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The Factories Act 1948

Prof R.Madhwaraj

1
Factory Commissin 1890

Amendments in
1891,1911,1922,1923,1924,1934

and finally in 1948


Objects of the Act
To Protect human beings from
subject to unduly long hours of work

To Provide workers healthy and


sanitary conditions , safety

To prevent workers from accidents


Definition of Factory
“Factory" means any premises including the precincts
thereof-
(i) whereon ten or more workers are working, or
were working on any day of the preceding twelve
months, and in any part of which a manufacturing
process is being carried on with the aid of power,
or is ordinarily so carried on, or
(ii) whereon twenty or more workers are working,
or were working on any day of the preceding
twelve months, and in any part of which a
manufacturing process is being carried on without
the aid of power, or is ordinarily so carried on,- but
does not include a mine subject to the operation of
the Mines Act, 1952 (XXXV of 1952) or a mobile
unit belonging to the armed forces of the Union, a
railway running shed or a hotel, restaurant or
eating place;
Definition of Factory

• Explanation I.---For computing the number of workers


for the purposes of this clause all the workers in
different groups and relays in a day shall be taken into
account;

• Explanation II.---For the purposes of this clause, the


mere fact that an Electronic Data Processing Unit or a
Computer Unit is installed in any premises or part
thereof, shall not be construed to make it a factory if
no manufacturing process is being carried on in such
premises or part thereof ;
Premises or precincts
Includes open land with building or building alone
Salt workers AIR1962SC29
Precincts includes space enclosed by wall
Manufacturing Process Sec 2(k)
Making, altering,repairing,ornamenting,
finishing, packing, oiling,wasing,cleanising,
breaking up, demolishing,or otherwise treating, or adapting
any article or substances with a view to its
use,sale,transport, delivery or disposal,
Pumping oil,water,sewage, or any other substance OR
Manufacturing process included
Bidi Making
AliSaheb Kashim Tamboli Vs State of Bombay
Conversion of raw films into finished products
KVV Sharma (1950)ILLJ 29
Preparation of foodstuff and eatables in Kitchen of a
restaurant
Tajmahal café VS Inspector of Factories Mangalore
Woker -- defined
Sec 2(I)
A person employed,
directly or through any agency (including a contractor)
With/ without the knowledge of Principal employer,
whether for remuneration or not,
in any manufacturing process,
or in cleaning any part of the machinery of premises
used for a manufacturing process or
in any other kind of work incidental to , or connected
with, the manufacturing process, or
the subject of the manufacturing process
but does not include member of Armed forces
Sattedars, who weresupplied
tobacco,bidi leaves by the
factoriesThey were geatting the
bidies rolled and they were paid.
Supreme court held in -
ChinthamaniRao Vs Madhya Pradesh
that they were not workers.
Health ,Safety and welfare of the workers
Must be given priority .
Annual leave
.
Seventh day should be holiday
Casual leave, Earned Leave, Maternity
leave, casual leave, Medical leave etc.
Working Hours
Max 9 hrs a day, 48 hrs a week, extra
wages for overtime work

There must be a Welfare officer for


every 5oo worker in a factory
Creche if there are 30 or more women
workers
The Industrial Disputes Act 1947
It is a social legislation
To bring harmony and cordial relation
between employer and employee
Preamble
An Act to make provision for the investigation
and settlement of industrial disputes and for
certain other purposes
Industry --defined
Any Business ,trade or calling of employers and
include any calling, service, employment ,handicraft
or industrial occupation or vocation of workmen
The Test for Industry
1) Any systematic activity
2) Co operation between employer & employee
3) Production and /or distribution of goods and
services calculated to satisfy human wants and
wishes
BWSSB Vs Rajappa
TT Devasthanams Vs Commissioner of Labour
Employees are worker as per the Act
Gopal VsThe Administrative Officer,Khadi &
Village Industries Board Madhya Pradesh
KVIBoard is an Industry (Supreme court)
Industry includes Directorate of State
Lottery,Hindustan Copper Ltd,Municipal Council
etc as per the different decisions in the courts
Industrial Dispute (Sec 2k)
Means any dispute or difference of opinion
between
a)Employer and Worker
b) Employer and Employer
c)Worker and Worker
Which is connected
Employment or non employment OR
Terms of employment OR
with the conditions of labour of any person
Unless a demand is raised by the workmen
and rejected by the Management there cannot be a
Industrial Dispute
WS Insulators India Ltd Vs Industrial Tribunal Industrial
dispute must be collective dispute
Even the unregistered Unions may raise the Industrial
Dispute
(Newspapers Ltd Alahabad Vs UP State Industrial
Tribunal)
However an Individual workman whose services are
terminated can now raise an Industrial Dispute (Sec 2A)
Workman (Sec 2(s)
Means any person including apprentice
Employed in any industry
To do any skilled or unskilled, manual,
supervisory, operational,
Technical or clerical work for hire or reward,
Whether the terms of employment be
express or implied and include who has been
dismissed or retrenched
Settlement of Disputes
Dispute
Referred to works committee
If not settled to Conciliation Officers/Board of
conciliation– if not settled refer to Adjudication viz
Court of Inquiry– Labour court—
Industrial Tribunal– National Tribunal
results in Award
If aggrieved to Supreme Court
Strike and Lock out
Sec 2(q) STRIKE means
Cessation of work by a body of persons
employed in any industry
Acting in combination Or a concerted refusal
under a common understanding
Of any number of persons who are OR
have been so employed to continue to work
OR to accept employment
TYPES OF STRIKES
Stay in strike, Go slow strike, Lightning or wild cat strike,
Work organisation Rule, Gherao, Bandh, Picketing and
peaceful demonstration

The workers have no fundamental right to go on strike.


No political party or organization can claim that it is entitled
to paralyse the industry and commerce in the entire State
or nation and its entitled in prevent the citizens not in
sympathy with its view points from exercising their
fundamental rights or from performing their duties for their
own benefits or the benefit of the Nation. Such a claim
would be unreasonable and could not be accepted as a
legitimate exercise of a fundamental right by a political
party or those comprising it
Kerala High court judgment up held by S court
Lock out means closing the place of
business either fully or partially to
prevent the workers to work or to
continue to work .
This is weapon in the hands of employers
Retrenchment and Lay off
The Payment of Gratuity Act1972
Gratuity is social security benefit – It is a kind
of gratuitous payment to be paid by the
employer to employees in recognition of the
services rendered by the employees at the
time of termination of services
The termination may be due to
Superannuation, Voluntary retirement.
Compulsory retirement , termination ,
resignation, or death.
Continuous Service

Sec @(c) An Employee is said to be in


continuous service for a period if he,she has ,
for that period, been in uninterrupted service ,
including service which may be interrupted on
account of

Sickness, Accident, Leave,, Lay off, Strike ,Lock


out ,Cessation of work not due to any fault of
the employee
Family defined
Family Sec 2(h)
Male employee –himself, children whether
married or not,, dependent parents, and
dependent parents of his wife, widow and
children of his predeceased son

Female employee _ herself, husband,children


whether married or not, dependent
parents,dependent parents of husband,
widow and children of her predeceased son
Rate of gratuity
15 days of last pay drawn for every completed
year of service subject to Max of Rs 10 lakhs
Gratuity is exempted from Income tax subject
to limitations under the Income Tax Act.
Gratuity is not attachable
Minimum of 5 yrs service to be eligible to
receive gratuity
(In case of death No minimum service fixed )
NOMINATION
Nomination must be in the name of the member/s
of the family Nomination may be made in the
name of more than one person and fix the
proportion also
If the nominee pre deceases the employee and
modification is not made , the gratuity to be
distributed among the legal heirs as per law.
If the gratuity is not paid by the employer within
the stipulated time, he is liable to pay the interest
and may be liable for imprisonment

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