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copies of the bills: THE INDUSTRIAL DISPUTES (AMENDMENT) BILL, 2002 (PDF Format) THE CONTRACT LABOUR (R&A) (AMENDMENT) BILL, 2002 (PDF Format) THE WORKMENS COMPENSATION (AMENDMENT) BILL, 2002 (PDF Format) THE PAYMENT OF BONUS (AMENDMENT) BILL, 2002 (PDF Format) THE PAYMENT OF WAGES (AMENDMENT) BILL, 2002 (HTML Format) |
30th March 2003 - ERLaws.com Editorial Amendments in The Industrial Disputes Act, Payment of Bonus Act, Contact Labour Act, Workmens's Compensation Act and Payment of Wages Act are all pending before the Rajya Sabha for approval, after having been passed by the Lok Sabha. After various announcements of cabinet approvals of liberalisation of the labour law environment through significant amendments in the Contract Labour Act (easing outsourcing), and the Industrial Disputes Act (easing retrenchment), when the text of these bills became available, it was with great excitement that one waded through the text of the bills. After many hours of splitting hairs with legalese, all I have to say is .. looking forward to employer friendly amendments in labour laws ? Well look real hard. The labour and the trade unions will be very satisfied.
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TABLE OF AMENDMENTS
| Act | Section | Title | Detail | Employer Friendly Rating |
| ID Act | 2(s) | Change in definition of workman | Section 2(s) defines a workman. Earlier the definition of a workman excluded any person employed in a supervisory capacity drawing wages more than Rs 1600 per month (Section 2(s)(iv)). The bill seeks to remove this ceiling on wages in the definition, thus bringing all workmen employed in a supervisory capacity under the purview of the act, regardless of their wages. | Negative Who needs more cases!! |
| ID Act | 2(a) | Change in definition of Appropriate Government | Section 2(a) defined the Central Government as the appropriate government for various industries including Banks, Insurance Companies, Air Transport Companies, Mines, Oilfields and many others. This meant that all disputes would be resolved through Central Government machinery leading to a fair degree of inconvenience to all concerned. Now "appropriate Government" means, 'the Government of the State or Union Territory, as the case may be, in relation to all the industrial disputes concerning any industry or its unit in whose territorial jurisdiction that industry or its unit is situated" i.e. everybody deals with the machinery of the state the unit is situated in. | Marginally Positive For those who were affected, start building relationships with your State Government officials |
| Contract Labour Act |
2(a) | Change in definition of Appropriate Government | Section 2(a) - Has the same effect as under the similar change in the ID Act | Neutral Just a different set of people to deal with |
| Contract Labour Act |
Expl. to S.10 |
Change in explanation of work of perennial nature | Section 10 - regarding the prohibition of contract labour states that 'If a question arises whether any process or operation or other work is of a perennial nature, the decision of the appropriate government thereon shall be final'. It is seeked to modify this to provide for automatic grant of permanent employment to the workers when the government decides that work is of a perennial nature. | Deadly Bring out those strategies, you'll have to revise them risk levels |
| Bonus Act |
2(13) | Removal of ceiling for eligibility for bonus | Section 2(13) - defines employees eligible for a bonus as those drawing a wage below Rs 3500 per month. This wage ceiling is now to be removed thus bringing all employees under the purview of the act. | Negative You probably pay them bonus anyway but more paperwork |
| Bonus Act |
12 | Removal of ceiling on wages for calculating bonus | Section 12 decrees that for employees covered under the act, bonus will be calculated as if wages were Rs 2500. This ceiling of Rs 2500 is now proposed to be removed. | Negative Wage Bills go up .. |
| Workmen's Compensation Act |
2(n) | Inclusion of casual workers under the purview of the Act | Section 2(n) excludes people who are employed in a casual nature and those who are employed 'otherwise than for the purpose of the employers trade or business. This exclusion is sought to be removed. | Negative More employees under the purview of the act .. |
| Workmen's Compensation Act |
4 | Increase in minimum amounts payable for death and permanent total disablement | Section 4 sets the minimum amount payable for death and permanent total disablement as Rs 50,000 and Rs 60,000 respectively. These are sought to be enhanced to Rs 80,000 and Rs 90,000 respectively | Neutral Surely you can't complain |
| Workmen's Compensation Act |
Expl II to Sec 4(1) | Increase in ceiling of monthly wages to calculate compensation | Explanation to Section 4 set a ceiling of Rs 2000 for the purpose of calculating wages. This ceiling is sought to be enhanced to Rs 4000 | Neutral Marginal Impact |
| Workmen's Compensation Act |
4(4) | Increase in funeral expenses | Section 4(4) requires the employer to deposit Rs 1000 with the commissioner as funeral expenses payable to the workman. This amount is sought to be increased to Rs 2,500 | Neutral Marginal Impact |
| Workmen's Compensation Act |
4(A) | Payment of penalty on late payments to the workman | Section 4(A) specifies that the penalty on late payments is to be credited to the State Government. It is sought to credit the penalty amount to the workman | Neutral No difference to employer |
| Payment
of Wages Act |
1(6) | Increase in Ceiling of Wages for applicability of the Act | As per Section 1(6) nothing in this act applies to workers whose wages are more than Rs 1,600 a month. This ceiling is sought to be increased to Rs 6,500 thus bringing more workers under the coverage of the Act. | Negative More employees under the purview of the act .. |
| Payment
of Wages Act |
2(i) - New | Addition of definition of Appropriate Government | A new definition is to be added for"Appropriate Government" - in relation to railways, air transport services, mines and oilfields, the Central Government and, in relation to all other cases, the State Government. Also, the expressions 'Central Government' and 'State Government' will be modified to read 'Appropriate Government' | Neutral Marginal Impact |
| Payment
of Wages Act |
3 | Changes in authorities responsible for payment of wages | Section
3 specifically excluded defining a person apart from the
employer responsible for the payment of wages for contract
employees ( proviso to S.3 -
' in the case of persons employed (otherwise than by a contractor)'. The amendment proposes to extend the responsibility for contractors to 'a person designated by the contractor who is directly under his charge'. Also adds a new sub-section which covers any establishments not explicitly mentioned in S.3, and extends the responsibility to any person designated by the employer as responsible for compliance with the act |
Neutral Marginal Impact but Payroll Managers could now go to jail. |
| Payment
of Wages Act |
7 | Certain deductions to be governed by employment contract rather than State Rules | Section
7 defines permissible deductions. Most of these are governed by
state rules. It is now proposed to govern the following deductions
through the employment contract instead. Deductions for amenities and services supplied by the employer - 7(e) Deductions for recovery of loans made from any fund constituted for the welfare of labour - 7(ff), Deductions for recovery of loans granted for house building, and interest thereon 7(fff) Deductions for subscriptions to, and for repayment of advances from any provident fund - 7(i) Deductions for payments to cooperative societies or to a scheme of insurance maintained by the Indian Post Office - 7(j) Deductions authorised by employee for payment of contribution to any fund constituted by the employer or a trade union for the welfare of the employed persons or the members of their families, or both 7(kk) |
Positive The contract of employment wins a few from the law albeit marginal.. redraft your appointment contracts |
| Payment
of Wages Act |
8(6) | Fines not to be recovered beyond 90 days | Section 8 prescribes that fines cannot be recovered by installments after a period of 60 days. It is proposed to change this to 90 days. | Neutral Huh ? |
| Payment
of Wages Act |
15 | Changes in authorities and procedures to hear claims | Section 15 The proposal Redefines the authorities who are authorised to hear claims, increases the maximum compensation payable to an employee from 25 Rs to Rs 2000, Sets a period of 3 months to dispose of claims, and increases the compensation payable to the employer by an employee who has filed a malicious claim from Rs 50 to Rs 250. | Neutral Marginal Impact |
| Payment
of Wages Act |
20 | Changes in Penalties and Fines | Section 20 Standard Fines earlier were between Rs 200 to Rs 1000. This is proposed to be increased to between Rs 5000 to 10000. Repeat Offences - Rs 15,000 to Rs 30,000. New Fine: Rs 2000 - Failing to nominate or designate a person responsible for payment of wages (S.3) | Neutral If you comply, you wouldn't worry about fines .. |
| Payment
of Wages Act |
24 | Delegation of Powers to State Government | Section 24 is proposed to be deleted and replaced by a new section which allows the appropriate government to delegate its powers to a sub-ordinate officer or authority | Neutral No Impact |
| Payment
of Wages Act |
26 | State Government's power to make rules | Section 26 - Maximum penalty/fine imposable by the state government changed from Rs 200 to between Rs 500-1000, and adds a new sub-section 7 which specifies that all rules made by the state government should be laid before the state legislature. | Neutral Hardly sums that would scare anybody |