Unit3: WAGE AND HOUR LAWS APPLICABLE TO HOTEL EMPLOYEES

Unit3: WAGE AND HOUR LAWS APPLICABLE TO HOTEL EMPLOYEES

Objective:

1.      To understand the law applicable to the employees in the hotel

2.      Aims of these laws

3.      Why we need to understand these laws

4.      What are the underlined benefits of these law

THE MINIMUM WAGES ACT, 1948

I OBJECT: For fixing minimum rates of wages in certain employments.

II APPLICABILITY: It extends to the whole of India and applies to scheduled employments in respect of which minimum rates of wages have been fixed under this act.

III SCHEDULED EMPLOYMENTS: An employment specified in the schedule, or any process or branch of work forming part of such employment (Section-2g)

IV FIXING OF MINIMUM RATES OF WAGES:

i. The appropriate government shall fix the minimum rates wages payable to employees employed in a scheduled employment.

ii. Review at such intervals not exceeding five years, the minimum rates of wages so fixed and revise the minimum rates if necessary. The minimum rates of wages may be fixed as a minimum time rate or a minimum piece rate or as a guaranteed time rate (Section-3).

V PAYMENT OF MINIMUM RATES OF WAGES: The employer shall pay to every employee in a scheduled employment under him wages at the rate not less than the minimum rates of wages fixed under the Act. (Section-12)

VI HOURS OF WORK, OVERTIME ETC

The Act also provides for regulation or working hours, overtime, weekly holidays and overtime wages. Period and payment of wages, and deductions from wages are also regulated. (Section—13 to 17)

VII CLAIMS UNDER THE ACT (Section-20) this section makes provisions to appoint authorities to hear and decide all claims arising out of payment less than the minimum rates of wages or any other monetary payments due under the Act. The presiding officers of the Labour court and Deputy Labour Commissioners are the authorities appointed.

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VIII WHO CAN FILE A CLAIM PETITION

i. The Employee or

ii. Any legal practitioner or any official of a regd. Trade union authorised in writing to act on his behalf or

iii. Any Inspector or

iv. Any person acting with the permission of the authority under Section-20 (I)

IX REGISTERS AND RECORDS

Every employer shall maintain the following registers and records as required under the Kerala Minimum Wages Rules 1958 enacted vide section-30 of the Act.

i. Register of wages in Form No. XI or Form XII

ii. A muster-roll in Form No. VI

iii. Register of fines, Form No. I

iv. Register of deductions for damage or loss in Form No. II

v. Register of overtime in Form No. V

vi. Visit book

vii. A wage slip in Form No. XIII shall be issued by every employer to every person employed by him at least a day prior to the disbursement of wages.

X. NOTICE TO BE EXHIBITED: A notice in Form IV containing the minimum rates of wages fixed together with the abstract of the Act, the rates made there under and the name and address of the inspector shall be displayed in English and in a language understood by the majority of the workers.

XI. ANNUAL RETURNS: Annual returns in Form III or Form III a as per rule 21 (4) (iii)

shall be submitted to the Inspector before the first day of the February of the succeeding

year.

XII. PRESERVATION OF REGISTERS: All the registers shall be preserved for a period of

three years after the date of last entry made within.

XIII. PENTALITY: Any employer who contravenes (violates) any of the provisions of this Act other than those relating to Section 12 and 13 of any rule or any order made there under shall be punishable with fine, which may extend to Rs.500. Any employer who contravenes the provision relating to the payment of minimum rates of wages fixed (Section- 12) hours of work stipulated for constituting a normal working day as per section 13 shall be punishable with imprisonment for a term which may extend to six months or with fine which may extend to Rs. 500/- or with both.

XIV. AUTHORITIES APPOINTED UNDER THE ACT:

1. Inspector: (Under Section-19)

a. Labour Commissioner

b. Additional Labour Commissioner (IR and E)

c. Regional Joint Labour Commissioners

d. Joint Labour Commissioner (P)

e. Chief Inspector of Plantations

f. Deputy Labour Commissioner (HQ)

g. Dist Labour Officer (HQ)

h. Additional Labour Commissioner, Kozhikode

i. Dist Labour Officers (E)

j. Inspector of plantations

k. Asst. Labour Officers – Grade II

2. Claim Authorities (under Section –20)

a. Labour Courts

b. Deputy Labour Commissioners

3. Sanctioning Authority under Sec. 22

a. Labour Courts

b. The chief inspector of plantations c. Dist. Labour officers

Note: book for reference, legal Aspects for hospitality & travel –tourism industry by Dr.Atul Bansal

THE INDUSTRIAL DISPUTES ACT, 1947

The objective of the Industrial Disputes Act is to secure industrial peace and harmony by providing machinery and procedure for the investigation and settlement of industrial disputes by negotiations.

The Industrial Disputes Act (IDA) of 1947states that firms employing 300 or more workers required to obtain government permission for layoffs, retrenchments and closures. A further amendment in 1982 (which took effect in 1984) expanded its ambit by reducing the number to 100 workers. Job security laws thus protect a workers in the organized sector and prevent the expansion of industrial employment that could benefit the mass of workers outside.

 According to Sec 2 of Industrial Disputes Act 1947, Industrial dispute means any dispute or difference between employers & employers or between employers and workmen or between workmen and workmen, which is connected with the employment or non-employment or terms of employment or with the conditions of labour of any person.ID Act also lay down

1. The provision for payment of compensation to the workman on account of closure or lay off or retrenchment.
2. The procedure for prior permission of appropriate Government for laying off or retrenching the workers or closing down industrial establishments
3. Unfair labour practices on part of an employer or a trade union or workers

Types of Industrial Disputes

There are two types of Industrial Disputes-interest disputes and rights disputes.

 Interest disputes relate to determination of new wage level and other condition of employment.

While rights disputes on the other hand relate to interpretation and application of existing standards and usually involve and individual worker or group of workers.

Under category of rights disputes, claim is made that the workmen have not been treated:

·        In accordance with the rules, individual contracts of employment, laws and regulations and as per collective agreements.

·        Such disputes are also described as grievance disputes. Such grievances may be regarding retrenchment ,dismissal, payment of wages, working time, overtime, demotion , promotion, transfer, seniority, job classification, work rules and fulfillment of obligation relating to safety and health laid down in an agreement.

The definition of Industrial Dispute as given in the Act has a wide coverage. All disputes relating to employment or non- employment, or the terms of employment or with the condition of labour are covered under the definition.

It defines Workman to be a person employed in an industry to do skilled or unskilled, manual, supervisory, technical, operational or clerical work.

Applicability

The Industrial Disputes Act extends to whole of India and applies to every industrial establishment carrying on any business, trade, manufacture or distribution of goods and services irrespective of the number of workmen employed therein.

 Every person employed in an establishment for hire or reward including contract labour, apprentices and part time employees to do any manual, clerical, skilled, unskilled, technical, operational or supervisory work, is covered by the Act.

This Act though does not apply to persons mainly in managerial or administrative capacity, persons engaged in a supervisory capacity and drawing > 1600 per month or executing managerial functions and persons subject to Army Act, Air Force and Navy Act or those in police service or officer or employee of a prison.

Settlement Authorities under this act

Settlement means a settlement arrived at in the course of conciliation proceeding and included a written agreement between employer and workmen arrived at otherwise than in course conciliation proceeding where such agreement has been signed by the parties there to in such manner as may be prescribed and a copy thereof has been sent to the officer authorized in this behalf by the appropriate government and the conciliation officer.

  

·        Works Committee 

·        Conciliation officers 

·        Boards of Conciliation 

·        Courts of Inquiry 

·        Labour Courts 

·        7A. Tribunals 

·        7B. National Tribunals 

·        7C. Disqualifications for the presiding officers of Labour Courts, Tribunals and National Tribunals 

·        Filling of vacancies 

·        Finality of orders constituting Boards, etc

Procedures for settling labour dispute: Collective Bargaining, Negotiation, Conciliation and Mediation, Arbitration and Adjudication are well known methods for settlement of industrial disputes.

Collective Bargaining: - Collective Bargaining is a technique by which dispute as to conditions of employment, are resolved amicably, by agreement, rather than by coercion. The dispute is settled peacefully and voluntarily between labour and management.

 Negotiation: Negotiation is one of the principal means of settling labour disputes. However, due to lack of trust between the employers and workmen or their trade unions or inter-rivalry of the trade unions and the employers being in a commanding position, many a time negotiations fail.

Conciliation & Mediation: Through conciliation and mediation a third party provides assistance with a view to help the parties to reach an agreement. The conciliator brings the rival parties together discuss with them their differences and assist them in finding out solution to their problems. Mediator on the other hand is more actively involved while assisting the parties to find an amicable settlement. Sometimes he submits his own proposals for settlement of their disputes.

Conciliation may be voluntary or compulsory. It is voluntary if the parties are free to make use of the same, while it is compulsory when the parties have to participate irrespective of whether they desire to do so or not. Section 4 of the Act provides for appointment for conciliation officers and Section 5 for constitution of Boards of Conciliation. The Board of conciliation is to consist of an independent Chairman and two or four member representing the parties in equal number. While the former is charged with the duty of mediating in and promoting the settlement of industrial disputes, the latter is required to promote the settlement of industrial disputes. The act generally allows registered trade unions or a substantial number of workers/ employees and also in certain cases individual workman to raise disputes.

Arbitration: The resort to arbitration procedure may be compulsory or arbitrary. Compulsory arbitration is the submission of disputes to arbitration without consent or agreement of the parties involved in the dispute and the award given by the arbitrator being binding on the parties to the dispute. On the other hand in case of voluntary arbitration, the dispute can be referred for arbitration only if the parties agree to the same.

Industrial disputes are symptoms of industrial unrest. Industrial unrest may take either unorganized or organized from. When it is unorganized it is manifested inform of low morale, low productivity, frustration etc. organized from of industrial unrest includes strikes, demonstration, boycotts etc.

UNFAIR LABOUR PRACTICES

Prohibition of unfair labour practice:

Prohibition of unfair labour practice: No employer or workman or a trade union, whether registered under the Trade4 Unions Act, 1926 or not, shall commit any unfair labour practice.

PENALTIES

Penalty for illegal strikes and lock-outs.

 Penalty for illegal strikes and lock-outs:

(1) Any workman who commences, continues or otherwise acts in  furtherance of, a strike which is illegal under this Act, shall be punishable with imprisonment for a term which may extend to one month, or with fine which may extend to fifty rupees, or with both.

(2) Any employer who commences, continues, or otherwise acts in furtherance of a lock-out which is illegal under this Act, shall be punishable with imprisonment for a term which may extend to one month,

or with fine which may extend to one thousand rupees, or with both.

Penalty for instigation, etc.

Any person who instigates or incites others to take part in, or otherwise acts in furtherance of, a strike or lock-out which is illegal under this Act, shall be punishable with imprisonment for a term which may extend to six

months, or with fine which may extend to one thousand rupees, or with both.

Penalty for giving financial aid to illegal strikes and lock-outs.

Penalty for giving financial aid to illegal strikes andlock-outs.- Any person who knowingly expends or applies any money indirect furtherance or support of any illegal strike or lock-out shall be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or withboth.

Penalty for breach of settlement or award:

Any person who commits a breach of any term of any settlement or award, which is binding on him under this Act, shall be punishable with imprisonment for a term which may extend to six months, or with fine, or with both, and where the breach is a continuing one, with a further fine which may extend to two hundred rupees for every day during which the breach continues after the conviction for the first and the Court trying the offence, if it fines the offender, may direct that the whole or any part of the fine realized from him shall be paid, by way of compensation, to any person who, in its opinion, has been injured by

such breach

Questions:

1. What is meant by the word “Industrial Dispute” under Industrial Dispute Act 1947?

The definition of Industrial Dispute as given in the Act has a wide coverage. All disputes relating to employment or non- employment, or the terms of employment or with the condition of labour are covered under the definition.

2. What are the different categories of Industrial Disputes?

The Second Schedule of the I.D. Act deals with matters within the jurisdiction of Labour Courts, which fall under the category of Rights Disputes. Such disputes are as follows:

1. The propriety or legality of an order passed by an employer under the standing orders;

2. The application and interpretation of standing orders, which regulate conditions of employment.

3. Discharge or dismissal of workmen including reinstatement of, or grant of relief to, workmen wrongfully dismissed;

4. Withdrawal of any customary concession or privilege;

5. Illegality or otherwise of a strike or lock-out; and

6. All matters other than those specified in the Third Schedule.

The Third Schedule of the I.D. Act deals with matters within the jurisdiction of Industrial Tribunals which could be classified as Interest Disputes. These are as follows: -

1. Wages, including the period and mode of payment;

2. Compensatory and other allowances;

3. Hours of work and rest intervals;

4. Leave with wages and holidays;

5. Bonus, profit sharing, provident fund and gratuity;

6. Shift working otherwise than in accordance with standing orders;

7. Classification by grades;

8. Rules of discipline;

9. Rationalization;

10. Retrenchment of workmen and closure of establishment; and

11. Any other matter that may be prescribed

3. Who can raise an Industrial Dispute?

Any person who is a workman employed in an industry can raise an industrial dispute. A workman includes any person (including an apprentice) employed in an industry to do manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward. It excludes those employed in the Army, Navy, Air Force and in the police service, in managerial or administrative capacity. Industry means any business, trade, undertaking, manufacture or calling of employers and includes any calling, service, employment, handicraft, or industrial occupation or avocation of workmen.

4. How to raise an Industrial Dispute?

A workman can raise a dispute directly before a Conciliation Officer in the case of discharge, dismissal, retrenchment or any form of termination of service. In all other cases listed at 2 above, the dispute has to be raised by a Union / Management.

5. Who are Conciliation Officers and what do they do?

The Organization of the Chief Labour Commissioner (Central) acts as the primary conciliatory agency in the Central Government for industrial disputes. There are the Regional Labour Commissioners (Central) and Assistant Labour Commissioners (Central) who on behalf of the Chief Labour Commissioner (Central) act as Conciliatory Officers in different parts of the country.

The Conciliation Officer makes efforts to resolve the dispute through settlement between the workmen and the management. The duties of Conciliation Officers have been laid down under Section 12 of the Industrial Disputes Act.

6. What happens if conciliation fails?

In case of failure of conciliation (FOC) a report is sent to Government (IR Desks in Ministry of Labour). The Ministry of Labour after considering the FOC Report exercises the powers available to it under Section 10 of the Industrial Disputes Act and either refers the dispute for adjudication or refuses to do so. Details of functions of IR Desks and reasons for declining may be seen above.

There are at present 17 Central Government Industrial Tribunals-cum-Labour Courts in different parts of the country to whom industrial disputes could be referred for adjudication. These CGITs -cum-Labour Courts are at New Delhi, Mumbai (2 CGITs), Bangalore, Kolkata, etc. have been declared as National Industrial Tribunals.

7. What happens when the dispute is referred to Labour Court?

After the matter is referred to any of the CGIT-cum-Labour Court, the settlement process begins. At the end of the proceedings an Award is given by the Presiding Officer.

The Ministry of Labour under Section 17 of the I.D. Act publishes the Award in the Official Gazette within a period of 30 days from the date of receipt of the Award.

8. How is the Award implemented?

An Award becomes enforceable on the expiry of 30 days from the date of its publication in the Official Gazette. The Regional Labour Commissioner is the implementing authority of the Awards.

9. What are the provisions for General Prohibition of Strikes and Lockouts?

No workman who is employed in any industrial establishment shall go on strike in breach of contract and no employer of any such workman shall declare a lockout:

(a) During the pendency of conciliation proceedings before a Board and seven days after the conclusion of such proceedings,

(b) During the pendency of such proceedings before a Labour Court, Tribunal or National Tribunal and 2 months after the conclusion of such proceedings.

(c) During the pendency of arbitration proceedings before an Arbitrator and 2 months after the conclusion of such proceedings, where a notification has been issued.

(d) During any period in which a settlement or Award is in operation in respect of any of the matters covered by the settlement of Award.

10. Does the workman have the Right to go on strike with proper notice in Public Utility Services?

No person employed in a Public Utility Service can go on strike without giving to the employer notice of strike;

(a) Within 6 weeks before striking.

(b) Within 14 days of giving such notice.

(c) Before the expiry of the date of strike specified in such notice.

(d) During the pendency of any conciliation proceedings before a Conciliation Officer and 7 days after the conclusion of such proceedings.

11. Does the Employer have the right to lock out any Public Utility Service?

No employer carrying on any Public Utility service can lockout any of his workman:

(i) Without giving to them notice of lockout provided within 6 weeks before locking out.

(ii) Within 14 days of giving such notice.

(iii) Before expiry of the date of lockout specified in any such notice.

(iv) During the pendency of any conciliation proceedings before a Conciliation Officer and 7 days after the conclusion of such proceedings.

12. What compensation will a workman get when laid off?

Whenever a workman (other than a badli workman or a casual workman) whose name is borne on the muster rolls of an industrial establishment employing 50 or more workmen on an average working day and who has completed not less than one year of continuous service under an employer laid off, whether continuously or intermittently, he is to be paid by the employer for all days during which he is so laid off, except for such weekly holidays as may intervene, compensation which shall be equal to fifty per cent of the total of the basic wages and dearness allowance that would have been payable to him had he not been so laid-off.

13. What are the conditions precedents to retrenchment of workmen?

No workmen employed in any industry who has been in continuous service for not less than one year under an employer can be retrenched by that employer until:

(a) The workman has to be given one month’s notice in writing indicating the reasons for retrenchment or the workman has to be paid in lieu of such notice, wages for the period of the notice.

(b) The workman has to be paid, at the time of retrenchment, compensation which is equivalent to fifteen days’ average pay (for every completed year of continuous service) or any part thereof in excess of six months; and

(c) Notice in the prescribed manner is to be served on the appropriate Government (or such authority as may be specified by the appropriate Government by notification in the Official Gazette).

14. What compensation will the workman get when an undertaking closes down?

Where an undertaking is closed down for any reason whatsoever, every workman who has been in continuous service for not less than one year in that undertaking immediately before such closure is entitled to notice and compensation in accordance with the provisions as if the workman had been retrenched.

Provided that where the undertaking is closed down on account of unavoidable circumstances beyond the control of the employer, the compensation to be paid to the workman is not to exceed his average pay for three months.

Note: book for reference, legal Aspects for hospitality & travel –tourism industry by Dr.Atul Bansal