Legal Aspects of Employment Laws- Part 2

In continuation to my last article Legal Aspects of Employment Laws- Part-1 - A series of article with an intent to congregate fundamentals of employment laws applicable in India and to provide a broader oversight to HR professionals.

“An individual who breaks a law that conscience tells him is unjust, and who willingly accepts the penalty of imprisonment in order to arouse the conscience of the community over its injustice, is in reality expressing the highest respect for the law.”- Martin Luther King, Jr.

Companies Act, 1956- This is the basic law which governs the creation, continuation, the winding up of companies and also the relationships between the shareholders, the company, the public and the government. Coupled with other statutes dealing with corporate entities, this is an extremely important piece of legislation. When we go for incorporation of a new company it is imperative to register the new venture with the ROC (The Registrar of the companies).

The Contract Labor (Regulation & Abolition) Act, 1970- Once the company is registered with the ROC, We look for janitorial staffs, security guards, and maintenance staff to support our day to day operations. We must have Form-2(Contractor Registration Certificate) & Form-5 (Licensing of contractor). As a principal employer, we are legally bind to ensure vendor follow the requisite law of the land governing employment practices. Periodic Audit would help.

The Equal Remuneration Act, 1976- We should always be cognizant about the parity for the payment of equal remuneration to men and women for same work as per this act. To bring parity, prevailing wages shall not be reduced but the higher rate shall be maintained.

The Minimum Wages Act, 1948 : It says all employers to pay to every employee engaged in the employment at a rate not less than minimum rate of wages as fixed by Notification by not making deduction other than prescribed. Employer needs to fix working hours for normal working which must constitute one or more specified intervals. To provide for a day of rest in every period of seven days with remuneration.

The Payment of Wages Act 1936- To regulate the payment of wages for employed persons, government has defined the timeline through this act. It says the wages of every person employed is to be paid. In case of less than 1000 persons are employed they shall be paid before the 7th day of the following month. In case of more than 1000 workers are employed they shall be paid before the expiry of the 10th day of the following month.

Maternity Benefit Act, 1961 - The core objective of this act is to protect the dignity of motherhood and the dignity of a new person’s birth by providing the full and healthy maintenance of the woman and her child at the important time when she is not working. All women employees either employed directly or through contractor are covered through this. Key Benefits - • Leave with average pay for six weeks before the delivery. • Leave with average pay for six weeks after the delivery. • An additional leave with pay up to one month if the woman shows proof of illness due to the pregnancy, delivery, miscarriage, or premature birth. • In case of miscarriage, six weeks leave with average pay from the date of miscarriage. • No discharge or dismissal while she is on maternity leave. • No change to her conditions of employment while on maternity leave. • Pregnant women discharged or dismissed may still claim maternity benefit from the employer.

In my next post, I shall touch upon exemptions requirement for unhindered operation, Leave, Provident Fund , Bonus Act etc.


  1. Anonymous4:38:00 PM

    Employment Laws are fine. But what about blatant non-compliance by several reputed organizations with the enforcing agencies knowingly turning a blind eye to such violations.

    This is happening in most Garment Export Co.s in delhi & NCR, in the Industrial belts of Rudrapur and Orissa and most of us know about the clear violations by the employers.

    I had raised this with the National HRD Network and had suggested that we create a forum or a Sub Committe to address this very serious issue of employers depriving employess of their rightful dues, be it Minimum wages, Bonus, Gratuity etc. Even provisions of the Factories Act are blatantly violated.

    Some of us have become experts is designing systems to help creat a facade to conceal such violations to make a show of compliance.

    I would repeat my suggestion that lets us HR Professionals create a forum to address this very serious issue and then appeal to the defaulting Corporate and others to pitch in ensure toal compliance of statutory obligations.

    Yes, I would like to be n active member of the forum.

    I wonder if my suggestion will be responded to.
    It will be great to take on this challenge and put our own awareness, experience and knowledge to good use and help the deprived workers' class.

    Vasant Nair
    HR Advisor

  2. Anonymous1:58:00 PM

    Hi ,
    The article is good knowledge on the laws . However we have yet to reach a point where we focus on more complex HR issues prevalent in knowledge workers driven organisation .
    For instance :
    - What is the support to an employee in case of victimisation , discrimination , marginalisation ? These are more covert issues difficult to prove but even if proven they are more ethical than legal issues .
    - What if the salary has been stopped without intimation ?
    - What if no PMS has been done ?
    - What if one has been targeted and HR has to introduce innovative HR practices to make this happen and look professional ?

    I wonder whether HR people really challenge and question the wrog doings of the same or partner the crime and then put the blame on - "management"

  3. Anonymous4:14:00 PM

    Dear Rajgupta jee,
    Gonethrugh your article,really it an excellant presentation which will be liked by all HR-Professional.Pl keep on educate all HR professional.Wish you all the best.

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