
  • The employer has to pay the gratuity within 30 days of it becoming payable and if he fails to do so, the gratuity has to be paid along with simple interest at the rate of 10% p.a.

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The Maternity Benefit Act, 1961 – Brief Notes

The main object of the Act is to maintain the health of the mother and the child when the mother is not working. It provides social security. Maternity Benefit Act, 1961 was amended in 2017 and the period of maternity leave was increased from 12 weeks to 26 weeks for two surviving children. 12 weeks for more than two children and also in case of ‘commissioning mother’ and ‘adopted mother’.

It is applicable in establishments where 10 or more people are employed. According to the amendment, providing creche facility is mandatory where 50 or more people are employed in an establishment. 

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Maternity benefit is payable to women who have worked in the establishment for a period not less than 80 days in the 12 months immediately preceding the date of her expected delivery. She will be paid at the rate of average daily wage which means the period of 3 calendar months preceding the date of her actual absence or minimum wage fixed or revised, or Rs.10 whichever is higher.  

  • The employer is mandated by law to provide all details about the maternity benefits available to the female employee at the time of her joining. 
  • The Act provides that no pregnant employee is supposed to be assigned any difficult work that might hurt her or the child for the 10 weeks before the delivery date. 
  • The Act provides that Some establishments may also give work from home facilities to women employees if the nature of work makes it possible. 
  • Under the amendment to the Act in 2017, the prenatal leave has been extended from 6 weeks to 8 weeks and 18 weeks post birth. However, you can also take all 26 weeks if leave after birth. 
  • An employee cannot be dismissed for taking the benefit of maternity leave and neither can she be served a termination notice that is bound to expire before the leave is over.  Even if dismissed, she is entitled to medical bonus and maternity benefit while pregnant unless the dismissal is for gross misconduct.

[Suggested Read: Implementation Failure of Legal Aid Services in India]

The Payment of Bonus Act, 1965

The main object of this Act is to share the prosperity of the establishment with the employees in the form of providing bonus and to maintain harmony between the employer and employee. This Act most commonly deals with profit bonus, however, is silent about the statutory and customary bonus, thus, these bonuses cannot be held inconsistent.

This Act is applicable to the whole of India and shall apply to every establishment which has twenty or more employees employed on any day in the accounting year and to every factory.

[Suggested Read: Afcons Infrastructure Ltd. Vs. Nagpur Metro Rail Corporation Ltd. [Supreme Court of India, 15-09-2016]]

An employee is eligible for the bonus if he has worked for not less than thirty working days in a year in the establishment. However, a suspended employee is also eligible for the bonus if he is reinstated with full back wages as held in Project Manager Ahmedabad Project ONCG V. Sham Kumar Sahegal. Minimum Rate of Bonus Payable is 8.33% and the maximum is 20%.

  • The act imposes a legal duty on employers to pay their employees a bonus. 
  • Further, the act specifies the maximum and minimum limits of bonus and designs formula to calculate the bonus.
  • This act does not include non-profit making organisations, LIC, hospitals or any organization exempted as a sick unit by the authorities. 
  • Only those employees earning a salary not more than Rs. 10,000 are eligible for claiming even in case of loss experienced by the establishment. 
  • If an employee is dismissed from employment on account of fraud, violent behaviour, theft or damage to property, then he is not entitled to the bonus for the accounting year in which he was unemployed and also any pending bonus before. 

[Suggested Read: Objectives of Legal Aid in India]

The Payment of Wages Act, 1936 – Brief Notes

Payment of wages Act, 1936 is applicable to the whole of India. The main object of this Act is to ensure timely payment of wages to the employees working in ‘Scheduled Employments’ and to make sure there are no unauthorised deductions.

According to Section 5, a wage period cannot exceed one month. Wages shall be paid before the expiry of the 7th day of the wage period where less than one thousand persons are employed in any industrial or other establishment or railways or factory and before the expiry of the 10th day of the wage period where more than one thousand persons are employed.

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Only those employees are subject to this act whose monthly wage does not exceed Rs. 10000.

  • Under this, payment of wage can only be made in the form of currency or coins. Cheques and crediting the amount in the bank can also be methods of payment if the employee authorizes.
  • The employer is not allowed to make any arbitrary deductions other than those specified in the act such as absence from duty, damages or loss, services are given to an employee, recovery of loan, accommodation provided etc.
  • The authorities, labour offices, can be approached by employees seeking relief individually or with the help of a trade union.
  • The employer can only impose fines on the employee in case of some act or omission by him that he has already notified the authorities.

[Suggested Read: D.C. Mehta Vs. State [Gujarat High Court, 112016]]

The Minimum Wages Act, 1948 – Brief Notes

Minimum wages Act, 1948 extends to the whole of India. The main object of the act is to provide minimum wages to the persons employed in ‘Scheduled Employments’. 

The capacity of an employer to pay minimum wages is not taken into consideration as decided in U. Unichoy v State of Kerala. The contention of Minimum wages Act being violative of Article 19(1)(g) was dismissed in Bijoy Cotton Mills v. the State of Ajmer. 

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According to Section 3, for Part I of the Scheduled employment, minimum wages for the entire state have to be fixed, however, the rates fixed need not be uniform. For Part II of the Scheduled Employment wages for the entire state may not be fixed. According to Section 3(1)(b) the minimum wages must be revised not exceeding an interval of five years, however, they can be revised before the expiry of five years as well. The Appropriate Government fixes minimum wages using Committee Method or Notification Method.

  • Under this Act, the employees are defined as those who are employed for skilled or unskilled manual or clerical work in “scheduled employment”. Apart from this, the unorganised sector is also included in this provision. 
  • The Act is also applicable to any  “Outworker” who have been given work and anyone declared as an employee by the government
  • The employer is bound to pay the employee he has hired at a rate not less than the minimum wage fixed by the government for that scheduled employment.
  • Section 3 of the act also provides that the Central or state government concerned needs to fix the rate of wages with no discrimination based on gender. 
  • The punishment for underpaying the employee is up to 6 months imprisonment or fine up to Rs. 500 to the employer. 

[Suggested Read: The Contract Labour (Regulation & Abolition) Act, 1970 (CLRA) – Brief Notes]

The Child Labour (Prohibition & Regulation Act), 1986 – Brief Notes

The main aim of the Act is to prohibit the employment of children below the age of 14 years in hazardous occupations and employment. According to Section 3 of the Act, in any occupations mentioned under Part A of the Schedule or in any workshop where any process mentioned under Part B of the Schedule, a child is not permitted to work in. 

According to Section 7 of the Act, a child is not allowed to work overtime, work between 7 pm to 8 am and work in two establishments simultaneously. A child must be given a whole day of leave every week. A child is not permitted to work for more than 6 hours a day out of which he cannot be permitted to work for more than 3 hours at a stretch without an hours break. 

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According to the Child Labour (Prohibition & Regulation) Amendment Act, 2016, the Act has completely banned Child Labour i.e. employment of children below the age of 14 in all establishments and enterprises, except the ones run by his family only if it does not affect the child’s education. Child labour under this Act is now a Cognizable offence.

  • Employing a child below the age of 14 years is a cognizable offence for which a jail term of up to 2 years is provided. 
  • Other than the family business, a child may be employed as an artist in the entertainment industry, except circus, after all, safety measures are taken for their benefit. 
  • An adolescent can be employed but only after fulfilling the condition of recording all data about the adolescent, his working hours and nature of work. Also, within 30 days of employing an adolescent, information about the establishment must be sent to a local inspector 
  • A child cannot be employed in any hazardous occupation such as jobs related to the railways, foundries, mines, ports, a toxic, inflammable or explosive substance, restaurants, circus etc. 
  • A child cannot be employed in hazardous processes such as bidi making, cement manufacture, tanning, soap manufacture, working with toxic metals or substance, manufacture of dye, pesticides, insecticides, food processing, warehousing etc. 

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