PolicyRelaxation of labour laws across statesAnya Bharat Ram- May 12, 2020To contain the spread of COVID-19 in India, the central government imposed a nation-wide lockdown onMarch 24, 2020.  Under the lockdown most economic activities, other than those classified as essential activities, were suspended.  States have noted thatthis loss of economic activity has resulted in a loss of income for many individuals and businesses.To allow some economic activities to start, some states have provided relaxations to establishments from their existing labour laws.  This blog explains the manner in which labour is regulated in India, and the various relaxations in labour laws that are being announced by various states.How is labour regulated in India?Labour falls under theConcurrent Listof the Constitution.  Therefore, both Parliament and State Legislatures can make laws regulating labour.  Currently, there are over100 state laws and 40 central lawsregulating various aspects of labour such as resolution of industrial disputes, working conditions, social security, and wages.  To improve ease of compliance and ensure uniformity in central level labour laws, the central government is in the process of codifying various labour laws under four Codes on (i) industrial relations, (ii) occupational safety, health and working conditions, (iii) wages, and (iv) social security.  These Codes subsume laws such as the Industrial Disputes Act, 1947, the Factories Act, 1948, and the Payment of Wages Act, 1936.How do state governments regulate labour?A state may regulate labour by: (i) passing its own labour laws, or (ii) amending the central level labour laws, as applicable to the state.In cases where central and state laws are incompatible, central laws will prevail and the state laws will be void.  However, a state law that is incompatible with central laws may prevail in that state if it has received theassent of the President.  For example: In 2014, Rajasthan amended theIndustrial Disputes Act, 1947.  Under the Act, certain special provisions with regard to retrenchment, lay-off and closure of establishments applied to establishments with 100 or more workers.  For example, an employer in an establishment with 100 or more workers required permission from the central or state government prior to retrenchment of workers.Rajasthan amended the Actto increase the threshold for the application of these special provisions to establishments with 300 workers.  This amendment to the central law prevailed in Rajasthan as it received the assent of the President.Which states have passed relaxations to labour laws?TheUttar PradeshCabinet has approved an ordinance, andMadhya Pradeshhas promulgated an ordinance, to relax certain aspects of existing labour laws.  Further,Gujarat,Rajasthan,Haryana,Uttarakhand,Himachal Pradesh,Assam, Goa,Uttar Pradesh, andMadhya Pradeshhave notified relaxations to labour laws through rules.Madhya Pradesh:  On May 6, 2020, the Madhya Pradesh government promulgated theMadhya Pradesh Labour Laws (Amendment) Ordinance, 2020.  The Ordinance amends two state laws: theMadhya Pradesh Industrial Employment (Standing Orders) Act, 1961, and theMadhya Pradesh Shram Kalyan Nidhi Adhiniyam, 1982.  The 1961 Act regulates the conditions of employment of workers and applies to all establishments with 50 or more workers.  The Ordinance increases this threshold to 100 or more workers.  Therefore, the Act will no longer apply to establishments with between 50 and 100 workers that were previously regulated.  The 1982 Act provides for the constitution of a Fund that will finance activities related to welfare of labour.  The Ordinance amends the Act to allow the state government to exempt any establishment or class of establishments from the provisions of the Act through a notification.  These provisions include payment of contributions into the Fund by employers at the rate of three rupees every six months.Further, theMadhya Pradesh government has exempted all new factories from certain provisions of the Industrial Disputes Act, 1947.  Provisions related to lay-off and retrenchment of workers, and closure of establishments will continue to apply.  However, the other provisions of the Act such as those related to industrial dispute resolution, strikes and lockouts, and trade unions, will not apply.   This exemption will remain in place for the next 1,000 days (33 months).  Note that theIndustrial Disputes Act, 1947allows the state government to exempt certain establishments from the provisions of the Act as long as it is satisfied that a mechanism is in place for the settlement and investigation of industrial disputes.Uttar PradeshThe Uttar Pradesh Cabinethas approved the Uttar Pradesh Temporary Exemption from Certain Labour Laws Ordinance, 2020.  According tonews reports, the Ordinance seeks to exempt all factories and establishments engaged in manufacturing processes from all labour laws for a period of three years, subject to the fulfilment of certain conditions.  These conditions include:Wages:The Ordinance specifies that workers cannot be paid below minimum wage.  Further, workers must be paid within the time limit prescribed in the Payment of Wages Act, 1936.  The Act specifies that: (i) establishments with less than 1,000 workers must pay wages before the seventh day after the last day of the wage period and (ii) all other establishments must pay wages before the tenth day after the last day of the wage period.  Wages must be paid into the bank accounts of workers.Health and safety:The Ordinance states that provisions of health and safety specified in the Building and Other Construction Workers Act, 1996 and Factories Act, 1948 will continue to apply.  These provisions regulate the usage of dangerous machinery, inspections, and maintenance of factories, amongst others.Work Hours:Workers cannot be required to work more than eleven hours a day and the spread of work may not be more than 12 hours a day.Compensation:In the case of accidents leading to death or disability, workers will be compensated as per the Employees Compensation Act, 1923.Bonded Labour:The Bonded Labour System (Abolition) Act, 1976 will continue to remain in force.  It provides for the abolition of the bonded labour system.   Bonded labour refers to the system of forced labour where a debtor enters into an agreement with the creditor under certain conditions such as to repay his or a family members debt, due to his caste or community, or due to a social obligation.Women and children:Provisions of labour laws relating to the employment of women and children will continue to apply.It is unclear if labour laws providing for social security, industrial dispute resolution, trade unions, strikes, amongst others, will continue to apply to businesses in Uttar Pradesh for the period of three years specified in the Ordinance.  Since the Ordinance is restricting the application of central level labour laws, it requires the assent of the President to come into effect.Changes in work hoursTheFactories Act, 1948allows state governments to exempt factories from provisions related to work hours for a period of three months if factories are dealing with an exceptional amount of work.  Further, state governments may exempt factories from all provisions of the Act in the case of public emergencies.  The Gujarat, Himachal Pradesh, Rajasthan, Haryana, Uttar Pradesh, Goa, Assam and Uttarakhand governments passed notifications to increase maximum weekly work hours from 48 hours to 72 hours and daily work hours from 9 hours to 12 hours for certain factories using this provision.Further,Madhya Pradeshhas exempted all factories from the provisions of the Factories Act, 1948 that regulate work hours.  Thesestate governments have notedthat an increase in work hours would help address the shortage of workers caused by the lockdown and longer shifts would ensure fewer number of workers in factories allowing for social distancing to be maintained.   Table 1 shows the state-wise increase in maximum work hours.Table 1: State-wise changes to work hoursStateEstablishmentsMaximum weekly work hoursMaximum daily work hoursOvertime Pay (2x ordinary wages)Time periodGujaratAll factoriesIncreased from 48 hours to 72 hoursIncreased from 9 hours to 12 hoursNot requiredThree monthsHimachal PradeshAll factoriesIncreased from 48 hours to 72 hoursIncreased from 9 hours to 12 hoursRequiredThree monthsRajasthanAll factories distributing essential goods and manufacturing essential goods and foodIncreased from 48 hours to 72 hoursIncreased from 9 hours to 12 hoursRequiredThree monthsHaryanaAll factoriesNot specifiedIncreased from 9 hours to 12 hoursRequiredTwo monthsUttar PradeshAll factoriesIncreased from 48 hours to 72 hoursIncreased from 9 hours to 12 hoursNot requiredThree months*UttarakhandAll factories and continuous process industries that are allowed to function by governmentMaximum 6 days of work a weekTwo shifts of 12 hours each.RequiredThree monthsAssamAll factoriesNot specifiedIncreased from 9 hours to 12 hoursRequiredThree monthsGoaAll factoriesNot specifiedIncreased from 9 hours to 12 hoursRequiredApproximately three monthsMadhya PradeshAll factoriesNot specifiedNot specifiedNot specifiedThree monthsNote: *The Uttar Pradesh notification was withdrawnParliamentFirst no-confidence motion of the 17th Lok Sabha discussed todayNiranjana Menon- August 8, 2023Discussion on the first no-confidence motion of the 17thLok Sabha began today.  No-confidence motions and confidence motions are trust votes, used to test or demonstrate the support of Lok Sabha for the government in power.  Article 75(3) of the Constitution states that the government is collectively responsible to Lok Sabha.  This means that the government must always enjoy the support of a majority of the members of Lok Sabha.  Trust votes are used to examine this support.  The government resigns if a majority of members support a no-confidence motion, or reject a confidence motion.So far, 28 no-confidence motions (including the one being discussed today) and 11 confidence motions have beendiscussed.  Over the years, the number of such motions has reduced.  The mid-1960s and mid-1970s saw more no-confidence motions, whereas the 1990s saw more confidence motions.Figure1: Trust votes in ParliamentNote: *Term shorter than 5 years; **6-year term.Source: Statistical Handbook 2021, Ministry of Parliamentary Affairs; PRS.The no-confidence motion being discussed today wasmovedon July 26, 2023.  A motion of no-confidence is moved with the support of at least 50 members.   The Speaker has the discretion to allot time for discussion of the motion.  TheRules of Procedurestate that the motion must be discussed within 10 days of being introduced.  This year, the no-confidence motion wasdiscussed13 calendar days after introduction.  Since the introduction of the no-confidence motion on July 26, 12 Bills have been introduced and 18 Bills have been passed by Lok Sabha.  In the past, on four occasions, the discussion on no-confidence motions began seven days after their introduction.  On these occasions, Bills and other important issues were debated before the discussion on the no-confidence motion began.Figure2: Members rise in support of the motion of no-confidence in Lok SabhaSource: Sansad TV, Lok Sabha, July 26, 2023; PRS.Figure3: Number of days from introduction to discussion on no-confidence motionsNote: Number of days implies calendar days.Source: Statistical Handbook 2021, Ministry of Parliamentary Affairs; PRS.On average, no-confidence motions (excluding the one being discussed today) have been discussed for 13 hours over three days.  Discussions have lasted longer than 20 hours on four instances, most recently in 2003.  Today’s no-confidence motion was allotted 12 hours discussion time by theBusiness Advisory Committee.Following the discussion, the motion is put to vote.  26 out of 27 no-confidence motions (excluding the one being discussed today) have been voted upon and rejected.  This means that no government has ever had to resign following a vote of no-confidence.   On one occasion, in 1979, the discussion on a no-confidence motion against the Morarji Desai government remained inconclusive.  He resigned before the motion was put to vote.  50% of all no-confidence motions (14 out of 28) were discussed between 1965 and 1975.  Of these, 12 were against governments headed by Indira Gandhi.Figure4: Duration of discussion on no-confidence motionsNote: This graph excludes the no confidence motion moved on July 26, 2023.Source: Statistical Handbook 2021, Ministry of Parliamentary Affairs; PRS.In comparison, confidence motions have a more varied history.  The first motion, brought in 1979 to demonstrate confidence in Charan Singh’s government, was not discussed at all.  The Prime Minister resigned before the discussion could take place.  Since then, 11 confidence motions have been discussed in Lok Sabha, with nine occurring in the 1990s.  During this period, several coalition governments were formed, and Prime Ministers sought to prove their majority throughconfidence motions.   These motions have been discussed, on average, for 12 hours over two days.Figure5: Duration of discussion of confidence motionsSource: Statistical Handbook 2021, Ministry of Parliamentary Affairs; PRS.Of the 11 confidence motions discussed in Lok Sabha, seven were accepted.  On three instances, governments had to resign as they could not prove that they had the support of the majority.  On one instance in 1996, the motion was not put to vote.  Following an eleven-hour discussion on this confidence motion, Prime Minister Atal Bihari Vajpayee announced his intention to resign on the floor of the House.  He resigned 16 days into his term.Vajpayee became Prime Minister again in 1999, and faced another confidence motion.   This time, it was put to vote.   The motion was defeated by a margin of one vote.  This has been the closest result on a trust vote in the history of Lok Sabha.  The next closest result was when a motion of no-confidence against P V Narasimha Rao’s government was defeated by 14 votes in 1993.  In most cases, results have been in favour of the government by a large margin.«12345678910»
PolicyRelaxation of labour laws across statesAnya Bharat Ram- May 12, 2020