Deconstructing the Occupational Safety, Health and Working Conditions Code, 2020

Background

Continuing in the series of articles, in this article, we shall take a closer look at the Occupational Safety, Health and Working Conditions Code, 2020[1]. The Occupational Safety, Health and Working Conditions Code, 2020 seeks to consolidate and modify the laws regulating the occupational safety, health and working conditions. It replaces a whole bunch of labour laws, most notably, the Factories Act, 1948; the Mines Act, 1952 and the Contract Labour (Regulation and Abolition) Act, 1970 apart from the following:

  1. The Plantations Labour Act, 1951;
    2. The Working Journalists and other Newspaper Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955;
    3. The Working Journalists (Fixation of Rates of Wages) Act, 1958;
    4. The Motor Transport Workers Act, 1961;
    5. The Beedi and Cigar Workers (Conditions of Employment) Act, 1966;
    6. The Sales Promotion Employees (Conditions of Service) Act, 1976;
    7. The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979;
    8. The Cine-Workers and Cinema Theatre Workers (Regulation of Employment) Act, 1981;
    9. The Dock Workers (Safety, Health and Welfare) Act, 1986;
    10. The Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996.

Upfront, the new Code makes it clear that it shall not apply to the offices of the Central Government, the State Governments or any navy ships, though it shall apply to the contract labour employed through contractors in such offices.

Changes to legal terms

As in the case of the Industrial Relations Code, 2020[2], here too the explanation for the term “appropriate Government” mentions that the Central Government shall continue to be the appropriate Government for the Central Public Sector Undertakings even where the Government has divested its stake to below 50%. This could potentially provide a pathway to the Government to undertake further divestment in the PSUs in the future while assuaging the redressal demands of the PSU employees.

Aptly so, the definition of “contract labour” has been now enlarged to specifically cover inter-State migrant workers. The definition of “employees” has been widened to include supervisory, managerial and administrative staff. The scope of the term “employer” has also been widened to include almost all employers including contractors and legal representatives of deceased employers which were up to now, not a part of the said term under the Factories Act and the Mines Act.

The term “establishment” includes any factory, trade/business, construction work or plantation with 10 or more workers. It also includes all mines and ports. The term “factory” includes any establishment with 20 or more workers where the work is done with the aid of power and any establishment with 40 or more workers where the work is done without the aid of power. Again as in the case of the Industrial Relations Code, 2020, here too the definition of the term “industry” has also been elaborated upon to include most enterprises for production, supply and distribution of goods while excluding charitable organisation, sovereign function of the Government and domestic workers. “Mines” connote any kind of excavation works and its ancillary processes.

The new Code introduces the concept of “core activity of an establishment” as opposed to non-core activities such as sanitation, security, running of canteens, hospitals, clubs, guest houses, maintenance, housekeeping, laundry, gardening, transport, loading/unloading and courier services in all establishments where such is not the essential/primary activity.

Besides the usual, the term “manufacturing process” also includes running printing press and cold storages. “Hazardous process” includes any process included in the First Schedule to the Code which requires special care and wherein there is a risk of material impairment to the health of the workers or pollution of the environment. “Hazardous substance” includes any substance which may pose a health hazard to property, humans, plants, animals or even micro-organisms.

The definition of the term “wages” is common with the Industrial Relations Code, 2020 and constitutes basic pay, dearness allowance and retaining allowance, but excludes bonus, HRA, PF contribution of employer, conveyance allowance, overtime allowance, commission, gratuity and any other retirement benefits. Similarly, the definition of the term “workers” includes persons employed in supervisory work and even includes working journalists and sales promotion employees but does not include managerial and administrative staff.

Duties of Employers

The new Code mandates the registration of every employer with the nominated Registering Officer to whom this Code within 60 days of the applicability of the Code. Every employer is required to notify the appropriate Government of commencement or cessation of work at his/her establishment.

As in the older Acts, the new Code casts general duties on the employers to provide a safe work environment to their workers, ensure proper handling and disposal of hazardous substances and to provide and maintain welfare facilities. It also requires the employer to provide free health checkups and medical examinations to their employees. It casts a duty on the employer to ensure the safety of all articles manufactured or imported for use in the establishment and to carry out reasonable testing to ensure the safety of such articles. It also casts a duty on the architects, project engineers and designers of all installations or constructions in the factory/mine premises to ensure their safety.

The new Code also makes provision for compulsory disclosure of certain information by occupier of any factory dealing in hazardous processes or substances. Where any employee is incapacitated from work for more than 48 hours on account of any injury or in case of any dangerous occurrence or outbreak of disease, the employer is required to notify the appropriate Government. The new Code makes provision for the constitution of a Safety Committee in every factory employing 500 or more workers. There is a lower threshold of 250 or more workers for factories dealing in hazardous substances as well as construction worksites and 100 or more workers for mines. The Safety Committee has the role of an intermediary to promote the wellbeing of the employees and to sound out their safety concerns whenever so required.

The provisions in Chapter XI Part I of the Code apply to all establishments and manpower suppliers employing more than 50 contract labours and also prescribes for mandatory licensing of all such contractors. Maintaining the dual layered system of fixing of responsibility of the previous laws, while the primary responsibility for such contract labour lies with the contractor, in case of the contractor’s failure to comply with the mandates of the Code, the ultimate responsibility shall continue to rest with the principal employer.  As in the previous laws, the employment of contract labour for core activities of the establishment continues to stay prohibited, barring a few exceptions.

Responsibilities of the Government

The new Code provides for the constitution of a National Occupational Safety and Health Advisory Board as an advisory body to the Central Government and a similar State Occupational Safety and Health Advisory Board as an advisory body to the State Government on all issues covered by the Code. While the Central Government shall continue to remain the standards’ setter, some leeway has also been given to the States to make modifications wherever necessary. The new Code provides some flexibility to the appropriate Government to exempt establishments in special cases or public emergencies or where they are attached to public institutions for education, training or research and to make rules thereof as also to the employers of mines to submit byelaws.

More or less all the powers afforded to the Labour Inspector in the earlier Acts are carried forward to the Inspector-cum-Facilitator under the new Code. Per Section 36, the District Magistrate shall be the Inspector-cum-Facilitator so far as mines within his/her local limits are concerned. Qualified medical practitioners may be appointed as medical officers for providing medical supervision and examination and certification of workers.

New Code – New work rules

Section 25 of the new Code prescribes a maximum work shift of 8 hours a day in any establishment and this threshold may be lesser for mines. Section 26 prescribes a maximum of 6 working days in a week. Overtime shall entitle the worker to twice his/her regular wages for such overtime duty. Section 29 also prohibits overlapping work shifts where more than two shifts work on the same thing at the same time. As per Section32, adult factory workers shall be generally entitled to one day leave for every 20 days of work while adolescent workers and mine workers shall be entitled to one day leave for every 15 days of work as long they complete 180 work days in a year. There is also a provision for carry over of accumulated leaves to the next year up to a maximum of 30.

In a welcome step towards greater gender equality, the new Code allows women to seek employment in all establishments (including in dangerous operations and with work shifts beyond the regular 6 a.m. to 7 p.m.) and removes most of the special restrictions as were prescribed in the earlier laws. However, it continues to prohibit the employment of workers below 18 years of age in mines (with the exception of apprentices aged 16 years or more).

 Sparing a thought for the migrant labour

After the recent debacle wherein both the Central Government and the State Governments failed to produce any reliable data on the inter-State migrant workers which led to gross mismanagement of their situation adding to their innumerable woes during the Covid-19 lockdown, the new Code provides for the maintenance of such a database by the Central and State Governments.

The provisions of Chapter XI Part II of the Code with regard to inter-State migrant workers apply to the all establishments employing 10 or more such workers. Besides the usual benefits available to other workers under the Employees’ State Insurance Act, 1948 or the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, the new Act seeks to extend the benefit of a to and fro journey allowance, access to PDS and education in their working States and the setting up of a national toll free helpline for inter-State migrant workers. Giving them a much needed breather, the new Code absolves inter-State migrant workers from any proceedings for recovery of any debt or dues from them.

In another welcome step towards providing some semblance of social security to the unorganised sector workers, the new Code provides for the establishment of a Social Security Fund.

Towards health and safety minus the hassle

While the greater inclusion of women and inter-State migrant workers definitely remains the highlight of this new Bill of 2020 (which replaced the Bill of 2019), another appreciable initiative is the introduction of a single-window mechanism for obtaining a common all-India licence for contractors, factories and industrial premises for beedi and cigar work that should help cut through some of the bureaucratic red tape that typically surrounds the procurement of such licences. However, just how much of this will transform to better protection for the industrial labour as well as contribute towards ease of business remains to be seen.


* Advocate-on-Record, Supreme Court of India and disputes resolution lawyer at various Commercial Courts and Industrial Tribunals in Delhi. Author can be reached at gaggar.aditya@gmail.com

[1] The Occupational Safety, Health and Working Conditions Code, 2020

[2] The Industrial Relations Code, 2020

One comment

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    It is importent to bridge the omissions which I consider unmissable. The analysis is incomplete unless it is added the following pertinent points:
    1) In the CLA Act 1970 there was no definition of core activity of an industrial establishment. Now unambiguous definition is provided where engaging contract labour is not prohibited. This definition is a welcome relief with a view to address the frivolous litigations on this point

    2) If there are establishments in more than one State, the license is to be issued in consultation with respective State govts. I think this part will not advance the purpose of licence. The proper law should have been such that the license issued in a place where the HQ of the Industrial establishment exists is valid through out India.
    3) In order to reign on Inspector Raj it is provided that the Inspector cum Facilitator shall not proceed to prosecute the defaulter straight away without giving him an opportunity to comply. If he complies within a period of 30 days no such prosecution ensues.
    4) For certain offences the appropriate govt. has to conduct an enquiry into the complaint by an officer not below the rank of Under Secretary. Hence checks and balances are provided to lessen the burden on the Tribunal.
    5) Compounding of offences, totally a new concept introduced in the code will go in favour of industry on one hand and reduce the burden on the Courts.
    (6) The social security funds will be funded by the fines /penalty recovered from sec.111 and 114 etc.
    7) Failure to issue common license in combination or individually within a period of 45 days will entail auto generation of license and in such deemed cases no enquiry into the facts of application by the specified authority is allowed.
    8) Appropriate govt. has the power to exempt from the code any new factory or establishment . This is enshrined in the code in order to boost fresh investment and more economic activity in a sustainable manner.
    The points are numerous and it is difficult to add in this post of mine.

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