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Employment and Labour Laws in India - LawSimpl

Employment and Labour Laws in India

Indian Labour Laws

Labour law is also known as ‘employment law’ is a structure of laws, organizational rulings, and precedents, which determines the legal rights and restrictions on working employees and their organization. This law covers industrial relations, labor-management relations, collective bargaining and unfair labor practices, health & safety in a workplace, and employment standards including leaves, working hours, minimum wage, etc. India has over more than 50 laws that cover subjects such as industrial relations, trade unions, etc that talk about their employment and termination. Many of these acts have been existing since colonial times. Laws regarding ‘Labour’ can be formulated by either the state or the central government as this comes under the concurrent list of the Indian Constitution.

Sectors included in labour laws

Labour laws revolve around subjects such as Industrial Disputes Act, Workmen Compensation Act, Equal Remuneration Act, Maternity Benefit Act, Child Labour Act, Factories Act, Mines Act, Contract Labour Act, Welfare fund Act, etc.

Sectors not included in labour laws

Labour laws do not include a subject that does not qualify as a ‘workman’ under the Industrial Dispute Act, 1947, which includes people who are not employed in such industry, who does work entirely different as specified in these provisions, no existence of a master-servant relationship. For eg. People employed under the Air Force Act, Army Act, or Navy; someone employed in a managerial capacity.

Top 10 rights for employees under Labour laws:

1. Minimum Wages

– Every worker should be aware of the minimum wages he is supposed to receive for the amount of job done. This varies state to state and also on factors such as the employee is skilled or unskilled, which category one belongs to, the number of hours worked, and which industry you work in.

2. Provident Fund

– Every employee should subscribe to the EPFO. These are kinds of savings for the employees that are deducted from their salary and are deposited in a provident fund account. And the employees can also avail tax benefits.

3. Payment of Wages

– The employees should keep in mind, that the payment of wages is done by the 7th of every month and the employer is supposed to provide details of the deductions if any.

4. No discrimination in terms of wages or salary

– The company recruiting employees or workers for the same job with the same qualifications, then there should be no discrimination based on caste, color, or sex, even in regards to payment of wages.

5. Right to Medical Insurance and Accidental Insurance

– Workers have the right to get medical as well as accidental insurance for which 0.75% is deducted from their income or wages for contribution to the insurance scheme and the employer contributes 3.25% additional premium on behalf of the workers. This is only applicable while you have active employment.

6. Bonuses

– Central Government has authorized all employers to pay a statutory bonus of a minimum of 8.33% of employees’ wages or salaries every year. This is a compulsory bonus and is not capped at 8.33% and can extend up to 20% depending upon the performance of the company.

7. Right to Gratuity

– If the employees have been working under a company for more than 5 years and plan to quit, in that case, the company has to pay an amount called gratuity to that employee as a token of gratitude.

The employee is to be paid for 15 working days every year.

8. Overtime

– If the employee or worker works overtime in any case, he is entitled to get an extra wage or salary for the same.

9. Gazetted Holidays

– These are mandatory holidays across the country and all offices are shut during these holidays, in case any company calls their employees to work, they will have to pay them double wages and are also entitled to such leave anytime within 90 days.

10. Maternity Leaves

– Women employees after the recent amendment is now eligible to get paid maternity leaves for 26 weeks, for mothers having birth via surrogacy or adoption get 12 weeks paid maternity leaves.

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