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INDEX

SECTION A (600 points)


1.
Factories Act/Rules
2.
Contract Labour Act/Rules
3.
Shops & Establishment Act/Rules
4.
PF Act/Rules
5.
Employees Pension Scheme
6.
ESI Act/Rules

300 points
130 points
60 points
40 points
30 points
40 points

SECTION B (180 points)


1.
2.
3.
4.
5.
6.
7.

Payment of Wages Act/Rules


Minimum Wages Act/Rules
Payment of Bonus Act/Rules
Payment of Gratuity Act/Rules
The Indl. Employment Standing Orders Act/Rules
Air/Water Pollution Act/Rules
Prevention of Food & Adulteration Act/Rules

40 points
20 points
30 points
35 points
15 points
30 points
20 points

SECTION C (90 points)


1.
2.
3.
4.
5.
6.
7.

Maternity Benefit Act/Rules


Apprentices Act/Rules
National & Festival Holidays Act/Rules
Employment Exchange (CNV) Act/Rules
Equal Remuneration Act/Rules
Workmens Compensation Act/Rules
Labour Welfare Fund Act/Rules

15 points
15 points
15 points
10 points
5 points
10 points
10 points

SECTION D (130 points)


1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

Petroleum Act/Rules
Boilers Act/Rules
Indian Explosives Act/Gas Cylinder Rules
Indian Electricity Act/Rules
The Environment Protection Act/Rules
The Fertilizer (Control) Order
VOP (Standars of Quality) Order/
Solvent Extracted Oil Rule
Drugs Control Order
Municipal Act/Rules Licences, etc.
Standards of W & M (PCRO) Act/Rules

10 points
10 points
10 points
10 points
20 points
10 points
10 points
10 points
20 points
20 points

GUIDELINES FOR RATING DURING CROSS AUDIT OF LEGAL ISSUES BY PERSONNEL


MANAGERS
SECTION A Act/Rules should be complied for Factory Operations 600 points
1.

Factories Act/Rules 300 points


S.No.

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24

Description
Is Approved site/building plans & layout of machineries
available?
Have we obtained Factory licence/renewed every year?
Have we complied with Declaration of Occupier/Notice of
Change of Occupier?
Have we displayed Notice of change of Manager in Form
3A
Are we maintaining Whitewashing/painting registers
registers?
Have we obtained approval from Pollution Control Board
for disposal of waste and effluents?
Are we providing cool drinking water if more than 250
employees and the portability has been tested or not?
Have we provided Latrine & Urinals as per the
provisions?
Have we provided drainage facilities in the factory?
Are the Spittoons provided with adequate numbers
Are the prime moving items properly guarded and the
pressure plants are examined by competent
person/obtained certificate/maintaining register
Have
we
obtained
Testing
certificate
of
compressors/lifting tackles/hoists?
Have we obtained Stability Certificate for buildings?
Have we exhibited Fire Safety plan of the factory
Have we provided Fire Fighting equipments/fire
buckets/hydrants as per the Factories Act?
Have we ensured that 1/4th of the employees of the unit
are trained in handling fire fighting equipments?
Are the fire exits provided and marked properly for easy
identification?
Are we conducting mock fire drill once in a year?
Have we provided automatic fire alarm if more than 500
employees and manual alarm if more than 25
employees?
Are the employees trained in first aid and their names
exhibited?
Are we maintaining First aid box with required
medicines/equipments?
Is Canteen provided if more than 250 employees and
run on no profit no loss basis?
Is the Canteen building situated 15.2 mtrs away from
Latrine/Boiler house etc. which is approved by Chief
Inspector of Factories?
Is Canteen Committee managing Canteen & maintaining
Minutes of Meeting?

Maximum
Marks
15
20
10
5
5
10
5
5
5
5
10
5
5
5
5
5
5
5
5
5
5
10
10
5

Marks
Obtained

25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43

2.

2
3
4
5
6
7

Have we displayed the abstract of Factories Act/Rules


near entrance?

5
15
5
5
10
10
5
5
10
5
5
5
5
5
5
5
5
5
10

Contract Labour Act/Rules 130 points


S.No.

Are we maintaining Register of adult workers/compulsary


holidays?
Do we comply with working hours/overtime
rules/maintaining OT register/Compensatroy Off
Register?
Have we displayed the periods of notice of work?
Are we maintaining Register of leave with wages/leave
book?
What was the loss time accidents (LTA) in the last two
years and has it been investigated to avoid future
accidents?
Are we maintaining accident reports/registers/records?
Do we have Safety Officer if more than 1000 employees
Is regular Safety Committee Meeting takes place/Minutes
maintained?
Are we submitting half yearly/yearly returns regularly to
Inspector of Factories?
Is the factory declared as No Smoking Zone and strictly
enforcing it?
Have we obtained Nomination for disbursing wages in
case of death?
Have we conducted Vision test for forklift
drivers/electricians?
Are we having Occupational Health Centre with part time
Doctor if less than 200 employees?
Have we given a copy of the health & safety policy to
employees
Is Ambulance provided if more than 500 employees and
a full time Doctor with qualified compounders
Are we carrying out Medical examination of employees
once in six months and maintaining the register in Form17
Have we exhibited Health & Safety/environment policy of
factory in the notice board?
Are we keeping the records for 3 years for inspection?

Description
Has the unit obtained Registration Certificate for
engaging Contract Labour?
Do we maintain Registers of Contractors?
Have we ensured that the contractors obtain Licence
even if the number is less than 20?
Do we ensure that the Contractors renew their Licence
every year?
Have they taken Separate code number for PF and ESI
coverage and contributions are remitted accordingly?
Do the Contractors
maintain attendance/wages
registers/register of advance?
Do the Contractors maintain Register of persons
employed by them?

Maximum
Marks
15
5
15
4
10
5
5

Marks
Obtained

8
9
10
11

12
13
14
15
16
17
18
19
20
21

3.

Are we ensuring submission of annual returns by


principal employer?
Have we displayed the abstract of the Contract Labour
Act/Rules?
Do we ensure that the contract labour usage is as per
Annexure -1?

5
5
5

5
5
5
5
5
5
5

5
5

Shops & Establishments Act/Rules - 40 points


S.No.

Description
Have we obtained Registration Certificate/Renewed
every year?
Are we maintaining Register of establishment?
Are we maintaining attendance/wages register/leave with
wages register/ overtime register/fines/deductions?
Do we ensure that the daily hours do not exceed 9
hrs/weekly 48 hours of work and declare ten holidays
including 5 National Holidays?
Are we giving one full day as a weekly holiday?
Do we ensure proper cleanliness/safety/lighting facility in
work place?
Are we submitting half yearly/annual returns?
Have we exhibited the abstract of the Act/Rules?

2
3
4
5
6
7
8

4.

Maximum
Marks
5

Marks
Obtained

5
5
5
5
5
5
5

PF Act/Rules 40 points
S.No.

Are the Contractors keeping the registers/records


relevant to the employment 3 kms nearer to the work
place?
Do
the
Contractors
maintain
Register
of
fines/deductions/overtime?
Do the Contractors issue Service Certificate to their
workers on termination?
Have they displayed Notice showing rates of
wages/hours of work/wage period/date of payment of
wages/date of payment of unpaid wages & the name and
address of the Inspector having jurisdiction over the Unit?
Have they displayed Name and address of the Inspector
having jurisdiction
Have they issued Employment Card/Wage slips to their
workers?
Do we ensure that the payment of wages is witnessed by
Management Representative?
Are the contract employees covered under ESI/WC Act?
Have we entered into legal agreement with the
Contractors
Are we ensuring that the canteen facility is provided if
more than 100 persons employed?
Are we ensuring submission of half yearly returns by
contractors?

Description
Have we obtained separate Code Number for the Unit?

Maximum
Marks
5

Marks
Obtained

Have we ensured coverage of all employees under PF @


12%?
Have we obtained PF Nomination in Form-2 from the
employees?
Are we submitting monthly/annual returns promptly?
Do we disburse yearly PF statements to the employees?
Do we ensure settlement of PF dues on the day
separation/retirement?
Are we maintaining Inspection Book?
Have we supplied PF passbooks to the employees?

3
4
5
6
7
8
5.

Description
Are we depositing Contribution of 8.33% from PF under
EPS?
Have we obtained Nomination Forms from employees?
Are we submitting Return on No. of persons joined/left in
the Scheme every month?
Are we ensuring settlement of pension to all the eligible
employees?
Are we submitting annual statement of contributions to
RPFC?
Do we have the list of active members/non-members in
EPS?

2
3
4
5
6

Description

Have we obtained Registration of the Unit and Code


Number?
Are we ensuring coverage of all employees under ESI
Scheme if applicable and have they been given ID
Cards?
Are we reporting the accidents & maintaining accident
register?
Are we maintaining Register of employees?
Are we ensuring that the contributions are remitted within
21 days of closing the month?
Are we submitting monthly/half yearly/yearly returns
regularly?
Have we displayed the abstract of the ESI Act/Rules?

Are we maintaining Inspection Book?

2
3
4
5
6

5
5
5
5
5

Maximum
Marks
5

Marks
Obtained

5
5
5
5
5

ESI Act/Rules 40 points


S.No.

Employees Pension Scheme 30 points


S.No.

6.

Maximum
Marks
5
5
5
5
5
5
5
5

Marks
Obtained

SECTION B Act/Rules Must be complied - - 190 points


1.

Payment of Wages Act/Rules - 30 points


S.No.

Have we exhibited in vernacular on the rate of wages for


different categories of employees and the date of
disbursement?
Are we maintaining Register of wages/issuing wage slips
to employees?
Are we maintaining Register of advances/deductions?
Are we maintaining Register of fines?
Are we submitting Annual Returns regularly?
Have we displayed the abstract of the Act/Rules?

2
3
4
5
6

2.

3.

5
6

Marks
Obtained

5
5
5
5
5

Maximum
Marks
5

Marks
Obtained

5
5
5
5
5

Payment of Bonus Act/Rules - 30 points


S.No.

Description
Do we ensure that the minimum wages are paid as per
the Govt. Notification and do we have anybody being
paid less than minimum wages?
Are we issuing Wage Slips?
Are we maintaining Register of Wages?
Are we maintaining Muster Roll Register?
Are we submitting Annual Returns?
Have we displayed the abstract of the Act/Rules?

2
3
4
5
6

2
3

Maximum
Marks
5

Minimum Wages Act/Rules - 30 points


S.No.

Description

Description
Do we ensure maximum of Rs.3,500/- for bonus
eligibility?
Are we maintaining Form A & B for Allocable Surplus?
Are we maintaining Form C for bonus amount paid to
employees?
Are we ensuring that the Bonus is paid to everyone who
have worked for 30 days & above?
Are we submitting Annual Returns to appropriate
authority in Form D?
Have we displayed the abstract of the Act/Rules?

Maximum
Marks
5
5
5
5
5
5

Marks
Obtained

4.

Payment of Gratuity Act/Rules


S.No.

Description
Have we ensured Notice in Form A regarding
opening/change/closure of the Unit?
Have we obtained Nomination from employees in Fomr-F
and deposit gratuity with Appr.Auth. in case of no
nomination?
Do we ensure that the gratuity is paid if 5 years of
continuous service is rendered and do we settle gratuity
within 30 days?
Are we ensuring that the gratuity is calculated based on
26 days wages?
Have we displayed the Notice of person authorised to
receive notices and displayed the abstract of the
Act/Rules?

2
3
4
5

5.

- 35 points

Description
Are we displaying Certified Standing Orders in English &
vernacular if more than 100 employees?
Are we following/exhibiting the Model Standing Order if
less than 100 employees?

6.

Description

1
2

Have we obtained consent & renew it every year?


Are we submitting annual returns to the Pollution Control
Board?

7.

Prevention of Food & Adulteration Act/Rules - 20 points


S.No.

10
5
10
5

Maximum
Marks
10

Marks
Obtained

Air Pollution/Water Pollution Act/Rules - 30 points


S.No.

Marks
Obtained

The Indl. Employment Standing Orders Act/Rules 15 points


S.No.

1
2

Maximum
Marks
5

Description
Have we obtained the PFA Licence/renewed every year?
Do we inform the change in nomination to the appropriate
authority?
Are we maintaining the register on the stocks
manufactured/sold?
Are we keeping the damaged stock separately with the
Board damaged stock not for sale ?(

Maximum
Marks
20
10

Marks
Obtained

Maximum
Marks
5
5

Marks
Obtained

5
5

SECTION C Acts/Rules to be complied - 80 points


1.

Maternity Act/Rules - 15 points


S.No.

Are confirmed women employees given 12 weeks


maternity leave?
Are we giving 6 weeks leave maternity benefit for
miscarriage?
Are we maintaining women employees register?
Are we submitting Annual Returns?
Have we displayed the abstract of the Act/Rules?

2
3
4
5
2.

3
4

Description
Have we displayed the paid Holidays notice duly
approved by the Labour/Factory Inspector

3
3
3
3

Maximum
Marks
5

Marks
Obtained

3
3
4

Maximum
Marks
10

Marks
Obtained

Employment Exchange (Compul. Notifi. of Vacancies) Act/Rules - 5 points


S.No.

Description
Have we ensured submission of quarterly returns within
30 days after the quarter/submission of biennial returns
once in 2 years?

5.

Maximum
Marks
5

Marks
Obtained

Maximum
Marks
5

Marks
Obtained

Equal Remuneration Act/ Rules - 10 points


S.No.

Marks
Obtained

National & Festival Holidays Act - 10 points


S.No.

Description
Are we maintaining Registration of contracts of
apprenticeship?
Are we maintaining particulars of Apprentices and their
progress report?
Are we ensuring that the Apprentices are paid as per
Act?
Are we submitting Half Yearly/Annual Returns?

4.

Maximum
Marks
3

Apprentices Act/Rules - 15 points


S.No.

3.

Description

Description
Have w ensured equal work equal pay for men &
women?
Have we maintained the Register in Form D?

6.

Workmens Compensation Act/Rules - 10 points


S.No.

Have we ensured aubmission of Annual Returns?

Maximum
Marks
5

Have we exhibitited the abstract of the Act/Rules?

7.

Description

Labour Welfare Fund Act/Rules


S.No.

10 points

Description
Have we ensured deduction of contribution of Welfare
Fund and remitted with the details once a year?
Have we remitted the unpaid wages/other payments in
Labour Welfare Fund as per the Act?

8.

Marks
Obtained

Maximum
Marks
5

Marks
Obtained

Profession Tax Act 5 points


S.No.

Description
Annual return on Profession Tax deducted

Maximum
Marks
5

Marks
Obtained

Maximum
Marks
4

Marks
Obtained

SECTION D Other relevant Act/Rules - 130 points


1.

Petroleum Act/Rules - 10 points


S.No.

Is the Licence for storage of petroleum products


obtained?
Is the Certificate for testing of tanks from competent
person obtained?
Are we maintaining register showing particulars of
examination by competent person for lifting machines,
chain ropes, lifting tackles?
Have we taken precautions against smoking/firelights/accidents?

2
3
4

2.

The Boilers Act/Rules S.No.

1
2
3
4

Description

2
2
2

10 points
Description

Have we obtained Registration Certificate from the Boiler


Inspector?
Are we having qualified persons to operate Boilers?
Are the accidents in Boilers intimated to Boiler Inspector
within 24 hrs?
Is the Drawing of Boilers available?

Maximum
Marks
4
2
2
2

Marks
Obtained

3.

The Boilers Act/Rules S.No.

Description
Is the Licence from Explosive Director, Nagpur obtained?

4.

Maximum
Marks
5

Marks
Obtained

Maximum
Marks
5

Marks
Obtained

The Indian Electricity Act/Rules - 10 points


S.No.

Description
Have we obtained Circuit plans/line drawings approved
by Electrical Inspector and is the audit being conducted
periodically?
Are we maintain log book showing load sanctioned Vs
load utilised

2
5.

10 points

The Environment Protection Act/Rules - 20 points


S.No.

Description
Do we have Environment Policy & is it being followed
letter & spirit?
Have we done any audit so far and what are the steps
taken to comply?

Maximum
Marks
10

Marks
Obtained

10

The Fertiliser Control Order - 5 points


S.No.

Description
Is Registration Certificate obtained & renewed once in 3
years?

7.

Maximum
Marks
5

Marks
Obtained

Maximum
Marks
4
3

Marks
Obtained

VOP (Standards of Quality) Order - 10 points


Solvent Extracted Oil Rule
S.No.

1
2

Description
Is Vanaspathi manufactured as per VOP Order
Are
the
Fortnightly
returns
submitted
on
production/despatches?
Is the Licence obtained under Solvent Extracted Rule?

3
8.

Drugs Control Order - 5 points


S.No.

Description

Is the Bathing Bar Licence obtained?

9.

Municipal Act/Rules Licences etc. S.No.

Description

Maximum
Marks
5

Marks
Obtained

Maximum

Marks

20 points

1
2
3

10.

Obtained

Maximum
Marks
5
5

Marks
Obtained

Standards of Weights & Measures Act/Rules - 20 points

S.No.
1
2

Marks
10
5
5

Is the Approved plans/drawings of the building available?


Is the Local Licence to run the Industry obtained?
Is the Sanitary Licence obtained for waste
water/drainage/sewage water?

Description
Are all the weights & measures tested & stamped?
Are the production personnel aware of the basic PCRO
Panel
Has the Certificate for registration & verification
displayed?

ASSESSMENT FOR RATING BASED ON THE SCORING IN SECTION A TO D


1.
2.
3.
4.

If Section A has been fully complied, we should award 600 points


If Section B has been fully complied, we should award 190 points
If Section C has been fully complied, we should award 80 points
If Section D has been fully complied, we should award 130 points

There is, therefore, 1000 points in the scoring area. It is necessary that the FMs/PMs take full
responsibility to comply with all the Acts/Rules applicable to factories/units and ensure that HLL is
one of the law abiding company and prove it that really and truly it is so. While awarding points
look for either complied or not complied and then award points accordingly.
Wherever certain Acts/Rules are not applicable, appropriately those points can be reduced from the
total points.
A. If a Factory/unit gets 950 points (provided in Section A atleast 575 points are obtained) by
complying all the provisions of Factories Act/Contract Labour Act, as per the above rating system,
the factory will get A rating (Factory/unit will get a Shield for this) A Model HLL Factory/Unit for
the compliance of various Acts/Rules. In this case the factory/unit, while self-audit will take place
every year, cross audit will take place once in 3 yrs.
B. If a Factory /unit gets 900 points (Provided in Section A atleast 550 points are obtained)
by complying all the provisions of Factories Act/Contract Labour Act, as per the above rating system,
the factory/unit which gets B rating needs to comply in certain areas. In this case, this factory/unit,
while self-audit will take place every year, cross audit will take place once in 2 years. But a report on
total compliance should come to Head ER every year.
C. If a factory/Unit gets 850 points (provided atleast 525 points are obtained in Section A) this
Factory/unit which gets C rating and it can run conditionally. This fact has to be brought to the
attention of Head ER immediately for further action/advise.
X. If a factory/unit gets less than 850 points (or less than 525 points obtained in Section A) this
factory will get X rating and it has to take steps to comply with the requirements within next 60
days. This has to be brought to the notice of Head-ER immediately.
Overall Ratings
A
B
C
X

<

950
900
850
850

Ratings in Sec.A
575
550
525
< 525