Unit 1: Introduction to Labour Legislation

1.​​ What do you mean by Labour Legislation? Briefly describe the principles of Labour Legislation. 2015, 2016, 2018

2. What are the various type of Labour Legislation in India?  ​​ ​​ ​​ ​​ ​​ ​​​​ 2017, 2023

3.​​ Discuss the objectives of Labour Legislation. 2018, 2023

4.​​ Critically examine the utility of labour laws in Indian context.​​ Or Analyze the needs and importance of labour legislation in Indian context.​​ 2014,​​ 2015, 2017, 2019

5.​​ Explain the Directive Principles of State Policy. What are the guidelines to be followed by the State Governments in framing and enforcing labour laws in India? 2016

7. Give a brief account of the origin and growth of Labour Legislation in India. ​​ 2014, 2019

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Meaning of labour legislation

‘Labour legislation’ is a body of law formed for the working class of people to provide them with legal rights, and also restrict them with rules and regulations. It defines the rights and obligations of the working class. Labour law covers several areas:​​ 

1. Certification of Labour Unions: The Labour Union is issued with a formal document which ensures them the right to represent on behalf of all the labourers. This Union acts as an exclusive bargaining agent.

2. Collective Bargaining: The workers through their unions put demands before their employers, like the terms of their employment, payment, leave, health and safety policies and the number of working hours.

3. Labour-Management Relations: The head of any working organisation has to resolve conflict among his labourers because any misunderstanding between his employees will create a downfall in his work progress.

4. Workplace health and safety: It ensures that the employees are getting a safe environment to work in and are not physically or mentally abused by the work culture because a better environment will only make them work with all their might.

5. Employment standards: These include annual holidays, working hours, unfair means of dismissal of labourers, and compensation provided to the labourers who got terminated or have left the job.

Nature/Principles​​ of Labour Legislation

The nature of labour legislation refers to the characteristics and principles underlying laws and regulations concerning employment and workers' rights. Here are some key principles of labour legislation:

1. Protective: Labour legislation is primarily aimed at protecting the rights and interests of workers. It establishes minimum standards for wages, working conditions, safety, and social security to ensure fair treatment of employees.

2. Regulatory: Labour laws set out rules and regulations governing the relationship between employers and employees. They define the rights and responsibilities of both parties and establish procedures for resolving disputes and grievances.

3. Social Justice: Labour legislation is often guided by principles of social justice, aiming to address inequalities and promote equity in the workplace. It may include provisions for affirmative action to support marginalized groups and ensure equal opportunities for all workers.

4. Economic Regulation: Labour laws also play a role in regulating economic activity by setting standards for labour market practices and promoting stability in industrial relations. They contribute to economic development by ensuring a skilled and productive workforce and fostering a conducive business environment.

5. Adaptive: The nature of labour legislation is dynamic and adaptive to changing socio-economic conditions and labour market trends. It evolves in response to emerging issues such as technological advancements, globalization, and shifts in employment patterns.

6. Balanced: Effective labour legislation seeks to strike a balance between protecting workers' rights and promoting economic growth and competitiveness. It recognizes the need to maintain industrial peace while supporting business development and job creation.

Objectives of labour legislation

The main objective of labour legislation is to establish a cordial and peaceful relationship between employers and employees. It aims to maintain harmony between the labour organizations and the public, which would help in improving the working conditions and its environment. Some of the important objectives of labour laws are as follows:

1. Establishment of all kinds of justice for the working people – social, economic, and political.

2. The availability of equal opportunities to all workers, irrespective of caste, creed, religion and beliefs for their overall personality development.

3. Protection of weaker sections of workers who are not financially well off to protect themselves.

4. Maintenance of industrial peace.

5. Protection and improvement of living standards of the labourers.

6. Protection of workers from all sorts of exploitation – mentally or physically and creating a better working environment.

7. Grant rights to workmen to unite and form their unions so that they could bargain collectively with their owners for the betterment of their livelihood.

8. Keep checks on the government about their active participation in the working areas for social well-being.

9. Ensures human rights and human dignity.

Need and Importance of Labour legislation in India

1.​​ Protection of Workers' Rights:​​ Labour legislation is essential to protect the rights of workers, ensuring fair wages, safe working conditions, and social security benefits. This is crucial to safeguard the well-being and dignity of workers across various sectors.

2.​​ Addressing Power Imbalance:​​ Individual workers often have limited bargaining power compared to employers. Labour laws are necessary to address this power imbalance and protect workers from exploitation and oppressive terms.

3.​​ Facilitating Workers' Rights:​​ Labour legislation facilitates and empowers workers within organizations, ensuring their rights are respected and upheld. It provides a legal framework for workers to exercise their rights and seek redressal in case of grievances.

4.​​ Settlement of Industrial Disputes:​​ Labour laws provide mechanisms for the resolution of various industrial disputes, ranging from issues related to wages and working conditions to disputes between workers and employers. This helps in maintaining industrial peace and stability.

5.​​ Enforcing Social Welfare Schemes:​​ Labour legislation helps enforce social insurance and welfare schemes aimed at providing support and benefits to workers and their families. This includes schemes related to health care, education, housing, and other social security benefits.

6.​​ Improving Industrial Relations:​​ Labour laws play a crucial role in improving employee-employer relations and minimizing industrial disputes. By establishing clear rules and regulations, labour legislation fosters better communication, cooperation, and trust between workers and employers.

7.​​ Ensuring Fair Wages and Job Security:​​ Labour legislation ensures that workers receive fair wages for their labour and provides mechanisms for enforcing minimum wage standards. It also helps in ensuring job security for workers, protecting them from arbitrary dismissal or termination.

8.​​ Promoting Healthy Working Conditions:​​ Labour laws promote healthy and safe working conditions in industrial systems, contributing to the overall well-being and productivity of workers. They set standards for workplace safety, hygiene, and occupational health.

9.​​ Regulating Work Hours and Rest Periods:​​ Labour legislation helps in regulating work hours, rest periods, and other aspects of working conditions to ensure fairness and balance. This includes provisions for overtime pay, rest breaks, and leave entitlements.

10.​​ Providing Compensation for Accidents:​​ Labour laws provide mechanisms for appropriate compensation to workers who are victims of accidents or suffer work-related injuries. This ensures that workers are not left financially vulnerable in case of injury or disability.

Classification of Labour Legislation

On the basis of specific objectives, which it has sought to achieve, the labour legislations can be classified into following categories:​​ 

A. Regulative​​ 

B. Protective​​ 

C. Wage-Related​​ 

D. Social Security​​ 

E. Welfare both inside and outside the workplace.​​ 

A. The Regulative Labour Legislation:​​ The main objective of the regulative legislation is to regulate the relations between employees and employers and to provide for methods and manners of setting industrial disputes. Such laws also regulate the relationship between the workers and their trade unions, the rights and obligations of the organizations of employers and workers as well as their mutual relationships.​​ 

1. The Trade Unions Act, 1926​​ 

2. The Industrial Disputes Act, 1947​​ 

3. Industrial Relations Legislations enacted by states of Maharashtra, MP, Gujarat, UP, etc.​​ 

4. Industrial Employment (Standing Orders) Act, 1946.

B. The Protective Labour Legislations:​​ Under this category come those legislations whose primary purpose is to protect labour standards and to improve the working conditions. Laws laying down the minimum​​ labour​​ standards in the areas of hours of work, supply, employment of children and women,​​ etc.​​ in the factories, mines, plantations, transport, shops and other establishments are included in this category. Some of these are the following:​​ 

1. Factories Act, 1948​​ 

2. The Mines Act, 1952​​ 

3. The Plantations Labour Act, 1951.​​ 

4. The Motor Transport Workers Act, 1961​​ 

5. The Shops and Establishments Acts​​ 

6. Beedi and Cigar Workers Act, 1996

C. Wage-Related Labour Legislations:​​ Legislations laying down the methods and manner of wage payment as well as the minimum wages come under this category:​​ 

1. The Payment of Wages Act, 1936​​ 

2. The Minimum Wages Act, 1948​​ 

3. The Payment of Bonus Act, 1965​​ 

4. The Equal Remuneration Act, 1976​​ 

D. Social Security Labour Legislations:​​ They cover those legislations, which intend to provide to the workmen, social security benefits under certain contingencies of life and work.​​ 

1. The Workmen’s Compensation Act, 1923​​ 

2. The Employees’ State Insurance Act, 1948​​ 

3. The Coal Mines PF Act, 1948​​ 

4. The Employees PF and Miscellaneous Provisions Act, 1952​​ 

5. The Maternity Benefit Act, 1961​​ 

6. Payment of Gratuity Act, 1972​​ 

E. Welfare Labour Legislations:​​ Legislations coming under this category aim at promoting the general welfare of the workers and improving their living conditions. Though, in a sense, all labour-laws can be said to be promoting the welfare of the workers and improving their living conditions and though many of the protective labour laws also​​ contain chapters on labour welfare; the laws coming under this category have the specific aim of providing of improvements in the living conditions of workers. They also carry the term “Welfare” in their titles.​​ 

1. Limestone and Dolomite Mines Labour Welfare Fund Act, 1972​​ 

2. The Mica Mines Welfare Fund Act, 1946​​ 

3. The Iron Ore Mines, Manganese Ore Mines and Chrome Ore Mines Labour Welfare Fund Act, 1976.​​ 

4. The Cine Workers Welfare Fund Act, 1981​​ 

5. In addition, some state governments have also enacted legislations for welfare funds 6. Beedi Workers Welfare Funds Act, 1976

Factors influencing labour legislation

Labour laws were imposed by governments in the earlier times also. It is considered as a set of compliances that set the tone for regulating the employer-employee relationship and the treatment of the labour force in the workplace. Various factors that influence the implementation of labour laws are as follows:​​ 

1.​​ Impact of contemporary events:​​ 

-​​ Along with the Industrial Revolution, the revolutionary thinking of people like Rousseau, J.S Mill, Hegel, Marx and Engels impacted labour jurisprudence. The French and the Russian Revolution greatly influenced the thought process of the public and set the pace of labour jurisprudence. 

-​​ The World Wars also made the labourers realise their core importance, that unless they sweat, it would be hard for the nation to fight and win the rough battles, therefore the masters need to provide a quality of life to their workers.

-​​ The development in the field of science, technology, communication and telecommunication brought the people of different parts of the world closer. This made the people who lived in underdeveloped countries aware of the treatment given to workers in the different parts which created an urge in them to fight for their well-deserved rights.

-​​ Gradually, the labourers got the right to vote in political elections for their representative who would in turn support their demands and work for the legislation to get passed, this is how the workers used their political powers for the betterment of their lives.

-​​ Karl Marx, in his analysis of capitalism, mentioned that the exploitation of the workers was inherent in the capitalist economic system. Therefore, he advocated the overthrow of the capitalist system. There were echoes of slogans like “the workers of the world unite, you have nothing to lose but your chains,” which created fear in the capitalist world and they were left with no choice rather to agree to protective labour legislation. There was the formation of communist and socialist parties which strengthened the trend for progressive labour legislation.

-​​ Philanthropists, humanitarians like Hume, Place, and Shaftesbury, and other social reformers influenced the shape of labour legislation.

2.​​ The establishment of the International Labour Organisation (ILO)​​ 

The establishment of the International Labour Organisation (ILO)​​ was a very potent force in the formation of labour laws all over the world. The acceptance of the principle that “labour is not a commodity” and the slogan that “Poverty anywhere constitutes a danger to prosperity everywhere,” have influenced the course of labour legislation in all the countries.

-​​ It has initiated proposals for labour legislation, had elaborate discussions about it and adopted Conventions and Recommendations.

-​​ ILO has tried very much to form uniform labour standards despite diverse and uneven economic conditions in different parts of the world. It has done a singular service in the field of labour legislation.

Emergence, evolution, and development of labour law in India 

Emergence of labour legislation

The emergence of labour laws has its roots in the 18th and 19th centuries. The labour law emerged as a result of the industrial revolution that took place in those centuries. The Industrial Revolution changed the rural culture to​​ industrial culture which led to various developments. It was due to the increasing capitalisation of the market. At that time, a lot of problems took place between the labour class and the employers. To safeguard the interests and the demands of the labour class, labour laws were enacted in various countries which gave certain rights to the workers working in an establishment. It protected the workers from being exploited by the rich people of industrial society.

The labour laws were first enacted by the Western Countries. England was the first country where workers were exploited by rich upper-class employers. This was due to uncontrolled and unregulated capitalisation. The laissez-faire system was also one of the reasons that took place due to industrialisation. The labour laws were enacted in 1802 to prevent child labour, to limit working hours, and to abolish night shifts in England when the UK Parliament passed bills relating to labour legislation. After England, many other countries also started enacting laws regarding labour classes. Various laws regarding health, safety, welfare, and working hours were passed by those countries. France was one of the countries where labour laws were enacted after the French Revolution, which took place in 1841. Germany, Japan, and the United States of America also introduced labour laws after World War I in 1935. 

Evolution of labour legislation

The evolution of labour laws started with the establishment of the International Labour Organization (ILO) in 1919. It was due to the implementation of the Treaty of Versailles whose objective is to make various policies, and programmes relating to their works and its standards. 187 countries of the World are members of this organisation whose Constitution was drafted by the Labour Commission. It led to the formation of an executive body which was known as a tripartite organization that included representatives from three bodies, i.e., the employers, the workers, and the government. Certain issues relating to the labourers were looked into by ILO. Laws regarding working hours, night shifts, minimum age, unemployment, and maternity protection were being laid down by it to safeguard the rights of labourers. It became a specialized agency of the UN which was supervised by a committee of experts.

India, also, had labour laws before independence. Some of the laws regarding labour classes were The Indian Slavery Act, 1843, The Indian Trade Unions Act 1926, and The Societies Registration Act, 1860. These laws were repealed after India became independent. The Industrial Disputes Act, 1947, was enacted in 1947 which replaced all the previous Acts. Various rights of the workers were introduced to the Indian Constitution for protection from any kind of exploitation. Some rights relating to the labourers that were incorporated in the Constitution are equal work equal pay, abolition of child labour, abolition of bonded labour, decent living wages, maternity benefits, and right to work, just and human working conditions. These are the rights of the workers that are being safeguarded by the Indian Constitution working in an establishment. In the 20th century, these laws were codified and implemented by the Indian Parliament. With the changing times, labour laws started evolving over some time.

Development of labour legislation 

The roots of labour legislation lie in the relentless struggle faced by the workers at their master’s work. There was inequality between two classes of people. The contract between labour and capital could never be struck on equitable terms. Such practices required a change, and this need became the basis for the formation of labour laws.

The Industrial Revolution was an epoch-making event. It transformed the agricultural-based society into an industrial and materialistic one. It gave a great opportunity to the masters to get the best work from their workers. They exploited them excessively for larger profits and greater outcomes.

At that time the laws were of no relief for the workers. Most of the contracts were made verbally and in case of breach, the workers were severely punished and imprisoned. Exploitation was at a large scale long hours of duty, extremely low wages, ill-treatment, and no safety or welfare provisions. The State never interfered in these matters, so the employers took the most advantage of it and exploited the workers vigorously.

The Industrial Revolution indeed made a great shift in society but it created political and economic gaps, and it became the responsibility of the society to fill those gaps. It took the help of social devices to take care of the gaps which resulted in the formation of labour laws. Labour legislation could be called the natural children of the Industrial Revolution.

The labour legislation is the product of the Industrial Revolution. It was made to stabilise the abnormality caused due to some circumstances. Unlike other laws, it was made to rectify specific labour conditions, therefore they are specific and not general in orientation, philosophy and concept.

In India, the Constitution is the basic framework of all the laws which includes labour laws too. The labour laws fall under the concurrent list which means both the Centre as well as the State can make laws regarding the working​​ class but the State has to keep in mind that the laws made by them must not have any conflict of interest with the Central laws. The Apprentice Act of 1850, was enacted before independence which stated that orphans are allowed to find jobs after reaching 18 years of age. The labour laws were enacted at a time when the workers demanded better wages and a proper working environment.​​ 

The new laws that were implemented by the Indian Parliament fixed the working hours to eight hours with a mandatory break after four or five hours of work, restricted the employers from giving night shifts to women workers, made the employers pay extra wages to the workers for overtime, and abolished child labours. The Trade Unions Act of 1929, and the Factories Act of 1948, were enacted to safeguard all the rights of the workers working in an establishment. A decent salary with a proper working environment was allotted to the employees to improve the productivity of the goods. These Acts were enacted to solve the issues between the employers and the employees, and also to protect the interests of both parties.

The Directive Principles of State Policy and Its Guidelines

The Directive Principles of State Policy in India are a set of guidelines laid down in Part IV of the Constitution, which serve as a moral compass for the government in formulating policies and laws. While not enforceable by courts, these principles are considered fundamental in shaping the socio-economic framework of the country.

Regarding labour laws, the Directive Principles provide a framework for the State Governments to follow while framing and enforcing them. Some of the key guidelines include:

1.​​ Ensuring Adequate Living Wage: The State Governments are directed to strive towards ensuring that workers receive a wage that is not only fair but also provides for a decent standard of living.

2.​​ Protection of Workers' Health and Strength: It is the responsibility of the State Governments to ensure that workers' health is protected and that they are not subjected to conditions that are detrimental to their physical or mental well-being.

3.​​ Ensuring Just and Humane Conditions of Work: State Governments must ensure that working conditions are just and humane, and that workers are not subjected to exploitation or abuse by their employers.

4.​​ Provision of Maternity Relief: The Directive Principles advocate for the provision of maternity relief for women workers, including maternity leave and other benefits to support them during pregnancy and childbirth.

5.​​ Protection of Childhood and Youth: State Governments are directed to protect children and young workers from exploitation and ensure that their employment does not interfere with their education or physical and moral development.

6.​​ Equal Pay for Equal Work: The principle of equal pay for equal work for both men and women is emphasized, ensuring that gender discrimination in wages is prohibited.

7.​​ Promotion of Social Justice and Welfare: Labour laws should be formulated and enforced in a manner that promotes social justice and the welfare of all workers, particularly those from disadvantaged or marginalized sections of society.

8.​​ Protection of Workers' Interests in Management: The interests of workers in the management of industries and other establishments should be safeguarded, ensuring their participation in decision-making processes that affect their rights and interests.