EWSS UNIT-1

Labour Welfare In Indian Perspective

Introduction
Definition
Objectives of Labour Welfare
Importance of Labour welfare activities
Theories of Welfare
Principles of Labour Welfare
Need and Scope of Labour Welfare
Classification of Labour Welfare Activities
Labour Welfare in India: Pre – Independence
Labour Welfare in India: After Independence
Welfare practices in India presently
Various Constitutional provisions for labour welfare in India

LABOUR WELFARE IN INDIAN PERSPECTIVE

Introduction
The term welfare brings in many ideas, meaning to state wellbeing, good health, happiness,
prosperity and the development of human resources. The concept of welfare has been a total
concept involving physical, mental, moral and emotional wellbeing of individual.

The social concept of welfare implies the welfare of man, his family and his community. It is an
interconnection of threes three aspects in the sense that all these work together and individually
supplement one another.

Definition
 We can understand labour welfare as the “efforts to make life worth living for worker”.
 Another definition on labour welfare states that “anything done for the comfort and
improvement, intellectual and social of the employees over and above the wages paid, which
is not a necessity of the industry.”
 The most significant definitions describes labour welfare work as “ the voluntary effort of the
employer to improve the living and working conditions of his employees, the underlying
assumption of course being that the first essentials to the welfare of the employees are steady
work, a fair wage and reasonable hours of labour “.

Objectives of Labour Welfare

In the beginning humanitarianism and social awareness motivated labour welfare activities.
Driven by the desire for greater efficiency and output from workers and with a view to attract
better workers, employers lured them into their organisation through labour welfare measures.
Labour welfare measures are often undertaken to avoid paying of tax on surplus and
simultaneously building up good relations with the employee. Sometimes labour welfare
measures are undertaken to meet the minimal requirements that is followed by other
organisations in the industry.

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Following are the objectives of the voluntary labour welfare services by employer:
1. To win over employees loyalty and increase their morale.
2. To develop efficiency and productivity among workers.
3. To save one self from heavy taxes on surplus profits.
4. To reduce of threat of further government intervention.
5. To make recruitment more effective.
6. To give expression to philanthropic and paternistic feelings.
7. To combat trade unionism and socialist ideas.
8. To earn good will and enhance public image.
9. To build up stable labour force, to reduce labour turnover and absenteeism.

Importance of Labour welfare activities.

Labour welfare in India has a special significance as the constitution provides for the promotion
of welfare of the labour for humane condition of work and securing to all workers leisure, social
and cultural opportunities. Labour welfare is measure to promote the efficiency of labour. The
various welfare measures provided by the employer will have immediate impact on the health,
physical and mental efficiency, alertness, morale and overall efficiency of the workers and
thereby contributing to the higher productivity. Moreover, the workmen require protection from
certain calamities which imperial their efficiency. Social security measure provided by employer
will act as a protection to the workers. Social security aims at providing collective measures to
protect the members of a community against social risk as their individual resources are seldom
adequate to after protection against hardship. Both assistance and social insurance from integral
parts of the system of social security. Labour welfare introduces the extra dimension to industrial
relationship which ever a satisfactory wage alone cannot provide. Labour welfare express the
humane interest as enlightened employer has in the well-being and contentment of the people
who work for him. Labour welfare means activities designed for the promotion of the economic,
social and cultural well-being of the employees. The term labour welfare includes anything done
for intellectual, physical, moral and economic betterment of worker by government or by other
agencies over and above what laid down by law in various contingencies like illness,
unemployment, disability and death which have direct impact on the well-being of the worker
and the dependent.

Following are the reasons for the labour welfare activities in India:
a) Increase in the efficiency of the employees – Labour welfare activities increase in efficiency
of the employees to work. These facilities help in developing the feeling of dedicating among
them. Due to the increase in efficiency the production and productivity of the enterprises
increase considerably.
b) Helpful in reducing the state of poverty among employees – A great problem in industrial
development of our country is extreme poverty among Indian workers. Most of the workers
in our country struggle to fulfill the basic needs for themselves and that of their family
members. Provision of labour welfare activities plays an important role in reducing such
poverty and providing essential amenities to the workers.
c) Establishing Industrial peace. – Labour welfare activities help in establishing harmonious
relations between employees and employers. Employees realize that they are getting all
possible facilities, and the employer take care of them, Such feeling among employees is
helpful in establishing industrial peace.
d) Helpful in maintaining health and physical ability of employees – most of the Indian workers
are unhealthy and ill fed. It reduces the production capacity of the employees. Provision of

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 nourishing food and medical facilities help in maintaining health physical ability of the
employees.
e) Helpful in reducing the rate of absenteeism and labour turnover- The rate of absenteeism and
labour turnover is much higher in India as compared to that of developed countries of the
world. Provision of labour welfare activities help reducing this arte because the workers feel
themselves well settled at one place.

Theories of Welfare
The Police Theory – is based on the contention that a minimum standard of welfare is necessary
for labourers. The theory assumes that without compulsion, periodical supervision and fear of
punishment, employers will not be ready to provide even the minimum welfare amenities.
Further, the theory is based on the conclusion that man is self-centered and selfish and always
tries to achieve his own ends even at the cost of the welfare of others. If wealth, authority is at
his ends, he would take advantage of the same and exploit the work force for his individual sake.
Therefore the theory postulate that the welfare state has to step in to prevent these atrocities and
exploitation and force industrialists to offer minimum standard of welfare to their workers. Thus
various laws are promulgated in order to compel every organisation to provide the minimum
standard welfare measures.

The Religious Theory – is propounded on the concept that a man is essentially a religious
animal. Even today many acts of man are related to religious sentiments and beliefs. Hence these
religious feelings sometimes prompt an employer to take up welfare activities in the expectation
of future benefits either in his life or in some future life. According to the theory, any good work
is considered an investment both the benefactor and the beneficiary are rewarded, based on this
philosophy many charitable and other religious institutions have come into existence.
Another aspect of the religious theory is the atonement aspect, as some people take up welfare
work in a spirit of atonement for their sins and any welfare act is treated either as an investment
or an atonement.

Philanthropic Theory – is based on man‟s love for mankind. In Greek philos means loving and
anthropes mean man and hence loving mankind becomes the key factory for the theory. Man is
believed to have an instinctive urge by which he strives to remove the suffering of others and
promote the wellbeing and this being very powerful drive it impels him to perform noble
sacrifices.

Trusteeship Theory – also called as paternalistic theory of labour welfare says that the
industrialist or employer holds the total industrial estate, properties and profits accruing from
them in trust. Hence he uses them for himself and for the benefit of his workers and for the
[Link] the workers are treated as minors and they are ignorant because they lack in
education and they are not able to look after themselves. Therefore employers have the moral
responsibility to look after the interest of their wards who are the workers. Here there is no
binding or obligation legally but only morality issues are raised.

The Placating Theory –is based on the act that labour groups are becoming demanding and
militant. They are more conscious of their rights and privileges than ever before. Their demand
for higher wages and better standards cannot be ignored and hence it said that the timely and
periodical acts of labour welfare can appease the workers.

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Public Relations Theory – provides the basis for an atmosphere of goodwill between labour and
management and also between management and the public. Labour welfare programmes under
this theory work as a sort of an advertisement and help an industrialist to build up good and
healthy public relations. The theory is based on the assumption that the labour welfare movement
may be utilized to improve relations between management and labour.

The Functional Theory – also known as efficiency theory, welfare work is used as a means to
secure, preserve and develop the efficiency and productivity of labour. It is obvious that if an
employer takes good care of these workers, they will tend to become more efficient and will
thereby step up production. Thus this depends on the healthy relationship between the union and
management and their mutual concern for the growth and development of the industry.

Principles of Labour Welfare

Principle of Adequacy of Wages – labour welfare measures cannot be a substitute for wages,
workers have a right to adequate wages, but high rate of wages alone cannot create a healthy
environment nor would bring in commitment on the part of the workers. A combination of social
welfare, emotional welfare and economic welfare together would achieve good results.

Principle of Social Responsibility – according to this principle, industry has an obligation

towards its employees to look after their welfare and this is also backed by the constitution of
India in its directive principles of the state policy.

Principles of Efficiency – plays an important role in welfare services and is based on the
relationship between welfare and efficiency, though it is difficult to measure this relationship.
Whether one accepts the social responsibility of industry or not, the employer quite often accepts
the responsibility for increasing such labour measures as would increase efficiency. For eg. Diet
planning in canteens.

Principle of Re-personalisation - the development of human personality is found to be the goal of

industrial welfare and this principle should counteract the baneful effects of the industrial
system. Therefore it is necessary to implement labour welfare services, both inside and outside
the factory.

Principle of Totality of Welfare – emphasizes that the concept of labour welfare must spread
throughout the hierarchy of an Organisation and employees at all levels must accept this total
concept of labour welfare without which the labour welfare would not be implemented.

Principle of Co-ordination – is a concept of co-ordinated approach that will promote a healthy

development of the worker in his work, home and community. This is essential for the sake of
harmony and continuity in labour welfare services.

Principle of Democratic Values – cooperation of the worker is the basis of this principle and thus
consultation and the agreement of the workers in the formulation and implementation of the
labour welfare services are very necessary for their success. Moreover workers allowed to
participate in planning these programmes get keenly interested in their proper implementation.
This principle is based on the assumption that the worker is a mature and rational individual and
industrial democracy is the driving force here and workers also develop a sense of pride when
they are made to feel that labour welfare programmes are created by them and for them.

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Principles of Responsibility – recognizes the fact that both employers and workers are
responsible for labour welfare. Trade unions too are involved in these programmes in a healthy
manner, for basically labour welfare belongs to the domain of the trade union activity.
Further, when responsibility is shared by different groups, labour welfare work becomes simpler
and easier. Accordingly various committees are elected or nominated and various powers and
responsibilities in the welfare field are delegated to them. For Eg. Safety committee, the canteen
supervision committee etc.
Principle of Accountability – is also known as principle of evaluation. Here one responsible
person gives an assessment or evaluation of existing welfare services on a periodical basis to a
higher authority. In this criteria one judge the success of labour welfare programmes.

Principle of Timeliness – The timeliness of any service helps in its success. To identify the
labour problem and to discover what kind of help is necessary so solve it and when to provide
this help are all very necessary in planning labour welfare programmes.

Principle of Self Help – is the facts that labour welfare must aim at helping workers to help
themselves in the long run. This helps them to become more responsible and more efficient.

Need and Scope of Labour Welfare

The need for labour welfare was strongly felt primarily to protect every industrial worker from
the hands of their employers. The mission to protect labour was emphasized in the state
directive principles of the following article.
Article 41 – The state shall within the limits of its economic capacity and development make
effective provision for securing the right to work, to education and to public assistance in cases
of unemployment, old age, sickness and disablement and in other cases of underserved want.
Article 42 – The state shall make provision for securing just and humane conditions of work and
for maternity relief.
Article 43 – The state shall endeavour to secure, by suitable legislation or economic organisation
or in any other way, to all workers, agricultural, industrial or otherwise work a living wage,
conditions of work ensuring a decent standard of life and full enjoyment of leisure and social and
cultural opportunities and in particular the state shall endeavour to promote cottage industries on
an individual or cooperative basis in rural areas.

Some of the necessities for the Labour Welfare Measures to introduced

 The strength of the workforce is increasing year after year and hence, need for a mechanism
to look into the welfare of the labour.
 Workers put in long hours of work in unhealthy surrounding and the drudgery of the factory
work continues to have adverse effect. To counter these welfare measures were felt
necessary.
 As a result of hard work, they fall prey to alchoholism, gambling and other immoral activities
results in absenteeism and other problems in the organisation. Hence the need was felt.
 Good education and training facilities for workers were also felt necessary as there was high
rate illiteracy and lack of proper education background.
 Good training provided will reduce industrial accidents, increases workers efficiency and
create a sense of commitment among the workers.

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 Welfare activities like family planning, child welfare facilities and maternity care assist
workers in a variety of ways, which would reduce the mortality rate and maintain good health
of the spouse and children of the family, which would create a confident note in the workers.
 Promoting welfare activities lead to better working conditions and standards for industrial
workers.

The Indian constitution (was adopted by the Constituent assembly on Nov 26, 1949 and came
into force on Jan 26, 1950) makes a specific mention of duties the state owes to labour apart
from the factories act of 1948. Thus Labour is a subject in the Concurrent List where both the
Central and the State Governments are competent to enact legislation subject to certain matters
reserved for the Centre.

The nation passes through various stages of development and more people join the workforce
contributing to the economic growth of the country. The majority of the labour population is in
the unorganized sector like Agriculture, Plantation workers, fisheries, Mining, Firecracker, Beedi
workers, Toddy tappers, Heavy Machine works, etc, and so labour welfare measures are a crucial
component. The Ministry of Labour and Employment under the GoI is responsible for the
protection and safeguard of workers with a special focus on the disadvantageous section of the
society. Laws are enacted, implemented and amended from time to time. The important ones
being – Minimum wages, Occupational Safety, Industrial Relations. Another important
milestone is the passing of the “Unorganised workers social security Act 2008”.

The scope of Labour Welfare include: -

 Contribute to the productivity of labour and efficiency of the enterprise
 Raise the standard of living of workers by indirectly reducing the burden on their purse
 Be in tune and harmony with similar services obtaining in a neighbouring community where
an enterprise is situated.
 Be based on an intelligent prediction of the future needs of industrial work and be so
designed as to offer a cushion to absorb the shock of industrialization and urbanization
 Be administratively viable and essentially development in outlook.
 However no labour welfare activities can be limited to facilities, within or near the
undertaking nor can it be comprehensive as embrace the whole range of social welfare or
social services. It therefore follows all the extra mural and intra mural welfare activities as
statutory or non-statutory welfare measures undertaken by employers.
 It bring under its purview all welfare activities and amenities related to canteen, rest and
recreation facilities, medical assistance, better health, nutrition and sanitation, travel to and
from work, education, housing, holiday facilities and so on.
Classification of Labour Welfare Activities
In the year 1959, government of India appointed a study team to examine the entire range of
labour welfare activities and to make recommendations for their inclusion in the Third Five Year
plan. The team divided the entire range of labour welfare activities into three groups.

1. Welfare within the precincts of an establishment, medical and crèches, canteens and supply
of drinking water.
 Latrines and urinals
 Washing and bathing facilities
 Crèches‟
 Rest shelters and canteens
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 Arrangement for Drinking water
 Arrangement for the prevention of fatigue
 Health services, including occupational safety
 Administrative arrangements within a plant for welfare
 Uniforms and protective clothing and shift allowance.

2. Welfare outside the establishment, provision of indoor and outdoor recreation, housing,
adult education and visual instructions.
 Maternity benefits
 Social insurance measures, including gratuity, pension, provident fund, rehabilitation
 Benevolent fund
 Medical facilities including programmes for physical fitness and efficiency, family planning
and child welfare
 Education facilities, including adult education
 Housing facilities
 Recreation facilities, including sports, cultural activities library and reading room
 Holiday Homes and leave travel facilities
 Workers cooperatives including consumers, cooperatives stores, fair price shops and co-
operative thrift with credit societies.
 Vocational training for dependents of workers
 Other programmes for welfare of women, youth and children
 Transport facilities to and fro from work.

3. Social Security.
Over and above all these the act makes a provision for the appointment of a welfare officer in the
establishment itself who will look after the implementation of the various statutory provisions.
Labour Welfare in India
Pre – Independence
The origin of labour welfare activity in India goes back to 1837, following the abolition of
slavery in the year 1833 and British colonies started importing Indian labour. Then the labour
welfare activity was mainly controlled by legislation and the earliest act in this regard was the
Apprentices Act of 1850, which was passed to protect the orphaned children to learn various
trades with the help of experienced craftsmen.

The next act was the Fatal Accidents Act of 1853 aimed at providing compensation to the
families of workmen who lost their lives as a result of any actionable wrong at workplace. This
act was followed by the Merchant shipping act of 1859, which intended to regulate the
employment of seamen and provided for their health, accommodation and protection.

The review of all these early enactments shows that they were drawn up with specific objectives
and that they do not indicate any planned policy or approach to the labour welfare. Thus they
were only attempting to regulate employment rather than improve their working conditions of
labour.22 years elapsed after the shipping act before the first Indian factories act was passed in
1881, which marked the beginning of a series of labour laws that brought improvements in the
working conditions of labour. The conditions of the labour that worked in the textile mills in
Bombay in the 1870 onwards were the immediate cause for this act to be enacted.

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Some of the conditions of the workers during those time were, children below the age of 8 years
were employed, the hours of work was between sunrise to sunset, there were no fixed holidays
and under all normal conditions the mills were working for not less than 320 days in a year and
the conditions inside the working area were not fit for humans to work and the levels of safety
was inadequate.

Thus the Indian Factories Act of 1881 was made applicable to all the factories using mechanical
power employing not less than 100 persons and working more than 4 months in a year. Further
the following is highlighted of the act.
 Children below the age of 7 could not be employed, while those between the age of 7 and 12
were not to work for more than 9 hours a day.
 They were also to get 4 holidays every month
 State was empowered to appoint factory inspectors to oversee the functions of the factories
 Dangerous machineries were to be properly fenced and every accident need to be reported to
the factory inspector.
Following the international conference on labour at Berlin, and on the advice of the special
commission on labour the following amendments were made in the year 1891 to the factories act
of [Link] applied to all the factories employing 50 persons or more and could be extended to
those who have 20 workers.
 A mid-day break for half an hour was made compulsory
 A weekly off day was prescribed
 Women were allowed to work for a maximum of 11 hours with a break for 1 and half hours.
 The lower age limit for the worker was raised from 9 years to 14 years and were not allowed
to work for more than 7 hours a day.
 Local governing bodies were empowered to make rules regarding sanitation and other
amenities for workers
 Provisions were made for inspection and penalties for breach of any provision of Factory
Act.

This act could also not come of certain drawbacks like

 It did not apply for those factories that did not work for more than 120 days in a year.
 Safety provisions in the act were also found to be inadequate and legally the manager of the
factory was not an occupier and could not therefore be punished for breach of the provisions
of the act.

During these periods various voluntary actions in the fields of labour welfare also made
considerable progress. Group efforts came to the forefront. The amalgamated society of railway
servants of India and Burma, formed in the year 1897 started a number of friendly benefit
schemes, the printers union in Calcutta and the postal union in Bombay were respectively
organized in 1905 and 1907. They introduced mutual insurance schemes, night schools,
educational stipends and funeral allowance. In the year 1910 the Kamgar Hitwardhak Sabha was
established with the aim to help workers in a variety of ways and the most important being the
labour welfare functions.

After Independence
The labour welfare movement acquired new dimensions. For the requirement of massive
investments in industry during this period, it was felt necessary that labour welfare played a
positive role in increasing productivity and reducing industrial tensions. The state too seriously
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took its social responsibility to the weaker and working sections of the population. Thus the
factories act of 1948 was enacted that replaced all previous legislations.

Welfare practices in India presently

Many welfare amenities described in the main report of the labour investigation committee have
become a part of the statutory obligations. The different welfare amenities are under the various
heading as follows.
 Sanitary and Hygiene Facilities
 The maintenance of a clean, sanitary and hygienic working environment is now accepted as
an important basic welfare amenity that would include toilets, water for drinking and
washing.
 The factories act requires that every factory must be kept clean and free from effluents
flowing from any drain, that a sufficient supply of wholesome drinking water must be made
available at suitable and convenient points and separate latrines and urinals for male and
female workers be provided and spittoons and washing facilities be provided .
 Rest facilities
 This amenity prescribes a prescribed number of seats on the shop floor and in rest rooms or
shelters in order to reduce fatigue as it enables a worker to take a break. Further the act also
makes provisions for lunch rooms to be provided if there are more than 150 workers and
these places be clean, well-lighted and ventilated and provided with adequate furniture and
drinking water wherever necessary.
 Feeding facilities
 Every factory employing 150 or more workers should provide a lunch room with provision
for drinking water to enable workers to eat the meals brought by them and where over 250 or
more workers are employed, there should be a canteen or canteens.
 In fulfilling the objectives of an industrial canteen, several points like the following should
be kept in mind.
 It should be managed on a nonprofit basis.
 The canteen has to be roomy, clean, bright and well placed in the factory
 Should have comfortable and friendly atmosphere
 The food supplied in the canteen should be adequate and of good quality.
The three ways of administering the industrial canteens are
 Directly by the employers
 by a contractor and
 By a co-operative society of workers.

 Medical Facilities - The importance of preventive and curative medical care has increased
and it is now accepted theory that health care for workers will help to reduce the incidence of
sickness and therefore absenteeism among them and will increase productivity.
- The Factories Act of 1948 provided for cleanliness, disposal of wastes and effluents,
ventilation and temperature control, dust and fume, artificial humidification, restriction
regarding overcrowding, lighting, drinking water arrangements, latrines and urinals and
spittoons etc.,
- Statutory medical facilities were also provided under the Employees State Insurance Act
1948, with subsequent amendments. This act extends such benefits to industrial workers as
maternity benefits, disablement benefits, dependents‟ benefits, sickness benefits and medical
benefits, while medical care and cash benefits were also provided for workers.

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Apart from the medical and health facilities provided by legislation and by some employers on a
voluntary basis, other similar services have been organised by workers by labour welfare center
and some trade unions.

Various Constitutional provisions for labour welfare in India.

Labour welfare in India - The directive principle of state policy in our constitution express the
need for labour welfare. Following acts are there in the constitution for labour.
 Article 32 - The state shall make effective provisions for securing the right to work, to
education and to public assistance in case of unemployment, old age, sickness, disablement
and other cases of undeserved want.
 Article 33 - The state shall make provisions for securing just human conditions of work and
for maternity relief.
 Article 39 – The state shall in particular direct its policy towards securing:
 that the citizen, men and women equally have the right to an adequate means of
livelihood
 that the operation of the economic system does not result in the concentration of wealth
and means of production to the common detriment.
 That the ownership and control of the material resources are so distributed as to sub serve
the common good.
 that the health and strength of workers men and women and tender age of children are not
abused and that citizens are not forced by economic necessity to enter a vocation unsuited
for their age and strength.
 that there is equal pay for equal worker for both men and women.
 Article 41 – The state shall within the limits of its economic capacity and development, make
effective provisions for securing the right to work, to education and to public assistance in
cases of underserved wants.
 Article 42 - the state shall make provision for securing just and human conditions of work
and maternity relief.
 Article 43 – The state shall endevour to secure by suitable legislation or economic
organisation or in any other way, to all workers, agricultural industrial or otherwise, work, a
livening wage, condition of work ensuring decent standards of life and full employment of
leisure and social and cultural opportunities and in particular, the state shall endevour to
promote cottage industries on an individual or co – operative basis in rural areas.
 Article 43 A – the state shall take steps by suitable legislation or in any other way to secure
participation of workers in development of undertaking, establishments or other
organisations engaged in industry.

1. Occupational Health & Safety - These are essentially preventive, very common in the
industrially advanced countries and it is gaining importance and recognition in the large sized
undertakings in our country. One of the main functions under this service is to protect workers
against the health hazards arising out of the nature of their work or the work environment. This
service includes carrying out periodical medical checks for categories of workers to detect early
signs of ill health and prevent them from serious health complaints.

Major legislations are

 The Factories Act, 1948
 The Mines Act, 1952

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  The Dock Workers (Safety, Health & Welfare) Act, 1986
2. Trade Unions: Industrial & Labour Disputes (Industrial Relations Act 1990)
 The right to join a trade union
 Provides workers who take part in peaceful industrial actions certain immunities -
selective
 Unfair dismissal (Act 1977)
3. Industrial Disputes concerning Union Employees
4. Social Security & Insurance

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 EWSS UNIT-2
ILO – International Labour Organization
Classification of Labour Welfare Activities
1. Extra mutual activities
2. Intra mutual activities
Welfare practices in India
Statutory & Non-Statutory Welfare Schemes
Factories Act of 1948
Who is labour welfare officer? Discuss the duties and
function of labour welfare officer.
Discuss in brief the various agencies for labour welfare work
in India.
ILO – International Labour Organization
Established on October 29, 1919 as an agency of the League of Nations following the treaty of
Versailles, which ended the world war I. in 1998, in the 86th ILO-conference adopted the
declaration on Fundamental Principles & Rights at work. These were – (1) right of workers to
associate freely & bargain collectively (2) the end of forced or compulsory labour (3) the end of
child labour (4) end to unfair discrimination among workers. Today ILO has 187 member
countries. In January 2019 ILO published a report to mark the organizations‟ centenary in which
ten recommendations are made to the government to meet the unprecedented challenges of the
changing world of works. Some of the key recommendations are universal labour guarantee,
social protection from birth to old age, entitlement to life-long learning. ILO is the major
provider of labour statistics and it provides the „Key Indicators of Labour Market‟.

International Labour Organization‟s World Employment and Social Outlook: Trends 2019 report
(WESO) observed that the progress in reducing unemployment globally is not being matched by
improvements in the quality of work.

GENEVA (ILO News) – Poor quality employment is the main issue for global labour markets,
with millions of people forced to accept inadequate working conditions, according to a new
report from the International Labour Organization (ILO). New data gathered for the World
Employment and Social Outlook: Trends 2019 (WESO) show that a majority of the 3.3 billion
people employed globally in 2018 had inadequate economic security, material well-being and
equality of opportunity. What’s more, progress in reducing unemployment globally is not being
reflected in improvements in the quality of work. The report, published by the ILO, cites the
persistence of a number of major deficits in decent work, warning that, at the current rate of
progress, attaining the goal of decent work for all, as set out in the Sustainable Development
Goals (SDGs), particularly SDG 8 seems unrealistic for many countries.

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The report cautions that some new business models, including those enabled by new
technologies, threaten to undermine existing labour market achievements – in areas such as
improving employment formality and security, social protection and labour standards –
unless policy-makers meet the challenge. “Being in employment does not always guarantee
a decent living,” said Damian Grimshaw, ILO Director of Research. “For instance, a full
700 million people are living in extreme or moderate poverty despite having employment.”

Among the issues highlighted is the lack of progress in closing the gender gap in labour
force participation. Only 48 per cent of women are in the labour force, compared to 75 per
cent of men. Women also make up far more of the potential, underutilized, labour force.
Another issue is the persistence of informal employment, with a staggering 2 billion
workers – 61 per cent of the world‟s workforce – categorized as such. Also of concern is
that more than one in five young people (under 25) are not in employment, education or
training, compromising their future employment prospects.

The annual report also highlights some pockets of progress. Should the world economy
manage to avoid a significant downturn, unemployment is projected to decline further in
many countries. There has also been a great decrease in working poverty in the last 30
years, especially in middle-income countries, and a rise in the number of people in
education or training.

Main regional findings:

Africa - Only 4.5 per cent of the region‟s working age population is unemployed, with 60
per cent employed. However, rather than indicating a well-functioning labour market, this
is because many workers have no choice but to take poor quality work, lacking security,
decent pay and social [Link] labour force is projected to expand by more than 14
million per year. Economic growth rates until 2020 are expected to be too low to create
enough quality jobs for this fast-growing labour force.

Northern America - Unemployment is expected to reach its lowest level, 4.1 per cent in
[Link] employment growth and economic activity are projected to begin declining in
[Link] with basic education are more than twice as likely to be unemployed as those
with advanced [Link] sub-region is a leader in digital labour platforms. Close
monitoring of such work is a growing issue for policy-makers.

Latin America and the Caribbean - Despite rebounding economic growth, employment is
expected to rise by only 1.4 per cent per year in 2019 and [Link] relatively slow fall in

Ashok Mammen V Assistant professor

regional unemployment figures is a result of different labour market conditions in
individual [Link] and poor job quality remain pervasive in all types of
employment.

Arab States - Regional unemployment is projected to remain stable at 7.3 per cent until
2020, with unemployment in non-Gulf Cooperation Council (GCC) countries reaching
double that of the [Link] workers account for 41 per cent of total regional
employment, and in GCC countries more than half of all workers are migrants, on
[Link] women‟s unemployment rate, at 15.6 per cent, is three times that of men.
Youth are also disproportionately affected and the youth unemployment rate is four times
the adult rate.

Asia and the Pacific - Economic growth continues, albeit at a slower rate than in previous
[Link] regional unemployment rate is projected to remain at around 3.6 per cent until
2020, below the global [Link] transformation has moved workers out of
agriculture, but this has not created significant improvements in job quality; a large
proportion of workers lack job security, written contracts and income [Link] social
protection has been significantly extended in some countries, it remains extremely low in
those countries with the highest poverty rates.

Europe and Central Asia - In Northern, Southern and Western Europe, unemployment is
at its lowest in a decade and is set to continue falling until [Link] Eastern Europe the
number of people in employment is expected to shrink by 0.7 per cent in both 2019 and
2020, but a simultaneously shrinking labour force means the unemployment rate will
[Link]-term unemployment is as high as 40 per cent in some [Link]
remains widespread, at 43 per cent, in Central and Western [Link] poverty, poor
job quality and persistent labour market inequalities remain concerns.

The 2030 Agenda embraces the three dimensions of sustainability – economic, social and
environmental. It has 17 Sustainable Development Goals (SDGs) that will build on the
progress achieved under the Millennium Development Goals (MDGs). It was formally
adopted by world leaders gathering at a United Nations special summit in September 2015
in New York.

MILLENNIUM DEVELOPMENT GOALS (MDGs)

1. Eradicate extreme poverty and hunger

2. Achieve universal primary education

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3. Promote gender equality and empower women

4. Reduce child mortality

5. Improve maternal health

6. Combat HIV/AIDS, malaria and other disease

7. Ensure environmental sustainability

8. Develop a global partnership for development

17 SUSTAINABLE DEVELOPMENT GOALS

1. No Poverty

2. Zero hunger

3. Good health

4. Quality education

5. Gender equality

6. Clean water and sanitation

7. Affordable and clean energy

8. Decent work and Economic growth

9. Industry, innovation and infrastructure

10. Reduced inequalities

11. Sustainable cities and communities

12. Responsible consumption

13. Climate action

14. Life below water

15. Life on land

16. Peace and justice

17. Partnership for the goals

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Constituents of labour welfare activities –

Dr. Broughton has divided labour welfare activities into two broad categories

1. EXTRA MUTUAL ACTIVITIES – These are the activities that are provided by an
enterprise for the welfare of their employees outside the enterprises. These activities
include the following

i. Facilities of recreation. For this purpose, the arrangement can be made for clubs,
libraries, reading room, gymnasium etc.

ii. Provisions for nourishing food to the employees at the price that they can afford.

iii. Arrangement of co –operative societies from where the employees may purchase the
goods and services of daily use at reasonable prices.

iv. Provisions for gratuity and pension.

v. Arrangement for the education and training for the workers and the facilities of
education for the children or workers.

vi. Arrangement of proper housing accommodation for the employees at the rent that
they can afford easily.

vii. Provisions for provident fund

viii. Provisions for the benefits of sickness and maternity.

ix. Facilities of transportation to collect the employees from their homes and to drop
them back.

x. Group insurance scheme.

2. INTRA MUTUAL ACTIVITIES – In this category of labour welfare activities those

facilities are included which are made available to the workers within the organisation.
These facilities include the following:

i. Arrangement for the prevention of accidents. It includes the arrangement or

protection against dangerous machines, fire and extreme fluctuations of power etc.

ii. Facilities of health and medical case for the employees and their family members

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iii. Arrangement of proper working conditions such as proper lighting, fresh air,
drinking water, ventilation etc.

iv. Scientific selection appointment of workers for different jobs.

v. Other activities for the welfare of workers, such as – the facilities of canteen, rest
room clubs etc.

vi. Provision of industrial training for different jobs.

Welfare practices in India

Many welfare amenities described in the main report of the labour investigation committee
have become a part of the statutory obligations. The different welfare amenities are under
the various heading as follows.

 Sanitary and Hygiene Facilities

 The maintenance of a clean, sanitary and hygienic working environment is now

accepted as an important basic welfare amenity that would include toilets, water for
drinking and washing.

 The factories act requires that every factory must be kept clean and free from
effluents flowing from any drain, that a sufficient supply of wholesome drinking water
must be made available at suitable and convenient points and separate latrines and urinals
for male and female workers be provided and spittoons and washing facilities be provided .

 Rest facilities

 This amenity prescribes a prescribed number of seats on the shop floor and in rest
rooms or shelters in order to reduce fatigue as it enables a worker to take a break. Further
the act also makes provisions for lunch rooms to be provided if there are more than 150
workers and these places be clean, well-lighted and ventilated and provided with adequate
furniture and drinking water wherever necessary.

 Feeding facilities

 Every factory employing 150 or more workers should provide a lunch room with
provision for drinking water to enable workers to eat the meals brought by them and
where over 250 or more workers are employed, there should be a canteen or canteens.

 In fulfilling the objectives of an industrial canteen, several points like the following
should be kept in mind.

 It should be managed on a nonprofit basis.

 The canteen has to be roomy, clean, bright and well placed in the factory

 Should have comfortable and friendly atmosphere

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 The food supplied in the canteen should be adequate and of good quality.

The three ways of administering the industrial canteens are

 Directly by the employers

 by a contractor and

 By a co-operative society of workers.

 Medical Facilities

The importance of preventive and curative medical care has increased and it is now
accepted theory that health care for workers will help to reduce the incidence of sickness
and therefore absenteeism among them and will increase productivity.

- The factories act of 1948 provided for cleanliness, disposal of wastes and effluents,
ventilation and temperature control, dust and fume, artificial humidification, restriction
regarding overcrowding, lighting, drinking water arrangements, latrines and urinals and
spittoons etc.,

- Statutory medical facilities were also provided under the Employees State Insurance
Act 1948, with subsequent amendments. This act extends such benefits to industrial
workers as maternity benefits, disablement benefits, dependents‟ benefits, sickness benefits
and medical benefits, while medical care and cash benefits were also provided for workers.

Apart from the medical and health facilities provided by legislation and by some employers
on a voluntary basis, other similar services have been organised by workers by labour
welfare centre and some trade unions.

Statutory & Non-Statutory Welfare Schemes

The statutory welfare schemes include the following provisions –

1. Drinking water

2. Facilities for sitting

3. First aid appliances

4. Latrines & Urinals

5. Canteen facilities

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6. Spittoons

7. Proper Lighting

8. Washing places

9. Changing clothes

10. Rest rooms

The non-statutory welfare schemes include the following provisions –

1. Personal health care – like regular health checkup

2. Flexi-time – flexible time of work for the employees

3. Employee assistance program, like counselling for employee and their family

4. Harassment policy- to protect from the harassment of any kind specific guidelines
are formulated

5. Maternity & adoption leave

6. Mediclaim insurance schemes – for the employee and extended to dependents

7. Employee referral schemes- to encourage employees to refer friends and relatives

for employment in the organization.

The Factories Act, 1948(reference of sections, for details see the Act)

The factories act of 1948 is a milestone in the factory legislation and the main provisions of
the act are as follows -

Provisions regarding safety guarding machines, health and cleanliness, drinking water,
washing and latrine facilities, lunch rooms and restrooms, sitting arrangements, first and
dispensary facilities in all the factories employing more than 500 workmen, crèches were
more than 50 women workers are employed, welfare officer where more than 500 workmen
are employed, provisions for spittoons, holidays with wages at the rate of one day for every
20 days worked, weekly hours like 48 hours for adults and 27 hours for younger persons,

Ashok Mammen V Assistant professor

rate of payment for overtime work, rest for half an hour after maximum 05 hours of work
and weekly holiday.

The act provided for development of labour welfare movement in two streams. One
movement through voluntary effort to develop programmes with a view to minimizing
hardship and the other an agitation movement for better legislation. Thus the government
is playing a triple role of legislator, administrator and promoter.

The Indian constitution makes a specific mention of duties the state owes to labour apart
from the factories act of 1948. The government of India also passed the welfare act known
as employees state insurance act, which provides for benefits to workers in case of sickness,
maternity, employment injury, hospitalization etc.,

CHAPTER III - HEALTH

11. Cleanliness.

12. Disposal of wastes and effluents.

13. Ventilation and temperature.

14. Dust and fume.

15. Artificial humidification.

16. Overcrowding.

17. Lighting.

18. Drinking water.

19. Latrines and urinals.

20. Spittoons.

CHAPTER IV - SAFETY

21. Fencing of machinery.

Ashok Mammen V Assistant professor

22. Work on or near machinery in motion.

23. Employment of young persons on dangerous machines.

24. Striking gear and devices for cutting off power.

25. Self-acting machines.

26. Casing of new machinery.

27. Prohibition of employment of women and children near cotton-openers.

28. Hoists and lifts.

29. Lifting machines, chains, ropes and lifting tackles.

30. Revolving machinery.

31. Pressure plant.

32. Floors, stairs and means of access.

33. Pits, sumps openings in floors, etc.

34. Excessive weights.

35. Protection of eyes.

36. Precautions against dangerous fumes, gases, etc.

36A. Precautions regarding the use of portable electric light.

37. Explosive or inflammable dust, gas, etc.

38. Precautions in case of fire.

39. Power to require specifications of defective parts or tests of stability.

40. Safety of buildings and machinery.

40A. Maintenance of buildings.

40B. Safety officers.

41. Power to make rules to supplement this Chapter.

CHAPTER IVA

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PROVISIONS RELATING TO HAZARDOUS PROCESSES

41A. Constitution of Site Appraisal Committee.

41B. Compulsory disclosure of information by the occupier.

41C. Specific responsibility of the occupier in relation to hazardous processes.

41D. Power of Central Government to appoint Inquiry Committee.

41E. Emergency standards.

41F. Permissible limits of exposure of chemical and toxic substances.

41G. Workers‟ participation in safety management.

41H. Right of workers to warn about imminent danger.

CHAPTER V

WELFARE

42. Washing facilities.

43. Facilities for storing and drying clothing.

44. Facilities for sitting.

45. First-aid appliances.

46. Canteens.

47. Shelters, rest rooms and lunch rooms.

48. Creches.

49. Welfare officers.

50. Power to make rules to supplement this Chapter.

CHAPTER VI

WORKING HOURS OF ADULTS

Ashok Mammen V Assistant professor

51. Weekly hours.

52. Weekly holidays.

53. Compensatory holidays.

54. Daily hours.

55. Intervals for rest.

56. Spread over.

57. Night shifts.

58. Prohibition of overlapping shifts.

59. Extra wages for overtime.

60. Restriction on double employment.

61. Notice of periods of work for adults.

62. Register of adult workers.

63. Hours of work to correspond with notice under section 61 and register under section 62.

64. Power to make exempting rules.

65. Power to make exempting orders.

66. Further restrictions on employment of women.

CHAPTER VII

EMPLOYMENT OF YOUNG PERSONS

67. Prohibition of employment of young children.

68. Non-adult workers to carry tokens.

69. Certificates of fitness.

70. Effect of certificate of fitness granted to adolescent.

71. Working hours for children.

72. Notice of periods of work for children.

73. Register of child workers.

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74. Hours of work to correspond with notice under section 72 and register under section 73.

75. Power to require medical examination.

76. Power to make rules.

77. Certain other provisions of law not barred.

CHAPTER VIII

ANNUAL LEAVE WITH WAGES

SECTIONS

78. Application of Chapter.

79. Annual leave with wages.

80. Wages during leave period.

81. Payment in advance in certain cases.

82. Mode of recovery of unpaid wages.

83. Power to make rules.

84. Power to exempt factories.

CHAPTER IX

SPECIAL PROVISIONS

85. Power to apply the Act to certain premises.

86. Power to exempt public institutions.

87. Dangerous operations.

87A. Power to prohibit employment on account of serious hazard.

88. Notice of certain accidents.

88A. Notice of certain dangerous occurrences.

89. Notice of certain diseases.

Ashok Mammen V Assistant professor

90. Power to direct enquiry into cases of accident or disease.

91. Power to take samples.

91A. Safety and occupational health surveys.

CHAPTER X

PENALTIES AND PROCEDURE

92. General penalty for offences.

93. Liability of owner of premises in certain circumstances.

94. Enhanced penalty after previous conviction.

95. Penalty for obstructing Inspector.

96. Penalty for wrongfully disclosing results of analysis under section 91.

96A. Penalty for contravention of the provisions of sections 41B, 41C and 41H.

97. Offences by workers.

98. Penalty for using false certificate of fitness.

99. Penalty for permitting double employment of child.

100. [Repealed.]

101. Exemption of occupier or manager from liability in certain cases.

102. Power of Court to make orders.

103. Presumption as to employment.

104. Onus as to age.

SECTIONS

104A. Onus of proving limits of what is practicable, etc.

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105. Cognizance of offences.

106. Limitation of prosecutions.

106A. Jurisdiction of a court for entertaining proceedings, etc., for offence.

Labour Welfare Officer? Discuss The Duties And Function Of Labour Welfare Officer.

Labour welfare officer - The Indian Factories Act 1948, made it obligatory on the part of
the employers to appoint welfare officers to look after the labour welfare activities in the
factories where there are 500 or more than 500 workers are employed. Thus the
appointment of labour welfare officer is statutory requirement. His work with human
resources officers to solve the labour related problems.

The various role of the labour officer can be summarised as (1) the Supervisory role (2)
the Advisory role (3) the Liaisoning role (4) the Counselling role

Duties and function of labour officer –

1. To encourage the formation of workers and joint production committees, co –

operative societies and safety and welfare committees and supervise their works.

2. To advise and assist the management in the fulfillment of obligations, statutory or

otherwise, concerning the application of provisions of the Factories Act of 1948and rules
made there under and to establish liaison with the factory inspector and the medical
services concerning medical examination of employees, records supervision of hazardous
jobs, visiting the sick and convalescence, accident prevention and supervision of safety
committees, safety education and investigation of accidents.

3. To encourage the formation of workers and joint production committees,

cooperative societies and safety and welfare committees and supervise their work.

4. To promote relations between management and workers which will ensure

productive efficiency as well as ameliorate the working conditions and to help workers to
adjust and adapt themselves to their working environment.

5. To establish contacts and hold consultations with a view to maintaining harmonious

relations between the management and workers.

Ashok Mammen V Assistant professor

6. To advise and assist management in the provision of amenities such as canteen,
shelters for rest, crèches, adequate latrine facilities, drinking water , sickness and
benevolent scheme payment , pensions and super annuation funds and gratuity payments.

7. To bring to the notice of workers their rights and liabilities under the standing
orders of the establishment and other rules which grant rights to and define the duties of
workers or which are directed to the discipline safety and protection of workers and
establishment

8. To advise assist the management in providing welfare facilities such as housing

facilities, food, social and recreational facilities, sanitation, education of children and advise
on individual personal problems.

9. To suggest measures which will serve to raise that standard of living of workers and
in general promote wellbeing.

10. To bring to the notice of the management the grievances of workers, individual as
well as collective with a view to securing their expeditious redress.

11. To advise workers against going on illegal strikes and the management against
declaring illegal lock – outs and to help in preventing antisocial activities.

12. To study and understand the point of view of labour in order to help the
management to shape and formulate labour policies and interpret their policies to the
workers in language they can understand.

13. To help the management in regulating the grant of leave with wages and explain to
the workers in the matter submission of application for grant of leave for regulating
authorised absence.

14. To maintain an impartial attitude during illegal strikes lock outs and help to bring
about a peaceful statement.

Various Agencies For Labour Welfare Work In India.

Agencies for labour welfare work in India – The following agencies work for the labour
welfare in India are

1. The Central government

2. The State government

3. The Employers

4. The Trade Unions

5. Other Agencies

Ashok Mammen V Assistant professor

• Directorate General of mines safety – The director general of mines safety enforces
the mines act, 1952. He inspects electrical installation and machinery provided in the mines
in order to prevent spread of fire and danger of inundation. He also investigates accidents
and conducts industrial hygiene surveys. He is entrusted with the power of prosecution in
case of violation of statutory provisions.

• National safety council – The national safety council was set up on 4th March, 1966
in Bombay at the initiative of the Union Ministry of Labour and Rehabilitation, govt, of
India as an autonomous national body with the objective of generating developing and a
movement of safety awareness at the national level. The affairs of the council are managed
by a board of Government which has 5 members besides the chairman who is nominated
by the Govt. of India. The Director General who is also the secretary of the board of
governors is the chief executive of the council

Following are the main activities of this council:

1. It lends films to its corporate members for being screened to their employees for
creating safety awareness.

2. It organizes conference, seminars and symposia on different topics related to

occupational safety and health both at the national and international level.

3. It provides information cum technical advice to its members on specific problems of

safety and health referred by them

4. It maintains liaison with international agency like I.L.O, W.H.O, the British safety
council etc,

5. It organizes national safety competition (essay, poster and slogan) every year to
encourage creative thinking at gross root level.

6. It brings out a quarterly journal „Industrial safety chronicle‟ and a monthly

newsletter, „Industrial safety news‟ it also brings out every year other type of publicity
material to propagate safety consciousness.

7. It conducts both need based and specialized training programmes for all types of
industries.

8. It undertakes safety audits, surveys and studies of the industrial plants on specific
request from its member.

• Central Labour Institute – The institute was set up in Bombay in 1966 to facilitate
the proper implementation of the factories act, 1948, to provide a centre of information for
Ashok Mammen V Assistant professor
inspectors, employers, workers and other concerned with the wellbeing of industrial labour
and to stimulate interest in the application of principles of industrial safety, health and
welfare. Regional labour institutes have been set up in Calcutta, Madras and Kanpur in
order to give the control labour institute adequate field support.

Ashok Mammen V Assistant professor

 EWSS - UNIT 3
Social security - Definition, Features
The Indian Social Security System
Various Approaches Of Social Security
The Importance Of Social Security
The Scope Of Social Security In India
Various Labor Laws Relating To The Social Security.
Three Major Ways Of Providing Social Security - Social Insurance, Social
Assistance, Public Service
Major enactments made by GoI for Industrial workers
Acts – ESI, EPF, Maternity, Industrial Dispute, Employer‟s Family
Pension Scheme, Payment of Gratuity
Additional notes& discussions
Q&A

Social Security

The concept of social security has been mentioned in the early Vedic hymn which wishes
everyone to be happy free from ill health and enjoy bright future and suffer no sorrow. Itaims in
providing protection, progress, and social transformation.

The concept of social security is that the state shall be responsible forprotecting its citizens against
certain contingencies of life. The basic principle of social security implies collective action by
thecommunity to help a member against misfortunes and wants he cannot meet with his ownresources.
It is based on business ethics “ideals of human dignity and social justice”.Social security is the security
that society furnishes through appropriate organizations againstcertain risks to which its members are
exposed. Broadly speaking the idea of social security isthat “The state shall make itself responsible for
ensuring a minimum standard of material welfareto all its citizen on a basis wide enough to cover all
contingencies of life from womb to the tomb.

According to ILO “Social security is the protection which society provides for its membersthrough a
series of public measures against the economic and social distress resulting fromsickness, maternity,
employment injury, unemployment, invalidity, old age and death. Thesemeasures are also of a great
importance to a country which is on the way of large scaleindustrialization as they improve employee’s
morale by providing sense of security to themagain various industrial hazards.”

DEFINITION:
Social security is defined as “the security that society furnishes, through appropriate
organisation, against certain risks to which its members are exposed” These risks are essentially
contingencies against which the individual, who has small means, cannot protect himself. These
contingencies include employment injury, sickness, invalidism or disablement, industrial disease,
maternity, old age, burial, widow hood, orphan hood and unemployment.

Ashok Mammen V Assistant professor

 Thus Article 41 of the Constitution of India says that “The state shall within the limits of its
economic capacity and development, make effective provision for securing the right towork, to
education and to public assistance in cases of unemployment, old age, sickness and disablement
and in other cases of undeserved want.”

Thus, the social security measures would help man to face the contingencies as such it is difficult
for him either to work or to get work and support himself and his family. Thus social security
measure provides a self-balancing social insurance or assistance from public funds.

THE FEATURES OF SOCIAL SECURITY

Social security provides financial helps in case of contingencies such as
unemployment,maternity, industrial disease, old age and death etc. The following are the features
ofsocial security -
i. Social security in some countries is applied to all governmental programmes and in some
countries it is applied only to Social Insurance programme.
ii. It covers wide variety of health and welfare schemes, the coverage of social security is very
wide meeting the different contingencies of an employee member.
iii. Social Security is a dynamic concept and its coverage changes with social, economic and
political system prevailing in a given country at a given time.
iv. A comprehensive scheme of social security consist of “Social Insurance and social
assistance".
v. The modern social security scheme is the integration of its two important elements of social
insurance and social assistance and covering of all social risks.
vi. Social security must provide protection against all the ordinary risks of life and as well as
special risks of employment.
vii. It should bring under protection all the member workers who live solely by their mere
earnings.
viii. All social security programme although differ from country to country but they aims at
providing some form of cash payments to individuals to individuals to replace at least a part
of the lost income that occurred due to any such contingencies.
ix. It provides financial helps in case of contingencies such as unemployment, maternity, work
injury, industrial disease, old age, widowhood and orphan hood etc.
x. Under social security the members of a particular category are offered safeguards and
benefits such as medical and financial and to injured and financial help to widows, orphans
and educational assistance in the form of scholarship and free

INDIAN SOCIAL SECURITY SYSTEM

In India, the social security system was in a crude form of social protection that was made
available to the needy and the unfortunate under the joint family system, while additional help
was rendered by the community panchayats, orphanages and widows home and also by
individuals offering alms and [Link] the joint family system problems like unemployment
or any other economic hardships, old age and other contingencies were not suffered by the
individuals, since there were not in isolation. Similarly members of a particular cast were offered
security and benefits such as medical aid, financial help to widows and orphans, educational
assistance in the form of scholarships and freeships were offered. However these assistance were

Ashok Mammen V Assistant professor

 offered only to the members of their community and there was no definite law or principle
towards these.

During the time of urbanization and industrialization both these systems of social security system
lost its hold on the society and the concept of secular state in India has further eroded the
continuance of the [Link] industrialization has created anew class of industrial portrait
of the country with its rural background and with very little social and material resources, is in
great need of systematized help through social security agencies. The social security system in
India has evolved in obedience to the impact of western influence and of the modern urban
industrial [Link] social reformers, labour welfare organisations and many progressive
employers persuaded the government to undertake social security measures as a protection for
the workers at least against a few contingencies. Social security is a major aspect of public policy
today and the extent of its prevalence is a measure of the progress made by a country towards the
idea of a welfare state.

VARIOUS APPROACHES OF SOCIAL SECURITY

Broadly speaking the approaches of social security are three fold in nature:

i. Compensation means income security during spell of risks because the individual and his
family not be subjected to a double calamity involving both destitution and loss of life, health
and work. Under worker compensation, workers are compensated in case of any permanent
disability reducing permanently or temporary earning capacity of aggrieved employee. It is
compensating a suffered employees due to contingencies and unexpected mishaps by
providing financial support.

ii. Restoration. It means giving individuals and their families the confidence that their level of
living and quality of life will not suffer as far as possible due to any social and economic
loss. “It aims at restoring the previous social and economic status of the employee by
providing financial and social help under different provisions of social security Acts. Due to
restoration of one‟s previous status financial position the self- confidence and self-esteem of
the employee can be maintained.” Restoration mean reemployment and providing self-
confidence through cure of sick/injured employees.

iii. Prevention. Social Security is a basic instrument of social and economic justice among
members of the society.” It not only aims at compensation and restoration of one‟s financial
and social status; it further aims prevention of mishaps, industrial injury and occupational
diseases. Prevention aims at avoiding loss of productive capacity due to sickness i/injure or
Unemployment. Factory Act, Industrial safety Act and worker‟s Compensation Act are
helpful in the preventions of different Industrial hazards leading to injury and occupational
diseases. Prevention is better than cure.”

THE IMPORTANCE OF SOCIAL SECURITY

Social security is of great importance to developing and underdeveloped countries whichaims at

large scale rapid industrialization. It helps in improving morale of employees byproviding sense
of security to them against various industrial hazards, occupational diseases andany other types
of unfair [Link] are some of the important objectives of social security

Ashok Mammen V Assistant professor

 (i) Access to social security is a fundamental human right to which every individual is entitled
as a member of the society.
(ii) Its main objective is to give individual that confidence through which they must be sure
that their level of living and quality of life will be adversely affected due to any mishaps
and contingencies.
(iii) The aim of social security has been widened to include the complete quality of working and
living life in each aspect.
(iv) Society security is a wise investment which motive the employees and boost their morale.
(v) It is basic instrument of social and economic justice among members of the society.
(vi) Social security leads to adoption of the schemes of unemployment, insurance and creation
of new employment through a drive for rational planning and industrial development.
(vii) It further aims at the establishment of a scheme of old age and unemployment pension.
(viii) Social Security emphasis covering more different types of risks like sickness, maturity and
employment injuries.
(ix) Under Social security cash benefits were to be given for employment injuries for
permanent partial incapacity.
(x) The main objective of social security is that a citizen who has contributed or is likely to
contribute to his country‟s welfare should be given protection against certain hazards of
life. It emphasizes and ensures that the ideals of human dignity and social justice are duty
taken care.
(xi) The main objective of social security is that a citizen to his country‟s welfare should be
givenprotection against certain hazards of life.

THE SCOPE OF SOCIAL SECURITY IN INDIA

ILO (International Labour organization) in its convention divided scope of social security into nine
components.

(i) Medical care, social security under medical care covers pregnancy confinement and its
consequences and disease which lead to a morbid condition. “The need for pre-natal and
postnatal care was emphasized. It may include practitioner care, specialist care, provision of
essential pharmaceutical and hospitalization.”
(ii) Sickness Benefit. Sickness includes incapability to work resulting a loss of earning. Under
this benefit worker need not be paid for three days of suspension of earnings and the
payment of benefits may be limited to 26 weeks in a year.
(iii) Unemployment Benefit. Under the social security benefit cover the loss of earning during a
worker‟s unemployed period when he is capable and available for work but remains
unemployed because of lack of suitable employment. As per Act this benefit may be limited
to 13 weeks payment in year.
(iv) Employment Injury Benefit. Under Employment Injury benefit proper medical care and
periodical payment are made to injured employee as per the legal provisions of Worker‟s
compensation Act. In these days industrial work is subject to different kind of contingencies
mishaps and occupational diseases which are covered under employment injury benefit of
social security.

It may include (i) Morbid condition (ii) Inability to work (iii) Due to Morbid condition may lead
to suspension of earning (iv) Total or partial loss of earning capacity. (v) Death of the bread

Ashok Mammen V Assistant professor

earner in family. Under this proper medical car and periodical payment are made to injured
employee as per the legal provisions of Worker‟s compensation Act.

(v) Old Age Benefit. Old age benefits is applicable in India only in few states. Under this
benefitthe quantum of payment depends upon on individuals working capacity during the
period [Link] further includes a certain amount beyond a prescribed age and
continues till one‟sdeath.
(vi) Maternity Benefit. There is complex maternity benefit Act 1961 which covers benefit
dueto pregnancy. Confinement and their consequences resulting in the suspension of
earnings. Thereis legal provision for medical including pre-natal confident, post-natal
care and alsohospitalization if required. Fixed periodical payment of three month before
birth of the child andthree month after that.
(vii) Family Benefit. In case of death of the bread earner this cover responsibility
formaintenance of children during the entire period of children is provided.
(viii) Survivor‟s benefit. It refers to the benefits to the affected family in form of
periodicalpayments to a family following the death of its bread earner and should
continue during theentire period of contingency.
(ix) Invalidism benefit. In fact this benefit continue till invalidism changes into old age then
oldage benefit would become payable under this benefit as per ILO convention “ a
periodicalpayment should cover the needs of workers who suffer from any disability
arising out of sicknessor accident and who are unable to engage into any gainful
activity.”

VARIOUS LABOR LAWS RELATING TO THE SOCIAL SECURITY.

There are several legislative acts that are providing social security to workers in [Link]
legislations provide social security to workers from each and every contingencies likerisks and
mishaps which they are exposed to:

(i) “Employee‟s provident fund and Miscellaneous provision 1952: It emphasis on

employee‟s pension and family pension.
(ii) Payment of gratuity Act 1972. It provides reward for providing a decent and long
service of an employee towards his organization.
(iii) Workmen‟s Compensation Act 1923. It aims to provide medical care. Periodical
payment during sickness and industrial accident/ occupational diseases to which a
worker is expected to while on the job.
(iv) Employee‟s State Insurance Act. The Act provides insurance to employee‟s at a highly
economical premium and providing all types of insurance coverage for meeting different
contingencies during his life and giving a handsome amounts after death to the family
members.
(v) Maturity Benefit Act. It covers pregnancy, confinement their consequences and medical
care before and after delivery of the child.
(vi) Group Insurance. Employees are given life insurance policies at very nominal premium
as compared to individual insurance.
(vii) Payment of Wages Act 1936. Ensures timely right salary after permissible deduction to
the employees.
(viii) The Minimum wages Act 1948--- It safeguard the workers to get minimum wages from
their respective employers at the prevailing price index.

Ashok Mammen V Assistant professor

 (ix) The Factories Act 1948: It is wide act which provide security to workers against health,
cleanliness, safety good working condition and employment of women and children.

Besides these important Acts social security is being provided to different segment of
employeesby these sub acts like.

a) Coal Mines Provident and Bonus scheme Act 1948.

b) The plantation labour Act 1951.
c) Assam Tea Plantation Provident Act 1955.
d) Personnel Injuries (Compensation Insurance) Act , 1963
e) Seamen‟s Provident Act 1968.

THREE MAJOR WAYS OF PROVIDING SOCIAL SECURITY ARE

1. Social Insurance – is described as the giving in return for contribution, benefits up to

subsistence level, as of right and without a means test, so that an individual may build freely
upon it.

The features of social insurance are –

a) It is financed entirely by or mainly from the common monetary contributions of workers,
employers and the state. This fund takes care of all the benefits paid in cash or kind.
b) The state and the employers make a major contribution to the fund, while the employees pay
only a nominal amount, according to their capacity to pay.
c) Under these schemes contributions are accumulated in special funds out of which benefits
are paid.
d) Under social Insurance schemes benefits are so planned to cover on a compulsory bases all
those who should be covered.
e) When there is a total or partial loss income, these benefits within limits, ensure the
maintenance of the beneficiaries minimum standard of living.
f) Social insurance benefits are granted without an examination of an individual‟s needs and
without any means test, without affecting the sense of self respect of the beneficiary.
g) These benefits are so planned as to cover, on compulsory basis all those who are sought to be
covered.
h) Lastly, social insurance reduces the suffering arising out of the contingencies faced by an
individual contingency which he cannot prevent.

Scope Of Social Insurance - The scope of social insurance is very wide covering
i. Worker state insurance schemes 1948.
ii. Maternity benefits act, 1961.
iii. Coal Mines provident fund and bonus schemes 1948.
iv. Seamen‟s provident Fund Act 1966.
v. Medical schemes and Facilities under their central and state govt employees who make monthly
contribution to the Health schemes.
vi. The Indian Railway too runs hospital and dispensaries for the employees and their family.

Ashok Mammen V Assistant professor

 2. Social Assistance – is provided as a supplement to social insurance for those needy persons
who cannot get social insurance payments and is offered after a means test. The general
revenues of the government provide the finance for social assistance payments, which is
made available as a legal right to those workers who fulfill given conditions. Social
assistance and social insurance go side by side. Social assistance programmes cover such
programmes as unemployment assistance, old age assistance, public assistance and national
assistance. Thus social security is a combination of the principle of social assistance and
social insurance. Social insurance however falls in midway between the two for it is financed
by the state as well as by the insured and their employers, whereas social assistance is given
grants to the needy by the state or the community. Commercial insurance is entirely a private
contract.

The following are the features of social assistance

i. Social assistance is a kind of help which depends upon certain conditions and legalities
between workers and the state.
ii. Social assistance is given as voluntary help while social insurance is granted only persons
who pay a contributions.
iii. The social assistance has an objective to cover poor sections of people in the society who
cannot effectively protect themselves from risks and contingencies.
iv. Social assistance is the unilateral obligation of the community towards members who are
really in need.
v. Social assistance is an expression of social responsibility of state towards its needy person.
vi. Social assistance is financed wholly or for a very large measures from the general revenues
of the state.
vii. Social assistance does not provide any legal obligation to its members to give
monthlycontributions towards its schemes for getting the benefits.
viii. In all schemes of social assistance like social insurance there is no relationship of any sort
in risks and premiums paid.
ix. Social assistance schemes are more applicable where the workers are too poor to
contribute, too illiterate to follow the formalities of insurance.
x. Social assistance requires the fulfillment of certain prescribed conditions before the benefit
can be granted under such scheme.

3. Public Service –is a programme constituting the third main type of social security. They are
financed directly by the government from its general revenues in form of cash payments or
services to every member of the community falling within a defined category. Some of the
services being rendered under this scheme is - national health service providing medical care
for every person in the country, old age pension, pension for invalidism, survivors pension to
every widow or orphan and a family allowance to every family having a given number of
children. Apart for the state, there are many other agencies which provide security against
contingencies.

In many other countries, the trade unions have their own sickness, old age and unemployment
schemes. Savings funds, sickness benefits and old age pensions have also be been provided by a
large number of Organizations for their employees. “The underlying idea of social security
measures is that a citizen who has contributed or is likely to contribute to his country‟s welfare
should be given protection against certain hazards.”
Ashok Mammen V Assistant professor
MAJOR ENACTMENTS BY THE GOVERNMENT OF INDIA

The following major enactments have been made by the Government of India to provide social
security to industrial workers.

Workmen‟s Compensation Act 1923 – was put into effect on 1st July 1924 and was amended
several times. It was extended and enforced by the Indian Independence Order of 1948 and
adaptation of laws order in 1958, war time injuries were also covered by the act.

Employees State Insurance Act 1948 – The Government of India could not adopt the health
insurance schemes due to financial difficulties and hence after several conferences, the health
insurance for the workers was recommended as compulsory and contributory in August 1944 and
the Employees State Insurance Act was enacted in the year 1948 that would cover the cash
benefit in contingencies of sickness, maternity and employment injury but did not provide
security in such contingencies as unemployment and old age. The ESI schemes offer both direct
and indirect medical care. The direct method is called the service system by which the ESI
Corporation provides medical care either through its own employee‟s state insurance hospital or
through reservation of beds in state government hospitals. The indirect method is known as panel
method under which medical care is provided through private doctors selected by the state
government with the approval of the ESI Corporation that would cover
- Sickness benefit
- Maternity Benefit
- Disablement Benefit
- Dependants Benefit
- Funeral Benefit and Medical benefit

Employees Provident Fund Act, 1952- EPF Act applied to all factories mines and other coal
mines and commercial establishments employing more than 20 workers and their earning not
exceeding Rs. 3,500/-. The Act was amended following which the employee‟s family pension
scheme has been enforced from 1/3/1971 with a view to protect the family after the workers
[Link] 2014 the wage ceiling was enhanced to Rs. 15,000/- from Rs. 3,500/-.

Maternity Benefit Act 1961 – following the enactment, it provided for better and more far
reaching benefits and hence the state act of maternity benefit that were enacted earlier lost its
importance and gradually the central act was adopted.

Industrial Dispute Act 1947 - was the act that provides for workers unemployment due to
layoff. This relief was given by way of compensation to the affected workers at a certain
specified rates. The compensation in case of retrenchment cases amounts to 15 days average
earnings for every completed year of service or part thereof. In the event of closure of
undertaking, the retrenched workers receive compensation at the same rate, however it is limited
to a maximum of three months average earnings.

Employer‟s Family Pension Scheme 1971 – was notified by the Government of India under the
employee‟s provident fund and family pension act. Here the family pension means a regular
monthly amount payable to a person belonging to the family of a member of the pension fund
scheme in the event of his death during the period of reckonable service. The definition of the
word, family covers wife or husband, minor sons, and un married daughters of a member of the
family pension fund.

Ashok Mammen V Assistant professor

Payment of Gratuity Act 1972 – according to the act, gratuity shall be payable to an employee
on termination of his employment after he has rendered continuous service for not less than five
years.
- On his superannuation
- On his retirement or resignation
- On his death or disablement due to accident or disease

Additional notes
What is Social Security?

• any of the measures established by legislation to maintain individual or family income or to

provide income when some or all sources of income are disrupted or terminated or when
exceptionally heavy expenditures have to be incurred (e.g., in bringing up children or paying for
health care)
• social security may provide cash benefits to persons faced with sickness and disability,
unemployment, crop failure, loss of the marital partner, maternity, responsibility for the care of
young children, or retirement from work
• Social security benefits may be provided in cash or kind for medical need, rehabilitation,
domestic help during illness at home, legal aid, or funeral expenses
• It acts as a facilitator – it helps people to plan their own future through insurance and assistance.

History of Social security

• Germany was the first country to introduce Social security scheme (1883)
• each member of a particular trade (blacksmiths, painters, weavers etc) was required to
contribute at regular intervals;
• Money from this fund was used for food,lodging, hospital and feneral expenses of aged and
disabled members.
• In USA, Social Security Act came into existence in 1935.

Social Security in India

• India has always had a Joint Family system that took care of the social security needs.
• However with rise of migration, urbanization, nuclear families and demographic changes, Joint
family system has declined. Hence we need a formal system of social security.

Social Security: Constitutional Provisions

Concurrent List - Social Security and labour welfare falls under Concurrent list, it means both union and
state Government can make laws regarding these topics.

- (List III in the Seventh Schedule of the Constitution of India)

- Item No. 23
o Social Security and insurance,
o Employment and unemployment.
- Item No. 24
- Welfare of Labour including conditions of work,
- provident funds,
- employers’ liability,

Ashok Mammen V Assistant professor

 - workmen’s compensation,
- invalidity and old age pension and maternity benefits.

Part IV Directive Principles of State Policy

Article 41

• Right to work, to education and to public assistance in certain cases

• State shall, within the limits of its economic capacity and development, make effective provision
for securing the right to work, to education and to public assistance in cases of unemployment,
old age, sickness and disablement, and in other cases of undeserved want.

Article 42

• Provision for just and humane conditions of work and maternity relief
• State shall make provision for securing just and humane conditions of work and for maternity
relief.

Difference between Organized and Unorganized Sectors

Organized sector

• includes primarily those establishments which are covered by the Factories Act, 1948, the Shops
and Commercial Establishments Acts of State Governments, the Industrial Employment Standing
Orders Act, 1946 etc.
• This sector already has social security benefits under above laws.
• Examples: employees of union and state Government, army, navy, airforce, Multinational
companies, Infosys, TCS and so on.

Unorganized sector

Examples of Unorganized sector

Rural Areas Urban Areas

1. landless agricultural labourers 1. street vendors

2. small and marginal farmers 2. hawkers
3. share croppers 3. head load workers
4. persons engaged in 4. cobblers
a. animal husbandry 5. tin smiths
b. fishing 6. garment makers
c. horticulture 7. 7. Construction workers
d. bee-keeping
e. toddy tapping
5. forest workers
6. rural artisans
• Unorganized sector doesn’t have labour law coverage. These are seasonal and temporary nature
of occupations.
• Casual nature of work, labour mobility is high hence bargaining power is low.

SOCIAL SECURITY LAWS In India

Ashok Mammen V Assistant professor

1. Employees’ State Insurance Act, 1948 (ESI Act)
• covers factories and establishments with 10 or more employees
• Provides medical care to employees and their families.
2. Provides Cash benefits during sickness and maternity
• Monthly pension after death or permanent disability.
3. Employees’ Provident Funds Act, 1952
• applies to specific scheduled factories and establishments employing 20 or more employees and
ensures terminal benefits to provident fund, superannuation pension, and family pension in case
of death during service.
4. Workmen’s Compensation Act, 1923 (WC Act)
• Requires payment of compensation to the workman or his family in cases of employment related
injuries resulting in death or disability.
5. Maternity Benefit Act, 1961 (M.B. Act)
• provides for 12 weeks wages during maternity as well as paid leave in certain other related
contingencies.
6. Payment of Gratuity Act, 1972 (P.G. Act)
• provides 15 days wages for each year of service to employees who have worked for five years or
more in establishments having a minimum of 10 workers.

Social Security in India: Different From Developed Nations

• We do not have an existing universal social security system

• 92% of the workforce is in the informal sector which is largely unrecorded
• Today 1/8th of the world’s older people live in India. The overwhelming majority of these depend
on transfers from their children.
• Addressing social security concerns with particular reference to retirement income for worker
• In India the coverage gap i.e. workers who do not have access to any formal scheme for old-age
income provisioning constitute about 92% of the estimated workforce of 400 million people.

Provident Fund

• Here the employers to contribute to a provident scheme providing a lump-sum payment in the
event of death or disability or on retirement.

3 disadvantages of Provident Fund

1. Money is inadequate for risks occurring early in working life.

• Provident funds are generally invested in government securities, which have very low interest
rate (~8%) compared to other investment options such as mutual fund or even Bank fixed
deposits

3. Inflation erodes the real value of savings.

But From the point of view of government, Provident Fund is attractive because it generates forced
savings that can be used to finance national development plans.

Q & A - SOCIAL SECURITY

Ashok Mammen V Assistant professor

1. What do you understand by social security? What are its characteristics? Discuss the
elements covered under social security?ORDefine social security. Discuss its essential
elements.

Social Security – People with limited means of living can hardly provide effective security against the
contingencies like sickness, maternity, invalidity, employment injuries, unemployment, old age, death and
other emergency expenses. This is basically due to the fact that they do don‟t have the capacity or the
foresight to carry out a plan of saving or insurance. These contingencies impaired the ability of the
workers to support themselves and their dependents.

Broadly speaking, the idea of social security is that “the state shall make itself responsible for ensuring a
minimum standard of material welfare to all its citizens on a basis wide enough to cover all the
contingencies of life” from the womb to tomb. It envisages that the member of a community shall be
protected by the collective actions against social risks, causing undue hardship to individuals whose
private resources can seldom be adequate to meet them. It covers through and appreciates
organizations, certain risk to which a person is exposed. The underlying philosophy behind social security
is thus, to protect an individual who contributes or is likely to contribute to social welfare. The hazards that
necessitate protection of individual by the society are essentially economic, but at times they may even
be social. These risks to which an individual in society is exposed are caused by physical (sickness,
invalidity, old age, maternity accident and death) and economic (technological change and burden of
large families) factors. Both physical and economic risks deprive an individual of his earning power. It is
the social security that is designed to eliminate five giants viz., want, disease, ignorance, squalor and
idleness.

Lord Beviridge -“ Social security as a controversial and dynamic subject with various facets –
philosophical, theoretical, humanitarian, financial, administrative, social, economic, political, statistical,
actuarial, medical and legal.”

Weder& Cohen- “ The security that society furnishes to its member through appropriate organisation
against certain risk to which its member are exposed. The risks are essentially contingencies against
which the individual with small means and meager resources cannot effectively provide by his own ability
or foresight alone, or even in combination with his fellows these risks being sickness, maternity, invalidity,
old age and death”

I.L.O - “ Social security as a programme of protection provided by the society against the contingencies of
modern life in such as sickness, unemployment, old age dependency, accident and invalidism against
which the individual cannot be expected to protect himself and his family by his own ability or foresight”

Friendlander, Walter A - “Social security is the endevour of the community, as whole to afford itself to the
at most extent possible to any individual during periods of physical distress inevitable on illness or injury
and from the economic distress consequent on reduction or loss earnings due to illness disablement
maternity, unemployment, old age or death of the working member”

Ibid - “Social security as the measure to secure an income to take place of earnings when they are
interrupted by unemployment sickness or accidents, to provide for retirement through old age, to provide
against loss of support by death of another person and to meet exceptional expenditure connected with
birth, death and marriage. The purpose of social security is to provide income up to a minimum and also
medical treatment to bring the interruption or earnings to an end as soon as possible.”

In short, social security is the protection of the worker against sickness, diseases and injury, arising out of
his employment, the protection of children, young persons and women provisions for old age & injury.

Features
1) The benefit or services are provided in three major wages: Social insurance, social assistance and
public services.
2) They are established by laws.

Ashok Mammen V Assistant professor

3) They provide some form of cash payment to individual to replace at least a part of the lost income
that occurs due to such contingencies as unemployment, work injury invalidism, maternity, sickness
and death

Elements covered under social security – These include

1) Payment of funeral expenses
2) Medical care in all times of illness.
3) Pension in old age after retirement.
4) Allowance during the period of unemployment etc.
5) Maternity facilities and cash allowances before and after the birth of child in case of female
6) Pension during invalidity.

Aims of Social Security

1) Prevention
2) Restoration
3) Compensation

1. Prevention – is designed to avoid loss of productive capacity due to sickness, unemployment or

invalidity and to render the available resources which are used up by avoidable diseases and
idleness and thus increases the material intellectual and morale well being of community.
2. Restoration – Restoration implies cure of the sick and invalid re – employment and rehabilitation, and
is in some ways, an extension of the earlier concepts of the functions of social security.
3. Compensation – Compensation goes to income security and is based upon the idea that during spell
of risks, the individual and his family should not be subjected to a double calamity involving both
destitution and loss of health, limb, life or work.

Coverage of social security measures

Social security measure covers a wide range of activities. “While in most of the countries, all
governmental programmes planned to maintain income are called social security [Link] are
two main currents in the movement towards social security, viz.,
a. Social assistance
b. Social insurance
These two differ in their revolutionary process and approach: they have being designed to serve some
ends, and both are complementary and supplementary to each other. Theyare two sides of the same coin
and form an integral part of social security system of a country.

2. Write brief note on the followings:

a. Social insurance
b. Social assistance or public assistance

a. Social insurance - Social insurance is the method to help individual in times of contingencies
through group efforts. Social insurance is a cooperative device which aims at granting adequate
benefits to the workers compulsory basis, in times of unemployment, sickness and other
emergencies, with a view to ensure a minimum standard of living, out of a fund created by the
contributions of workers, employers and the state, William Beneridge described social insurance as
the giving in return for contribution, benefit up to subsistence level, as of right and without means test.

Social insurance is a collective or co – operative method of protecting individual against the chief risk
of life. It is based on the premise that although accidents of life are incalculable in regard to
individuals, they may be foreseen and measured with a fair degree of exactitude in relation to groups
of individuals where they occur with remarkable regularity. This possibility of foretelling events with
regard to groups enable the risks to which individuals are exposed to be spread over large number of
persons. The term is, however, restricted in its application to scheme designed to protect working
classes against various industrial hazards. It is based on compulsory mutual aid and may be traced
back to family relationship under the institution of joint family. It has been the growth of individualism
and influence modern civilization, introduction of factory system and transport revolution that led
towards disintegration of joint family system and thereby giving birth problem of economic security to

Ashok Mammen V Assistant professor

 be served by the community. Social insurance, in its present form, is thus nearer to the mutual benefit
societies of workers which were formed with the purpose of helping one another is misfortunes.

Social insurance scheme need be based on a wide knowledge of social pathology and a study of
causes and effect of common industrial risks, for the incident and severity of risks vary from country
to country, depending on a large number of factors like age, income, having employment and labour
conditions in general. But, it does not mean that there is actuarial relationship between contribution
and benefit conferred on the insured under social insurance scheme. Being quite distinct from the
commercial insurance where benefits are paid according to the amount of contribution, that is
premium based on actual studies, social insurance involves payment of certain benefits to the
persons insured without any consideration of his contributions to the fund set up . No mathematical
relationship between benefit and contribution is maintained under social insurance which does not
envisage any distinction between good risk and bad risk.

b. Social Assistance/Public assistance – Social or national assistance may be defined as a device to

provide benefits conditional upon provided needs at time of calm , irrespective of previous
contribution, but adjusted in each case , and paid out of nationalexchequer”. It represents the
“unilateral obligation of the community towards its dependent groups”. While benefits under social
insurance are granted as a matter of right and without any means test, social assistance is made
available to those who fulfill certain prescribed conditions. It is provision of certain relief by the state
or local bodies to those who are in need of it to meet certain contingencies under „special cases‟.

The term public or social services include benefits in cash as well as the provision of actual services
to certain groups of people who are assumed to need this. No previous contribution is required here
as well. It may be noted here that provision of medical care and children allowances are the notable
instances of social services. It is a matter of aspect of public policy and the extent of its prevalence is
a measure of the progress made by a country towards the ideal of a welfare state.

Public services of assistance are usually financed directly by the government from its general
revenue in the form of cash payments or services to every individual of the community falling with a
defined category. The examples of social assistance of public services programmes are medical and
health services of government, old age pension, unemployment allowances etc.

3. What social security components are being prescribed by International labour

organization?ORWrite a brief note on ILO & social security.

ILO & social security – In 1944, ILO stated that poverty any where constitutes a danger to prosperity
everywhere. On December 10, 1948, the General Assembly of the United Nations adopted and
proclaimed the universal declaration of Human Rights as common standards of achievement for all
nations, the declaration says that:
“Everyone has the right to a standard of living, adequate for health and well being of himself and of his
family including food, clothing, housing and medical care and the right to security in the event of
unemployment sickness, disability, widowhood, old age or other lack of livelihood in circumstances
beyond control.
In order to implement these, the ILO took the following steps
1. It collected and spread the information about social security schemes in various countries.
2. It provides technical assistance and guidance so that social security schemes may be properly
formulated by means of co operation with other organisations.
3. It tried to create international standards by way of recommendations regarding the definition of social
security.

In 1952, ILO convention on social security minimum standard divided social security into nine
components:
a) Sickness benefit
b) Maternity benefit
c) Survivors‟ benefit
d) Family benefit
e) Medical care benefit

Ashok Mammen V Assistant professor

f) Unemployment benefit
g) Employment injury benefit
h) Old age benefit
i) Individualism benefit

a) Sickness benefit – This should cover to work due to a morbid condition resulting in a loss of earnings.
This calls for periodicals payments based on the convention specification. The worker need not be
paid for the first three days of suspension of earnings and the payment of benefit may be limited to 26
weeks in year.
b. Maternity benefits – The benefit should cover pregnancy, confinement and consequence resulting in
the suspension of earning, Provision should be made to provide medical care including pre – natal
confinements, post natal care and also hospitalization , if necessary, periodical payment limited to 12
weeks should be made during the period of suspension of earnings.
c. Survivor‟s benefit – This should cover periodical payments made to a family following the death of its
bread winner and should continue during the entire period of contingency.
d. Family benefit – This should cover responsibility for the maintenance of children, during the entire
period of contingency. Periodical payment, provisions of food housing, clothing holidays or domestic
help in respect of children should be provided to a needy family.
e. Medical care – This should cover pregnancy, confinement and its consequences and any diseases
which may lead to a morbid condition. The need for pre natal care, in addition to hospitalization, was
emphasized. A morbid condition may require general practitioner care, specialist care, provisions of
essential pharmaceuticals and hospitalization.
f. Unemployment benefit – This should cover the loss of earnings during a worker‟s unemployed period
when he is capable and available for work out but remains unemployed because of lack of suitable
employment. This benefit may be limited to 13 week payment in a year, excluding the first seven days
of waiting period.
g. Employment injury benefit 0 This should cover the following contingencies resulting from accident or
diseases during or from employment
i. morbid condition
ii. total or partial loss of earning capacity which may become permanent
iii. inability to work
iv. death of the bread winner in the family, as a result of which the family is deprived of financial
support. Medical care and periodical payment corresponding to an individual need should be
available
h. Old age benefit – The benefit provides for payment the quantum depending upon an individual‟s
working capacity during the period before retirement – of a certain amount beyond a prescribed age
and continues till death.
i. Individualism benefit – This benefit in the form of periodical payments, should cover the needs of
workers who suffer from any disability arising out of sickness or accident and who are unable to
engage in any gainful activity. This benefit should continue till invalidism changes into old age, when
old age benefit would become payable.

Ashok Mammen V Assistant professor

 UNIT-4
Refer Website - [Link]
Labour Administration - Evolution
Ministry Of Labour & Employment (MOL&E)
Organisations of MOL&E
Shram Suvidha

Labour administration

Labour administration is defined by ILO Convention No. 150 as "public administration activities in the
field of national labour policy."

It is an essential tool at the disposal of governments in fulfilling their responsibilities towards social
issues. International labour standards are usually applied through national law and policy. It is therefore
vital that each country maintain a viable and active labour administration system responsible for all
aspects of national labour policy formulation and implementation. Besides promoting labour
administration systems in a variety of forms, ILO standards at the same time promote the collection of
labour statistics, which are invaluable in identifying needs and formulating labour policy, at both national
and international levels. While labour administrations exist in most countries around the world, many of
them face financial and material difficulties. Adequate financing of labour administration systems is
therefore necessary in order to maintain and strengthen this important tool for development.

The machineries for labour administration in the states are similar to those operating at the center. Most of
the important labour subjects in the concurrent list of the constitution. The central government is
empowered to give direction to the state government and to delegate powers and impose duties on them.
Many central labour laws are enforced both by the central and state government in industries or
establishments falling under their respective jurisdictions.

Generally speaking, labour administration of the state governments is on a pattern similar to central
labour administration with slight variations relating to implementing agencies and the requirements of the
state enactments and non-statutory labour programmes. the main organizations for labour administration
in the states comprise, department of labour and employment (secretariat), office of labour commissioner
chief inspectorate of factories, chief inspectorate of boilers, office of chief inspector, shops and
establishments, directorate, employment and training, directorate, medical services ESI scheme), social
security directorate and adjudication authorities.

DEPARTMENT OF LABOUR AND EMPLOYEMNT (SECERTARIAT)

The responsibility for labour administration in the states generally vests in the department of labour and
employment, the secretariat of which represents the government side. It is generally in charge of a
minister, who may occasionally be assisted by a minister of state and deputy minister. on the official side,
the secretary or the principal secretary is the chief executive. his team generally includes an additional
secretary, and a few joint secretaries, deputy secretaries and under secretaries according to requirements.
it is this organization that formulates the labour policy of the state, establishes liaison with the central
ministry of labour coordinates and guides the activities of enforcing machineries and takes decisions on
behalf of the government.

Ashok Mammen V Assistant professor

MINISTRY OF LABOUR & EMPLOYMENT

Vision
Decent working conditions and improved quality of life of workers, ensuring India without child labor in
hazardous sectors and enhancing employability through employment services and skill development on a
sustainable basis.

Mission
Improving the working conditions and the quality of life of workers through laying down and
implementing policies / programs / schemes / projects for providing social security and welfare measures,
regulating conditions of work, occupational health and safety of workers, eliminating child labour from
hazardous occupations and processes, strengthening enforcement of labour laws and promoting skill
development and employment services.

Organizations of MOL&E

1. Central Board for Workers Education (CBWE)

2. Chief Labour Commissioner (CLC)
3. Directorate General of Employment (DGE)
4. Directorate General Factory Advice Service and Labour Institutes (DGFASLI)
5. Directorate General of Mines Safety (DGMS)
6. Employees State Insurance Scheme (ESIC)
7. Employees Provident Fund Organisation (EPFO)
8. India Labour Archives (ILA)
9. Labour Bureau
10. National Academy For Training And Research In Social Security (NATRASS)
11. V.V. Giri National Labour Institute (VVGNLI)
12. Central Government Industrial Tribunal (CGIT)-cum-Labour Courts

Labour Jurisdiction
Under the Constitution of India, Labour is a subject in the Concurrent List where both the Central & State
Governments are competent to enact legislation subject to certain matters being reserved for the Centre.

Labour Jurisdiction: Constitutional Status

Union List Concurrent List
Entry No. 55 Regulation of labour and safety in mines and oil fields
Entry No. 22 Trade Unions; industrial and labour disputes.
Entry No. 61 Industrial disputes concerning Union employees
Entry No. 23 Social Security and insurance, employment and unemployment.
Entry No. 65 Union agencies and institutions for "Vocational ...training..."
Entry No. 24 Welfare of labour including conditions of work, provident funds, employers "invalidity
and old age pension and maternity

SHRAM SUVIDHA
(One-Stop-Shop for Labour Law Compliance)

The Unified Shram Suvidha Portal is developed to facilitate reporting of Inspections, and submission of
Returns. The Unified Shram Suvidha Portal has been envisaged as a single point of contact between
employer, employee and enforcement agencies bringing in transparency in their day-to-day interactions.
For integration of data among various enforcement agencies, each inspectable unit under any Labour Law
has been assigned one Labour Identification Number (LIN).

Ashok Mammen V Assistant professor

Registration Under Five central Labour Act viz. EPF/ESI/CLRA/BOCW/ISMW is being provided under
'Ease of Doing Business' initiative of Government of India available online now on Shram Suvidha Portal.

(1) The Employees Provident Funds and Miscellaneous Provision's Act (EPF) Act-1952.
(2) Employees' State Insurance Act (ESI) ACT-1948.
(3) Contract Labour (Regulation and Abolition) Act-1970.
(4) Building and Other Construction Workers (BOCW) Act -1996.
(5) Inter-State Migrant Workmen (ISMW) Act-1979.
License: (1) CLRA Act (2) ISMW Act

To find the Applicable Labour Acts

Search >> Industry wise / [Link] Employees / State / District / City-Village-Town
Eg: - In the case of Real Estate in Bengaluru

(1) Contract Labour (Regular and Abolition) Act,1970.

(2) Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act,1979.
(3) Maternity Benefit Act,1960.
(4) Industrial Disputes Act,1961.
(5) Payment of Bonus Act,1965.
(6) Building and Other Construction Workers (Regulation of Employment and Condition of Service)
Act,1966.
(7) Labour Laws (Exemption from Furnishing Returns and Maintaining Registers by Certain
Establishments) Act,1988.
(8) Child Labour (Prohibition & Regulation) Act,1986.
(9) Equal Remuneration Act,1976.
(10) Payment of Gratuity Act,1979.

Major Offices of MOL &E

1. Chief Labour Commissioner (Central)
Indian commission / Website: [Link]/clc / Formed: 1945
Objectives: Enforcement of labour laws and rules made there under in central Sphere, MORE
Jurisdiction: Government of India
Headquarters: New Delhi
Current executive: Anil Kumar Nayak
Ministry: Ministry of Labour and Employment

The Organization of the Chief Labour Commissioner (C) known as Central Industrial Relations
Machinery was set up in April, 1945 in pursuance of the recommendation of the Royal Commission on
Labour in India and was then charged mainly with duties of prevention and settlement of industrial
disputes, enforcement of labour laws and to promote welfare of workers in the undertakings falling within
the sphere of the Central Government. Combining the former organizations of the Conciliation Officer
(Railways) and Supervisor of Railway Labour and the Labour Welfare Advisor, it started with a small
complement of staff comprising Chief Labour Commissioner (C)) at New Delhi, 3 Regional Labour
Commissioners at Bombay, Calcutta & Lahore and 8 Conciliation Officer and increased gradually
consequent upon expanding labour legislations in the Post-independence period, increased industrial
activity in the country and growing responsibilities of the Organization.

1. What are the labour enactments available for the benefit of employees under the Central Sphere
(enforced by the organization of CLC (C)?
a) The Contract Labour (Regulation and Abolition) Act, 1970.
b) The Building and Other Construction Workers (Regulation of Employment and Conditions of
Service) Act, 1996.

Ashok Mammen V Assistant professor

 c) Inter-state Migrant Workmen (Regulation of employment of and conditions of Service) Act, 1979
d) Payment of Wages Act, 1936.
e) The Minimum Wages Act, 1948.
f) The Equal Remuneration Act, 1976.
g) The Payment of Gratuity Act, 1972.
h) The Payment of Bonus Act, 1965.
i) The Industrial Disputes Act, 1947.
j) Hours of Employment Regulation for Railway Servants, 2005.
k) The Child Labour (Prohibition and Regulation) Act, 1986.
l) The Maternity Benefit Act, 1961.
m) The Industrial Employment (Standing Orders) Act, 1946.
n) Labour Laws (Exemption from Furnishing Return & Maintaining Register by Certain
Establishments) Act, 1988.

2. What is the minimum no. of workmen for whom labour license is required to be obtained?
20

3. What is the License fee to be remitted along with the application for Licence?
For 20 Contract Workmen - Rs. 15,
For 21 or more Workmen but less than 50 - Rs. 37.50,
For 51 or more Workmen but less than 100 -Rs. 75,
For 101 or more Workmen but less than 200 -Rs. 150,
For 201 or more Workmen but less than 400 -Rs. 300,
For 401 and above -Rs. 375.00

2. Directorate General of Employment (DGE)

The Directorate General of Employment (DGE) in Ministry of Labour is the apex organization
for development and coordination at National level for the programmes relating to vocational
training including Women's Vocational Training and Employment Services. Employment service
is operated through a countrywide network of Employment Exchanges. Industrial Training
Institutes are under the administrative and financial control of State Governments or Union
Territory Administrations. DGE also operates Vocational Training Schemes in some of the
specialized areas through field institutes under its direct control. Development of these
programmes at national level, particularly in the area concerning common policies, common
standards and procedures, training of instructors and trade testing are the responsibility of the
DGE. But, day-to-day administration of employment Exchanges and Industrial Training
Institutes rests with the State Governments/ Union Territories Administrations. Distribution of
responsibilities between Central Govt., State Governments and Industry has been shown in the
table Tasks and Responsibilities.

3. Directorate General Factory Advice Service and Labour Institutes (DGFASLI)

The office of the Chief Adviser of factories, which is now called Directorate General, Factory
Advice Service and Labour Institutes, was setup in 1945 with the objective of advising Central
And State Governments on administration of the Factories Act and coordinating the factory
inspection services in the States. The Directorate General, Factory Advice and Labour Institutes
(DGFASLI) comprises:

Headquarters situated in Mumbai

Central Labour Institute in Mumbai

Ashok Mammen V Assistant professor

Regional Labour Institutes in Chennai, Kanpur, Kolkatta and Faridabad.

The DGFASLI is an attached office of the Ministry of Labour & Employment, Government of
India and serves as a technical arm to assist the Ministry in formulating national policies on
occupational safety and health in factories and docks. It also advises factories on various
problems concerning safety, health, efficiency and well - being of the persons at work places.

4. Labour Bureau
Labour Bureau is responsible for the collation, collection and publication of statistics and related
information on wages, earnings, productivity, absenteeism, labour turn-over, industrial relations,
working and living conditions and evaluation of working of various labour enactments etc. It is a
storehouse of important economic indicators like Consumer Price Index Numbers for Industrial,
Agricultural and Rural Labourers; wage rate indices and data on industrial relations, socio-
economic conditions in the organized and unorganised sector of industry etc. The
functions/activities of Labour Bureau can be classified under three major heads:

 Labour Intelligence
 Labour Research
 Monitoring and evaluation studies under the Minimum Wages Act 1948.

MOU signed between MOL&E and Labour Bureau

Autonomous Organisations under the MOL&E

1. Employees State Insurance Scheme (ESIC)

Employees‟ State Insurance Scheme of India, is a multidimensional social security system
tailored to provide socio-economic protection to worker population and their dependants covered
under the scheme. Besides full medical care for self and dependants, that is admissible from day
one of insurable employment, the insured persons are also entitled to a variety of cash benefits in
times of physical distress due to sickness, temporary or permanent disablement etc. resulting in
loss of earning capacity, the confinement in respect of insured women, dependants of insured
persons who die in industrial accidents or because of employment injury or occupational hazard
are entitled to a monthly pension called the dependants benefit.

2. Employees Provident Fund Organisation (EPFO)

The Constitution of India under "Directive Principles of State Policy" provides that the State
shall within the limits of its economic capacity make effective provision for securing the right to
work, to education and to public assistance in cases of unemployment, old-age, sickness &
disablement and undeserved want. The EPF & MP Act, 1952 was enacted by Parliament and
came into force with effect from 4th March,1952. A series of legislative interventions were made
in this direction, including the Employees" Provident Funds & Miscellaneous Provisions Act,
1952.

3. V.V. Giri National Labour Institute (VVGNLI)

V.V. Giri National Labour Institute is a premier national institution involved with research,
training, education, publication and consultancy on labour related issues. The Institute,

Ashok Mammen V Assistant professor

established in 1974, is an autonomous body of the Ministry of Labour and Employment,
Government of India.

4. Central Board for Workers Education (CBWE)

The Central Board for Workers Education (CBWE) is an autonomous body under the Ministry of
Labour & Employment, Government of India. It is registered under the Societies Registration
Act, 1860. Started in 1958, the Workers Education Scheme in India has been playing a very
significant role in our national development; creating an enlightened and disciplined work force
and bringing about desirable behavioral changes in our workforce in the organized, unorganized
and rural sectors. It gets grants-in-aid from the Ministry of Labour & Employment to operate its
activities. The Scheme of Workers Education aims at achieving the objectives of creating and
increasing awareness and educating the workforce for their effective participation in the socio-
economic development of the country. To achieve these objectives, various training programmes
are conducted by the Board for the workers of formal and informal sectors at national, regional
and unit levels through a network of 50 Regional and 09 Sub-Regional Directorates spread all
over the country and an apex Training Institute viz. Indian Institute of Workers Education
(IIWE) at Mumbai.

Adjudication Bodies
Central Government Industrial Tribunal (CGIT)-cum-Labour Courts
Central Government Industrial Tribunal-cum-Labour Courts (CGIT-cum-LCs) are set up under
the provisions of Industrial Disputes Act, 1947 for adjudication of industrial disputes arising in
Central Sphere. There are 22 CGIT-cum-LCs set up in various States, out of which 10 are under
Non-Plan and 12 under Plan Scheme. The CGIT-cum-LC No.1, Mumbai and CGIT-cum-LC,
Kolkata also function as National Tribunals. These CGIT-cum-LCs are headed by Presiding
Officers who are selected from amongst High Court Judges (serving/retired) or Distt./Addl.
Distt. Judges (serving/retired).
The CGIT-cum-LCs have been set up with the objective of maintaining peace and harmony in
the industrial sector by quick and timely disposal of industrial disputes through adjudication so
that industrial growth does not suffer on account of any widespread industrial unrest. Moreover,
due to increasing awareness about their rights and Labour laws among the workers, there is a
gradual increase in the number of cases being filed under the I.D. Act before the CGIT-cum-LCs.
Restructuring of workforce on account of application of latest technology in the industries has
also resulted in retrenchment, declaration of surplus etc. which has further led to an increase in
workers‟ grievances. The 22 CGIT-cum-LCs are located at various states.

INDEX

1. Directorate General of Employment & Training (DGE&T)

2. National Employment service(NES)
3. Directorate General Factory Advice Service and Labour Institutes (DGFASLI)
4. Employees‟ State Insurance Act, 1948 (ESIC)
5. Employees' Provident Fund Organisation, India (EPFO)

Ashok Mammen V Assistant professor

6. Central Board For Workers Education (CBWE)
(refer government website for details)

I. DIRECTORATE GENERAL OF EMPLOYMENT & TRAINING (DGE&T)

The Directorate General of Training (DGT) in Ministry of Skill Development and Entrepreneurship is the
apex organisation for development and coordination at National level for the programmes relating to
vocational training including Women's Vocational Training. Industrial Training Institutes are under the
administrative and financial control of State Governments or Union Territory Administrations. DGT also
operates Vocational Training Schemes in some of the specialized areas through field institutes under its
direct control. Development of these programmes at national level, particularly in the area concerning
common policies, common standards and procedures, training of instructors and trade testing are the
responsibility of the DGT. But, day-to-day administration of Industrial Training Institutes rests with the
State Governments/ Union Territories Administrations.

Regional Directorate Of Skill Development And Entrepreneurship (RDSDE) in KARNATAKA

@ RDSDE, Karnataka, NSTI Campus(FTI Campus), Outer Ring Road, Bengaluru 560022

Major functions of the DGT are:

 To frame overall policies, norms and standards for vocational training.

 To diversify, update and expand training facilities in terms of craftsmen and crafts instructor training.
 To organize and conduct specialized training and research at the specially established training
Institutes.
 To implement, regulate and increase the scope of training of apprentices under the Apprentices Act,
1961.
 To organize vocational training programmes for women.
 To provide vocational guidance and employment counselling.
 Assist scheduled castes/scheduled tribes and persons with disabilities by enhancing their capabilities
for wage employment and self employment.

The Craftsmen Training Scheme (CTS) was introduced by the Government of India in year 1950 to
ensure a steady flow of skilled workers in different trades for the domestic industry, to raise quantitatively
and qualitatively the industrial production by systematic training, to reduce unemployment among the
educated youth by providing them employable skills, to cultivate and nurture a technical and industrial
attitude in the minds of younger generation. The Scheme is the most important in the field of Vocational
Training, has been shaping craftsmen to meet the existing as well as future manpower need, through the
vast network of ITIs spread over various States / Union Territories in the country. The day-to-day
administration of Industrial Training Institutes (ITIs) under the Craftsmen Training Scheme was

Ashok Mammen V Assistant professor

transferred to the State Governments/ Union Territory administrations with effect from the year 1956.
From 1st April 1969, the financial control of the Industrial Training Institutes in the States as well as in
the Union Territories was transferred to the respective State Governments / Union Territory. The financial
assistance was granted to them in the form of bulk grant in consultation with the erstwhile Planning
Commission and the Ministry of Finance.

Vocational Training is a concurrent subject of both Central and State Governments. The development of
training schemes at National level, the evolution of policy, laying of training standard, norms, conducting
of examinations, certification, etc. are the responsibilities of the central government, whereas, day to day
administration including an admission in ITIs rests with the respective State Governments / UTs.

Presently, training courses under the Craftsmen Training Scheme are being offered through a network of
15,042 ITIs (Govt. 2,738 + Private 12,304) located all over the country with total trainees enrolled 22.82
lakhs (in the trades of 1 year and 2 year durations) on NCVTMIS portal with an objective to provide
skilled workforce to the industry in 138 NSQF compliant trades. Duration of these training courses varies
from 6 Months -2 Years duration, NSQF compliant courses in 138 Trades which includes 74 Engineering
trades, 59 Trades in the Non-Engineering Sector and 05 courses for Persons with Disabilities (PwD)/
Divyangjan. Currently (2018), 23.15 Lakh persons are undergoing training in 14,491 ITIs (both Govt. &
Pvt.).

A provision for supplementing the skills learnt during the ITI training is also available in the form of
workplace training through the Apprenticeship Training Scheme (ATS). Also, one of the prime objectives
of this scheme is optimal utilization of the infrastructural facilities available in the industry, where the
apprenticeship training actually takes place, hence meeting the requirement of skilled manpower for
industry.

A comprehensive training, both in skills and training methodology is imparted to those interested in
becoming Instructors/ trainers in vocational training institutes, under the Craft Instructor Training Scheme
(CITS). The idea is to develop their skills and competencies and make them conversant with the
techniques of transferring hands-on skills to their students. This scheme is implemented through the
National Skill Training Institutes (NSTIs) located in 33 locations across the country.

These also conduct short duration, specialized and tailor-made courses suiting to the specific requirements
of industrial establishments are also offered for upgrading the skills of serving industrial workers, under
the Advanced Vocational Training Scheme (AVTS).

Since DGT has been striving ahead in this technological age for hand holding the youth across the
country, it has ensured digital skilling and industry readiness of the 23.15 Lakh trainees in the ITI
ecosystem by making „Employability Skills‟ as a mandatory component of their curriculum.

Ashok Mammen V Assistant professor

DGT is in process of constantly upgrading and modernizing the ITIs in terms of their infrastructure,
pedagogy, curriculum and technology interventions. Accordingly, new-age courses in IoT, Renewable
Energy, Additive Manufacturing Technology (3-D Printing), Mechatronics, Drone Technology, etc. have
been recently introduced in the ITIs.

Further, with an objective to strengthen Industry connect and impart industry relevant training, DGT has
introduced the Dual System of Training (DST) model wherein the ITIs are being encouraged to join hands
with multiple industry partners for providing mandatory industrial exposure to the trainees during the
course of their training. Hence a part of their skill training takes place in the industry environment. The
Flexi- MoU model offering customized, industry relevant training, entirely on the industry premises has
also been introduced for providing flexibility to create tailored skilling programmes.

Schemes for Training

1. WOMEN TRAINING

Women‟s Vocational Training Programme under Ministry of Skill Development & Entrepreneurship
takes care of providing skill training to women in the country and aims at stimulating employment
opportunities for social development, economic growth and empowerment of women.

NSTIs (erstwhile NVTI/RVTIs) for women are set up mainly to produce women instructors. These
trained instructors provide training to students through a network of Industrial Training Institutes (ITIs)
all over the country.

NSTIs for women have been set up keeping in mind the need of women belonging to lower income strata
group and weaker sections of the society. Many practices like raw material, merit-cum-means stipend /
scholarship, hostel facilities etc. have been adopted to attract these girls and women for skill training.

The NSTIs for women organize NCVT approved skill training programmes under Craftsmen Training
Scheme (CTS) and Craft Instructors‟ Training Scheme (CITS) in trades such as Electronics Mechanic,
Architectural Draughtsmanship, Computer Operator and Programming Assistant, Secretarial Practice,
Cosmetology, Dress Making, Catering & Hospitality, Interior Decoration & Designing etc.

Vocational Training exclusively to women were earlier provided through 11 National Skill Training
Institutes (NSTIs) for women, one each at Noida, Mumbai, Bengaluru, Thiruvananthapuram, Panipat,
Kolkata, Tura, Allahabad, Indore, Vadodara &, Jaipur.

Ashok Mammen V Assistant professor

To enhance the skill training facilities for women in India, establishment of 8 New NSTIs (erstwhile
RVTIs) have been approved by Govt. of India in the states where there were no existing NSTIs for
women. Out of these 8 NSTIs(W), 07 NSTIs(W) have started functioning in the states of Punjab,
Himachal Pradesh, Bihar, Tripura, Tamil Nadu, Telangana and Goa.

A total of 4664 regular seats have been sanctioned in NSTIs for women in 2017-18 in various training
courses under CTS and CITS. Since inception 1,45,000 women trainees have been trained in these
institutes. (Page Last updated on : 14-11-2018)

2. CRAFTSMEN TRAINING

The Directorate General of Training (DGT) (erstwhile DGE&T, Ministry of Labour and Employment) in
the Ministry of Skill Development and Entrepreneurship, Government of India initiated Craftsmen
Training Scheme (CTS) in 1950 by establishing about 50 Industrial Training Institutes (ITIs) for
imparting skills in various vocational trades to meet the skilled manpower requirements for technology
and industrial growth of the country. The second major phase of increase in ITIs came with the oil-boom
in West-Asia and export of skilled manpower to that region from India. Several new private ITIs were
established in 1980‟s in southern states mostly in Kerala, Karnataka and Andhra Pradesh, etc. from where
trained craftsmen found placement mainly in Gulf countries. In 1980, there were 830 ITIs and the number
rose to 1900 ITIs in 1987. During 1990‟s, the growth of ITIs had been steep and presently there are over
10,750 ITIs (2275 in Govt. & 8475 in Private Sector) having a total seating capacity of 15.22 lakhs.

Under the constitution of India, Vocational training is the concurrent subject of both Central and State
Governments. The development of training schemes at National level, evolution of policy, laying of
training standards, norms, conducting of examinations, certification, etc. are the responsibilities of the
Central Government, whereas the implementation of the training schemes largely rests with the State
Govts./UT Administrators. The Central Govt. is advised by the National Council of Vocational Training
(NCVT), a tripartite body having representatives from employers, workers and Central/State
Governments. Similar Councils termed as State Councils for Vocational Training are constituted for the
same purpose by the respective State Governments at state levels. (Page Last updated on : 15-03-2017)

2.1 National Council For Vocational Training

In pursuance of the recommendation of the All India Council for Technical Education, the Government of
India in the Ministry of Labour Resolution No. RTA-428(5)/dated the 22nd May, 1951, appointed a
committee called the National Trade Certification Investigation Committee with instructions to prepare a
scheme for the establishment of an All India Trades Board which would award certificates of proficiency
to craftsmen in the various engineering and building trades. The report of this committee and also the
recommendation of the Training and Employment Services Organisation Committee (known as the Shiva
Rao Committee) have been considered by the Government of India. The Government agreed with both
the committees that there is a need for setting up a central agency for co-ordinating the training
programmes in the country bringing about uniformity of standards and awarding certificates of
proficiency in craftsmanship on an All India basis. Such a step is in the interest of both the industry and

Ashok Mammen V Assistant professor

the workers in as much as it ensures that the holders of National Certificates possess a minimum
recognised degree of skill. In addition, it facilitates mobility of tradesmen for their better employment.

The Government of India have also decided to transfer the administration of the training matter under the
Directorate General of Resettlement and Employment to the control of the State Government concerned,
retaining for themselves the functions of co-ordinating craftsmen training and laying down the training
policy. This decision has further accentuated the need for a central agency for assisting or advising the
Central Government in the discharge of their responsibilities regarding Craftsmen Training. It has
accordingly been decided, in consultation with the State governments and other concerned parties, to set
up a National Council for Vocational Training. Accordingly with a view to ensure and maintain
uniformity in the standards of training all over the country, the National Council for Vocational Training,
an advisory body, was set up by the Government of India in the year 1956 ( The then National Council of
Training in Vocational Trades(NCTVT) . The Council has been entrusted with the responsibilities of
prescribing standards and curricula for Craftsmen Training, advising the Government of India on the
overall policy and programmes, conducting All India Trade Tests and awarding National Trade
Certificates. The National Council is chaired by the Minister of State for Skill Development and
Entrepreneurship (I/C), with members representing Central and State Government departments,
employers‟ and workers‟ organisations, professional and learned bodies, All India Council for Technical
Education, scheduled castes and scheduled tribes, All India Women‟s Organisation, etc. The State
Council for Vocational Training at the State level and the Sub Committees have been established to assist
the National Council.

3. APPRENTICESHIP TRAINING SCHEME

Development of human resource is crucial for the industrial development of any nation. Up-gradation of
skills is an important component of Human Resource Development. Training imparted in institutions
alone is not sufficient for acquisition of skills and needs to be supplemented by training at the workplace.
The Apprentices Act, 1961 was enacted with the prime objective to utilize fully the facilities available in
industry for imparting practical training with a view to meeting the requirements of skilled manpower for
industry. Initially, the Act covered the apprenticeship training for the trade Apprentices and subsequently
amended in 1973, 1986 and 2014 to bring the Graduates, Technician, Technician (Vocational) and
Optional Trade Apprentices respectively under its purview.

Apprentices Act, 1961 was enacted with the following objectives :-

 To regulate the programme of training of apprentices in the industry so as to conform to the syllabi,
period of training etc. as laid down by the Central Apprenticeship Council; and
 To utilise fully the facilities available in industry for imparting practical training with a view to
meeting the requirements of skilled manpower for industry.

MONITORING OF THE IMPLEMENTATION OF THE ACT

Ashok Mammen V Assistant professor

 Directorate General of Training under Ministry of Skill Development and Entrepreneurship monitors
the implementation of the Apprentices Act in respect of Trade Apprentices in the Central
Government Undertakings & Departments and establishments operating business 4 or more states
through six Regional Directorates of Apprenticeship Training (RDAT) located at Chennai,
Faridabad, Hyderabad, Kanpur, Kolkata, & Mumbai.
 State Apprenticeship Advisers are responsible for implementation of the Act in respect of Trade
Apprentices in State Government Undertakings/ Departments and Private Establishments.
 Department of Education in the Ministry of Human Resource Development is responsible for
monitoring the implementation of the Act in respect of Graduate, Technician & Technician
(Vocational) Apprentices. This monitoring is done through four Boards of Apprenticeship Training
located at Chennai, Kanpur, Kolkata and Mumbai.

CENTRAL APPRENTICESHIP COUNCIL

It is an apex statutory body. It is tripartite by constitution with members from Government both Central
and States/UTs, Employers etc. It advises the Government on laying down of policies and prescribing
norms & standards in respect of Apprenticeship Training.

Fields of apprenticeship training

Apprenticeship training can be provided to apprentices both in designated and optional trades.

(i) Designated trade - means any trade or occupation as notified by the Government.

(ii) Optional trade - means any trade or occupation decided by an employer.

Categories of apprentices

There are five categories of apprentices:

1. Trade apprentices
2. Graduate apprentices
3. Technician apprentices
4. Technician (Vocational) apprentices
5. Optional trade apprentices

Coverage

 It is obligatory on the part of employers having manpower strength 40 or more and having requisite
training infrastructure as laid down in the Act, to engage apprentices.
 Employer shall engage of apprentices in a band of 2.5% to 10% of total manpower strength of the
establishments including contractual staff.
 The total engagements of apprentices in the band with of 2.5% to 10% include all categories of
apprentices engaged by establishment.

Ashok Mammen V Assistant professor

 The establishments /Employers can decide the categories of apprentices and trade(s) in which the
apprentices to be engaged depending upon the facility available with them for imparting on-the- job
training/ practical training at his workplace.

TRAINING OF TRADE APPRENTICES

 Minimum age is 14 years.

 Qualifications vary from Class VIII pass to XII class pass (10+2) system.
 Period of training varies from one year & two months to 2 years
 Training comprises Basic Training and Practical Training followed by Related Instructions as per
prescribed syllabus for each trade.
 261 trades in 39 trade groups have been designated.
 Numbers of seats for apprentices are calculated in the band of 2.5% to 10% of the total strength of the
workers.
 Every apprentice and employer has to enter into a contract of apprenticeship training, which is
registered by the Apprenticeship Advisers.
 Employers and apprentices have to fulfil their obligations under the Act.

TESTING AND CERTIFICATION OF TRADE APPRENTICES

All India Trade Tests (AITT) for trade apprentices are conducted by National Council of Vocational
Training (NCVT) twice a year ( October/ November and April/May).

National Apprenticeship Certificates (NAC) are awarded to those who pass the AITT.

NAC is recognized for employment under Govt./Semi-Government departments/ organizations.

SKILL COMPETITION OF TRADE APPRENTICES

With a view to fostering healthy competition among apprentices as well as establishments, skill
competition is organized at local, regional & All India levels.

Skill competition is held for 15 trades namely; Fitter, Machinist, Turner, Welder (Gas & Electric),
Electrician, Mechanic (Motor Vehicle), Tool & Die Maker (Die & Moulds), Tool and Die Maker(Press
Tool, Jigs & Fixture), Instrument Mechanic, Draughtsman (Mechanical), Mechanic Machine Tool
Maintenance, Wireman, Mechanic(Diesel), Refrigeration & Air-Conditioning Mechanic and Electronics
Mechanic.

TRAINING OF GRADUATE, TECHNICIAN AND TECHNICIAN (VOCATIONAL APPRENTICES)

163 subject fields have been designated for the category of Graduate & Technician apprentices.

137 subject fields have been designated for the category of Technician (Vocational) apprentices.

Period of post qualification training for these categories is one year.

Seats are located based on managerial/supervisory posts and training facilities.

Ashok Mammen V Assistant professor

Training programme is prepared in joint consultation between Apprenticeship Adviser Establishment
concerned.

Certificates are awarded on completion of training by the Dept. of Education, Ministry of Human
Resource Development. (Page Last updated on : 15-01-2018)

4. POLYTECHNICS

The functioning of polytechnics have been transferred from Department of Higher Education, Ministry of
Human Resources Development (MHRD) to Ministry of Skill Development and Entrepreneurship
(MSDE) and to Directorate General of Training (DGT) in September 2018.

Scheme of Polytechnics

a) Setting Up of New Polytechnics in Un-served & Underserved Districts

Under this scheme, 300 new polytechnics are being set up by the State Governments/ Union
Territories in un-served and underserved districts with assistance from Government of India limited
to Rs.12.3 crore per polytechnic to meet the capital costs of establishing a polytechnic.
Whereas the State Government shall provide the land required as per AICTE Norms, free of cost,
for setting up the Polytechnic, the State Government shall also meet any additional
requirement of non-recurring expenditure over and above the ceilings of Rs. 12.30 crores. Further,
it shall also be the responsibility of the State Government to bear all the recurring expenditure in
running the polytechnic. The State Government will identify the location for the proposed
polytechnics under the Scheme in the selected districts.

b) Central assistance for Construction of Women's Hostels in selected Polytechnics

In order to enhance women enrolment in polytechnic education, the Scheme for Construction of Women‟s
Hostels in selected Polytechnics was introduced in the 11th Plan. The scheme envisages financial
assistance subject to a maximum of Rs. 1.00 crore for each polytechnic, to be provided to 500 existing
AICTE approved Government / Government aided Polytechnics, for the construction of women‟s hostel.

c) Central assistance for up-gradation of selected Polytechnics

Under this scheme, financial assistance is provided by Government of India to upgrade infrastructure
facilities of 500 existing diploma level public funded Polytechnics by (i) providing financial assistance for
modern equipments and by replacement of obsolete equipments, (ii) providing modern facilities for
application of IT in teaching, learning and testing processes and (iii) introduction of new diploma courses.
The Scheme provides for Central assistance to 500 polytechnics, upto ₹2.00 crores per Polytechnic.

d) Scheme of Community Development Through Polytechnics (CDTP)

CDTP scheme envisages providing non formal, short term, employment oriented skill development
programmes, through AICTE approved Polytechnics, to various sections of the community, particularly
the rural, unorganized & disadvantaged sections of the society, to enable them to obtain gainful self /

Ashok Mammen V Assistant professor

wage employment. Duration of training usually ranges from three to six months. These courses are being
offered by the Polytechnics in their premises, as well as through extension centres, set up in nearby
locations, from where, these courses can be offered to the local community. No fee is charged from the
trainees under this Scheme and there is no restriction of age and qualification for the trainees.

Recurring grant up to Rs. 17.00 lakh per polytechnic per annum is provided by Central Government.

II. National Employment service(NES)

National Employment service(NES) came into the existence in July 1945 for the purpose of resettling
demobilized Defence service personnel and discharged War Workers in civil life through the network of
employment exchanges controlled by the then Directorate General of Resettlement and Employment
(DGR&E) now known as Directorate General of Employment and Training (DGE&T). After
Independence, the Directorate was also called upon to handle work relating to displaced persons from
Pakistan. Subsequently, the scope of the Directorate was extended to cover, employment service to all
categories of job-seekers in early 1948. In pursuance of the recommendations of the Training and
Employment Service Committee ( Shiv Rao Committee set up in 1952) the day-to-day administrative
control of the Employment Exchanges was transferred to the State Governments/Union Territory
Administrations with effect from 1.11.1956.

Present National Employment Service functions within the conceptual framework of the ILO Convention
No.88 on Organisation of Employment Service. Employment Services are provided free of cost. The
primary objective is settlement of job-seekers either through regular jobs or through self-employment. For
furtherance of the employability of the job-seekers, collection of employment market information, career
counselling and vocational guidance are inbuilt in the system. The network of the Employment Service
consists of about 966(excluding rural and similar) Employment Exchanges run by the State
Governments. Private placement agencies are also operating on a limited scale primarily in the urban area
to cater to the requirement of the specialised fields in the organised sector. Such agencies which help in
achieving the above objective charge fees of varying amount both from the jobseekers and the employers.

Functions of the National Employment Service(NES)

The National Employment Service and for that matter Employment Exchanges functions within the ambit
of Employment Exchanges ( Compulsory Notification of Vacancies ) Act 1959 enacted within the
framework of ILO convention no 88.. According to the act Notification of vacancies arising in all the
public sector establishments and non-agricultural establishments in the private sector employing 25 or
more workers is compulsory. The act also makes it obligatory on the part of such employers to furnish
employment returns (called ER-I and ER-II) which give information on employment, vacancies occurred,
mode of recruitment of persons in the vacancies occurred, occupational distribution of employees and
educational requirements for those occupations etc. Therefore the objectives of the National Employment
Service in brief are as follows.

Ashok Mammen V Assistant professor

1. Collect, compile and disseminate information on vacancies notified, employment in various
industries, types of occupations in existence, qualifications required for various occupations,
emerging trend of employment in various industries etc.
2. To have an assessment of demand (from notification of vacancies) and supply of labour (from
registration of Jobseekers) in the Labour Market and adjust them.
3. Create requisite data base for manpower planning and management, career counselling and vocational
guidance with a view to effectively guiding the job-seekers.

In order to achieve the above objectives, the National Employment Service which operates through
the network of Employment Exchanges, carries out the following functions:

1. Registration and placement of job-seekers so as to ensure a proper balance between demand and
supply.
2. Collect comprehensive Employment Market Information on a quarterly basis for creation of data base
for use in effective management of the demand and supply of labour, preparing career literature for
counselling and vocational guidance.
3. Career Counselling and Vocational Guidance.
4. Conduct area specific specialised study/surveys to have an assessment of skills available and the
marketable skills required for encouraging the job-seekers for self-employment particularly in rural
informal sector.
5. Some of the State Governments arrange disbursement of unemployment allowance to certain specific
categories of jobseekers out of their own resources through the employment exchanges as registered
with them.

Private Placement agencies

Private placement agencies normally consider placement in relatively large industrial establishments,
utilize the data collected through the National Employment Service, data collected by their personal
contact, public notifications in the News Paper and periodicals, internet etc. They generally charge fees
from the job-seekers as well as from the employers for their services. These agencies function primarily
in the Metropolitan cities. These agencies again are very small and concentrate on placement only. Fake
placement agencies also exist. These fake agencies collect money from the jobseekers and arrange fake
interview in connivance with some of the industries or agents. Jobseekers, therefore may be careful in
utilizing their services. Government of India, Ministry of Labour & Employment issued guidelines in the
year 2003 to State Governments/UT administrations regarding regulation of functioning of private
placement agencies. Some State governments are registering them under Shops & Establishment Act.

The responsibilities of the State Government

The responsibilities of the State Govts. are as under;

 exercise full control over the Exchange in the States, including the power of appointment, control,
promotion and punishment of all their staff as well as the staff of State Directorates;
 carry out inspection of Employment Exchanges to assess the effectiveness of their work and take
appropriate action to bring about necessary improvements;
Ashok Mammen V Assistant professor
 organise and carry out training programmes for non-gazetted staff in accordance with national
policies;

 organise vacancy and labour clearing in Employment Exchanges at the State level and co-ordinate
with the central machinery;
 collect, compile, analyse and interpret statistical and employment market data in the prescribed
manner and furnish such data and information to the Government of India as may be required;
 provide and disseminate information to public and private bodies in the State interested in such
information;
 plan, develop and carry out at State and local levels a programme of employer and worker relations in
accordance with national policies;
 arrange for co-ordination and consultation with departments of the State Government whose
activities effect the employment situation in the State;
 set up, in accordance with national policies, Committees on Employment at State and
 local levels;
 refer to the Government of India for consideration recommendations of Committees on Employment
involving major changes in policy or procedure;'
 carry out at State and local levels, a public relations and information programme in accordance with
national policies; and
 provide full facilities to the authorised officers of the Government of India to evaluate the work of
Employment Exchanges.

Central Employment Exchange The Central Employment Exchange, Delhi is responsible for the
advertisement of vacancies of scientific and technical nature occurring in the Central Government
Establishments with the basic pay of Rs. 1400/- p.m. (Pre-revised) or above. As per revised procedure laid
down by DOPT all the vacancies notified to CEE as per EE (CNV) Act, 1959 are to be advertised in
Employment News by Central Employment Exchange.

Ex-Servicemen Cell In order to provide placement service to the disabled Ex-Servicemen/Border

Security Force personnel and the dependents of Defence Service personnel/Border Security Force
personnel killed or severely disabled in action, against the vacancies reserved for Ex-Servicemen and
earmarked for priority categories, and Ex-Servicemen Cell was set up in the Directorate General of
Employment & Training in July, 1972. Subsequently, the scope of the special services was also extended
for the benefit of Ex-Servicemen disabled during peace time as well as dependents of the Defence Service
personnel killed or severely disabled in peace time provided that the death or disability attributable or
military service w.e.f. February, 1981.

Employment Exchanges (Compulsory Notification of Vacancies) Amendment Bill, 2013 Forty-second

Report of the Standing Committee on „The Employment Exchanges (Compulsory Notification of
Vacancies) Amendment Bill, 2013 was presented to Lok Sabha/laid in Rajya Sabha on 7th February,
2014. It has recommended to the Government to withdraw the Employment Exchanges (Compulsory

Ashok Mammen V Assistant professor

Notification of Vacancies) Amendment Bill, 2013 and to bring a comprehensive Amendment Bill so that
the Employment Exchanges are able to fulfill their role in the present times.

Some of the issues highlighted by the Standing Committee are given below:

1. The definition of „employee‟ needs to be inclusive to cover all such scenarios where employers look
for new ways to solicit employees.
2. Amendment regarding substituting the nomenclature of Employment Exchanges with Employment
Guidance and Promotion Centres for improving the services and widening the coverage of the Act in
the interest of the large employment seeking population of the country. The Committee has suggested
that the Act may be called as „National career Service Act‟.
3. Census/surveys of the Establishments can be better carried out by dedicated organizations and the
employment exchanges should concentrate on providing information about employment opportunities
to the largest number of people and information about unemployed youth to the prospective
employers.
4. To curb the exploitation of the poor workers, the revamped Employment Exchanges, may involve
themselves in this field.
5. Provision for regulating the private placement agencies may also be made in the amended Act.
6. Bill needs to provide an inclusive definition to cover future developments.
7. The Act has left „contract farming‟ out of purview where companies enter into agreement with the
cultivators for production and supply of agricultural products.
8. No provision has been made in the Act for intimation of a vacancy as it is advertised in other media to
give equal opportunity to those registered with the employment exchanges.
9. The Committee are of the view that the Bill seeks to cover establishments employing 10-24 workers
only to enhance database thereby losing its focus i.e. providing information about job opportunities to
the unemployed youth.
10. The Committee observe that the Employment Exchanges have lost their significance due to changing
trends for e.g. rise in number of contract workers, use of capital intensive techniques, technological
developments, outsourcing and emergence of recruitment boards have led to reduced coverage under
the Act.
11. Employment Exchanges should aim to match the requirements of the employers with the skill sets of
the employees and for matching them, they should strive to provide short term courses, vocational
guidance, training and career counselling by qualified career counsellors to the registered candidates.
12. The Act should aim at making the establishments in both private and public sector transparent in
their recruitment policies by displaying the status of vacant posts as and when they arise and those
opened for filing on the web portal. But, the present Amendment Bill fails to offer anything in this
direction.

Employment Market Information Programme The main objectives of the Employment Market
Information (EMI) Programme are: -

 to provide information at short intervals about the structure of employment in the public and private
sectors at the area, state and national levels and also to monitor the changes in the level of
employment

Ashok Mammen V Assistant professor

 to present occupational composition and educational profile of employees in the public and private
sector establishments.
 to identify the occupations which are characteristic to a given industry.
 to assess the manpower shortages in various industries and in various occupations in the organised
sector.
 to make available information required for career counselling and vocational guidance through the
National Employment Service.
 to monitor the progress in generating employment in organized sector during the five year Plans.

Coverage The data collected under the EMI programme covers only the Organised Sector of the
economy which inter-alia covers all establishments in the Public Sector irrespective of their size and non-
agricultural establishments in the Private Sector employing 10 or more persons. While the information
from non-agricultural establishments in the Private Sector employing 25 or more persons is collected
under the provisions of of the Employment Exchanges (Compulsory Notification of Vacancies) Act 1959,
data from the establishments employing 10-24 persons is collected on a voluntary basis.

Under the EMI programme collection of data is done following the “establishment reporting system”.
The establishments are required to furnish at regular intervals details about the number of persons they
employ by sex, vacancies that have occurred and the type of persons, which are in short supply. This
information relates only to ‟Employers‟ and „Employees‟. Employers include Owners, Proprietors,
Managers, Working Partners, or Directors of Firms/Companies who work full time for the
firms/companies.

Geographical Coverage The EMI programme was initiated in the year 1955 as a Pilot Project in Delhi,
which was subsequently extended to selected areas (Districts) in various States during the Second Five-
Year Plan period. At present the EMI Programme is being implemented in all the States and Union
Territories of the country except Arunachal Pradesh, Sikkim, Dadra & Nagar Haveli and Lakshadweep.
The programme could not be extended to these States/UTs so far due to administrative reasons. The
smaller establishments employing 10-24 persons in the Private Sector in metropolitan areas of greater
Mumbai and Kolkata are also not being covered owing to administrative reasons.

Reference Period The EMI data are furnished by the establishments through ER-I and ER-II returns.
The return ER-I is used for the collection of information from the establishments at quarterly intervals
(i.e. as on 31st March, 30th June, 30 September and 31st December of each year) relating to Employment,
Vacancies, Manpower shortages, The return ER-II is used for collection of information relating to
Occupational and Educational details of the employees. This is collected once in two years and as on
30th September.

Organisation of the Programme The information collected through ER-I is scrutinised, tabulated and
disseminated at the area, state and national level. The employment exchanges prepare Area Employment
Market Reviews to indicate employment situation in the organised sector within the district. The State

Ashok Mammen V Assistant professor

Directors of Employment also prepare state level Employment Reviews showing employment situation
prevailing at the State level. At the National level, on the basis of information supplied by the State/UT
Governments, Quick Estimate of Employment, Quarterly and Annual Employment Reviews are prepared
and published by the Directorate General of Employment and Training projecting the overall picture of
Employment in the organised sector in different States/UTs.

The information collected through ER-II are processed at national level (DGE&T) and industry wise
occupational and educational profile of the employment in organized sector generated and published.

III. DIRECTORATE GENERAL FACTORY ADVICE SERVICE AND LABOUR

INSTITUTES (DGFASLI)

The office of the Chief Adviser of factories, which is now called Directorate General, Factory Advice
Service and Labour Institutes, was setup in 1945 with the objective of advising Central And State
Governments on administration of the Factories Act and coordinating the factory inspection services
in the States. The Directorate General Factory Advice and Labour Institutes (DGFASLI) comprises:
Headquarters situated in Mumbai
Central Labour Institute in Mumbai
Regional Labour Institutes in Chennai, Kanpur, Kolkatta and Faridabad.

The DGFASLI headquarters Mumbai maintains overall liaison with its Central and Regional Labour
Institutes, frames policy, plans and executes the program concerning the organization on matters
pertaining to safety, health and welfare of workers in industries and docks and implements technical
projects and liaises with national and international agencies.

The headquarters consists of the following divisions :

 Factory Advice Service
 Docks Safety
 Construction Safety
 Awards
 MIS Division

Factory Advice Service

The Factory Advice Service division coordinates the administration of the Factories Act in the States
and advises the Central and State Governments on related matters. The activities include
interpretation of the provisions of the Act and the Rules, formulation of Model Rules, recommending
amendments to the provisions of the Factories Act, and the Rules whenever necessary, issue of
technical guidelines, organizing and conducting training for Inspectors of Factories, recommending
approval of flameproof equipment for use in the factories, review and comment on documents on
safety and health from the International Labour Organisation and other international agencies and
participation in international programmes.

Ashok Mammen V Assistant professor

A conference of the Chief Inspectors of Factories of the States is convened annually for the purpose
of obtaining their views and suggestions regarding the changes that need to be made in the Act and
Rules to meet the challenges brought about by new technology and changing socio-economic
scenario. The division organises training for Fellows from developing countries under various
technical assistance programmes of the government.

The statistical cell under the division collects and compiles accident statistics and other information
related to the administration of the Factories Act and Rules framed there under. This information
base is used in planning and implementation of national policies concerning occupational safety and
health as well as preparing replies to the various Parliament questions.

Dock Workers Safety Division

The office of the Chief Adviser of Factories, presently known as DGFASLI drafted the Indian Dock
Labourers Regulations,1948 under the Indian Labourers Act, 1934. The Chief Adviser of Factories
started administering the Regulations from 1948 in the five major ports of Mumbai, Kolkatta,
Chennai, Cochin and Visakhapatnam through the three inspectorates of Dock Safety set up in
Mumbai, Kolkatta and Chennai.

Besides these Regulations, the Dock Workers (Safety, Health &Welfare) Scheme,1961 framed under
the Dock Workers (Regulation of Employment) Act, 1948 was also enforced by the Inspectorate of
Dock Safety in the major ports. Subsequently, six more ports namely, Paradip, Turicorin, New
Mangalore, Mormugao, Kandla and Nhava-Sheva, renamed as Jawaharlal Nehru Port, were declared
as major ports.

Consequent to the recommendation of the First National Commission on Labour (Gajendranagar

Commission) a common comprehensive law on safety and health of dock workers titled the Dock
Workers (Safety, Health and Welfare) Act,1986 was framed and made applicable from 15th April
1987. Under this Act a set of comprehensive regulations called the Dock Workers (Safety, Health
and Welfare) Regulations 1990 was framed and brought into force with effect from 18th March 1990
and thereby repealing the earlier Regulations and Scheme. The new Act and Regulations are in line
with the ILO Convention 152 concerning safety and health in dock work. The Director General,
DGFASLI is the Chief Inspector of Dock Safety and the administration of these dock safety statutes
is carried out by the Ministry of Labour through DGFASLI, Mumbai

The DGFASLI is also entrusted with the responsibility of enforcing the Manufacture, Storage and
Import of Hazardous Chemicals Rules 1989 framed under the Environment(Protection) Act 1986, in
the port sector.

The main focus of the Dock Safety division is on:

Ashok Mammen V Assistant Professor Page 65

 Administering the Dock Workers (Safety, Health and Welfare) Act, 1986 and the Dock Workers
(Safety, Health and Welfare) Regulations 1990 framed there under involving administrative
approval of decisions arising out of enforcement of the Statutes by the Chief Inspector of Dock
Safety and fixing inspection priorities, etc. in all the eleven major ports.
 Proposing amendments to the existing Dock Safety Legislation
 Enforcing the Environment (Protection) Act and the Manufacture, Storage and Import of
Hazardous Chemicals Rules, 1989 framed there under and the Marking of Heavy Packages Act,
1951 and the Rules made there under
 Planning and policy making
 Advisory services to the Port Authorities, Dock Labour Boards, Stevedores and other employers
of dock workers.
 Organising international training programmes for port officials from developing countries.
 Publishing Annual Reports on the administration of the Dock Workers (Safety, Health and
Welfare) Act and the Regulations framed there under.

The enforcement function is carried out through the ten Inspectorates located at the major ports with
their regional inspectorates in Mumbai, Kolkata and Chennai. These Inspectorates of Dock Safety are
responsible for carrying out the following major activities.

(a) Enforcement:
 Inspection of ships, docks, loose gear, lifting appliances, transport equipment etc.
 Investigation of accidents
 Launching of prosecutions.

(b) Training:
 Carrying out safety studies and surveys through a multi-disciplinary approach
 Organising and conducting training courses on occupational safety and health

(c) Advisory Services:

Rendering Technical Advice to:
 The port authorities
 Other employers of dock workers
 Port users

(d) Safety Promotional activities:

 Organising/participating in safety promotional activities such as celebration of Dock Safety
Weeks
 Functioning as representatives of the Chief Inspector of Dock Safety on the Dock Safety
Committees at ports

Construction Safety

Ashok Mammen V Assistant Professor Page 66

The Construction Safety division undertakes activities like collection of data related to manpower,
accidents and dangerous occurrences in the construction sector of the country and training of
managerial and supervisory personnel at the national and international levels with the assistance of
international agencies, workers' and employers' associations.

Award Section
The Awards division operates the National safety Awards and the Vishwakarma Rashtriya Puraskar
of the Labour Ministry. There are two schemes of National Safety Awards which are presented to the
management of factories and ports for best safety performance. The "Vishwakarma Rashtriya
Puraskars" are given to employees of factories, plantations and ports for outstanding suggestions
made by them that have resulted in increased productivity, import substitution or higher efficiency.

MIS Division
The objective of the division is to provide information services on occupational safety and health,
function as a reference source and also as a center for dissemination of information, which will
contribute to the prevention of occupational accidents and [Link] division comprises of a
INDOSHNET centre, CIS National Centre for India and a Library-cum-Information Centre.

In order to achieve the above objectives, the division has taken up the following activities:

NATIONAL INVENTORY OF OSH INFORMATION:

This division is developing a National Inventory on OSH Information. As a beginning to this

inventory data has been collected from the state of Kerala. The major areas identified for the national
inventory of OSH information are :
 Demographic Details
 Geographical Structures
 Economic Sectors
 Manufacturing Activities
 Occupational Injuries & Diseases
 Management Of OSH at Unit & State Level
 Resources Available And Needed
The exercise is to be carried out in all the other states of the country so as to have a comprehensive
database on Inventory of OSH Information.

TRANSLATION OF INTERNATIONAL CHEMICAL SAFETY CARDS IN INDIAN

LANGUAGES:

The information on chemical safety is very vital and should be available with all the users handling
the hazardous chemicals. Taking into consideration the literacy level of the workforce, the division

Ashok Mammen V Assistant Professor Page 67

has taken up the task of translation of International Chemical Safety Cards in Indian languages. ICSC
cards in Hindi, Bangla & Tamil languages translated.

ABSTRACTS OF OSH LITERATURE:

The division has developed a user-friendly programme for Abstracts of OSH Literatures of the
studies:

 Surveys, Research studies, Consultancies & Research projects carried out by DGFASLI
organisation
 Project Reports of Diploma in Industrial Safety (DIS) students
 Project Reports Of Associate of Industrial Health (AFIH) Students
 OS&H literatures from other organisations in the country.

DATABASES ON OSH:
The division has developed the following databases along with application programmes.
 Current Events
 Hazop
 Parliament Questions And Replies
 Vishwakarma Rashtriya Puraskar
 Ship Inspection
 Competent Persons In Ports
 Flame Proof Equipment Certification
 Fasproforma
 MAH installations
 Hazardous Chemicals
 National Specialists

OSH INFORMATION DISSEMINATION

I.. INDOSHNEWS
This quarterly newsletter is intended to reach to the people round the globe and bring about
awareness in matters related to safety and health, highlight important issues, latest developments,
current events in the area of safety and health It includes abstract on material safety data sheets, book
reviews, finding of the studies and other relevant information on occupational safety and health
training programmes

CIS NATIONAL CENTRE FOR INDIA

As a CIS National Centre for India this Directorate provides information and services on:

 Microfiche reference

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 Awareness on current events
 Information access through CD-ROMs published by international agencies such as ILO, WHO,
etc.
 MSDS – made available to the industry on request
 DISPERSION MODELS - The center provides support for developing dispersion models of
accident release of gases and chemicals

LIBRARY-CUM-INFORMATION CENTRE
The library has about 20,000 titles on various disciplines dealt with by the institute. Several Indian
and foreign journals are also available in the library. The library is referrred to by the people from
industry, post-graduate students and of professional courses besides the faculty of the institute

IV. EMPLOYEES‟ STATE INSURANCE ACT, 1948

An Act to provide for certain benefits to employees in case of sickness, maternity and
employment injury and to make provision for certain other matters in relation thereto

The Employees State Insurance Act, ESI Act, was enacted by the Government of India in 1948.
The ESI Act, 1948 in the first instance, applies to:
- Factories using power in the manufacturing process and employing 10 or more persons
- Non-power using factories or establishments employing 20 or more persons for wages.
- The Act contains an enabling provision under which Appropriate Government is empowered
to extend the provision of the ESI Act, 1948 to other classes of establishments.
Industrial, Commercial, Agricultural or otherwise.

- Under these provisions the State Governments have extended the provisions of the ESI Act to
the following classes of establishments.
Shops, Hotels & Restaurants, Cinemas including preview Theaters, Road Motor
Transport Undertaking, News Paper Establishments

Wage Limit
The Government of India through notification in the Official Gazette has amended the
Employees‟ State Insurance (Central) Rules, 1950. Accordingly, as per rule 50, the wage limit
for coverage of an employee under Employees State Insurance Act has been enhanced from Rs.
10,000 to Rs. 15,000 with effect from 1st May 2010.

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Contribution
ESI scheme is financed by contribution raised from employees covered under this scheme and
their employers as a fixed percentage of wages. Rates of contribution (before 1/07/2019)are as
follows:
- Employees contribution 1.75% of wages ( Employees earning up to Rs. 50 per day are
exempted from payment of their contribution)
- Employer‟s contribution 4.75% of wages.

On 13/6/19 the ESI Corporation notified new contribution rates w.e.f July 1, 2019

For example a worker earning

wages of Rs. 10,000/-
1 Employee contribution 0.75% 75
2 Employer contribution 3.25% 325
3 Total contribution 4.00% 400

** the state government contributes 1/8th share of the cost of medical benefits.

The section 46 of the Act envisages following six social security benefits :-

(a) Medical Benefit

Full medical care is provided to an Insured person and his family members from the day he
enters insurable employment. There is no ceiling on expenditure on the treatment of an Insured
Person or his family member. Medical care is also provided to retired and permanently disabled
insured persons and their spouses on payment of a token annual premium of Rs.120/- .

(b) Sickness Benefit (SB)

Sickness Benefit in the form of cash compensation at the rate of 70 per cent of wages is payable
to insured workers during the periods of certified sickness for a maximum of 91 days in a year.
In order to qualify for sickness benefit the insured worker is required to contribute for 78 days in
a contribution period of 6 months.
i. Extended Sickness Benefit(ESB) : SB extendable upto two years in the case of 34
malignant and long-term diseases at an enhanced rate of 80 per cent of wages.
ii. Enhanced Sickness Benefit : Enhanced Sickness Benefit equal to full wage is payable to
insured persons undergoing sterilization for 7 days /14 days for male and female workers
respectively.

(c) Maternity Benefit (MB) Maternity Benefit for confinement/pregnancy is payable for Twenty
Six (26) weeks, which is extendable by further one month on medical advice at the rate of full
wage subject to contribution for 70 days in the preceding Two Contribution Periods.

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(d) Disablement Benefit

i. Temporary disablement benefit (TDB) : From day one of entering insurable employment &
irrespective of having paid any contribution in case of employment injury. Temporary
Disablement Benefit at the rate of 90% of wage is payable so long as disability continues.
ii. Permanent disablement benefit (PDB) : The benefit is paid at the rate of 90% of wage in
the form of monthly payment depending upon the extent of loss of earning capacity as
certified by a Medical Board

(e) Dependants Benefit (DB)

DB paid at the rate of 90% of wage in the form of monthly payment to the dependants of a
deceased Insured person in cases where death occurs due to employment injury or occupational
hazards.

(f) Other Benefits :

Funeral Expenses : An amount of Rs.15,000/- is payable to the dependents or to the person who
performs last rites from day one of entering insurable employment.

Confinement Expenses : An Insured Women or an I.P. in respect of his wife in case confinement
occurs at a place where necessary medical facilities under ESI Scheme are not available.

In addition, the scheme also provides some other need based benefits to insured workers.

- Vocational Rehabilitation :To permanently disabled Insured Person for undergoing VR

Training at VRS.
- Physical Rehabilitation: In case of physical disablement due to employment injury.
- Old Age Medical Care: For Insured Person retiring on attaining the age of superannuation
or under VRS/ERS and person having to leave service due to permanent disability insured
person & spouse on payment of Rs. 120/- per annum.

Rajiv Gandhi Shramik Kalyan Yojana

This scheme of Unemployment allowance was introduced w.e.f. 01-04-2005. An Insured Person
who become unemployed after being insured three or more years, due to closure of
factory/establishment, retrenchment or permanent invalidity are entitled to :-

- Unemployment Allowance equal to 50% of wage for a maximum period of upto Two Years.
- Medical care for self and family from ESI Hospitals/Dispensaries during the period IP
receives unemployment allowance.
- Vocational Training provided for upgrading skills - Expenditure on fee/travelling allowance
borne by ESIC.

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Atal Beemit Vyakti Kalyan Yojana
This scheme is a welfare measure for employees covered under Section 2(9) of ESI Act, 1948, in
the form of cash compensation upto 90 days, once in a lifetime, to be claimed after three months
in one or more spells for being rendered unemployed, provided the employee should have
completed two years of insurable employment and has contributed not less than seventy eight
(78) days in each of the four consecutive contribution periods immediately preceding to the
claim of the relief. The relief shall not exceed twenty five percent (25%) of the average earning
per day.
The Scheme was introduced w.e.f. 01-07-2018. The scheme is implemented on pilot basis for a
period of two years initially.

Incentive to employers in the Private Sector for providing regular employment to the
persons with disability :

- Minimum wage limit for Physically Disabled Persons for availing ESIC Benefits is 25,000/-.
- Employers' contribution is paid by the Central Government for 3 years.

Benefits & Contributory Conditions :

An interesting feature of the ESI Scheme is that the contributions are related to the paying
capacity as a fixed percentage of the workers' wages, whereas, they are provided social security
benefits according to individual needs without distinction.
Cash Benefits are disbursed by the Corporation through its Branch Offices (BOs) / Pay Offices
(POs), subject to certain contributory conditions.

Safeguard For Insured Employees

- Right to receive payment of any benefit under the Act are not transferable.
- Employer shall not dismiss, discharge or reduce the wages or otherwise punish a covered
employee during the period he/she is in receipt of Sickness Benefit or Maternity Benefit etc.
- By reason of his liability to pay his share of contribution under the ESI Act, no employer
shall directly or indirectly reduce the wages of a covered employee.
- Right to register their grievances / complaints at any level for immediate re-dressal.
- Right to approach ESI Court against any action/decision of the Medical Board etc
- Cash Benefits payable under the Act are not liable to attachment or sale in execution of any
decree or order of any court

Duties Of Employer

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- An employer shall apply in Form-01 for coverage under the ESI Act, within 15 days after the
Act becomes applicable to a factory or establishment.
- The employer shall submit Declaration Form in respect of all coverable employees in the
unit.
- The employer shall deposit both employees‟ and employers‟ contribution as per specified
rates within 21 days of the following month.
- The Employer shall maintain all such records and registers as are required under the Act and
produce them for verification / inspection before the authorised officers of the Corporation.
- The employer shall submit half-yearly Return of Contributions (RC) by
12thMay/11th November every year with all columns properly filled.
- The employer will report any change in business activity, address, ownership or the
management to ESIC authorities forthwith.
- An employer will also ascertain the liability towards ESI dues, while taking over the
ownership of a factory/establishment through purchase, gift, lease, licence or otherwise as the
new owner is liable to discharge past liabilities.
- An employer will also ascertain the liability towards ESI dues, while taking over the
ownership of a factory / establishment through purchase, gift, lease, licence or otherwise as
the new owner is liable to discharge past liabilities.

Scale Of Medical Benefit

The scale of Medical Benefit under section 57 of Act to be provided to the IPs and members of
their families is to be prescribed by State Government in consultation with the Corporation under
Section 58(1 & 3) of Act under State Medical Benefit Rules. An IP and/or a member of his
family does not have the right to claim Medical Services over and above those which have been
so prescribed. The beneficiaries are entitled to reasonable medical, surgical and obstetric
treatment.
a. To Insured Persons:- IPs are entitled to avail treatment in ESI
Dispensary/Hospital/Diagnostic Centre and recognised institutions, to which he is attached
such as:-

- Outpatient treatment
- Domiciliary treatment by visits at their residences.
- Specialists Consultation.
- In-patient treatment(Hospitalisation)
- Free supply of drugs dressings and artificial limbs, aids and appliances.
- imaging and laboratory services.
- Integrated family welfare, immunisation and MCH Programme and other national health
programme etc.
- Ambulance service or re-imbursement of conveyance charges for going to hospitals,
diagnostic centres etc.

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- Medical Certification and
- Special provisions.

b. To Family Members of Insured Persons:- While in all implemented areas, IPs are entitled to
medical care as detailed above, members of a family of an IP are entitled to one or other of
the family member of the insured person is eligible to take one or other medical under the
following standards :-

- "FULL" Medical Care i.e., all facilities as for IPs including hospitalisation.
- "EXPANDED" Medical Care i.e., all facilities as for IPs except hospitalisation. A small
number of IPs in the States of Gujarat and Bihar fall under this category.

The Corporation aims at providing Medical care according to uniform standards to the Family
members in all implemented areas as the rates of the contribution paid by the employees and the
employers are the same throughout the country.

V. EMPLOYEES' PROVIDENT FUND ORGANISATION, INDIA

EPFO is one of the World's largest Social Security Organisations in terms of clientele and the
volume of financial transactions undertaken. The Annual Report 2015-16 states that 17.14 crores
member accounts are maintained by EPFO. The Employees' Provident Fund came into existence
with the promulgation of the Employees' Provident Funds Ordinance on the 15th November,
1951. It was replaced by the Employees' Provident Funds Act, 1952. The Employees' Provident
Funds Bill was introduced in the Parliament as Bill Number 15 of the year 1952 as a Bill to
provide for the institution of provident funds for employees in factories and other establishments.
The Act is now referred as the Employees' Provident Funds & Miscellaneous Provisions Act,
1952 which extends to the whole of India except Jammu and Kashmir. The Act and Schemes
framed there under are administered by a tri-partite Board known as the Central Board of
Trustees, Employees' Provident Fund, consisting of representatives of Government (Both Central
and State), Employers, and Employees.

The Central Board of Trustees administers a contributory provident fund, pension scheme and an
insurance scheme for the workforce engaged in the organized sector in India. The Board is
assisted by the Employees' Provident Fund Organisation (EPFO), consisting of offices at 135
locations across the country. The Organization has a well equipped training set up where officers
and employees of the Organization as well as Representatives of the Employers and Employees
attend sessions for trainings and seminars.

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The Board operates three schemes - EPF Scheme 1952, Pension Scheme 1995 (EPS) and
Insurance Scheme 1976 (EDLI).

 The scheme covers every establishment in which 20 or more persons are employed and
certain organisations are covered, subject to certain conditions and exemptions even if they
employ less than 20 persons each.
 Under EPF scheme, an employee has to pay a certain contribution towards the scheme and an
equal contribution is paid by the employer.
 The employee gets a lump sum amount including self and employer‟s contribution with
interest on both, on retirement.
 As per the rules, in EPF, employee whose „pay‟ is more than Rs. 15,000 per month at the
time of joining, is not eligible and is called non-eligible employee. Employees drawing less
than Rs 15000 per month have to mandatorily become members of the EPF. However, an
employee who is drawing „pay‟ above prescribed limit (at present Rs 15,000) can become a
member with permission of Assistant PF Commissioner, if he and his employer agree.

1. Contribution by employer and employee

 The contribution paid by the employer is 12% of basic wages plus dearness allowance plus
retaining allowance.
 An equal contribution is payable by the employee also. In the case of establishments which
employ less than 20 employees or meet certain other conditions, as per the EPFO rules, the
contribution rate for both employee and the employer is limited to 10 percent.
 For most employees of the private sector, it‟s the basic salary on which the contribution is
calculated. For example, if the monthly basic salary is Rs 10,000, the employee contribution
towards his or her EPF would be Rs 1,200 a month ( 12 percent of basic pay) while the equal
amount is contributed by the employer each month.
 Out of employer‟s contribution, 8.33% will be diverted to Employees‟ Pension Scheme, but
it is calculated on Rs 15,000. So, for every employee with basic pay equal to Rs 15,000 or
more, the diversion is Rs 1,250 each month into EPS. If the basic pay is less than Rs 15000
then 8.33% of that full amount will go into EPS. The balance will be retained in the EPF
scheme. On retirement, the employee will get his full share plus the balance of Employer‟s
share retained to his credit in EPF account.

2. Higher voluntary contribution by employee or Voluntary Provident Fund .

 The employee can voluntarily pay higher contribution above the statutory rate of 12 percent
of basic pay. This is called contribution towards Voluntary Provident Fund (VPF) which is
accounted for separately. This VPF also earns tax-free interest. However, the employer does
not have to match such voluntary contribution.

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3. Withdrawals from the EPF account.
 According to the EPF Act, for claiming final PF settlement, one has to retire from service
after attaining 55 years of age. The total EPF balance includes the employee‟s contribution
and that of the employer, along with the accrued interest. There is, however, a window to
partially withdraw the amount for those nearing retirement.
 Anyone over 54 can withdraw up to 90 percent of the accumulated balance with interest.
 If someone decides to quit his job before reaching 55? Under the existing rule, the
employees, in such cases, can withdraw the full PF balance if he is out of employment for 60
straight days or more.
 To withdraw money, one may now use „UAN based Form 19‟ and in effect bypass the
employer signature requirement. This facility will be available to all those subscribers whose
UAN is activated and seeded with the KYC details like bank account and Aadhaar number.
Currently, the form has to be submitted offline, but the EPFO is expected to extend this
facility online too.

4. Interest on account
 The Interest in EPF is calculated on the basis of monthly running balance.
 As per the recent government notification on 24th September 2019, the EPF interest rate is
8.65% for the year 2018-19. In 2017-18, the EPF interest rate was 8.55 percent.

5. Universal Account Number

UAN stands for Universal Account Number to be allotted by EPFO. The UAN will act as an
umbrella for the multiple Member IDs allotted to an individual by different establishments. The
idea is to link multiple Member Identification Numbers (Member Id) allotted to a single member
under single Universal Account Number.

UAN will help the member to view details of all the Member Identification Numbers (Member
Id) linked to it. If a member is already allotted (UAN then he/she is required to provide the same
on joining new establishment to enable the employer to in-turn mark the new allotted Member
Identification Number (Member Id) to the already allotted Universal Identification Number
(UAN).

UAN has been made mandatory for all employees and will help in managing the EPF account
and even PF transfer and withdrawals will become much easier than before. Remember, in most
cases, the employer provides the UAN and the employee just has to get it activated by providing
relevant KYC documents to the employer. So if you are changing jobs and already have a UAN,

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you need not get a new UAN from your new employer. It is a one-time permanent number which
will remain the same throughout one‟s career.

When you join a new organisation, the first thing you should do is ask your employer for the
„New Form No. 11- Declaration Form‟ to furnish the existing UAN. If you don‟t have one, then
just give your previous PF number along with the date of exit from your previous job.

6. The importance of five years of continuous service

Typically, in early and mid-years of their careers, employees tend to switch jobs. After leaving,
they have two options with regard to their EPF. Either they can withdraw it after waiting for 60
days (if unemployed) or transfer the balance to the new employer.

The EPF withdrawal is not taxable if one has completed at least five years of continuous service.
If one has switched jobs in less than five years but transferred the EPF to the new employer, it
will be counted as continuous service. Someone, for instance, works for 1.5 years and then joins
another organisation. He transfers his PF balance on to the new employer where he continues to
work for 3.5 years. Taken together, it will be five continuous years of service for the employee.
It is, therefore, better to transfer your existing PF to your new employer.

7. Tax on early withdrawals

Withdrawing the PF balance without completing five continuous years of service has tax
implications. The total employer‟s contribution amount along with the interest earned will get
taxable in the year of withdrawal. Also, the amount of deduction claimed under Section 80C on
one‟s own contribution will be added to one‟s income in the year of withdrawal. In addition, the
interest earned on one‟s own contribution will also be subject to tax.

The government had introduced Tax Deducted at Source (TDS) on PF withdrawals in order to
discourage premature withdrawals and promote long-term savings. No tax is deducted if the
employee withdraws PF after five years. Also, TDS shall not be applicable in case of PF transfer
from one account to another. From June 1, 2016, for TDS, the threshold limit of PF withdrawal
has been raised from Rs 30,000 to Rs 50,000. TDS will be applicable at the rate of 10 per cent
provided PAN card is submitted.

8. Employees' Provident Fund Advances

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Contributions towards Employees' Provident Fund (EPF) are meant to take care of one‟s post-
retirement needs. The EPFO allows one to access one‟s EPF even during the course of
employment. Such withdrawals are treated as „advances‟ and not loans.

Such advances are allowed only under specific situations – buying a house, repaying a home
loan, medical needs, education or marriage of children, etc. Also, the amount that you can take as
an advance will depend on the specific situation, the number of years of service, etc. As it‟s not a
loan, one need not pay any interest on such advances. Unlike a loan, it is not necessary to repay
the advance.

9. Availing advances
If you have your Know Your Customer (KYC) compliant Universal Account Number (UAN),
which is activated and seeded to your bank account, you don‟t have to even go through your
employer to get hold of your EPF. The UAN Based Form 31 (New) can be directly submitted to
the EPFO. Else, you may fill in Form 31 and submit it to the EPFO through your employer.

The employee can take the advance for buying or building a house or buying a plot of land and
even for construction of a house on a plot owned by the member. The advance can also be taken
for repayment of the outstanding home loan, for self or family member‟s medical treatment, for
the marriage of self/daughter/son/ brother/sister or for post matriculation education of
son/daughter.

10. Special advance scheme for housing

EPFO has recently allowed members i.e. the contributory employees of the provident fund (PF)
scheme to use 90 percent of EPF accumulations to make down payments to buy houses and use
their accounts for paying EMIs of home loans.

Under the new rules, an essential requirement for a PF member to withdraw one‟s PF money to
buy a real estate property is that he or she has to be a member of a registered housing society
having at least 10 members. As a member, one can use the PF funds for an outright purchase, as
a down payment for a home loan, for buying plots, for the construction of a house. The
transactions can be made through central government, state government and even from a private
builder, promoters or developers. Only those members who have completed 3 years as a PF
member will be eligible for this scheme.

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11. Conclusion
As per the recent government notification on 24th September 2019, the EPF interest rate is
8.65% , for the year 2018-19. In 2017-18, the EPF interest rate was 8.55 percent. In terms of
returns from a debt instrument, EPF certainly stands tall. The money is sovereign-backed and the
interest earned is tax-free. In fact, it enjoys the Exempt, Exempt, Exempt (EEE) status as
contributions are deductible from income. There is hardly any debt product that gives such high
return with safety and assurance. Therefore, it‟s better to transfer your PF account when you
switch job ..

VI. CENTRAL BOARD FOR WORKERS EDUCATION (CBWE)

The Central Board for Workers Education (CBWE) is an autonomous body under the Ministry of
Labour & Employment, Government of India. It is registered under the Societies Registration
Act, 1860. Started in 1958, the Workers Education Scheme in India has been playing a very
significant role in our national development; creating an enlightened and disciplined work force
and bringing about desirable behavioral changes in our workforce in the organized, unorganized
and rural sectors. It gets grants-in-aid from the Ministry of Labour & Employment to operate its
activities. The Scheme of Workers Education aims at achieving the objectives of creating and
increasing awareness and educating the workforce for their effective participation in the socio-
economic development of the country. To achieve these objectives, various training programmes
are conducted by the Board for the workers of formal and informal sectors at national, regional
and unit levels through a network of 50 Regional and 09 Sub-Regional Directorates spread all
over the country and an apex Training Institute viz. Indian Institute of Workers Education
(IIWE) at Mumbai.

Objectives of CBWE

 To strengthen among all sections of the working class, including rural workers, a sense of
patriotism, national integrity, unity, amity, communal harmony, secularism and pride in
being an Indian.
 To equip all sections of workers, including rural workers and women workers, for their
intelligent participation in social and economic development of the nation in accordance
with its declared objectives.
 To develop amongst the workers a greater understanding of the problems of their social
and economic environment, their responsibilities towards family members, and their
rights and obligations as citizens, as workers in industry and as members and officials of
trade union.
 To develop capacity of workers in all aspects to meet the challenges of the country from
time to time.

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  To develop strong, united and more responsible trade unions and to strengthen
democratic processes and traditions in the trade union movement through more
enlightened members and better trained officials.
 To empower the workers as employees of the organization and to develop sense of
belongingness as effective instruments of amicable industrial relations and maintaining
industrial peace.
 To meet the needs of workers to have access to ways of acquiring and continuous up
gradation of knowledge and skills that they require to find and hold a job.

Important Activities /Schemes :

Initially the Board‟s activities were concentrated on educating the workers employed in the
organised sector. However, as recommended by the Workers Education Review Committee and
agreed by the Govt. of India, the Board shifted its emphasis from organised sector to the
education of workers in rural sector. Starting with seven pilot projects since 1977-78, the rural
workers education of the Board has become a regular, continuing and countrywide programme.
However the role of the Central Board for Workers Education is mainly educational and
motivational through dialogic process to equip rural workers to appreciate and analyse their
socio-economic problems through organised action. The categories of workers covered in these
rural programmes are in conformity with ILO Convention No. 141 and Recommendation No.149
on rural workers.

Further the Board took initiative to educate the workers of Unorganised and Small Scale Sector
industries since 1979 with a view to develop awareness about their problems, difficulties and
protective labour laws at work place and help them in finding solutions as well as equip them in
developing and strengthening their own organisations. The Board publishes simple literature and
study material in form of textual and pictorial booklets in English and Indian Languages in a
lucid style on subjects such as Trade Unionism, Labour-Management Relations, Labour
Economics, Labour Laws, Population and Family Welfare etc., To sustain the interest of
participants in the class and also to make teaching more interesting, the Board has brought out
various types of audio-visual aids such as posters, flipcharts, flannel graphs, posters, stickers etc.,
on different themes. Also the Board conducts the training programmes at the national, regional
and unit/village levels. The Board has recently launched a new programme "Quality of Life for
Workers and their Spouses" with a view to mould their attitudes, develop motivation, build up
personality, raise family status, maintain good neighbourhood relations, develop awareness about
environmental cleanliness, develop a spirit of team work, human relations, productivity
consciousness, commitment to discipline, mutual trust and hygiene etc.

The Broad Structure of the Organisation :

1. The Members of the Society ( Board) include the Chairman,(nominated by the Govt. of India
), Representatives of Workers, Employers, Government ( both Central and State ) and
Educational Bodies.
2. The Director of the Board is the Member Secretary and Principal Executive Officer.

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3. The affairs of the Board are managed by a Governing Body elected annually from amongst
the members of the Board.

According to CBWE, Workers Education covers a whole range of skills and knowledge, which
contribute to the harmonious development of a worker‟s personality, his role in the society and
the knowledge and attitudes required for such roles. Education does not mean merely literacy,
but also should enable an individual to understand his/her responsibility towards family, work
place, society and nation. Empowerment of workers is an essential component of Workers
Education as the functioning and ultimate results achieved of any organization depends mostly
on its workers.

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