10/16/2020 MODULE 5

LABOUR POLICY OF THE CENTRAL GOVERNMENT

Labour policy in lndia has been evolving in response to the specific needs of the situation in relation to industry
and the working class and has to suit the requirements of a planned economy

RECENT DEVELOPMENTS

1. The structure of industrial relations has been designed for the purpose of securing peace in industry and a
fair deal for the wolkers. When the efforts of the parties fail to secure an amicable settlement of industrial
disputes, the Government has assumed powers of intervention. Provision has been made for conciliation of
disputes and for enabling the State to refer unresolved differences to tribunals set up for the purpose.
Stoppages of work after such a reference and any contravention of awards and agreements have been made
illegal. This system has helped to check the growth of industrial unrest and has brought for the working
class a measure of advance and a sense of security which could not otherwise have been achieved.
2. A Code of Discipline in Industry, which applies both to the public and to the private sector, has been
accepted voluntarily by all the Central organisations of employers and workers and has been in operation
since the middle of 1958. The Code lays down specific obligations for the management and the workers
with the object of promoting constructive cooperation between their representatives at all levels, avoiding
stoppages as well as litigation, etc
3. The Code provides that a regular grievance procedure be laid down in all undertakings and complla4its
should receive prompt attention. The legal means of redress and the normal channels should be fully availed
of and there should be no direct, arbitrary or unilateral action on either side. Under the Code, management
and workers have agreed to avoid litigation, lock-outs, sit-down and stay-in strikes. There will be no
recourse to intimidation, victimisation or 'go-slow'.
4. It is obvious that a new concept with such far-reaching aims, in a difficult field, requires a considerable
period of earnest endeavour before it gets firmly established in practice. The results so far achieved are,
however, encouraging both in terms of the reduction of man-days lost owing to stoppages and in bringing
about a general improvement in the climate of industrial relations.
5. The deplorable consequences of inter-union rivalry both for industry and for the workers are well-known.
They have been mitigated to some extent by the Code of Conduct which was drawn up and accepted by the
representatives of workers' organisations three years ago. The-Code provides that every employee shall have
the freedom and right to join a union of his choice. Ignorance and backwardness of workers shall not be
exploited by any organisation.
6. The failure to implement awards and agreements has been a comi-pon complaint on,' both sides and if this
were to continue, the Codes would be bereft of all meaning and purpose. A machinery for implementation
and evaluation has, therefore, been set up at the Centre and in the States to ensure observance by the parties
01' the obligations arising from the Codes and from laws and agreements.

7. To give the workers a sense of belonging and to stimulate their interest in higher productivity, a form of
workers' participation in management was evolved during the Second Plan. A small beginning was made in
this direction on an experimental bas.s and Joint Management Councils have been set up so far in 23 units.
APPROACH AND OUTLOOK

8. The Third Five Year Plan has to make its own contribution towards the evolution of labour policy and the
realisation of its basic aims. Economic progress has to be rapid enough to attain a level of full employment,
and secure a rising standard of living for the people. The fruits of progress should be shared in an equitable
manner and the economic and social organisation which is being created must be in keeping with the concept
of a socialist society.

INDUSTRIAL RELATION

9. The development of industrial relations in the Third Five Year Plan rests on tlie foundations created by the
working of the Code of Discipline which has stood the strain of the test during the last three years. A full
awareness of the obligations under the Code of Discipline has to extend to ail the constituents of the Central
organisations of employers and workers.

10. Steps will be taken to remove certain hindrances in the way of a fuller recourse to voluntary arbitration.
The same protection should be extended to proceedings in this case, as is now applicable ta compulsory
adjudication. Government should take the initiative in drawing up panels of arbitrators on a regional and
industry-wise basis. Employers should show much greater readiness to submit disputes to arbitration than
they have done hitherto.

11. The law provides for the establishment of Works Committees at the plant level in order to develop
harmonious relations between employers and workers. The decision to demarcate the functions of Works
Committees, as distinct from those of trade unions, will remove an obstacle in the way of the successful
functioning of the Committees. It is, thus, essential that Works Committees are strengthened and made an
active agency for the democratic administration of labour matters,

12. Joint Management Councils.—A major programme for the period of the Third Five Year Plan will be the
progressive extension of the scheme of Joint Management Councils to new industries and units so that, in
the course of a few years, it may become p. normal feature of the industrial system. It can serve to bridge
the gulf between labour and management; creat" better mutual understanding and facilitate the adoption,
on both sides, of an ob'"ective apy-oaf-h towards the problems of industry and the workers.

14. Joint Management Council should be setup in all establishmemts in the public as well as the private sector
in which conditions favourable to the success of the scheme exist. A primary test of eligibility is the
presence of goodwill on both the sides. Wherever a representative union exists, a Council should come into
being as a matter of course. An intensive programme of workers' education will be undertaken in all the
establishments where such Councils are set up.

15. Workers' education.—The programme of workers' education which Government has undertaken through a
semi-autonomous Board is being run with the cooperation of all the employers' and workers' organisations.
A large-scale expansion of this scheme is visualised for the period of the Third Plan. Tt is intended to
diversify the prc|gramme and secure fuller association of workers' representatives and their organisations.
The complementary question of management training in labour matters is also receiving consideration.
16. The spread of literacy among the workers is an indispensable precondition for the success of the various
programmes that are being undertaken. The benefit of literacy should be made available to as large a
number of workers as possible in the next few years, particularly to those below the age of forty.

17. Trade unions.—there is need for a considerable re-adaptation in the outlook functions and practices of trade
unions to suit the conditions which have arisen and are emerging. They have to be accepted as an essential
part of the apparatus of industrial and economic administration of the country and should be prepared for
the discharge of the responsibilities which attach to this position.

18. The basis for recognition of unions, adopted as a part of the Code of Discipline. A union can claim
recognition, if it has a continuing membership of at least 15 per cent of the workers in the establishment
over a period of six months and will be entitled to be recognised as a representative union for an industry
or a local area. 'f it has membership of at least 25 per cent of workers.

19. The personnel of the industrial relations machinery call for greater attention in respect of selection as well
as training. It is necessary to ensure that the quality aad equipment c'f conciliators and tribunals are
adequate for the complex tasks which now confront them . It is proposed to institute a suitable training
programme for this purpose.

WAGES AND SOCIAL SECURITY

20. The Government has assumed responsibility for securing a minimum wage for certain sections of workers,
in industry and agriculture, who are economically weak and stand in need of protection. Towards this end
the Minimum Wages Act provides for the fixation and revision of wage rates in these occupations

21. Some broad principles of wage determination have been laid down in the Report of the Fair Wages
Committee. On the basis of agreement between the parties, the Indian Labour Conference had indicated
the content of the need-based minimum wage for guidance in the settlement of wage disputes. This has
been reviewed and it has been agreed that the nutritional requirements of a working class family may be
re-examined in the light of the most authoritative scientific data on the subject. Apart from the minimum
wage, care should be taken in fixing fair wages for different classes of workers that adequate incentives are
provided for the acquisition and development of skills and for improvements in cut-out and quality.

22. Owing to the uncertainty attaching to it. the question of bonus has become a source of friction and dispute.
It has been decided to appoint a Commission which will include representatives of both parties to study the
problems connected with bonus claims and to evolve guiding principles and norms for the payment of
bonus.

23. Social Security.—The Employees' State Insurance Scheme has now been implemented in more than a
hundred centres revering about 17 lakh industrial workers. During the Third Plan period, the scheme will
be extended to all centres where there is concentration of five hundred or more industrial workers, bringing-
the total coverage to about 30 lakh workers.

24. The Employees Provident Fund Scheme which now covers 58 industries/establishments will be further
extended. The employment limit for coverage under the scheme has already been lowered from 50 to 20.
25. A Study Group on Social Security had recommended the integration of existing social security schemes and
the conversion of the various Provident Fund schemes into a statutory scheme for old age, invalidity and
survivorship pension-cum-gratuity26. The social security approach has so far extended mainly to wage
earners in organised industry. With a view to enabling these organisations to develop their activities with
the help of local communities, and giving them a little support, it might be useful to constitute a small relief
and assistance fund

WORKING CONDITIONS, SAFETY AND WELFARE

27. Under various laws a comprehensive code has been developed to ensure satisfactory v/working conditions,
safety of person and the provision of a variety of facilities to promote the welfare of the workers. Steps,
however, have to be taken to make the implementation of the statutory provisions more effective. The
improvement of working conditions can result in greater productive efficiency on the part of the workers.
Every effort should be made to keep abreast of the modern developments in these and various other aspects
relating to the human factor in industry. Towards this end, the activities of the Central Labour Institutes
and the three Regional Labour Institutes should be developed to provide a comprehensive service to
industry through training, education and research. The problem of safety should receive greater attention.
They are meeting very real needs. Similar funds are proposed to be created for workers in the manganese
and iron ore mines.

28. Workers' Cooperatives—some progress has been made in the formation of miners' cooperative societies
through the help of the Coal Mines Welfare Fund Organisation. A few workers' cooperative housing
societies also exist in some industrial centres.. Campaigns should be undertaken for setting up cooperative
credit societies and cooperative consumers’ stores. It is hoped that trade unions and voluntary organisations
will evince greater interest and initiative in running such cooperatives.

29. Industrial Housing.—although the Subsidised Industrial Housing Scheme has been in operation for some
years, the situation in respect of the housing of industrial workers has not improved and, in several centres,
it has even deteriorated. The present approach to the problem has been found to be wholly inadequate and
new ways will have to be devised immediately so that the workers may be assured of minimum standards
in respect of living conditions within a reasonable period in the interest of their health and efficiency.

30. Other Problems.—With the help of studies which are now in progress regarding contract labour, it will be
possible to select occupations in which contract labour will not be permitted and, where abolition is not
feasible, to decide on the steps which can be taken to safeguard fully the interests of contract workers

LABOUR POLICY OF STATE GOVERNMENT

1. LABOUR SECTOR TODAY

Though the new industrial policy was aimed at speedy industrial growth, Kerala has not been able to
share in the spurt of industrial activity. The tardy growth in industrialisation has accentuated the problem of
unemployment and the numbers have increased to 43 lakhs.
 The state has a work force of around 83 lakhs of which 19 lakhs are women workers. The vast majority
work in the unorganised, or informal sector; sometimes in conditions of partial employment, often without
adequate access to decent wages or Social Security protection. The attention of Government have been largely
focused on protecting the working conditions and the rights of the relatively privileged minority of workers in
the organised sector.

Unemployment is one of the basic problems confronting the State, and Government have to spur the
creation of new employment opportunities. There are presently around 43 lakhs of young people registered on
the unemployment rolls of the State. Productive employment is being created in the State’s economy at very
low rates. Despite the relatively high skill and adaptability levels of the State’s workforce, labour market has
not been perceived as a positive factor by prospective investors in Kerala.

Labour Sector problems in Kerala are:-

(i) The high rates of unemployment and underemployment.

(ii) The low rates of productive employment creation.

(iii) The unprotected conditions in the unorganized sector.

(iv) The perception of adversarial labour relations.

(v) The inadequate levels of skill creation and training.

(vi) The inefficiently targeted Social Security regime.

The policy objectives of Government arise from the following strategic goals.

(a) fostering an enabling environment for rapid employment generation through enhanced private and public
investment, in order to achieve the goal of creating 15 lakhs of new jobs in the coming five years.

(b) Retraining and rehabilitation of retrenched labour in closed and sick units.

(c) improving working conditions, providing decent wages and basic lifeline Social Security for workers,
especially in the unorganized sector.

(d) minimizing adversarial Labour relations and providing Labour market security, employment security, work
security, and income security for the working population.

2. SOCIAL SECURITY
Kerala has made considerable progress in extending Social Security coverage through the mechanism of
tripartite welfare fund boards. However, many of these schemes lack clear perspective, and need to be
restructured. Their delivery mechanisms are often inefficient and expensive.

A “Frame Legislation” will be enacted to bring in a degree of perspective and order for all Social Security
initiatives, aimed at consolidating the current set of enactment’s, executive orders, provide guidelines for
working out future schemes and obviate the need for individual legislation’s, apart from providing a standards
set of basic operating polices and procedures.

Extending the coverage of the social security net to cover vulnerable workers in the unorganised sector is one
of the major priorities of the Government. New welfare schemes will be introduced for domestic workers, self-
employed workers in the service sector and other unprotected categories. These new schemes will be introduced
by utilizing existing administrative structures. The delivery system will be computerized to facilitate efficient
disbursement; and Social Security cards will be introduced to facilitate universal access and to prevent leakage
and malpractice.

3. EMPLOYEE -EMPLOYER RELATIONSHIPS

It is a fact universally acknowledged that one of the impediments to the growth of investment in Kerala has
been the poor image still subsisting from the years of Kerala`s labour militancy. The State`s youth have paid a
heavy price on account of inadequate employment creation arising from the very low levels of investment in
Kerala. Given the relatively high knowledge levels, skills and adaptability of the worker in Kerala, labour should
be projected as a positive factor while considering Kerala as an investment destination.

(i) Hence Government would endeavour to promote ideal employee-employer relationships and to curb
undesirable labour practices and adversarial labour relations through suitable legislation, through
conscientisation, awareness raising and appropriate administrative interventions.

(Ii) With in the purview of the existing laws, entrepreneur will have rights for engaging labour and shall not be
inhibited by any claims from ‘sons of the soil’, displaced persons from acquired land, construction, contract
labour and dependents of employees.

(Iii) All restrictive labour practices including intimidation, “gherao”, harassment of managers and their families,
and extortion of any kind will be treated as criminal offences and dealt with accordingly.

(Iv) Management will have the prerogative to deploy workers in any section of the unit as part of a multi craft
approach.

(v) Government will endeavour to prevent stoppages of work in projects on account of industrial disputes;
especially during the first five years of the project. The Government will also severely discourage deleterious
practices such as ‘go-slow’.

Government will also encourage long term settlements in industries focussing on productivity and sound
managerial practices.

(viii) To prevent the occurrence of disruptive wildcat strikes and lockouts, Government will declare certain vital
industries and establishments as “public utilities” under the Industrial Disputes Act.

(ix) Special conciliation mechanisms will be set up by Government if, required, exclusively for entrepreneurs
and projects with investment of Rs 150 crores or more in order to ensure that labour disputes are handled on
site in a pro-active manner.
(x) The viability of a project depends on the completion of construction and commissioning within the time and
cost estimate. Work stoppages whether due to labour dispute or non-fulfillment of obligations by builders will
not be permitted.

(xi) Industrial Relations Committees have the pivotal role to create an atmosphere of complete understanding
between labour and management. Tripartite industrial relations committees will be set up for key sectors and
industries. The Government will endeavor to accord statutory legitimacy and protection to these committees.

4. LABOUR LAW REFORMS

The Government of India is amending seminal labour legislation like The Industrial Disputes Act, The Trade
Unions Act, The Contract Labour (Regulation and Abolition) Act and others. An expert committee will be
constituted to study and make recommendations for simplifying and amending labour laws and rules.

(Ii) Government will attempt to reduce the needless proliferation of Trade unions in establishments, without
detriment to the rights and interests of the work force. Legislation will be enacted for conduct of referenda and
laying down norms for the recognition of Trade Unions in industries and establishments.

(Iii) There is a need to expedite the industrial dispute resolution mechanism of the labour judiciary, including
the Labour courts, Industrial Tribunals, Workmen’s Compensation Commissioners etc. Government will make
requisite amendments to the rule and procedures governing the functioning of these bodies to speed up and
streamline this process. The provisions for publication of the awards of Labour Courts and Tribunals in the
Government Gazette will be amended to expedite enforcement.

(Iv) The Government will also enact requisite State amendments to the Industrial Disputes Act to enable
workmen or management to approach Labour Courts/Industrial Tribunals directly, if the conciliation process
proves to be ineffective.

(v) The Kerala Headload Workers Act 1978 is an enactment providing social security net to a category of
workers. However certain unforeseen practices relating to loading and unloading have since become an irritant
phenomena perceived as a stumbling block for industrial growth in the State. A separate legislation to do away
with these practices without affecting the rights and interests of the labour will be enacted.

5. WORKPLACE SECURITY AND INCOME SECURITY

(i) The rapidly changing economic environment accentuates the need to fortify the enforcement machinery of
the Labour Department to ensure that worker’s rights including income security & work security are adequately
protected. The Government will endeavour to ensure that the working conditions and the rights of workers are
protected by enforcing welfare legislation.

(Ii) A special monitoring system will be instituted for ensuring work place security and dignified working
conditions for women workers.

(Iii) Enforcement committees will be constituted at district levels on a sectoral basis for monitoring the
enforcement of statutory rules, welfare measures and safety conditions of workers.
(Iv) For the effective implementation of the Minimum Wages Act, Government will expand the category of
employment’s under the schedule to the Act. Wages shall be revised for each category of employments without
delay and the payment of minimum wages effectively supervised.

(v) The Child Labour (Prohibition & Regulation) Act will be aggressively enforced and Government will
endeavour to make Kerala the first State in the country to be free of Child Labour.

(Vi) Outbound migrant workers, especially women from Kerala require special attention, especially in sectors
like fish processing. Government will strengthen the monitoring system for migrant workers to ensure proper
implementation of the existing laws and to minimise the chances of their exploitation by intermediaries or
principal employers.

(vii) The quality of medical care made available under the Employees State Insurance scheme has to be
improved. Government will endeavour to provide better access to modern medical facilities to insured
employees under the Employees State Insurance Scheme. The ESI coverage will be widened in order to increase
its area of operation.

(Viii) The enforcement of laws & measures like the Factories Act and Rules for assuring workplace security
and for the abatement of occupational hazards and diseases will be made more effective. Enforcement of Acts
relating to industrial safety and prevention of pollution would be strengthened. Special attention will be focussed
to identify hazardous industries and sectors including those in the unorganized sector.

(Ix) The labour enforcement machinery is grossly inadequate to cope with the multitude of labour laws and the
various establishments that require surveillance. The enforcement strategy will be to reduce the burden on the
existing machinery and to encourage employers and other stakeholders to proactively participate in the
implementation of this strategy on a voluntary compliance basis.

6. PLANTATION SECTOR

Problems faced by plantation sector are mainly due to unremunerative prices for products and lack of
productivity. Estates remain closed and those functioning are not profitable. Increased productivity coupled
with scientific management, technological innovations can only salvage the plantations from ruin. Government
will encourage and promote Non Resident investment in this sector

7. DISPLACED WORKERS

Government will prepare special rehabilitation packages for workers who are displaced by the closure of
industries and sick sectors.

Government is particularly concerned about the conditions and prospects of workers in sectors that have been
severely affected, including the plantation sector, the Beedi sector, the Cashew, Coir, Handloom and the
Agricultural sector.

8. EMPLOYMENT REGISTRATION AND INDUSTRIAL TRAINING

(i) The functioning of Employment Exchanges needs to be completely overhauled. These exchanges will be
computerised over the next 5 years and the database updated. It is expected that private sector employers will
also source their requirements from the employment exchanges when this computerisation process is completed.
The Government will also play a more proactive role in enabling access to employment opportunities overseas.

(Ii) The quality of industrial training provided through the network of Industrial Training Institutes / Industrial
Training Centres is out of phase with current employer requirements, and needs to be revamped. The curriculum
and the course content of these Industrial Training Institutes/ Industrial Training Centres will be completely
restructured in line with prospective employer requirements.

9. INSTITUTIONAL AND ADMINISTRATIVE ARRANGEMENTS

(I) The Labour Department will be modernised using the tools of Information Technology to ensure meaningful
labour law enforcement, efficient delivery of social security, and harmonious industrial relations. The
functioning of the department will be made transparent.

(ii) In the background of a fluid and uncertain scenario emerging in the industrial scene, labour has to be
prepared to face the challenges ahead. The worker has to be educated. Awareness of the problems in general
and problems of the particular industry is inevitable for effective and collective bargaining. The workers as well
as the leaders of the trade unions has to cope with the changing demand.. KILE has a very pivotal role to play
in this regard. The scope and functioning of this institute will be enhanced in tune with the National Institute of
Labour.

(Iii) Development Overseas and Employment Promotion Consultants Ltd.

The prime asset of our state is undoubtedly the army of unemployed youth estimated to be around 60 lakhs.
This human resource available with us has to be channeled to productive sector.

(Iv) A policy progress monitoring team will be constituted with Secretary (Labour) as Convenor to review the
implementation of the policy and consider necessary and appropriate interventions in accordance with the
altering needs and demands of labour in view of the fast moving changes in the industrial scene. Review of
progress of implementation of the policy will be prepared by the team for the consideration of the Minister (
Labour and Rehabilitation) and the Council of Ministers.

SO IN SHORT THE LABOUR POLICY HIGHLIGHTS ARE:

This policy is the statement of the concerns of this government for the welfare and protection of labour and to
endeavour to empower them and improve their quality of life. Increased production, productivity coupled with
a harmonious and peaceful labour relations and a new work culture only will create a conducive climate for
rapid industrial investment and growth. This will ensure the successful solutions to the twin problems of
retrenchment of labour and creation of new jobs for the unemployed. Government is also committed to
providing labour market security, income security and decent working conditions for the working population.
This labour policy aims to carry forward these objectives. These aims can be attained only if there is tripartite
and mutually beneficial partnership between employers, workers and the Government.

· Creative measures to attract public and private investment.

· 15 lakh new jobs in the coming five years.
· A unified and consolidated legislation for social security schemes.
· New Social security schemes for workers in the unorganised sector.
· Social security cards for workers.
· Unified and beneficial management of funds of Welfare Boards.
· Reprioritisation of allocation of funds to benefit vulnerable workers.
· Model employee-employer relationships.
· Long term settlements based on productivity.
· Vital industries and establishments declared as `public utilities`.
· Special conciliation mechanism for projects with investments of Rs.150 crores or more.
· Industrial Relations committees in more sectors.
· Labour Law reforms in tune with the times. Empowered body of experts to suggest required changes.
· Referenda for recognition of trade unions.
· Statutory amendments for expediting and streamlining the mechanism of Labour Judiciary.
· Amendments to Industrial Disputes Act in tune with the times.
· Efficient functioning of Labour Department.
· More labour sectors under Minimum Wages Act.
· Child labour act to be aggressively enforced.
· Modern medical facilities for workers.
· Rehabilitation packages for displaced workers.
· Restructuring in functioning of employment exchanges. Computerization and updating of data base.
· Revamping of curriculum and course content in industrial training.
· Joint cell of labour department and industries department to study changes in laws and rules.
· Kerala Institute of Labour & Employment to be upgraded.
· Policy progress monitoring team to review progress of implementation of policy.

IMPACT OF ECONOMIC LIBERALIZATION IN LABOR POLICY

Economic Liberalization:

Economic liberalization is the lessening of government regulations and restrictions in an economy in exchange
for greater participation by private entities; the doctrine is associated with classical liberalism. Thus,
liberalization in short is "the removal of controls" in order to encourage economic development. It is also closely
associated with neoliberalism. Most first world countries have pursued the path of economic liberalization in
recent decades with the stated goal of maintaining or increasing their competitiveness as business environments.
Liberalization policies include partial or full privatization of government institutions and assets, greater labor
market flexibility lower tax rates for businesses, less restriction on both domestic and foreign capital, open
markets, etc.

The economic liberalization in India refers to the ongoing economic liberalization, initiated in 1991, of the
country's economic policies, with the goal of making the economy more market-oriented and expanding the
role of private and foreign investment. Specific changes include a reduction in import tariffs, deregulation of
markets, reduction of taxes, and greater foreign investment. Its proponents for the high economic growth
recorded by the country in the 1990s and 2000s have credited liberalization. Its opponents have blamed it for
increased poverty, inequality and economic degradation.

Economic reforms may have given a boost to industrial productivity and brought in foreign investment in
capital-intensive areas. This has not created jobs and was not unexpected. According to a report by the
Washington based Institute of Policy Studies (IPS), the combined sales of the world's top 200 MNCs are now
greater than the combined gross domestic product (GDP) of all the world's nine largest national economies. Yet,
the total direct employment generated by these multinationals is a mere 18.8 millions -one-hundredth of one
per cent of the global workforce. India's labor force is growing at a rate of 2.5% annually, but employment is
growing at only 2.3%. Thus, the country is faced with the challenge of not only absorbing new entrants to the
job market (estimated at seven million people every year), but also clearing the backlog. Sixty percent of India's
workforce is self-employed, many of who remain very poor. Nearly 30% are casual workers (that is they work
only when they are able to get jobs and remain unpaid for the rest of the days they have no job). Only about
10% are regular employees, of which two-fifths are employed by the public sector (Prachi and Utsav, 2008).
More than 90% of the labor force is employed in the "unorganized sector", that is sectors which do not provide
social security and other benefits of employment as in the "organized sector”. In the rural areas, agricultural
workers form the bulk of the unorganized sector. In urban India, contract and sub-contract as well as migratory
agricultural laborers make up most of the unorganized labor force.
The ninth plan projects a decline in the population growth rate to 1.59% per annum by the end of the
ninth plan, from over 2% in the last three decades. However, it expects the growth rate of the labor force to
reach a peak level of 2.54% per annum over this period; the highest it has ever been and is ever likely to attain.
This is because of the change in age structure, with the highest growth occurring in the 15 - 19 years age group
in the ninth plan period.
The addition to the labor force during the plan period is estimated to be 53 millions on the "usual status"
concept. The acceleration in the economy's growth rate to 7% per annum, with special emphasis on the
agriculture sector, is expected to help in creating 54 million work opportunities over the period. This would lead
to a reduction in the open unemployment rate from 1.9% in 1996 - 1997 to 1.47% in the plan's terminal year,
that is, by about a million persons - from 7.5 to 6.63 million. In other words, if the economy maintains an annual
growth of 7%, it would be just sufficient to absorb the new additions to the labor force. If the economy could
grow at around 8% per annum during the plan period, the incidence of open unemployment could be brought
down by two million persons, thus attaining near full employment by the end of the plan period, according to
the plan. However, there appears to be some confusion about the figure of open unemployment. The
unemployment figure given in the executive summary of the ninth plan, gives the figure of open unemployment
at 7.5 million while the annual report of the Labor Ministry, for 1995 -1996, puts the figure for 1995 at 18.7
million. An internal government paper prepared in 1997 put the unemployment figure at the beginning of the
eighth plan at 17 millions and at 18.7 million at the end of 1994 - 1995. Perhaps the Planning Commission
referred to the current figure while the Labor Ministry’s figure referred to the accumulated unemployment
backlog.

EMPLOYEE WELFARE IN THE PRESENT INDIAN CONTEXT

ILO at its Asian Regional Conference, defined labour welfare as a term which is understood to include such
services, facilities and amenities as may be established in or in the vicinity of undertakings to enable the persons
employed in them to perform their work in healthy, congenial surroundings and to provide them with amenities
conducive to good health and high morale.

Welfare includes anything that is done for the comfort and improvement of employees and is provided over and
above the wages. Welfare helps in keeping the morale and motivation of the employees high so as to retain the
employees for longer duration. The welfare measures need not be in monetary terms only but in any kind/forms.
Employee welfare includes monitoring of working conditions, creation of industrial harmony through
infrastructure for health, industrial relations and insurance against disease, accident and unemployment for the
workers and their families. Labour welfare entails all those activities of employer which are directed towards
providing the employees with certain facilities and services in addition to wages or salaries.

Labour welfare has the following objectives:

• To provide better life and health to the workers

• To make the workers happy and satisfied
• To relieve workers from industrial fatigue and to improve intellectual, cultural and material conditions
of living of the workers.
The basic features of labour welfare measures are as follows:

• Labour welfare includes various facilities, services and amenities provided to workers for improving
their health, efficiency, economic betterment and social status.
• Welfare measures are in addition to regular wages and other economic benefits available to workers due
to legal provisions and collective bargaining.
• Labour welfare schemes are flexible and ever-changing. New welfare measures are added to the existing
ones from time to time.
Welfare measures may be introduced by the employers, government, employees or by any social or charitable
agency. The purpose of labour welfare is to bring about the development of the whole personality of the workers
to make a better workforce. The very logic behind providing welfare schemes is to create efficient, healthy,
loyal and satisfied labour force for the organization. The purpose of providing such facilities is to make their
work life better and also to raise their standard of living. The important benefits of welfare measures can be
summarized as follows:
 They provide better physical and mental health to workers and thus promote a
healthy work environment Facilities like housing schemes, medical benefits, and education and recreation
facilities for workers’ families help in raising their standards of living. This makes workers to pay more attention
towards work and thus increases their productivity. Employers get stable labour force by providing welfare
facilities. Workers take active interest in their jobs and work with a feeling of involvement and participation.
Employee welfare measures increase the productivity of organization and promote healthy industrial relations
thereby maintaining industrial peace. The social evils prevalent among the labours such as substance abuse, etc.
are reduced to a greater extent by the welfare policies.

Organizations provide welfare facilities to their employees to keep their motivation levels high. The employee
welfare schemes can be classified into two categories viz. statutory and non-statutory welfare schemes. The
statutory schemes are those schemes that are compulsory to provide by an organization as compliance to the
laws governing employee health and safety. These include provisions provided in industrial acts like Factories
Act 1948, Dock Workers Act (safety, health and welfare) 1986, Mines Act 1962. The non-statutory schemes
differ from organization to organization and from industry to industry.

STATUTORY WELFARE SCHEMES

The statutory welfare schemes include the following provisions:

Drinking Water: At all the working places safe hygienic drinking water should be provided.

Facilities for sitting: In every organization, especially factories, suitable seating arrangements are to be
provided.

First aid appliances: First aid appliances are to be provided and should be readily assessable so that in case of
any minor accident initial medication can be provided to the needed employee.

Latrines and Urinals: A sufficient number of latrines and urinals are to be provided in the office and factory
premises and are also to be maintained in a neat and clean condition.

Canteen facilities: Cafeteria or canteens are to be provided by the employer so as to provide hygienic and
nutritious food to the employees.

Spittoons: In every work place, such as ware houses, store places, in the dock area and office premises spittoons
are to be provided in convenient places and same are to be maintained in a hygienic condition.

Lighting: Proper and sufficient lights are to be provided for employees so that they can work safely during the
night shifts.

Washing places: Adequate washing places such as bathrooms, wash basins with tap and tap on the stand pipe
are provided in the port area in the vicinity of the work places.

Changing rooms: Adequate changing rooms are to be provided for workers to change their cloth in the factory
area and office premises. Adequate lockers are also provided to the workers to keep their clothes and belongings.
Rest rooms: Adequate numbers of restrooms are provided to the workers with provisions of water supply, wash
basins, toilets, bathrooms, etc.

NON STATUTORY SCHEMES

Many non-statutory welfare schemes may include the following schemes

Personal Health Care (Regular medical check-ups): Some of the companies provide the facility for extensive
health check-up

Flexi-time: The main objective of the flexitime policy is to provide opportunity to employees to work with
flexible working schedules. Flexible work schedules are initiated by employees and approved by management
to meet business commitments while supporting employee personal life needs

Employee Assistance Programs: Various assistant programs are arranged like external counselling service so
that employees or members of their immediate family can get counselling on various matters.

Harassment Policy: To protect an employee from harassments of any kind, guidelines are provided for

Proper action and also for protecting the aggrieved employee.

Maternity & Adoption Leave – Employees can avail maternity or adoption leaves. Paternity leave policies
have also been introduced by various companies.

Medic-claim Insurance Scheme: This insurance scheme provides adequate insurance coverage of employees
for expenses related to hospitalization due to illness, disease or injury or pregnancy.

Employee Referral Scheme: In several companies employee referral scheme is implemented to encourage
employees to refer friends and relatives for employment in the organization.

EMPLOYEE WELFARE IN IT SECTOR

Many employers are becoming contributing partners in welfare reform. With labor shortages, many employers
are looking to the welfare system as a source of new workers. More companies are providing child care,
transportation, meals, and other employment supports in order to hire and retain employees. Businesses are
interested in partnering with the public sector on post-employment services such as facilitating payroll direct
deposit or providing child care directly on site to help individuals balance work and family responsibilities.

Welfare reform magnifies the fact that necessary and appropriate services do not always exist in the state.
Overcoming barriers to employment such as transportation, child care, and job training will help all workers.
Providing needed services requires collaboration and closer relationships among public and private agencies
that may have not worked together before.

State welfare and workforce development officials are fast recognizing that by enhancing the skills of current
employees, jobs for individuals leaving welfare will become available. Some companies are upgrading the skills
of already employed workers so they can advance on the career ladder and entry level positions can be made
available for others.

Employee welfare entails all those activities of employer which are directed towards providing the employees
with certain facilities and services in addition to wages or salaries.

Employee welfare has the following objectives:

1. To provide better life and health to the workers

2. To make the workers happy and satisfied
3. To relieve workers from industrial fatigue and to improve intellectual, cultural and material conditions
of living of the workers.

IT Companies
The pay in software companies is very good as compared to other industries in India and the work places are
generally well furnished and plush offices. But the IT work culture in India is totally messed up and has now
started harming the work culture of the nation as a whole. The working time is up to 12+ hours a day and 6 or
even 7 days a week is more the rule than the exception.

In context of Labour Laws IT companies come under all laws except Factories Act . They come under Shop &
establishment Act, ID Act, Minimum Wages, Payment of Wages, Payment of Gratuity, EPF, ESIC etc

Organizations provide welfare facilities to their employees to keep their motivation levels high. The employee
welfare schemes can be classified into two categories viz. statutory and non-statutory welfare schemes. The
statutory schemes are those schemes that are compulsory to provide by an organization as compliance to the
laws governing employee health and safety. These include provisions provided in industrial acts like Factories
Act 1948, Dock Workers Act (safety, health and welfare) 1986, Mines Act 1962. The non statutory schemes
differ from organization to organization and from industry to industry.
When it come to the working hours which is the major issue in an IT sector , weekly no adult is required to or
allowed to work more than 48hours
This 48 hours is calculated as :
10 hrs p.day x 5 working days = 50 hrs less 0.30 minutes break for 5 working days = - 2.5 hrs = 47.5