Navigating labour law compliance
a comprehensive analysis of regulatory frameworks in India

Labour law compliance in India

Labour law compliance in India involves ensuring adherence

to the regulations set by governing bodies at the central and state levels. These laws are designed to balance the interests of employees, employers, and unions. Compliance ensures that employee rights are protected, and a conducive work environment is maintained.

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Key concepts under labour law

Several critical concepts fall under labour law compliance. Below are some of the most important, along with key questions to consider for each:

Salary

• What is the remuneration offered to an employee?
• What additional benefits are included?
• What are the total deductions?
These questions help determine an ideal salary structure, which is a crucial step in labour law compliance.

Work schedules

• What are the shift timings?
• Is there a night shift, and is it convenient for employees?
• Are the working hours favourable for employees?

Occupational safety

• How safe is the work environment? • Are there any hazards employees should be aware of?
• How can the work environment be made safer?
Ensuring a safe work environment is vital for labour law compliance.

Due notice for resignation

• What is the minimum notice period an employee must serve before leaving?
• Why was the employee terminated, if applicable?
• What policies govern the notice period and exit interview process?
Addressing these questions ensures compliance even during an employee's exit from the company.

Unemployment compensation

• What are the requirements for unemployment compensation?
• What compensation is provided to unemployed individuals to aid their job search?
• How long will the compensation be provided?
Understanding these aspects ensures that the company complies with unemployment compensation regulations.

Harassment Protection

• Are there proper laws in place to protect against harassment?
• How do company policies align with central and state laws?
• What compensation is provided to victims of harassment?
• Ensuring robust harassment protection measures is crucial for compliance.

Overtime compensation

• Is suitable compensation provided for overtime work?
• How is the amount of work calculated?
• Is the compensation pro rata based on the employee's salary?

Maternity Benefits

• Are expectant mothers provided with due benefits, such as leave and minimum salary?
• What duration is specified for maternity leave?
• How can paternity and maternity benefits be improved?
• Providing adequate maternity benefits is a key component of compliance

Classification of labour law compliance

Indian labour law compliance can be broadly classified based on the aspects they regulate concerning workers and the workplace. These include rules governing working hours, conditions of service, health, safety, equality, minimum wages, social security benefits, termination, and prevention of sexual harassment in the workplace. The numerous statutes regulating labour compliance have historically been complex, making it challenging for corporations and businesses to keep track. The Indian labour code can be broadly classified into the following categories based on the areas they regulate:

Categorisation of labour compliance laws in India

There are two categories of labour compliance and laws in India. The collective labour law relates to the tripartite relationship between employer, employee and union. On the other hand, labour law concerns employees’ rights at work and throughout the work contract. Every organisation must comply with laws in both these categories to function without hindrance by the government after implementing the new labour law regime. Assistance and guidance from industry experts can make your business compliant with the existing laws and prepare it for all the changes that have been proposed.

Following is the list of categorisations of labour compliance laws in India –

Laws related to industrial relations, like the trade unions act of 1926, industrial disputes act of 1947 etc.

Laws that relate to wages, such as the payment of wages act 1936, minimum wages act, of 1948 etc.

Laws that relate to working hours, conditions of service and employment, such as the factories act, of 1948, plantation labour act, of 1951, mines act, 1952 etc.

Laws related to disadvantaged and deprived sections of society, such as bonded labour system (abolition) act, 1976, child labour (prohibition & regulation) act, 1986 etc.

Laws relating to social security include workmen’s compensation act, 1923 employees’ state insurance act, 1948 etc.

The government of India has consolidated twenty-nine labour legislations of the 44 labour-related laws into four labour codes. This is done as there was a diversity of labour laws and related labour compliance rules in India. The categories of acts mentioned above have been organised to fit into four categories.

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List of labour law compliances in India and provisions

The employees compensation act – 1923 – to compensate employees who got injured or died at the workplace.
The trade unions act – 1926 – to define laws related to registered trade unions.
The payment of wages act – 1936 – applies to industrial workers and the wages that must be due to them.
The industrial employment (standing orders) act – 1946 – relates to classification of workmen, leave policies and authority etc.
The industrial disputes act – 1947 – for the investigation and settlement of industrial disputes.
The employees state insurance corporation act (ESIC) – 1948 – employment insurance against injury or sickness.
The minimum wages act – 1948 – to prevent employee exploitation and to maintain minimum standard of living for each employee.
The factories act – 1948 – sets safety standards for workers employed in factories.
The employees provident funds and miscellaneous provision act (EPF) – 1952 – special provisions for all employees.
The employment exchange (compulsory notification of vacancies) act – 1959 – for the compulsory notification of vacancies to employment exchanges.
Income tax act – 1961 – specifies that tax deductions to be applied for all individuals with an income.
The maternity benefit act – 1961 – to regulate employment of women who are to conceive and to provide benefits.
The apprentices act- 1961 – regulates the employment of apprentices in certain industries or trades.
The industrial establishment (N&FH) act – 1963 – to grant national and festival holidays to employees in industrial establishments.
The payment of bonus act – 1965 – for the payment of bonus due to an employee as a percentage of the salary.
The labour welfare fund act (LWF) – issued in different states or by different industries in different years to protect labour rights.
The contract labour (regulation & abolition) act (CLRA) – 1970 – to provide habitable housing and other facilities for labour and to prevent exploitation.
The payment of gratuity act – 1972 – relates to the payment of gratuity after a period and the maximum amount fixed.
The equal remuneration act – 1976 – to provide for equal remuneration to men and women, and to prevent discrimination between them.
The interstate migrant workmen (regulation of employment and conditions of services) act – 1979 – to protect the rights of inter-state migrant workmen and to provide suitable conditions for work.
The child labour (prohibition & regulation act) – 1986 – to prevent child labour in any industry.
Sexual harassment of women at workplace (prevention, prohibition & redressal) act – 2013 – to prevent sexual harassment at the workplace for women.
Shops and commercial establishments act – issued separately by each state governing the licensing and operations of shops and other establishments.

Are you looking for a labour law compliance service in India?

If there is something a business can’t do without, then that’s its people. To ensure that the people are all happy and work goes on without any interruptions, the rights of individuals must be safeguarded at the workplace. This is governed by labour laws in the country of employment and how well they are implemented in your business. labour law compliance needn’t be difficult to manage.

Are you looking for a labour law compliance? Talk to us, TalentPro India is a reliable HR partner with over 25 years of experience in staffing and recruitment, payroll and compliance and bid your labour law compliance worries goodbye.