The Factories Act is a legislation that deals with safety, health and welfare of workers. The present Factories Act is applicable on factories (with electricity connection) with 20 workers and factories, without electricity, with 10 workers.
The government had introduced Factories (Amendment) Bill 2014 in Lok Sabha in August 2014. However, it did not come up for discussion as it was referred to a standing committee which presented its report in December 2014.
Objective of amendments:
- Ease of doing business
- Removing redundant provisions and incorporating new provisions in line with current conditions of factories and technology.
- To do away with the ‘inspector raj.’
What are the amendments proposed?
- The proposed law will apply to all factories that employ at least 40 workers
- Registration of factories will also be made online and entrepreneurs will only have to submit a self-certified declaration on the safety, health and welfare standards of the factory to get approvals for setting up a factory
- Apart from speeding up registration and compliance processes to help new entrepreneurs and start-ups, the proposed new Factories Act seeks to do away with the ‘inspector raj.’
- To increase the level of competency of the inspectors, the labour ministry has proposed that only those with a minimum B.Tech degree can become inspectors and they can enter factory premises after specific written directions of the Chief Inspector.
- However, the inspection could take place without prior consent if there is a complaint from any worker or for carrying out investigation into a reported accident. This has been proposed to remove the arbitrariness in inspection.
- However, existing inspectors with five years of experience or more, and a degree or diploma on industrial safety will continue to be eligible to inspect a factory.
- All factories that manufactures or deals with “hazardous substance and processes and dangerous operations will be covered under this Act even if they employ a single worker.” The sectors that manufacture hazardous processes include coal, gas, iron and steel, petroleum, cement and leather.
- For setting up factories with hazardous activities, the site appraisal committee — a body with representatives from environment, meteorological, town planning departments — will have to convene a meeting within 15 days of receiving an application.
- The committee will have to compulsorily send its recommendations within the next 30 days to the state government, from 90 days at present.
- The proposed law will apply to all factories that employ at least 40 workers.
Why there are demand for amendments?
Demand for revamping Factories Act, 1948 stems from the following arguments-
- The legislation explicitly bars women from certain occupations like working “near or machinery in motion” and hence perpetuates gender inequality
- Act stipulates Sunday as the weekly holiday and thus leads to situation where all factories work on the same days i.e. Monday to Saturday. In this situation, there is great demand for power. If authority is given to factory owner to decide their day of holiday, it can ease down the demands on certain days
- The provision of providing cool drinking water applies to factories that employ more than 250 workers and hence factories with lesser workers do not enjoy such benefits
- The law uses British systems of units i.e. horsepower instead of India’s metric system that use Kilo Watthours and hence creates confusion
- Currently, the law requires entrepreneurs to inform authorities about the total rated horsepower installed before they can commence operations- a not so business friendly practice
- Present law requires an employee to work for 240 days before he becomes eligible for leave with pay and hence the act is not employee friendly
Why Trade Unions are opposed to them?
- According to them, these moves would allow more factories to stay out of the ambit of the Factories Act as factories with less than 40 workers will be out of purview of this Act