Laws for automatons

Trade unions react strongly to the fresh set of amendments the government has introduced in the Factories Act without discussions with them.

Published : Jan 06, 2016 12:30 IST

At the assembly line in the Hero Motocorp factory at Neemrana in Rajasthan.

At the assembly line in the Hero Motocorp factory at Neemrana in Rajasthan.

THE Narendra Modi-led National Democratic Alliance (NDA) has been so keen to attract investment and encourage the private sector in the “Make in India” project that concerns of the labour are perceived as incidental. The Factories (Amendment) Bill, 2014, a piece of legislation the government has been keen to push through in Parliament, is clear evidence of this. The Bill was introduced in the Lok Sabha in August 2014 without as much as a discussion with national trade unions. After trade unions jointly registered their protest in a mass action in early 2015, a set of amendments was inserted in the Bill in October. The government’s move to introduce the fresh set of amendments even as the Bill lay in the Lok Sabha has been surprising given the fact that only recently the Union Labour Minister and the Prime Minister had, while addressing the tripartite Indian Labour Conference, assured all stakeholders, especially the trade unions, that any decision involving labour would be taken only with their concurrence.

When it comes to amending this crucial piece of legislation that guaranteed a minimum level of protection to the industrial working class, there seems to be not much difference between the present government and the previous United Progressive Alliance (UPA) government. While during the UPA regime there was a modicum of discussions with trade unions and other stakeholders, there is not even a pretence of that in the current government’s approach. No wonder the Bharatiya Janata Party’s (BJP) trade union wing, the Bharatiya Mazdoor Sangh (BMS), has come out openly against foreign direct investment proposals in crucial sectors and the new amendments to the Factories Act although it had stayed away from the joint strike by trade unions held in October.

The contentious issues in the amendments introduced in 2014 pertained to three areas: one, the proposal to raise the threshold level of employment in establishments for the application of the Factories Act; two, the increase in the “spread over” of working hours in a day; and three, the hiking of the maximum permissible overtime work from 50 hours in a quarter to 125 hours.

Significantly, the third report of the Parliamentary Standing Committee on Labour (2014-15) on the Factories Amendment Bill, 2014, which was presented to the Lok Sabha in December 2014, was critical of the amendments introduced by the government. More than a hundred views and suggestions were presented to the committee.

Though the Factories Act has been amended seven times, the push to make it more amenable to the requirements of industry began during the UPA’s tenure in 2010, when an expert committee was constituted under a member of the Planning Commission to make specific amendments to the Act. The move could not take off during its tenure.

One of the sustained arguments made by the Union Ministry of Labour in favour of the amendments was that it was only articulating the sentiments of the State governments. The committee said that if the State governments were keen to make changes, they could do so without the Centre’s intervention as labour was in the Concurrent List. On the issue of increasing the “spread over”, the committee was of the view that the proposal may lead to the harassment of workers who would be compelled to stay for a longer period without compensation.

On increasing overtime hours too, the committee felt that it would have an adverse impact on employment generation. However, the Ministry justified the proposal on the grounds that it did not violate the Article concerned under Convention I of the International Labour Organisation (ILO) and that the need for increasing the time limit for overtime work was based on a demand from industries and seasonal factories where work on an urgent basis needed to be carried out.

On the issue of removing the restrictions on employment of women in night shifts, the committee received representations that it should be made mandatory not to allow working hours for women in any factory before 7 a.m. and after 6 p.m.; to this the Ministry said that there were adequate safeguards. Even as these contentious issues remained as such, the Ministry went ahead and introduced a slew of new features which unions across the board have criticised. The new amendments, which were revealed to trade unions at a bipartite meeting on October 6, have turned out to be more severe. According to Tapan Sen, Rajya Sabha member of the Communist Party of India (Marxist), who is also general secretary of the Centre of Indian Trade Unions (CITU), and A.K. Padmanabhan, CITU president, the threshold limit of employment for an establishment to be covered under the Act has been enhanced to 40 irrespective of the usage of power. By this, more than 75 per cent of the workforce, they said, would be out of the coverage of the Factories Act.

The Small Factories and Other Establishments (Regulation of Employment and Conditions of Work) Bill provided for the exemption of 14 labour laws in establishments employing up to 40 workers.

Definitions The definition of manufacturing is also problematic as it excludes mechanical bottling and packaging processes from manufacturing process. This will push workers engaged in these activities beyond the ambit of the Factories Act.

Another concern that all trade unions from the Left to the Right share is the new provision that enables employers to separate any department or unit of a factory and declare it as a different factory by simply getting permission from the State government. This, unions rightly fear, will let employers keep the workforce under 40, thereby exempting the unit from protective labour laws.

Further, a provision in the new set of amendments says that a court will take cognisance of a complaint only if the matter is approved by the State government concerned. This would hamstring labour inspectors from doing their job. As it is, unions argue, the web portal system of inspections—a platform for employers to file their annual returns and compliance and inspection reports—hardly encapsulates per cent of the data in the Central sector.

Additionally, the amendments say “employers would be encouraged to provide paid maternity leave”. Unions argue that it is a dilution of the statutory right of women workers.

Another aspect pertaining to women workers on the night shift is the dilution of the provision of transportation from the factory premises to the doorstep of their residence, a proviso which was there in the earlier draft.

On safety and occupational health issues at the workplace, the Bill includes a proposal to set up an institution named Occupational Safety and Health Board of India (OSHBI). However, unions are surprised that the board does not envisage a tripartite mechanism. Safety, they argued, could only be ensured with a proper inspection mechanism.

‘Objectionable provisions’ The BMS has reacted strongly to the proposed amendments. “They contain highly objectionable provisions proposed to help the defaulting employers which dilute safety provisions, take away rights and welfare of workers, create harassment of women and young workers, etc. Further, safety provisions are highly diluted and India will be under the risk of increased factory calamities like Bhopal tragedy. When there are thorough changes proposed after 68 years in the Factories Act, such policy level changes and deviations from existing practices have to be repeatedly discussed in depth with various stakeholders. Anti-worker labour law amendments are brought about in the guise of strengthening the manufacturing sector. In these amendments the attempt is to blame workers and labour laws for the fall of manufacturing sector and competitiveness. This is totally wrong and such a way of thinking has to be stopped forthwith. The fall of manufacturing sector in India and its competitiveness is due to various other reasons upon which no serious discussions are taking place in the country. India has been reduced to a mere market for the imported foreign goods. Our industrial stalwarts are becoming mere agents of foreign multinationals, instead of strengthening the manufacturing sector,” underscored a statement issued by BMS office-bearers Saji Narayanan, Pawan Kumar and Rajagopal.

“On November 3, the government held a meeting of all stakeholders. We expressed our views. There should be trade union representatives on the OSHBI. We don’t oppose the Make in India concept. Already companies are making in India, but there seems to be no obligation on their part to comply with labour laws. There should be tough conditions on companies desiring to make in India. In many automobile companies in Tamil Nadu, there is not a single permanent worker,” Virjesh Upadhyay, BMS general secretary, told Frontline .

The BMS observed that the World Bank recently had dropped “labour” as an impediment from “ease of doing business”. But the same “ease of doing business” concept imported to India was being propagated with “labour” mentioned as an impediment by the present government, the BMS statement said. “There is no ease of living and we speak of ease of doing business. We are still in the stage of fighting for minimum wages and implementation of labour laws. If policies are not human-centric, there can never be ease in doing business,” said Upadhyay.

At the fifth Labour and Employment Minister’s conference in Bulgaria on December 3-4, the Labour Ministry’s representative pointed out that the private sector was the main driver of the Make in India initiative in attracting investment and taking manufacturing to “distant geographies” of India and that the Indian government was working as a facilitator to create an environment conducive to business so that large employment opportunities could be created in every corner. The conference was informed that a series of labour reforms had been initiated to promote ease of compliance without compromising the interest and welfare of the working class. The ease of compliance probably referred to the Shram Suvidha Portal, which allowed for random inspections through a computerised system, uploading of inspection reports by labour inspectors within 72 hours, and a self-certification system of filing returns by establishments.

It was also pointed out that labour law reform initiatives to rationalise and simplify 44 Central laws into four labour codes were high on the agenda of the government. On December 6, in a function to release a booklet by the Labour Ministry to commemorate the 125th birth anniversary of Dr B.R. Ambedkar, Union Home Minister Rajnath Singh reiterated the government’s commitment to “Shramev Jayate”. Mallikarjun Kharge, the Leader of the Opposition in the Lok Sabha, who was present on the occasion, pointed out that the Labour Ministry was not given due weightage in the Cabinet even though the matter of labour was at the core of citizens’ welfare.

In an effort to show that it was not entirely anti-labour, the government introduced in the winter session of Parliament the amendments to The Payment of Bonus (Amendment) Bill, 2015, where the ceiling for calculation of bonus was enhanced from Rs.3,500 to Rs.7,000 and the eligibility limit for payment of bonus was raised from Rs.10,000 to Rs.21,000 a month. The Act, applicable with retrospective effect from April 1, 2014, extends to all factories and other establishments employing 20 or more persons. Interestingly, the amendment Bill was passed by the Rajya Sabha on December 23 where members did not even get a copy of the text of the amendment Bill that had been passed by the Lok Sabha. Trade unions on their part was guarded in welcoming the amendment as the government had still not acceded to their demand that there should be no ceiling on bonus.

“It is an improvement, but not enough. There was no consensus at the Indian Labour Conference. The employers are naturally happy,” said Padmanabhan of the CITU. In the Lok Sabha, while speaking on the amendment, Sankar Prasad Datta, Lok Sabha member of the CPI(M), reminded the government of the Bonus Commission of 1961 which said that 60 per cent of the available surplus ought to be distributed as bonus. He asked why there should be a ceiling on bonus when there was no ceiling on profit accumulation.

Whatever the Labour Ministry has done so far has not won it the appreciation of at least the industrial working class. Recent electoral outcomes only reflect a growing disenchantment with price rise and inflation. And there seems to be a fundamental incongruity between the ease of doing business, the ease of compliance, and the ease of living.

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