Sept-14 - Business Manager

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An Emotional Approachto LeadershipEmotions are critical component ofa leader's to-do list: from formingstrategies, building trust, setting andarticulating vision, empoweringpeople to strategy execution. It isimportant that a leader understandsthe expectations and emotions ofhis/her employees and createsignificant difference throughhis/her emotional intelligence. Anarticle by Dr. Deepti Pathak

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HR Role in EmployeeLife CycleEmployee Life Cycle directly affectsorganization goals and objectives. Itis the role of HR to take care of theemployees by building the life cycleculture.An article by Anand Kishor Goyal

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Handling employeeemotionsEmployees bring their emotions towork and their emotions areintegral to how the organizationgrows.The employees' emotionsand moods impact theirperformance, decision- makingability, creativity, teamwork,negotiations and leadership. Anarticle by Neelima Chauhan

8

Dr. Vinayshil Gautam 4

Salient features of The Apprentices(Amendment) Bill2014

An article by Alok Rawat

55‘Employee’under E.P.F.

An article byH. L. Kumar

56

Sun Rises in the East

By Simran Oberoi

Rewards & Recognition

32

Global RewardsStrategy for Indianorganizations

Cove

r Fea

ture

Should CTCsystem bereviewed ?An article by V. Sirinivas

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Make Laws simple

Labour reforms need to beaddressed from national perspective

Time to implement laburcommission’s recommendations

Working conditions regulationsshould have uniformity

The complexities in LabourLegislations

Can law makes Unions responsible &transparent?

Reforms should not run the risk ofignoring ‘knowledge workers’ rights

Pankaj Dewan

Dr.Tapomoy Deb

K.Varadan

B.S.Dagar

Supriya Rakesh

Michael Dias

Dr. Rajen Mehrotra

Contract Labour Act: Remove the AmbiguitiesID Act: From disputes to harmony

BM Research Team

What Industry & Unions want Comparitive Study of select Countries

12 - 31

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Readers are invited to comment on articles published in BM through email at : [email protected]

Core is overall competencyAs this month’s magazine Titled Jobs & Skill building is truly relevant and will everremain relevant. Have got a chance to glance the different articles by our intellectuallyactive population. Almost all articles are talking about Learning and Competencies.I strongly believe that this is the area where always remains a great scope for valueaddition. If anyone aspires to get the job of his choice either at entry level or to gohigher in hierarchy one needs always to upscale his technical competency. Bytechnical competency I mean all factors like: Knowledge, Skill, ability, Machine or thetools being utilized as well as the internal & external dynamics etc. affecting theeffectiveness of the role.I liked few lines : A degree does not mean education and education does not meanemployable….All these excerpt emphasizes that unless one does not have reasonable degree oftechnical competencies( Overall competencies ) for a role he or she cannot be 100%employable.As usual I look forward to read the articles and information’s published in thismagazine which always remains contemporary and relevant.

-Jayant Kumar

Jobs RiseThis refers to your cover story on Jobs & SkillBuilding. I would like to bring to your notice therecent data of economic sensus according to whichthe number of employed persons in the countrygrew by 34.35 per cent to 127.7 million in eight yearsup to 2013, according to the Sixth Economic Census. Employment in urban parts increased by 37.46 percent to 61.4 million in 2013, whereas in rural areasthe growth was 31.59 per cent to 66.2 millioncompared to 2005. The proportion of women intotal workforce rose to 25.56 per cent in 2013 fromabout 20 per cent in 2005. In urban areas, theproportion of female workers was 19.8 per cent and30.9 per cent in rural areas. Maharashtra has the

highest number of employees at 14.3 million, followed by Uttar Pradesh at 13.7million, West Bengal at 11.5 million, Tamil Nadu 10.8 million and Gujarat at 9.063million. Among union territories, Delhi has the maximum number of employees at2.98 million followed by Chandigarh at 0.23 million and Puducherry at 0.21 million in2013.The country's population was over 1.21 billion in 2011, according to 2011 census. TheEconomic Census does not include employment in agriculture, public administration,defence and compulsory social security services activities. The growth in employment at 34 per cent in eight years period is a good rate. Thatmeans that it had grown at an annual rate of over four per cent, when the populationis growing at two per cent. The number of establishments or firms increased by 41.73per cent to 58.4 million in 2013 over 2005 level. The number of firms grew by 45.57per cent during eight years to 23.4 million in urban areas. Such firms grew by 39.28per cent to 35 million in rural areas during the period. According to the SixthEconomic Census, the percentage of hired workers in the entire workforce was 45.69per cent in 2013.

-Sushant Sharma

OverwhelmedI am deeply overwhelmed on you August issue on Jobs and Skill building.Each article surpasses the other. in terms of content and the value additionto the practicing processionals. EMPLOYEE RETENTION: THE VARYINGDIMENSIONS by PBS Kumar deals in simple language depicts the innermeaning of the job. Motivation is the key element and provides tips for selfmotivation. Every one has to practice this. My congrats to BM to bringarticles in terms of quality and high standard content to be practiced byeveryone. My regards to BM TEAM.

-K.Soundarraj


Questions by readers on variety ofproblems they face at work and answeredby Anil Kaushik Chief Editor. Look at it.These may also be of some help to you.42

60-64

60

Latest from theCourtsLatest verdicts from different High Courts and SupremeCourt effecting employer employee relations.44

59Develop relevantmetrics tomonitor progress

36

EVENT Report &

By Pravin Durai

Can HR be a competitiveadvantage?

58

Practical Guide to Factories ActAuthor : H.L. Kumar

Legal Framework on Electronic Commerce And IntellectualProperty Rights In CyberspaceAuthor : Pavan Duggal

Revised Minimum Rates of Wages in MaharashtraThe Factories (Rajasthan Amendment) Bill, 2014The Apprentices (Rajasthan Amendment) Bill, 2014The Contract Labour (R & A) (RajasthanAmendment) Bill, 2014The Industrial Disputes (Rajasthan Amendment) Bill, 2014Minimum Wages in Haryana




Once again the drums of labour reforms are beating. It is not new for us. The countryhas witnessed such orchestra earlier also. There have been two labourcommissions and their reports are gathering dust somewhere in Govt. Corridors.Many proposals, conferences recommendations, Bills and reports at differentGovt. level are discussed, prepared and died of their natural death during lastthree decades. Perhaps, these are the only laws which got the stroke frompolitical inaction thus almost remained same or if amended were low on impactand high on cosmetic value.

With the new Govt. in center, employers have again pushed the agenda of labourreforms. It has been linked with employment and economic growth. It is statedthat the the root cause of unemployment and slow economy is the obsoletelabour laws which have not been amended according to changing times.Employers want free hand in doing their business with hire and fire policy andless regulation. On the other hand workers bodies contest that the problem is notwith labour laws which have been painted as archaic or outdated but with the

ineffective enforcement and non complianceattitude of employers. They fear that if thereforms, as demanded by employers, arecarried out, there will be increase inunemployment and workers will losebargaining power.

In spite of having two opposite opinionsCentral Govt. have initiated a small move toamend the laws but not as a whole.

We firmly believe that patch work in thisdirection will not work rather harm theenvironment now. Reforms need to be radical.And these should be three fold; legislative,

administrative and judicial. There are experiences that legislative reforms in theabsence of administrative and judicial reforms have not worked and broughtchanges in the society as expected. Legislative changes should bring uniformityin various definitions in different laws. Laws should be as minimum as possibletowards simplification away from ambiguity. Provisions which have becomeredundant should be repealed simultaneously from all laws. The changes shouldstrike a fine balance between workers rights, social security, health, safety andgrowth with opportunities of more employment.

Administrative reforms should be directed towards changing mindset of labourauthorities to understand the cause of conflicts between the two pragmaticallyand clothed with more powers to diffuse the tension and unrest. Judicial reformsshould be directed towards creating a mechanism where industrial disputes aresettled /adjudicated within few months or at least within a year in the form ofsummary proceedings. It will certainly influence the employers and workers toresist from indulging in confrontation and encourage to move from conflict tocooperation.

Cover story on Labour reforms is a fine and well researched pack of experts views on thesubject and different laws which need reforms.

If you like it let us know. If not, well, let us know that too.

Happy Reading!

No Patchwork please!

Chief Editor ANIL KAUSHIK

Associate Editor Anjana Anil

Hon'y Editorial Board Dr. T.V. RaoDr. Rajen MehrotraDr. V.P. SinghH. L. Kumar

Hon’y Research LeadIndranil [email protected]

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Ibelong to a generation which was taught in school "Jawaharlal Nehru is yourChacha". So like every other child of my generation I thought of him andtalked of him as "Chacha Nehru".We were also taught that Chachajee simplyloved children. I fondly believed that. I remember going to England when Iwas five and when admitted to a school there, informing other children that

my uncle was the Prime Minister of India. All the kids of my class being of my agecelebrated that, though I am not quite sure if they understood what that meant.Unfortunately like all cookies it had to crumble and when my birthday came theywanted to know, if my uncle was coming. I remember making some outlandishexcuse and my mother even backed me up on that, till my father stepped in andinformed me and the other kids that "Nehru was his brother 'in a manner ofspeaking' " and that it need not be taken literally. I am not quite sure if the otherkids understood what was meant by the expression 'in a manner of speaking' butit saved the day even though it left me confused. My mother could never explainwhy Nehru Uncle never visited us or why we never called on him.Till one day, Igrew up enough to realise that the joke was really on me and I felt stupidabout it.Till this day I have not been able to figure out if myfeeling stupid meant anything to anyone. But yearslater it did help me to understand whatindoctrination was all about.

We practice indoctrination inmany ways big and small. It is an

essential part of our socialisation. I am told it is anessential part of any civil society. Like one fine day even

before you know what it is to think, a women holding you in her armspoints out to a man and teaches you to repeat "Papa"/"Daddy'/"Baba"--whatever.You grow up to realise that reference means 'father' and you believe you are hischild on one women's testimony. Of course you can ask for a DNA test but even aman of wisdom like ND Tiwari walked through creating every possible obstacle tillhe agreed to give the test and fail. A case of faith and believe .I am told by wisepeople this is necessary to maintain the fabric of the society.

I guess it is too late in the day raise fundamentalist dilemmas. But thecontradictions of our existence do bother me.

I met Jawaharlal only twice. On both occasions, I was far too young to engage himin clarifications. But I am also told he believed in inculcating a 'scientific temper'and he sincerely believed in it.Then, I wonder, why did he trigger off this sillybusiness of being every child's uncle? Or was it a part of the larger mythificationwhich subsequently his family practiced for generations with great aplomb. Indirabecoming a Didi and Sonia the quintessential bahu. An argument which sheadroitly used in the early years of her political ascendance.

Or is it that it a part of our political sociology because Chaudhary Devi Lal becamea tau and of course the number of Bahenjees and Ammas keep multiplyingregularly.The number of Bhaias are of course too numerous to count.Though Imust hasten to add the Chacha example is without compare!

Perhaps this is a spoof on the general role of how early socialisation determinesconcepts.

The belief that sun rises in the east and sets in the west is universally held andtalked of, so much so that sovereign territories are known as the "land of the risingsun" and more. Anyone who cares, knows, the sun never rises or sets. Or indeed itcannot rise or set. But indeed it is the earth that rotates around the sun.Then whyperpetuate this strange thought of rising and setting, as if an illusion is necessaryto life!

Or maybe it is. Human resources as a profession have to address this question.

Sun Rises in the East

The belief thatsun rises in theeast and sets inthe west isuniversally heldand talked of. Butindeed it is theearth that rotatesaround the sun.Then whyperpetuate thisstrange thoughtof rising andsetting, as if anillusion isnecessary to life!

Dr.Vinayshil Gautam

BM



An Emotional Approach to Leadership

Emotions are criticalcomponent of aleader's to-do list: fromforming strategies,building trust, settingand articulating vision,empowering people tostrategy execution. Itis important that aleader understands theexpectations andemotions of his/heremployees and createsignificant differencethrough his/heremotionalintelligence.

What did Mahatma Gandhi, Lal Bahadur Shashtri, MotherTeresa, and Nelson Mandela have in common? All four hadthe ability to understand emotions of people and lovedmankind. Multiple theories of leadership share the view thatoutstanding leaders go beyond simple carrot and stick

approach and create a significant impact on their followers and theirorganizations. Research in neuroscience and psychology has shown thatemotions can profoundly influence human thinking and behavior inpowerful ways and effect the way we perform in business.

Emotions are critical component of a leader's to-do list: from formingstrategies, building trust, setting and articulating vision, empoweringpeople to strategy execution. There are many past evidences which show

Dr. Deepti PathakAssistant Professor, LalBahadur Shashtri Institute ofManagement, New Delhi

that the leaders who cared for their people wereand are more successful. Steve Jobs started asan autocratic leader but soon realized that tomeet burgeoning competition, he too neededto follow Bill Gate's way. He transformed hisleadership style and become more peopleoriented. The fortune of Infosys waschanged by Narayana Murthy, who is againknown as a people-oriented person. Hetreated his employees with dignity andcared for their emotions. Another exampleis a visionary leader Ratan Tata, who tookan audacious decision to announce thelaunch of a car worth Rs 1 lakh only whichmade the dream of owning a car come truefor lakhs of medium and lower income groupindividuals. Tata Nano is famous as "APeople's Car". The iron man who helped RatanTata achieve his vision is our Prime MinisterNarendra Modi, who permitted him to set-upthe manufacturing plant at Sanand (Gujarat).Modi showed his love and care for peopleduring his election campaign too. In alladvertisements BJP primarily hastargeted the emotions of the voters whowere feeling cheated by the UPAgovernment. In one advertisement, PMModi was shown saying "saugandhmujhe is mitti ki yeh desh nahi mitnedunga." and slogan like "sabka sathsabka vishwas" compelled people to forgettheir individual identity for a while and thinkabout their social identity. No one can forgethis first address to the nation where he beganemotional and the way he bowed and kissed thesteps of the Parliament before entering thereas the Prime Minister. During his electioncampaign, his emotions were more powerful ascompared to his words. And that made all thedifference.

The human factor Normally, when asked in interviews about

weaknesses, majority of the job seekersmention "being emotional" as their weakness.Few parents complain that their kids aretaking undue advantage just because they areemotional. A key question that arises here is:"Is being emotional really a weakness"?

We as human beings work on a thoughtprocess which is neither rational nor real. Weoften talk about emotions but only in privateand not in public. These issues are stillconsidered as taboo subjects in the corporateworld. In the words of world knownpsychologist Daniel Goleman, while using

emotional intelligence, one tries to maintain abalance by promoting positive emotions andkeeping a check on the disruptive negativeemotions. Leaders need to be emotionallyintelligent to harness the talent present in theorganization. Three ingredients of emotionallyintelligent leaders are empathy, equity andempowerment. Every year organizations arespending hefty amount on the employeeengagement activities, yet the result is same. Ahandful of training programs cannot helpcorporates engage employees. An outsidercannot understand your employees in fewinteractions. Rather, you as a leader canunderstand the expectations and emotions ofyour employees and create significantdifference through your emotional intelligence.Unfortunately, many executives continue tobelieve that emotional suppression and taskfocus are the best ways to get results.

Empathy, equity andempowerment

From recruitment to retention, then role ofemotions is inevitable, yet organizations areresistant to accept it. A person cannot perform




Leaders should accept that to accomplish their vision, they need to keep people engaged andcreate an emotional connect with the people as its evident through research now, that it is theunconscious mind and not the conscious mind that drives people response and behavior.




well unless he/she feels an emotional connect withhis role at work. Research indicates that resumeswith photographs are shortlisted three times morethan those without them. Photos can create anemotional and psychological connect. In manyorganizations attendance is through biometricswithout flexi-timing. Individual coming late, evenunintentionally, is penalized for the same. Thiskind of treatment creates negative emotions andresearch suggests that brain passes negativeemotions faster as compared to the positive ones.Sometimes even the best performers are not able todeliver results. We can take the example of Messiin the FIFA World Cup 2014 finals.

Generally companies focus on formingstrategies but they fail to prepare a contingencyplan which affects the execution. The Brazilianteam planned well but probably, they never thoughtof playing without Neymar and Silva in the semi-finals. Too often, leaders are so busy makingstrategies that they fail to take into account theimportance of teamwork, which is a by-product ofemotional connect with the work and theworkplace. Leader should empathize well with theemployees to create a perception of transparencyand fairness in order to promote team work and getbetter results.

Extensive research has been done on Fairnessby Prof. Golnaz Tabibnia of Carnegie MellonUniversity. She says that the tendency to resist andfight against unfair outcomes is deeply rooted inall human beings. This gives an insight to theleaders that any work environment that isperceived as transparent and fair will be moreproductive.

People in organizations suffer from "statusanxiety". This term "status" is formed through therecognition and worth of their work at theworkplace, relative to others. Most of the leadersconsider empowerment as the best tool forengagement and recognition. Middle and lowerlevel executives, often are reluctant to displaynegative emotions in connection with decision-making, being concerned that the top levelexecutives might doubt their abilities. This resultsin decision- making where illusion of unanimity isthere. Leader should promote differences inopinion and allow the actual emotions come out forinnovative and effective decision-making.Sometimes because of strong group norms,individual emotions transform into groupemotions. Now, to manage group emotions one firstneeds to understand the nature of it.

Collective emotionsAristotle once said, "Man is by nature a social

animal", this has now been universally accepted.David Rock, Co-founder of Neuro-leadershipinstitute says that the brain experiences theworkplace first and foremost as a social system.Apart from our individual emotions, we care moreabout collective emotions at the workplace.Collective emotions are the emotions shared by alarge number of people about a cause, new policyor new strategy, and are not likely to disintegrateso easily. Recently after the Brazil's 7-1 loss toGermany in theFIFA World Cup 2014 semifinals,we saw the heart break and anger amongst footballfans. Even though, it was not going to affect theirprofessional or personal life either. Thisphenomenon is called collective emotions.Expression of true emotions at the workplace isnot considered to have positive impact on thecareer growth. People can suppress theirindividual emotions for their professional growthbut collective emotions are difficult to control.Research suggests that emotions drivenunderground tend to incubate and resurface later.Worker's agitation and violence at Maruti'sManesar plant in year 2012 is an example. For

successful strategy execution, managers need tokeep this collective emotions framework in mind toavoid hiccups.

Empathy, equity and empowerment were thethree actual pillars behind the success of PMNarendra Modi. He showed empathy for theunemployed youth and the less empowered people,trusted his party members, and treated everyone infairly. Extensive use of social media was nothingbut to keep his policies transparent and target theemotions of people. He dreamt of the sky whilekeeping an emotional connect with the commonpeople.

Indian managers need to learn lessons from hisleadership style. From advertisements to customerrelationship management, hiring to firing anemployee, emotions are inevitable. Leadersfollowing Chanakya Neeti and ignoring philosophyof Bhagvad Geeta are likely to face challenges inexecution of their strategies in the long run.Leaders should accept that to accomplish theirvision, they need to keep people engaged and createan emotional connect with the people as its evidentthrough research now, that it is the unconsciousmind and not the conscious mind that drivespeople response and behavior. BM



An organization without emotions isdead. But when we say 'emotions'well…it's both positive andnegative. In every organization,you will find coworkers who do not

have anything positive to say, whether at theweekly huddle or in the cafeteria or at aperformance review. They are capable ofextracting every bit of energy from abrainstorming session. Their bad mood isinfectious and soon others are in the loop too.This kind of pessimism can contaminate ahappy environment. A Wharton managementprofessor who studies the influence ofemotions on the workplace said, "Emotionstravel from person to person like a virus."

It is a known fact that employees' bring theiremotions to work and their emotions areintegral to how the organization grows. Theemployees' emotions and moods impact theirperformance, decision- making ability,

creativity, teamwork, negotiations andleadership.

Positivity tends bring optimism, honestyand productivity in workplaces. Positive peoplework more efficiently and more appropriately.If someone is in a negative mood, it flows to hiscoworkers. When one is in a positive mood, oneis open to ideas, thoughts and feedback.

Handling divorce-an emotionalroller-coaster

Ritu had won the best employee award forthe 5th time in 6 years of her career at in herorganisation. But her performance review forthe 7th year was not what she had everanticipated for herself. Five years into hermarriage, Ritu was struggling with a divorceand an equally ugly and painful custody battlefor her 5 year old son. During this time ofpersonal crisis, what remained unchanged was

Handling employee

emotionsNeelima Chauhan

HR Counsellor & Director, School of Management Skills

Employees bring their emotions to work and their emotions are integral to how the organization grows. The employees' emotions and moods impact their performance, decision- making ability,

creativity, teamwork, negotiations and leadership.

Handling employee emotions



her relationship with her manager at work. She gotunwavering support from her manager especially, whenRitu needed time off for court dates or meetings with herlawyer. Ritu, was always a hard worker, dedicated to thecore. During this personal crisis, whenever she would feeldistraught and her self esteem would dip low, she wouldget one-on-one counseling from her company's corporatecounselor and a life/career mentor. And when she wasready to move on, she turned to the company's home loanprogram, which helped her buy a new home and start lifeafresh. Ritu in her own words says, "The support I got hashelped me in every step of the way."

Situations like Ritu's are not uncommon. It is a knownfact that not nationally but internationally as well, thedivorce rate is high among workers in certain professions.And employers too, have woken up to this fact and aredoing their bit, both personally and professionally, to helpemployees through this challenging, potentially diverting,and all-too-common situations. This act of sensibilityamong employers has paid priceless dividends both foremployees and the organization. Well, this just one side ofa story. Different employers also respond differently todivorce. Some employers may not accept the downhill in aworker's productivity due to personal issues.

HR-an extra effortHR may not always have information on what is

happing in an employee's personal life. An HR managermay not know if an employee with poor productivity isrecently separated or in the early stages of seeking adivorce or is facing any other challenging situation. Toremain helpful in such situations, an employee-friendlyHR can upload some information in the organization'sinternal site so that employees can download theinformation they want. Another important way HR can beof assistance is by providing extra flexibility in a person'swork schedule…….

Handling sensitive issuesIf you are in HR and also a compassionate person, I am

sure your humane side will provoke you to provide ashoulder for a grieving employee to cry on. It is absolutelyhumane to show sensitivity and genuine concern buttaking the employee's problem personally may not provehelpful either to the company or the employee. Avoidtaking on the role of therapist or best friend in suchsituations.

Drawing a lineWhen employees approach you with their issues, you

must decide to set limits on how long you're going to lendyour ear and how far you're going to get involved. Avoidthe trap of over-involvement. Apart from providing helpfrom your end, refer the employee to any legal assistancein addition to psychological counseling, if theorganization has such provisions for its employees.

Ask….When an employee is definitely showing signs of stress

and it is impacting his/her work, it is time for you as anHR to inquire however keeping in mind the employee's'privacy preferences. Some employees avoid talking abouttheir personal life with HR unless it's absolutely essential.However, there are others who will be the opposite. If theHR doesn't ask regularly how it's going and whether theyneed anything, employees will feel like the company

Best Practices1. Empowering the leadership team to communicate effectively withemployees faced with emotional issues. "Have them talk to someone inHR…" is a common response among mangers.

2.Avoid dealing with an angry employee in front of others. Do it in theprivacy of your office.

3. If an employee is venting anger in a meeting or team huddle ask theemployee to express the cause of it. As a manager stay calm, listen andseek solutions.

4. Anger is a natural emotion but it has no place in a place of work. As amanager try to understand your coworker,create solutions and stay calm.

5. An emotional employee is often considered to be unproductive. Tryto understand the employee's mental state and help him/ her.

6. Avoid being empathetic, but act sympathetic when required. As amanager you can recommend professional counseling if the situationcannot be handled at your end. The employee must feel comfortablewith the manager and know the manager will not disclose what is said.

7.Do not ignore your emotional employee.The worst thing a managercan do.

8. Focus on the behavior, not emotions.

9. Advice, be a friend.

10. Communicate strategically. Know the details and then help.

doesn't care. And this will impact their loyalty to the company.

Managing emotions at workThere are several ways of managing emotions at work. As

employees there are situations when we tend to show our emotions onthe surface and avoid showing what we actually feel. For examplewhen a coworker wins an award, an employee may fake a smilethough he is unhappy. This method of managing emotions may lead todiscrepancy between what employee expresses and what he actuallyfeels and result in job dissatisfaction. This kind of emotion is oftenaccompanied by high emotional exhaustion, low organizationalcommitment, and low job satisfaction.

Questions and answersHow to deal with an angry employee? How do you (especially men)

deal with a woman crying in your office? Most male managers I'vedealt with don't seem to have any idea what to do. Many coworkersthink it's "inappropriate and unprofessional. If I have to give myopinion on tears or fits of temper on the job, I would say they are anatural way of conveying strong feelings. I'm a woman and I do notconsider crying to be unprofessional. But there are men who may notfeel comfortable with women crying at workplace.

Managers listen….. Insignificant emotional outbursts can be handled many a times by

listening and talking. Managers at times are unable to give an ear totheir employees because of their egos. For one to be a good manager hehas to be respected rather than a winner of a personality contest. Themantra is be fair, be firm, be consistent. Managers also should realizethat emotional outbursts can be indications of serious personalproblems like alcohol, drugs, spousal abuse, sexual harassment, etc.

ConclusionIt is not that emotions have no place in the workplace; positive

emotions can help to motivate and improve understanding. As anorganization, it is not possible to change the way employees feel andact, what managers can do is change the way we react to them. BM



Since the inception of corporateculture, myriad changes havetransformed the way it manifestsitself in an organization.Organizations today have crossed the

barriers of geographical locations, and go bythe phrase "The world is our home". Everylocation that an organization operates in, a newset of human paradigm is created that isspecific to the location's ideologies. To conformto the requirements of these vulnerabilities,organizations have started moving toward theconcept of an engaging workplace. Anengaging workplace is nothing more than arewarding, fulfilling work atmosphere thateffectively motivates employees in connectingwith the organizations at a sublime level anddelivering their best for the mutual benefit ofeach other.

So, how do we create an engagingworkplace?

To create an engaging workplace, it isimportant for organizations and their decisionmakers to understand the vulnerability ofhuman behavior and adjust the ground rulesaccordingly. Gone are the days whenorganizations only lived for externalcustomers. The equation is simple now - anengaging workplace equals profit, as employeestend to work happily for such organizationsthat go out of their way to support them incrisis situations, and do not abandon them atevery possible opportunity. Therefore, it is notrocket science to design an engagingworkplace, it only requires pure application ofproven strategies.

Almost all of us have heard about Maslow's"Hierarchy of Need" theory which basicallytalks about basic human motivations. Let'srefresh our memory on the theory; we havephysiological needs, safety needs,belongingness, esteem and self-actualizationput in a pyramid structure in the same order.Now let's use this theory into organizationalscenario to see how we can implement inemployee engagement.

Basic work environment and hygiene

Before the fancy motivational factors comeinto play, the most imperative aspect for anyorganization is basic work environment andhygiene. From infrastructure to extra facilities,an employee singularly requires the basics tobe in place. The office should be comfortable,backed by effective administration, and funplace to work in. Post the basics, it is all abouttopping up the benefits for employees. Forinstance, several organizations offer free foodwith multiple cuisines to all their employees.Many organizations encourage work fromhome culture by allowing employees to stay athome, whenever the need arises. At hCentive,we have flexible working hours which provideemployees with an option to work in a suitableschedule. Other than infrastructure andhygiene, the basic requirements of job profileand the quality of work also constitute thehealth of the working environment.

If employees are getting a chance to usetheir creativity and problem solving skills,they tend to be fulfilled with their jobresponsibilities. With a matchingcompensation package and inherent job

Creating an engagingw o r k p l a c e

A health mix of existing and innovative strategies can create an engaging workplace thatcan contribute to employee satisfaction and retention in the long run.

Manish Garg

Head of India Operations, hCentive

security, these basics pave the way for othermotivation factors and lay the stone for qualityworkplace engagement. Essentially, all thesefactors pick up from the physiological needsand safety needs of a human. In anorganizational setting, the above aspects meetthe physiological and safety section of theMaslow's "Hierarchy of Need" pyramid, andpush for fulfillment at work.

Similarly, an open work culture inculcates astrong bond between the employee and theorganization. An open work culture allowsemployees at every level of the organization toparticipate in the decision- making efforts ofthe firm. Collectively, employees contributetoward the direction of the organization andultimately engage more effectively with theworkplace.

Achievement recognition andrewards program

Once the basics are in place, the mid-levelmotivation factors come into the picture. Forany employee, recognition is a primary driverfor workplace engagement. Achievementrecognition drives self-esteem and self-value ofemployees. As per Maslow's "Hierarchy ofNeed", self-esteem is one major pillar whichrequires gratification for an employee to besatisfied with the workplace. Throughachievement recognition cum rewardsprogram, an organization can reward theefforts of workers and propel them to bettergrowth curves.

Concurrently, recognition flows throughleadership in the form of inspiration thattrickles down to employees, and this helpsemployees in finding the right growth paththrough the rungs of the ladder.Communication holds the key in connectingemployees with the workplace andorganization. Through improvedcommunication channels

and openness in the workplace, the evil ofcommunication gap is cut off to leave a clearflow of information that is unaffected byrumors and grapevine. Finally, opportunitiesshared by employees help them hone theirabilities and improve their performance,ultimately earning them recognition andrewards and driving engagement within theworkplace.

Collectively, the strategy of achievementrecognition and rewards program contributesto Maslow's "Pillars of Self-Actualization,Esteem, and Belongingness", and drivesemployee satisfaction and engagement atworkplace. Through monthly and quarterlyrecognition and rewarding programs, weimplement the same strategies for drivingengagement at hCentive.

Career advancement andorganizational growth throughexcellence

Self-actualization lies at the summit ofMaslow's pyramid and signifies the utmost rolean employee can play in the workplace. For anemployee, it signifies the influence he/she hason the direction of the organization. Decision-making, leadership, and organizational goaldriving are some ways through which anemployee can contribute to organizationalgrowth and direction. At hCentive, for instance,"The Hive", our Fellows Program, picksindividuals to prepare them as future leaders ofthe company. Once the employee has provenhimself, the management goes an extra mile andprovides complete ownership of tasks to theseemployees to nurture their esteem. Oncenurtured, these values bring in a sense of

achievement and increasedcohesion between the employee andhis\her workplace. Internalpromotion to a position with vestedpowers is another way to bind anemployee to his workplace.

Since Maslow's "Hierarchy ofNeed" is still applicable toemployees, each of the abovestrategies contributes to basichuman satisfaction andultimately drives engagementat work. The increasing influxof millennial employees isprompting organizations tosearch new ways to add tothe proven strategies of thepast. With a health mix ofexisting strategies andinnovative strategies,organizations can hope tocreate an engagingworkplace thatcontributes to employeesatisfaction andretention in the longrun.

Creating an engaging workplace



An open work cultureallows employees atevery level of theorganization toparticipate in thedecision- makingefforts of the firm.

BM

Cover Feature





Cover Feature

The new Govt. atcentre has come topower withastonishingmajority on certainpromises out ofwhich one waslabour laws reforms.

The country is looking at thesemuch needed reforms from lastthree decades but nothing muchhas happened.

A lot is to be done on labour laws.Selective state amendments

will not work. Country needsreforms of high impactwhich can only be done incentral legislations onlybecause problematic

legislations likeIndustrial Disputes Act,Contract Labour Actand Trade Unions Actshould only be setright by central Govt.It is unfortunate thatso far the indicationsare of patch workonly with low impactamendments inselective two orthree legislationsthus show lack of

conviction and courage in bringingradical changes. Half heartedapproach is neither going to benefitindustries nor the working class.

The Experts in this cover storyexplain what kind of amendmentsshould Govt. consider in differentlegislations to set the ball rolling.



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There is no doubt that changes in country's labour laws areoverdue. Every time there is change in Govt. be it centre orstate, issue of amendments in labour regulations comes onsurface. Time has changed, economic policies have changed,ways of doing business is changed and working class profile

is also changed but laws governing employer employee relations havenot been changed. It is impeding.

I think the most problematic issue is of having so many laws whichonly creates confusion and complexities. So the Govt. should seriouslystart working on consolidation of various laws to make It simple tounderstand and comply with. India's manufacturing sector has notbeen growing as it could have been, since long. Despite of economicreforms that took place in 1990s, our manufacturing sector could notimprove much its competitiveness at global level.

The reasons could be many. The issue that needs to be addressed onpriority is to inculcate the sense of discipline among working class.Trade unions having affiliation with political parties have utterly failedin it. They have rather helped enlarging the drift between employer andtheir employees . They have painted the wrong picture of employers asfar as trust is concerned. It should be reminded that no employer wouldlike to part away with efficient and effective human resource. He is inbusiness to do only business within the frame of stipulated laws on bothsides : providing appropriate comfort to working class as well asmaintaining discipline. Whereas the unions have little concern withbusiness issues and problems of employers. There can not be anyprosperity in the society without providing an environment of growthto business. Laws should be so reformed that political interference oftrade unions in business should be eliminated or minimized . Workersshould be taught of duties along with rights. They should be learned tomaintain balance between the two. Unfortunately our present laws areover protective that only talk of rights & at times misinterpreted evenfor illogical expectations . It might have been proper and just during thetime when they were enacted but now with passing of decades, laws donot reflect the requirements and obligations present day business andpeople working for it. If Industries are relieved from such drainingactivities , more job opportunities are waiting for the youth.

This is the time of technology. Reforms should be done keeping themind the optimal use of technology to increase effectiveimplemention, transparency and processes. We are still living in thetime of making registers, records and returns manually and

draining the human power and competency which can besimplified & minimized. The mindset of Govt. agencies of

command and control over manufacturing sector has to bereviewed. Laws should not make business activities hard and

unbearable but simple and transparent.

Govt. should focus improving regulations andindustrial relations closer to the ground in states and

industries. Changes in national laws do not bringcompetitiveness. Recent example of Raj. state Govt. of

clearing amendments in few labour regulationssupports this view. Raj. State has become preferred

choice of industrialists for investment , being thepragmatic approach of the Administration. But at

the same time Government has to ensure thattheir objectives are met with proper ground level alignment & practicalapproach changes with the same speed .

No industry can grow without adopting collaborative approach.Different stakeholders should understand each others' point of view; beit Govt . or unions. Both have to engage themselves in continuousdialogue apart from legal frame work . Govt. Has to find the reasons ofunrest and incorporate suitable changes in the present laws so thattrust deficit is not there and industry feels confident in doing businessas well the employee community do not only look for job security butalso become confident to perform and deliver to remain competitive.This can be done by making suitable amendments in IndustrialDisputes Act. What the law makers should consider while makingchanges in the regulations are two issues : restructuring to maintaincompetitiveness in market and indiscipline among working class whichmay eat up the productivity of industries.

Make Lawssimple

Pankaj Dewan

G.M.- Operations & Factory Manager,Daikin Airconditioning, Neemrana

BM



Cover Feature

There is no complexity in achieving labourreforms, once the requirement for reforms isaccepted as a national necessity, an Indiaimperative and there is a sincere political willto introduce and implement the same.

Regrettably, we have always considered labour reformsfrom the prism of varied stakeholders, be it judicialactivists, promoters of social justice, workmen,consumers, bureaucrats, politicians, employers, tradeunions and the list is endless; each is a stakeholder in hisor her own right. However, labour reforms, whenaddressed from the national perspective of the Indiancitizen and on the touchstone of what is best for ourcountry, India, there is just no controversy or debate indesigning a package of labour reforms.

Every Indian citizen has the dream to see India as themanufacturing hub of the world. We have humanresource, manpower, technology, capacity, creativity andall other ingredients necessary to achieve our objective.However, the question is, do we have an investor-friendlyclimate, so that both Indian and foreign companies mayset up shop without being wary of entering the Indianmarket due to the perception of an unfavourable labourlaw regime prevailing in the country? A simpleillustration is why do we still have the "inspector raj" andthe necessity for inspections and prosecutions? Can wenot adopt the self - certification procedure? - Why areemployers treated as common criminals, when, in fact,they contribute much to the national economy? Theanswers are self-evident. Each so-called stakeholder hashis own agenda in dealing with labour reforms and is,therefore, not prepared to accede any ground. Thepolitician is anxious to patronize his vote bank byplacating labour as they constitute a strong and largevote bank constituency. The workmen are organizedunder the banner of trade unions who respond to theirpolitical bosses, consequently, their actions are driven,keeping in mind the agenda of their political masters tomaintain the vote bank provided by the workers. On theother hand, the bureaucrats are anxious to ensure thattheir bread is buttered on both sides, so they havedeveloped brilliance in the technique of running withthe hare and hunting with the hound. Have you everencountered an official of the labour department whoreaches out to both the worker and the employer inensuring that labour laws are fairly understood andimplemented? Have you encountered an official of thelabour department who can truly be dubbed as a friend,

Labour reforms need to be addressed from nationalperspective

Michael Dias

Labour Law Expert, Advocate, New Delhi



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philosopherand guide toboth workera n dm a n a g e m e n t ;these are rareexperiences inthe labouradministration,both at central andstate levels in thiscountry.

In the abovescenario, the obviousconsequence is thatlabour reforms areconsistently deferred;ancient and archaiclabour laws enactedeven before we became afree nation, continue tobe on the statute book andare referred to for all operational intentsand purposes. There is absolutely nocommitment or desire for rationalization ofexisting labour laws. In fact, the travesty ofthe situation is that existing labour lawsapplicable to the organized sector are willynilly thrust on the unorganized sector. Toillustrate, the law of termination orretrenchment of workmen is identical bothin the organized and unorganized sectorsalthough the working dynamics are entirelydistinct and different.

Further, do our Judges and law-makerssincerely believe that even today, section 36of the Industrial Disputes Act, 1947,deserves to be on the statute book; the saidprovision of law debars and prohibits anadvocate per se to represent a party beforethe Industrial Tribunal, Labour Court oreven before the conciliation mechanism,whereas it is a known fact world-wide, thatone of the most complicated laws in Indiaare the plethora of labour laws where theterm "Workman" means different personsunder different labour legislations or thatthe term "Wages" has different meaningsunder different labour laws. There are closeto fifty labour laws enacted by the centralgovernment and several hundreds byrespective state governments. Incidentally,"Labour" is an issue that is placed in theConcurrent List of the Constitution ofIndia; it implies that both the central andstate governments are competent to enactlaw on the subject. In such a complexsituation, how is it conceivable thatadvocates and lawyers be prohibited tofunction and operate under the provisions ofthe Industrial Disputes Act, 1947?

In view of the above prevailing situation,it is time that we move with changes inlabour laws to improve the competitivenessof business and industry and ensure itsgrowth so that the economy may generate

employmentfor the youth of India.

Government statistics state thatwe need to create ten million jobs each yearbut the employment laws are a seriousimpediment, leading to a jobless growththrough robotics, automation andinformation technology interventions, asalso due to a focus on financial and otherservices i.e. service sector. Hence, we needto recognize that in a competitive businessenvironment where the market is the entireglobe, enterprises will necessarily need togo through restructuring to prevent themfrom becoming sick. At the same time,certain enterprises that either become sickor are unviable or for whatever reason, atthe entire discretion of theemployer/management, need to be closed;Chapter V B of the Industrial Disputes Act,1947, is a deterrent and a seriousimpediment. The reality of this world isthat life and death are two sides of the samecoin that is universally applicable toindustry, business and human resource.Hence, the unnecessary desire to protectindustry from closure is meaningless,especially in a market driven economy suchas India, when the Government'scontribution in setting up industry isneither mandatory nor guaranteed, whyshould there be obstacles on closure?

Business is not a straight line graph;there are continuous growth curves.Enterprises, in their life-cycle, need to berestructured with reference to variousresources including product portfolio -supply, manufacturing, distribution processand also people. The existing IndustrialDisputes Act of 1947 becomes a hindrance;to illustrate, Section 9 A mandates theemployer to issue a notice of change, whichregrettably, always culminates in anindustrial dispute, thereby making itimpossible for the employer to bring ininnovation or even to right-size theorganization. We need to keep pace withchanges in the economic and businessenvironment, keeping in view internationalnorms and standards; this is only possible ifthe existing labour laws are reviewed withthe basic premise and on the touchstone of -what is best for India?

Labour reforms need to be addressed from national perspective

Business is not astraight line graph;there are continuousgrowth curves.Enterprises, in theirlife-cycle, need to berestructured withreference to variousresources includingproduct portfolio -supply,manufacturing,distribution processand also people.

BM


Cover Feature

Introduction The BhartiyaJanta Party (BJP) was the

main constituent of the NationalDemocratic Alliance (NDA) Governmentwhen they set up the Second NationalCommission on Labour on 15 October 1999with the following Terms of Reference:

(i) To suggest rationalization of existinglaws to labour in the organized sector; and

(ii) To suggest an "umbrella" legislationfor ensuring a minimum level of protectionto the workers in the unorganized sector.

The Commission's report released inSeptember 2002 dealt in detail with theopinions it received from Academicians,Labour Lawyers, Trade Unions, EmployerOrganizations, Professional Bodies andNGOs. However the then NDA Governmentdid not implement the report, except forintroducing provisions of Fixed TermContract (FTC) of employment.

NDA Government should consider certainparts of the Second National Commissionon Labour Report for implementation

Time to implementlabur commission’s

recommendations

Time to implementlabur commission’s

recommendations

Dr. Rajen Mehrotra

President, Industrial Relations Institute of India (IRII),Former Sr. Specialist on Employers' Activities,

South Asia with (ILO)

Time to implement labur commission’s recommendations



The setting up of the Second NationalCommission on Labourin 1999 by the then NDAGovernment is a clear indication that there was aneed felt way back in 1999 for labour reforms, both inthe organized as well as the unorganized sector, butthe coalition politics of running a Government tillend May 2014constrained either the earlier NDA orthe United Progressive Alliance (UPA) to comeforward with any labour reforms, except for raisingthe limits of coverage in the social legislations andthe Bonus Act.

The present Labour Minister Narendra SinghTomar of the NDA Government, since assumingoffice has had meetings with the labour ministers/ labour secretaries of the state Governments andalso with the Employers' Organizations and TradeUnions seeking their suggestions on the desiredreforms to the existing labour laws and also stepsfor effective implementation.The NDAGovernment in end of July 2014 has informed ofcertain changes that they plan bringing withrespect to the Factories Act, involving. (i)amending the Actrelating to permission foremployment of women for night work withsafeguards for safety and provision of transporttill their doorsteps of residence,(ii)enhancing thelimit of overtime hours per quarter from 50 to 100,(iii)insertion of provisions for compounding ofcertain offences, (iv)provision of self-certificationfor expansion of factories , (v)provision of canteenfacilities in respect of factories employing 200 ormore workers from 250 and (vi)reduction ineligibility criteria for entitlement of annual leavewith wages from 240 to 90 days.

The BJP party which assumed office in end May2014 is the main constituent of the NationalDemocratic Alliance (NDA) Government and isalso having a clear majority in parliament; hencethere are expectations that it will take decisions onintroducing labour reforms both in the formal andthe informal sector which will benefit employers andemployees.

Since the BJP has a clear majority, the NDAGovernment should consider certain parts of theSecond National Commission on Labour Report forimplementation, as the BJP during its electioncampaign talked of focusing on "job rich growth"through a development model aimed at ensuring ahealthy climate for industrial stability, growth, andgenerating jobs for the youth of the country.

Reforms in Labour Laws for theOrganized Sector

Our major concern today should be toundertake the activity of massive skill acquisitionand up gradation programmes for the youth tobecome a skilled workforce which is a pre-requisitefor the achievement of the country's desired rapidand inclusive growth. The United ProgressiveAlliance (UPA) Government had aimed to skill 50million people by the end of the 12th Five YearPlan. This target is worth maintaining and makingall out efforts at achieving. Also the PrimeMinister Narendra Modi has said we need Skill,Scale and Speed. The present Government isworking in bringing forward amendments to TheApprentices Act, 1961, so that enterprises can

facilitate in ensuring increase number ofyoungsters entering the labour market beingtrained. It is time that the NDA Government afterlistening to the views of all the stakeholders takesa decision and goes ahead in implementingreforms in labour laws, reporting systems andespecially on inspections. There is an urgent needto ensure that the present practice of grantingpermissions as well as inspection by the labourdepartment is transparent. The present practice ofthe inspection machinery of the Labourdepartment of giving veiled threats of prosecutionto owners / managers of enterprises for any failure/ deviation on compliance of labour laws needs tochange towards an approach of education tofacilitate compliance.

The Government has said that it is prepared totake tough decisions in the interest of the country;hence it needs to look at specific areas of reformsin labour laws. There is need to ensure that all thepersons engaged in the organized sector arecovered under the social legislation ensuringbenefits of paid leave, provident fund, pension,health care, treatment and adequate compensationin the event of an accident. The micro, small &medium enterprises who by and large employ lessthan 50 workers, need to have a simple compositelabour law including coverage of social legislation,which would be easier for enterprises to operateand grow at the same time safe guarding theinterest of the workers .

Quite often the existing ID Act, at times doesbecome a hindrance, because of some of the ageold provisions under Section 9A which have notkept pace with changes in the economic andbusiness environment after the Indian economyopened up in 1991.

Also there is need to review the existing labourlaw for unviable enterprises, as they cannotcontinue to live in a state of comatose, because thelabour department of most state governmentsrefuse to grant permission for lay off, retrenchmentand closure when the enterprise is employing morethan 100 workers.

The Second National Commission on Labour hadrecommended that employees earning more than Rs.25,000/- per month salary will be non-workers (NBThis figure could be revised considering inflation.There is a need to get the gold colored workers outfrom the coverage of the Industrial Disputes Act).This category of gold collar workers earning afairly high monthly salary , quite often use powerplay tactics as a collective tool during wagenegotiations to get more and the appropriategovernment many times is a silent spectator.

The First National Commission on Labour'sreport which was submitted in 1969 was notimplemented. The Second National Commissionon Labour's report has also not been implementedto date. It is hoped that the Government does notappoint a Third National Commission on Labourand await its report for implementing labourreforms. The labour laws should also not beunfavorable to the labour force, but it cannot besuch that managements of enterprises are held toransom by politically interested external tradeunion leaders.

It is time thatthe NDAGovernmentafter listening tothe views of allthe stakeholderstakes a decisionand goes aheadin implementingreforms in labourlaws, reportingsystems andespecially oninspections.

BM

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Cover Feature

Globalization of the world economyand subsequent liberalization ofIndian economy in 1991, there is anincreasing demand from theindustry for reforming archaic

labour legislation in order to gain and sustaincompetitiveness amidst global competition.This has assumed significant importance inthe context of VUCA regime and furtherfuelled by the announcement of newgovernment's intention to reform labourlegislation. However, the problem is that

reforming labour legislation is a very touchyissue and there are conflicting interest groupsinvolved, which has resulted in lack ofinitiative of the government to make necessaryamendments. At the same time, internationalconcern over fundamental human rights atwork and the existence of dangerous workingconditions has intensified. Literature reviewreveals that there are no studies on reformingworking conditions regulations especially oncompetitive advantage as traditionally thefocus has been on 'employment relations'

There are no studies on reforming working conditions regulations especially on competitive

advantage as traditionally the focus has been on 'employment relations' rather than 'conditions

of work' inspite of the fact that employees spend 80% of their waking life at their workplace.

Workingconditions

regulationsshould

haveuniformity

Dr.Tapomoy Deb

General Manager-HR, Lakshmi Cement (JK Group)

Working conditions regulations should have uniformity



rather than 'conditions of work' inspite of the fact thatemployees spend 80% of their waking life at their workplace.Reforming labour legislation on working conditions hasemerged from the confluence of a number of fast-emergingchanges in technology, trade, tariffs and investment flows,product cycles, and cost and scale of production throughinnovation and R&D, which India cannot ignore. For Indianfirms to acquire and/or sustain competitive advantage, archaic,dysfunctional and restrictive labour legislation on workingconditions needs to be rationalized in order to facilitateintegration of Indian business into the global economy foraccelerated industrial growth, prosperity and general wellbeing of the stakeholder's viz. Workers, Industry, Society andthe Government/Nation.

In a recent research on the subject in NCT of Delhi by theauthor, the views of trade unions, employer's associations,government and practitioners through secondary sources wereexamined before finalizing the research questions. Acomprehensive overview of current literature, which is inter-disciplinary in nature, was conducted to generate importanttheoretical constructs on working condition regulations andcompetitive advantage. The study relied upon primary data andwas collected through questionnaire, interview guide,discussions and observations. Purposive random sampling wasemployed. For the survey method, the sample size was 338respondents, consisting of 291 workers of 13 different factoriesin pharmaceutical, textiles, beverages, refrigeration and air-conditioning, consumer, confectionary, auto-components andengineering products, 82 call centre agents from a leading CallCentre company, 5 office bearers of five national federation oftrade unions, 25 state-level trade unions, 1 national-level callcentre employees union, 11 business associations, 4 personnelof Factory Inspectorate and 1 personnel of Shop &Establishment Inspectorate of Government of NCT of Delhi.SPSS software using statistical tools like mean, standarddeviation, t-test, coefficient of correlation, and chi-square testwere utilized.

It was found that workers and call centre agents belonging tonew economy industry have better perception than oldeconomy industry on working conditions. Both trade unionsand business associations perceive that working conditionregulations have been partially successful in protecting theinterest of workers, trade unions and management. Tradeunions perceive that all stakeholders are satisfied whilebusiness association finds lack of proper understanding on thesignificance of working condition amongst all stakeholders to

Fin

din

gs

Workers and call centreagents belonging to neweconomy industry have

better perception than oldeconomy industry onworking conditions

Trade unions and business associationsperceive that working

condition regulations havebeen partially successful inprotecting the interest ofworkers, trade unions and

management

While trade unionswant more stringency

while businessassociations want

rationalization.

Trade unions perceive that allstakeholders are satisfied whilebusiness association finds lack

of proper understanding on thesignificance of workingcondition amongst all

stakeholders to be reasonbehind lower number ofcourt/adjudication cases

Trade unions and businessassociation's favour reforming

working conditions regulationsalbeit for contrasting reasons.

Working conditionregulations is not an

impediment in attaining orsustaining competitive

advantage by firms

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be reason behind lower number ofcourt/adjudication cases. Both trade unions andbusiness association's favour reforming workingconditions regulations albeit for contrastingreasons. While trade unions want morestringency while business associations wantrationalization.

Labour department points out that most of theemployers in organized sectors are complyingwith working conditions. The inspectoratestrongly advocates for deletion of minimumstipulation of 10 workers under section 2 (m) ofthe Factories Act, 1948. The number of factoryinspectors is much lesser than the number offactories (1: 615 for organized sector and 1:1231 forboth organized & unorganized sectors). Theshops and establishment inspectorate contendsthat lack of registration has adversely affectedthe effective implementation of the Delhi Shopsand Establishment Act of 1954. The Inspectoratesstrongly believes that working conditionregulations is not an impediment in attaining orsustaining competitive advantage by firms.Judiciary has one of the major roles to play ininterpreting legal provisions in wider terms notonly for the benefit of workers, but also industryas a whole.

Workers should insofar as possible work insitting position. Workers must have positiveattitude towards statutory inspections as audit ofworking conditions as they stand to gain. Theirneeds, aspiration and requirements must befulfilled by appropriately reforming workingcondition regulations. In this globallycompetitive era, unions/employers need to shiftfrom 'conflict' to 'cooperation' for improvingproductivity and competitiveness of workforceand eventually firms. Business associationsshould themselves act as regulatory body fortheir members so that employers are persuadedto improve working conditions by uploadingcompliance report on website (self-disclosure).

Firms found complying with workingcondition regulations at the time of grant oflicense or having ISO/TS16949/GMP etc.certifications should be granted immunity fromfurther inspections for three years. CentralFactory Rules must be formulated in order tobring uniformity and simplicity in procedure,process and documentation.

The law making bodies has crucial role inbalancing equity with efficiency. Workingcondition regulations must be amended toremove obsolete and dysfunctional provisionswhich serve purpose of none of the stakeholders.Vibration and stress must be recognized as healthand safety hazard. Working conditions of callcentres must be governed by IT Act, 2000. Audit ofworking conditions must be laid down in thestatute book which shall be conducted by areputed, independent and specialized body.Welfare/Safety Officers should be designated asResident Factory Inspector and they shall uploadcompliance report on website of labourdepartment. The working condition regulationsmust contain a provision that it needs to becompletely reviewed after every 10 years. BM

The Human Resources Management has a widescope of activities under its belt. Ensuringlabour statutory compliance is one key area.The compliance activities may appear easy butit has lot of complications. Among many, one

reason which is commonly attributable for the complexityis the fact that the subject 'labour' as well as 'social security'fall under the concurrent List of the Constitutiontherebygiving both Central as well as various State Governmentspowers to legislate and hence the provisions / proceduresvary from one state to another.

Flurry of labour laws :There are umpteen number of labour laws, around 45

central and more than 125 state legislations which governthe field of labour and employment. Determining theapplicability of each of these laws itself is difficult. The

The complexitiesin Labour

Legislations

It is a challenge for the employers to keepthemselves abreast of the latest

pronouncements and understanding the realimport of the judgements.

K.Varadan

Chief Operating Officer, Factory Compliance & Consultation & Audit,Aparajitha Corporate Services

Cover Feature

The complexities in Labour Legislations



applicability depends on the number of workers inone case; it depends on the nature of industry inanother case; in the third case it depends on thelocation of the establishment and it's a combinationof more than one of these factors in the last case.The applicability is thus not just based on onecommon factor/s.

Multiple documents / laws talkingabout the service conditions :

The Industrial Employment ( Standing Orders )Act, 1946 and the governing legislations in general,like, the Factories Act or the Shops andEstablishments Act or the Mines Act or etc. will talkabout the service conditions like the working hours,the weekly holidays, the rest interval, leave, etc. Inaddition, some of the documents like the Contract ofEmployment and the Long Term Settlement betweenthe Management and the Trade Unions will alsohave some of the conditions of service incorporatedin it. When the same matter ( service condition ) isdealt with in more than one of these records / laws,the employers have to ensure that there are nocontradictions. Otherwise, it will be difficult toarrive at a decision as to which one would prevail ?

Coming to some specifics, the opening and closinghours for a shop and a factory in the same locationwould vary. It would further be different among thestates. Thus, the opening and closing hours, for acommercial establishmentor for that matter for anytype of establishment could vary from State to State.Same is the case with the other service conditionstoo. Hence, if a company has operations in morethan one state, it will be difficult for the Managementto have a uniform set of service conditions. Or thecompany needs to have some compromise.

Same term - different meaning:The allowances are considered as part of the

salary under some laws whereas it may not be sounder another group of laws. Similarly, managersand supervisors may be considered as employees forcertain legislations but the position may be differentfor certain other laws. Same is the position withrespect to contract workers too. In a nutshell, theterms salary, employee, appropriate Government,establishment, etc will not have the same meaningfor the purposes of all the applicable labour laws.

Impact of judicial pronouncements :Another important aspect in compliance is the

judicial interpretation. The legislature is the lawmaking body; the executive is the law implementingbody and the judiciary is considered the watch-dog.Wherever more than one interpretation is possible,the judiciary will give clarity. The judgment will bein favour of that interpretation which will furtherthe object of the Act. That judgment will remain aslaw till such time it is over ruled by anotherjudgment of the same court or a higher court.

The Bombay High Court in Hindustan LeverEmployees Union Vs Regional Provident FundCommissioner and Another, 1995 (2) LLJ 279 ruledthat the payment made towards 'leave encashment'will fall under the definition of 'basic wages' as thesaid term is defined in the Employees' Provident

Funds & Miscellaneous Provisions Act. TheKarnataka High Court also in Manipal Academy ofHigher Education Vs Provident Fund Commissioner,Mangaloreand Another, 2004 LLR 321 gave a similarverdict. As a result, 'leave encashment' was treatedas a part of 'basic wages' and was reckoned for PFcontributions. In 2007, the Madurai Bench ofMadras High Court gave a different ruling in ThiruArooran Sugar Limited and Others Vs APFC,whereby it said that the payment towards 'leaveencashment' is not a part of 'basic wage' and PFcontributions need not be made on the same.Subsequently, in 2008, in Manipal Academy case, theSupreme Court settled the issue by saying that 'leaveencashment' will not form part of 'basic wage'. Theunderstanding the practitioners had, earlier,regarding the payment of PF contributions on 'leaveencashment' was changed subsequent to thejudgment of Bombay High Court in 2005. TheKarnataka High Court also asserted the stand takenby the Bombay High Court. But this was reversed bythe Madurai Bench of Madras High Court in 2007and subsequently by the Supreme Court in ManipalAcademy case in 2008. So, currently, the legalposition is that PF contributions need not be madeon the payment towards 'leave encashment'.

It is a challenge for the employers to keepthemselves abreast of the latest pronouncementsand understanding the real import of the judgement.

"The Inspector Raj' :Another uphill task faced by the employers is

managing the inspections. With the advancement oftechnology, the companies as well as the individualsmaintain, in electronic format, the records whichthey ought to maintain. This is also lawful as theInformation Technology Act permits maintenanceof records in the electronic form. Unfortunately,some of the labour enforcement authorities do notaccept this and still insist the employers to maintainrecords manually. At times, the enforcementauthorities suggest their own procedure whichmakes the process of compliance cumbersome.

Conclusion :At this backdrop, larger corporate entities demand

for simplification of existing labour laws whereas, theSmall and Medium Enterprises advocate for acommon code integrating provisions on businessStart-up, maintenance& closure, discipline, women,children and adolescents in employment,workingconditions, compensation, social security, capacitybuilding and skill development.

Constitution of a task force comprising ofemployers, employees and central and stateGovernment officials to further deliberate on thesecomponents and workout specific details to draft thecommon code, triangulation of specific details withkey stake-holders and finalization of the draftproposal, submission of the draft proposal toMinistry of Labour & Employment towards draftingof a Bill to be tabled at parliament, influencinglegislators, moulding public opinion throughlobbying, nation-wide consultations & media leadingtowards ensuring enactment of common code withrules are suggested as way forward initiatives.

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BM



Cover Feature

The Trade unions Act enacted in 1926was brought on statute book incolonial period during which ourfocus was on strengthening workersto fight against industrial atrocities.

The view on industrial development wasdifferent from what is being propagated now.

The Act which is about 88 years old hasseen only seven amendments and lastamendment was thirteen years back. Mostalike countries have modified the statute tosuit the changing conditions but somehow wecould not gather political courage to do so. Ourcountry in changing economic conditions alsoneed such changes in the Act so that bothemployers’ and workers’ rights are balancedwhich legalizes the formation of trade unions.

There are few issues which have beenboggling the minds of employers, unions andsocial scientists. Where employers’ view is thatunionism hurts labour interest as well asindustry due to inadequate legislation on thesubject, workers’ unions say that employerssystematically dis-regard the existing TradeUnions Act. The workers who attempt to form atrade union are victimized. On getting any hintof unionisation efforts, such workers areterminated from service. Managementmanages to get time to delay the registration

There can be provisions in the lawdefining rights and liablities of bothemployer and workers/ union withacceptance of each-other’s domain,authority and limitation.

Can lawmakes Unionsresponsible &transparent?

Trade Unions Act

B.S.Dagar

General Manager – ER & Corporate Affairs,Relaxo Footwears Ltd.



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process so that efforts of the workers are foiled byvictimization of workers. The present law on tradeunion is full of gaps responsible for generatingtension and mistrust between employer andworkers. Our law allows outsiders to be the officebearers and members of unions. Workers who arenot directly employed in a particular industry anddo not understand the business and operationalintricacies, also stand against the employer in thedispute and sit in the negotiations.

The idea of outsiders intervening in disputesand collective barganing between workers andemployer does not exist in other countries. InSingapore while trade union rules aim atenhancing productivity and economic growth, ourrules restrict the same. Our rules also do notenforce democracy among trade unions which leadsto inexplicable behaviour of office bearers.Countries like UK and Japan follow a democraticway of electing their members through a process ofsecret ballot, whereas we have no such uniform lawon the point. The employers’ bodies have beenconstantly reminding the Government of the needto discourage the multiplicity of the unions andenforcing the principle of one industry-one union.Of late, Government has partially amended the Act13 years back (in 2001) thereby making theprovision of minimum of 10% or 100, (whichever islesser) of membership of workers compulsory forregistration of union. Out of which one-third orfive officers whichever is less are permited to beoutsiders in the inudstry. It has not resolved theproblem of multiplicity of unions in an industry,though did see some immediate outcomes but not tothe extent as excepted.

Multiplicity of unions in an industry resultsinto union rivarly and politics of self interestthereby affecting industrial harmony. The countrylike Bangladesh has reformed the law in 2006 bymaking a minimum membership of 30% of workerscompulsory to form trade union. Pakistan’s law asamemded in 2012 stipulates that at least 20% ofworkmen should be members of a union to beentitled for the union to be registered. It will not beirrelevant to state that it has been at the back of themind of Government that unions may not be goodenough to support and maintain discipline inorganisation that’s why the police and the armedforces do not have the right to form a trade union.In the state of Sikkim, registration of trade unionsis subject to a police enquiry and requires thepermission of the state’s land revenue department.One negative comment by the police about amember of unions executive can be a ground forrefusing registration. Any one in the general publiccan make an objection against the registration of aparticular trade union which will also prevent itsregistration.

The reforms in this direction should be to ensureeconomic growth, reduce multplicity, protectworkers from victimisation and exploitation andpromote internal democracy in the industry andthe unions. The question is how we can achieve allthat? The answer would be that Trade Unions Actshould be separated from industrial workers

unions. The Act should be replaced may be with thename, “The Industrial Workers Unions Act”.

The law should incorporate transparent processand system of registration of union, cancelation ofregistration, recognition of union, protection tooffice bearers from victimisation, one industry-oneunion and collective barganing with one union onlyetc. There should be at least 30% of workers of anyestablishment as minimum members of union to beproposed for registration. Third party contractworkers and trainees/learners/ apprentices shouldbe kept out of membership of the union of thatestablishment. One establishment can have onlyone union. As and when workers apply forregistration of union, an opportunity of hearingshould be provided to the employer of thatestablishment by giving him a notice to know hisviews and verification of workers claim. It willmake the process transparent as it is provided inthe Industrial Employment (S.O.) Act. When theemployer apply for certification of Standing Ordersto be made applicable on workers, notice is issued toworkers and they are given an opportunity ofhearing. In the same way the process should beadopted for registration of union. After all, theproposed union is going to affect the goverance andadministrative policies of the establishment intimes to come. There may be one check. Theemployer can be restrained from terminating theservices of office bearers of the proposed union andif there are any compelling circumstances for theemployer to take action against such office bearers,such action should be subject to scrutiny by theregistrar of trade unions.

Registration should be done only after hearingthe employer. Registration as well as cacellationparameters should be strong and transparent. Assoon as the registration is granted to the union, therecognition has to be automatic for thatestablishment. There should be no problem toemployer as he has already been heard. In thisprocess, lot of corruption and victimisation will beminimized. It will also promote participation ofworkers and management and enhance the trustbuilding process. There can be provisions in the lawdefining rights and liablities of both employer andworkers/ union with acceptance of each-other’sdomain, authority and limitation. The law can alsoincorporate the provisions about collectivebargaining process which should be limited to onlyfinancial benefits. The direct action by union likeStrike, Go-slow, and Dharna should haveconcurrence of two-third majority of workerswhich should be obtained by secret ballot. The lawcan have provision of cancellation/de-registrationof union in case of Illegal Strike, Go-slow, Dharna,contravention of settlement, damage to businessproperty, violence, commision of any offence underIPC etc. On the above lines if new law of unions forindustrial workers is created, it will not onlystrengthen the right of workers to bargaincollectively but also enhance trust among employers.After all both have to give something to other andmake the bridge of trust and confidence.

(Views are personal) (With inputs from BM Research team )

Can law makes Unions responsible & transparent?

The idea ofoutsidersintervening indisputes andcollectivebarganingbetweenworkers andemployerdoes not existin othercountries.

BM



Cover Feature

Contract Labour ActThe system of contractlabour was silently

accepted by thepermanent unionised

workforce of theindustry to shift the

productivity andenhanced production

pressure on contractualworkers at low cost.

Remove theAmbiguities

With the restrictive provisions of Industrial DisputesAct in respect of retrenchment and lay off, anotherform of employment of workers had emerged onthe industrial scene during 1960s in which

workers are not hired directly by the establishment/industrybut engaged through third party i.e. contractor. Productionand other activities are carried out by this segment of labourcalled contract labour in the establishment.This arrangementstarted becoming important during 1960s and 1970s whenlabour union aggression was rampant and industries werefighting for productivity norms during wage settlements. Thesystem of contract labour was silently accepted by thepermanent unionised workforce of the industry to shift theproductivity and enhanced production pressure oncontractual workers at low cost. It was sort of blessing indisguise for industries at that time which slowly -slowly eatenup the major employment share of permanent workmen inthe industry.

Since the practice of engaging workers throughcontractors increased with no social security obligations andfinancial compensation at the time of separation, Gov.enactedContract Labour Act in 1970. This law never intended toprohibit the employment through third party rather itlegalized the contract labour employment in the organizedsector. The Act only intends to regulate the contract labourand abolish in certain circumstances. Probably, the only lawone can find which is employer and employee friendly.The Acthas many gaps and loopholes which are exploited by both asper their convenience. The gaps have been left intentionallyprobably due to the reason that the Govt. is the biggestemployer of contract labour in PSUs and other sector.

There has been round of different voices about scrappingof this law.The scarping will only do injustice to employer andemployees as a whole. What is required is to make effectivechanges to set it right. The Act talks of abolition of contractlabour in perennial nature of work but what would be“perennial nature of work” has no where defined in the Act. Itshould be defined well to remove this ambiguity.

There is no clarity about core and non-core activities. Itshould be defined well like A.P. Govt. has defined it in the Actthrough state amendment. It has put many activities out of



core services thus allowing greaternumber of contract labour in all industries.It has also done away with the institutionalmechanism to decide on abolition ofcontract labour, thus leaving it togovernment officials to decide on thematter. While State of U.P. still has theprohibition of engagement of contractlabour in Engineering Industry except onenamed unit, many other states haveincorporated the significant changes tomake use of contract labour easier.The Actshould clearly spell what is not allowedand what is. Since contract labour ingoverned through this legislation, thereshould be proper mechanism for redresalof grievances of this category of workers.They should not be mingled up with on rollregular employees of principal employer.Since this segment of employees does nothave job security, they should be paidhigher than minimum wages to meet outexigencies. State of Karnataka has recentlydeclared separate rate of minimum wagesfor the category "Contract workers" whichis higher than other scheduledemployments. At present, this segment ofemployees are neither paid equal toregular employees though doing the sameand similar kind of work nor have the jobsecurity. While the contractor who is theemployer of such workers should be maderesponsible clearly and specifically interms of industrial disputes and principalemployer should be kept out of purview ofsuch third party disputes.

While the employer is allowed toengage contract labour on variousprocesses and activities, there should beclarity in law that at the same timeemployer should not be allowed, using thissegment as a low cost tool. No one shouldget both- flexibility as well as lost cost manpower. Law never intends this .The law ofpaying equal wages to contractualemployees through third party has beenviolated by contractors as well asemployers in the name of low cost. As aresult the extent of contract labour inorganized manufacturing sector hasincreased to about 50 %. This fastlygrowing segment of workers needs to beprovided protection in respect ofadequate wages, working and serviceconditions, social security with equalwages and other benefits for same andsimilar nature of work. These specificprovisions should get place in the Act.While streamlining the labour reforms,Govt should look into these anomalies ofthis piece of legislation.

ID ActThere are manyamendments in

the Act lyingunenforceable

since last threedecades . Had it

been done intime,that would

have broughteffective and

desired impactin the right

direction.

Fromdisputes toharmony

The birth of IndustrialDisputes Act in 1947came with the idea toprotect the employmentof weaker section in

society and have stateintervention in case of disputesbetween employer and workmanwith the objectives to resolve andmaintain industrial peace. Prior toIndustrial Disputes Act, thedisputes were being settledunder Trade Disputes Act 1929.The experience with that Actrevealed certain defects so thislaw came into being. The presentI.D.Act has been amended 35times during this period of 67years with a view to adopt acomprehensive measure toimprove industrial relations butresulted in to more litigations,strikes, lock outs and labourunrest. The reason behind thewhole concept has been toprovide more protection toemployees with investigation andsettlement of industrial disputes,but unfortunately it was given atthe cost of discipline andproductivity. Amendments afteramendments only provided morejob security to workers andreduced the ways for employersto effect separation even in thecircumstances and conditionsbeyond their control. It has been

generally said that easy toemploy but impossible to severethe employer-employeerelationship. The court decisionsduring the era of 1970-80enlarged the definition ofindustry thus covering allpossible activities from temple totrade. In an effort to provide jobsecurity, it created imbalancebetween rights and duties. Theprovisions of the Act has virtuallytaken away the right to managethe industry from employers. TheAct is applicable on almost eachactivity except specificallymentioned in the definition ofindustry in the Act.The Act hasvirtually made it impossible todiscipline and terminate theworkers.

It is evident from the pastexperience that the respectiveGovts. have displayed lack ofpolitical will and courage to setthe legislation in right directionwith changing times.For examplethere are many amendments inthe Act lying unenforceable sincelast three decades . Had it beendone in time,that would havebrought effective and desiredimpact in the right direction. Theamended definition of industrywas brought on book in 1984. Itwas done after the supreme courtjudgment in Bangalore water

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BM(BM Research Team)

From disputes to harmony



Cover Feature

supply case. Even the supreme court has observed many timesin different cases that interpretation of definition of industry asin the Act should be reviewed. Had the amended definitionbeen enforced at that time only along with other amendments,lot of litigations and disputes would have reduced. Still tomake it effective, no much efforts are required. Only one linenotification of enforcement is required.

Now, let us see the utility of few provisions and theirrelevance in present times:

The definition of workman is very wide leading to illogicalinterpretations. Due to this reason a pilot drawing lakhs ofrupees as salary and taking all important decisions at time offlying independently is deemed as workman under I.D.Actthus eligible to take all protections and benefits of the Actwhereas a simple manager or Accountant or law officer or HRmanager is not a workman. The definition needs to beamended keeping in mind the present working environment.

Works committee is there but proved to be dead letters as inpractice the committee has no powers . Neither it can act asrepresentative body of workers nor function independently,because union has its own interference in formation of workscommittee. Either the provision should be made powerful/effective or removed. The presence of grievance redressalmechanism also makes existence of works committeeirrelevant.

Though Conciliation machinery is provided with theobjective to resolve the disputes but virtually has no powers.Neither employers nor employees /unions are benefited fromthe present mechanism . The machinery should be clothedwith powers to exercise control and give directions to bothparties to behave and act in certain way during period ofconciliation and dispute. They should have some sort ofdecision making powers.

Board of conciliation and court of inquiry are ad-hocarrangement which are rarely put to use or constituted. Can bescraped conveniently.

The provisions realted to labour courts, Tribunals andnational tribunals have dysfunctionality of jurisdiction. Theprocedure laid down is time consuming. The disputesadjudication should be in the nature of summary proceedings.The huge list of pending cases are due to the reason thatappointment of Presiding officers are very selective. It can berelaxed. Apart from the the direct judiciary back ground, theofficers from labour department, advocates and labour lawexperts, and academicians with certain qualifications andexperience with requisite judicial mindset can also beappointed as officers of such courts being a special branch oflaw like in consumer and family disputes. It will help speedydisposal of disputes. Delay in disposal of such matters is one ofthe most crucial and important factor in industrial peace andlabour unrest.

Notice of change provisions have become out dated. Theexperience shows that it had jeopardized the restructuring andtechnological upgradation. Can be restructured or scrappedas it only creates unnecessary disputes .

Sec.9-C of grievance redressal mechanism is very good inintent but practically not put to use and enforced. No industrial

dispute should be entertained by the conciliation machineryunless sent/ forwarded by such internal machinary with theirconclusions. It will build pressure on both to resolve the disputequickly and maintain peace. On the other hand conciliationmachinery will be less burdened.

The present provisions related to reference of disputes byGovt. to courts clubbed with judicial interpretations have againlost its importance. Govt. should have enough powers todecide whether the matter should be referred as dispute foradjudication. Presently, the Govt. mechanically refer allcomplaints as disputes for adjudication due to fear of courtverdicts . It has made conciliation machinery less effective.Theprovision should be restructured to give more discretionarypowers to Govt.

As far as restriction of strike and lock out is concerned, It isonly limited to public utility services. The Govt. has put a caponly for those industries which fall under this category but thefact is that majority of industries fall outside this bracket thusleading to a possible situation of chaos in private sectorencouraging the unrest. The restriction should be same for allindustries. Supreme court supports it.

The most contentious chapter is VB which put restrictionson the right of employer to lay off, retrench the workers andclose the industry. The present environment of business doesnot at all require such restrictions. There are no concreteevidence that the period during which these provisions werenot on book saw worst business growth and industrial relationsand these provisions helped improve the situation.The chapterwas inserted originally during emergency period with 300employees number cap. That time conditions were different.Actually the chapter should have been deleted immediatelyafter end of emergency but was not done.Rather in 1984 it wasmade more stringent by reducing the limit to 100.Recently Raj.Govt.has passed the amendment in this respect and brought itto original limit of 300 employee cap.But these provisions havecreated the focus on extra job protection in place of jobcreation at the cost of disciple and productivity. If it has to beon the book for many reasons, then at least the limit should beof 1000 employees.

The provisions of Sec. 33 enabling the service conditions ofworkers to remain unchanged in certain conditions needrelook. The judicial pronouncements during the decades haveenlarged the area of coverage. For example if the dispute ofwage increase in referred to court for adjudication and thatmatter remains pending for years together, employer has toseek approval of termination in each case during all thisperiod of pendency of proceedings which seems to be difficultto operate the business and maintain discipline.

The inclusion of schedule of unfair labour practice has notbeen of much impact unless proper and effective procedure isprovided in law to make them effective as in Maharashtra.Absence of such detailed rules and procedure in this respect(Violation) makes the schedule teeth less.

Better labour relations can not be sourced from law but thelaw which is changed according to times encouragesconcerned to follow, comply and honour. Social acceptance forany law is of much value. (BM Research Team)BM

The Indian legal frameworkconsists of constitutionalmandates, about 45 differentCentral laws and in addition,State laws and rules, to protect

the interests of labour. The majority of labourlaws in India, originally drafted between 1930and 1970, were intended for manufacturingunits. However, past few decades havewitnessed a tremendous growth in the servicessector, especially business driven bytechnology. Often, labour legislation is seen asirrelevant for these highly-skilled, highly-paid'knowledge workers'.

Working conditionsSeveral studies have highlighted the

difficult employment conditions in this

industry. 'Decent work', as defined by ILO hasfour components: employment, social security,workers' rights, and social dialogue. However,workers in the IT/ITES sector face a number ofchallenges:

job insecurity due to project-specificcontracts; scarce options for collectivebargaining or action; tough working hoursincluding 'Graveyard' shifts; absence of socialsecurity features and stringent performancecontrol. As a result, employees have beenfound to suffer from psychological stress,emotional exhaustion and burnout, poor work-life balance and various occupational and life-style related ailments. Whilst the labourlegislation purports to address such aspects,there have been clear gaps between formal lawand practice in this sector.

Supriya Rakesh

Doctoral Student, OB HRM, IIM Bangalore, India



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Reforms should notrun the risk ofignoring ‘knowledgeworkers’ rights

workers in the IT/ITES sector face a number ofchallenges: job insecurity due to project-specific

contracts; scarce options for collective bargaining oraction; tough working hours including 'Graveyard'

shifts; absence of social security features andstringent performance control.

ApplicabilityMost of the legal protection applies only to

employees defined as 'workmen' which does notcover all categories of employees who face suchissues. For instance, the definition of 'workman' inIndustrial Disputes Act excludes any person who isemployed in a managerial or administrativecapacity or exercises managerial functions. InIT/ITES context, only employees hired for purelytechnical work (skilled or unskilled), or tasks ofclerical or repetitive nature are included. Differentlaws have different criteria for application, theextent of protection to IT/ITES workers dependsupon their status, location, wages, and conditionsunder which they work.

ExemptionsThere are also aspects of public policy- legal

exemptions have been provided to ITcompanies in multiplestates to

promoteeconomic growth through this

sector. Some legislation specifically exemptsIT/ITES workers from its coverage. For instance,Karnataka Shops and Establishments Act exemptssuch establishments from provisions mandatingopening hours and weekly closure, and fromprohibitions against night work for women andyoung people, subject to certain conditions.Various state IT policies also extend specialtreatment to 'knowledge industry' by allowing themto 'self-certify' their compliance (West Bengal), orinspections for labour compliance (Uttar Pradesh).In Karnataka, IT industry enjoyed a blanketexemption from the Industrial Employment(Standing Orders) Act, 1946 on the ground that itdoes not fit the requirements of a knowledge-basedindustry.

While such moves are seen as 'progressive' andreforms towards more flexible and business-friendly legislation; they run the risk of ignoringworker rights. For instance- exemption discussedwas finally revoked in response to campaigns byITEC, a support group for IT professionals; ITHI, aforum of women employees, and Karnataka StateWomen's Commission based on complaints received

regarding unreasonable termination, overtime orsexual harassment.

Absence of trade unionsAlthough, the IT/ITES workers are legally allowed

to form trade unions under the Trade Unions Act 1926,real protection for freedom of association isquestionable. The employers as well as the employerrepresentative NASSCOM have taken a negativestance on trade unions, claiming that they arepolitically oriented, counter-productive, unnecessaryand retrograde. Some associations such as CITU andUNITES have been established recently, but these arenot recognized by the employers and henceunable to negotiate terms ofemployment.

Industrycharacteristics

The features of the sector itself contribute to theill-effectiveness of current labour legislation, suchas its recent development and domination byprivate players, prevalence of short term andproject specific contracts, and the ready availabilityof alternative jobs. Due to high industry attrition,workers are not in employment long enough to gainentitlements to legal rights. With alternativeemployment opportunities, they may prefer tochange jobs rather than trying to enforce rightsagainst their employers.

ConclusionThere is much discussion on the need to

modernise labour laws and practices, in order toenhance competitiveness in a globalizingenvironment. The new Central Government hasalready initiated this project with theannouncement of first set of labour reforms toattract business investment. Whilst this isimportant, the laws and their implementation alsoneed to also be adapted to the characteristics andlabour market conditions of the technology sector.The reforms need to keep pace with developments,the atypical features and challenges of employmentin these sectors. Their protection needs to includeinterests of all kinds of workers, including the socalled 'knowledge workers'.

Reforms should not run the risk of ignoring ‘knowledge workers’ rights



Cover Feature

BM



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Cover Feature

COLU

MN

Rewards & Recognition

SIMRAN OBEROIHR Professional, Bangalore

Globalization has become the biggest words in the business andeconomic jargon in the past decade or more. However, while we speakabout it in a holistic and macro level context, often we do not replicate

this phenomenon into basic people processes such as Rewards. Indian MNCshave shown an increase in number as well as expanded their operations byacquisitions.The direct impact of this has been the absence or lack ofawareness on how to create a global rewards strategy.We are able to identifylocal compensation elements in any market that we operate in, look forcompensation benchmark data and identify what to pay for which role, interms of market competitiveness.What we are unable to do are the following -

1. Determine a global rewards approach that a diverse set of employeesunderstand and accept.

2. Drive a performance-oriented rewards strategy that includes the values andmotivation factors applicable to individuals in various markets.

3. Communicate the overall organizational rewards framework or philosophyparticularly the non-financial and intrinsic elements in a manner that allemployees believe in it.

There might be several other aspects of their global rewards approach thatIndian firms need to work on but the above three are primary in terms of theirimpact and application. Some steps to address this gap as Rewards practitionersare -

Gain deep and comprehensive insights into what different employees value -Our usual strategy of assessing monetary compensation against marketbenchmarks and applying it based on our pay percentile principles will not applywhen we talk about global rewards.This will encompass all aspects that formrewards as a basket whether those are related to any of these three Ps - peoplepractices, policies or processes. So as Rewards practitioners we need to gaugewhether our policies reflect our defined culture, our practices are linked to ourvalues and if our processes are designed to reward desired employee behaviours.Here are some examples for us to mull over - if being inclusive as a manager andteam member is a core organizational value does our reward & recognitionpractice demonstrate that? If we promote a culture of high performance do wehave suitable but unified policies across our locations which are bias-free andtransparently implemented in order to reward the right employees, in the rightway?

When we answer these questions, we get a little closer to understanding whatour diverse segment of employees want. Our role is not to create multiple rewardstructures and segmentize the organization - our role is to understand how tobalance similar and different motivators from a rewards perspective, for our variousgroups of employees and create a flexible and agile structure.

Keep informed about new Rewards tools / approaches are emerging - As Indianorganizations grow larger and establish their geographic footprint, there is a needfor the Rewards practitioners to be more cognizant, aware and attuned to newways and means of rewarding employees.Working with a robust existingframework is great, but being able to add to that in a manner that it makes theframework more future focused is imperative. Information flows at supersonicspeed today.Your employees will know of these new approaches possibly fasterthan you will, as they exchange ideas and thoughts with peers ( even virtually!)from across the world.Therefore such Rewards know-how will help you understandthe viability and feasibility of those approaches in your organization's context. Itwill also help you be better prepared in terms of managing a global workforce.

Invest time in drawing up effective communication of your overall rewards strategy- In Indian organizations, we overemphasize the financial elements of rewards andunderemphasize the intangibles. However, employees are increasingly focusing onthe latter to understand whether those elements fit in with their aspirations or not.Hence Rewards practitioners in these firms, need to understand the strengths of thissegment of their overall strategy and gain more from it. An excellent benefitsprogramme is as critical as a market competitive base pay structure. Similarly, anempowering work environment is extremely crucial in terms of retaining employees -these are the intangibles that the communication must focus on.

Global Rewards Strategy for Indianorganizations

Gain deep andcomprehensive

insights into whatdifferent employees

value - Our usualstrategy of assessing

monetarycompensation against

market benchmarksand applying it basedon our pay percentile

principles will notapply when we talk

about global rewards.


BM



24X7 pertains to the employeeengagement directly orindirectly. Everybody wantsuninterrupted services in everysector. At the global level, none

of the organizations or industries wants towaste a single second of their employees. Theywant them to be engaged 24/7 or at all times.

For any organization, manpower is thebiggest source of power. However, everyorganization wants that their workforce shouldbe productive and engaged at all times. Thequestion that arises here is what will be theimpact on employee life cycle with 24X7services conditions? How can the workingculture be improved for the employees andemployers?

There is no doubt that all organizationswant to enhance profits by keeping operationsfunctioning 27X7. While, employers endeavorthat their employees work 24X7 without anysocial life, employees demand hefty salaries inlieu of extended work hours from theemployers.

In the current work atmosphere, HRconcepts and functions are changing by the day,both at the global and domestic level in terms ofenvironment and social culture. We as humanbeings believe that change is a natural process.Employee life cycle is a thought process of jobdescription and key result areas are functionsof HR, which is aligned with goal setting andbalance score card and employees' life cycle.Therefore, it is important that employee lifecycle is improved in organizations for betterorganization culture and wellness.

The HR role is very specific and importantfor employees and the employer's life cycle.Whenever a company is set up in any sector, theHR's role in the business is critical. Absence ofan HR department can hamper theorganization greatly. Human Resource is thefirst key of any industry or ministry- fororganizational development or road map ofbusiness plan.

HR importance in employee life cycleAristotle once said, "Sound mind lives in

sound body". The first and last step of employeelife cycle i.e., Recruitment to Retirement, inbetween are learning and training,environment health safety, welfare activities,social and cultural programs, competent andresult oriented performance appraisal systemand ROI functions are key roles of the humanresource department. The need to work 24X7or24x6 for the continual development oforganizational development requires betteremployee life cycle. Maintenance is needed notonly for the machines but also for human life,just as a break is needed for an employee who isworking 24X7. It is easier to buy goodmachinery or a communication instrument butit is extremely challenging to retain humanassets.

The current scenario, personal and work lifeboth are being driven by informationtechnology such as Mobile, Laptop orComputer, Ipad. Employees are all the timeengaged with information technology productswithout any break, that's why employee lifecycle has been changed in behavior andattitude due to IT product being usedcontinuously anywhere and every time.Organizations and industries need to developand create a culture of employee life cycle forthe employees and organization development.

Employee Life Cycle directly affectsorganization goals and objectives. It is the roleof HR to take care of the employees by buildingthe life cycle culture. They HR function shouldclearly explain how the best practices of HRcan be aligned to various business processes.Thus it enables us to look at both from a microand macro view of the HR function and createfocused linkages between employee andemployer activities associated with theemployee's tenure in the organization fromrecruitment and retirement from an EmployeeLife Cycle point of view.

For an HR practitioner, this approach can be

Anand Kishor Goyal

Sr. Manager-HR & Admin. IL& FS, New Delhi

HR Role in Employee Life Cycle

Employee Life Cycledirectly affectsorganization goals andobjectives. It is the roleof HR to take care ofthe employees bybuilding the life cycleculture.

HR Role in Employee Life Cycle



a vital tool to determine the kind of inputs thatneed to be given to the employee based on the stagein the employee life cycle, to ensure his/ heroptimum performance, maintain motivationlevels and ensure that suitable developmentalinputs are given to the individual. Of course inlarger organizations, it might be difficult to giveindividualized attention and there invariablylarge scale systems driven initiatives would beuseful in creating or providing inputs to theemployees using an Employee Life Cycle. Hence,this is the right time to understand the better lifecycle of the employees, what is happening in theorganization with workforce, where is the currentwork culture of the organization standing, due tochanging of world economic and social condition,norms, nature, environment and also changing ofour thought process with evolving high techculture. Changing social and economic conditionshave changed the nature of work. Organizationshave high expectations from the employees interms of results and targets. If employees' lifecycle is disturbed or is on the track, then how it isimpossible to allow the organization andemployees to grow. Only employee retention basedupon best human resource policies and itsimplementation of HR best practices, proper KRA,PMS for the business plan is going to really workin this case, otherwise employees life cycle willremain incomplete in the organization.

Factors that affect the Life cycle approach are:

Nature of the industry Design od structure Recruitment/selection Induction Organizationgoal Development plan Individualperformance Review of salary Disciplineaction Resignation Review of exit

Why is Necessary Employee Exit Feedback?

As the diagram shows, exit feedback closes theloop on the employee life cycle. Although theemployee has left the organization their feedbackinformation can be used to improve the firststages of the employee life cycle. This canultimately lead to a more stable and engagedworkforce to drive performance goals and achieveorganizational objectives.

Why leaving: Why are you leaving- exit surveyquestions using an industrial psychological

Should CTC system be reviewed ?

Points to ponder1) If a company wants to recruit a

position in any function andshorlists 10 condidates withdifferent CTC's. Here the positionneeds same knowledge, and skillsand abilities. So why don't we offerthe same budgeted package to anycandidate selected irrespective ofhis present CTC.Why again botheredabout current CTC. ?

2) I have seen some public sectororganizations advts. In these advtsno where it is mentioned about thecurrent CTC. They only mentionabout the age,qualification andexperience required for theposition. They will offer the samepackage as per their gradeswhoever selected for the positionirrespective of their current CTC.This is really motivating tocandidates because they are judgedby their performace. Why not weimplement the same thing inprivate sector also ?

3) So many companies today aresaying they implementperformance management systemwhich encourages performance bydisproportionate rewards andincrements.Why not the same thingimplemented while recruiting also ?

The system has followingnegative Results1. Employees who have high

achievement motives and dreamswill be demotivated as they will get

increase based on their present CTC,irrespective of their performanceand continuously change their jobsfor higher salaries which will lead toless engagement inspite of all theengagement activities of thecompanies. This is the only solutionto private sector organizations toengage employees for a long termand increase loyalty.

2. The same age group andexperienced employees willcompare their knowledge and skillsto the peers in other companies andget dissatisfied.

3. Prospective candidates mayfabricate their present payscales inorder to get higher salaries.

4. Now a days so many companies aretalking about employeeengagement initiatives. But unlessone encourages healthycompetition of performancestarting from recruitment, turnoverwill continue to remain by chasingCTC's and not knowledge.

(Views are personal)

V. Sirinivas

construct validation technique which uses adaptive survey responsetechnology to increase the richness of feedback information. In the last onedecade, very high attrition rate of human assets due to life style and lifecycle is very deferent form current life cycle due to working environmentand culture without social security and work satisfaction.

As our life style is changing, we have to change employees life cycle asrequired to improve employee life cycle 24x7 and to give attention to theemployee life cycle. Only the HR department cannot help employeesthrough the life cycle tool as other functions of the business also need to becommitted and responsible to bring change in the life cycle. There is a needto establish a new life style- life cycle and which will help in enhancedefficiency of the employees, set a culture of life cycle and implement anobjective organization culture. BM

BM




GovernmentNotifications

Total Minimum Wages in Per Months (in Rs.)Sr. Name of the Scheduled Zone I Zone II Zone IIINo. Employment Basic Pay+Special Allowance= Basic Pay+Special Allowance= Basic Pay+Special Allowance=

Total Minimum Wages Total Minimum Wages Total Minimum Wages

1 Advocate and Attorney Special Allowance = 1876.00Skilled 9776.00 --- --- --- --- --- --- --- --- --- ---Semi-skilled 9076.00 --- --- --- --- --- --- --- --- --- ---Un-skilled 8576.00 --- --- --- --- --- --- --- --- --- ---

2 Automobile Repairing Special Allowance = 2800.00Skilled 8300.00 8000.00 7700.00Semi-skilled 7900.00 7600.00 7300.00Un-skilled 7600.00 7300.00 7000.00

3 Bakeries Special Allowance = 2913.75Skilled 8113.75 7913.75 7713.75Semi-skilled 7613.75 7413.75 7213.75Un-skilled 7113.75 6913.75 6713.75

4 Canteen & Clubs Special Allowance = 1652.00Skilled 9352.00 9052.00 8852.00Semi-skilled 8652.00 8352.00 8152.00Un-skilled 8152.00 7852.00 7652.00

5 Card Board Boxes Special Allowance = 2376.00Skilled 7026.00 6776.00 6526.00Semi-skilled 6776.00 6526.00 6276.00Un-skilled 6526.00 6276.00 6026.00

6 Cashew Processing Special Allowance = 2205.00Skilled 5205.00 --- --- --- --- --- --- --- --- --- ---Semi-skilled 5005.00 --- --- --- --- --- --- --- --- --- ---Un-skilled 4805.00 --- --- --- --- --- --- --- --- --- ---

7 Cement & Cement Based Industry Special Allowance = 3398.40Highly Skilled 5018.40 4888.40 4758.40Skilled 4758.40 4706.40 4680.40Semi-skilled 4680.40 4654.40 4602.40Un-skilled 4602.40 4550.40 4524.40

8 Cloth Dyeing & Printing Special Allowance = 2913.75Skilled 7813.75 7513.75 --- --- --- --- ---Semi-skilled 7313.75 7013.75 --- --- --- --- ---Un-skilled 7013.75 6713.75 --- --- --- --- ---

9 Construction of Roads/Buildings Special Allowance = 2094.50Skilled 7044.50 6844.50 6644.50Semi-skilled 6944.50 6744.50 6544.50Un-skilled 6844.50 6644.50 6344.50

10 Cotton Ginning & Pressing Special Allowance = 2625.00Skilled 7825.00 7625.00 7425.00Semi-skilled 7293.50 7125.00 6925.00Un-skilled 6825.00 6625.00 6425.00

11 Cycle Mechanic Works Shop Special Allowance = 2520.00Skilled 8020.00 7520.00 --- --- --- --- ---Semi-skilled 7520.00 7020.00 --- --- --- --- ---Un-skilled 7020.00 6520.00 --- --- --- --- ---

12 Dairy Special Allowance = 2750.00Skilled 8250.00 8000.00 7750.00Semi-skilled 7750.00 7500.00 7250.00Un-skilled 7250.00 7000.00 6750.00

13 Dispensary Special Allowance =2923.30Skilled 7583.30 7183.30 6683.30Semi-skilled 7483.30 7083.30 6583.30Un-skilled 7383.30 6983.30 6483.30

14 Drugs & Pharmaceuticals Special Allowance = 1652.00Skilled 9352.00 9052.00 8852.00Semi-skilled 8652.00 8352.00 8152.00Un-skilled 8152.00 7852.00 7652.00

15 Dyes & Chemicals Special Allowance = 2567.93Skilled 7367.93 6967.93 6367.93Semi-skilled 7067.93 6667.93 6067.93Un-skilled 6767.93 6367.93 5767.93

16 Eatable Tobacco Special Allowance = 2497.50Skilled 6197.50 --- --- --- --- --- --- --- --- --- ---Semi-skilled 5697.50 --- --- --- --- --- --- --- --- --- ---Un-skilled 5497.50 --- --- --- --- --- --- --- --- --- ---

17 Fountain Pens Special Allowance = 3116.50Skilled 8416.50 8216.50 --- --- --- --- ---Semi-skilled 8166.50 7966.50 --- --- --- --- ---Un-skilled 7916.50 7716.50 --- --- --- --- ---

18 Forest and Forestry Special Allowance = 2255.00Skilled 8255.00 7755.00 --- --- --- --- ---Semi-skilled 7855.00 7355.00 --- --- --- --- ---Un-skilled 7455.00 6955.00 --- --- --- --- ---

19 Film Production Studio Special Allowance = 2880.00Skilled 8580.00 8380.00 --- --- --- --- ---Semi-skilled 8080.00 7880.00 --- --- --- --- ---Un-skilled 7580.00 7380.00 --- --- --- --- ---

20 Glass Bulb Special Allowance = 1652.00*Skilled 5352.00 5202.00 4602.00Semi-skilled 5252.00 5202.00 4552.00Un-skilled 5202.00 5102.00 4502.00

REVISED MINIMUM RATES OF WAGES IN MAHARASHTRAThe Rates of Basic Pay & Special Allowances for the period 01.07.2014 to 31.12.2014




21 Glass Industry Special Allowance = 1652.00Skilled 9352.00 9052.00 8852.00Semi-skilled 8652.00 8352.00 8152.00Un-skilled 8152.00 7852.00 7652.00

22 Hair Cutting Saloon Special Allowance = 1652.00Skilled 9352.00 9052.00 8852.00Semi-skilled 8652.00 8352.00 8152.00Un-skilled 8152.00 7852.00 7652.00

23 Handloom Special Allowance = 2099.50Skilled 6099.50 6599.50 7099.50Semi-skilled 5599.50 6099.50 6599.50Un-skilled 5099.50 5599.50 6099.50

25 Hotel & Restaurants Special Allowance = 1652*Skilled 9352.00 9052.00 8852.00Semi-skilled 8652.00 8352.00 8152.00Un-skilled 8152.00 7852.00 7652.00

26 Ice & Cold Drinks Special Allowance = 2014.20Skilled 8014.20 7714.20 --- --- --- --- ---Semi-skilled 7514.20 7214.20 --- --- --- --- ---Un-skilled 7014.20 6714.20 --- --- --- --- ---

27 Laundry Special Allowance = 1652.00Skilled 9352.00 9052.00 8852.00Semi-skilled 8652.00 8352.00 8152.00Un-skilled 8152.00 7852.00 7652.00

28 Oil Mill Special Allowance = 2913.75Skilled 8213.75 7913.75 --- --- --- --- --- Semi-skilled 7713.75 7413.75 --- --- --- --- --- Un-skilled 7213.75 6913.75 --- --- --- --- ---

29 Optical Frames Special Allowance = 2592.00Skilled 8192.00 7992.00 7792.00Semi-skilled 7692.00 7492.00 7292.00Un-skilled 7192.00 6992.00 6792.00

30 Paints and Varnishes Special Allowance = 2921.45Skilled 6861.45 6663.30 6461.45Semi-skilled 6761.45 6563.30 6361.45Un-skilled 6661.45 6461.30 6261.45

31 Paper & Paper Board Special Allowance = 2357.50Skilled 8457.50 8257.50 8057.50Semi-skilled 7957.50 7757.50 7557.50Un-skilled 7457.50 7257.50 7057.50

32 Plastic Special Allowance = 2520.00Skilled 7820.00 7670.00 7520.00Semi-skilled 7320.00 7170.00 7020.00Un-skilled 6820.00 6670.00 6520.00

33 Poha/ Kurmura Special Allowance = 2913.75Skilled 7282.50 7082.50 --- --- --- --- ---Semi-skilled 7132.50 6932.50 --- --- --- --- --- Un-skilled 6682.50 6482.50 --- --- --- --- ---

34 Potteries (Matichi Bhandi) Special Allowance = 2173.60Skilled 6073.60 5923.60 5773.60Semi-skilled 5873.60 5723.60 5573.60Un-skilled 5673.60 5523.60 5373.60

35 Powerlooms Employees)Above 184/- Special Allowance = 6433.00Skilled - A 6733.00 6683.00 6633.00Skilled - B 6584.00 6653.00 4673.10Semi-skilled 6554.00 6623.00 4643.10Un-skilled 6544.00 4683.10 4633.10Manager 6664.00 6733.00 6683.00Accountant 6614.00 6683.00 6633.00Clerk 6564.00 6633.00 4653.10

36 Stable (Premises wherein Buffaloes or Special Allowance = 3137.20Cows are kept)Skilled 7037.20 6687.20 6310.80Semi-skilled 6737.20 6412.20 6060.80Un-skilled 6437.20 6137.20 5837.20

37 Public Motor Transport Special Allowance = 2913.75Skilled -A 8613.75 8413.75 --- --- --- --- ---Skilled - B 8413.75 8213.75 --- --- --- --- ---Skilled - C 8213.75 8013.75 --- --- --- --- ---Semi-skilled 7513.75 7313.75 --- --- --- --- --- Un-skilled 7113.75 6913.75 --- --- --- --- ---

38 Readymade Garments Special Allowance = 2913.30Skilled 7073.30 6973.30 6673.30Semi-skilled 6973.30 6873.30 6573.30Un-skilled 6873.30 6773.30 6473.30

39 Rice Flour or Dal Mill Special Allowance = 2913.75Skilled 7513.75 5355.50 --- --- --- --- --- Semi-skilled 7013.75 4855.50 --- --- --- --- --- Un-skilled 6713.75 4555.50 --- --- --- --- ---

40 Rubber Balloon Special Allowance = 2913.75Skilled 7213.75 7113.75 7013.75Semi-skilled 6982.25 6813.75 6713.75Un-skilled 6713.75 6613.75 6513.75

41 Rubber Industry Special Allowance = 1652.00Skilled 9352.00 9052.00 8852.00Semi-skilled 8652.00 8352.00 8152.00Un-skilled 8152.00 7852.00 7652.00






42 Seepz Special Allowance = 2466.20Skilled 8766.20 --- --- --- --- --- --- --- --- --- ---Semi-skilled 8266.20 --- --- --- --- --- --- --- --- --- ---Un-skilled 7766.20 --- --- --- --- --- --- --- --- --- ---

43 Shops & Commercial Special Allowance = 2214.00EstablishmentsSkilled 8014.00 7714.00 7414.00Semi-skilled 7614.00 7314.00 7014.00Un-skilled 7214.00 6914.00 6614.00

44 Silver Industry Special Allowance = 2640.00Skilled 8140.00 7840.00 --- --- --- --- ---Semi-skilled 7640.00 7440.00 --- --- --- --- ---Un-skilled 7140.00 6940.00 --- --- --- --- ---

45 Sweeper & Scavengers Special Allowance = 2625.00Full time 7225.00 7075.00 6925.00

46 Tanneries & Leather Special Allowance = 2923.30Skilled 6323.30 6123.30 5923.30Semi-skilled 6223.30 6023.30 5823.30Un-skilled 6123.30 5923.30 5723.30

47 Utensils Special Allowance = 2898.70Skilled 7398.70 7298.70 6998.70Semi-skilled 7298.70 7198.70 6898.70Un-skilled 7198.70 7098.70 6798.70

48 Gram Panchayat Special Allowance = 1475.00*Clerical Staff 3745.00 3545.00 3345.00Skilled 3745.00 3545.00 3345.00Semi-skilled 3645.00 3445.00 3245.00Un-skilled 3545.00 3345.00 3145.00

49 Watch Straps Special Allowance = 2913.75Skilled 8413.75 8113.75 7813.75Semi-skilled 8013.75 7713.75 7413.75Un-skilled 7713.75 7413.75 7113.75

50 Wooden Photo Frames Special Allowance = 1652.00*Skilled 4792.00 4592.00 4392.00Semi-skilled 4692.00 4492.00 4292.00Un-skilled 4592.00 4392.00 4192.00

51 Wooden Furniture Special Allowance = 1652.00*Skilled 5262.00 5162.00 5062.00Semi-skilled 5162.00 5062.00 4962.00Un-skilled 5062.00 4962.00 4862.00



A Bill further to amend the Factories Act, 1948 in itsapplication to the State of Rajasthan. Be it enacted by theRajasthan State Legislature in the Sixty-fifth Year of theRepublic of India, as follows:-

1. Short title, extent and commencement- (1) This Actmay be called the Factories (Rajasthan Amendment) Act,2014.

(2) It shall extend to the whole of State of Rajasthan.

(3) It shall come into force on and from the date of itspublication in the Official Gazatte.

2. Amendment of section 2, Central Act No. 63 of1948.- In section 2 of the Factories Act, 1948 (Central ActNo. 63 of 1948) in its application to the State of Rajasthan,hereinafter referred to as the principal Act,-

(i) in sub-clause (i) of clause (m), for the existing word"ten", the word "twenty" shall be substituted; and

(ii) in sub-clause (ii) of clause (m), for the existing word"twenty", the word "forty" shall be substituted.

3. Amendment of section 85, Central Act No. 63 of1948.- In clause (i) of sub-section (1) of section 85 of theprincipal Act, for the existing words "ten" and "twenty", thewords "twenty" and "forty" shall be substituted respectively.

4. Amendment of section 105, Central Act No. 63 of1948.- For the existing sub-section (1) of section 105 of the

principal Act, the following shall be substituted, namely:-

"(1) No Court shall take cognizance of any offence underthis Act except on complaint by an Inspector with theprevious sanction in writing by the State Government. ".

5. Insertion of new section 106B, Central Act No. 63of 1948.- After the existing section 106A and before theexisting section 107 of the principal Act, the following shallbe inserted, namely:-

"106B. Compounding of offences.- The Inspector may,subject to any general or special order of the StateGovernment in this behalf, compound any offencepunishable under this Act with fine only, and committed forthe first time, either before or after the institution of theprosecution, on realisation of such amount of compositionfee as he thinks fit not exceeding the maximum amount offine fixed for the offence; and where the offence is socompunded,-

(i) before the institution of the prosecution, the offendershall not be liable to prosecution, for such offence and shall,if in custody, be set at liberty;

(ii) after the institution of the prosecution thecomposition shall amount to acquittal of the offender.".

The Bill seeks to achieve the aforesaid objectives.

(Bill passed in State assembly. will be enforced after president’s assent)

The Factories (Rajasthan Amendment) Bill, 2014




A Bill further to amend the Apprentices Act, 1961, in itsapplication to the state of Rajasthan Be it enacted by theRajasthan State Legislature in the Sixty-fifth Year of the ,Republic of India, as follows:-

1. Short title and commencement.- (1) This Act maybe called the Apprentices (Rajasthan Amendment) Act,2014..

(2) It shall come into force at once.

2. Amendment of section 6, Central Act No. 52 of1961.- In the Apprentices Act, 1961 (Central Act No. 52 of1961), in its application to the State of Rajasthan,hereinafter referred to as the principal Act, for the existingclause (b) of section 6,the following shall be substituted,namely:-

"(b) in the case of other apprentices, the period ofapprenticeship training shall be such as may be prescribedby State Apprenticeship Council;".

3. Amendment of section 7, Central Act No. 52 of1961.- For the existing proviso to sub-section (3) of section7 of the principal Act, the following shall be substituted,;lamely:-

"Provided that where a contract is terminated-

(a) for failure on the Part of the employer to carry outthe terms and conditions of the contract, the employershall pay to the apprentice such compensation as may bedetermined by the State Apprenticeship Adviser;

(b) for such failure on the part of the apprentice, theapprentice shall refund to the employer as cost of training,such amount as may be determined by the StateApprenticeship Adviser.".

4. Amendment of section 8, Central Act No. 52 of1961.- For the existing section 8 of the principal Act, thefollowing shall be substituted, namely:-

"8. Number of apprentices for a designated trade.-(1) The Stale Government shall, after consulting the StateApprenticeship Council, by order notified in the OfficialGazette determine for each designated trade the ratio oftrade apprentices to workers other than unskilled workersin that Provided that nothing contained in this sub-sectionshall be deemed to prevent any employer from engaging anumber of trade apprentices in excess of the ratiodetermined under this sub-section.

(2) In determining the ratio under sub-section ( 1), theState Government shall have regard to the facilitiesavailable for apprenticeship training under this Act in thedesignated trade concerned as well as to the facilities thatmay have to be made available by an employer for thetraining of graduate or technician apprentices ortechnician (vocational) apprentices, if any, in pursuance ofa notice issued to him under sub-section (3A) by the StateApprenticeship Adviser or such other person referred to inthat sub-section.

(3) The State Apprenticeship Adviser may, by notice inwriting, require an employer to engage such number oftrade apprentices within the ratio determined by the StateGovernment for any designated trade in his establishment,to undergo apprentices* training in that trade and theemployer shall comply with such requisition:

Provided that in making any requisition under this sub-

section, the State Apprenticeship Adviser shall have regardto the facilities actually available in the establishmentconcerned: 'Provided further that the State ApprenticeshipAdviser may, on a representation made to him by anemployer and keeping in view the more realisticemployment potential, training facilities and otherrelevant factors, permit him to engage such number ofapprentices for a designated trade as is lesser than thenumber arrived at by the ratio for that trade, not beinglesser than thirty per cent of the number so arrived at,subject to the condition that the employer shall engageapprentices in other trades in excess in number equivalentto such shortfall.

(3A) The State Apprenticeship Adviser or any otherperson not below the rank of an Assistant ApprenticeshipAdviser authorised by the State Apprenticeship Adviser inwriting in this behalf shall, having regard to-

(i) the number of managerial person (includingtechnical and supervisory persons) employed in adesignated trade;

(ii) the number of management trainees engaged in theestablishment;

(iii) (iii) the totality of the training facilities available ina designated trade; and

(iv) (iv)such other factors as he may consider fit in thecircumstances of the case;

by notice in writing, require an employer to imparttraining to such number of graduate or technicianapprentices or technician (vocational) apprentices in suchtrade in his establishment as may be specified in suchnotice and the employer shall comply with suchrequisition.

Explanation.- In this sub-section the expression"management trainee" means a person who is engaged byan employer for undergoing a course of training in theestablishment of the employer (not being apprenticeshiptraining under this Act) subject to the condition that onsuccessful completion of such training, such person shallbe employed by the employer on a regular basis.

(4) Several employers may join together for the purposeof providing practical training to the apprentices underthem by moving them between their respectiveestablishments.

(5) Where, having regard to the public interest, anumber of apprentices in excess of the ratio determined bythe State Government or in excess of the number specifiedin a notice issued under sub-section (3A) should in theopinion of the State Government be trained, the StateApprenticeship Adviser may require employers to train theadditional number of apprentices.

(6) Every employer to whom such requisition asaforesaid is made shall comply with the requisition if theState Government concerned makes available suchadditional facilities and such additional financialassistance as are considered necessary by the StateApprenticeship Adviser for the training of the additionalnumber of apprentices.

(7) Any employer not satisfied with the decision of theState Apprenticeship Adviser under sub-section (6), may

The Apprentices (Rajasthan Amendment) Bill, 2014

make a reference to the Stale. Apprenticeship Council andsuch reference shall be decided by a Committee thereofappointed by the State Apprenticeship Council for thepurpose and the decision of that Committee shall be final.".

5. Amendment of section 9, Central Act No. 52 of 1961.-In section 9 of the principal Act,-

(i) for the existing sub-section (1), the following shall besubstituted, namely:-;

"(1) Every employer shall, make suitable arrangementsin his.. establishment or, outsource the same to a suitablethird party training provider for imparting a course ofpractical training to every apprentice engaged by it inaccordance with the programme approved by the StateApprenticeship Adviser."; and

(ii) for the existing sub-clauses (i) and (ii) of clause (a) ofsub-section (8), the following shall be substituted, namely:-

"(i) if such employer employs two hundred and fiftyworkers or more, by ' the employer and the Government inequal shares up to such a limit as may be laid down by theState Government and such amount shall be reimbursed bythe State Government in each case of completion ofsuccessful training by the apprentice;

(ii) if such employer employs less than two hundred andfifty workers, by the State Government alone and suchamount up to such a limit as may be laid down by the StateGovernment shall be reimbursed by the State Government,and beyond that limit by the employer in each case ofcompletion of successful training by the apprentice; and"

6. Amendment of section 13, Central Act No. 52 of1961.- For the existing section 13 of the principal Act, thefollowing shall be substituted, namely:-

"13. Payment to apprentices.- The employer shall payto every apprentice during the period of apprenticeshiptraining such stipend at a rate not less than the minimum

wages notified by State Government under the MinimumWages Act, 1948 (Central Act No. 11 of 1948) for unskilledWorker category, as may be specified in the contract ofapprenticeship and the stipend so specified shall be paid atsuch intervals and subject to such o conditions as may beprescribed."

7. Amendment of section 14, Central Act No. 52 of1961.- For the existing section izi..t)f the principal Act, thefollowing shall be substituted, namely:-

"14. Health,. safety and welfare of apprentices.-Where any apprentices are undergoing training in afactory, the provisions of Chapters 111,- 1.V and V of theFactories Act, 1948 (Central Act No. 63 of 1948), shall applyin relation to the health. safety and welfare of theapprentices as if they were workers within the meaning ofthat Act and when any apprentices are undergoing trainingin a mine, the provisions of Chapter V of the Mines Act,1952* (Central Act No. 35 of' 1952). shall apply in relation tothe health, 'safety and welfare of the apprentices as if theywere persons employed in the mine and when anyapprentices arc undergoing training in a shop orcommercial establishment, the provisions of the RajasthanShops and Commercial Establishments Act,1958 (Act No. 31of 1958), shall apply in relation to the health, safety andwelfare of the apprentices as if they were personsemployed in the shop or establishment.".

8. Amendment of section 23, Central Act No. 52 of1961.- For the existing sub-section (2) of section 23 of theprincipal Act, the following shall be substituted, namely:-

"(2) Every State Council may be affiliated to the NationalCouncil and every State Apprenticeship Council may beaffiliated to the Central Apprenticeship Council.".






The Contract Labour (R & A) (Rajasthan Amendment) Bill, 2014

A Bill to amend the Contract Labour (Regulation and Abolition) Act, 1970 (Central ActNo.37 of 1970), in its application to the State ofRajasthan. Be it enacted by the Rajasthan StateLegislature in the Sixty-fifth Year of the Republic ofIndia, as follows: -

1. Short title and commencement.- (1) This Actmay be called the Contract Labour (Regulation andAbolition) (Rajasthan Amendment) Act, 2014.


2. Amendment of section 1, Central Act No. 37of 1970.- For the existing sub-section (4) of section 1 ofthe Contract Labour (Regulation and Abolition) Act,1970 (Central Act No. 37 of 1970), the following shall besubstituted, namely :-

"(4) It applies-

(a) to every establishment in which fifty or moreworkmen are employed or were employed on any dayof the preceding twelve months as contract labour;

(b) to every contractor who employs or whoemployed on any day of the preceding twelve months

Minimum Wages in Haryanaw.e.f. 1.7.2014

Category Monthly Daily

Unskilled Rs. 5,639.50 Rs. 216.90Semi-skilled (A) Rs. 5,769.50 Rs. 221.90Semi-skilled (B) Rs. 5,899.50 Rs. 226.90

Skilled (A) Rs. 6,029.50 Rs. 231.90Skilled (B) Rs. 6,159.50 Rs. 236.90

Highly Skilled Rs. 6,289.50 Rs. 241.90

All Schedule Employment

fifty or more workmen:Provided that the State Government may, after giving not less

than two months' notice of its intention so to do, by notification inthe Official Gazette, apply the provisions of this Act to anyestablishment or contractor employing such number of workmenless than fifty as may be specified in the notification.".





A Bill further to amend the Industrial Disputes Act,1947 (Central Act No. 14 of 1947), in its application to theState of Rajasthan. Be it enacted by the Rajasthan StateLegislature in the Sixty-fifth Year of the Republic ofIndia, as follows: -

1. Short title and commencement.- (1) This Actmay be called the Industrial Disputes (RajasthanAmendment) Act, 2014.


2. Amendment of section 2, Central Act No. 14 of1947.- In the Industrial Disputes Act, 1947 (Central ActNo. 14 of 1947), in its application to the State ofRajasthan, hereinafter referred to as the principal Act,in section 2, -

(a) the existing sub-clause (iii) of clause (g), shall bedeleted; and

(b) in clause (s), the existing expression "by anemployer or by a contractor in relation to the executionof his contract with such employer" shall be deleted."

3. Amendment of section 2A, Central Act No. 14of 1947.- In section 2A of the principal Act, after theexisting sub-section (3), the following sub-section shallbe added, namely:-

"(4) Notwithstanding anything in sub-sections (1), (2)and (3), no such dispute or difference between thatworkman and his employer connected with, or arisingout of, such discharge, dismissal, retrenchment ortermination shall be deemed to be an industrial disputeif such dispute is not raised in conciliation proceedingwithin a period of three years from the date of suchdischarge, dismissal, retrenchment or termination:

Provided that an authority, as may be specified bythe State Government, may consider to extend the saidperiod of three years when the applicant workmansatisfies the authority that he had sufficient cause fornot raising the dispute within the period of threeyears."

4. Amendment of Chapter IIB, Central ActNo.14 of 1947.- Chapter IIB of the principal Act, asinserted by the Rajasthan Act No.34 of 1958, shall berenumbered as "Chapter IIC."

5. Amendment of section 9C, Central Act No.14of 1947.- Section 9C of the principal Act, as inserted bythe Rajasthan Act No.34 of 1958, shall be renumbered as"9-CC".

6. Amendment of section 9D, Central Act No. 14of 1947.- In section 9D of the principal Act, the existingexpression " fifteen per cent" shall be substituted by theexpression "thirty per cent."

7. Amendment of section 25K, Central Act No.14 of 1947.- For the existing section 25K of theprincipal Act, following shall be substituted, namely: -

"25-K. Application of chapter V-B.- (1) Theprovisions of this chapter shall apply to an industrialestablishment (not being an establishment of aseasonal character or in which work is performed only

intermittently) in which not less than three hundredworkmen were employed on an average per working dayfor the preceding twelve months.

(2) Without prejudice to the provisions of sub-section (1), the State Government may, if satisfied thatmaintenance of industrial peace or prevention ofvictimization of workmen so requires, by notificationin the official gazette apply the provisions of thischapter to an industrial establishment, (not being anestablishment of a seasonal character or in which workis performed only intermittently) in which suchnumber of workmen which may be less than threehundred but not less than one hundred, as may bespecified in the notification, were employed on anaverage per working day for the preceding twelvemonths.

(3) If a question arises whether an industrialestablishment is of a seasonal character or whetherwork is performed therein only intermittently, thedecision of the appropriate Government thereon shallbe final.

8. Amendment of section 25N, Central Act No.14 of 1947.- In section 25N of the principal Act, -

(a) in clause (a) of sub-section (1), the existingexpression ", or the workman has been paid in lieu ofsuch notice, wages for the period of the notice" shall bedeleted; and

(b) in sub-section (9), after the existing expression"six months" and before the punctuation mark ".",appearing at the end, the expression "and an amountequivalent to his three months average pay" shall beinserted.

9. Amendment of section 25 O, Central Act No. 14 of1947.- In sub-section (8) of section 25 O of the principalAct, after the existing expression "six months" andbefore the existing punctuation mark ".", appearing atthe end, the expression "and an amount equivalent tohis three months average pay" shall be inserted.

10. Amendment of Fifth Schedule, Central ActNo. 14 of 1947.- After the existing paragraph 5 of PartII to the Fifth Schedule of the principal Act, followingshall be added, namely:-

"Explanation.- For the purpose of this paragraph,'go slow' means any such activity by any number of persons, employed in any industry, acting in combination or with common understanding,to slow down or to delay the process ofproduction or work purposely whether called by workto rule or by any other name, so as the fixed or averageor normal level of production or work or output ofworkman or workmen of the establishment is notachieved:

Provided that all necessary ingredients or inputs forstandard quality production or work are made availablein time and in sufficient quantity."



The Industrial Disputes (Rajasthan Amendment) Bill, 2014




Anil Kaushik Management Expert -HR & IR

Solutions provided here are in context to narrated facts & not in general.

Q. When worker apply for leaves from saturday tomonday having in between sunday as weekly off, wemark him three days leave. It is general practicenot in our industry but also in others. Is it correct?What the law says in this respect?

Ans. if a worker takes leave of saturday andmonday, with sunday, as a weekly holiday,Leaves with wages to be counted will be of twodays only and not three days as you havementioned. You can refer to Sec. 79 of thefactories Act which says that leave shall beexclusive of all holidays, whether occurringduring or at the end of the leave period. In caseof commercial establishments covered byrespective state shop Act, relevant provisionsneed to be examined but in most states theseprovisions are almost same in respect of leaves.

Q. Our company has become sick. We also engagecontract labour in different activities because weare not able to pay the higher salaries as paid toregular employees. We have been told that in suchsituation engagement of contract labour can not beprohibited because it will further deteriorate theco. financial position. What is your legal advice inthe matter?

Ans. Sick Industry does not stand on adifferent footing. Contract labour Act has nosuch provision exempting sick industries fromprohibition of contract labour. Merely becausethe Industry is sick, does not mean thenotification prohibiting contract labour inspecific process will not be applicable. Supremecourt in the case of Bharat Fritz Werner Ltd vs.state of Karnataka 2001 1 LLJ 763;2001 LLR 285has also held that when the Got. Wasformulating the policy it had to take note of theconditions prevalent generally in suchestablishment and not with reference ton anyone or other. In general, it is found that it wouldbe appropriate to abolish contract labour incanteens run by factories; individualdistinctive features do not affect such adecision. When the notification is applicable to

establishments falling in a particular category,the fact that separate notification is not issuedwill not make impact on the action of the Govt.in the issue of a notification, if otherwise it isvalid. In this case a notification was issuedprohibiting engagement of contract labour incanteens when factory was employing 250 ormore workers.

Q. We have completed enquiries of workmenchargesheeted for certain misconducts. These werepartially participated by workmen but at last theyremained absent and was concluded ex-parte. Now,I want to know whether it is legally necessary toissue them second show cause notice beforetermination?

Ans. No! It is not legally required in all cases.But yes, if your service rules/ certifiedstanding orders make it necessary to givesecond show cause notice before inflictingpunishment, then you are under legalobligation to do so. There are court judgmentswhich say that non issuance of show causenotice before punishment will not vitiatedisciplinary proceedings (Dinesh Kumar Guptavs. Kshetriya Grameen Bank. 2006 LLR 701MP). Unless a prejudice has been caused to thedelinquent employee an enquiry will not bevitiated (Management of Indian AirlinesSecundrabad vs. IT-1 Hyderabad. 2001 LLR 1028A.P.) Non issuance of 2nd show cause noticebefore imposing punishment will not renderthe enquiry illegal (S. Shenabagaraj vs. Adl.Com. of Industries, Chepauk, 2005 LLR 61Madras) & (Murari Lal Ramharak Gupta vs.India link chain mfg. ltd. 2005 LLR 829Bombay). Allahabad High Court in the case ofprovincial co-operative union vs. P.O. LabourCourt Gorakhpur 2007 LLR 282 has held thatwhen a workman deliberately did notparticipate in the enquiry, he cannot questionabout its validity. I am not aware of yourservice rules So, I suggest that though it maynot be legally required in your case you shouldafford him opportunity to comment upon the

enquiry findings through second show causenotice. It will further establish yourimpartiality. There should not be any problemto the management is this regard.

Q. Definition of Lock Out In I.D. Act speaks of:"lock-out" means the temporary closing of a placeof employment or the suspension of work, or therefusal by an employer to continue to employ anynumber of persons employed by him. In thisdefinition, it is mentioned that "refusal by anemployer to continue to employ any number ofpersons employed by him. Does it mean that whiledeclaring lock out, we can call some workers & stopothers? Pl. removes the confusion by your expertadvice.

Ans. The phrase 'refusal by an employer tocontinue to employ any number of persons' inthe definition of lock out corresponds to thephrase 'cessation of work' or 'refusal tocontinue to work or accept employment'occurring in the definition of the 'strike.' Thephrase on which you have tried to put emphasisto draw the conclusion that you can refuse toemploy 'any' number of person whilecontinuing with your rest of the businessactivity is ill founded and wronginterpretation. This phrase in the definition oflock out has to be read with rest of definitionand also the word 'lock out' in totality of thesewords. In Ferozdeen vs. State of Bengal 1960 ILLJ 244 (249) SC and in Mohammad Samsudinvs. Sasamusa Sugar works 1956 I LLJ, SC hasemphasized that these words have to giverestricted meaning. The word 'any' connotesunlimited but with the condition that it has tobe in respect of temporary to other of businessplace or suspension of work on his premises.

Remember that lock out exists only when it isin terms of complete suspension of businessactivity in a particular business premises.

The closure of place the business for durationof three days which was in retaliation tocertain acts of workman was held to be lock out(Express newspaper Case) 1962 II LLJ 227 (SC).Temporary suspension of work necessitated bylack of stock was held not to constitute lockout. (Anamallais Timber Trust Case 1952 II LLJ604) Temporary stoppage of work for lack ofraw material was held not to be lockout.(Praboo Pandey vs. J.K. Jute mills. 1956 I LLJ588) Closure of a section of an industry carriedon by employer on account of trade reasonswas held not to be lock out and the closure ofanother section also as a result of the refusal ofthe workman to work in sympathy for theworkman of the former section was held not tobe a lock out. (Industrial and GeneralEngineering Co. vs. Their workman 1964 II LLJ438 (Mys.).

Lock out like strike implies a collective disputewhich must be either antecedent to orsimultaneous with the refusal to employ or towork.

Q. What is the difference between lock out and layoff?

Ans. The concept of 'lock-out' is essentiallydifferent from the concept of 'lay-off' and sowhere closure of business amounts to a 'lock-outunder S. 2(l), it would be impossible to bring itwithin the scope of 'lay-off' under S.2 (kkk). Thepoints of distinction between 'lay-off' and 'lock-out' may be broadly stated as follows:

'Lay-off' generally occurs in continuousbusiness, whereas 'lock-out' is closure ofbusiness for the time-being. In the case of 'lay-off' due to the reasons specified in S. 2 (kkk), theemployer is unable to give employment to one ormore workmen, whereas in the case of 'lock-out'the employer deliberately closes the businessand locks out the whole body of workmen forreasons which have no relevance to the causesspecified in S. 2 (kkk). In the case of 'lay-off', theemployer may be liable to pay compensation asprovided by Ss. 25C, 25D and 25E of the Act, butliability for compensation cannot be invoked incase of 'lock-out', as the liability of the employerin cases of 'lock-out would depend upon whetherthe 'lock-out' was justified and legal or not. Theprovisions applicable to the payment of 'lay-off'compensation cannot be applied to cases of'lock-out.' 'Lock-out' is resorted to by theemployer as a weapon of collective bargainingand also ordinarily involves an element ofmalice or ill-will while 'lay-off' is actuated by theexigencies of the business.

There are some resemblance also:

1. Both 'lay-off' and 'lock-out' are temporary innature and both arise out of and exist duringan emergency though the nature ofemergencies in each case is different. 2. Both in'lay-off' and 'lock-out', the relationship ofemployment is only suspended and is notsevered. 3. 'Lay-off' resorted to in contraventionof the provisions of S.25-M is illegal andpunishable under S. 25Q, while 'lock-out'declared in contravention of the provisions ofSs. 10(3), 10A (4A), 22 or 23 is illegal andpunishable under S. 26 of I.D. Act.

Q. Under ID act 1947 can we lock out one part of thefactory or not? For example : we have four sectionslike , 1) assembly 2) welding 3) machining & 4)paint shop. If we want to lock out only machining,can we do that legally or not?

Ans. No! Lock out is the antithesis of strike. Itis a weapon in the hands of management topersuade by coercive process to make employeesee the employer's point of view. When workersresort to strike then management often use thisweapon. It is not like that you declare lock outin one portion of the plant. Lock out is atemporary closure of business place to pressthe workers to make them accept employersview.

It is different from lay off and closure. Beforedeclaring lock out management has to act verycautiously because if this weapon is usedwithout considering all aspects, it may backfireon management. It is lay off which can bedeclared in a section or department ofindustrial establishment and not lock out.



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Back WagesIf the Management does not provide

alternative duty to the workman as perrecommendation of the Medical Board, it isliable to pay Back-Wages i. e. IOD Wages to theworkman for the relevant period when theworkman had become unable to perform hisoriginal duty.

Awadh Kumar Singh vs. Central Coalfields Limitedand Others. 2014-II LLJ 667 (Jhar. H. C.)

“Put off duty” cannot be equated withsuspension when the employer keeps workmanabsent from duty. Workman is entitled for fullback wages.

In the absence of any applicable regulations tolink 'put off duty' to 'suspension', 'put off duty' is tokeep the workman absent from duty by theemployer. When the employer keeps the workmanabsent from duty or the workman is not allowed toperform duty without any lawful order ofsuspension from service, demand of workman forfull back-wages during that period is justified. In theabsence of any statutory support from theapplicable Regulations 'put off duty' cannot beequated with the term 'suspension'.

B. Eswaraiah vs. Presiding Officer, Labour Court-I,Chandra Vihar, Hyderabad and Another. 2014-II LLJ

530; 2014 (142) FLR 459 (A.P. H.C.)

CompensationFor termination of a casual workman with 4

years service, compensation of one lakh in lieuof reinstatement would be appropriate.

Awarding reinstatement, in all cases wherein thetermination of services of an employee is illegal orwithout compliance of section 25-F of the IndustrialDisputes Act, 1947, as a matter or routine, is notappropriate. Awarding reinstatement to anemployee depends on various circumstances, suchas reason of termination, length of service, natureof employment, delay in raising dispute, etc.

Awarding reasonable compensation in lieu ofreinstatement is appropriate taking intoconsideration the relevant factors by the LabourCourt or Industrial Tribunal.

Pariyojna Adhikari, Sagan Cukkat Vikas Khand &Anr. vs. Manna Ram & Anr. 2014 LLR 861 (Raj. H.C.)

Compensation of Rs.75,000/- in lieu ofreinstatement is appropriate for a daily wagerwith three year service. In all cases of wrongfultermination, reinstatement is not appropriate.

In all cases of wrongful termination, awardingreinstatement is not appropriate as the principle ofreinstatement with full back-wages is not to beapplied mechanically. Before exercising its judicialdiscretion, the Labour Court/Industrial Tribunal,while deciding the quantum of relief in the shape ofmonetary compensation, in a case of wrongfultermination, has to consider several factorsincluding the mode and manner of appointment,nature of employment, length of service, delay inraising the industrial dispute by the workman, etc.

Krishan Kumar vs. Chief Engineer, PWD (PublicHealth), Haryana, Chandigarh and Others. 2014

LLR 864 (P&H H.C.)

Compensation is lieu of reinstatement topart time daily wage sweeper is appropriate.

Termination of services of a workman withoutassigning any reason without compliance of section25F of the Industrial Disputes Act, 1947 is illegalattracting reinstatement with back-wages andcontinuity of service. Compensation in lieu ofreinstatement with back-wages is appropriatekeeping in view part-time casual engagement as asweeper, mode of engagement and non-existence ofsanctioned post in Government office.

Divisional Manager, Orissa Forest DevelopmentCorpoation Ltd., Boudh (C-KL) Division vs. Apasari

Bhoi. 2014-II LLJ 632 (Orissa H.C.)

Contract LabourMere supervision of work by principal

employer does not create any relationshipbetween company and contract labour.

An Award is liable to be set aside if the IndustrialTribunal/Labour Court has not discussed theevidence on record. It may not always be necessarythat a judgment or Award has to be exhaustive, yetessential reasoning with reference to the materialon record cannot be short circuited. Contractlabourers cannot raise an industrial dispute forregularisation unless a notification under section 10



Recent Important JudgmentsLatest Judgments



(1) of the Contract Labour (Regulation andAbolition) Act, 1970 has been issued by theAppropriate Government.

Mere supervision of works of the workmenengaged through contractors does not create anyrelationship between the company and theworkmen or the contract between the contractorsand the principal employer is sham or camouflage.

Oil Mah Management Driling Workers' Union vs.The Management of Oil India LImited and Others.

2014 LLR 819 (Gau. H.C.)

240 days working in a calender year cannotbe the sole ground for regularisation. Suchdemand is not justified in the absence ofemployer-employee relationship between thecompany and contract workers.

Adverse inference against the Management fornon-production of attendance register is notjustified in the absence of any legal order passed bythe Industrial Tribunal in this respect.

Without there being employee-employerrelationship, demand of regularisation by theworkmen is not justified. . Merely working of "240days" in a calendar year cannot be the sole groundfor regularisation. Non-compliance of theprovisions of Contract Labour (Regulation andAbolition) Act, 1970 would not result inregularization, rather it would result in prosecutionunder section. 23/24 of the Act.

Wages/salary payment, control and supervisionare the main deciding tests if the workmen are ofcontractor's employees or of principal employer'semployees. Mere control and supervision of thecontractor's employees by the principal employerwill not make them employees of the principalemployer because when the contract is for supply oflabour, necessarily the labour will, work under thecontrol and supervision of the principal employer.

If right to regulate the employment and ultimatecontrol lies with the contractor, the contract labourcannot claim to employed by the principal employeror employees of the principal employer. In theabsence of any legal order, passed by the LabourCourt/ Industrial Tribunal for production ofattendance record by the Management, drawingadverse inference by the Tribunal for non-production of attendance register by theManagement, is erroneous.

Their Workmen, Bihar Colliery Kamgar Union vs.Bharat Coking Coal Ltd. & Anr.

2014 LLR 842 (Jhar. H.C.)

Disciplinary ProceedingsRegular domestic enquiry is not required if

the punishment is of minor nature.

A full fledged enquiry is not expected to be heldin all cases to avoid frustration to summaryprocedure for imposing minor penalties, yet thediscretion under the Regulation if exercisedarbitrarily, the same is to face challenge before theappropriate forum. Imposition of punishmentwithout formation of opinion by the disciplinary

authority for not conducting regular enquiry as perrequirement of relevant Regulation is notsustainable. Formation of opinion by thedisciplinary authority for not conducting regular'enquiry must reflect reason(s) in writing, indicatingapplication of mind otherwise the order imposingpunishment would be liable to be quashed.

Regular enquiry is not necessary if thepunishment to be imposed is of minor nature.

Food Corporation of India & Ors. vs. Sarat ChandraGoswami. 2014 LLR 785 (S.C.)

Enquiry officer is expected to explore thereason of insubordination before reaching tothe conclusion. If the finding is not based ofevidence, it would be perverse.

In conducting disciplinary proceedings whendelinquent employee is charged for'insubordination', the Enquiry Officer, being a quasi-judicial officer, is expected to explore the reasons fornon-compliance of directions of a superior by thesubordinate before arriving at any conclusion. Inpublic-sector undertaking, while conductingdisciplinary proceedings, the Enquiry Officer mustdirect himself with organisational criteriaperspective in mind taking into account thatdecisions are based on ethical principles, consistentwith the collective will of the organisation.

In a public organisation if an employee expresseshis dissatistaction on an additional work beingallotted to him, especially when there is nopreordained system of distribution of work, suchexpression need not to be construed asinsubordination i.e., something part of right of freeexpression. If the finding of guilt, in the domesticenquiry, is based on no evidence, it would be perversefinding, amenable to judicial scrutiny . Power ofjudicial review is to be directed against the decisionsulking process and not to the decision itself.

Mathew vs. State of Kerala. 2014 LLR 800 (Ker. H.C.)

Admission and confession cannot be treatedas conclusive proof without enquiry.

Holding of enquiry by an employer cannot bedispensed with even when the delinquent employeeadmits the charges since admission and confessionhas to be proved and cannot be treated as conclusiveproof without holding of an enquiry.

Defence Research Education Society vs. PrescribedAuthority, Labour Court, Uttarakhand and Another.

2014 LLR 871 (Uttar. H.C.)

Past unblemished long service record may bea mitigating factor to reduce the gravity of themisconduct and reduction in quantum ofpunishment.

When the Disciplinary Authority has notconsidered clean and unblemished past servicerecord of the delinquent employee despite the samebeing mandatory as per applicable Standing Ordersimposing punishment upon an employee againstproved misconduct, is liable to be set aside since theconsideration of the past long unblemished recordmay be a mitigating factor to reduce the seriousnessand gravity of misconduct, thereby resulting into


reduction in quantum of punishment. When theemployer has developed sick health, awardingreinstatement with back-wages to the workmanwould amount to foisting the workman upon thepetitioner-Management which is not justified.

Keeping in view clean past service record and 30years' employment, a lumpsum compensation of Rs.10,00,000 excluding payment of gratuity, isappropriate in lieu of reinstatement with back-wages. Perversity in the finding of the EnquiryOfficer is to be looked into the evidence recorded bythe Enquiry Officer while conducting enquiryproceedings and not by leading fresh evidencebefore the Labour Court. There being no evidence orinsufficiency of evidence, the finding of theEnquiry Officer can be held to be perverse.

The conclusion of the Enquiry Officer cannot besubstituted by the Labour Court, holding the findingof the enquiry to be perverse without consideringthe evidence recorded in the enquiry proceedings. Ifdismissal of the workman by the Management isheld to be illegal on the ground of not proving thecharges or finding of the enquiry not consideredaccording to the provisions of applicable StandingOrders due to, which the enquiry finding is setaside, the awarding of back-wages to the workman,in addition to reinstatement, is justified.

Indian Seamless Metal Tubes Limited (TubesWorkers) vs. Kailash Nampelli Ushakoyal and

Another. 2014-II LLJ 577 (Bom. H.C.)

DismissalWhen the workmen indulge in act of

assault, dismissal of service has no fault.Deposition of victim-workmen in enquiry thatcharged employees assaulted them is sufficient.

Since victim-workmen deposed that delinquentemployees were involved in causing assault to themamongst others, lodging of FIR against theunknown persons or charge-sheet specifyingunknown persons would not help the delinquentemployees as the enquiry proceedings are not akinto a criminal trial.

Causing assult to the co-workers in the local trainwhile coming to work-place by the delinquentworkmen is an act of grave and serious nature,justifying their dismissal from service. Incident ofcausing assault to co-workers, In the local trainwhile coming to join duty is having a casualrelationship with the employment since it wouldnaturally put fear in the workmen to go to work-place. Concurrent finding of facts by the LabourCourt and confirmation thereof by the IndustrialTribunal cannot be interfered by the High Courtunder writ jurisdiction unless the same is perverseor not based on evidence on record.

R. Mada Swamy vs. Indian Express Newspaper(Mumbai) Pvt. Ltd., Mumbai. 2014 LLR 789 (Bom. H.C.)

Dismissal justified for assaulting thesuperior with bamboo stick.

Dismissal from service is justified whenmisconduct of extending threat to superiors iscommitted by the delinquent employee in the

premises of the employer followed by assaulting thesuperior with bamboo stick and stone out of thepremises, while leaving the premises after workinghours, causing injuries, is, proved against thedelinquent employee, since there is a direct casualrelationship between the misconduct and the duty.

Plea of victimisation is not sustainable when theCharges' of causing assault to superior stood provedin the enquiry and concluded to be fair and properby the Labour Court since such acts cannot becountenanced, especially when equitablejurisdiction is sought to be invoked.

Punishment of dismissal is not disproportionateto the gravity of misconduct of assaulting thesuperior with bamboo stick, causing injuries, whileon duty at the premises of the employer.

Ramesh Samarbahadur Singh vs. Century Textile &Industries Ltd. 2014 LLR 795 (Bom. H.C.)

Dismissal justified for using abusive and foullanguage against superior.

When the domestic enquiry is held to be fair andproper, misconduct of using abusive and foullanguage against superiors is proved, punishmentof dismissal is justified. Punishment of dismissalfrom service is not disproportionate to the gravity ofthe charges when the misconduct of using abusiveand foul language against superiors is proved byconducting fair and proper enquiry.

Balasaheb Ambadas Dhockchawale vs. IndianSeamless Metal Tubes Ltd. 2014 LLR 797 (Bom. H.C.)

Dismissal from service of a truck driver isjustified when he had caused accident causingdeath of person (s) due to his negligence indriving the vehicle without proper control.

Laxman yadav vs. Managing Director, RajasthanState Road Transport Corporation, Jaipur & Ors.

2014 LLR 848 (Raj. H.C.)

Dismissal justified for misconduct ofriotous, disorderly and indecent behaviourwhile going on illegal strike.

When the Labour Court has not given any reasonas to why action of Management to dismiss thedelinquent employees from service is harsh, suchfinding of the Labour Court is not proper. Whenonce it is held that the finding of the Labour Court isnot proper, granting any relief to the workmen bythe Labour Court, is not justified.

Punishment of dismissal from service cannot betermed as disproportionate since the provedmisconducts of willful insubordination, riotous,disorderly and indecent behaviour etc. are graveand serious in nature.

The plea of discrimination is not sustainablewhen the workmen themselves have admitted intheir claim that all the employees who were charge-sheeted for their misconducts, have been dismissedfrom service since the Management has taken auniform action against all the workmen who werecharge-sheeted for rioting.

Mahendra K. Raut and Another vs. GopalanandRasayan and Another. 2014 II LLJ 619; CLR II 2014 P.

362 (Bom. H.C.)




Employees’ compensation ActAccident of an employee is not restricted

only to his place of work but to the placeswhich come across from the time when hestarts means of access and egress to and fromplace of his employment.

Employment of an employee may end or maybegin not only when the employee begins to work orleaves his tools but also when he used the means ofaccess and egress to and from the place ofemployment, for the purpose of claimingcompensation under the Employees' CompensationAct, 1923. An employee is to be considered inemployment during the reasonable period of his toand from the place of his duty for establishing thatthe accident, if any, met by the employee has arisenout of and during the course of employment as perprovisions of the Employees' Compensation Act,1923, depending upon the facts and circumstances ofeach case.

Employment does not necessarily end when the"down tool" signal is given or when the workmanleaves the actual workshop since ‘notionalextension’ at both the entry and exist by time andspace depending upon circumstances of the case.When insurer fails to plead about existence of sucha clause relating to non-payment of interest in thecontract of insurance or does not lead any evidencein this respect before the Commissioner, such a pleato be taken in appeal is not sustainable.

Manju Sarkar & Ors. vs. Mabish Miah and Ors.2014 LLR 854 (S.C.)

Simple pleading of rash and negligentdriving cannot take away the right of deceasedto get compensation.

Unless there is wilful disobedience by theemployee of an order expressly given by theemployer or to a rule expressly framed andapplicable, there would be no negligence on the partof the employee only on the basis of simple pleadingof rash and negligent driving by the driver of thevehicle.

When on specific pleading of negligence ofdriver has been taken before the Commissioner andproved by leading substantial evidence, such aground in appeal is not available to theappellant/insurer. The Legislature enacted section 4(1) (B) of the Act to do away with the disputes withrespect to quantum of salary for the purpose ofcalculation of compensation under the Employees'Compensation Act, 1923.

The Oriental Insurance Company Limited vs.Satender Kumar and Anr. 2014 LLR 787 (Delhi H.C.)

Bathing in the canal and the fetching watercannot be said to be an act incidental to theemployment. Dependents of the deceased notentitled to compensation.

Expiry of the driver and clearner in the YamunaCanal by their drowning in the canal water whilethey went to the canal side by stopping their vehicleon road side for taking bath and fetching water, nodoubt, is an accident during the course of

employment but the same is not out of theemployment, making the dependants of thedeceased entitled to compensation under theEmployees' Compensation Act, 1923.

Fetching water from the canal or bathing in thecanal by the driver and clearner by stopping thevehicle on road side cannot be said to be incidentalto the employment, when it is not shown that therewas no other source of water available in thevicinity than the canal' itself.

When the accident has no casual connection withthe employment, the injured or dependants of thedeceased due to accident, would not be entitled tocompensation under the Employees' CompensationAct. Of When the workmen had exposed themselvesto an added peril by their own imprudent actcausing accident resulting into their death, evenduring the course of their employment, theirdependants are not entitled to claim compensationunder the Employees' Compensation Act since suchan accident is not covered by the condition 'accidentout of employment'.

Oriental Insurance Company Ltd. vs. Poonam Devi(Smt.) & Others. 2014 LLR 826 ( All. H.C.)

Only because a person dies of heart attack,the same does not give rise to automaticpresumption that the same was by way ofemployment-accident since it depends uponmedical opinion and circumstances,establishing cause of heart-failure due to stressand strain of work.

To bring an accident causing death due to heart-attack, under the coverage of accident arising out ofand during the course of employment, each case tobe considered on its own fact and no hard-and-fastrule can be laid down. Since the Corporation despitehaving vital opportunity to subject the deceased topost-mortem to ascertain actual cause of death,ignored the conducting of post-mortem, cause ofdeath has been rightly believed to be due to heart-attack.

Depot Manager, APSRTC, Sireilla Depot andAnother vs. R. Devalaxmi and Others. 2014-II LLJ

682 (A.P. H.C.)

Deposit of amount of interest or penalty,imposed under section 4A of the Employees'Compensation Act, 1923, is not ‘a conditionprecedent for preferring an appeal under theEmployees /Workmen's Compensation Act-,1923’. Accrued interest is not to be calculatedthirty days after the accident till the date ofpayment of the amount of compensation.

S. Suresh vs. T. Selvam and Others.2014 (141) FLR 888 (Mad. H.C.)

When accident has taken place on a publicroad while using private transport, it is not anaccident arising out of and in the course ofemployment.

The respondent was in the employment of theappellant. He meet with an accident on a public roadon a private scooter while going back from duty. Theaccident happened on 1.5.1990. Ten years thereafter,he filed a claim petition for compensation. TheCommissioner for Workmen's Compensation




condoned the delay of 10 years and awardedcompensation to the respondent. Feeling aggrievedthereby, the appellant filed the present appeal beforethe High Court.

The High Court observed that the present casewas squarely covered by the decision of theSupreme Court in the case of Saurashtra SaltManufacturing Company v. Bal Valu Raja whereinthe Supreme Court held that if an employee is at apublic place while travelling to and fro from duty,and at such time if an accident happens in thatpublic place which is otherwise used by generalpublic, the accident cannot be said to have arisenout of and in the course of employment. It was heldin that case that as a rule, the employment of aworkman does not commence until he has reachedthe place of employment and does not continuewhen he has left the place of employment, thejourney to and from the place of employment beingexcluded. The Supreme Court however clarified thatthis rule is subject to the theory of notionalextension of the employer's premises so as toinclude an area which the workman passes andrepasses in going to and in leaving the actual place ofwork. In the instant case, the High Court on factsheld that the accident did not arise out of and in thecourse of employment to make the employer liableto pay the compensation. The High Court criticizedthe Commissioner for condoning the huge delay of10 years. In the result the appeal was allowed andthe order of the Commissioner was set aside.

Union of India vs. Ram Chander. CLR I 2014 P. 827(Delhi H.C.)

Employees’ Provident FundDamages would be recoverable jointly and

severally from the erstwhile as well as currentmanagement.

M/s. Mahura Tea Estates owned by Saroda TeaCompany Ltd. defaulted in remitting contributionsand accumulations. Show-cause notice issued to itfor imposition of damage. Mathura Tea Estatestaken over by the Eveready Industries (India) Ltd. Itdischarged liability to entire principal sumpertaining to period prior to take over. Plea ofEveready Industries (India) Ltd. that there wasspecific agreement that damages payable for failureto pay such dues would be exclusive liability of theSaroda Tea Company repelled. Failure on part ofemployers to make remittances of accumulationand contribution undermines objectives andpurpose of the statute. Liability of the fund to payinterest to subscribers runs relentlessly whetheremployers have paid their dues or not. Petitionerrightly burdened with payment of interest.

Mcleod Russel India Limited vs. Regional ProvidentFund Commissioner and Others. 2014 (142) FLR 406

(S.C.)

Without identification of beneficiaries,demand of PF contribution upon employerwould be inappropriate.

It is obligatory on the 7A Authority under theEmployees' Provident Funds and MiscellaneousProvisions Act, 1952 to waive employees' share of PF

contributions for the pre-discovery period in view ofgeneral notification of the Central Government,Ministry of Labour.

It is settled position of law that withoutidentification of beneficiaries, demand of deposit ofPF contribution upon the employer by the EPFAuthority under the Act would be useless since theamount would not be credited to the account of therespective beneficiary. As per provisions of theEmployees' Provident Funds and MiscellaneousProvisions Act, 1952, the maximum limit for thecondonation of delay is 120 days by the EPFAppellate Tribunal and not beyond it. Employees'share of PF contribution, in respect of pre-discovery period, should not be recovered if nodeduction from the wages of the respectiveemployee has been made.

Shrirampur Education Society vs. RegionalProvident Fund Commissioner (Recovery) and

Others. 2014 LLR 792 (Bom. H.C.)

Trainees engaged under Certified StandingOrders will be out of the purview of the EPFAct.

Section 2 (f) of the Employees' Provident Fundsand Miscellaneous Provisions Act, 1952 clearlyexempts apprentices who have been appointedunder the Apprentices Act, 1961 or under theStanding Orders of the Establishment certifiedunder the Industrial Employment (Standing Orders)Act, 1946. The term 'industrial establishment', asdefined under section 2 (e) of the IndustrialEmployment (Standing Orders) Act, 1946 and underclause (ii) of section 2 of the Payment of Wages Act,includes 'workshop or other establishment' in whicharticles are produced, adapted or manufactured,with a view to their use, transport or sale.

An employer manufacturing ornaments for sale isan 'industrial establishment', as defined under section2 (e) of the Industrial Employment (standing Orders)Act, 1946 and under clause (ii) of section 2 of thePayment of Wages Act. The trainees appointed underthe Standing Orders duly certified under theIndustrial Employment (Standing Orders) Act, 1946 bysuch an employer are not covered under the EPF Act.

Malabar Business Centre (P) Limited vs. Employees'Provident Fund Appellate Tribunal and Another.

2014 LLR 807 (Ker. H.C.)

Contractors having less number of workersrequired for PF coverage may still apply forvoluntary coverage and obtain PF code numberunder section 1(4) of the Act.

Employees of contractors can be, assured of thebenefits of the Employees' Provident Funds andMiscellaneous Provisions. Act, 1952 - If theContractors are interested to work for Indian OilCorporation, they may apply for allotment of PFCode number by invoking section 1(4) of the Act,providing provisions for voluntary coverage sincethe EPF Act is a beneficial piece of legislation andits benefits should reach all employees.

The main object of the Employees' ProvidentFunds and Miscellaneous Provisions Act, 1952, is toencourage the habit of regular saving by theemployees.




The principal employer may recover theemployee's contribution from the contractor undersection 8A of the Employees' Provident Funds andMiscellaneous Provisions Act, 1952. When there isno employee employed by the Contractor, he cansubmit 'nil return' to the EPF Authority.

M/s. K. M. Sarmah Electricals and Others vs.Indian Oil Corporation and Others. 2014 LLR 809

(Gau. H.C.)

Exempted unit is not entitled to claim thatno damages can be levied against it.

Petitioner being exempted under section 17 (1) (a)of the Employees' Provident Funds andMiscellaneous Provisions Act, 1952 is not entitled toclaim that no damaged can be levied against it. EPFAppellate Tribunal, being last fact findingAuthority, is entitled to exercise its discretion bygiving proper reasons satisfying the legal tests inreducing the quantum of damages and evengranting complete waiver by interfering with thequantum of damages and interest levied by the EPFAuthority.

Coimbatore District Consumers Co-op. WholesaleStores Ltd. vs. Presiding Officer, Employees'

Provident Fund Appellate Tribunal, New Delhi andAnr. 2014 LLR 838 (Mad. H.C.)

Summoning order and proceedings undersection 7A stand quashed in the absence ofproviding copy of the report of theenforcement officer to the employer.

Summons, issued by the EPF Authority undersection 7A of the Employees' Provident Funds andMiscellaneous Provisions Act, 1952, only on thebasis of report of the Enforcement Officer, in theabsence of a copy of the report enclosed therewith,suffers from denial of justice, liable to quash thesummoning order. No interference under writjurisdiction is called for in the summoning orderissued by the EPF Authority since the coverage ofin-plaint trainees under the Act is yet to be decidedby the EPF Authority, taking into account thefactual position.

Wipro Enterprises Ltd. (Consumer Care & LightingDivision, Mysore) vs. Regional Provident FundCommissioner, Mysore. 2014 LLR 850 (Kar. H.C.)

Principal employer is responsible for PFcontribution of the contractor workers.

Non-furnishing of report of the squad to theemployer during pendency of the proceedings undersection 7A would be violative of principles of naturaljustice hence the proceedings will be based on thesquad's report. Under paragraph 30 (3) of theEmployees' Provident Fund Scheme, the primaryliability for deposit of contribution for the employeesof the contractor is upon the principal employer.Keeping in view the rehearings of the proceedingsunder section 7A, of the Employees' Provident Funds& Miscellaneous Provisions Act, 1952, the petitioner(employer) will deposit Rs. 2 crore to be depositedwith the nationalised bank to fetch the highest rate ofinterest till the matter is adjudicated.

M/s. Bata India Limited vs. Union of India & Ors.2014 LLR 866 (Cal. H.C.)

While imposing damages EPF Authority hasto take into consideration the factors such asconditions of default, period of default,frequency of defaults and amount involved, etc.

While imposing damages under section 14B Ofthe Employees' Provident Funds, and MiscellaneousProvisions Act, 1952, the EPF Authority has to takeinto consideration the factors such as conditions ofdefault, period of default, frequency of defaults,amount involved, etc. Imposition of damages undersection 14-B of the Employees' Provident Funds andMiscellaneous Provisions Act, 1952 is not justified ifemployer could establish unavoidablecircumstances leading to delayed remittance.Quantum of damages may vary on the basis of factsand circumstances involved in each case.

Jhantu Rudra vs. Union of India & Ors. 2014 LLR870 (Cal. H.C.)

Tribunal has power to modify or annul theorder of the EPF authority.

EPF Appellate Tribunal by virtue of section 7L ofthe Employees' Provident Funds & MP Act in anappeal, may pass such orders as it deems fit,confirming, modifying or annulling the orderappealed against or may refer the matter to theauthority for reconsideration. Reduction ofdamages and interest by the EPF Appellate Tribunalto the extent of 50% as imposed by the RegionalProvident Fund Commissioner not to be interferedby the High Court in the writ petition when delayeddeposit of contributions is not deliberate.

Regional Provident Fund Commissioner vs. M/s.Bharat Sewak Samaj Higher Sec. School. 2014 LLR

874 (M.P. H.C.)

E.S.I.Injury suffered by an employee due to

an accident occurred while commuting to and from the place of work, is covered by the term 'employment injury' as per section 2(8) ofthe Act.

Section 51(E) of the Employees' State InsuranceAct, 1948 clarifies that an injury which takes placeon account of an accident outside the premises ofthe employment but when the employee iscommuting to and from the place of work, theaccident will be included in the expression 'accidentarising out of and in the course of employment'.Section 51(E) of the Employees' State Insurance Act,1948 is only declaratory and ciarificatory in view ofuse of expression 'deemed' in it. Section 51(E) of theEmployees' State Insurance Act, 1948 would apply tothe accidents caused even prior to coming it into itsoperation.

Employees' State Insurance Corp. and Another vs.Poonam Sharma and Others. 2014-II LLJ 703 (Delhi

H.C.)

Any contribution under the E.S.I. Act, 1948,may be recovered as an arrear of land revenue.There is no 'limitation for the recovery ofarrears.

Since the Employees' State InsuranceCorporation has not moved EI Court, as such the






period of limitation provided under section 77(1-A)will not be applicable. The proviso to clause (b) ofsection 77(1-A) of the Employees' State InsuranceAct, 1948, fixing the period of 5 years for the claimmade by the ESI Corporation, will apply only inrespect of claim made by the Corporation before theEI Court (for the first time) and not to any otherproceedings.

Regional Director, E. S. I. C. and Another vs. AnuragCinema (P) Ltd. 2014 LLR 887 (Pat. H.C.)

Preparation of food in a kitchen of theHotel, by use of LPG, is a manufacturingprocess within the meaning of State InsuranceAct, since LPG is a form of power.

If State Government has, by notification,extended the provisions of the State Insurance Actto the establishments mentioned in the notification,it would not mean that other establishments, notmentioned in the notification, are excluded from theapplicability of the provisions of the Act, if theyotherwise quality for same under sub-section (4) ofsection 1. The appropriate Government can enlargethe sphere of applicability of the State InsuranceAct by exercising its power under sub-section 5 ofsection 1 of the Act and not constrict it.

If any establishment's a factory within themeaning of sub-section 4 of section' 1 read withsection 2(12) of the State Insurance Act, irrespectiveof the fact it is not covered by the notification of theState Government, it would fall under the coverageof State Insurance Act.

Omarkhayyam Bar and Restaurant, Nagpur vs. Dy.Regional Director, Sub-Regional Branch, ESI

Corporation, Nagpur. 2014 (141) FLR 1044 (Bom. H.C.)

Employees of independent contractor couldnot be held as employees of principal employerfor purpose of E.S.I. contribution.

Employees of independent contractors could notbe held to be the employees of the principalemployer for the purpose of payment ofcontribution under the Employees' State InsuranceAct, 1948. The right to reject or accept work oncompletion, on scrutinizing compliance with jobrequirements as accomplished by a contractor, theimmediate employer through his employees, is byitself cannot be construed as effective and meaningsupervision as envisaged under section 2(9) of theEmployees' State Insurance Act, 1948.

Dy. Director, Insurance No. V. Employees' StateInsurance Corporation, Chennai vs. India Pistons

Repco Ltd. 2014 (141) FLR 885 (Mad. H.C.)

GratuityLong unexplained delay in moving an

application for claiming gratuity before theControlling Authority under the Payment ofGratuity Act, 1972 not only defeats equity butat the same time it makes a rightunenforceable.

Ramdas Naw vs. Bank of India & Anr.2014 LLR 869 (Cal. H.C.)

Once the employee has consciously signedthe bond authorizing the retention of theamount of gratuity by its employer, it cannot besaid that he had any justified reason to claimrefund of the gratuity from his employer,having continued in illegal retention of thequarter.

Claim of the employee for payment of gratuitycannot be accepted in law when he is havingunauthorized retention of the official quarter.

Kunwar Ram vs. Managing Director, Bokaro SteelCity, Bokaro and Others. 2014 (141) FLR 847 (Jhar.

H.C.)

IndustryRadha Swami Satsang Beas is not an

industry since the employee did not produceany supporting documentary evidence.

If an employee fails to establish relationship ofemployer and employee, he would not be coveredunder the definition of 'workman' as defined undersection 2 (S) of the Industrial Disputes Act, 1947.

Bal Bahadar vs. Industrial Tribunal, Amritsar AndAnother. 2014 (141) FLR 964 (P&H H.C.)

INDUSTRIAL DISPUTES ACT

Dispute relating to bonus or ex-gratia is notmaintainable under section 33C(2) of the I.D.Act.

Dispute relating to bonus or ex-gratia in lieu ofbonus is not maintainable under section 33C (2) ofthe Industrial Disputes Act, 1947 since this sectiondeals with the proceedings of the nature ofexecution whereas the dispute of bonus relates toright of the workers in respect of bonus from theemployer. Payment of Bonus Act, 1965 is notapplicable to the petitioner in view of provisions ofsection 32 (iv) of the Act since the Management is aState Government establishment.

Haryana State through General Manager, HaryanaRoadways, Hisar Depot, Hisar vs. Presiding Officer,Labour Court, Hisar and Ors. 2014 LLR 815 (P&H

H.C.)

Proceedings shall not lapse merely by thereason of the death of any of the parties to thedispute being a workman as held by theSupreme Court in the case Shri RameshwarManjhi vs. Management of Sangramgarh, (1994)1 SCC 292, upholding the constitutional validityof section 10 (8) of the Industrial Disputes Act,1947.

M/s. Orang Tea Estate vs. The Union of India andOthers. 2014 LLR 862 (Gau. H.C.)

Interim ReliefLast drawn wages in the form of interim

relief cannot be recovered from workman bythe employer even if the employer succeed inhigher court.

Payment of last drawn wages made by anemployer under section 17B of the Industrial


Disputes Act, 1947, during pendency of proceedingsin the higher court, pertaining to an Award forreinstatement of a workman, cannot be recoveredby the Management/employer from the workmaneven if the employer succeeds since it is beneficialpiece of legislation intended for the benefit of theworkers.

Bongu Venkunaidu vs. Executive Engineer, I & CAD,Srikakulam and Others. 2014 LLR 876 (A.P. H.C.)

Labour Court JurisdictionCause of action will arise at the place where

the employee worked.

Appropriate Government at the place where thecause of action arises i. e. the place where theworkman lastly worked, would be havingjurisdiction to make reference of the industrialdispute to the Labour Court/Industrial Tribunal foradjudication, irrespective of the fact that theworkman was issued appointment letter or hiswages/salary was prepared and controlled by theemployer from any other place.

The cause of action arises at the place where theworkman lastly worked or the place from where hisservices were terminated by the employer or theplace where he received letter of termination of hisservices. If the workman was transferred to anyother place but he did not report for duty at the placeof his transfer, consequently if the employerterminates his services, then the cause pf actionwould arise where he lastly worked and' not at theplace of transfer.

Reference made by the appropriate governmentif not challenged by way of separate writ petition onthe point of territorial jurisdiction, Labour Court isbound to take cognizance of the reference since theLabour Court is not competent to transfer thedispute to any other Labour Court at different place.

Industrial Tribunal/Labour Court gets power toadjudicate the dispute pursuant to a reference inaccordance with the terms of reference since itcannot go beyond the terms of reference includingthe issue as to whether it had territorial jurisdictionor not.

For challenging territorial jurisdiction of theIndustrial Tribunal/Labour Court, the aggrievedparty has to file writ petition in the High Courtchallenging the reference made by the appropriategovernment without territorial jurisdiction or theappropriate government lacked the power to makethe reference.

Senior Manager, First Filght Courier vs. PresidingOfficer, Labour Court, Chandigarh, And Another.

2014 (141) FLR 1063 (P&H H.C.)

Minimum WagesCriminal complaint not maintainable if the

accused is not in-charge responsible to thecompany for its business.

A criminal complaint, filed before the ChiefJudicial, Magistrate, under the provisions of theMinimum Wages Act, 1948, against any of the

Directors, Managers or Secretaries or such otherofficial of the Company, without arraigning theCompany is not maintainable as per requirement ofsection 22C of the Act. A criminal complaint, filedbefore the Judicial Magistrate, under the provisionsof the Minimum Wages Act, 1948, against any of theDirectors, Managers or Secretaries or such otherofficial of the Company, is not maintainable if theaccused is not in-charge, responsible to theCompany for its business.

A director of the company cannot be prosecuted,on account of his being director, if he is notincharge or responsible to the Company for its day-today affairs. A person even not holding any officeor designation in a Company may be liable to beprosecuted if he satisfies the main requirement ofbeing in-charge of and responsible of conduct ofbusiness of the Company at the relevant time.

Deputy Manager, M/s. Bharat Heavy Electrical Ltd.vs. State of H. P. and Anr. 2014 LLR 831 (H.P. H.C.)

MisconductWhen the incident of causing assault to co-

workers took place in local train while comingto join duty, it had a casual relationship withthe employment. It cannot be said that theincident is totally unrelated to work.

R. Mada Swamy vs. Indian Express Newspaper(Mumbai) Pvt. Ltd., Mumbai. 2014 LLR 789 (Bom.

H.C.)

Assaulting superior by giving beatings withbamboo stick is a grave and seriousmisconduct.


Abusive and foul words used by an employeeagainst his superiors repeatedly are seriousand grave misconduct and not of minor ortechnical nature.

Balasaheb Ambadas Dhockchawale vs. IndianSeamless Metal Tubes Ltd. 2014 LLR 797 (Bom. H.C.)

Expressing dis-satisfaction on additionalwork being alloted to suboridnate in theabsence of pre-ordinated system of distributionof work will not be insubordination.

Refusal to obey or perform command from asuperior which a subordinate is obliged to performeither under contract or law is to be construed as'insubordination'.

Mathew vs. State of Kerala. 2014 LLR 800 (Ker. H.C.)

Causing accident due to uncontrolled drivingis an act of negligence which is grave andserious misconduct.

Negligence on the part of a driver, causingaccident due to uncontrolled driving of the vehicle,resulting into death of person (s), when proved onthe basis of evidence recorded, is a grave andserious misconduct.

An accident, occurred due to uncontrolleddriving of the vehicle since the place of occurrencebore the tyre marks of the vehicle to the extent of 10feet. Finding of facts recorded in evidence by the







Labour Court by no means can be denounced to beunfounded and dehors the records under writjurisdiction, by the High Court having limited scopeof scrutiny.

Laxman yadav vs. Managing Director, RajasthanState Road Transport Corporation, Jaipur & Ors.

2014 LLR 848 (Raj. H.C.)

ProbationerWhile employee was discharged from

services during probation as per terms andconditions of his employment contract and notby way of imposition of penalty, there is noscope to interfere with the order of dischargeunder writ jurisdiction.

Balakrushna Polai vs. National Bank ofAgricultural and Rural Development, Mumbai and

Others. 2014 (141) FLR 944 (Orissa H.C.)

PunishmentIf the domestic enquiry is held by the

Labour Court to be fair and proper or thefinding of enquiry are not challenged by thedelinquent employee, conclusion of the LabourCourt that punishment of dismissal is justifiedin view of misconduct of causing assault tosuperior can not be interfered with.


No employee should be punished withoutissuing show-cause notice and conductingdepartmental enquiry. Issuance of simpleshow-cause notice and passing the penaltyorder is nothing but an eye-wash.

The respondent is in the employment of thepetitioner Transport Corporation as a bus driver.On 29-12-1994 while driving a bus he met with anaccident with a jeep. In the accident damage wascaused to the bus.

It appears that the matter was taken to the MotorAccidents Claims Tribunal (MACT) and it was heldthat the accident in question was the result ofcontributory negligence and compensation of Rs.85,000/- together with 8% interest was awarded to beshared equally by the petitioner Corporation andthe driver of the jeep. Thereafter the petitionerCorporation issued a notice to the respondent toshow cause as to why recovery of the compensationamount should not be made from his salary andgratuity amount.

The respondent feeling aggrieved, raised anindustrial dispute and the Labour Court held thatsince no charge-sheet was issued nor anydepartmental enquiry was held against therespondent, the proposed recovery of compensationagainst him was illegal. The petitioner corporationchallenged the award of the Labour Court by filingthe present writ petition.

The High Court observed that noemployee/workman should be punished withoutbeing issued a show cause notice and without anydepartmental enquiry. Issuance of simple showcause notice and passing the penalty order is

nothing but an eye wash. Therefore, issuance ofshow cause notice cannot be equated with thedepartmental proceedings. Moreover, since therespondent had already been acquitted by thecriminal Court of the charge of rash or negligentdriving, therefore, imposition of penalty by thepetitioner was totally arbitrary and uncalled for.The High Court therefore dismissed the petition.

Regional Manager, Uttarakhand TransportCorportation vs. Mohan Chandra Joshi. 2014 LLR

822; CLR II 2014 P. 414 (Uttar. H.C.)

ReferenceRefusal to answer reference by the

Industrial Tribunal is not appropriate when ithas powers for adjudicating the same since itwould cause failure of justice.

Non-service of Notice under Section 9A of theIndustrial Dispute Act in the proper and prescribedmanner prior to effecting any change in theconditions of service is an illegal act on the part ofthe Management.

Cachar Paper Project Workers Union vs. State ofAssam and Others. 2014 (141) FLR 860 (Gau. H.C.)

ReinstatementPrinciple of reinstatement with full back-

wages is not to be applied mechanically in allcases. Workman can be given monetarycompensation to meet the ends of justice.

While awarding lumpsum compensation; thefactors like mode and manner of appointment,nature of employment, length of service, financialposition of the employer, etc., are required to betaken into consideration.

Municipal Council, Pathankot and Others vs.Presiding Officer and Another. 2014 LLR 812 (P&H

H.C.)

Even finding fault with the retrenchment ontechnical ground does not mean automaticreinstatement.

Since the reinstatement is not automatic,compensation in lieu of reinstatement with back-wages is appropriate keeping in view inordinatedelay on the part of the workmen in filling theirclaims before the Labour Court.

If the workmen does not place before the LabourCourt any document to prove that he was notgainfully employed during the intervening period,granting back-wages by the Labour Court is notjustified. When retrenchment is held to be bad onthe technical ground of application of section 25Nof the U. P. Industrial Disputes Act, 1947, instead ofgranting relief of reinstatement, lumpsumcompensation is appropriate.

Uttarkhand Forest Corporation & Ors. vs. DharamPal Singh. 2014 LLR 823 (Uttar. H.C.)

When punishment of dismissal is set aside,it will result into reinstatement with full backwages with continuity of service.

When the domestic enquiry is vitiated by theIndustrial Tribunal/Labour Court on account of itsbeing against the principles of natural justice, the




punishment of dismissal is liable to be set asideresulting into reinstatement with full back-wagesand continuity of service.

Awarding back-wages depends upon severalfactors including if the workman has taken a plea ofhis being not gainfully employed after histermination from service despite his efforts,whether termination from service is held to beillegal and the Management has failed to rebut thegainful unemployment of the workman.

There is no straight jacket formula for awardingback-wages as it depends upon the judicialdiscretion of the Labour Court/Industrial Tribunalin view of evidence on record.

Writ of Certiorari can be issued by the HighCourt under Article 226 of the Constitution of Indiaonly for correcting errors of jurisdiction, error oflaw apparent on the face of the record, if theIndustrial Tribunal/Labour Court had erroneouslyrefused to admit admissible material evidence orhad erroneously admitted inadmissible evidence.

Syndicate Bank, a Nationalised Bank vs. VinodKumar Amin. 2014-II LLJ 548 (Bom. H.C.)

RetrenchmentRetrenchment of a casual workman doing

work of intermitent nature, without makingcompliance of applicable provisions of theIndustrial Disputes Act, 1947 is illegal.

Once the workman had earlier declined to get thematter settled in Lok Adalat, he cannot be permittedto take shifting stand at a later stage, to take benefitof Lok Adalat.

Circular cannot be made the basis of anyadjudication in the Court since it was issued tosettle the matters through Lok Adalats.

Since appellant, a casual workman engaged for awork of intermittent nature, stood retrenchedillegally way back, without making compliance ofapplicable provisions of the Industrial DisputesAct, 1947, lumpsum compensation in lieu ofreinstatement and back-wages is appropriate.

Gauri Shanker vs. State and Another. 2014-II LLJ689 (Raj. H.C.)

Leaving the workman to collect the amountof retrenchment compensation at some laterdate and that too without even disclosing himfrom where, at what time and when, cannot besaid to be in compliance of section 25F of theIndustrial Disputes Act, 1947.

Non-compliance of principle of "Last come, firstgo" while effecting retrenchment is violation ofsection 25G of the Industrial Disputes Act, 1947.

When the post was available and some otherparson had been recruited in the place of workmanwithout any information to him, this is violation ofprovisions of section 25H of the Industrial DisputesAct, 1947.

When the retrenchment of a workman is inviolation of the applicable provisions of the

Industrial Disputes Act, 1947, the workman wouldbe entitled to reinstatement with full back-wages.

Radhey Shyam vs. The Presiding Officer, LabourCourt, Jalandhar, and Others. 2014 LLR 888 (P&H

H.C.)

TerminationIf termination of services of the workman is

quashed, it would attract reinstatement, back-wages and continuity of services.

Termination of services of the workman whohad completed continuous service of 240 workingdays during the preceding calendar year withoutnotice pay or notice and retrenchmentcompensation is bad being violative of section 25Fof the Act, liable to be set aside.

While exercising the powers of writ jurisdictionunder Article 226 of the Constitution of India, theHigh Court will not convert itself into a Court ofAppeal.

The High Court under writ jurisdiction caninterfere only where the judicial conscience dictatesit to act lest a gross failure of justice or graveinjustice has taken place or where the error of lawhas to be apparent on the face of the record.

If the statutory provision is capable of twoconstructions and one of it had been adopted by theTribunal, it may not be desirable to correct the samebe way of writ of certiorari by the High Court.

The Deputy Excise and Taxation Commissioner(Sales Tax), Kaithal & Others vs. Presiding Officer,Labour Court & Another. 2014 LLR 817 (P&H H.C.)

The onus to prove the 240 working dayscontinuous service during the precedingcalendar year is always upon the workman byleading cogent evidence.

If the workman fails to discharge his burdento prove continuous working of 240 workingdays during the preceding calendar year, hisclaim is not sustainable.

Mere non-production of muster rolls per se,without any plea of suppression by the workman,will not be the ground for the Tribunal/LabourCourt to draw an adverse inference against theManagement.

If the Management fails to produce the record ofattendance and payment of wages, when ordered bythe court on the application of the workman, thenthe Court may take an adverse inference against theManagement, holding that the plea of the workmanfor completing service of more than 240 workingdays with the Management, stands proved.

If the workman fails to move any application,calling for the records of the Management, taking ofadverse inference against the Management is notcalled for.

Simla Devi vs. Presiding Officer, IndustrialTribunal-cum-Labour Court, Panipat & another.

2014 (141) FLR 856 (P&H H.C.)




Trade UnionsWhen the election of the office bearers of

the trade union was conducted by districtlabour officer in accordance with the bye-lawsof the union by secret ballot, expenses for theelection is to be borne by the union.

Gyana Pattnaik, General Secretary, TataRefractories Shramik Sangh vs. State

Implementation Officer-cum-Labour Commissioner,Orissa. (2014)1 SCC (L&S) 810

TransferTransfer of an employee holding a

transferable post, cannot be interfered by theCourt under writ jurisdiction, if it is notchallenged on the ground of mala fide.

B. Thiruvelan vs. The Executive Director (ConsumerSales) Indian Oil Corporation Ltd. Mumbai and

Others. 2014 LLR 830 (Mad. H.C.)

Unauthorised AbsenceIt is not absolute proposition that whenever

workman is unauthorised absent from longperiod, employer should record finding ofwilful absence through enquiry. In such case ofabsence of morethan one and a half year,dismissal is justified.

It is the duty of the employee to maintaindiscipline, act with responsibility, perform withsincerity and serve the organisation withhonesty.

Chennai Metropolitan Water Supply and SewerageBoard and Ors. vs. T.T. Murali Babu. (2014)2 SCC

(L&S) 38

Dimissal not justified for 13 days absence.

Dismissal from service on account ofabsenteeism for 13 days is shockinglydisproportionate and non-justified to the gravity ofthe misconduct.

Punishment of only depriving back-wages isappropriate keeping in view the 15 years' longservice of the workman and 13 days unauthorisedabsenteeism.

Granting back-wages is not led any evidencebefore the Labour Court that he was not gainfullyemployed after his dismissal from service despitehis best efforts in search of a new job.

If the charges are held to be proved byconducting enquiry and the enquiry was notchallenged by the workman, granting back-wagesby the not Labour Court to the workman is notjustified.

Namdeo Vanji Bachav and Others vs. Dhule DistrictCentral Cooperative Bank Ltd. and Others. 2014 LLR

857 (Bom. H.C.)

V.R.S.When the voluntary retirement opted by

employees accepted by the employer and thepayments were already received by themwithout demur, employee-employerrelationship ceased enabling the employees toraise any demand in respect of benefits of theirservices from the employer.

Appellants have no legal right to demandanything else which is not mentioned in thecontract of Voluntary Retirement Scheme.

Since Scheme of Performance Linked Incentive(SPLI) is not there in VRS, no revision in VRS onaccount of other account tainable pay revision orany in future is maintainable.

After receiving payments towards VRS, theappellants are barred by principle of estoppel andwaiver for claiming SPLI.

The Claim of the appellants, raised after 3 yearsof accepting VRS without any demur, suffers fromabnormal delay without plausible explanation.

P. P. Vaidya and Others vs. IFCI Ltd. and Others.2014-II LLJ 721 (Delhi H.C.)

The voluntary retirees are not entitled to thebenefit of arrears of pay revision since theemployer never intended to extend suchbenefits to them under the Scheme of voluntaryretirement.

The terms "superannuation" and "voluntaryretirement" have two different and distinctmeaning.

Definitions given in respect of sections 2 (q) and2 (r) of the Payment of Gratuity Act, 1972 areapplicable for the purpose of Gratuity Act andcannot be applied in other cases.

The voluntary retirees are only entitled to thebenefits which are mention in the Scheme itself andnot otherwise.

Bharat Pumps and Compressors Ltd., Allahabad vs.Anand Kumar and Others. 2014 (141) FLR 990 (All.

H.C.)

Workers DuesRights accrued to workman under

Industrial Disputes Act and Payment ofGratuity Act shall have presedence over rightsof state financial corporation. Merely becausefinancial corporation sold the properties ofthe company before realisation of dues ofworkmen, rights accrued to workers cannot bedestroyed.

Asst. General Manager, Karnataka State FinancialCorporation vs. General Secretary, Mysore Division

Industrial Workers General Union and Others.(2014)2 SCC (L&S) 34

Courtsey - Labour Law Reporter, FLR, CLR , LLJ & APS Labour Digest

BM



The Apprentices (Amendment) Bill, 2014was introduced in Lok Sabha on August 7,2014 and passed on 14th Aug. It proposes toamend the Apprentices Act, 1961.Definitions: The Bill amends the definitionof appropriate government to include anestablishment operating in four or morestates to be regulated by the centralgovernment. It also amends the definitionsof: (i) designated trade, (ii) graduate ortechnician apprentice, (iii) trade apprentice,(iv) industry and (v) worker. The Bill addstwo definitions: (i) optional trade, and (ii)portal-site.Minimum age for an apprentice: The Actsets the minimum age for being engaged asan apprentice at 14 years. The Bill adds thatthe minimum age for apprenticeship indesignated trades related to hazardousindustries shall be 18 years.Number of apprentices: The Act says thatthe central government, after consulting theCentral Apprenticeship Council (CAC)established under the Act shall determinethe ratio of trade apprentices to workers(except unskilled workers) for eachdesignated trade. The Bill states that thecentral government shall prescribe thenumber of apprentices to be engaged by anemployer for designated trade and optionaltrade.Cooperation between employers fortraining: The Bill permits multipleemployers to come together, eitherthemselves or through an approved agency(only themselves as per the Act), to provideapprenticeship training (practical trainingas per the Act) to apprentices under them.Practical training to apprentices: TheAct states that every employer shall makesuitable arrangements in his workshop forimparting practical training to apprentices,as per the programme approved by theAdviser. The Bill removes the requirementfor Adviser's approval.Basic training to apprentices: The Actstates that trade apprentices who have notreceived prior institutional training shall be

imparted basic training before admission inthe workshop for practical training. TheBill specifies that such training can beprovided in any institute with adequatefacilities.Syllabus and equipment for practicaltraining: The Act states that the syllabusand equipment for practical training shallbe as approved by the central government(with CAC consultation). The Bill limits theprovision for training in a designated tradeonly.Grant of certificate: The Act specifiesthat every trade apprentice should appearfor a proficiency test conducted by theNational Council for Vocational Training(NCVT), on completion of his training. Onpassing the test, NCVT shall grant him acertificate of proficiency. The Bill adds thatsuch tests may be conducted and certificatesmay be granted by other authorisedagencies as well.Hours of work, overtime, leave andholidays: The Act states that the weeklyand daily hours of work and leaveentitlements of an apprentice shall be asprescribed by Rules. The Bill states that thehours of work and leave will be as per thediscretion or policy of the employer.Offences and penalties: The Act specifiescertain offences which are punishable withimprisonment up to six months or with afine (quantum unspecified) or both. The Billspecifies the amount/maximum amount ofthe fine and removes the provision forimprisonment for such offences.Power to make Rules: The Act permits thecentral government (after consulting withthe CAC) to make Rules for implementingthe Act. The Bill states that these powersshall include the power to make Rulesretrospectively with effect from a date on orafter the President grants his assent to theBill. No Rule shall have a retrospective effectif it prejudicially affects the interests of anyperson to whom such Rule may beapplicable.

(Alok Rawat, PRS Legislative Research)

Salient features of The Apprentices(Amendment) Bill 2014

Definitions

Minimum age foran apprentice

Number ofapprentices

Cooperationbetween employersfor training

Practical training toapprentices

Basic training toapprentices

Syllabus andequipment forpractical training

Grant of certificate

Hours of work,overtime, leave andholidays

Offences andpenalties

Power to makeRules:

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Any person, irrespective of his/her age,who is appointed in an establishment ascovered by the Employees' ProvidentFunds & MP Act on the salary less than Rs.6,500 per month, is liable to be covered

under the Employees' Provident Funds Scheme on thefirst day of his/her joining. However, when the wage orsalary of a newly appointed employee is above theprescribed ceiling i.e. Rs.6,500 per month and who hadnot been the member of the Employees' ProvidentFunds earlier, he will not be obliged for themembership of Provident Funds and the Scheme sincehe will be termed as an 'excluded employee'. Be itclarified that once an employee is enrolled as amember of the Fund, he will continue to remainmember atleast upto his salary cap (prescribedmaximum) for subsequent period of employment. Forinstance, if an employee is drawing Rs.6,000 permonth, he will be member of the fund. Assuming, hissalary is increased to Rs.7,000 per month, the employerwill be under an obligation to continue him as amember of the Fund atleast upto Rs.6,500 per month.

Note : The above illustrations are given on the presentwage cap of Rs.6,500 per month for coverage of anemployee. It is pertinent to state that the wage cap forcoverage of an employee is likely to increase Rs.15,000per month.

Part-time employees, probationers, piece rated,temporary or a daily wagers, employees working attheir homes or workers of the contractor (when notcovered by the contractor) or the apprentices otherthan those engaged under the Apprentices Act orengaged under Industrial Employment (StandingOrders) Act, 1946 are also covered under the Act.

There are, however, certain categories of employeeslike those working in Newspaper establishments forwhom there is no salary ceiling for coverage under theAct and the Scheme and also the International workersfrom or with the countries with whom the India does

not have social security agreement are to be covered ontheir full salary.

If an employee, as covered under the Act, continuesafter his/her retirement on attaining the 55 or 58 yearsand has not settled his dues, the EPF contributions willbe payable. Similarly, if a retired employee from thegovernment service is engaged in an establishment, hewill be covered under the Act (if his wages are lessthan the prescribed cap) because Employees' ProvidentFund Act is not applicable upon the governmentemployees and as such they will not be treated as an'excluded employee'.

'Casuals' regularly employedEmploying 'casual workers' month after month and

year after year cannot be due to some abnormalcontingency or emergency and hence, it is not possibleto hold that the provisions of the Act do not apply tothe establishment.

M/s. Autocrat Tours vs. Regional Provident FundCommissioner, 2004 (102) FLR 268: 2004 LLR 780 : 2004LIC 2249 (Del. HC).

Director of a companyThe Patna High Court has held that the directors

are not 'employees' even if they get remuneration.

Union of India vs. Patna Tyre House Pvt. Ltd., 2004(101) FLR 666 : 2004 (1) LIC 727 : 2004 (3) LLN 397 (Pat.HC).

Partner not coveredA partner of the firm cannot be construed as an

employee.1 However, the partners of an establishmentreceiving salaries will not be included as employees forits coverage under EPF & MP Act.2

1. Prakash D. Shah and others vs. Union of India,through the Ministry of Finance and another, 2003 LIC3631 : 2004 (100) FLR 856 : 2004(1) LLJ 943 : 2004 LLR 218

‘Employee’ under Employees ‘ Prov

iden

t

Fund

H. L. Kumar

Advocate, Supreme Court,New Delhi

‘Employee’ under EPF



: 2004 (1) LLN 987 : 2004 (1) CLR 68 : 2004 (105) FJR 844(Bom. HC)

2. Om Roller Flour Mills vs. Union of India, 2002 LIC1229 : 2002 LLR 683 : 2002 LIC 1229 : 2002 (IV) LLN 127 :2002-III LLJ 228 (Cal. HC)

Sons of ProprietorIn one case, three sons of the proprietor who were

in the employment and were being paid wages, it hasbeen held that they will be deemed as 'employees' andliable to be covered under the Act.

Goverdhanlal Purohit vs. R.P.F. Commissioner, 1993LLR 575 (P&H HC).

Piece-rated employeeThe petitioner engaged in manufacture of eatables

and selling them at the counter has been engagingneedy women to manufacture the items and were paidon piece rate basis.

Shree Kutchi Visha Oshwal Mahila Mandal vs.Union of India, 1992 LLR 584 (Bom HC)

Managing Director/Director

Managing Director or the Director of a Companycannot be an employee to be covered under theEmployees' Provident Funds & Misc. Provisions Act.

Sanatan Ghosh vs. Regional Provident FundCommissioner, 1990 LLR 742 (Cal HC)

Retired employee employed after settlement

In one case, the Bombay High Court has held that anemployee retired after 55 years will not be liable to becovered under Provident Fund Act on his re-employment if he has already withdrawn his fullamount of accumulation on his retirement.1 However,the Calcutta High Court has not subscribed the viewtaken by the Bombay High Court.2

1. The Bombay Printers Ltd. vs. Union of India, 1991LLR 443 (Bom HC)

2. Employer in relation to the Management of CalcuttaTelephone vs. Presiding Officer Central GovernmentIndustrial Tribunal, 2001-II CLR 108 (Cal HC)

Director of a company when coveredDirectors of a company working on part-time basis

discharging extra duties apart from Director, will beemployees under Employees' Provident Funds &Miscellaneous Provisions Act.

Tin Printers (Pvt.) Ltd vs. Regional Provident FundCommissioner, West Bengal, (2001) 88 FLR 187 : 2000 LLR1175 (Cal. HC)

Apprentices when doing work ofemployees

Persons engaged as apprentices but required to dowork of regular employees are rightly covered underProvident Funds Act.

N.E.P.C. Textile Ltd., Rep. by its Director, Coimbatorevs. Asstt. P.F. Commissioner, Coimbatore, 2007 LLR 535(Mad. HC)

No distinction between regular orcasual employees

Provident Funds Act, does not distinguish betweenregular employee or casual or those engaged throughthe contractor.

Jaggi & Co. vs. Presiding Officer, Employees' ProvidentFund Appellate Tribunal, 2008 LLR 126 (Del. HC)

Home workersHome workers as covered under the Beedi Cigar

Workers (Conditions of Employment) Act will becovered under the Act.1 The Madras High Court hasalso held that Weavers/Artisans working at home willalso be covered by EPF & MP Act as employees.2

1. Baji Beedi Factory vs. The Appellate Authority,1998 LLR 23 (Kant HC)

2. Padiyur Sarvodaya Sangh vs. Union of India,New Delhi, 1999 LLR 551 (Mad HC)

Drivers & conductors of school busesA school, covered under the Employees' Provident

Funds Act, will not be liable for payment ofcontributions of the employees such as drivers,conductors or the cleaners as engaged by the transportcontractor for providing transportation to the studentsand the staff since the Management has been paying foreach trip of the buses and did not have any casual oreven remote connection over the employees as engagedby the contractor who were not working at the premises.

Springdales School vs. Regional Provident FundCommissioner, 2006 LLR 47 (Del HC)

Drivers of executive when coveredThe drivers, as engaged by the Managers of the

Company whose wages are reimbursed by theCompany through the Managers, will be covered underthe Employees' Provident Funds & MiscellaneousProvisions Act, since the Company has been providinguniforms, foot wears, monsoon equipment, winterclothing and even overtime when their services wererequired by their Managers beyond their duty hours.1In another case the Karnataka High Court has heldthat the drivers, engaged by the executives, will not betreated as employees of the Company for coverageunder Provident Fund Act.2

1. BASF India Ltd. vs. M. Gurusamy, RegionalProvident Fund Commissioner, Maharashtra and Goa,(2004) 2 Mah. LJ 164 : 2004 LLR 463 (Bom. HC)

2. Employees' Provident Fund Organisation vs. L&TKomatsu Ltd., 2009 LLR 1274 (Karn. HC)

Forum for clarification when the statusof employee is doubted

If any question arises whether an employee isentitled or required to become or continue as amember, or as regards the date from which he is soentitled or required to become a member, the decision,thereon of the Regional Commissioner shall be final.Provided that no decision shall be given unless boththe employer and the employee have been heard. Para26B of the E.P.F. Scheme pertaining to resolution ofdoubts is applicable only when the dispute is betweenthe employer and employee. BM

Rakish Iron and Steel Company is asignificant player in the iron and steelindustry. The company has a workforce

of 18,000. With a 21 per cent market share at thenational level, it occupies the fourth position inthe industry. The company set for itself anambitious target of securing the third positionin three years, the second position in sevenyears, and industry leadership in ten years. Themanagement of Rakish announced a majorchange in the business strategy of the companythat would lead to the transformation ofbusiness operations. Incidentally, it prepared ablueprint for the company and chose productdifferentiation as its primary strategy for thefuture.

It identified a few segments in the marketlike the low-value steel market where thecompetition was negligible. It decided toexpand its product line with a focus on theconsumers of these low-value products.

Pursuing this strategy, the managementannounced a slew of measures aimed atenhancing the width of the product line byadding a few more varieties to it. It made ahuge investment commitment in theinfrastructure for producing low-value steel.Within a remarkably short span of time, itintroduced new products to cater to themarket demand for low-value products. Themarket responded favorably to its newproducts and the turnover and profit roseappreciably. However, the competingcompanies understood the game plan ofRakish quickly and reacted by expandingtheir product line too. The advantage enjoyedby Rakish turned out to be a short-lived oneand the major players once again began todominate the market.

Once the product differentiation effortsfailed, the man-agreement of Rakish changedits strategy and adopted a low-cost strategy.This required the organization to be aggressivein sales promotion measures and diligent incost reduction in fields like marketing,advertising, distribution and services. The costreduction measures could not help thecompany for two reasons.

One, the cost of marketing did not have asignificant influence on the price tag of the

product. And two, the cost reduction efforts hada negative fall-out on sales promotion and alsoon the actual sales performance. Eventually, thecompany was forced to abandon its low-coststrategy endeavours.

When the company was almost cluelessabout its future strategies to accomplish theperformance goals, Mr Rajesh Sharma joinedthe board as the HR Director of the company.Learning about the ill-fated strategy initiativesof the company, he made a proposal to developthe work-force of the company as a competitiveadvantage in the market. The board ofdirectors greeted the proposal with suspicionand contempt.

They could not believe that the employeescould be developed into a formidable force forthe organization through proper HRmeasures, and that in due course this wouldlead to cost reduction and qualityenhancement. However, having no worthwhilealternative schemes, they set aside theirreservations and approved the HR director'sproposal. Simultaneously, the directorsallowed a huge budgetary support fordrastically improving the traininginfrastructure and the compensationpackages. The HR director's proposal began totake shape and the management kept itsfingers crossed.



Readers are invited to send solutions.Best will be published.

Can HR be a competitive advantage?

- Pravin DuraiAssociate Professor of Commerce, St Joseph’s College ,Tiruchirappalli

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Questions

1.What could have been the reason for thefailure of the earlier strategies of Rakish?

2.How do you foresee the future of Mr.Rajesh Sharma's proposal in the light ofthe competition faced by the company?

3. What would your proposal have been ifyou had been the HR Director of thecompany?



1. What could have been the reasonfor the failure of the earlier strategiesof Rakish?

Rakish Iron & Steel Company was the4th largest company in the industryhaving 21% market share. The companyset itself an ambitious target of beingindustry leader in the next 10 years andaccordingly prepared a blueprint onhow to go about it. The companyannounced a slew of measures thatwould lead to transformation of itsbusiness operations. Productdifferentiation was identified as itsprimary strategy for the future andaccordingly few market segments wereidentified where low-value steel was indemand and competition was negligible.This strategy was very well received bythe market initially leading to increasein turnover and profits for the company.However, competing companies werequick to follow suit with similar strategyand began to dominate the market.One of the reasons for the failure of thestrategies of Rakish Iron & SteelCompany could be the allocation ofresources. The failure to allocateappropriate resources or balanceresources to accomplish the strategiesfrequently implies that some of theplans are not accomplished due toinsufficient resources, while other plansare accomplished inefficiently becauseof too many resources which could bethe case here.Performance Projections - Rakish Ironand Steel Company has designed astrategy to achieve market dominanceposition and how to go about it i.e. to winin competitive situations. However,before setting its goals, it should havealso studied and made note of as towhere competition would likely be in thefuture. It is up to the company'sleadership to study, understand thelikely future performance levels of keycompetitors and then set goalsaccordingly. Data from competitors, keybenchmarks, and/or past performanceform a valid basis for comparison.Expected future levels of competitor orcomparison performance could be used

to set and validate Rakish company'sown plans and goals. Unless it is done so,Rakish Iron and Steel Company mayfind itself achieving the goals it has setfor itself and still lose - finding itselfbehind the competition. In a competitivemarket, it is not good enough to achieveit's goals unless they place the companyin a winning position.

2. How do you foresee the future ofMr. Rajesh Sharma's proposal in thelight of the competition faced by thecompany?

Mr. Rajesh Sharma, newly joined HRDirector of Rakish Iron and Steelcompany, learn't about the ill-fatedstrategic initiatives of the company,made a proposal to develop theworkforce of the company as acompetitive advantage to secure marketdominance position. Mr. Sharma'sproposal to develop the workforce wouldlead to cost reduction and qualityenhancement. The Management of thecompany approved a huge budgetarysupport for drastically improving thetraining infrastructure and thecompensation packages. The proposalwas slowly beginning to take shape.By definition, plans describe activitiesor actions that have not yet taken place.Many a times in order to execute theplans, the workforce must possess skills,knowledge, or abilities that they do notcurrently possess. Without appropriateplans to develop, acquire, or motivatethe human resources necessary to carryout desired actions, Rakish Iron andSteel Company may not be able toachieve its strategic objectives. Theworkforce may not have the skills,knowledge, or abilities to carry out theactions required for success in thefuture. Hence Mr. Sharma's proposalmay trigger the much needed desiredchange that will enable the company toachieve its goals.Organizations must invest in theirpeople to ensure they have the skills fortoday and to do what is necessary tosucceed in the future.

3. What would your proposal have

been if you had been the HR Director ofthe company?

The following would have been myproposal as HR Director of Rakish Iron &Steel Company:

Communicate the strategy and itsrelated action plans to the workforcethus enabling them to know as to whatis required of them rather than leavingit to guess work.Workforce Development by ensuringthat clear linkages exist between thecompany's strategic objectives andeducation and training. Workforce skillsare developed based on work demandsand workforce needs. Ensure that thetraining plans are developed based onworker and manager input.Address key issues of training anddevelopment, hiring, retention,workforce engagement, involvement,empowerment, and recognition andreward as a part of the human resourceplan. Define appropriate measures andtargets for each.Develop relevant metrics to monitorprogress thus sending a clear messageto the workforce that the plans areimportant. Prompt and regularfeedback is provided to teams andindividuals regarding theirperformance. Feedback covers bothresults and processes.Redesigning work to increase workerresponsibility. Broadening workerresponsibilities; creating self-directedor high performance work teams.Form partnerships with educationinstitutions to conduct student researchand develop workers and ensure asupply of well-prepared futureemployees.Developing gain-sharing or equitybuilding compensation systems for allworkers to increase motivation andproductivity. Compensation,recognition, and rewards/ incentivesare provided for results, such as forreductions in cycle time and exceedingtarget schedules with error-freeproducts or services at less-than-projected cost.

MIHIR GOSALIA

Assistant Manager, ISO -Quality, Kesari Tours Pvt. Ltd.,Mumbai

Develop relevant metrics to monitor progress

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Legal Framework on

Electronic Commerce AndIntellectual PropertyRights In CyberspaceAuthor : Pavan DuggalPublisher : Universal Law Publishing Co. Pvt. Ltd., A-58, G.T. Karnal Road Industrial Area, (Near AzadpurMetro Station), Delhi-110 033Price : Rs. 425/- Website: www.unilawbooks.com

Unlike other areas of legal discipline, Cyberlaw as a phenomenon is a constantlychanging paradigm. As such, there is a need for constantly improving theexisting legal frameworks so that the cause of electronic commerce, mobilecommerce and electronic governance can be given a further fillip.

Thus, there is an urgent need that legal frameworks impacting electronic commerceneed to have not just topicality and relevance for the different stakeholders in thedigital and mobile ecosystems but more significantly, need to have the relevantrobustness so that they can withstand the test of time.

Given the dynamic nature of Cyberlaw as a legal discipline, it is but natural that theseframeworks will not be solidified in stone but will have to be constantly updated so asto meet the requirements, expectations and demands of the various stakeholders ofthe digital and mobile ecosystem as also for ensuring stability and reliability of legalregimes, in the context of ever-growing electronic commerce and mobile commercerealities of today.This book is targeted for every stakeholder of the digital and mobileecosystem, who is connected with any activities pertaining to the digital environmentin any manner whatsoever.

Practical Guide toFactories ActAuthor : H.L. KumarPublisher : Universal Law Publishing Co. Pvt. Ltd., A-58,G.T. Karnal Road Industrial Area, (Near Azadpur MetroStation), Delhi-110 033Price : Rs. 350/- Website: www.unilawbooks.com

The interpretation of provisions of the Factories Act depends upon the facts andcircumstances of the case, provisions and the rulings of the similar courts on theissue and the decisions of the Supreme Court.

The Factories Act has to be interpreted keeping in view the goals set out in thePreamble of the Constitution of India and Directive Principles of State Policy and not byattractive mantras of globalization and liberalization. An interpretation would advancethe object and purpose of the legislation, must be placed and given full meaning andeffect to in the achievement of its avowed social objective. In this revised edition, thejudicial pronouncements, with direct bearing on the relevant sections, have beencarefully analysed so as to help better understanding of their import as well as to knowtheir applicability. For convenience of ready reference, the heading and sub-headingshave also been arranged in their proper order and sequence.

It would be a great time saver for the factory manager as a reference. It is hoped thatthe book will prove to be an indispensible companion for all those who are concernedwith labour, particularly industrialists, factory owners, corporate bodies, and all otherswho are, in any way, interested in the subject matter of this book.

Vishwa Kalyan KamgarSanghatana and the Bajajmanagement have finally settledtheir differences and arrived at anamicable agreement. salientfeatures of the settlement are :

1. Wage rise: Rs 10,000 for those withservice more than 5 yrs., Rs 9,500for those with service more than 3yrs., and Rs 9,000 for the rest.

2. The 60% of the above amount shallbe given in Basic Pay and rest inallowances.

3. The existing Variable DearnessAllowance Scheme will continue.

4. Canteen services which chargedRs 100 pm will now be free.

5. Transport: The deduction for thoseavailing transport is reduced fromRs 530 to Rs 350.

6. Monthly Attendance RewardScheme has been introduced andshall be paid @ Rs. 1000/- p.m. forfull attendance.

7. The existing Regular AttendanceBonus of Rs. 480/- is revised andRs. 240 shall be merged intoallowances and rest Rs. 240 hasbeen divided into weeklyattendance allowance @ Rs. 60 perweek.

8. The Performance Appraisalprocess will continue as per the present practice and it will be used for career planning andup-gradation. However, the samewill not be considered forincrement / CTC by way of reviewprocess.

9. Management and Union agreed towithdraw all the cases related toChakan factory, filed before theJudiciary / Court, GovernmentAuthority against each other,within fifteen days from the date ofsettlement.

10. The settlement is valid till31.March.2016

11. The settlement also defines production/ productivitynorms.

(Source : Vivek Patwardhan blog)

Bajaj settleswage dispute

with union

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ITM Group of Institutions announces the launch of 'ITM University Online'.The e-learning platform is being launched with ITM's flagship MBA program.ITM envisions fulfilling the need-state of providing much needed business and

management training to young working professionals, using the latest educationtechnology and a modern curriculum, in order to transform economies andsociety. Unlike traditional distance learning programs, the Online MBA leveragestechnology to provide a multi-channel learning experience, combining eBooks,video streaming, social media and online collaborative tools, as well as a livevirtual classroom experience. What's more, to overcome the disadvantages of e-learning, students will have unprecedented access to faculties, during theircourse of study. The courses have intentionally been kept flexible to enablestudents to learn at their own pace, given their other commitments, irregularavailability of time, and other constraints. The classes will commence inSeptember 2014 with admissions being opened by the July 21, 2014. Students willundergo a rigorous and thorough curriculum that is designed by a team of highlyexperienced in-house faculties, validated by industry experts and includes a widerange of courses, covering a broad swath of business areas.

On the juncture of launching the online university, ITM organized a paneldiscussion on 'Making e-learning more effective'. The panel's objective was to bringtogether leading thinkers and visionaries like Mr. RV Bala Iyer, Vice Presidentlearning and development, Reliance Jio Infocomm Limited, Mr. RustomVesavevala, Vice President learning and development, Indian Group of Hotels,Mr. Kaviarasu R, Chief Manager learning and development, Asian PaintsLimited from a cross section of industry and academia to share and discovervisions for future of e-learning in the workplace and classroom, and looking atthe challenges & mindsets that are faced by the e-learning platform.

Mr. Nitin Putcha -Executive Vice President says "The appetite for e-learningis growing on a global scale. By 2015, Asia will account for the second highestexpenditures after North America,. The e-learning market in India is expected togrow at 20% with increased internet penetration; hence we at ITM are lookingforward to building an e-learning platform that can be considered a benchmark ofacademic quality, and learning experience in India."

EventReport

ITM-Group launchesOnline University

Coal India (CIL) has been forced totake back 122 employees who wereterminated in May for indiscipline -an instance that highlights the extentof political intervention in the day-to-day operations of public sectorundertakings.

The workers were terminated duringgeneral elections for not vacating land inlieu of which they were offered jobs inMahanadi Coalfields Ltd (MCL), asubsidiary that contributes to aboutquarter of CIL's production. The employeesbegan agitation, leading to production lossto the company. MCL announced takingback of the employees as a 'goodwillgesture', but officials in the coal ministrysaid the company was under pressure fromlocal politicians to take back the employeesand end agitation that was impactingproduction. While reinstating theemployees, the company has ex-emptedthem from submit-ting affidavit that theywill vacate their dwellings by October

31.Submission of affidavits was a pre-condition to rein-stating the employees asagreed during tripartite meetings heldbetween MCL management, employeesand the district administration. A coalministry official said a written agreementfrom workers was required to pre-ventthem from back tracking.

The employees were recruited in theTalcher coal-field between 1995 and 2009and as per the terms of appointment theywere supposed to vacate their land withinfive months of joining the company. Theemployees did not vacate the land despiteseveral notices by the company. Theterminated employees are backed by localpoliticians and trade unions in agitationsthat threaten closure of mining operationsin Jagarmath area of Angul district inOdisha that is expected to supply 40million tonnes coal in 2014-15. MCL isforced to negotiate with them.

Coal India takes back 122workers



Easing Work RuleProposed amendments to the Factories Act 1948

Night Work : Relaxation of norms for woman factory workers

Overtime : Increase in limit to 100 hours (from 50) in a quarter

Safety & Health : Empowerment of the central govt to make rules on“important aspects of occupational safety and health” (at present, thepowers are with only state govts)

Proposed amendment in the Apprenticeship Act, 1961

Employers : Dropping the clause under which employer can beimprisoned for not implementing the Act; a fine of Rs. 500 per shortfall ofapprenticeship month may be imposed

New Trades : Companies can add new trades under the Act without theCentre’s approval

AMBIT : Contractual workers, daily workers, agency workers and casualworkers to come under the Act

Parity : Holidays, leaves, shift working for apprentices to be the same asregular workers

Proposed amendment in Labour Laws Act, 1988

Registers : Reducing the need for small establishments to maintainregisters under the Scheduled Acts to two ; very small establishments tomaintain only one register

E-Records : Maintenance of records in electronic media

Definition : ‘Small establishments’ to mean firms employing between 10and 40 people

Lok Sabha passed the Apprentices (Amendment) Bill 2014in parliament on 14th August but other bill pertaining toamendments in Factories Act could not be passed. WhileApprentices bill now further has to be passed by RajyaSabha, which will happen in next winter session,Factories (Amendment) Bill still has to wait till nextsession for Lok Sabha.

While the amendment to the apprentices Act will help absorbmore freshers in the manufacturing sector, changes in factoriesAct are being considered to allow companies to scale upoperations through extended hours of work. The proposedchange in the Labour Laws (Exemption from FurnishingReturns and Maintaining Registers by Certain Establishments)Act will simply filing of returns and reduce hassles forcompanies.

In case of the apprentices Act, a labour ministry note said theproposal is to enhance the scope of apprenticeship training to allgraduates in various field such as BA, BCom and BSc other thanthe those having a technical education from it is or engineeringcolleges. Also, the proposal is to make it mandatory for industryto keep the number of apprentices to 2.5-10% of the total workerswith the flexibility to take into account seasonality in operation.

The government also wants to extend the period ofapprenticeship training to a maximum 5 years from the present6 months to 4 years to encourage skill building.

Also, companies can be allowed the flexibility to frame theirown policies on whether to retain an apprentice or not aftercompletion of training. Under the present rule, companies arenot bound to offer any employment to any apprentice who hascompleted the period of his apprenticeship training in hisestablishment, nor it is obligatory on the part of the apprenticeto accept an employment under the employer. While this is animpediment which discourages youth to join the apprenticeshiptraining as they are not sure whether they will get employmentafter completion of the apprenticeship training, companies arealso wary of imparting training to freshers fearing that theymay join competitors at a higher salary after the training.

The government also proposed to dilute the penalty under theapprentice Act. Due to fear of imprisonment, employers tend toavoid coming under the purview of the Act and trainingfacilities available with them go unutilized. The governmentmay propose that the penalty should be Rs 1,000 everyoccurrence of the offense of not meeting the apprentice quota.

Apprentices Bill passed in Lok Sabha, others to wait

In case of the Factroies Act, the labour ministry proposes toallow companies to hire women workers for night shifts whiledoubling the overtime to 100 hours in a quarter.

Though discussion has started in amending the politicallysensitive Industrial Disputes Act to make hiring and firing easy,the relaxation may first be applicable for National InvestmentManufacturing Zones (NIMZs) and not the entire manufacturingsector. Industry has demanded major changes in the Act,including raising the threshold limit from 100 workers to 1,000 fora company to mandatorily seek government approval forretrenchment, layoffs or closure of an unit.

Changes in MW and Child Labour Act on cardsThe ministry of labour and employment will soonseek Cabinet approval for amendments to threearchaic labour laws, kick-starting a long-pendingrevamp of labour market rules with the aim ofbenefitting workers and increasing productivity.

The ministry is finalising changes to the Child LabourAct of 1986 and the Minimum Wage Act of 1948.

As part of the amendments proposed to the MinimumWage \ Act, the ministry will set a national floor forminimum wages for workers across professions, resulting ina significant jump in salaries for workers in theunorganised sector. The minimum wages would be revisedevery five years by the Centre in accordance with the NSSO's

Consumer Expenditure Survey. It would also be revisedevery six months by state governments in accordance withthe Consumer Price Index.

In the Child Labour (Prohibition and Regulation) Act,1986, the proposed amendments will bar children between 14and 18 years from taking up hazardous occupations such asmining related jobs. At present, children under 14 years canwork except in prohibited sectors such as domes-tic work,automobile workshops, bidi making, carpet weaving,handloom and powerloom industry, and mines. The move issignificant as child labour accounts for nearly 8.5% of thecountry's 312 million-strong workforce. Of these, 43.53 lakh children are between 5 and 14 years of age, as per theCensus 2011.



Cos. paying PF on lessthan 50% of wageunder lens of EPFO

The Employees' Provident FundOrganisation will start inspectingcompanies which have split wages arededucting provident fund contributionson 50% or less of total wages.

EPFO's additional central providentcommissioner in charge of compliance PKUdgata said in an internal circular that "allofficers in-charge of field offices are directed toget such establishment inspected where PFcontributions has been deducted on 50% or lessof total wages. "The inspection has to becompleted by field officials and the report to besubmitted to the EPFO head office by September7," the EPFO circular said. Employer often splitwages into different allowances to reduce theirPF liability while increasing the net salary ofemployees. Companies deduct 12 % of basicwages of employees for the PF contribution andmake a matching contribution.

The EPFO noted that many employers weresplitting the total wages payable to theiremployees into several allowances in such away that the said allowances are covered underthe category of exclusions provided underSection 2 (b) (EPF & MP Act 1952). Thisencourages "subterfuge of splitting of wages toexclude the PF liability", the circular said.

As per Section 2 (b) of the Employees'Provident Fund & Miscellaneous ProvisionsAct, 1952, the basic wages for the purpose of PFdeduction includes all emoluments which areearned by an employee's while on duty.However, the clause provides that basic wagesexcludes the cash value of food concession,dearness allowance, house rent allowance,overtime allowance, bonus, commission or anyother similar allowance payable and anypresents given by employer to employees.

Raj.Labour amendments passed in state assembly

Rajasthan Assembly passed the amendments to the labour laws. As perthe amendments to Industrial Disputes Act 1947, companies employingup to 300 workmen would not be required to obtain prior permission ofthe state government for initiating lay offs, retrenchment or closure ofthe establishment. Under the existing rules, the bar was capped at 100employees. The government made changes in the criteria required forgetting status of representative union. Under the current norms, anyunion having a membership of not less than 15% of the totalworkforce in any company may seek such status.

The existing lower limit allowed many unions to come up often increasinginter-union conflicts and multiplicity in an industry. To minimize this, thegovernment increased the membership from 15% to 30% for getting solebargaining power. This amendment is also in sec. 9-D of chapter II-B of I.D. Act(state amendment) and not in Trade Unions Act as generally understood.TheRegistration of Trade Unions is still at 10% of membership. The current rulesalso set no time limit for raising disputes arising out of discharge, dismissal,retrenchment or termination. But the amendments have brought in a time-limit of three years within which such disputes can be raised. The move isaimed at reducing the volume of litigations for companies. Similarly, as per theamendments, the Contract Labour Act will now apply to every establishmentin which 50 or more workmen are employed. Previously, the Act applied toestablishments in which 20 or more workmen were employed. In the Factories'Act, the definition of "factory" has been amended. It will now apply to thosecompanies (run with aid of power) where at least 20 people are employedinstead of 10. For firms running without power, the number has been increasedto 40 from 20. For speedy disposal of offences and minimizing number oflitigations, a new provision has been inserted to compound offences which ismissing in the existing Factories Act. Moreover, amendments have been madeto ensure that no inspector can initiate any proceedings against any companywithout the prior permission of the government. The state has amendedseveral features in the Apprenticeship Act 1961. The changes cover reducingthe training period, empowering state bodies for grievance redressal,flexibility in deciding the number of apprentices, provision for third-partytraining and allowing minimum wages, which can also be shared by the stategovernment.

Although the amendments to Industrial Disputes Act 1947, Contract LabourAct 1970, Factories Act 1948 and Apprenticeship Act 1961 were hailed by theindustries, trade unions slammed the decision accusing that the move wasunilateral and detrimental to the interests of the workers. Since the Billsrequire the President's approval, the trade unions said they would approach thehighest authority of the country to nullify the state government's attempt.

Air India rationalize unions from 15 to 5Air India has cleared a prop0osal torationalize the number of employees'unions in the company to five from 15.The move is expected to bring inefficiencies with respect to addressingHR- related issues within the airlineand facilitate quicker decision-making.

Under the proposal, Air India will havetwo unions-first for pilots and second forother workers, such as cabin crew andticketing staff. Air India EngineeringServices (AIESL), a subsidiary of AirIndia, will be allowed to have two unionsand the airline's ground handing unit, AirIndia Air Transport Services (AIATSL),has been allocated a single union by themanagement, the official said on thecondition of anonymity. However, severalHR-related issues that date back to the

merger of the erstwhile Indian Airlineswith Air India in 2007 need to be addressedbefore the creation of the new unions, theofficial added. He said the company washolding discussion with employees onmodalities such as the eligibility criteriafor the recognition of existing unions.Merging some entities to create a largerunion, or establishing a new association, isalso a possibility.

At present, Air India has about 15recognised and unrecognised unionsincluding employees' unions of Air India'swide-bodied aircraft operations (thatmostly fly internationally) and theerstwhile Indian Airlines' narrow-bodiedaircraft operations (that flewdomestically). Indian Airlines was mergedwith Air India in 2007. A four-member

committee constituted by the airline'sboard of directors in December 2013 tochalk out a plan for cutting down thenumber or reconginsed unions had earliersubmitted two sets of recommendations.

One of the suggestions was to have threeunions-one each for Air India, AIESL, andAIATSL. The second suggestion, which hasfinally been accepte4d, was to have the fiveunions as described above. A certainsection of the senior management favoureda third alternative to have just two unions-one for pilots and another for the rest ofthe employees. This was severely criticizedby the existing union. The managementdecided to have a separate union for pilotssince there are several practical difficultiesif pilots and other workmen were to be partof one group.



New earners over 15k may be out of Pension CoverNew recruits starting with a basicsalary of over Rs. 15,000 per monthmay be denied pension cover by theEmployees' Provident FundOrganisation (EPFO) even as theycontribute to the provident fund.

While EPFO's corpus and subscriberbase will rise significantly once thegovernment raises the wage ceiling fromRs. 6,500 pm to Rs. 15,000 pm formandatory coverage of provident fund, itwill still come under pressure to pay aminimum pension of Rs. 1,000 per monthfrom its Employee's Pension Scheme(EPS) that already runs a huge deficit.

To limit the losses, the rule change toguarantee a minimum pension will comewith a host of riders.

In an internal circular, EPFO said:"The proposed amendments have aprovision whereby only such new PFmembers shall become EPS (Employee'sPension Scheme)members who se pay atthe time of joining will be less than orequal to Rs. 15,000." For those startingwith a pay of more than Rs. 15,000 permonth, the EPFO circular said "the entireemployer and employee contribution shallremain in the provident fund (EPF) and nodiversion to EPS shall be made". Thismeans new employees getting more thanRs. 15,000 as basic salary will get backtheir accumulated PF amount afterretirement but won't be entitled to anypension. At present, PF contributions ofboth employees and employers areallocated to three funds -- EPF, EPS andEmployees Deposit-linked Insurancescheme (EDLI). Employees contribute 12

The ProposalFor those starting with a pay of more than Rs. 15,000/month, the EPFO circularsaid "the entire employer and employee contribution shall remain in theprovident fund (EPF) and no diversion to EPS shall be made"

This means new employees getting more than Rs. 15,000 as basic salary will getback their accumulated PF amount after retirement but won't be entitled to anypension

In case of employees already making PF contribution on a salary exceeding Rs.6,500, the circular said the employees and employer will have to "exercise a freshoption" to contribute on a salary exceeding Rs. 15,000

Here again, employees will not get the benefit of government contribution of1.16%

The proposed amendment also stipulates that pension amount will becalculated on the basis of average monthly salary for last five years of serviceinstead of the earlier practice of one year

At present, a little over 44 lakh people draw pension, which is 10% of activesubscribers

Labour reforms inhaste a bad idea:ILO India director

Bringing laobur law reformsin haste is not a good idea,according to Tine Staermose,director of InternationalLaobur Organization's (ILO)decent work team for SouthAsia and country office forIndia.

On Rajasthan Assemblypassing four labour amendmentBills recently, Staermose said:"Rushing through such things isa bad idea. It can lead to labourunrest. Investment is ashortsighted way of approachingsuch reforms." "It is true that thelabour laws are outdated, but theindustries do not comply withthe existing norms (either). Theyshould comply before demandinglabour law restructuring," shesaid. Staermose said the ILO wasobserving the moves of theNarendra Modi governmenttoward easing labour laws. "Wewould not like to comment on thechanges that the newgovernment made recently. Butwe are observing and would liketo wait before we finalise ouranalysis," she added.

(Source : Business Standard)

% of their basic salary towards EPF whileemployers con-tribute 3.67% towards EPF, 8.33% toEPS and 0.5% to EDLI. On its behalf, thegovernment contributes at the rate of 1.16%towards EPS. In case of employees alreadymaking PF contribution on a salary exceeding Rs.6,500, the EPFO circular said the employees andemployer will have to "exercise a fresh option" tocontribute on a salary exceeding Rs. 15,000. Hereagain, the employees will not get the benefit ofgovernment contribution of 1.16%. Moreover, theproposed amendment stipulates that pensionamount will be calculated on the basis of averagemonthly salary for last five years of serviceinstead of the earlier practice of one year.

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