It is estimated that nearly half the existing number of factories will be outside the purview of the Factories Act if the amendment Bill pending before Parliament becomes law.
It was passed by the Lok Sabha in the Budget session. It amends the existing threshold of the number of workers employed for being applied, from 10 workers if there is electricity and 20 without to 20 and 40 workers, respectively. Effectively, this would cover five per cent of the workforce employed in factories.
According to PRS Legislative Research, which culled the data from the Annual Survey of Industries 2011-2012, 36 per cent of factories employ up to 14 workers and 11 per cent employ 15 to 19 each on their premises.
The Bill also proposes to allow state governments to raise the threshold permitted in the law if they want to. Bharatiya Janata Party-ruled Rajasthan has already been in the news for making substantial changes in its labour laws; the changes are pending before the President of India for clearance.
The amendment changes the definition of ‘factory’, resulting in exemption of five per cent of the work force in such units from mandated wages, working hours, etc. Other changes include raising the threshold for overtime in factories from the existing 50 hours in any quarter to 100 hours in any quarter. States may raise that to 115 hours.
Trade unions have alleged the provisions are slanted in favour of employers. The earlier penalty for several offences, which included a prison term of two years, plus a fine, is now being limited to a fine up to Rs 1.5 lakh.
A Bill to amend the existing Apprentices Act has been passed by the Lok Sabha, where the ruling party has a big majority. Critics point to the low proportion of apprenticeships in industry and the many vacancies in this regard, going by even official data. With the dilution of the earlier penalties, contend the Left parties, employers would get off lightly in this regard.
