EMPLOYMENT LAW-II REPORT

Management Development Institute

Gurgaon 122 007

Group 1
23PGHR008 Cherukupally V. Reddy
23PGHR021Kunal Chugh
23PGHR027 Palak Dua
23PGHR043 Saumya Joshi
23PGHR044 Seethal Yedlapalli
23PGHR057 Vardaan Grover

MANAGEMENT REPRESENTATIVE
1. What is the total number of permanent,
temporary, contract labor, and fixed-term
workers?

We currently employ 1500 permanent employees and

800 contract labourers supplied by 43 registered
contractors. Additionally, we have 100 fixed-term
workers.

2. What is the rationale behind deciding this

distribution of workers?

The worker distribution is based on both industry

standards and operational efficiency. We maintain a
60:40 ratio of permanent to temporary/contract labor
for non-core operations. Ideally, the ratio should be
70:30, where 70% of core roles are performed by
permanent staff and 30% by contractors, particularly
for non-essential or ancillary services.

3. How many contractors are used for supplying

contract labor?

We currently work with 43 registered contractors, as

indicated by our registration certificate.

4. In which functions and roles is contract labor

used?

Contract labor is typically deployed in non-core

functions such as housekeeping, security, ancillary
production tasks, reject material handling, and
warehouse operations. These roles do not directly
impact the core manufacturing process and are suitable
for outsourcing.
5. How do you ensure that contractors comply
with statutory requirements, including wages
and working conditions?

We strictly adhere to the Contract Labour (Regulation

and Abolition) Act, 1970. Contractors are responsible
for compliance, but we implement a monthly tracking
and audit mechanism to ensure they meet statutory
obligations. This includes verifying payment records for
wages, ESI, EPF, and ensuring adherence to safety
regulations.

6. What measures are in place to monitor and

manage the work conditions of contract
labourers?

Work conditions for contract labour are regularly

audited to ensure compliance with the Factories Act,
1948. This includes providing safety gear, proper
training, health check-ups, and maintaining welfare
amenities such as restrooms and canteen services for
both permanent and contract labour without
discrimination.

7. Is the ESI contribution paid by the company for

contract labour, or is it recovered from
contractors?

The ESI contributions are paid directly by the

contractors under their respective ESI registrations. In
rare cases, if contractors fail to pay, the principal
employer may pay the contribution from its own code
and deduct it from the contractor’s payment.

8. How does the company ensure that

contractors have paid the ESI contribution for
contract labour employed?
We implement a monthly audit of ECR (Electronic
Challan Cum Return) forms submitted by contractors.
These are cross-checked with wage registers to ensure
accurate and timely payment of ESI contributions.

9. Are there regular audits or checks to ensure

compliance with ESI provisions?

Yes, we conduct monthly audits of ECR submissions

from contractors. Additionally, our HR department
verifies compliance with ESI provisions to ensure
correct and timely payments.

10. How much are the wages paid to workers,

and how are these wages divided into
components like Basic, DA, HRA, etc.?

Contract labourers are paid as per the Minimum Wages

Act of the respective state. The wages consist of Basic
Pay, Dearness Allowance (DA), and in some cases,
House Rent Allowance (HRA), as applicable. Additional
allowances may be added based on the number of
years the worker has spent with the company, but 90%
of contract labourers receive minimum wages.

11. What is the process for EPF contributions,

and how do you ensure timely deposits?

The contractor deposits 12% EPF contributions on

behalf of each employee under their UN (Universal
Account Number). These deposits are verified monthly
through the submission of PF challans, which must be
done by the 15th of the following month.

12. What mechanisms are in place to address

discrepancies in EPF contributions or issues with
the Employees' Provident Fund Organisation
(EPFO)?

In case of discrepancies, we rectify any differences in

the next month’s contribution, ensuring accurate
adjustments. The ECR system allows us to track
contributions and address any anomalies with the
EPFO.

13. How many workers (Permanent & Contract)

have completed 240 days of continuous service?

Currently, 200+ permanent and 100+ contract workers

have completed 240 days of continuous service.

14. Has there been an accident in the past with

any worker? How was it dealt with? What was the
compensation paid?

Any accidents are handled per the provisions of the

Employee Compensation Act, 1923. In the event of an
accident, compensation is calculated based on the
worker’s wages and disability or death, and all medical
care and rehabilitation support are provided.

15. How many trade unions are there? Is there

any employee-sponsored union?

There is one recognized trade union in the organization,

registered under the Trade Union Act, 1926. We do not
currently have an employee-sponsored union.

16. What are the standard procedures followed

during layoffs, retrenchment, or closure of
operations?
The company follows the Industrial Disputes Act, 1947,
specifically under Section 2(oo) and Section 25-F for
layoffs and retrenchment. Procedures include seeking
government approval, paying compensation, and
ensuring proper documentation. However, we have not
experienced any layoffs or retrenchments so far.

LABOUR OFFICER

1. What are the most common violations

observed concerning the employment of contract
labour, and how are these typically addressed?

The most common violations observed with contract

labour include:
- Non-payment or delayed payment of wages.
- Non-compliance with statutory benefits, such as
Provident Fund (PF) and Employee State Insurance (ESI)
contributions.
- Lack of proper safety measures and welfare amenities
as per the Factories Act, 1948.
- Employment of child labour, especially in regions with
lower educational levels.

These violations are addressed by conducting regular

inspections under the Contract Labour (Regulation and
Abolition) Act, 1970 and other relevant labour laws. In
cases of non-compliance, notices are issued, penalties
are imposed, and, if violations persist, legal action is
taken, including filing cases in the labour court.

2. How do you verify that establishments are

correctly calculating and depositing EPF
contributions for their employees?
EPF contributions are verified through monthly
Electronic Challan cum Return (ECR) submissions.
Establishments are required to upload their ECR details
on the EPFO portal, which includes the number of
employees and the amount of contribution deposited.
Inspections are carried out to check compliance, and
discrepancies are cross-verified with wage registers
and employee records.

Additionally, establishments are audited annually to

ensure proper calculation and timely deposit of
contributions. Employers must adhere to the 12%
contribution requirement for both employer and
employee as mandated by the Employees' Provident
Fund and Miscellaneous Provisions Act, 1952.

3. What steps are taken when an establishment

fails to comply with EPF contribution
requirements?

When an establishment fails to comply with EPF

contribution requirements:
- First notice is issued to the employer, asking for an
explanation and compliance within a specified time.
- If the employer fails to respond or comply, a second
notice is issued, and penalties are imposed.
- In persistent cases of non-compliance, the matter is
escalated to the EPFO Recovery Officer, and the
company may face legal action under Section 7A of the
EPF Act. This can lead to recovery proceedings,
including attachment of the employer’s bank accounts
or assets.

Fines and interest are levied for late payments or non-

payments.
4. What measures are in place to ensure that all
eligible establishments are enrolling their
workers under the ESI scheme?

To ensure that all eligible establishments are enrolled

under the Employee State Insurance (ESI) scheme, the
ESIC (Employees' State Insurance Corporation)
conducts periodic checks based on the number of
employees and their salary slabs (employees earning
up to ₹21,000/month are eligible). Inspections are
conducted under Section 45-A of the ESI Act, and
establishments are mandated to register with ESI if
they have 10 or more employees.

Establishments must submit monthly ESI contributions

online, and the National Informatics Centre (NIC) tracks
the compliance of all registered entities.

5. How do you handle cases where employers fail

to provide ESI benefits to their employees? What
are the usual penalties?

In cases where employers fail to provide ESI benefits:

- A notice is issued to the employer, asking them to
comply immediately.
- Fines are imposed under Section 85 of the ESI Act,
which can range from ₹5,000 to ₹25,000, depending on
the severity of the violation.
- In serious cases, criminal proceedings can be initiated,
and imprisonment up to 2 years may be ordered under
Section 85(b).

Persistent failure to comply leads to legal action in the

ESI Court. Recovery of unpaid contributions is enforced,
including penalties for default.
6. How do you conduct audits and verify the
accuracy of ESI contributions made by
establishments?

Audits of ESI contributions are conducted by reviewing

the employer’s wage registers and verifying their ECR
submissions on the ESIC portal. Inspectors from the
ESIC department randomly audit establishments to
ensure that contributions match the number of eligible
employees. The online system helps identify
discrepancies between actual payments and required
contributions, ensuring accurate ESI payments.

Additionally, the NIC portal maintains a real-time record

of contributions, which helps inspectors monitor
compliance.

7. How do you facilitate the resolution of

industrial disputes, particularly regarding unfair
dismissals, layoffs, or retrenchments?

Industrial disputes are handled under the Industrial

Disputes Act, 1947. The labour department plays a
mediating role, ensuring that disputes related to unfair
dismissals, layoffs, or retrenchments are resolved
through the following steps:
- Conciliation officers from the labour department
attempt to mediate between the employer and the
employee to reach a settlement.
- If conciliation fails, the dispute is referred to the Labor
Court or Industrial Tribunal.
- In cases of illegal dismissals or retrenchments, the
court may order reinstatement or compensation, as per
Section 25F of the Act.

The goal is to ensure amicable resolution through

negotiations, failing which legal action is taken.
8. What role does the labour department play in
ensuring that establishments comply with the
requirements for notice and compensation under
the Industrial Disputes Act?

The labour department ensures compliance with

Section 25F of the Industrial Disputes Act, 1947, which
mandates that establishments provide:
- Notice period (usually one month) before termination
or retrenchment.
- Compensation equivalent to 15 days' wages for every
year of completed service for retrenched employees.

The department conducts inspections and reviews

records of layoffs and retrenchments to ensure
compliance. Non-compliance leads to legal action,
including fines or reinstatement orders by the Labor
Court.

9. How do you monitor the implementation of

settlement agreements between employers and
employees?

Settlement agreements are monitored by the labour

department through conciliation officers. Once an
agreement is reached, it is registered with the labour
department and becomes legally binding under Section
18 of the Industrial Disputes Act, 1947. The labour
department follows up with both parties to ensure the
terms of the settlement are implemented. If either
party fails to comply, the matter is referred to the Labor
Court, where enforcement orders are issued. Periodic
reviews and meetings with both parties are conducted
to ensure the settlement terms are being adhered to.
 CONTRACTOR

1. How many contract workers are employed by

you?

We employ around 10,000 contract workers, spread

across multiple clients and sectors, including large
multinationals and various industries.

2. How many organizations do you supply

contract labour to?

We supply contract labour to approximately 75

organisations. These include a mix of large
multinational corporations as well as other medium to
large enterprises.

3. What are the different jobs for which you can

supply contract labour?

We supply labour for a wide range of jobs across

different sectors. For blue-collar roles, this includes jobs
in shop floors, warehouses, and other operational tasks.
For white-collar roles, we provide labour for analyst,
back-office, and sales positions.

4. What steps do you take to provide contract

workers with working conditions and wages that
comply with the legal standards?

We ensure compliance with government-mandated

minimum wage laws by processing the salaries of all
contract workers ourselves. Whenever there is a
change in the minimum wage, we notify our clients and
adjust salaries accordingly. We also ensure that the
working conditions provided by the principal employer
meet legal standards, and if any issues arise, we
escalate them with the client for prompt resolution.

5. For how many days is a contract labourer

employed for a single role? What is the usual
duration of contracts?

The duration of employment for a contract worker

typically varies from client to client. However, the
minimum duration is six months, as we believe that it
takes at least a month for workers to settle into their
role, and the next five months constitute the productive
phase. Contracts for less than six months are usually
not feasible due to the learning curve involved in the
work.

6. How do you manage the deduction and deposit

of EPF contributions for your workers? What
systems are in place to ensure accuracy and
timeliness?

We have a dedicated compliance team of around 300

personnel who ensure that EPF contributions are
deducted correctly and deposited in a timely manner.
Every month, we process the payroll, deduct the
prescribed contributions, and deposit the EPF with the
respective authorities. We provide proof of these
deposits to both the client and the government in the
form of challans to ensure full transparency and
compliance.

7. Can you describe any challenges you face in

complying with EPF and ESI requirements and
how you address them?

We generally do not face major challenges in

compliance, as we have a robust system in place. Any
challenges that arise are primarily related to
government-prescribed changes in contribution rates,
but we address these by staying updated and ensuring
that payroll deductions reflect the latest rules.
Additionally, we work closely with clients and
government authorities to ensure full compliance with
EPF and ESI regulations.

8. Do you have an ESI code? Do you pay ESI

contribution after deducting it from wages, or is
it paid by the principal employer?

Yes, we have an ESI code and manage the deductions

from the employee’s salary ourselves. We deduct
0.75% from the employee’s salary and contribute
3.25% as the employer. Once the contributions are
made, we provide proof in the form of challans to the
client. The principal employer is also involved in
ensuring compliance, but we take the responsibility of
making the actual deductions and deposits.
9. What procedures do you follow to help your
workers access ESI benefits, such as medical care
and cash benefits?

Once ESI deductions are made, the workers are issued

an ESI card. They can use this card to access medical
care at designated ESIC dispensaries. In case of claims
for other benefits like disability or maternity, our
operations team assists workers in understanding the
procedures and filing claims under the ESI scheme.

10. How do you address disputes with your

workers, especially concerning termination,
retrenchment, or layoffs?

We handle disputes by following a clear and

transparent process. If a worker has a legitimate
concern, we discuss it with the client and resolve any
errors from our side. If a dispute escalates, we engage
in counselling with the worker and show them the
terms of their employment contract, such as the notice
period required for separation. Most disputes are
resolved amicably. If needed, we also present our case
before the labour authorities.

11. How do you interact with trade unions

representing your workers, particularly regarding
collective bargaining and dispute resolution?

So far, we have not encountered any issues with trade

unions. We ensure that we are providing fair wages and
working conditions to our workers, which helps prevent
disputes. In the event of a trade union issue, we have
Industrial Relations (IR) experts on our team who
handle collective bargaining and ensure that the issue
is resolved in a fair manner.
 UNION LEADER

[Link] the establishment employ contract

labor in roles which are perennial and
necessary for the functioning of the
establishment?
There is no distinction of roles as such, and
contract labor is employed in multiple roles.
[Link] many contractors are employed by the
company for supply of labor? Do these
contractors comply by deducting ESI & PF
contributions?

There are dominantly 30 contractors who supply

contact labor for this factory. Yes, contract workers
do get ESI & PF benefits, and it is ensured by TATA
group that these benefits are made available to all
workers (including contract workers)

[Link] contractors rotate contract labor to

prevent completion of 240 days of
continuous service?

The duration of contracts is usually kept as 6-8

months. Many contract workers are also easily
replaced or laid off depending upon the labor
requirements.

[Link] often does the union review ESI

compliance, and what are the common issues
identified?

No such issues of ESI compliance has been

identified till now. Union is not responsible for ESI
compliance, however we have not received any
issues specific to ESI

[Link] workers get any other benefit other than

the ones mandated by law? Are these
additional benefits extended to contract
workers as well?
 TATA group benefits include an eight-hour working
day, free medical aid, establishment of a welfare
department, leave with pay, workers' provident
fund scheme, workmen's accident compensation
scheme, maternity benefits, profit sharing bonus
and retiring gratuity. These benefits are also
extended to contract workers

[Link] there any employee sponsored trade

union?

No employee sponsored union at JUSCO

[Link] you think that workers face any

discrimination for joining the union in terms
of promotions, lay-off, benefits etc.

No such cases of discrimination have come up yet

for joining the union.

CONTACT DETAILS

[Link] Representative
Name: Ashutosh Pandey
Contact Details: 7987517709
Company Name: Reckitt

[Link]
Name: Muralidhar
Contact Details: 9892346784
Company Name: Team Hr
 Name: Kamaljeet
Contact Details : 8375875091
Company Name: Mynd

[Link] Officer
Name: Vivek Sharma
Designation: Welfare Officer at Chhattisgarh
Government Labor Welfare Board
Contact Details: 9713117807, 9425201242

[Link] Leader

Name: Mr. Raghunath Pandey

Designation: President JUSCO shramik union

(TATA Steel)
Contact Details: +91 92345 11326