Labour Law Amendments

At last some changes to the Industrial Disputes Act, 1947.

Here is a mail received on the subject from a renowned expert [and my friend] Dr. R Krishnamurthy. I am reproducing it here with his consent.


"I would like to bring to your kind attention the amendment to the Industrial Disputes Act, wherein the definition of a workman now includes a supervisor drawing a salary upto Rs. 10,000 p.m. and any person performing supervisory functions but being paid below Rs. 10,000 p.m. would be treated as workmen. In Maharashtra, where such workmen get protection of the MRTU & PULP Act, it means that termination of the supervisors can also become an industrial dispute and they would be workmen for all practical purposes. This is an important change, though many supervisors are paid in excess of Rs. 10,000/- this change is worthy of notice.  The import of some of the amendments are below:

(i) The definition of ‘Appropriate Government’. Has been amplified.
(ii) While The definition of workmen remains the same, section 2(s)(iv)has been amended to exclude a person who is employed in a Supervisory capacity draws wages exceeding Rs.10,000/- per month from the definition of ‘workmen’. Earlier the wage limit was Rs.1600/- per month in other states and Rs. 6,500 in Maharashtra
The rest of the definition (i.e., or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, function mainly of a managerial nature) remains unchanged.
(iii) A grievance redressal machinery in an establishment having 20 or more workmen with one stage appeal to the employer has been provided.
(iv) In cases of retrenchment, discharge, dismissal or termination of services, the workman can directly apply to Labour Courts/Tribunals after expiry of 45 days from the date he has made the application for reinstatement to the conciliation officer. The outer limit to approach the Labour Court or the Industrial Tribunal is 3 years from the date of the dispute, termination, retrenchment etc

An amendment Bill in the Payment of Bonus Act is likely to be passed. Major features of the proposed Payment of Bonus Amendment Bill 2010  are listed below:

1. Eligibility limit to be enhanced from Rs. 10,000/- to Rs. 12,000/- per month.
2. Calculation ceiling to be enhanced from Rs. 3,500/- to Rs. 5,000/- per month.
3. Minimum bonus @ 8% to be enhanced to 11%.

With the proposed amendment, minimum bonus payable would be Rs. 6600/- @ 11% while maximum 20% will continue to remain the same.

So much to speak of the employers organisation like EFI, CII and their clout with the government that these major developments take place without even consultation and the views of the employer's body. Assocham, FICCI and others are quite active, when it comes to economic policies, but  on labour issues, government does not think employers need to be consulted. They would not dare push labour reforms in the same manner, something that employer groups have been crying hoarse since 1991."

Dr. R. Krishna Murthy

Dr. R Krishna Murthy, Director, Mega Ace Consultancy [India] is a consultant heading S.R. Mohan Das & Associates, a Consultancy firm that specializes in the field of Industrial Relations and Human Resources Management. He is also the Director of Industrial Relations Institute of India, a non-political and non-governmental organization, set up by Mr. Mohan Das and Editor of its monthly update ARBITER.

He has done his Ph.D. in Management from the Jamnalal Bajaj Institute of Management. He passed out from Bajaj Institute in 1976 with specialization in the area of Personnel and after doing his Ph.D. completed his LL.B. As an organizational consultant he has been associated with a number of organizations to assist in organizational change and Human Resources Development activities within the organization.

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