A project report on labour welfare

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Social Security and Labour Welfare in India: A review

Social security is one of the pillars on which the structure of a welfare state rests,
and it constitutes the hard core of social policy in most countries. It is through
social security measures that the state attempts to maintain every citizen at a
certain prescribed level below which no one is allowed to fall. It is the security
that society furnishes through appropriate organization, against certain risks to
which its members are exposed (ILO, 1942). Social security system comprises
health and unemployment insurance, family allowances, provident funds,
pensions and gratuity schemes, and widows’ and survivors’ allowances. The
essential characteristics of social insurance schemes include their compulsory and
contributory nature; the members must first subscribe to a fund from which
benefits could be drawn later. On the other hand, social assistance is a method
according to which benefits are given to the needy persons, fulfilling the
prescribed conditions, by the government out of its own resources.
The present section reviews labour welfare activities in India with
particular emphasis on the unorganized sector. Although provisions for
workmen’s compensation in case of industrial accidents and maternity benefits
for women workforce had existed for long, a major breakthrough in the field of
social security came only after independence. The Constitution of India (Article
41) laid down that the State shall make effective provision for securing the right
to public assistance in case of unemployment, old age, sickness and disablement
and in other cases of underserved want. The Government took several steps in
compliance of the constitutional requirements. The Workmen’s Compensation
Act (1926) was suitably revised and social insurance programmes were
developed for industrial workers. Provident funds and gratuity schemes were
introduced in most industries, and maternity legislation was overhauled.
Subsequently, State governments instituted their own social assistance
programmes. The provisions for old age comprise pension, provident fund, and
gratuity schemes. All the three provisions are different forms of retirement
benefits. Gratuity is a lump sum payment made to a worker or to his/her heirs by
the company on termination of his/her service due to retirement, invalidity,
retrenchment or death (Vajpayee and Shanker, 1950).



Welfare

Welfare is the provision and maintenance of the conditions of life for
individuals by the community.
Welfare has a positive and negative aspect. Negative welfare is the provision
by the state or other institutions of a “safety net” or the distribution of
benefits according to some criteria; so-called positive welfare is the
provision of opportunities for people to “help themselves”. This contrast lies
behind foreign-aid strategies which concentrate on providing skills or “seed
capital” rather than food parcels, for example. The concept of positive and
negative welfare is related to the concepts of positive and negative freedom.
Marxists support both positive and negative welfare, but recognise that the
market inevitably generates inequality and a class of people inevitably the
recipients of welfare, who have nothing to sell but their labour power,
alongside a class of people who live off the proceeds of exploitation,
invariably the providers of welfare. Only by bringing the means of
production under thorough going proletarian democracy can the very need
for welfare be abolished.

Concept of labour welfare
The concept of labour welfare is flexible and elastic and differs
widely with time, region, industry, social values and customs, degree of
industrialization, the general socio-economic development of the people and
the political ideologies prevailing at a particular time. It is also moulded
according to the age-groups, socio-cultural background, marital and
economic status and educational level of the workers in various industries
In its broad connotation, the term welfare refers to a state of living
of an individual or group in a desirable relationship with total environment –
ecological, economic, and social. Conceptually as well as operationally,
labour welfare is a part of social welfare which, in turn, is closely linked to
the concept and the role of the State. The concept of social welfare, in its
narrow contours, has been equated with economic welfare. As these goals
are not always be realised by individuals through their efforts alone, the
government came into the picture and gradually began to take over the
responsibility for the free and full development of human personality of its
population.



Labour welfare is an extension of the term Welfare and its
application to labour. During the industrialisation process, the stress on
labour productivity increased; and brought about changes in the thinking on
labour welfare. An early study under the UN observed as follows “in our
opinion most underdeveloped countries are in the situation that investment
in people is likely to prove as productive, in the purely material sense, as any
investment in material resources and in many cases, investment in people
would lead to a greater increase of the flow of goods and services than
would follow upon any comparable investment in material capital” (UN,
1951). The theory that welfare expenditure, especially expenditure on health
and education, is productive investment has led to the view that workers
could work more productively if they were given a fair deal both at the work
place and in the community.
The concept of labour welfare has received inspiration from the
concepts of democracy and welfare state. Democracy does not simply denote
a form of government; it is rather a way of life based on certain values such
as equal rights and privileges for all. The operation of welfare services, in
actual practice, brings to bear on it different reflections representing the
broad cultural and social conditions. In short, labour welfare is the voluntary
efforts of the employers to establish, within the existing industrial system,
working and sometimes living and cultural conditions of the employees
beyond what is required by law, the custom of the industry and the
conditions of the market (A. J. Todd, 1933).
The constituents of labour welfare included working hours,
working conditions, safety, industrial health insurance, workmen’s
compensation, provident funds, gratuity, pensions, protection against
indebtedness, industrial housing, rest rooms, canteens, crèches, wash places,
toilet facilities, lunches, cinemas, theatres, music, reading rooms, holiday
rooms, workers’ education, co-operative stores, excursions, playgrounds,
and scholarships and other help for education of employees’ children.
However, labour welfare has both positive and negative sides
associated to it. On the positive side, it deals with the provision of
opportunities which enable the worker and his family to lead a good life,
socially and personally, as well as help him to adjust social transition in his
work life, family life and social life. On the negative side it functions in
order to nutralise the baneful effects of large scale industrialization and
provide a
counterbalance to the undesirable social consequences and labour problems
which have evolved in the process of this transition.



The word labour means any productive activity. In a broader
sense, therefore, the phrase labour welfare means the adoption of measures
to promote the physical, social, psychological and general well-being of the
working population. Welfare work in any industry aims, or should aim, at
improving the working and living conditions of workers and their families.

Definitions:
Labour welfare has been defined in various ways, though
unfortunately no single definition has found universal acceptance. The
Oxford Dictionary defines labour welfare as “efforts to make life worth
living for worker”
Chamber’s Dictionary defines welfare as “a state of faring or
doing well; freedom from calamity, enjoyment of health, prosperity.”
The ILO report refers to labour welfare as “such services,
facilities, and amenities, which may be established in, or in the vicinity of
undertakings to enable persons employed therein to perform their work in
healthy and congenial surroundings and provided with amenities
conducive to good health and high morale”.

Features:
On the basis of the various definitions, the basic characteristics of
labour welfare work may be noted thus:
1. It is the work which is usually undertaken within the premises or in the
vicinity of the undertakings for the benefit of the benefit of the employees
and the members of their families.
2. The work generally includes those items of welfare which are over and
above what the employees expect as a result of the contract of service from
the employers.
3. The purpose of providing welfare amenities is to bring about development
of the whole personality of the worker -his social, psychological, economic,
moral, cultural and intellectual development to make him a good worker, a
good citizen and a good member of the family.
4. These facilities may be provided voluntarily by progressive and
enlightened entrepreneurs at their own accord out of their realization of
social responsibility towards labour, or statutory provisions may compel
them to make these facilities available; or these may be undertaken by the



government or trade unions, if they have the necessary funds for the
purpose.
5. Labour welfare is a very broad term, covering social security and such
other activities as medical aid, crèches, canteens, recreation, housing, adult
education, arrangements for the transport of labour to and from the work
place.
6. It may be noted that not only intra-mural but also extra-mural, statutory as
well as non-statutory activities, undertaken by any of the three agencies- the
employers, trade unions or the government- for the physical and mental
development of the worker, both as a compensation for wear and tear that he
undergoes as a part of the production process and also to enable him to
sustain and improve upon the basic capacity of contribution to the processes
of production, “which are all the species of the longer family encompassed
by the term ‘labour welfare’.

Concept of labour welfare
In its broad connotation, the term welfare refers to a state of living of an
individual or group in a desirable relationship with total environment –
ecological, economic, and social.
Conceptually as well as operationally, labour welfare is a part of social
welfare which, in turn, is closely linked to the concept and the role of the
State. The concept of social welfare, in its narrow contours, has been
equated with economic welfare. Pigou defined it as “that part of general
welfare which can be brought directly or indirectly into relations with the
measuring rod of money” (Pigou, 1962). According to
Willensky and Labeaux, social welfare alludes to “those formally
organised and socially sponsored institutions, agencies and programmes
which function to maintain or improve the economic conditions, health or
interpersonal competence of some parts or all of a population” (Willensky
and Labeaux, 1918). As these goals may not always be realised by
individuals through their efforts alone, the government came into the picture
and gradually began to take over the responsibility for the free and full
development of human personality of its population.
Labour welfare is an extension of the term Welfare and its
application to labour. During the industrialisation process, the stress on



labour productivity increased; and brought about changes in the thinking on
labour welfare. An early study under the UN observed as follows “in our
opinion most underdeveloped countries are in the situation that investment
in people is likely to prove as productive, in the purely material sense, as any
investment in material resources and in many cases, investment in people
would lead to a greater increase of the flow of goods and services than
would follow upon any comparable investment in material capital” (UN,
1951). The theory that welfare expenditure, especially expenditure on health
and education, is productive investment has led to the view that workers
could work more productively if they were given a fair deal both at the work
place and in the community.
The concept of labour welfare has received inspiration from the
concepts of democracy and welfare state. Democracy does not simply denote
a form of government; it is rather a way of life based on certain values such
as equal rights and privileges for all. The operation of welfare services, in
actual practice, brings to bear on it different reflections representing the
broad cultural and social conditions. In short, labour welfare is the voluntary
efforts of the employers to establish, within the existing industrial system,
working and sometimes living and cultural conditions of the employees
beyond what is required by law, the custom of the industry and the
conditions of the market (A. J. Todd, 1933).
The constituents of labour welfare included working hours,
working conditions, safety, industrial health insurance, workmen’s
compensation, provident funds, gratuity, pensions, protection against
indebtedness, industrial housing, rest rooms, canteens, crèches, wash places,
toilet facilities, lunches, cinemas, theatres, music, reading rooms, holiday
rooms, workers’ education, co-operative stores, excursions, playgrounds,
and scholarships and other help for education of employees’ children.

Labour and Labour Welfare
Labour sector addresses multidimensional socio-economic aspects affecting
labour welfare, productivity, raising living standard of labour force and
social security. To raise earnings of work force and achieve higher
productivity, skill upgradation through suitable training is of utmost
importance. Manpower development to provide adequate labour force of
appropriate skills and quality to different sectors essential for rapid socio-
economic development and elimination of the mismatch between skills
required and skills available has been a major focus of human resource



development activities during the last fifty years. Employment generation in
all the productive sectors is one of the basic objectives. In this context,
providing enabling environment for self employment has received special
attention both in urban and rural areas. Objective is also to eliminate bonded
labour, employment of children and women in hazardous industries, and
minimize occupational health hazards. During the Ninth Plan period,
elimination of such undesirable practices as child labour, bonded labour,
ensuring workers’ safety and social security, looking after labour welfare
and providing of the necessary support measures for sorting out problem
relating to employment of both men and women workers in different sectors
will receive priority attention. It is also envisaged that the employment
exchanges will be reoriented so that they become the source of labour
related information, employment opportunities and provide counseling and
guidance to employment seekers.

All labour welfare measures have the following objectives:
1. Enabling workers to live richer and more satisfactory lives;
2. Contributing to the productivity of labour and efficiency of the enterprise;
3. Enhancing the standard of living of workers by indirectly reducing the
burden on their purse;
4. Enabling workers to live in tune and harmony with services for workers
obtaining in the neighbourhood community where similar enterprises are
situated;
5. Based on an intelligent prediction of the future needs of the industrial
workers, designing policies to cushion off and absorb the shocks of
industrialisation and urbanisation to workers;
6. Fostering administratively viable and essentially developmental outlook
among the workforce; and
7. Discharging social responsibilities.



Principles of labour welfare
Certain fundamental considerations are involved in the concept of labour
welfare. The following are the more important among them.

Social responsibility of industry
This principle is based on the social conception of industry and its role in the
society that is, the understanding that social responsibility of the state is
manifested through industry. It is assumed that labour welfare is an
expression of industry’s duty towards its employees.
Social responsibility means that the obligation of the industry to pursue
those policies, to take such decisions, and to follow those lines of action
which are desirable in terms of the objectives and values currently obtaining
in the society. The values of the Indian community are enshrined in the
constitution of the country. Labour welfare is not embroidery on capitalism
nor the external dressing of an exploitative management; rather, it is an
expression of the assumption by industry of its responsibility for its
employees (Maurioce Bruce, 1961). Industry is expected to win the co-
operation of the workers, provide them security of employment, fair wage,
and equal opportunity for personal growth and advancement, and make
welfare facilities available to them.

Democratic values
The principle of democratic values of labour welfare concedes that workers
may have certain unmet needs for no fault of their own, that industry has an
obligation to render them help in gratifying those needs, and that workers
have a right of determining the manner in which these needs can be met and
of participating in the administration of the mechanism of need gratification.
The underlying assumption to this approach is that the worker is a mature
and rational individual who is capable of taking decisions for
himself/herself.

Adequacy of wages
The third principle of labour welfare is adequacy of wages; it implies that
labour welfare measures are not a substitute for wages. It will be wrong to
argue that since workers are given a variety of labour welfare services, they
need be paid only low wages. Right to adequate wage is beyond dispute.



Efficiency
The fourth principle of labour welfare lays stress on the dictum that to
cultivate welfare is to cultivate efficiency. Even those who deny any social
responsibility for industry do accept that an enterprise must introduce all
such labour welfare measures which promote efficiency (Marshall, 1950). It
has been often mentioned that workers’ education and training, housing, and
diet are the three most important aspects of labour welfare, which always
accentuate labour efficiency.

Re-personalization
Since industrial organisation is rigid and impersonal, the goal of welfare in
industry is the enrichment and growth of human personality. The labour
welfare movement seeks to bring cheer, comfort, and warmth in the human
relationship by treating man as an individual, with quiet distinct needs and
aspirations. Social and cultural programmes, recreation and other measures
designed after taking into consideration the workers’ interests go a long way
in counteracting the effects of monotony, boredom, and cheerlessness.

Co-responsibility
The sixth principle of labour welfare recognises that the responsibility for
labour welfare lies on both employers and workers and not on employers
alone (Moorthy, 1958). Labour welfare measures are likely to be of little
success unless mutuality of interest and responsibilities are accepted and
understood by both the parties, in particular the quality of responsibility at
the attitudinal and organisational level.

Totality of welfare
The final principle of labour welfare is that the concept of labour welfare
must permeate throughout the hierarchy of an organisation, and accepted by
all levels of functionaries in the enterprise.

Approaches
The issue of labour welfare may be studied from different angles, such as:
• The location, where these amenities are provided, within and outside
the industrial undertakings;
• The nature of amenities such as those concerned conditions of
employment and
• The welfare activities termed as ‘statutory’, ‘voluntary’ and ‘mutual’.



• The agencies which provide living conditions of work people; these
amenities.
• On the basis of location of welfare activities, labour welfare work has
been classified by Broughton in two specific categories, namely,
(a)intramural(b)extra-mural
(a)Intra-mural activities: consist of such welfare schemes provided within
the factories as medical facilities, provision of crèches, and canteens, supply
of drinking water, washing and bathing facilities, provision of safety
measures such as fencing and covering of machines, good lay-out of
machinery and plant, sufficient lighting, first-aid appliances; activities
relating to improving conditions of employment, recruitment and discipline
and provision of provident fund and gratuity, maternity benefits,etc.
(b)Extra-mural activities: cover the services and facilities provided outside
the factory such as, housing accommodation, indoor and outdoor recreation
facilities, amusement and sports, educational facilities for adults and
children, provision of libraries and reading rooms.
In the welfare activities concerned with conditions of employment
are included activities for the management of problems arising out of hours
of work, wages, holidays with pay, rest intervals, sanitation, continuity of
employment, control over the recruitment of female and juvenile labour,
while all such schemes of benefits as co-operative societies, legal and
medical aid, and housing are included in the category of activities concerned
with conditions of workers.
Labour welfare work may be statutory, voluntary or mutual. It is
statutory when such activities have to be undertaken in furtherance of the
legislation adopted by the government. It is voluntary when the activities are
undertaken at their own accord by the employers or some philanthropic
bodies or when a labour organisation undertakes such activities for the
welfare of their members. It is mutual, when all parties join hands to bring
about the social and economic uplift of the workers.
The National Commission on labour has classified various labour
welfare measures under two distinct classes:
(1)those which have to be provided, irrespective of the size of the
establishment or the number of the persons employed therein such as
facilities relating to washing, storing, drying the clothing, first-aid, drinking
water, latrines and urinals
(2)those which are to be provided subject to the employment of a specified
number of persons, such as canteen, rest shelter, crèche, ambulance,etc.
According to the Encyclopedia of social sciences, “industrial
welfare work ”has taken numerous forms such as:



(a)those dealing with immediate working conditions are special provisions
for adequate light, heat, ventilation, toilet facilities, accident and
occupational disease prevention, lunch room, rest room, maximum hours,
minimum wages,etc.;
(b)those concerned with less immediate working conditions and group
interests, are gymnasiums ,club rooms, play grounds, gardens, dancing,
music, house organs, mutual aid societies, vacation with pay, profit-sharing,
stockownership, disability and unemployment funds, pensions, savings
banks, provisions for conciliation and arbitration, shop committees and
workers councils;
(c)those designed to improve community conditions, such as housing, retail
stores, schools, libraries, kinder gardens, lectures on domestic sciences, day
nurseries, dispensary and dental service screening of motion pictures,
arranging athletic contests and picnics and summer camps.

Scope of labour welfare work
It is somewhat difficult to accurately lay down the scope of labour welfare
work, especially because of the fact that labour class is composed of
dynamic individuals with complex needs.
In a world of changing values, where ideologies are rapidly
undergoing transformation, rigid statements about the field of labour welfare
need to be revised. Labour welfare work is increasing with the growing
knowledge and experience of techniques. An able welfare officer would ,
therefore, include in his welfare programme the activities that would be
conducive to the well-being of the worker and his family. The test of the
welfare activity is that it removes, directly or indirectly, any hindrance,
physical or mental of the worker and restores to him the peace and joy of
living the welfare work embraces the worker and his family
The following list, which is by no means exhaustive, gives the items
under which welfare work should be conducted inside and outside the work
place:

(1)Conditions of work environment:
The workshop sanitation and cleanliness, humidity, ventilation, lighting,
elimination of dust, smoke, fumes and gases, convenience and comfort
during work, operative postures, sitting arrangements etc; distribution of
work hours and provision for rest times, breaks and workmen’s safety
measures.



(2)Workers health services.
These should include factory health centre; medical examination of workers,
factory dispensary and clinic for general treatment; infant welfare; women’s
general education; workers recreation facilities; education, etc;

(3)Labour welfare programme:
These should cover factory council consisting of representatives of labour
and employers; social welfare departments; interview and vocational testing;
employment, follow-up, research bureau; workmen’s arbitration council.

(4)Labour’s Economic welfare programme:
These should include co-operatives or fair price shops for consumer
necessities; co-operative credit society, thrift schemes and savings bank;
health insurance; employment bureau; etc.

(5)General welfare work:
This should relate to housing and family care.

Central Sector

There are Four types of initiatives through the Plan for the Labour and
Labour Welfare Sector. They are:

i. Training for skills development
ii. Services to job seekers
iii. Welfare of Labour
iv. Administration of Labour regulations

Many initiatives are taken for the benefit of workers through the plans of a
number of Labour Intensive Sectors. These are not discussed here because
they fall under the purview of respective sectoral programmes of the plan.

Vocational Training/Skill Development Training

The primary purpose of vocational training is to prepare individuals,
especially the youth in the age group of 15-25 years, for the world of work
and make them employable for a broad group of occupations. The main



vocational training schemes comprise of Craftsmen Training scheme,
Apprenticeship Training scheme, Training of Skilled Workers, Training of
Women as a special target group, Training of Craft Instructors, Training of
Supervisors and Foremen. Applied research on vocational training problems
is carried out. Preparation and development of instructional material is
another area where appropriate attention is being paid.

Craftsmen Training scheme and Apprenticeship Training scheme, which are
adequately dovetailed and meant to bring maximum benefit to the youth in
their formative years, form the core of the vocational training schemes.
Other vocational training schemes, though smaller in magnitude, also serve a
very useful and essential purpose in the overall sphere of vocational training.
In spite of difficulties and shortcomings, the vocational training schemes
have continued to make progress specially in term of being the primary
source of manpower for industry. The schemes being well standardized and
having national coverage, enjoy a fairly high crediability.

The Central Government mainly concentrates on laying down the policies,
procedures and training standards while the administrative aspect of the
Industrial Training Institutes (ITIs) is taken care of by the concerned State
Governments/UTs. In this process, the Central Government is advised by
two advisory tripartite bodies namely, National Council for Vocational
Training (NCVT) and the Central Apprenticeship Council (CAC). Both the
councils have the Union Labour Minister as the Chairman.

Craftsmen Training Scheme

Craftsmen Training Scheme(CTS)under the National Vocational Training
System was introduced in 1950 for imparting skill training.

Training is imparted mainly in engineering trades. A few trades out side the
engineering field are also covered but the bulk of the services sector and
other needs of industries other than manufacturing, are not handled by
DGE&T.

Two major resources for such training are the Industrial Training Institutes
(ITIs) and the 25000 industrial establishments that take part in Apprentice
Training. There has been a significant growth and expansion in the network
of ITIs which have grown to 4086 in the public and private sector with a
seating capacity of 6.41 lakh as on 31.12.1998 (State-wise details presented
in Annexure 5.7.3) and another 2.59 lakh under the Trade Apprentice



Scheme. Apprenticeship training scheme provides practical training in 135
designated trades to train apprentices in 97 subject fields in engineering and
technology for graduates and diploma holders and 94 subject fields for
technicians.

The National Vocational Training Institute at NOIDA (UP) and the Regional
vocational Training Institutes for Women in different parts of India impart
basic and advance levels of vocational training to women. A women's cell
under the office of DGE&T is also coordinating with the states in the matter
of vocational training for women. In the Ninth Plan, a Centrally Sponsored
Scheme "Establishment of new ITIs in the North Eastern States and in
Jammu and Kashmir" is proposed.

The existing training institutions have, no doubt, been meeting a significant
part of the requirements of the skilled manpower of the organised industry.
It, however, seems necessary that the processes of restructuring and
reorientation of their courses are made more dynamic with a view to quickly
respond to the labour market. A greater involvement of industry in planning
and running the training system would also be necessary for this purpose.
For skill upgradation of the workers in the unorganised sector, flexibility in
the duration, timing and location of training courses would need to be
introduced. Since a sizeable proportion of employment would have to be
self-employment the in the tiny and small units in various sectors, the
training system should also gear up not only for providing hard skills for
suitable trades, but also the soft skills of entrepreneurship, management and
marketing, as part of the training courses.

In the changed economic scenario, where displacement of labour is
inevitable and existing labour force is expected to get retrenched, a special
training scheme is also being implemented by the Ministry of labour, so that,
the workers thus retrenched are not affected adversely. This scheme is
funded out of the National Revival fund (NRF). Under this scheme, payment
are made to the workers who are voluntarily retiring and also for retraining
and redeployment of retrenched workers.

Services to job seekers

To provide services to job seekers is another important initiative taken by
the Labour and Labour Welfare Plan. To achieve this objective, the National
Employment Service has been established.



National Employment Service

It consists of a network of 942 (as on 30.6.98) Employment Exchanges
spread throughout the country. These Employment Exchanges continue to
provide placement vocational guidance services to job seekers registered
with them. During the period January - June,1998, the Employment
Exchanges effected 1.18 lakh placements (statewise details are in annexure
4). Special emphasis was laid on promotion of self employment by suitably
motivating and guiding job seekers. Twenty three special cells have been set
up for this purpose in selected District Employment exchanges. Out of 165.8
thousand applicants on the live registers of these 23 cells about 61.1
thousand have been placed in self employment up to December 1997, by
these cell. Besides placement, Employment Exchanges also handle
Employment Market Information. The function of identifying job seekers
has been assumed now primarily by the organisations where jobs arise. The
governments now reach the job seekers directly when a sizable job demand
arises.The number of jobs in public sector has reduced sharply with the
reorientation of the role of economic planning.

The National Employment Service in the context of the newly emerging
market scenario has to be reoriented. The Employment Services has now
accepted its enhanced role and is paying greater attention to compilation and
dissemination of comprehensive labour market information. The important
reports generated by EMI are "The Quarterly Employment Review",
"Occupational and Educational Pattern in India" etc.

The Employment Service continued to pay special attention to the needs of
the weaker section of society. A comprehensive package of services to the
handicapped is provided by 17 Vocational Rehaibilitation Centres for the
Handicapped. The centre at Vadodara caters exclusively to the needs of
handicapped women. Vocational guidance and training in confidence
building is provided to job seekers belonging to the Scheduled Castes and
the Scheduled Tribes at 22 coaching cum guidance centres. Besides, the
scheme to provide facilities to SC/ST job seekers for practising shorthand
and typing is in operation in CGCs.

In addition, there are also plan schemes for modernisation and
computerisation of employment exchanges.



Welfare of labour

One of the major concerns of the Government has been the improvement of
labour welfare with increasing productivity and provision of a reasonable
level of social security. The planning process attempts to achieve these goals
by monitoring working conditions and creation of industrial harmony
through an infrastructure for healthy industrial relations.

Special drives for inspections under the Crash Programmes & Task Force
inspections were organised during the year for extending coverage of labour
laws like the Minimum Wages Act, Payment of Wages Act, Equal
Remuneration Act & Contract Labour (Regulation & Abolition) Act to
workers in the unorganised/informal sector. A total of 1074(P) inspections
under the above enactments were carried out during the year 1998 as a result
of which 15938(P) irregularities and 489(P) cases of under payments/non
payments were detected.

There are at present 12 Industrial Tribunals cum Labour Courts constituted
by Ministry of Labour dealing with industrial disputes in respect of which
the Central Govt. is the appropriate authority. Two CGIT cum Labour
Courts,one each at Lucknow and Nagpur have been set-up. It is also
proposed to open three new CGITs at Hyderabad, Bhubaneswar and
Chennai, and provide computer facilities in all the CGITs in a phased
manner. The number of Industrial Tribunals and Labour Courts set up by the
State Governments and the Administrations of the Union Territories as on
31.10.1998 was 331.

Labour Welfare Funds

The Ministry of Labour is administering five welfare funds for beedi, cine
and certain categories of non coal mine workers. the funds have been and set
up under the following Acts of Parliament:

1. The mica mines Labour Welfare Fund Act, 1946.
2. The Limestone and Dolomite Mines Labour Welfare Fund Act.
3. The Iron Ore, Manganese Ore and Chrome Ore Mines Labour
Welfare Fund Act 1976.
4. The Beedi Workers' Welfare fund Act, 1976
5. The Cine Workers Welfare Fund Act, 1981



The fund created by these acts, is used by the Central Government for the
Welfare of Workers under these occupations.

Agriculture Workers

Agriculture Workers constitute by far the largest segment of workers in the
unorganised sector. These workers get employment for less then six months
in a year and have to migrate to other ares for alternative employment.

Several measures have been taken to protect the interests of the agricultural
workers. The very first legislation-the Minimum Wages Act, 1948 is applied
to the agriculture sector also. Measures have also been taken to look into the
interest of construction workers. Many enactments were extended to the
include construction workers.

Child Labour

According to the 1991 Census, the number of working children in the
country was of the order of 11.28 million (State wise details are available in
annexure 5.7.5). The existence of child labour in hazardous industries is a
great problem in India. Non availability of accurate, authentic and up to date
data on child labour has been a major handicap in planned intervention for
eradication of this social evil. Efforts are underway in the Ninth Plan, to
modify and improve the existing National Child Labour Project. A major
activity undertaken under this scheme is the establishment of special schools
to provide non-formal education, vocational training, supplementary
nutrition, stipend, health care etc. to children withdrawn from employment
in hazardous industries. Under the existing scheme 76 National Child
Labour Projects were sanctioned in the Child Labour endemic States to
cover nearly 1.55 lakh children. According to the available information,
about 1.05 lakh children have benefitted from the special schools. State wise
coverage under National Child Labour Project is furnished at Annexure
5.7.6.

The revised scheme approved by Govternment of India in January, 1999
provides for 100 National Child Labour Projects to cover more children.



Rehabilitation of Bonded Labour

A Centrally Sponsored Scheme was launched by the Ministry of Labour in
1978-79 for the identification, release and rehabilitation of bonded labourers.
The scheme envisages provision of rehabilitation grant up to a ceiling limit
of Rs. 10,000/- per freed bonded labourer, half of which is given as central
share.

Women Labour

The Ministry of Labour has set up a Women Labour Cell in 1975. The
intention was to focus attention on the lot of working women with a view to
improving it. An important activity of the Cell is to convene the meeting of
the Central Advisory Committee which has been constituted under the Equal
Remuneration Act, 1976 and follow up the recommendations made by the
Committee. Another important activity of the Women Cell is to examine and
process project proposals to carry out studies on matters affecting women
workers and also to fund programmes aimed at improving their economic
well being. Several projects aimed at improving the working conditions of
women and raising their economic level were processed by the Women Cell
of the Ministry of Labour during 1998-99. The Cell also give grants-in-aid to
voluntary organisation to carry out research studies on problems of women
workers, their employability and the extent of their displacement on account
of technological and various other changes. This scheme was introduced
with the intention of furthering Government’s policy of helping women
workers to become aware of their rights and opportunities and also become
economically independent.

Occupational Safety and Health

The Constitution of India contains specific provisions on Occupational
Safety and Health of workers. The Directorate General of Mines Safety
(DGMS) and Directorate General of Factory Advice Service and Labour
Institutes(DGFASLI) strives to achieve occupational safety and health in
mines factories and ports. The schemes relating to occupational safety
concentrate on improvement of work environment, man-machinery
interface, control and prevention of chemical hazards, development of
protective gears and equipment, training in safety measures and
development of safety and health information system.



Directorate General of Factory Advise, Service and Labour Institutes
(DGFASLI)

This organisation functions as the technical arm of the ministry in matters
concerning with safety, health and welfare of workers in factories and ports/
docks.

Directorate General of Mines Safety (DGMS)

The Directorate General of Mines Safety which is a subordinate office of the
Ministry of Labour is entrusted with the responsibility of enforcing the
provisions of the Mines Act, 1952. With a view to ensuring enforcement of
necessary safety measures in mines, inspections and enquiries are carried out
by the inspecting officers. During the period April, 1998 to September 1998,
17 notices and 11 orders were issued to coal mines and 4 notices and 15
orders were issued to non-coal mines. The number of inspections and
enquiries carried out during this period was 4181.

Labour Statistics

The Labour Bureau is responsible for collection, compilation and
publication of statistical and other information regarding employment,
wages, earnings, industrial relations, working conditions etc. It also
compiles and publishes the consumer Price Index Numbers for industrial and
agricultural workers. The Bureau further renders necessary assistance to the
States for conducting training programmes in Labour Statistics of
State/District/Unit levels.

Workers' Education

The Central Board of Workers Education is dealing with schemes for
training of workers in the techniques of trade unionism and in bringing about
consciousness among workers about their rights, duties and responsibilities.
The Board has also undertaken programmes for rural workers' education and
functional adult education.

Labour Research and Training

The V.V. Giri National Labour Institute, a fully funded autonomous body of
the Ministry of labour, conducts action oriented research and provides
training to grass root level workers in the trade union movement, both in the



urban and rural areas and also to officers dealing with industrial relations,
personnel management, labour welfare etc.

Social Security

There are a variety of laws enacted and schemes established by the
Central/State Governments with a view to provide for social security and
welfare of specific categories of working people.

The principal social security laws enacted centrally are the following:

1. The Workmen's compensation Act, 1923 (WC.Act.)
2. The Employees State Insurance Act, 1948 (ESI Act)
3. The Employees' Provident Funds and Miscellaneous Provisions Act,
1953 (EPF & MP Act)
4. The Maternity Benefit Act, 1961 (MB Act)
5. The Payment of Gratuity Act, 1972 (PG Act)

The EPF and MP Act are administered exclusively by the Government of
India through the EPFO. The cash benefits under the ESI Act are
administered by the Central Government through the Employees State
Insurance corporation (ESIC), whereas medical care under the ESI Act is
being administered by the State Government and Union Territory
Administration. The Payment of Gratuity Act is administered by the Central
Government in establishments under its control, establishments having
branches in more than one State, major ports, mines, oil fields and the
Railways and by the State Governments and Union Territory
Administrations in all other cases. In mines and circus industry, the
provisions of the Maternity Benefit Act are being administered by the
Central Government through the Chief Labour Commissioner (Central) and
by the State Governments in factories, plantations and other establishments.
The provisions of the WC Act are being administered exclusively by State
Governments.

Programmes of the State Sector

Important programmes undertaken by the State Governments relate to
diversification and expansion of the vocational training programme,
improvement in the quality of training and extension of training
opportunities for women, the World Bank-assisted Vocational Training
Project, extension and modernisation of employment services, strengthening



of labour administration, rehabilitation of bonded labour, welfare of rural
and urban unorganised labour etc.

Some of the State Governments have attempted to enhance the utility of the
employment service set-up. The Government of Gujarat has attempted to
utilise the employment service set-up at the Taluka level by bringing the job
seekers and the job providers together in Bharti Melas. The Maharashtra
Government, in its programme of State-wide employment guarantee, intends
to use the employment exchanges to identify the beneficiaries. The West
Bangal Government has provided unemployment allowance to those
registered, and in the process has generated some information on the number
of unemployed persons in the State, by identifying them.

States have also introduced various social security schemes. The
Governments of Gujarat, Kerala, Karnataka and Madhya Pradesh have
insurance schemes for the landless agricultural labourers. This needs to be
extended to the entire country. Karnataka, Kerala and Tamil Nadu
demonstrated the viability and potential of the old age pension scheme.
Some form of social assistance is also given to the workers in the
unorganised sector. This could be considered by the other states.

Most of the States have strengthened their enforcement machinery to
implement various labour laws. The Assam Government has been
implementing the Minimum Wages Act very meticulously. Many States and
Union Territories have appointed competent authorities under the Equal
Remuneration Act, 1976 and have also set-up Advisory Committees under
the Act. Kerala State has introduced the 'Regulation of Employment d
Conditions of Service Act' for building and other construction workers.
There are various welfare schemes operated in some states. The Assam
Government has the Assam Tea Welfare Board to promote the welfare of
plantation workers. The State of Kerala has introduced many Welfare Fund
Acts for unorganised workers and has schemes to implement them. These
Acts relate to Handloom Workers, Agricultural Workers, Abkari Workers,
Auto Rikshaw Workers, Tailoring Workers, Kerala Etta, Kattuvalli, Thazha
workers and Beedi and Cigar Workers.



Social security measures
The concept of social security has been mentioned in the early Vedic hymn
which wishes everyone to be happy, free from ill- health, enjoy a bright
future and suffer no sorrow. The phrase social security is, therefore, a new
name for an old aspiration. Today is based on the “ideals of human dignity
and social justice”.
Social security is defined as “the security that society furnishes,
through appropriate organisation, against certain risks to which its members
are exposed”. These risks are essentially contingencies against which the
individual, who has small means, cannot protect himself. These
contingencies include employment injury, sickness, disablement, industrial
disease, maternity, old age, burial, widowhood, orphanhood and
unemployment.
Social security is also broadly defined as “the endeavour of the
community, as a whole, to render help to the utmost extent possible to any
individual during periods of physical distress inevitable on illness or injury
and during economic distress consequent on reduction or loss of earnings
due to illness, disablement, maternity, unemployment, old age or death of
working member”. Social security thus provides a self-balancing social
insurance or assistance from public funds or a combination of both.
Though social security programmes vary from country to country,
their three major characteristics are: they are established by law; they
provide some kind of cash payment to individuals to replace atleast a part of
their lost income that our due to such contingencies as unemployment,
maternity, work injury, invalidism, sickness, old age and death; the benefits
or services are provide in three major ways: social insurance, social
assistance or public services.

Social insurance:
The features of social insurance are:
• It is financed entirely by or mainly from the common monetary
contributions of workers, employers and the state.
• The state and the employers make major contribution to this fund,
while the employees pay only a nominal amount.



• When there is total or partial loss of income, these benefits, within
limits, ensure the maintenance of the beneficiary’s minimum standard
of living.
• Social insurance benefits are granted without an examination of an
individual’s need and without any means test, without affecting the
sense of self respect of the beneficiary.
• These benefits are so planned as to cover, on a compulsory basis, all
those who are sought to be covered.
• Social insurance reduces the suffering arising out of the contingencies
faced by an individual –contingencies which he cannot prevent.

Social insurance is different from commercial insurance, for the latter
is voluntary and is meant for the better paid section of the population, and its
benefits are in proportion to the premiums paid; it offers protection only
against individual risks and does not aim at providing a minimum standard
of living.

Social assistance:
Social assistance is provided as a supplement to social insurance for those
needy person who cannot get social insurance payments, and is offered after
a means test. The general revenues of the government provide the finance
for social assistance payments, which is made available as a legal right to
those workers who fulfil given conditions. Social assistance and social
insurance go side by side. Social assistance programmes cover such
programmes as unemployment assistance, old- age assistance, public
assistance and national assistance.
Social security is the combination of social assistance and social
insurance. Social insurance, however, falls midway between the two, for it is
financed by the stste as well as by the insured and their employers;whereas
social assistance is given gratis to the needy by the state or the community.

Public service:
Public service programmes constitute the third main type of social security.
They are financed directly by the government from their general revenues in
the form of cash payment and services to every member of the community
falling within the defined category. This kind of public service is currently
available in a number of countries in the form of national health service
providing medical care for every person in the country, old-age pension,



pension for invalidism, survivor’s pension to every widow or orphan, and a
family allowance to every family having a given number of children.
Although these social security programmes have different
characteristics, it is not always easy to draw a line of demarcation among
them. In many cases, two or even three programmes have common
characteristics. Apart from state there are many other agencies which
provide se4curity against contingencies. In many countries trade union have
their own sickness, old-age, unemployment schemes. Saving funds, sickness
benefits and old-age pensions have also been provided by a large number of
organisations to their employees.“ The underlying idea of social security
measures is that a citizen, who has contributed, or is likely to contribute to
his country’s welfare, should be given protection against certain hazards”.
The 1952 ILO convention on social security (minimum
standard)divided social security into nine components:

(a)Medical care: This should cover pregnancy,confinement, and its
consequences and any disease which may lead to a morbid condition. The
need for pre-natal and post-natal care, in addition to hospitalisation, was
emphasized. A morbid condition may require general practitioner care,
provision of essential pharmaceuticals and hospitalization.

(b)Sickness benefit:This should cover incapacity to work following morbid
condition resulting in loss of earnings. This calls for periodical payments
based on the convention specification. The worker need not be paid for the
first three days of suspension of earnings and the payment of benefit may be
limited to 26 weeks in a year.

(c) Unemployment benefit:This should cover the loss of earning during a
worker’s unemployment period. When he is capable and available for work
but remains unemployed because of lack of suitable employment. This
benefit may be limited to 13 weeks payment in a year, excluding the first
seven days of the waiting period.

(d)Old-age benefit: This benefit provides for the payment-the quantum
depending upon an individual’s working capacity during the period before
retirement.-of a certain amount beyond a prescribed age and continues till
death.



(e)Employment injury benefit: This should cover the following
contingencies resulting from accident or disease during employment:
• Morbid condition
• Inability to work following a morbid condition, leading to suspension
of earning;
• Total o0r partial loss of earning capacity which may become
permanent;
• Death of the breadwinner in the family, as a result of which family is
deprived of financial support. Medical care and periodical payment
corresponding to an individual’s need should be available.

(f)Family benefit: This should cover responsibility for the maintenance of
children during an entire period of contingency. Periodical payment,
provision of food, housing, clothing, holidays or domestic help in respect of
children should be provided to a needy family.

(g)Maternity benefit: This benefit should cover pregnancy, confinement
and their consequences resulting in the suspension of earnings. Provision
should be for medical care, including pre-natal confinement, post-natal care
and hospitalization if necessary. Periodical payment limited to 12 weeks
should be made during the period of suspension of earnings.
(h) Invalidism benefit: This benefit, in the form of periodical payments
should cover the needs of workers who suffer from any, disability arising out
of sickness or accident and who are unable to engage in any gainful activity.
This benefit should continue till invalidism changes into old-age, when old
age benefits would become payable.

(i) Survivor’s benefit: This should cover periodical payments to the family
following the death of its breadwinner and should continue the entire period
of contingency.
The ILO has suggested various methods of organizing, establishing
and financing various social security schemes. For the benefit of the less
developed countries, it has fixed the level of benefits fairly low, so that the
schemes may be practicable.



Social security and unorganised labour
Social security is the protection which society provides for its members,
through a series of public measures, against the economic and social distress
that otherwise would be caused by the stoppage or substantial reduction in
earnings resulting from sickness, maternity, employment injury,
unemployment, invalidity, old age and death; provision of medical care, and
the provision of subsidies for families with children (ILO, 1989). The
system of social security was started with the organised sector. However,
owing to pressures brought on the state and the society by the growing
awareness within the unorganised sector, concern is increasingly being
expressed and attention given to expanding legislative and social security
protection to the unorganised sector.
Social security schemes should be linked to economic security,
including employment, in-come, and assets. There should be a convergence
of the ways of reaching sustainability and of attaining expanded coverage.
The growing demands of the unorganised labour force and their attempts to
organise themselves can be met by a decentralised participatory social
security system. It will lead to a release of the people’s creative energies and
a rapid growth of social security for the organised sector. Extending social
security to the unorganised sector is not merely a matter of extending
existing organised sector schemes to new groups for the following reasons
(Getupig, et al, 1992).
1. Unorganised sector is not a homogenous category;
2. Identifying the employer in this sector is difficult;
3. Unlike the organised sector, where steady and regular employment is a
given fact, unorganised sector workers need employment security, income
security, and social security simultaneously; and
4. Needs of the unorganised sector workers vary from those of the organised
sector.
Welfare amenities stipulated in the Factories Act, Mines Act, Plantations
Labour Act, etc., are employment-based, in the sense that such Acts are
applicable to undertakings employing the minimum prescribed number of
workers. Outside the realm of these Acts, there are a large number of small-
scale establishments, which have no obligation, statutory or other-wise, to
provide welfare amenities to their workers. These establishments are located
in both urban and rural areas, and are engaged mostly in processing primary
products or in supplementing the existing large-scale industries in
transportation, construction, and retail trade. (Ghosh Subratesh, 1996). The



precise estimate of their employment strength and their wage, welfare and
working conditions are not known. The very nature of industry, the frequent
collusion between the employer and his workmen and place of work often
being in the backyard of the employers’ dwelling are some of the social
problems which stand in the way of bringing the real picture of labour
conditions to light. In the absence of any reliable data necessary for policy
recommendations, one could take stock of the situation only in terms of
opinions expressed by knowledgeable sources.

DEFINITION

The first National Commission on Labour (1966-69) defined
unorganised labour as those who have not been able to organise
themselves in pursuit of common objectives on account of
constraints like casual nature of employment, ignorance and
illiteracy, small and scattered size of establishments and position of
power enjoyed by employers because of the nature of industry etc.
Nearly 20 years later the National Commission on Rural Labour
(NCRL: 1987-91) visualised the same scenario and the same
contributory factors leading to the present status of unorganised
rural labour in India.

EXTENT OF UNORGANISED LABOUR

The 1991 Census has classified workers in this country into
two distinct categories as main workers and marginal workers. The
main workers are those workers who work for the major part of the
year (296 days) and marginal workers are those who work for less
that 6 months (183 days). Out of a total work force of 314 million
in India, about 286 million (i.e. about 91%) were main workers and
about 28 million (i.e.9%) were marginal workers. The data of the
Census of India also shows that the bulk of the working population
is in the unorganised sector (i.e. 91% of the total population) and
this workforce is as yet not actively unionised. The organised
sector, which is generally extant around urban settlements,
accounts for only 9% of the total work force.

CATEGORIES OF UNORGANISED LABOUR



Unorganised workers can be categorised broadly under the
following four heads, namely –

1. In terms of occupation

Small and marginal farmers, landless agricultural labourers,
share croppers, fishermen, those engaged in animal husbandry, in
beedi rolling, beedi labelling and beedi packing, building and other
construction workers, leather workers, weavers, artisans, salt
workers, workers in brick kilns and stone quarries, workers in saw
mills, oil mills etc. may come in this category.

2. In terms of nature of employment
3. Attached agricultural labourers, bonded labourers,
migrant workers, contract and casual labourers come
under this category.
4. In terms of specially distressed categories

Toddy tappers, scavengers, carriers of head loads, drivers of
animal driven vehicles, loaders and unloaders, belong to this
category.

5. In terms of service categories

Midwives, domestic workers, fishermen and women, barbers,
vegetable and fruit vendors, newspaper vendors etc. come under
this category.

Social security measures in unorganised sector in India
Social security comprises two types of measures, promotional and
protective. Promotional measures consist mainly of employment, training,
and nutrition schemes, by which persons are enabled to work and earn a
livelihood. On the other hand, protective measures consist of schemes by
which the State provides the means of livelihood when a person is not able
to work (Sankaran, T.S, 1993). ILO standards relating to social security are
mainly protective and have been designed primarily for workers in the
organised sector. Both promotional and protective measures are necessary to
provide adequate social security facilities.



Medical care
According to ILO recommendation No.69, medical care should be provided
either through a social service medical care service, with supplementary
provisions by way of social assistance, to meet the requirements of people in
need who are not covered by social insurance, or through a public medical
service (ILO, 1984). It requires that complete preventive and curative care
be available, care which is rationally organised and coordinated with general
health services. In India, medical care is provided largely by the public
medical service, by private doctors and hospitals, and to a limited extent by
social insurance schemes, welfare funds, and voluntary health associations.
Some of the Welfare Funds in Kerala have adopted the reimbursement of the
cost of medical care at standard rates or actual, whereas the Employees State
Insurance Scheme is based on providing the service directly under an
integrated arrangement in which the financing and the medical services vest
with the same organisation. On the other hand, some of the public sector
establishments provide service indirectly by entering into contract with
doctors, diagnostic centres, and hospitals.

Sickness benefit
Sickness benefit is payable when an insured person has to stop work due to
his poor health conditions, and such a stop in work usually entails reduction
or stoppage of earnings. Cash benefit is designed to replace in whole, or in
part, the lost earnings. In India, there is provision for payment of sickness
benefit under the Employees State Insurance Scheme (Government of India,
1996). Employees of Central and State governments and some public and
private sector establishments are entitled to medical leave on half-pay.

Maternity benefit
One of the earliest conventions adopted by ILO was the Maternity Protection
Convention in
1919. The purpose of this Convention was to ensure that a woman worker
would be able to sustain herself and her baby during the period immediately
before and after her confinement. Maternity benefit is usually provided
under a social insurance scheme along with medical care and sickness
benefit. In India maternity benefit is provided under the Maternity Benefit
Act (as an employers’ liability) the Employees State Insurance Act (as a part
of the health insurance scheme), the Beedi and Cigar (Conditions of
Employment) Act, Beedi and Cigar Labour Welfare Fund Act, and the
various State government schemes for social assistance. The National Social



Assistance Programme also provides for payment of maternity benefits in
lump sum.

Employment injury benefit
Employment Injury Benefit is the most widely adopted branch of social
security, and is also known as workmen’s compensation. According to ILO
Recommendation No.67 concern in income security, the contingency for
which compensation for employment injury should be paid, is traumatic
injury, or disease in the course of employment, and not injury brought about
deliberately, or by serious and willful misconduct of the victim, which
results in temporary or permanent disability or death (ILO, 1984). This is a
cash benefit but is often associated with medical care. In India, employment
injury benefit is provided under the
Workmen’s Compensation Act and the Employees State Insurance Act.
While the former
Act is applicable to some employment in the unorganised sector, such as the
construction industry, the latter Act is applicable mainly to workers in the
organised sector.

Old-age benefit
Old age, invalidity, and survivors’ benefits are the main long-term social
security benefits, which are of great importance in any social security
scheme. ILO conventions stipulate that the pensionable age should not be
more than 65 years, unless required by demographic, economic, and social
criteria, and that there should be a lower age for persons engaged in arduous
occupations. Old age pension may be at a flat rate, or be related to one’s past
earnings. The current trend appears to be toward building a multi-tiered
system consisting of a basic minimum pension and one or more earnings-
related pensions. In India old-age benefit is provided as follows (Ministry of
Labour, 1996).
(a) Government employees: Paid by respective governments on the basis of
employers’ liability.
(b) Employees’ pension scheme:
Workers covered under the Employees Provident and Miscellaneous
Provisions Act.
(c) Destitutes and persons below the poverty line:
Paid under national old age pension scheme and old age pension schemes of
State governments.
There exist no pension schemes for the self-employed, or for workers
employed on a casual, temporary or intermittent basis who are not destitute,



and who are not covered by the Employees Provident Fund and
Miscellaneous Provisions Act.

Invalidity benefit
Invalidity benefit is meant for people who have permanently lost their
capacity to earn to the extent prescribed. According to ILO
Recommendation No.67 concerning income security, the contingency in
which invalidity benefit is payable is the inability to engage in any
substantially gainful activity, because of a chronic condition due to disease
or injury, or because of the loss of a member or its proper functioning. The
relevant ILO convention specifies 15 years of contribution or employment or
10 years of insurance. But usually one requires only a few years’ insurance,
say five years, a part of which needs to be immediately preceding the
invalidity. In India, the Employees Pension Scheme introduced in 1995
provides for invalidity benefits.

Survivors’ benefit
This benefit is meant primarily for widows and children of persons covered
by Social Security Schemes who cease to have any financial support on the
death of their breadwinner. However, national legislation often recognises
claims of other dependents provided there are no primary beneficiaries. A
widespread practice is to base the survivors’ pension on the rate of the old
age pension the deceased was receiving or would have received (Sankaran,
T.S, 1993). In India, survivors’ benefit is provided under the Employees
State Insurance Act and Workman’s Compensation Act in case of death of a
person engaged in any employment covered under these Acts. This benefit is
provided under the Employees Provident Fund and Miscellaneous
Provisions Act in case of the death of a member of the scheme for any
reason. Insurance schemes of the Life Insurance Corporation and General
Insurance Corporation also provide this benefit. The National Family
Benefit Scheme extends this benefit in case of the death of the breadwinner
of a family which lies below the poverty line.

Unemployment benefit
The underlying principle of unemployment benefit is that if a person,
through no fault of his, is deprived of his income, he has a right to expect
income support, at least for the necessities of life while he remains available
for work. According to ILO recommendations No.67, the contingency in
which unemployment benefit should be paid is loss of earnings due to a state
of unemployment of an insured person who is ordinarily employed, a person



who is capable of regular employment in some occupation and is searching
for suitable employment or due to part time unemployment (Government of
India, 1995-‘96). Its main purpose is to deal with temporary unemployment
of employed persons and not the extensive and prolonged unemployment
and under-employment found in many developing countries. The payment of
the benefits depends on satisfying the qualifying clause of covered
employment, and a waiting period may also be applied.

Family benefit
ILO Recommendation No.67 says that society should co-operate with
parents, and give general assistance designed to secure the wellbeing of
children. This benefit is intended to assist families in raising their children.
Although there are no family benefit schemes in India, which provide for the
payment of cash allowances to families for the maintenance of children,
there exist many schemes which help families of Scheduled Castes/Tribes,
minorities and other weaker sections of society, in the discharge of their
responsibilities for education of their children, marriage of their daughters,
construction of houses, and meeting funeral expenses.

Strategies for social security in unorganised sector
The majority of the Social security schemes implemented in the country
were in the organised sector, keeping large numbers outside the realm of the
Social security net (Berman, 1995). A beginning has been made lately to
provide social insurance for workers in the unorganised sector, with the help
of the Central and the State governments. These schemes are administered
by government agencies, co-operatives or NGOs, and are a combination of
social assistance and social insurance.

Insurance schemes
The Life Insurance Corporation of India has developed group insurance,
which is akin to social insurance based on large numbers, and has the
potential to provide social security to persons in the unorganised industrial
and agricultural sectors. There exist now several other group insurance
schemes for the unorganised sector workers such as milk producers,
handloom weavers, rickshaw pullers, shop assistants, beedi workers, and
fish farmers. The schemes of the LIC provide mainly survivor benefits;
however, some also provide old-age pensions. The General Insurance
Corporation (GIC) of India also administers a few social security schemes
for poor families, a Hut Insurance Scheme, and a Solatium Fund. In



addition, GIC has introduced a Health Insurance Scheme, and has been
administering the comprehensive Group Insurance Scheme for the Central
Government. The schemes of the
General Insurance Corporation provide invalidity benefits, or health
insurance, or protection against loss of property.

National Social Assistance Programme
Of the various protective schemes in existence for workers in the
unorganised sector, the most important is the National Social Assistance
Programme introduced in 1955 (Wadhawan, 1989). It provides social
assistance to poor households in the case of old age, death of the
breadwinner, and maternity through the National Old Age Pension Scheme,
National Family Benefit Scheme, and the National Maternity Benefit
Scheme respectively. Under the National Old Age Pension Scheme, Central
assistance is provided to States for payment of old age pension to persons
who are of the age of 65 years or more. In addition to the National Old Age
Pension Scheme, all State governments and Union territories have their own
old-age pension schemes.

Other pension schemes
Apart from the old-age pension schemes already referred to, the States
Kerala, Tamil Nadu,
Karnataka, Andhra Pradesh, Maharashtra, and Gujarat have pension schemes
for agricultural workers. Many states have extended the old-age pension
scheme benefits to destitute widows, physically and mentally retarded
persons, freedom fighters and indigent artists; and some have also set up
homes for destitute widows and deserted /divorced women. Under the
Family Benefit scheme assistance is given to families below the poverty line
on the death of their breadwinner; under the National Maternity Benefit
scheme assistance is given to pregnant women for the first two childbirths.

Welfare Funds
Welfare funds represent one of the models tried in India for providing social
security protection to workers in the unorganised sector. There exist broadly
two types of welfare funds– contributory and tax-based. The Government of
India has set up tax-based welfare funds for mine workers, beedi rollers, cine
workers, and workers in the building industry; these funds are financed by
cess levied on the production or export of specified goods. They provide
mainly medical care, assistance for the education of children, housing and



water supply, and recreational facilities. There are nearly 20 Welfare Funds
constituted by Government of Kerala for the benefit of different target
groups such as agricultural workers, head-load workers, construction
workers, coir workers, cashew workers, motor transport workers,
autorickshaw workers, toddy workers, and artisans the majority of which are
contributory.

Existing models of social security and labour welfare
Since India has committed to the welfare of the marginalized sections of the
society the government has taken upon itself the delivery of all types of
social services and social security. This pattern is reflected in existing
models of social security delivery as may be seen from Table 2.1. There are
mainly three types of social security models: employers’ liability, social
insurance, and social assistance. The last category includes welfare funds of
Central government, welfare funds of State government, subsidised
insurance schemes, and other forms of social assistance. The beneficiaries of
the first (employers’ liability) are mainly workers in the organised sector,
whereas under social assistance the beneficiaries are both workers in the
organised sector and workers in the informal sector. The latter belong in
generally to the marginalised sectors. In the context of growing
privatizations of services on the one hand and the growing awareness and
organisation of the oppressed sections of workers on the other, it is
necessary to search for models of effective social security provision to all
the unorganised sector workers. Breadwinner and maternity through the
National Old Age Pension Scheme, National Family Benefit Scheme, and
the National Maternity Benefit Scheme respectively. Under the National Old
Age Pension Scheme, Central assistance is provided to States for payment of
old age pension to persons who are of the age of 65 years or more. In
addition to the National OldAge Pension Scheme, all State governments and
Union territories have their own old-age pension schemes.

.

Table 2.1 Existing Models of Social Security

Model Nature of Beneficiaries Administrative/
Benefit Arrangement Financial
1.Employers’ 1. Workers in the Employers
Liability Workermen’s Organized manage



comp. Sector
2.Maternity
Benefit
3.Gratuity
4.Retrenchment
comp.
2.Social (A) 1.Medical Workers in the Administered by
Insurance Care Organised Employees’
2.Sickness sector State
3.Maternity Insurance
4.Occupational Corporation
Injury financed out of
contributions
from
employers,
employees
and State
Governments
(B)1.Old-age Workers in the Administered by
benefit organized central Board of
2.Invalidity sector and Trustees,
benefit some sections financed by
3.Survivors’ of the workers contributions
benefit in organized from
4.Provident sectors. employers,
Fund employees
and central
government.



3.Social (A) 1.Medical 1. Mine Administered
(a)Welfare care workers Depart-mentally
Funds of 2.Education 2. Beedi financed by
Central 3.Housing workers special levies in
Government 4.Water Supply 3. Cine the form of
workers cesses.
4. Building
works

(B)
1.Education
2.Old-age
Benefit
3.Survivors’
Benefit
(b) Welfare 1.Old-age Workers in the Administered by
Funds of Benefit unorganised autonomous
state 2.Medical Care sector, boards
Government 3.Education such as financed by
4.Assistance handloom contributors
for workers, Coir from employers,
marriage, Workers and workers and
housing etc. Cashew others
Workers.
.
(c) 1.Survivors’ Vulnerable Administered by
Subsidized benefit groups LIC
Insurance 2. Invalidity of workers and GIC,
benefit such as financed by
agricultural contributions
workers from
and handloom central and state
workers. Governments

(d) Other 1.Old-age Persons outside Administered
Forms of benefit the Depart-mentally
Social 2.Maternity job market and financial from
Assistance benefit below the general revenues
3.Surviovrs’ poverty
benefit line, destitutes,



4. Assistance orphans,
for: deserted,
employment and divorced
training women,
education etc. widows,
disabled
persons,
SCs., STs.,
OBCs,
etc.

Social security for the unorganised workers cannot be reached by
centralizing and standardizing schemes; they can be reached by workers
themselves to take initiative (Subramanya, 1994). People remain weak and
vulnerable partly because they are unorganised and hence isolated and
powerless. The provision social security can itself be a means that would
lead the unorganised sector workers to organise and become empowered.
Security of needs like food, health care, housing and child care, is
empowering for vulnerable unorganised sector workers and helps them to
alter their bar-gaining positions in the market (Sen and Dreze,
1990).Centralised non-participatory systems tend to be disempowering,
while participatory and beneficiary-run systems lead the workers to organise
themselves.

LEGISLATIVE PROTECTION

The Government has taken various initiatives through
enactment of legislations, creation of welfare funds, spreading
workers education and through supporting non-governmental
organisations to bring this deprived class into the mainstream of
our work force. Some of the important legislations which help
unorganised workers are as under:-

 Minimum Wages Act, 1948.

 Workmen’s Compensation Act, 1923.

 Maternity Benefit Act, 1961



 The Employees State Insurance Act, 1948.

 Bonded Labour System (Abolition) Act, 1976.

 Contract Labour (Regulation & Abolition) Act, 1970.

 Inter-State Migrant Workmen (Regulation of
Employment and Conditions of Service) Act, 1979.

Indian social security system

SALIENT FEATURES OF VARIOUS ACTS FOR
WHICH THE CENTRAL INDUSTRIAL RELATION
MACHINERY IS THE ENFORCING AGENCY.

The Central Industrial Relation Machinery (CIRM) is the responsible
for enforcing the following labour Laws in the industries and
establishments for which the Central Government is the appropriate
Government.

 PAYMENT OF WAGES ACt 1936.

The Central Government is the Appropriate Government under the Act
in respect of the establishments of Railways, Mines/oil-fields, Air
Transport and major ports. Employers cannot withhold wages earned by
workers nor can they make any unauthorised deduction. Payment must be
made before expiry of a specified day after the last day of the wage
period. Fines can be imposed for only those acts or omissions, which
have been approved by an appropriate authority and must not exceed an
amount equal to three per cent of wages payable. If payment of wages is
delayed or wrongful deductions are made, workers or their trade unions
can file a claim.

 MINIMUM WAGES ACT, 1948

The Minimum Wages Act, empowers the Government to fix minimum
wages for employees working in specified employments. It provides for
review and revision of minimum wages already fixed after suitable
intervals not exceeding five years. Central Government is the appropriate
agency in relation to any scheduled employment carried on by or under
its authority or in railway administration or in relation to mines, oilfields



or major ports or any corporation established under the Central Act. State
governments are the appropriate agencies in relation to other scheduled
employment. The Central Government is concerned to a limited extent
with building and construction activities mostly carried on by Central
Public Works Department, Ministry of Defence etc, and agricultural
farms under the Ministries of Defence and Agriculture. Bulk of such
employment fall in the state spheres and state governments are required
to fix/revise wages and ensure their implementation in respect of
scheduled employment within their spheres.

Enforcement of Minimum wages in Central sphere is secured [through
the Central Industrial Relations Machinery (CIRM). The Central
Government has fixed Minimum Wages under the Minimum Wages Act,
1948 for 40 scheduled employment under the Central Sphere.

 PAYMENT OF BONUS ACT 1965 :

The Act Applies to all Factories and every other establishments, which
employs twenty or more workmen. The Payment of Bonus Act, 1965
provides for a minimum bonus of 8.33 percent of wages. The salary
limited fixed for eligibility purposes in Rs. 3,500 per month and the
payment is subject to the stipulation that the bonus payable to employees
drawing wages or salary between Rs2,500 and Rs. 3,500 per month
would be calculated as if their salary or wages is Rs. 2,500 per month.

The Central Government is the Appropriate authority in respect of the
industries /establishments for which it is appropriate Government under
the industrial Disputes Act, 1947.

 EQUAL REMUNERATION ACT 1979 :

Equal Remuneration Act 1979 Provides for payment of equal wages for
work of same and similar nature to male and female workers and for not
making discrimination against female employees in the matters of
transfers, training and promotion etc. Central Government is the
appropriate Govt. in respect of industries/establishments for which it is
appropriate Govt. under the Industrial Disputes Act. 1947.



 CONTRACT LABOUR

The Contract Labour (Regulation and Abolition) Act, 1970 has been
enacted to regulate the employment of contract labour in certain
establishments and to provide for its abolition in certain circumstances
and for matters connected therewith. It applies to all establishments
employing 20 or more contract labour and to all contractors who employs
20 or more contract labors. It applies to all establishments 20 or more
contract Labour and to all contractors who employer, 20 or more
Contract Labour. The Act provides for the constitution of Central and
State Advisory Boards to advise the concerned governments on matters
arising out of the administration of the Act.

The Central Government has issued a number of notifications prohibiting
employment of Contract Labour in different categories of works, job and
process as in mines, Food Corporation of India's godowns, port trusts and
many other industries/ establishments for which it is the Appropriate
Government. The Central Advisory Contract Labour Board has also
constituted a number of committees to enquire into the question of
prohibition of contract labour system in different establishments.

Central Government is the Appropriate Government in respect of
industries and establishments for which it is Appropriate Government
under the industrial Disputes Act,1947

 CHILD LABOUR (Prohibition and Regulation)
Act,1986.

The Child Labour (Prohibition & Regulation) Act, 1986 prohibits
employment of children in certain hazardous occupations and processes
and regulates their employment in some other areas.

Central Government is the Appropriate Government in relation to an
establishment under the Control of the Central Government or a railways
administration or a major port or a mine or oilfield. The Hon'ble Supreme
Court in their Judgement dated 10.12.1996 in the Writ Petition (Civil)
No.465/86 has given certain directions regarding the manner in which
children working in hazardous occupations are to be withdrawn and
rehabilitated. One of the important directions of the Supreme Court
relates to conduct of survey of Child Labour. The issue of conducting
survey came up for discussion in the Conference of Labour Ministers,



Labour Secretaries, Labour Commissioner of all the States/UTs which
was held in New Delhi on 22.1.1997 under the Chairmanship of the
Union Labour Minister.

After the deliberation in the conference guidelines to the State
Governments for implementing the judgement of the Hon'ble Supreme
Court have been issued by the Ministry of Labour.

 CERTIFICATION OF STANDING ORDERS:

The Industrial Employment (standing orders) Act 1946 is an Act to
require employers in industrial establishments to formally define
conditions of employment under them. It applies to every industrial
establishment wherein 100 (reduced to 50 by the Central Government in
respect of the establishments for which it is the Appropriate Government)
or more workmen are employed. And the Central Government is the
appropriate Government in respect of establishments under the control of
Central Government or a Railway Administration or in a major port,
mine or oil field. Under the Industrial Employment (Standing Orders)
Act, 1946, all RLCs(C) have been declared Certifying Officers to certify
the standing orders in respect of the establishments falling in the Central
Sphere. CLC(C), Jt. CLC(C) and all Dy.CLCs(C) have been declared
Appellate Authorities under the Act.

 HOURS OF EMPLOYMENT REGULATIONS 1961.

The Hours of Employment Regulations are applicable to all railway
servants excepting those governed by the Factories Act, Mines Act and
the Indian Merchant, Shipping Act as well as those specifically excluded.
The Hours of Employment Regulation provides for classification of
railways workers depending upon nature of duties as intensive,
continuos, essentially intermittent and excluded.

It regulates hours of work and periods of rest. workers aggrieved by
classification can approach RLCs who is empowered to decide such
cases.

 MATERNITY BENEFIT ACT , 1961

The Maternity Benefit Act, 1961 regulates employment of women in
certain establishments for a certain period before and after child birth and



provides for maternity and other benefits. The Act applies to mines,
factories, circus, industry, plantation and shops and establishments
employing ten or more persons, except employees covered under the
Employees State Insurance act, 1948. It can be extended to other
establishments by the state governments. There is no wage limit for
coverage under the Act. The Central Government is Appropriate
Government in respect of the Circus Industry and Mines

 GRATUITY ACT, 1972

The Payment of Gratuity Act, 1972 is applicable, to factories, mines, oil
fields, plantations, ports, railways, motor transport undertakings,
companies, and to shops and other establishments, Employing 10 or more
workmen. The Act provides for payment of gratuity at the rate of 15 days
wages for each completed year of service subject to a maximum of Rs.
two lakh. In the case of seasonal establishment, gratuity is payable at the
rate of seven days wages for each season. The Act does not affect the
right of an employee to receive better terms of gratuity under any award
or agreement or contract with the employer. Central Government is the
Appropriate Government in relation to an establishment belonging to the
or under the control of the Central Government or having branches in
more than states or an establishment of a factory belonging to or under
the control of Central Government or of a major port, oilfield railway or
mine.

 INDUSTRIAL DISPUTE ACT. 1947

The Industrial Disputes Act. 1947 is an act to make provision for
the investigation and settlement of industrial disputes and for
certain other purposes. It provides for a special machinery of
conciliation officers, work committees, court of inquiry, Labour
courts, Industrial Tribunals and national Tribunals, defining their
powers, functions and duties and also the procedure to be
followed by them.

It also enumerates the contingencies when a strike or lock-out
can be lawfully resorted to, when they can be declared illegal or



unlawful, conditions for laying off, retrenching discharging or
dismissing a workman, circumstances under which an industrial
can be closed down and several other matters related to industrial
employees and employers.

The central government is appropriate government for the
industries which are carried on:

(a) By or under the authority of Central Govt.

(b) By a railway company:

(c) A controlled industry, specified for this purpose :

(d) In relation to certain industries enumerated in sec 2(a) of the act

Employees State Insurance Scheme: This scheme offers both direct
and indirect medical care. The direct method is called the “service
system” by which the ESI corporation provides medical care, either
through its own Employee’s State Insurance hospital or through
reservation of beds in State Government hospital. The indirect method
is known as the “Panel system”, under which medical care is provided
through private doctors selected by the State government with the
approval of the ESI Corporation.

The benefits provided under the act are:
• Sickness benefit
• Maternity benefit
• Disablement benefit
• Dependents benefit
• Funeral benefit and
• Medical benefit

All the workers, earning less than 3000 per month and employed
in power run factories employing 20 or more persons are covered by this
scheme. However, it does not cover workers employed by seasonal
factories. An insured person under ESI Scheme is not eligible for similar
benefits under the Workmen’s Compensation Act and State Acts relating
to Maternity benefits



 Employees Provident Fund Act, 1952:

The act applies to, mines other than coal mines and commercial
establishment employing more than 20 workers. All the workers earning
not exceeding Rs 3,500 are covered under this Act. All accumulations of
the Provident Fund are invested in Central and State Government
securities and other government approved securities. Interest on these
securities accrues to the worker’s account. The Provident Fund Act ,1952
was amended following with the Employee’s Family Pension Scheme
has been enforced from March 1,1971, with a view to protecting the
family of the workers after his death.

 Plantation Labour Act, 1951.

Every tea, coffee, rubber and cinchona plantation, measuring 10,117
hectares or more and employing atleast 30 workers, is covered by this
act, which has since been extended to the cardamom plantation in Tamil
Nadu and Kerala. The Act lays great emphasis on the medical care of the
workers and their families. According to the rule prescribed by the State
Government, workers covered under this act are eligible for cash benefit
in sickness and maternity.

 Employer’s Family Pension Scheme, 1971:
This scheme was notified by the government of India under the
Employee’s Provident Fund and Family Pension Act. Here, family
pension means a regular monthly amount payable to the person belonging
to the family of the member of the Pension Fund Scheme. In the event of
his death during the period of reckonable service. The definition of the
word, Family covers wife or husband, minor son and unmarried daughter
of the member of the Family Pension Fund. .



List Of Acts

Apprentices Act
Child Labour (Prohibition and Regulation) Act
Contract Labour (Regulation & Abolition) Act
Dangerous Machines (Regulation) Act
Employee State Insurance Act
Employee's Provident Fund and Miscellaneous Provisions Act
Employers Liability Act
Employment Exchanges (Compulsory Notification of Vacancies) Act
Equal Remuneration Act
Factories Act
Fatal Accidents Act
Industrial Disputes (Banking and Insurance Companies) Act
Industrial Disputes Act
Industrial Employment and Standing Orders Act
Labour Laws (Exemption from Furnishing Returns and Maintaining
Registers by Certain Establishments) Act
Maternity Benefit Act
Mines Act
Minimum Wages Act
Motor Transport Workers Act
Payment of Bonus Act



Payment of Gratuity Act
Payment of Wages Act
Plantations Labour Act
The Sales Promotion Employees (Conditions Of Service) Act
The Weekly Holidays Act
Trade Unions Act
Working Journalists (Fixation of Rates of Wages) Act
Working Journalists and Other Newspaper Employees (Conditions of
Service) and Miscellaneous Provisions Act
Workmens Compensation Act
Apprenticeship Rules
Dangerous Machines (Regulation) Rules
Employee State Insurance (Central) Rules
Employee State Insurance (General Provident Fund) Rules
Employee State Insurance (General) Regulations
Employees Deposit Linked Insurance Scheme
Employees Pension Scheme
Employees Provident Fund Scheme
Employment Exchanges Rules
Equal Remuneration Rules
Payment of Bonus Rules
Sales Promotion Employees (Conditions of Service) Act
Working Journalists (Conditions of Service) and Miscellaneous Provisions
Rules
Child Labour (Prohibition and Regulation) Rules
Contract Labour (Regulation & Abolition) Central Rules
Contract Labour (Regulation and Abolition) Central Rules - Construction
and Maintenance of Creches
Industrial Employment (Standing Orders) Central Rules
Minimum Wages (Central) Rules
Payment of Gratuity (Central) Rules
The Industrial Disputes (Central) Rules
Workmen's Compensation Rules

Act-wise outline of welfare facilities
A brief outline of various welfare facilities provided under different labour
enactments is given below:
The Factories Act, 1948


A project report on labour welfare

A project report on labour welfare

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