Development of Labor Laws in India

Vanshika Arora, is a first-year B.A.LL.B student at the Army Institute of Law, Mohali. This article intends to briefly describe the history, evolution and development of Labour Laws in India.

INTRODUCTION

Labor laws, also called employment laws are a domain of laws that deals with the relationship of the employee and employer, along with the rights of both parties involved. This sect of law rules precedents and administration of a relationship with two parties wherein one is working for the other in exchange of some consideration. It also provides a link between laborers and the government. Essentially, labor laws deal with industrial relations such as trade unions, collective bargaining and unfair labor practices; workplace health and safety standards; and employment standards such as wages, maternity or paternity leaves, working hours, unfair dismissal etc.

Labor laws can be broadly divided into two categories: collective labor law, that deals with the relationship between employee and employer, plus unions; and individual labor law, that deals with the minimum wage, healthy working conditions, and other rights at the workplace.

History

The Indian labor laws owe their origin to the labor movements of the 19th and 20^th century. These laws were largely a result of the industrial revolution that saw an emerging relationship with the employee and the employer, along with tumultuous revolts that had to be addressed by the government. The very first legislation introduced in regards to the labor laws was Factories Act, 1883; this law abolished child labor, limited working hours to eight in a day, initiated overtime working wages and introduced safe working conditions for women.

On an international level, labor rights were first given global recognition through the enactment of ILO (International Labor Organization), established in 1919, by the League of Nations, after the end of World War I. On 29^th October, 1919, ILO adopted first six conventions on the labor laws, which dealt with hours of work, unemployment, maternity leave, night work for women, minimum wage and night work for young people. India has ratified 6 conventions of ILO, this binds India to abide by them at the international and national forums.

Subsequently, The Trade disputes Act, 1929 became the earliest legislation that governed the relationship between employee and employer.

Originally, the Trade Disputes Act and The Factories Act, were a result of British Colonial Interests guided by British Political economy and trade. Each of the two laws had provisions to promote profitable British trade. Hence, post independence legislators deemed fit to accrue Indian laborer and employer’s interests by altering these laws to include fair wage and fair working conditions.

Constitutional Provisions Governing Labor Laws

Labor Laws fall under the concurrent list, meaning both State and Center can make laws on the matters relating to labor. Chapter III, articles 16,19,23 and 24 along with Chapter IV, articles 39,41,42,43,43A and 54 deal with the matters of labor law. Entry 24, 25, 55, 65 and 66 of the concurrent list contain provisions in regards to labour laws.

Evolution of Labor Laws in India

Only until recently, labor law legislations in India were scattered to be 40 at central level and 100 at the state level. Broadly, they could be categorized into:

Acts administering working conditions: Factories Act, 1948; Shops and Commercial Establishment Act, 1961; The Contract Labor (Regulation and Abolition) Act, 1970.

Acts safeguarding social security: Employees’ Provident Fund Act, 1952; Workmen’s Compensation Act, 1923; Employee’s State Insurance Act,1948.

Acts providing for wages and remuneration: Payment of Wages Act,1936; The Minimum Wages Act,1948.

Acts providing security of employment and labour relations: Industrial Disputes Act, 1947; Industrial Employment Standing Order Act, 1946.

Most recently, in 2019, the Central government attempted to amalgamate these laws into a simpler, more comprehensible legislation. This was also suggested by the second National Commission (2002), which found the umpteen laws archaic and complex. In an attempt to codify and consolidate 29 central laws, 4 bills were introduced in the parliament, and only Wages Code Bill was passed in 2019. In September 2020, all erstwhile laws were replaced by the other 3 main legislations introduced, namely:

Industrial Relations Code Bill, 2020

This law combines Industrial Disputes Act,1947; Trade Unions Act,1926; and Industrial Employment (Standing Orders) Act, 1946. This law aims to include provisions for emerging forms of labor, like the gig economy. Earlier, many laws at the centre and state level attempted to define terms such as “employee”, “employer”, “wages” etc, this law attempts to produce a single definition aiming for uniformity. It also attempts to expand the definition of strike to include concentrated leave of more than 50% workers on a given day or days.

Code on Social Security Bill, 2020

This bill amalgamates 9 different laws and primarily recognizes unorganized sector workers. It defines an aggregator, gig worker, unorganized worker etc. It increases Employees’ Provident Fund to every establishment with more than 20 employees. It provides that maternity benefits shall apply to every establishment with 10 or employees. It also provides for the establishment of social security bodies to effectively implement social security regulations.

Occupational Safety health and Working Conditions Code Bill, 2020

This law amalgamates 633 provisions of 13 central legislations, into a single code. This code aims to lay down security and health related measures for those working in hazardous industry, such as mines, factories, construction and dock work, etc. It largely defines, contract labor, hazardous process, wages, certain rights of the employee and duties of the employer. Moreover, it lays down provisions for health, safety and working conditions and recognizes interstate contract laborers and migrant workers under the ambit of employees.

Conclusion

The three codes on one hand are revolutionary in the sense that they have optimized labour laws administratively and have done away with many complexities in the literature and the machinery of the umpteen statutes that existed before. However, on the other hand, these codes are being criticized highly for having set a precondition for workers that wish to strike. (that is a sixty day prior notice). This precondition is seen to be problematic under the constitutional right to strike. Moreover, through these codes, the threshold of standing order has been increased from 100 to 300 employees, giving immense unfair freedom to employers in terms of the hiring and firing process.

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