statutes governing factory management

8/4/2019 Statutes Governing Factory Management

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STATUTES GOVERNING FACTORY

MANAGEMENT

Objective:

To create awareness of Labour regulations among the non-personnel /

commercial managers

To enable interpretation and application of relevant laws in day to day

factory administration

These guide lines are meant to be a ready reckoner of the important Labour

laws governing for the line managers. It must however be borne in mind that

the coverage of the acts it in no way exhaustive. It aims to provide merely

working knowledge of the laws.

The important acts governing day to day factory administration are as follows:

The Factories Act, 1948

The Contract Labour Act, 1970

The Employees Provident Fund & Misc. provisions Act, 1952

The Minimum Wages Act 1948

The Payment Wages Act 1936

The Payment Bonus Act 1963

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The Payment Gratuity Act 1965

The Apprentices Act 1961

The National & Festival Holidays Act 1958

The Employees State Insurance Act 1948

THE FACTORIES ACT, 1948

Object:

• To consolidate and amend the laws regulating Labour in factories

• To provide for health, safety and welfare needs of workers

Key Definitions:

Worker

A person employed- directly or through a contractor – with or without the

knowledge of the principal employer- whether for remuneration or not – in

any manufacturing process.

Factory

Any premises where a manufacturing process is being carried on – with 10 or

more workers- with the use of power.

Manufacturing process

It has been defined all - inclusively. It means any process for (1) making,

altering, repairing - treating or adapting any articles for its use, sale

transport, delivery or disposal (2) pumping oil, sewage or any other

substance (3) generating, transforming or transmitting power (4) Printing &

printing related (5) Shipbuilding and repairing (6) preserving or storing any

articles in cold storage.

sufficient latrine and urinal accommodation of prescribed types;

To provide for a sufficient number of spittoons and maintain them in a clean

and hygienic condition.

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Every factory shall, in accordance with the provisions of the act, take

appropriate safety measure:

•

To fence dangerous part of the machine- for example prime movers,flywheel, electric generator, rotary converters;

• To prohibit employment of women and children near cotton openers;

• To maintain hoists and lifts of good mechanical condition, of sound materials,

and adequate strength:;

• To keep all floors, steps, stairs ,passages and gang way in good condition;

• To prohibit any person from carrying or moving any load so heavy as to be

likely to cause him injury;

To protect workers from injury to eyes from particles or fragments thrown off in

the course of the manufacturing process;

To protect workers from dangerous fumes, inflammable dust, gas, such other

materials:

To protect workers from fire and provide for precautionary measure - for

example, safe means of escape for all persons in the event of a fire; fire

resistant construction of buildings; adequate fire extinguishing equipment;

alert; efficient and well – trained fire fighting squads.

Every factory shall in accordance with the provisions of the Act, take

appropriate welfare measures to provide:

• Washing facilities

• Facilities for storing clothing not worn during working hours and the drying of

wet clothing

• Facilities for the sitting of workers while they are on duty

• First-aid boxes or cupboards – one for every 150 workers and ambulance

facilities if there are more than 500 workers

• Canteen if employing more than 250 workers

• Shelters, rest rooms and lunch rooms, if employing over 150 workers

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• A creache, if employing more than 30 women

• Welfare officer, if employing 500 or more workers

The main restrictive provisions of the Act about the working hours of adults are:• A worker cannot be employed for more than forty-eight hours in a week

• He must be given a holiday for a whole day in every week

• If a worker is deprived of any of the weekly holidays, he shall be given

compensatory holidays (u/s 53)

• A worker cannot be employed for more than nine hours in a day

• A worker must be given an interval of rest of at least half an hour after five

hours of work

• The total period of work inclusive of rest intervals, must be spread over more

than ten and half hours in a day

• If a worker works for more than nine hours in a day or for more than forty-

eight hours in a week, he shall be paid for overtime work at the rate of twice

the ordinary rate of wages.

The State Government may make rules in respect of adult workers in factories

providing for the exemption, to such an extent and subject to such conditions as

may be prescribed. In making rules under this section, the State Government

shall not exceed, except in respect of extemption, the following limits of work,

inclusive of over-time:

The total number of hours of work in any day shall not exceeds ten

The spread over, inclusive of the intervals for rest shall not exceed twelve

hours in any day

The total number of hours of work in a week including overtime shall not

exceed 60

The total number of hours of over-time shall not exceed 50 in any one

quarter

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The main restrictive provision of the Act about the employment of workmen and

children are

A women worker cannot be employed except between the hours of 6 a.m. to

7 p.m. (It is understood that, in a recent judgement given by the High Court,Chennai women worker can be employed even in night shifts)

The employment of a child below the age of 14 years is totally prohibited

A child who has completed the age of 14 years but has to completed the age

of 15 years can be employed for a maximum of 4 ½ hours in a day

A child worker must have a certificate of fitness granted by a certifying

surgeon

The manager must maintain a register of child workers in the prescribedform

A child who has completed the age 15 years but has to completed the age of

18 years can be employed as an adolecent if he had certificate of fitness to

Perform a full day’s work

THE CONTRACT LABOUR ACT 1970

Objective:

The contract Labour Act, 1970 is a piece of central legislation which provides forthe abolition of contract Labour wherever possible and for the regulation of the

conditions of contract Labour in establishment or employment’s where the

abolition of contract Labour system is not considered feasible for the time being.

Definition

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A workman shall be deemed to be employed as “contract Labour” in, or in

connection with the work of, an establishment when he is hired in or in

connection with such work by or through a contractor with or without the

knowledge of the principal employer.

Registration:

The Principal employer has to apply for registration certificate, if employing

more than 19 employees.

License

If any contractor is employing more than 19 employees under his contract he

has to apply for License.

A Contractor is required to provide

(1) Rest rooms or other suitable alternative accommodation where contract

labour is required to halt at night in connection with the work of an

establishment.

(2) A sufficient supply of wholesome drinking water, a sufficient number of

latrines and urinals of prescribed type and washing facilities

(3) First-aid box equipped with the prescribed contents readily accessible

during

all working hours.

(4) A canteen in every establishment employing 100 or more worker

The act imposes a liability on the principal employer to provide the above

amenities to the contract Labour employed in his establishment if the contractor

fails to do so.

The payment of wages and deductions if any shall be made by the contract in

accordance with the provision of the payment of wages Act; it is the

disbursement of wages and also certifies the amount paid as wages by the

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contractor. Under the act, it is the responsibility of the principal employer to pay

the unpaid wages of contractor fails to pay the same or make short payment

The Employee’s provident Fund &Miscellaneous Provision Act – 1952

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Object

The Employee’s provident fund and miscellaneous provision Act – 1952

instituted a compulsory contributory fund to take care of the;

Future of the employee after his retirement

Dependents in case of his early death

Applicability

• Every factory as defined under the factories Act

• Every establishment employing 20 or more persons

• Any other establishment so notified by the central

• Government even if employing less than 20 persons.

Classification of establishment for coverage

Exempted

Unexampled

Employee’s covered:

• Every employee, including the employed through contractors (excludes an

apprentice engaged under apprentices act)

• Every employee who is in receipt wages up to Rs. 6500/-

(The notification has been issued to increase the wage limit to Rs.6500/- per

month with a view to enhance the retirement pension benefits of employees.

The necessary amendment issued effecting 10.06.2001.)

Wages Definition:

Basic wages and Dearness Allowances

Schemes:

Employee’s provident fund scheme 1952

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Employee’s family pension scheme 1971 which has now been merged with

employee’s pension scheme 1995 and

Employee’s deposit linked insurance scheme 1976

Employee’s Pension scheme:

• Employee’s Pension scheme introduced W. e. f. 16. 11. 1995

• Employee’s family pension scheme has been merged with the new scheme.

Benefits of the scheme:

♦ Monthly pension to employees

♦

Monthly pension on account permanent total disablement during service♦ Pension to widows

♦ Monthly pension for children / orphans

Nomination

Every employee on becoming a member is required to submit a nomination

An employee may nominate one or more persons as nominees indicating

percentage of share

Contributions:

Establishment employing less than 20 and sick industrial companies –

10% of the basic wages & dearness allowance

Establishment employing 20 or more persons – 12% of the basic wages

and dearness allowance.

Employers’ contribution is equal to the employee contribution.

Allocation of contribution

8.33% of employer’s contribution @ the maximum tune of Rs. 541/- I-e equal

to 8.33 % of Rs. 6500/- is being credited to the pension fund. The balance

3.67% of 12 % goes to employees provident fund account.

The entire employee contribution is credited only to the EPF account.

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Voluntary contribution:

Employees can voluntarily contribute ranging between 5% & 24% over and

above the statutory requirement No matching contribution from employers is compulsory.

Employees deposit linked insurance:

• Employer has to contribute 0.5% of the actual wages to this fund.

• This can be exempted from the P F authorities by taking policy from LIC of

India.

Administrative Charges:

For PF, the employer has to pay 1.10% of the employee’s wages

administrative charges.

For EDLI the employer has to pay 0.01% of the employees wages

administrative charges.

If employer gets exemption in lieu of EDLI from LIC of India, he has to pay an

Inspection Charges @ 0.005 % of the total wage to the P F authorities.

Responsibility:

Employer to deposit his own as well as the employee’s contribution in

respect of all employees including contracts Labour into the respective PF

account.

Deductions:

Employer to deduct employee’s contribution from the wages

Employer’s contribution not to be deducted from the wages of any employee

Employees deposit Linked Insurance Fund:

Upon death of a member, family will be paid maximum of RS. 62,000/-

depending upon period of service completed

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Employers can opt for exemption after entering into an arrangement with LIC

to extend EDLI benefits.

Transfer of accumulations:

Members, while changing employment should apply for transfer of

accumulations in from 13 through the new employer.

Accumulation in the pension fund – options to be exercised

An employee who has been a member for less than 10-year can withdraw

his accumulation from the pension fund or he can opt for scheme

certificate.

An employee who has been a member for more than 10 year cannot

withdraw accumulation in the pension fund. He will be eligible for reduced

pension between 51 & 58 year of age

Settlement of PF without waiting period:

Retirement from service upon attaining the age of superannuation

Retirement on account of permanent & total in capacity for work due to

bodily or mental infirmity duly certified by the medical officer of the

establishment.

Termination of service in the case of mass or individual retrenchment

Termination of service under VRS

In respect of all other members, application can be made only after a

waiting period of 60 days.

Early withdrawal of accumulations:

Members who leave the country or take to self employment

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Members who changed employment from covered to an uncovered

establishment

Female members, upon marriage, who give up employment.

The Minimum Wages Act 1948

Objective:

The act extends the concept of social justice to the workmen employed in

certain scheduled employment by statutorily providing for them minimum rate

of wages.

Definitions:

Wages means all remuneration capable of begin expressed in terms of money

which would, if term of the contract of employment, expressed or implied, were

fulfilled, be payable to a person employed in respect of his employment or of

work done such employment, and includes house rent allowance but dose not

include

• The value of any house accommodation supply of light, water, medical

attendance; or any other amenity or any service excluded by general or

special order of the appropriate government;

• Any contribution paid by the employer to any pension or provident fund or

under any scheme of social insurance;

• Any sum paid to the person employed to defray special expenses entailed on

him by the nature of his employment.

• Any gratuity payable on discharge.

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Provisions:

When in respect of an employment, the appropriate government has fixed and

notified minimum rates of wages the employer is bound to less than the ratesnotified.

The appropriate government may review wages at such intervals, as they think

fit but not exceeding five years, and revise them, if necessary. The appropriate

government may refrain from fixing minimum rates of wages in respect of any

scheduled employment in which less than 100 employees are employed in

whole state.

The minimum rates of wages may be fixed:

• For different classes in the same employment;

• For adolescents, children and apprentices;

• For different employment

• For different localities;

The rates of wages may be

• A time rate

• A piece- rate

• A guaranteed time rate

• An over time rate.

The rates may be fixed by the hour, by the day or month or by any other longer

period as may be prescribed. The rate fixed may consist of the basic rate of

wages and dearness allowance as may be fixed by the Concerned Government

based on the Consumer Price Index fixed then and there, and the cash value of

confessional rates.

The minimum wages payable under the Act are to be paid in cash but it also

provide for authorization of payment in kind where the appropriate government

considers it necessary. The appropriate government may fix the number of

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hours of work, rest day, payment of overtime in respect of schedule

employment. Provision has been made in the Act for the maintenance of

registers and records in the prescribed manner.

The Payment of Wages Act – 1936

Object:

• To regulate payment of wages at regular intervals.

Applicability:

• Person employed in a factory other establishments

• Shall not apply to employee drawing wages exceeding RS1600/-

Wages

All remuneration by way of salary, allowances or otherwise and include over

time wages.

Time of payment of wages:

• In factory or establishment, in which less than 1000 person are employed

wages shall be paid before the expiry of the7 days.

• In any other factory or establishment wages shall be paid before the expiry

of the 10 days.

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• In case of termination of an employee, wages earned by him shall be paid

before the expiry of the second working day from the date of termination.

Deductions which may be made from the wages:

Fines:

• Approval to be obtained from the Government for imposing fine

• Opportunity to be given before imposing fine

• Amount of fine shall not exceed 3% of the wage payable to an employee

• Fine imposed cannot be recovered

Deduction for absence from Duty:

• The absence of an employed person from the place he is required to work

• Amount of deduction shall be proportionate to the period of absence

• If 10 or more persons concertedly absent themselves without notice. The

deduction may include such amount exceeding 8 days wages

Deductions for damage or loss:

Deduction can be made to the extent of the damage or loss caused to the

employer by neglect or default

Other deductions:

• House accommodation provided by the company

• Electricity

• Professional tax

• Recovery of advance

• Recovery of loans

• Payment to co –operative society and insurance schemes

• Income tax

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• Order of a court

• Subscription to union

Deductions not deemed to be deduction from wages:• With holding of increments

• Reduction to a lower post or time scale

• Suspension

Maximum deduction permissible:

The total amount of deduction from wages of an employed person shall not

exceed :

a) 75% in case such deductions is wholly or partly for payment to co-

operative society

b) 50% in any other case

Payment of Bonus Act 1956

Objective

• Provide for payment of bonus to employee on the basis of profits or on the

basis of production or productivity.

Applicability

• Factory as defined in the factories Act

•

Every other Establishment in which 20 or more persons are employed

Definitions

Bonus:

• Deferred wages

Salary:

• Basic wage and Dearness allowance

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Factory:

Any premises wherein 10 or more workers are working in a manufacturing

process with the aid of power or 20 or more workers are working without.

Establishment:Any place where any industry trades business or service is carried on.

Employee:

Any person other than an apprentice employed on a salary not exceeding RS.

3500

Eligibility:

• Employees receiving salary/ wages up to RS. 3500/- per month

• Employees must have worked for at least 30 working days in the financial

year.

Quantum:

• Minimum of 8.33% of the salary/wages earned

• Maximum of 20% of the salary/wages earned depending upon the allocable

surplus.

Computation:

• RS. 2500/- x 12x 8.33% or percentage of bonus declared

• For the purpose of computation salary exceeding RS. 2500/- per month will

be ignored.

Illustration:

An employer declares a bonus of 15% and if an employee whose salary for the

year is as follow:

• April to October Rs, 2000/-

• November to January Rs 2500/-

• February to March Rs 3500/-

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Bonus @ 15%

Rs, 2000 x 7 months i.e. April to October = 14000/-

Rs, 2500 x 3 months i.e. November to January = 7500/-Rs, 3500 x 2 months i.e. February to March = 5000/-

(Rs, 3500 to be treated as Rs, 2500)

Total Rs. 26500/-

Rs 26500 x 15% = Rs, 3975/-

Allocable surplus:

• 60% of available surplus is allocable surplus and in case of foreign companies

it is 67% of available surplus.

Available Surplus:

• Gross profit – (depreciation in accordance with the IT Act – Rebate- direct

taxes)

Set on and set off

Set on:

• In an accounting year, if the allocable surplus exceeds the amount of bonus

payable, the excess amounts subject to a max. Of 20% of the total salary or

wages shall be carried forward.

• The amount will be set on in the succeeding accounting year for the purpose

of payment of bonus.Set off:

• If there is no allocable surplus or there is no sufficient “set on” for minimum

bonus payable, the funds spent towards statutory disbursement can be “set

off” in the succeeding accounting year.

Bonus linked to production / Productivity:

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• Payment of bonus can be linked to production/ productivity in lieu of bonus

on profit

• It should be under an agreement or settlement

• This scheme should be subject to minimum and maximum bonus payableunder the Act.

Example – set on/ set off

Company x = Allocable surplus = Rs. 20,000/- in 1993

Max Bonus paid restricted to 20% = Rs 4800/-

Bonus paid = Rs 4800Set on = Allocable Surplus – Bonus paid restricted to

20% of salary / wages = Rs 4800/-

1994 –Allocable surplus –min Bonus = Rs 2500/-

Bonus paid = Rs 2500/-

Set on 1993 adjusted = (Rs 4800- 2500 = 2300)

1995 – Allocable surplus Nil

Min bonus = Rs 2800/-

Bonus paid Rs. 2800/-

Set on 1993 adjusted

Set off for the following year = Rs 500

Disqualification for Bonus:

• Termination of service on account of

• Fraud

• Theft

• Riotous or violent misbehavior

• Misappropriation

Proportionate reduction in bonus:

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• Bonus shall be proportionately reduced for the days for which wages have

not been earned.

• Days of lay off leave with pay, disablement caused by accident in the course

of employment or maternity leave shall be considered as days worked.

New Establishment:

• In the first five accounting year – bonus shall be payable only in the

accounting year in which profit are made

• In the sixth and seventh accounting year, principle of set on/ set off to be

applied and bonus paid

• From 8th accounting year- bonus to be calculated and paid irrespective of

profits.

The Payment of Gratuity Act – 1972 Object:

Provide retirement benefit for long and unblemished service

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Reciprocation by company for contribution by employee

Entitlement:

Every employee who has rendered continuous service of five year or more No restriction on salary/ wages

Salary/ Wages:

Basic wages and dearness allowance

Continuous service defined:

Uninterrupted service including service interrupted by sickness /

accident / absence from duty with or (without leave) lay off, strike or lock

out or cessation of work not due to the employment‘s fault.

In case of mine or non- seasonal establishment – 190 days of attendance

during the preceding year.

In all other cases – 240 day of attendance during the preceding year

Break in Service:

An order passed treating the absence as break in service in accordance with the

standing orders, rule or regulation governing the employees of the

establishment.

When Gratuity is Payable

Superannuation

Retirement / Retrunchment

Death

Note: The completion of continuous service of five year shall not be applicable.

Computation of Gratuity:

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Last drawn salary (Basic +DA) x 15/26 x no.of completed year of service.

*More than six months of service will be reckoned as one year and less than six

month of service will be ignored for purpose of calculating years of service

Maximum Gratuity

It should not exceed RS 3.5 lakes in any case

(A) Deduction permissible from Gratuity

Termination of service for any willful omission or negligence causing any

damage , loss or destruction of employer’s property

Reduction to the extent of such damage or loss permissible.

(B) Forfeiture of Gratuity

Forfeiture can be wholly or partially

Termination of service for riotous or disorderly conduct or any other act of

violence.

Termination of service for any act which constitutes an offence involving

moral turpitude, provided that such offence is committed in the course of

employment.

Nomination:

Employee to submit nomination in the prescribed form in duplicate to his

employer within 30 days of completion of one year of service.

Application for payment of gratuity

Application to be submitted within 30 days from becoming eligible by

employee or his nominee

Application can be made 30 days in advance of Superannuation

Time limit for payment of gratuity

30 days from the date it becomes payable

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with interest after 30 days

When gratuity is to be deposited with the government

Nominee or the legal heir of the employee is a minor In case of a dispute with regard to the quantum of gratuity or the person

entitled to gratuity

Compulsory insurance/ Gratuity fund:

Insurance for liability to pay gratuity

Gratuity trust can be formed if strength exceed 500

Protection of gratuity against attachment:

When payable to the employee – not attachable in execution of an any

order of the court

Attachable when payable to the legal heirs of the employee

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The Tamil Nadu Industrial Establishment

(National and Festival Holidays) Act – 1958

Object:

An act to provide for the grant of National and Festival holidays to persons

employed in the Industrial establishment in the state of TamilNadu

Applicability:

It is applicable to all factories and establishment in TamilNadu- it dose not applyto employees in a position of management and employees whose work involves

travelling. Also does not include Government, Banks, Railway establishments’

mines, and oil fields.

National Holidays:

4 days are declared national holiday under the act – 26th January 1st May, 15th

August and 2nd October. These 4 days shall be allowed as holiday to allemployees each year.

Festival Holidays:

In addition to the 4 National Holidays, every year 5 Festival Holidays shall be

declared to all employees. This is to be done in consultation between the

employer and employees and should be approved by the Inspector of Factories.

Wages:

Full wages will be paid for the 4 national holidays. For the 5 festival holidays full

wages are payable if the employee has been in service under the employer for

at least 30 days within continuous period of 90 days immediately preceding

such holidays.

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Work on holidays:

An employee may be required to work on any of the said holidays; this is

permitted provided

•

He is given 24 hours’ notice in writing• Notice is sent to the concerned inspector and a copy displayed in the factory

in Form V A.

In such cases the employee has a choice:1. He can take double wages;

2. He can take single wages and one day off either three days before or three

days after the said day

Rights and privileges under other laws etc:

If an employee is entitled to better privileges by virtue of any other law, custom,

contract or usage, nothing in this act shall affect such privileges

Penalties:

An employer who contravenes any of the provision shall be punishable by fine of

Rs.25/-for the first offence and up to Rs.250/- for subsequent offences.

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The Employee’s State Insurance Act – 1948

Object:

Provide social protection to workers in contingencies such as illness,

maternity and employment injury

Applicability: Factories covered under factories Act and falling within notified area

Other establishment wherein 20 more persons are employed

Employees covered under ESI Act are exempted from these Acts

Maternity Benefit Act 1961 and

Workmen’s compensation Act 1923

Employee covered:

An employee drawing wages up to Rs 10,000/- per month

Excluding Apprentices engaged under the apprentices Act 1961.

Employees in branch of main establishment – whether covered

If the main establishment is covered under ESI Act , the branches of such

establishment irrespective of the number of employees, will be covered

under the Act (if the branch office is situated in the Not notified area, that

particular branch may be excluded from the provisions).

Registration of Establishment or factory:

Employer to register the factory / Establishment with the ESI corporation (at

its appropriate regional office) within 15 days of the applicability of the Act.

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Registration of Employees:

An employees entitled to the benefit under the Act are required to the

registered

Wages Defined:

“Wages” means all remuneration paid. or payable in cash including any

payment for period of authorized leave, lockout , strike (legal) lay off and

any other additional remuneration paid at intervals of less than two months ,

but excludes

Employer’s contribution to any pension, provident fund and ESI fund

Any traveling allowance, or concession e.g. cycle allowance

Reimbursement of any special expenses

Gratuity payable or discharge

Washing allowance

Identity card:

Every member employee shall be provided with a permanent identity card

Contributions:

Employer – 4.75% of the wages

Employee – 1.75% of the wages

Exception – Employee drawing an average daily wages equal to Less than Rs

25/-are exempted from employees Contribution.

Responsibility:

Employer to deposit his own as well as the employee contribution in respect of

all employees including the contract Labour in the ESI account.

Deductions:

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Employer’s contribution not to be deducted from the wages of any employee

Recovery of contribution in respect of contract Labour:

Principal employer to deduct the contribution of both employer and employeesfrom the bills of the contractors.

Time and mode of deposit:

Contribution to be paid into ESI account in state bank of India

To be remitted on or before the 21st of every month

Standard Benefit Rate:

Benefits available under the scheme are linked to the standard benefit rate

which is in turn linked the average daily wages of the employee

Average Daily wages STD Benefit rate

Below Rs 28/ Rs 14/-

Rs 236/- and above Rs 125/-

Sickness benefit:

Benefits payable - Every insured employee is entitled to cash benefit

Contribution by the insured employee for not less 78 days in the contribution

period

Benefit at the standard benefit rate

Benefit not Payable:

Days worked

Leave with wages

Holiday or strike

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However, sickness benefits shall be allowed to the employee for any day on

which he remains on strike if he has been under treatment;

No sickness benefit shall be payable for the first two days of sickness

The restriction will be waived if the employee falls sick within a period 7 daysafter the first sickness

Sickness benefit is restricted to maximum of 91 days in any two consecutive

benefit period.

Maternity Benefit:

Cash benefits in case of

Confinement

Miscarriage

Medicaltermination of pregnancy

Pre- mature birth of a child

Sickness arising from pregnancy of miscarriage

Contribution at least for 70 days

Benefit payable is twice the standard benefit rate.

Benefit payable at the time of:

Confinement

12 weeks not more than six weeks preceding the date of confinement

Death of the woman during or after delivery

12 weeks not more than six weeks preceding the date of confinement

Death of the woman and the child up to the date of death of child

Miscarriage or medical termination

Six weeks following the date of miscarriage, etc

Post confinement sickness

Additional period of one month following the aforesaid period.

Medical Bonus:

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Rs 250/- as confinement expenses case of non- - availability of the medical

facility under the scheme.

Disablement benefit: An employee injured in the course of employment and is permanently of

temporarily disabled or contacts any occupational disease

Disablement benefit payable in the form of cash in installment

The benefits payable:

For temporary disablement of not less than three days and permanent total

disablement At the rate of 40% more than the standard benefit rate.

For permanent partial disablement Percentage of the losses of earning

capacity more than the standard benefit rate

Benefit not to be combined:

Eligible for any one of the benefits

Sickness benefit or maternity benefit.

Sickness benefit or disablement benefit for temporary disablement

Maternity benefit or disablement benefit for temporary disablement

Dependent’s Benefit:

Death of an employee in the course employment

Dependents entitled for pension

Pension is payable at 40% more than the standard benefit rate.

Medical Benefit:

Treatment at ESI hospital/ dispensary to the employee and his family

members.

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Eligible for benefit even after retirement / superannuation on lump sum

payment

Funeral Expenses:Max. Of 1500/- to the family of the deceased

Claim to be made within three months

The employer must not employ any sick employee unless he submits the

certificate of fitness from the ESI dispensary or hospital

Employer in receipt of any benefits under the scheme is not to be dismissed

or punished

The following Registers to be maintained under various ActsForm. No.

Section Rule Purpose Remarks

FACTORIES ACT

6 15 22 Humidity register

There shall be a competentperson nominated by themanager and approved bythe inspector recordingshould be done 3times aday.

7 11(1) 16Record pointing timewashing ,white washingetc

It should be done once in 14months an recorded in theregister

8 31 56Report of examinationof pressure vessel orplant.

To be signed by the

competent authority. Areport to be sent to the If bythe competent person within7 days of completion of examination.

8A - 56AReport of examinationof water sealed gasholders

To be done one a year. Tobe maintained by thefactory manager.

10 59 (5)B 78 OT muster roll forexempted workers

To be maintained by theemployer once exemption is

31



got for OT under sec51.52,53,54,55,&56

12 62(1) 80Register for adultworkers

As & when new employeereport for duty

15 83 87&88 Register of leave withwages

This shall be presented for aperiod of 3 years after thelast entry in it

1710(4) &

87103 Health Register

Once in a year employeeshall be checked andrecorded in the register. Incase of dangerousoperations details to bedealt u/s 87, rule 95.

25 62 103 Muster roll

If daily attendance is notedin form 12, this is not

required to be preserved for3 year from last enquiry.

25A 62 103AMuster roll for adultworkers

To be marinated forovertime hours done .if palsy approved this canexempted to be preservedfor 3year

25B 62 103 B Time cardIf pay slip approved, this canbe exempted to bepreserved for three years.

26 - 104(1)

Register of accident To be entered as & whendangerous accident occur tobe preserved for 3 year

26A - 104(2)Register of dangerousoccurrences

To be entered as & whendangerous accident occur tobe presented for 3 years

Form. No.

Section Rule Purpose Remarks

28 - 105(b)

Maintenance of

exempting under theact ,granted

As & when exemptions areobtained has to be entered.

Book shall be kept forinspection ready at anytime.

29 -105(b)

106Showing the particularof forms in a factory

As when newrooms/buildings areconstructed to be entered

35 22 53(3) Register of trained adultworker

This register is for workerswho have specially trainedfor work on certain machinewhich are considered

32



dangerous as per the Act

36 29 55 Register of hoists lifts

The factory has to submit anamount as specified by theIF after the remittance acompetent authority Cheque

the hoists & lifts this has tobe done in 6 month

38 35 58Record of eyeexamination

To be done for fork liftoperation

MINIMUM WAGES (TN) RULE

I 18 21(4)

Register of fines To be maintained by theemployer fine not exceeds3% of the wages payable tothe employer.

PAYMENT OF BONUS RULES

A 2(4) 4(a)

Computation of allocable surplus seton setoff of allocable

surplus

To be maintained byemployer

B 15 4(b)Bonus paid to

employee for theallocable surplus

------------ do ----------

C 17,18 4(c)Bonus paid to

employee for the

accounting year

------------ do ------------

PAYMENT OF WAGES(TN) RULES

I 8(1) 3 Register of fines

No fine shall be imposeduntil the employer hasobtained approval from theinspector. Notice specifyingact and omissions shall beexhibited. Fine shall notexceed 3% of the employeewages no fine to be imposedon employee under the wageof 15 years fine deducted ininstallment shall not exceed60 days from the date onwhich it was imposed.

ESI RULE

VII 32 Register of employee To be maintained byemployer & preserved for aperiod of 5 years.

XV 66 Accident register -------- do ----------

33



First aid registerNot prescribed in the format.But employer should makean entry.

NON DISPLAYBLE NOTICE

Form Section RulePurpose (Factories

Act)Remarks

3A 7(4) 12AChange of managernotice

To be sent within 7 daysfrom the date on which thenew manager takes charge.

18 88 96B Report of accident

To be sent within 12 hours of the accident. If workers dosenot report to duty within 48hours of the accident themanagers shall send a reportwithin 24 hours after theexpiry of 48 hours

18A 88A 96(3)Report of dangerousoccurrences

-------------------------------

18B 88 96(6)Report of furtherdetails of accident

Report to be sent once every15 days till worker report toduty

The following returns to be submitted under various Acts.

Form Section Rule Periodicity Purpose RemarksFACTORIES ACT

21 110 100(1)Once in a 6

months

Half yearly returnfor half yearending 30 June

-----

22 110 100(2) AnnualReturn for theyear ending 31

December

-----

EMPLOYMENT EXCHANGE RULES

ERI 5 6Once in 3

month

Quarterly returnfor the quarterlyended

-----

ERII 5 6Once in 2

yearOccupationalreturns

----

EMPLOYEES PROVIDENT FUND SCHEME5& -- 36 Monthly Return of To be sent along

34



10additional &deletion

with form 2

12A ---- MonthlyDetails of contribution paid

Return of contributionrecovered paid to

the commissionerForm Section Rule Periodicity Purpose Remarks

3A 43 yearlyReturn of contribution

Every employershall send this formalong with theconsolidatedstatement withinone month fromthe date of expiryof currency period.

When a memberleaves a services,the employer shallsend thecontribution cardbefore the 20th dayof the month

6A ----- 38(3) Annual

Consolidatedannualcontributionstatement

To send within onemonth of close, of period of currencythis form showing

total amount of recoveries madeduring the period.

TNLWB

2 6(3) Half yearly Return

To be sent alongwith form 1 shouldobtainacknowledgementfor furnishing of particulars.

A 15 12(4) Annual

Statementshowing theparticular of contributionamount paid.

No of employeepaid the welfarecontribution of theemployee as wellas employedcontribution paid.

2 ---- 4 Half yearly Half yearlyreturns

Particular showingthe name of theemployee offencemade by him dateof suspension and

35



details of subsistenceallowance paid.

V 3 5(1) AnnualStatement of national &festival

holidays

Approved list dulysigned by the

employer

The following notices should be displayed under variousActs.

Formno

Section RuleTo be sentto whom

Purpose Remarks

FACTIRIES ACT

1161,72.10

879

Inspector of factories

Notice of period of work inform 11both English and Tamil

Prescribed forrelays, group.Nature of ownslunch and breaksand weekly holidayetc to be induplicate anyproposed change inthe system of workhas to be notified.

NATIONAL FESTIVAL HOLIDAY ACT

II 3 3(2) IFNotice by theemployer

Deceleration of holiday objectives

to be sent within aperiod of 15 daysfrom the date onwithin the noticewas displayed

Formno

Section RuleTo be sentto whom

Purpose Remarks

III 3,3(5) 4(4) Employer Notice finalapproval of theinspector

To be displayedwithin 7 days of receipt if

36



communication induplicate this willtake effect from thefirst day of thecalendar year

V 5(2) 6A If employeeNotice to employeeto work on aholiday

In duplicate sign tobe obtained fromthe employee.

MINMIUM WAGES ACT

VI 26(3) 6ANotice of rule of wages to be paid

Where there aremore than 100employee noticehas be displayedseparately for eachsection in the

departmentPAYMENT OF GRATUITY ACT

A 3(1) Notice of openingWithin 30 days of the act becomingapplicable

APPLICATIONS

Form Section RuleTo be sentto whom

PurposeFactories act

Remarks

FACTORIES ACT

1 7 3

To apply forpermission toconstruct extend ortake into use anybuildings

In triplicate toapply before onemonth

2 6(1) 4,6

Application for

registration &grantof renewal of license

In triplicate to

apply before 30th

October everyyear in case of yearly renewal. Incase of owners toapply two monthbefore theexpiring of theperiod

ESI ACT

37



1210B

Apr regionalofficer

Employerregistration form

Upon receivingthis form, if theregional office issatisfied it willallot the code no

information theemployee

Form Section RuleTo be sentto whom

Purposefactories act

Remarks

I 11 ---- do ----

Declaration formby an employer

The employershall requireevery employeeto furnishparticular

required in thisform

IA 15A --- do ----

Family declarationform

Every insuredperson shallfurnish particularof his family thishas to be sentwithin 10 days

IB 15B --- do ---- Changes in form IA ----- do-----

EMPLOYEES PROVIDENT FUND ACT

27Commissione

r

Exemption To apply forexemption forcertain classes of employees

MINIMUM WAGES ACT

VI 20(2) 27Commissione

rApplication by aemployer

PAYMENT OF GRATUITY

I 4(1) 7(1) Employer

Application for

gratuity by anemployee

To apply within 30

days of Superannuationor retirement

J 4(1) 7(2) EmployerApplication forgratuity by anominee

Within 30 days

K 4(1) 7(3) EmployerApplication by legalheir

Within one year

38

statutes governing factory management

Documents