While manufacturing units, which use power to run and employ below 40 workers will be brought out of the ambit of the Factories Act of 1948, units operating without power and employing less than 20 workers needn’t comply with the law.
At present, the Factories Act applies to manufacturing units with at least 10 workers, if the premises uses electricity, and to establishments with 20 or more workers, irrespective of power usage.
Similarly, the Contract Labour Act, 1970, will be amended so that contractors employing up to 50 workers will not be under the purview of this law, instead of 20 at present.
For this purpose, the government will seek permission from the central government as labour falls under the concurrent list of the Constitution. States can make amendments, but they need the Centre’s approval.
The government will exempt companies setting up factories in the next 1,000 days from many provisions of the Factories Act — which spells out the legal framework for occupational health, safety and working conditions of employees.
The government will likely take this step without the consent of the central government, using a provision in the law that can be invoked by states during a public emergency, war or internal disturbances.
New units set up in Madhya Pradesh
will be exempted exempted from the necessary provisions of cleanliness, disposal of wastes, ventilation, lighting, drinking water, urinals, canteens, rest rooms, crèches, working hours, wages during the leave period, and the need for the manager of the factory to send notice to authorities in case any worker contracts occupational diseases.
“Under the Factories Act 1948, new industries will be exempted from all sections except Sections 6,7,8, Section 21 to 41 (H), 59,67,68,79,88 and Section 112 of the Factories Act, 1958. This will now exempt industries from departmental inspections. Industries will be able to conduct third-party inspections at will,” the press statement said.
It added that industries will not be required to maintain registers and can change shifts at their convenience.
Labour law experts expressed concerns over some of the proposed changes, which they feel will lead to deteriorating working conditions.
“The changes, allowing companies to not bother about certain critical elements of safety such as proper ventilation, room temperature or to appoint welfare officers and to let some working conditions go by will create scope of occupational hazard for workers,” said KR Shyam Sundar, labour economist and professor at XLRI, Jamshedpur.
The government will also amend the Industrial Disputes Act, 1947, which has provisions to protect harmony of relations between workers and industry and defines retrenchment, lay-off and compensation norms.
“After the amendment in the Industrial Disputes Act 1947, new establishments will get exemption from many provisions in the Industrial Disputes Act for 1,000 days. Establishments will be able to keep the labourers in service as per their convenience. The intervention of the department of labour and the labour court in action taken by the industries will be stopped,” the press statement added.
The new factories will also not be required to contribute ~80 per worker towards the Madhya Pradesh
Labour Welfare Board fund, set up in 1982, for over two years. “Along with this, they will also get an exemption from [filing] the annual return,” the government said.
This comes in the backdrop of recent amendments made by the governments of Rajasthan, Haryana, Himachal Pradesh and Punjab to the Factories Act to allow companies to employ workers for a maximum 12 hours a day, instead of 8 hours, for three months to compensate for the loss of production because of the Covid-19-induced lockdown.