Reforms in Labour Laws in India

Reforms in Labour Laws in India
                                                         By Shurlly Tiwari
of the labour laws in India are enacted decades ago, some of them were from pre
independence era of at that time the working conditions were different from the
current scenario. Therefore, there is a pressing need to reform these laws. And
the implementation has also to be charged so that the benefits of these reforms
reach to the maximum number of work force.
encourage economic growth and generate employment opportunities in the country,
the government has proposed that 44 labour laws be consolidated into just 5
1.      The
Industrial Relation Code Bill 2016(dealing with industrial relations)
2.      Wage
Code Bill 2016 (dealing with wages)
3.      The
Small Factories Bill (Regulation of employment and conditions of services,
dealing with Safety and social security)
4.      Employees
Provident Fund and Miscellaneous Provisions(amendment) dealing with welfare.
5.      The
Shops and Establishment Bill.
Draft bill:
Ministry of Labour and Employment introduced the Draft Labour Code on
Industrial Relation Bill, 2015 (hereinafter referred as DRAFT BILL) in April 2015
Government’s objective was to overhaul several issues pertaining to industrial
relations including:
Trade Unions, Standing Orders, notice of Change of terms of Employment,
Strikes, Lockouts, Lay-offs, Retrenchment etc.
Need for Draft Bill:
of draft bill is a significant proposal to overhaul the labour laws.
in India the labour laws are so ambiguous that they promote the industrial
dispute rather than facilitating business friendly environment for both the
employees and the employers. In this regard India’s needs a good labour policy
that simplifies and rationalise the complex and ambiguous extant pieces of
labour legislation into simple code rather than impaired or short-sighted law
amendments that would address only the present problems.
will also help to increase the confidence of the industry. And encourage fresh
investments from multinationals.
ID Act 1947 ,
requires industrial establishments hiring at least 100 workers to obtain the permission from the Govt. in lay off.
Draft Bill
proposes to allow industrial establishment s employing up to 300 workers to lay off without
seeking the permission from the Government
Limit of
Liberty of Workers in registration of trade union is 10%
10% will not
apply in the following circumstances.
Where 10% workers exceed 100
Where 10% is less than 7 workers.
Minimum of 7 workers shall be required to make an application for
Industrial Act 1947 ,
requires an employer to pay compensation equivalent to 15 days average pay for each completed year of service , or any
part year in excess of 6 months
Draft Bill
aims to increase the compensation at the time of retrenchment to 45 days , average pay for  each 
completed year of  continuous
Under the I.D.
Act , workers employed in Public
Utility Service
to go on strike only after giving 14 days advance notice
to the employer
Draft Bill
proposes to govern all industrial workers by the same rule for the strike
.not for only Public Utility Service.
Employer and
the workmen refers  industrial dispute
to arbitration only prior to approaching the labour Courts
Draft Bill
abolishes the concept of labour courts and propose to introduce a Dispute Resolution Mechanism through
industrial tribunal.
 Under sec. 50 draft bill entitles the
parties to refer the dispute to arbitration at any time.
Under sec.35
sexual harassment, refusal to undergo training organised by the employer etc
. is now classified as misconduct under Model
Standing Order
The time limit
for completion of Disciplinary proceedings within 3 months to 1 year from the
date of suspension.
The time limit
for completion of disciplinary proceedings within 90 days from the date of suspension.
Works men compensation act
For injury and
death the amount is increased to 1,20,000
from 80,000
disablement amount is increased to 1,40,000
from 90,000
Maximum amount
of claim can be 4.56 lakhs in case
of death, and 5.48 in case of
permanent disablement.
Maternity benefit amendment bill(2016)
leave are increased from 12 weeks to
26 weeks(
paid)  8 weeks before
delivery and 18 after child birth.
For woman who have 2 or more
children, the duration of maternity leave shall continue to be 12 weeks (i.e.
6 weeks pre and 6 weeks post the date of delivery).
12 weeks for surrogate mothers.
Free crèche facility for women,
if the number is more than 50. (earlier it was 30).
Women can visit the crèche 4
times in a day.
IT Industry in the state, has
enjoyed the blanket exemption from the Industrial Employment Act 1946, for 11
years, will now have to adhere to the rules under the labour legislation.
This means that IT industry,
like all other industries that employ over 100 workers, have to define with sufficient precision the
conditions of employment under them and make these conditions known to the
workmen working under them.
relations Bill 2015 seeks to integrate 3 labour laws
Industrial Dispute act 1947 ,
Trade Union Act 1926 and Industrial Employment act 1946 into a single code
labour Prohibition act
Now ,a  child under the age of 18 years, is not
allowed to work in the Factory premises. Earlier it was 14 years.
Gaps to be Addressed.:
Bank Data suggested that in 2013 , the contribution of manufacturing sector to
India economy was just 13%.
Contribution to world manufacturing is 1.8%, that states that India’s Stand in
manufacturing is very poor (Goyal , Kaur & Singh 2015)
India is a mixed
economy with stringent labour laws; labour laws in India make employees and employers
prone to harassment, thereby making it difficult for them in India to compete
against the global Giants in countries with simplified laws.
Several recommendations
have been made to make labour laws less restrictive for employers, this will
help create a level playing field against their international counterparts.
The total GDP
contribution of Manufacturing sector is 20%, which engages nearly 17% of total
labour force. the attempt made by the government is laudable effort, as It will
provide flexibility to the employers which will help the industry to function
in a more efficient fashion. This will also help in improving the productivity
and efficiency of worker, it also helps in improving and uplifting their life
match the Pace of manufacturing revolution, India needs to attain a share of at
least 25% contribution to Indian GDP, for attaining such growth, introducing
reforms in the labour laws of India is a new beginning which helps in starting
the new era of growth and development. It is the most important aspect in
bringing the discipline and also in bringing the flexibility to the system.
Multi-National companies were reluctant to start their business in India
because the rules were very stringent but by bringing these reforms the system
will welcome the new entrants into the economy, which will not only help in
shaping up the industry but will also help in the growth of economy and
development of the nation.
new proposals are very helpful and are in line with Make in India, as they are catering to the most important part of
the country, which is labour. According to the need of the nation, these laws
should be implemented with immediate effect.
Source: Labour Law Reporter, January, 2009. “Workmen’s Compensation Act to be Employees’ Compensation
 Page No.
Human Capital – realising Business strategy
through people –vol. 20.
IJETMAS , April 2016 , vol. 4, ISSN 2349-4476.

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