Annexure 1
Specifics on reforms:
Current Position
Proposed Position
Efforts / Outcomes
1
Universal Account Number (UAN) by
EPFO was a vexed issue as both
employers and employees suffered while
on work or joining new establishment after
separation from the past employer.
The idea is to list multiple Member
Identification Numbers (Member Id)
allotted to a single member under single
Universal Account Number. This will help
the member to view details of all the
Member Identification Numbers (Member
Id) and further enable to check the
eligibility for online transfer claim through
the options ‘List Previous Member ID’ and
‘View Status’ from the Menu ‘Previous
Member ID’. In future there is no need to
list the member ids as it will be linked
automatically on the basis of Form-11
information. Member needs to disclose
his/her UAN/Previous Member ID to the
new employer through Form-11.
On 21st July 2014, Employees’ Provident
Fund Organisation published the Circular
for introduction of Universal Account
Number (UAN) to all existing members of
the Provident Fund under the Employees’
Provident Fund & Misc. Provisions Act,
1952.
UAN stands allocated to all 4.17 crore
(41.7 million) members who have made
contribution to EPFO in any one of the last
six months
Introduction of Universal Account Number
will help thousands and Lakhs of
subscriber to check their PF balance at
their convenience and report any
discrepancies to the employer. Failure to
act by the employer to rectify the error will
immediately refer the same to the RPFC
concerned for requisite action.
Furthermore, UAN will act as a deterrent
in PF withdrawal for short time
employment thus would ensure
considerable corpus in the PF & Pension
Fund, which the Pension Fund has been
suffering a huge deficit, thus build-up
sufficient balance at all time to meet the
requirement of Pension Benefits. Also
restricting of Withdrawal will benefit
employees in having a sizeable
accumulation in his account for supporting
him during the period of disablement, jobless situation and to families post death of
the member
2
Unified Portal for Registration of Units
for Labour Identification Number (LIN).
As a measure to secure an assurance of
compliance under 44 labour laws in India,
which applies to different industries, the
Ministry of Labour, Government of India
has introduced LIN which is unique in
nature and designed to facilitate the
employers to save considerable time,
labour and money through this transparent
and simplified system by filing returns
online. It is expected that LIN will be highly
welcomed and greeted by the Industries.
Necessary Guidance to implement LIN
has been kick-started by the Ministry
through mail alert to each employer
available with the Ministry. The Central
Labour Offices have started receiving
email alert message from the Ministry
invoking employers for an immediate
adaptation of the e-filing of returns by
registering the establishment through the
designated portal referred in the mail itself.
The objective of Web Portal is to
consolidate information of Labour
Inspection and its enforcement. It will lead
to transparency and accountability in
inspections. The compliances would be
reportable in Single Harmonized Form
which will make it simple and easy for
those filing such forms. The performance
will be monitored using key indicators thus
making the evaluation process objective.
The ministry has already collated
information of about 6-7 lakh units under
these organizations. This Portal will
facilitate ease of reporting at one place for
various Labour Laws, consolidated
information of Labour Inspection and its
enforcement. The Web Portal is aiming to
augment handiness of reporting, lucidity in
Labour Inspection and keeping an eye on
of Labour Inspection based on key
performance indices and an effective
Grievances Redressal System hyperlinked
with Department of Administrative
Reforms and Public Grievances (DARPG)
Portal.
The Web Portal will also have an Effective
Grievance Redressal System. It will
promote the use of a common Labour
Identification Number (LIN) by all
Implementing agencies.
The LIN and e-filing of Return is a result of
numerous complaints and suggestions
received by the Ministry from employers
across Industry on harassment by
enforcement officers from Central Labour
Commissioner’s Office, which in fact has
been a major failure in implementing and
enforcing the provisions of Labour Laws,
as most of the inspectors were highly
corrupt. It is a step to relieve the
employers from the menace of “Inspector
Raj” which was prevalent in Industry for
few decades.
3
Employer’s liability reduced to annual
filing of One Single Return instead of
multiple returns with different
periodicity for 16 Act
Under the proposed reforms, labour
inspectors will lose their power to decide
which unit to visit and the number of forms
related to compliance with labour laws that
As an initiative on pilot basis, the Ministry
has selected the Chief Labour
Commissioner (Central) organization, the
Employees State Insurance Corporation
(ESIC), Employees Provident Fund
Organisation (EPFO) and Directorate
General of Mines Safety (DGMS) covering
16 Labour Laws.
State Governments would join this Unified
Single Web Portal subsequently. This
integrated portal will operate through
common Unique Labour Identification
Number (Shram Pehchan Sankhya) for
each Establishment.
As part of the new system, a unique
Labour Identification Number (LIN) will be
allotted to factories or industrial units to
facilitate online registration. Instead of 16
separate returns, units need to file just
one consolidated, self-certified and
simplified online return.
With the advent of this system, it is
expected that the life of employer, in terms
of observing compliance under 16 Acts,
will be easier to have them available with
sufficient valuable time to invest in
developing their business which in turn will
accelerate the substantial growth in
economic health of the country. Besides,
Current Position
Proposed Position
Efforts / Outcomes
employers have to file will drop from 16 to
1.
Inspectors will lose their power to choose
which unit to visit. Instead, a computergenerated random list of units will be given
to inspectors, that too only the previous
day. The need to inspect a factory
because of a specific complaint will be
decided centrally after examining
evidence.
the objective of the legislation to enforce
compliances of the provision of the law by
employers, it is expected to serve
considerable savings.
In previous occasion, the periodicity of
filling returns under Acts such Contract
Labour (R&A), 1970, ESI Act,1948,
Minimum Wages Act, 1948, EPF&MP Act,
1952, Payment of Wages Act, 1936,
Maternity Benefits Act, 1961, BOCW Act,
1986, Payment of Bonus Act. 1965, InterState Migrant Workmen Act, 1979,
Employment Exchange Compulsory
Notification of Vacancies Act, 1959,
Factories Act, 1948 etc were having
different periodicity of return with different
stipulated time frame for Returns, which
often led to unintentional miss out by the
employer which landed them in trouble.
Further, the labour inspectors have to
upload their reports within 72 hours of the
inspection to ensure timely redress of
grievances of employers. The eventual
aim of the exercise is to have a complete
database on employers, employees and
industrial units on one website.
4
Industrial Disputes Act, 1947
Proviso to Section 2(s) definition of
workman
Existing definition of workmen sounds
manufacturing units where workers are
engaged which needs amendment for its
wide spread applicability. Clause VI in
Section 2(s) of definitions should be
amended so that it is in line with other
labour enactments like ESI Act 1948,
Bonus Act 1965, EPF&MP Act 1952 and
EC Act, 1923 etc.
The issue is yet to be mooted in the
Parliament for securing views of the
concerning parties for amending the
provision, so as to ensure coverage of the
ID Act, 1947 is extended to all classes of
employees
5
Notice of Change (Sec.9A)- ID Act,
1947
Chapter-IIA of the Act requires an
employer to serve notice upon the
workman, who is likely to be affected due
to any changes in the conditions of service
and within 21 days of giving such notice
any steps to change the terms of
employment will not be valid except to the
situation where the change is effected in
pursuance of any settlement or award or
the employee is in any emergency
services of the Government, no notice of
changes is required. The provision is a
part of Fourth Schedule of the ID Act,
1947.
This period of notice should be reduced to
seven (7) days from the existing provision
of twenty-one (21) days considering the
changed nature of market demand where
immediate migration of manpower needs
to be customized upon the industry
requirement and twenty-one days notice is
too long for triggering transfer order of an
employee. So either the Government
should think of reducing to 7 days for the
growth of the industry.
Section 9B of the Act empowers the State
(appropriate) Government to grant
relaxations from the provisions of Sec 9A.
6
Special Provisions relating to Lay-off,
Retrenchment and Closure (Chapter VB) – ID Act, 1947
The number filter of 300 was the limit
prescribed originally when chapter V-B
was added in the ID Act in 1976. It was
reduced to 100 through an amendment in
1982.
With the large proportion and presence of
outsourced employees indirectly engaged
in Industries which runs thousand in
numbers in minimum scale in various
establishment and un-timely termination
before the expiry of the -fixed term
employment sometimes gets necessitates
owing to closure of contractual work due
fall of demand or monetary set-back by
the employer or for any reasons beyond
the control of the employer, any action in
this regard is badly affected for this
provision of 100 workmen bar where the
mass retrenchment happens.
This number of 100 workmen should be
increased to 1000. In fact the Second
National Labour Commission 2002 has
also recommended this number be
increased to 300, which is too less. An
increase in this number would lead to
higher investment, which would in turn
result in increased employment
opportunities. Simultaneously, it will also
attract foreign companies to invest more in
India.
7
The Contract Labour (Regulation &
Abolition) Act, 1970
Under Section 12, the Contractor should
be allowed to file a single Application for
As the PE is allowed to obtain Central
Registration / Consolidated Registration,
In addition to that Items No. 10 and 11 of
the fourth schedule in regards to
conditions of service for change of which
Notice is to be given on the ground of
introduction of new rules of discipline, or
alteration of existing rules, except in so far
as they are provided in standing orders or
rationalization, standardization or
improvement of plant or technique which
is likely to lead to retrenchment of
workmen should be amended or omitted in
full, keeping in view of the changing
industrial scenario as it will be in the larger
interests of the workmen to ensure
competitiveness of the unit in which they
are working.
Current Position
Composite / Consolidated Licensing to
Contractors having more than one place of
work under the same principal employer –
Sec.12
Proposed Position
Efforts / Outcomes
License for obtaining a “Single” Labour
License for all its employees scattered
across locations in India under different
labour office jurisdiction. Existing practice
of obtaining separate Labour License from
the respective separate jurisdictional ambit
of the Asst. Labour Commissioner
(Central) placed in different Zones and
Areas under the Dy Chief Labour
Commissioner (Central).
the same opportunity to be allowed to
Contractor also having Pan India
deployment under the same PE
8
The Contract Labour (Reg. & Abo)
Central Rules, 1971 : Rule 80(1) of the
Contract Labour Central/state Rules requires the contractor /Principal Employer
to maintain all records in hard copy and
within a particular distance
The barrier of 3 kms is no more a logical
provision particularly where the
contractual workers are engaged in any
establishment of the principal employer
but the Contractor is not having any
offices in that area or even in the State
itself. Hence, the provision is outdated and
adherence to compliance is not possible in
such cases.
Rule 80(1) of the Contract Labour (Reg. &
Abo) Central Rules, 1971 should be
amended to say ‘All registers and other
records required to be maintained under
the Act and rules, shall be maintained
complete and up-to-date in either physical
or any electronic format by the Contractor’.
The existing provision for 3 kms radius
should be deleted and the Contractor
should have an implied permission to
generate records mechanically and
maintain at the office of its own which is
situated at the closest vicinity of the
establishment where the manpower is
deployed.
9
Minimum Wages Act, 1948 – Section 3:
Fixing of minimum rates of wages
Multiplicity of employment in Part I and
Part II of the Schedule and notification
minimum wages in respect of all such
individual employment under both Part I &
II of the Schedule has created a lot of
confusion among employers specially
Multi National Companies, which are
mostly dependant on the guidelines and
instructions from their foreign counter part
for following the compliance parameters in
Indian Law. Enforcement Authority often
penalize both domestic and international
companies for non-adherence of minimum
wages applicable to a particular
employment of the Schedule which the
employers found in breach of adherence
the correct minimum wages for lack of
clarification in the Notification and the
legislation purely at no intentional fault or
deviation at their part.
Hence it is proposed to fix a Single Wages
as National Minimum Wages for all such
employment listed in Part I and Part II of
the Schedule of the Act considering all
ingredients of costs as well as cost of
living indexes for all locations across India
for enabling employers to follow the same.
This effort will surely boost foreign
investment in our country as more MNC
would be intended to expand their
business plan as well as new Companies
may like to choose India as their preferred
destination for business for simplified and
transparent labour laws.
The appropriate Government has been
empowered u/s 3(1) of the Act to fix the
minimum rates of wages payable to
employees employed in an employment
specified in Part I and Part II of the
Schedule and in an employment added to
either Part by notification under Section 27
through Official Gazette