UNIVERSITY INSTITUTE OF LEGAL STUDIES

PROJECT REPORT

ON

UNORGANISED SECTOR - LABOUR LAWS

AND CONSTITUTIONAL PROTECTION

Hargun Sandhu

Submitted to: - 195/15 9th semester

Dr.Virender Negi B.Com. LL.B. (Hons.)

UILS Section D

Panjab University

Submitted by: -
 Acknowledgement

The project has been compiled by Hargun Sandhu, roll number 195/15 of 9th semester on the topic
‘UNORGANISED SECTOR - LABOUR LAWS AND CONSTITUTIONAL PROTECTION ’. Apart from the
efforts of myself, the success of any project depends largely on the encouragement and guidelines
of many others. I take this opportunity to express my gratitude to the people who have been
instrumental in the successful completion of this project. I would like to show my greatest
appreciation to Dr.Virender Negi for her guidance and support in completion of this project. I can’t
say thank you enough for her tremendous support and help. I would like to thank my friends for
motivating me and appreciating my work. I would also like to thank the library staff for providing
relevant materials.
 Table of Cases

B.Shah v. Presiding Officer, Labour Commissioner (1977) 4 SCC 384.................................17

BandhuaMuktiMorcha v. Union of India, AIR 1984 SC 802..................................................25

Builders Assn. of India v. Union of India, 2007 ILR (2007) 1 Del 1143................................19

Consumer Education and Research Centre and others v. Union of India and others, (1995) 3 SCC 42
..............................................................................................................................................26

D.K. Yadav v. J.M.A. Industries, (1993) 3 SCC 258...............................................................23

Damayanti v. Union of India, AIR 1971 SC 966.....................................................................22

Deena v. Union of India, AIR 1983 SC 1155..........................................................................24

Dewan Chand Builders & Contractors v. Union of India, (2012) 1 SCC 101.........................19

DhirendraChamoli v. State of U.P , AIR 1986 SC 172............................................................22

Express Newspaper (P)-Ltd. v. Union of India AIR 1958 SC 578..........................................26

F.A.I.C. and C.E.S. v. Union of India, AIR 1988 SC 1291.....................................................22

Francis Coralie v. Union Territory of Delhi, AIR 1981 SC 746..............................................23

Gammon India Ltd. vs. Union of India (1974) 1 SCC 596......................................................18

Labourers Working on Salal Hydro Project v. State of Jammu and Kashmir and others, AIR 1984
SC 177..................................................................................................................................25

Life Insurance Corporation of India v. Consumer Education and Research Centre, 1995 SCC (5)
482........................................................................................................................................21

M/s Sathish Plastics V. Regional Provident Fund Commissioner, (1981) II LLJ 277............17

Maneka Gandhi v. Union of India, AIR 1978 SC 597.............................................................23

Municipal Corporation of Delhi v. Female Workers (Muster Roll) 2000 (2) SC Almanac 26917
National Campaign Committee for Central Legislation on Construction Labour (NCC-CL) v. Union
of India, (2018) 5 SCC 607..................................................................................................19

Neeraja Chaudhary V. State of Madya Pradesh, AIR 1984 SC 1099......................................25

Olga Tellis v. Bombay Municipal Corporation, AIR 1986 SC 180.........................................23

P. Shivaswamy v. State of Andhra Pradesh, AIR 1988 SC 1863............................................26

P.M. Patel v. Union of India and others (1986) 1 LLJ 88 (SC)...............................................17

Peoples’ Union for Democratic Rights v. Union of India AIR 1982 SC 1473..........................6

Randhir Singh v. Union of India, AIR 1982 SC 879...............................................................21

Salel Hydro Project v. State of Jammu & Kashmir, 1983 LLJ 494.........................................23

Sanjit Roy v. State of Rajasthan, AIR 1983 SC 328................................................................24

TABLE OF CONTENT
1. INTRODUCTION................................................................................................................1

2. MEANING OF UNORGANISED SECTOR.....................................................................1

3. CATEGORIES.....................................................................................................................2

3.1. IN TERMS OF OCCUPATION...................................................................................3

3.2. IN TERMS OF NATURE OF EMPLOYMENT.............................................................3

3.3. IN TERMS OF SPECIALLY DISTRESSED CATEGORIES............................................3

3.4. IN TERMS OF SPECIALLY DISTRESSED CATEGORIES............................................3

4. CHARACTERSTICS..........................................................................................................3

5. IMPORTANCE OF UNORGANISZED SECTOR AND THEIR MAGNITUDE........4

6. PROBLEMS FACED BY UNORGANISED SECTOR....................................................5

6.1. LACK OF RECOGNITION................................................................................5

6.2. INSECURITY OF JOB........................................................................................5

6.3. IRREGULARITIES AND INABILITY TO SECURE EVEN MINIMUM WAGES 6

6.4. LONG HOURS OF WORK.................................................................................7

6.5. POVERTY AND INDEBTEDNESS...................................................................7

6.6. OCCUPATIONAL HAZARDS AND HEALTH ISSUES..................................7

6.7. LACK OF PROPER PHYSICAL ENVIRONMENT AT PLACE OF WORK. .8

6.8. NO RECOURSE TO COLLECTIVE BARGAINING........................................8

6.9. LACK OF SOCIAL SECURITY COVER..........................................................9

6.10. LACK OF OLD AGE SECURITY......................................................................9

6.11. LACK OF EMPLOYER-EMPLOYEE RELATIONSHIP..................................9

6.12. INSECURITY ARISING OUT OF NATURAL DISASTERS.........................10

 6.13. VULNERABLE LABOUR GROUPS...............................................................10

6.14. LESS ACCESS TO CAPITAL..........................................................................10

7. SOCIAL SECURITY REGIME IN INDIA.....................................................................11

7.1. SCHEMES.........................................................................................................11

7.2. GENERAL LEGISLATIONS............................................................................15

7.3. SPECIAL LEGISLATIONS..............................................................................18

8. CONSTITUTIONAL PROTECTION TO UNORGANISED SECTOR......................21

8.1. FUNDAMENTAL RIGHTS..............................................................................21

8.2. DIRECTIVE PRINCIPLES OF STATE POLICY............................................25

BIBLIOGRAPHY...................................................................................................................................28
 1. INTRODUCTION

The concept of an informal or unorganized sector began to receive world-wide attention in the
early 1970s, when the International Labour Organization initiated series efforts to identify and
study the area through its World Employment Programme Missions in Kenya, Columbia, Sri
Lanka and Philippines primarily underlined the development strategy based on economic growth
in which employment was considered as the prime objective for development. 1 The British
Economist Keith Hart in 1971 coined the term informal sector.2

2. MEANING OF UNORGANISED SECTOR

According to International Conference of Labour Statisticians the terms unorganised and

informal sectors are often used interchangeably.

The First National Commission on Labour, under the Chairmanship of Hon’ble Justice
Gajendragadkar, defined the unorganised sector as that part of the workforce ’who have not been
able to organise in pursuit of a common objective because of constraints such as (a) casual nature
of employment, (b) ignorance and illiteracy, (c) small size of establishments with low capital
investment per person employed, (d) scattered nature of establishments and (e) superior strength
of the employer operating singly or in combination.’3

Section 2(l) of the Unorganized Workers’ Social Security Act, 2008 defines ‘Unorganized
Sector’ as an enterprise owned by individuals or self employed workers and engaged in
production or sale of goods or providing service of any kind whatsoever, and where the
enterprise employs workers, the number of such workers is less than ten. Section 2(m) of the Act
further stipulates that unorganized worker means a home-based worker, self employed worker or
a wage worker in the unorganized sector and includes a worker in the organised sector who is not
covered by any of the acts mentioned in schedule II of the Act that are:

 The Workmen’s Compensation Act, 1923.

1
R.S.Tiwari, Informal Sector Workers: Problems and Prospects, (New Delhi: Anmol Publishers) 2005 Edition, p.5.
2
Kanak KanthiBagchi and Nirupam Gobi, Social Security for Unorganised Workers in India (Gurgaon: Madhav
Books) 2012 Edition p.22.
3
Government of India, Report of National Commission on Labour, (1969) p. 417.

1|Page
  The Industrial Disputes Act, 1947.
 The Employees’ State Insurance Act, 1948.
 The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.
 The Maternity Benefit Act,1961.
 The Payment of Gratuity Act, 1972

3. CATEGORIES

The Ministry of Labour, Government of India, 4 has categorized the unorganised labour force
under four groups in terms of occupation, nature of employment, especially distressed categories
and service categories.

CATEGORIES

NATURE OF
OCCUPATION DISTRESSED SERVICE
EMPLYMENT

3.1. IN TERMS OF OCCUPATION

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

4
Report of National Commission on Labour, 1969.

2|Page
 3.2. IN TERMS OF NATURE OF EMPLOYMENT

Attached agricultural labourers, bonded labourers, migrant workers, contract and casual
labourers come under this category.

3.3. IN TERMS OF SPECIALLY DISTRESSED CATEGORIES

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

3.4. IN TERMS OF SPECIALLY DISTRESSED CATEGORIES

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

In addition to the above categories, there exists a large section of unorganised labour force such
as cobblers, hamals, handicraft artisans, handloom weavers, lady tailors, physically handicapped
self-employed persons, rikshaw pullers/ auto drivers, sericulture workers, carpenters, leather and
tannery workers, power loom workers and urban poor.5

4. CHARACTERSTICS

a) It is in general a low wage and low earning sector.

b) Low scale of organization
c) operation of labour relations on a casual basis, or on the basis of kinship or personal relations
d) easy entry and exit
e) free mobility within the sector
f) use of indigenous resources and technology
g) use of labour intensive technology
h) Women constitute an important section of the workers in this sector
i) Economic activities, which engage child labour, fall within this sector.
j) Migrant labour is involved in some sub-sectors.

5
Ibid.

3|Page
k) Piece-rate payment, home-based work and contractual work are increasing trends in this
sector.
l) Direct recruitment is on the decline. Some employees are engaged through contractors.
m) If some kinds of employment are seasonal, some others are intermittent. As such,
underemployment is a serious problem.
n) i) Most jobs are, for the greater part, on a casual basis.
o) Workers are not often organised into trade unions. There are many co-operatives of self-
employed workers.
p) Very often, others supply raw materials, Production by self employed workers, therefore,
becomes dependent on, or linked with enterprises or individuals active in other sectors.
q) The self-employed have less access to capital. Whatever capital they manage, is mostly from
non-banking and usurious sources, especially from the trader-contractor.
r) Health hazards exist in a majority of occupations.6

5. IMPORTANCE OF UNORGANISZED SECTOR AND THEIR

MAGNITUDE

The unorganized sector has grown by leaps and bounds over the years. As per the survey carried
out by the National Sample Survey Organization in the year 2009-2010, the total employment in
both organised and unorganized sector in the country was of the order of 46.5 crore. Out of this,
about 2.8 crore were in the organised sector and the balance 43.7 crore in the unorganized
sector.7 It plays a fundamental role in terms of providing employment opportunity to large
segment of the working force in the country i.e. more than 90% of the population and as per the
latest estimation of a Sub-committee of the National Commission for Enterprises in the
Unorganized Sector (NCEUS), the contribution of unorganized sector to GDP is about 50%
(NCEUS 2008).8

Since the unorganized sector plays pivotal role in the Indian economy, it needs special attention.
The International Labour Organization in its Convention No. 102, enumerated nine risks or core
contingencies from which unorganised or informal workers need to be protected that lead to the

6
Report of Second National Commission on Labour, (2002).
7
http://shodhganga.inflibnet.ac.in/bitstream/10603/76677/12/12_chapter%205.pdf
8
https://www.arcjournals.org/pdfs/ijmsr/v4-i1/9.pdf

4|Page
stoppage or substantial reduction of earnings namely; (i) Sickness (ii) Maternity (iii)
Employment Injury (iv) Unemployment (v) Invalidity (vi) Old Age (vii) Death (viii) Need for
long term medical care and (ix) Need to support families with children.9

6. PROBLEMS FACED BY UNORGANISED SECTOR

The problems of unorganised sector are as follows;

6.1. LACK OF RECOGNITION

The Second Labour Commission in its report dated 29th June 2002 stated that workers in the
unorganised sector are not recognized as ‘workers’. No effort to improve the conditions of
workers in the unorganised sector can bear fruitful results unless the workers in the unorganised
sector are identified as ‘workers’. In light of this, the Commission recommended that the first
objective in the direction to improve the lot of unorganised sector should be to identify and
recognize workers in the unorganised sector are identified as ‘workers’.

6.2. INSECURITY OF JOB

The sample study of economic activities undertaken by the Second Labour Commission’s study
group revealed that most jobs are, for the greater part, on a casual basis. A single job or even two
may generate income barely enough for subsistence.10 Furthermore, some kinds of employment
are seasonal and some others are intermittent. For instance employment of agricultural labour is
irregular and unassured11 due to availability of work to them only for about three months and the
remaining nine months, they are mostly unemployed and suffer from starvation.12 Though
Mahatma Gandhi National Rural Workers Employment Guarantee Act, 2005 has been enacted to
provide employment security by guaranteeing at least 100 days of work in the most backward

9
Social Security (Minimum Standards) Convention (No. 102).
10
Government of India, Report of the Committee on Unorganised Sector Statics, National Statistical Commission,
(2012).
11
National Commission for Enterprises in the Unorganised Sector, Report on Condition of Work and Promotion of
Livelihoods in the Unorganised Sector, 2007at 126.
12
Dr.Suresh Srivastava, “Social security for Agricultural Workers in India”, In: Debi.S. Saini editor, Labour Law, Work
and Development (New Delhi: Westvill Publishing House 1995 Edition, p.106.

5|Page
districts of the country who can perform manually 13 but, informal workers continue to face the
risk of loss of employment as they are varied by nature and location.

6.3. IRREGULARITIES AND INABILITY TO SECURE EVEN

MINIMUM WAGES

Most of the studies on conditions of employment in the unorganised sector have examined the
wage levels and earnings of workers and identified that the daily wages are below the minimum
rate of wages and the Hon’ble Supreme Court in Peoples’ Union for Democratic Rights v. Union
of India14 has adumbrated in explicit words that employing workers at wage rates below the
statutory minimum wage levels was equivalent to forced labour and prohibited under Article 23
of the Constitution on India even though economic compulsion might drive one to volunteer to
work below the statutory minimum wage. There is no uniformity in wage structure across the
various States or Union Territories.15 This is also due to applicability of the Minimum Wages Act
only to certain employments which does not include all workers.

6.4. LONG HOURS OF WORK

The long working hours have a severe repercussion on the social and family life of labourers in
general and women labourers in particular. They do not find any time to take part in cultural or
social activities. They do not even take proper child care.16

6.5. POVERTY AND INDEBTEDNESS

Workers in the unorganised sector have a much higher incidence of poverty than their
counterparts in the organised sector.17 Due to low level of income and uncertain employment in
the unorganised sector make the workers unable to meet their basic necessities and other social
and other cultural responsibilities. In agricultural sector, it is an undeniable fact that increased

13
National Commission for Enterprises in the Unorganised Sector, Report on Social Security for Unorganised
Workers, 2006 p. 22
14
Peoples’ Union for Democratic Rights v. Union of India AIR 1982 SC 1473.
15
Government of India, “Report of the Working of The Minimum Wages Act, (2013), p.1.
16
Arjun Patel and Desai Kiran, “Rural Migrant Labour and Labour Laws”, In: Debi.S. Saini editor, Labour Law, Work
and Development (New Delhi: Westvill Publishing House) 1995 Edition, p.64.
17
Kannan K.P., “How Inclusive is Inclusive Growth in India”, Working Paper WP03/2012, New Delhi: Institute for
Human Development (IHD).

6|Page
indebtedness is a major factor for suicide in various states. 18 Since the wage levels are very low,
they are worst in terms of poverty level and economic status.

6.6. OCCUPATIONAL HAZARDS AND HEALTH ISSUES

Many studies show health risk as the primary risk of informal sector workers. 19 The working
conditions in the unorganised sector are the main cause that has an adverse effect on the health
conditions of workers. Low nutritional intake due to low income, constant physical labour
increases health problems to the workers in the unorganised sector resulting in risks of life of
unorganised workers. Furthermore, lack of resources to pay for the health care often forces the
poor workers either to forego it or become indebted.

Occupational illness and diseases have been reported among workers in many industries of
unorganised sector.20 With regard to home workers most of the health problems mainly relate to
respiratory due to inhalation of tobacco dust and body ach due to the peculiar posture that has to
be maintained at all times of work.21 In some of the sectors like Tobacco- processing units the
workers have to do their entire job such as plucking, winnowing, grading and packaging, while
they are surrounded by heaps of tobacco, which is considered to be unhygienic to the health. 22
The factory owners do not take proper care of the workers as they do not provide them adequate
facilities. Similarly, salt pan workers are also found to be suffering from skin diseases as they
have to work constantly in salty water. They develop severe eye problems due to the reflection of
light from the heap of salt.23 In agricultural sector due to extensive use of fertilizers, insecticides
and pesticides and mechanization workers suffer from certain specific health hazards.

18
National Commission for Enterprises in the Unorganised Sector, Report on Condition of Work and Promotion of
Livelihoods in the Unorganised Sector, 2007 at 135.
19

20
National Commission for Enterprises in the Unorganised Sector, Report on Condition of Work and Promotion of
Livelihoods in the Unorganised Sector, 2007 at 34.
21
National Commission for Enterprises in the Unorganised Sector, Report on Condition of Work and Promotion of
Livelihoods in the Unorganised Sector, 2007 at 73.
22
Arjun Patel and Desai Kiran, “Rural Migrant Labour and Labour Laws”, In: Debi.S. Saini editor, Labour Law, Work
and Development (New Delhi: Westvill Publishing House) 1995 Edition at 72.
23
Ibid.

7|Page
 6.7. LACK OF PROPER PHYSICAL ENVIRONMENT AT PLACE
OF WORK

The unorganised sector is marred by the vice of poor infrastructure and lack of basic services
which result in poor working conditions making the workers more susceptible to the hazards
associated with employment.

6.8. NO RECOURSE TO COLLECTIVE BARGAINING

Workers are often not organised into trade union especially the self– employed ones. Thus there
is not much recourse to collective bargaining as they are unable to voice their feelings or dissent
against the attitude of employers in order to protect their interests. This lack of organization can
also traced to lack of awareness and illiteracy. Despite the increased recognition of informal
sector’s contribution to employment and gross domestic product among others the lack of
worker’s rights and legal status has tended to adversely affect worker’s prospects.

6.9. LACK OF SOCIAL SECURITY COVER

Even though the concept of social security is implicit in Indian Constitution, the Second Labour
Commission in its report recognized that the situation of social security to workers in the
unorganized sector in India is far from satisfactory even after 62 years of the adoption of the
Indian Constitution.

It was further held that social security situation in India is characterized by ambiguity in policy
and responsibility. Though a variety of schemes have been formulated but they have been
enacted at various points of time and therefore, do not conform to any overall design reflecting a
comprehensive and consistent policy or direction. Furthermore, despite the goal of social
economic justice, India spends little/ meager amount on social security. The economically
developed countries have established social and safety nets on which they are spending upto 40%
of their GDP. Developing countries generally and India in particular are lagging behind.
According to the World Labour Report, 2000 the public expenditure on social security in India is
1.8% of GDP as against 4.7% in Sri Lanka and 3.6% in China.

8|Page
 6.10. LACK OF OLD AGE SECURITY

The old age is a major concern of the workers in the unorganised sector workers and most of the
provisions relating to provident fund do not reach the construction workers and contract
labourers.24

6.11. LACK OF EMPLOYER-EMPLOYEE RELATIONSHIP

The enterprises in the unorganised sector are mainly unregistered units. Apart from that, the
entire basis of establishing a master-servant relationship becomes the first hurdle to apply labour
laws to this sector. The employee prefers to work for several employers in case he is not given
any work on a particular day or sometimes for days together. The other difficulty is the fact that
a number of home based workers work through contractors and thus miss their direct relationship
with the employers for whom they work. Moreover, workers engaged in these enterprises often
tend to change employers frequently and therefore it is easy for the employer not to recognize the
workers which results in denial of benefits arising out of Minimum Wages Act and Social
security benefits.

6.12. INSECURITY ARISING OUT OF NATURAL DISASTERS

There are many natural disasters like floods, drought, famine, earth quake etc., which also have
a devastating impact on the informal sectors. Natural disasters do not only wipe out the
productive base of the informal sector, but can also affect the limited household assets of the
own.25

6.13. VULNERABLE LABOUR GROUPS

The study group on construction of the First National Commission on Labour as well as Second
National Commission (2002) observed that in quarries, brick-kilns as well as in big construction
sites a system of bondage exists and gets extended from one generation to the next through child

24
National Commission for Enterprises in the Unorganised Sector, Report on Condition of Work and Promotion of
Livelihoods in the Unorganised Sector, 2007 at 41.
25
SudharshanCanagarajha and S.V.Sethuraman, “Social Protection and the Informal Sectors in Developing
Countries: Challenges and Opportunities”, Discussion paper series No.0130 (Washington: World Bank Publication)
2001, p. 74.

9|Page
labour.26 Apart from migrant labourers, bonded labourers and child workers constitute as a major
vulnerable groups who are the most deprived and exploited.

6.14. LESS ACCESS TO CAPITAL

The self-employed have less access to capital. Whatever capital they manage, is mostly from
non-banking and usurious sources, especially from the trader-contractor.27

7. SOCIAL SECURITY REGIME IN INDIA

SOCIAL
SECURITY
REGIME

GENERAL SPECIAL
SCHEMES LEGISLATI LEGISLATI
ONS ONS

7.1. SCHEMES

1.1.1. SCHEMES LISTED IN SCHEDULE I OF THE SOCIAL SECURITY ACT, 2008.

 INDIRA GANDHI NATIONAL OLD AGE PENSION

The National Old Age Pension Scheme renamed as Indira Gandhi National Old Age Pension
came into force on 19th November 2007 with the aim of extending financial assistance to old
destitute who have little or no means of subsistence. Under the scheme, the beneficiary (male or
female) aged 65 years or higher belonging to a household below poverty line according the
criteria prescribed by the Government of India will be provided Central Assistance (pension) at
the rate of Rs. 200 per month which shall credited, where feasible, into a post office or public

26
National Commission For Women, Report on The Status Of Women Workers in the Construction Industry, (2005),
pp 2-3.
27
http://www.prsindia.org/uploads/media/Unorganised
%20Sector/bill150_20071205150_National_Commission_on_Labour_2_Chapter_7_unorganised_sector_Part_A.pd
f.

10 | P a g e
sector bank of the beneficiary. This old-age pension is non-contributory in the sense that the
beneficiary has not contributed any premium over his or her lifetime; hence, it is more in the
nature of social assistance.

 RASHTRIYA SWASTHYA BIMA YOJANA

The Scheme, originally an initiative of Labour and Employment Ministry was transferred to the
Ministry of Health and Family Welfare with effect from 1st April 2015 and provides for IT-
enabled and smart–card-based cashless healthy insurance, including maternity benefit cover up
to Rs. 30,000/- per annum on a family floater basis to BPL families (a unit of five) and 11
occupational groups in the unorganized sector.

 AAM ADMI BIMA YOJANA

Ministry of Finance, Government of India has approved the merger of Social Security Schemes
viz., AamAdmiBimaYojana (AABY) and JanashreeBimaYojana (JBY) and the merged scheme
“AamAdmiBimaYojana” came into effect from 1st January 2013. Under the scheme one member
normally the head of the family or one earning member of the below poverty line family (BPL)
or marginally above the poverty line under identified vocational group/rural landless household
aged between 18 completed and 59 nearer birthday years shall be covered.

S.NO CIRCUMSTANCES BENEFIT ACCRRUING

TO THE NOMINEE

1 NATURAL DEATH 30,000

2 DEATH DUE TO ACCIDENT/ 75,000

PERMANENT DISABILITY DUE TO ACCIDENT

(LOSS OF TWO EYES OR LIMBS)

3 ON PARTIAL PERMANENT DISABILITY DUE TO 37,500

ACCIDENT ( LOSS OF ONE EYE OR LIMB)

11 | P a g e
The total annual premium under the scheme is Rs. 200/- per beneficiary of which 50% is
contributed from the Social Security Fund created by the Central Government and maintained by
LIC. The balance 50% of the premium is contributed by the State Government / Nodal Agency /
Individual, as the case may be. The Scheme also provides an add-on-benefit, wherein
Scholarship of Rs 100 per month per child is paid on half-yearly basis to a maximum of two
children per member, studying in 9th to 12th Standard.

 NATIONAL FAMILY BENEFIT SCHEME (NFBS)

The NFBS, a part of National Social Assistance Programme formulated on 15 th August 1995
provides a lump sum family benefit of Rs. 20000 to the bereaved household in case of death of
the primary bread winner irrespective of the cause of death. This scheme is applicable to all the
eligible persons belonging to BPL families in the age group of 18-64.

 JANANI SURAKSHA YOJANA (JSY)

JSY, a 100% centrally sponsored scheme is a safe motherhood intervention under the National
Rural Health Mission (NHM) was implemented with the objective of reducing maternal and
infant mortality by promoting institutional delivery among pregnant women belonging to the
Below Poverty Line (BPL) households and ST category. Under the scheme, eligible pregnant
women are entitled for cash assistance irrespective of the age of mother and number of children
for giving birth in a government or accredited private health facility. The scheme also provides
performance based incentives to women health volunteers known as ASHA (Accredited Social
Health Activist) for promoting institutional delivery among pregnant women.  Cash entitlement
for different categories of mothers is as follows:

CATEGORY RURAL AREA URBAN AREA

MOTHER’S ASHA’S MOTHER’S ASHA’S

PACKAGE PACKAGE PACKAGE PACKAGE

12 | P a g e
LOW PERFORMING STATES 1400 600 1000 400

( STATES HAVING
INSTITUTIONAL DELIVERY
25% OR LESS)

HIGH PERFORMING STATES 700 600 600 400

BPL pregnant women, who prefer to deliver at home, are entitled to a cash assistance of Rs. 500
per delivery regardless of the age of pregnant women and number of children.

 HANDLOOM WEAVERS COMPREHENSIVE WELFARE SCHEME

Handloom Weavers Comprehensive Welfare Scheme has the following components:-

i. Life, accidental and disability insurance coverage under the Pradhan

MantriJeevanJyotiBimaYojana (PMJJBY), Pradhan Mantri Suraksha BimaYojana
(PMSBY) and Converged Mahatma Gandhi BunkarBimaYojana (MGBBY) components
from 2017-18 to 2019-20.
 PadhanMantriJeevanJyotiBimaYojana (PMJJBY):- Under this scheme, life
insurance of Rs. 2 lakh would be available on the payment of premium of Rs. 330
per annum by the subscribers. The scheme can be availed by people in the age
group of 18 to 50 years having a bank account from where the premium would be
collected through the facility of "auto-debit".
 Pradhan Mantri Suraksha BimaYojana (PMSBY):- Under this scheme, the risk
coverage available is Rs. 2 lakh for accidental death and full disability and Rs. 1
lakh for permanent partial disability on the payment of premium of Rs. 12 per
annum. The Scheme will be available to people in the age group 18 to 70 years
with a bank account, from where the premium would be collected through the
facility of "auto-debit".

13 | P a g e
  Mahatma Gandhi BunkarBimaYojana (MGBBY):- Under this scheme, all
handloom weavers male or female between age group of 18 to 59 years and who is
earning atleast 50% of his income from handloom weaving are eligible to be
covered. State Director, incharge of Handlooms verify the eligibility of the
weavers.
ii. Health Insurance Scheme on RSBY pattern to meet the committed liabilities upto 31 st
March 2018.
 HANDICRAFT ARTISANS’ COMPREHENSIVE WELFARE SCHEME

Handicraft constitutes an important segment of the unorganised sector of our economy. In order
to address the welfare needs of artisan in terms of health and dwelling insurance, this scheme has
been envisaged.

 Rajiv Gandhi ShilpiSwasthyaBimaYojana:-This Yojana aims of financially enabling the

artisans’ community to access the best of health care facilities in the country. This scheme
covers the artisan, his wife and two children.
 BimaYojana for Handicraft Artisans:-The objective is to provide life insurance protection to
the Handicraft Artisans, whether male or female, between the age group of 18-60 years.

1.1.2. LATEST SCHEME:

 AYUSHMAN BHARAT YOJANA (ABY)

Launched on 14th April 2018, ABY or Pradhan Mantri Jan ArogyaYojana (PMJAY) or National
Health Protection Scheme aims to achieve dual goals i.e. (i) creating a network of health and
wellness infrastructure across the nation to deliver comprehensive primary healthcare services
(ii) to provide insurance cover to at least 40 per cent of India's population which is majorly
deprived of secondary and tertiary care services. InduBhushan and Dr Dinesh Arora have been
appointed as a Chief Executive Officer (CEO) and deputy CEO of Ayushman Bharat Yojana
respectively.

14 | P a g e
 7.2. GENERAL LEGISLATIONS

i. The Workmen’s Compensation Act, 1923:- The Act applies to the unorganised sectors and
to those in the organised sectors who are not covered by the Employees State Insurance
Scheme. It provides for payment of compensation to workmen and their dependants in case
of injury and accident (including certain occupational disease) arising out of and in the
course of employment and resulting in disablement or death. The amount of compensation to
be paid depends on the nature of the injury and the average monthly wages and age of
workmen.
ii. Industrial Disputes Act 1947:-The Industrial Disputes Act 1947 extends to the whole of
India and regulates Indian labour law so far as that concerns trade unions as well as
individual workman employed in any Industry within the territory of Indian mainland
irrespective of the number of workmen employed therein. It came into force April 1, 1947
with the object to secure industrial peace and harmony by providing machinery and
procedure for the investigation and settlement of industrial disputes by conciliation,
arbitration and adjudication machinery which is provided under the statute. 
iii. Minimum Wages Act, 1948:- The Act provides for fixing minimum rates of wages in
certain employments. The employments are those which are included in the schedule and are
referred to as ‘Scheduled Employments’. The Code on Wages Bill 2017 has been introduced
and proposes to subsume 4 existing Laws, viz. the Minimum Wages Act, 1948; the Payment
of Wages Act, 1936; the Payment of Bonus Act, 1965; and the Equal Remuneration Act,
1976. After the enactment of the Code on Wages, all these four Acts will get repealed. The
new Code on Wages will ensure minimum wages to one and all and timely payment of wages
to all employees irrespective of the sector of employment without any wage ceiling.
iv. The Employee State Insurance Act, 1948:-The objective of the Act is to provide certain
benefits to employees in case of sickness, maternity and injury (during employment). It
applies to factories using power in the manufacturing process and employing 10 or more
persons and non-power using factories or establishments employing 20 or more persons for
wages. The Act contains an enabling provision under which Appropriate Government is
empowered to extend the provision of the ESI Act, 1948 to other classes of establishments
i.e., Industrial, Commercial and Agricultural or otherwise. The Government of India

15 | P a g e
 through notification in the Official Gazette has amended the Employees’ State Insurance
(Central) Rules, 1950.  Accordingly, as per Rule 50, the wage limit for coverage of an
employee under Employees State Insurance Act has been enhanced from Rs. 10,000 to Rs.
15,000 with effect from 1st May 2010.
v. Employees’ Provident Fund & Miscellaneous Provisions Act, 1952:-The Act seeks to
provide compulsory provident fund, pension, deposit-linked insurance funds for employees.
It is applicable to every establishment which is a factory engaged in any industry specified in
Schedule 1 and in which 20 or more persons are employed, and to any other establishment
employing 20 or more persons or class of such establishments which the Central Government
by notification on the official gazette specify in this behalf.

With regard to the coverage of home workers under the Employees’ Provident Funds and
Miscellaneous Provisions Act, 1952, in P.M. Patel v. Union of India and others,28 the question
arose for consideration was whether the workers employed at their homes in the manufacture of
beedis are entitled to the benefit of Employees’ Provident Funds and Miscellaneous Provisions
Act, 1952. The term of definition of employee under section 2(f) of the Act are wide enough to
include persons employed directly by the employer and also through a contractor and they also
isnclude persons employed in the factory and persons employed in connection with the work of
the factory. The fact that the home workers deliver the beedis to the manufacturer who has a
right of rejecting those that do not confirm to the standards clearly shows the degree of control
and supervision for establishing the relationship of master and servant between the home
workers and manufacturers. Hence, home workers are employees.29

vi. Maternity Benefit Act, 1961:-The Act is applicable to persons working in factories, mines,
plantations, commercial and other notified establishments. Its coverage can therefore extend
to the unorganised sector also.The Act provides for maternity protection before and after
child birth. It was amended in 2017 to increase maternity leave entitlement from 12 weeks to
26 weeks for the first two children for our 65 crore women.

In the case of maternity benefit, the Supreme Court has held that even female workers engaged
on casual basis or on muster roll on daily wages are also entitled to benefit under the Maternity
28
P.M. Patel v. Union of India and others (1986) 1 LLJ 88 (SC).
29
M/s Sathish Plastics V. Regional Provident Fund Commissioner, (1981) II LLJ 277.

16 | P a g e
 Benefit Act, 1961 as nothing in the Act confers the benefit only on regular women employees. 30
The Supreme Court held that right to claim maternity benefit is recognized as the child bearing
role of women as a social function incorporated under Article 5(b) of Convention on Elimination
of all forms of Discrimination Against Women. Similarly, in B.Shahv. Presiding Officer, Labour
Commissioner31, it was rightly pointed out that “performance of the biological role of
childbearing necessarily involves withdrawal of a woman from the workforce for some period.
During this period she not only cannot work for her living but needs extra income for her
medical expenses. In order to enable the women worker to subsist during this period and to
preserve her health, the law makes provision for maternity benefit so that the women can play
both her productive and reproductive roles effectively”. Further, the court held that maternity
benefit is to be made for the entire period of actual absence including Sundays.

vii. Payment of Gratuity Act, 1972:- The Act provides for payment of gratuity as a retirement
benefit to employees inter alia engaged in private sector establishments who have been
employed for a minimum of 5 years of continuous service (with exceptions in case of death
or disablement) and the establishment employs 10 or more persons. Gratuity is calculated at
fifteen days of wages for each year of completed service (or part of the year in excess of six
months), subject to a ceiling. The present ceiling is Rs. 10 Lakhs which was fixed in 2010
(unless the employer and employee have agreed to a higher limit as better terms of
employment). By way of the Amendment Bill, 2017 the Government of India now proposes
to increase the aforesaid ceiling of Rs. 10 Lakhs to such amount as may be notified by the
Central Government. As of date, the proposed increase will be to Rs.20 Lakhs. 

7.3. SPECIAL LEGISLATIONS

There are some special laws designed only for the unorganised class:

i. Contract Labour (Regulation & Abolition) Act, 1970: It aims to regulate the employment
of the contract labour in every establishments employing twenty or more workmen and also
to provide for its abolition in certain circumstances. The underlying policy of the Act as was
elucidated by the Hon’ble Supreme Court in Gammon India Ltd. v. Union of Indi32 is to
30
Municipal Corporation of Delhi v. Female Workers (Muster Roll) 2000 (2) SC Almanac 269.
31
B.Shah v. Presiding Officer, Labour Commissioner (1977) 4 SCC 384.
32
Gammon India Ltd. vs. Union of India (1974) 1 SCC 596.

17 | P a g e
 abolish contract labour, wherever possible and practicable, and where it cannot be abolished
altogether, the policy of the Act is that the working conditions of the contract labour should
be so regulated as to ensure payment of wages and provision of essential amenities.
ii. Inter-State Migrant Workmen (Regulation Of Employment And Conditions Of Service)
Act, 1979: An act to provide the employment of inter-State migrant workmen and to provide
for their conditions of service.
iii. Iron Ore Mines, Manganese Ore Mines And Chrome Ore Mines Labour Welfare Fund
Act, 1976: An Act to provide for the financing of activities to promote the welfare of persons
employed in the iron ore mines, manganese ore mines and chrome ore mines.
iv. Beedi Workers Welfare Fund Act 1976 - An Act to provide for the financing of measures
to promote the welfare of persons engaged in beedi establishments.
v. Child and Adolescent Labour (Prohibition and Regulation) Act, 1986: An Act
prohibiting employment of child labour (i.e. a person below the age of 14 years) in any
establishment whether hazardous or not. A child is permitted to work only to help family, in
family enterprise or as child artist after school hours or during vacations. The Act as
amended in 2016 permits employment of adolescent labour (person between the ages of 14-
18 years) except in hazardous processes or occupation. 
vi. Building And Other Construction Workers (Regulation Of Employment And
Conditions Of Service) Act, 1996: An Act to regulate the employment and condition of
service of buildings and other construction workers and to provide for their safety, health and
welfare measures and for other matters connected therewith or incidental thereto. The Delhi
High Court in Builders Assn. of India v. Union of India33upheld the vires of the BOCW Act
and the Cess Act by holding that the enactments were not vague but consistent/ in keeping
with the directive principles of State policy. Affirming the decision of the Delhi High Court,
the Hon’ble Apex Court in in Dewan Chand Builders & Contractors v. Union of India34 that
its sole aim of the BOCW Act is the welfare of building and construction workers, directly
relatable to their constitutionally recognized right to live with basic human dignity, enshrined
in Article 21 of the Constitution of India. The Hon’ble Apex Court in its recent ruling in
National Campaign Committee for Central Legislation on Construction Labour (NCC-CL) v.

33
Builders Assn. of India v. Union of India, 2007 ILR (2007) 1 Del 1143.
34
Dewan Chand Builders & Contractors v. Union of India, (2012) 1 SCC 101.

18 | P a g e
 Union of India & Others35 dated 19th March 2018 emphasized that construction workers do
not assist only in building infrastructure, but they also assist in building the nation, in their
own small way and once that realization dawns upon those required to implement the BOCW
(Building and Other Construction Workers) Act and the Cess Act, perhaps due respect will
be shown to Article 21 of the Constitution and to Parliamentary statutes. The Hon’ble Court
also directed the State Governments and the UTAs to put in place and strengthen the
registration machinery, both for the registration of establishments as well as registration of
construction workers and also to constitute a State Advisory Committee, if not already
constituted.
vii. Unorganised Workers’ Social Security Act, 2008 - Finally, India has enacted an
Unorganised Workers’ Social Security Act, 2008 for providing social security to the
Unorganised Sector. The Act received the assent of President on 30 th December 2008 and is
applicable to whole of India36. It obligates the Central as well as State Governments to
formulate suitable welfare schemes for unorganised workers.37 To achieve its objective, there
is a provision for the constitution of the Board at National 38 and State level39 and also for the
funding of State Government Schemes40, for the performance of record keeping functions
by district administration41 and for the setup of the workers facilitation centre. 42 Finally it
empowers the Governments at Central43 and State levels44 for framing the rules. Lastly, all
unorganized sector workers above 14 years subsequent to their declaration that he/she is an
unorganised worker are entitled to register themselves and receive a ‘smart’ identity card. 45
In a recent ruling, the Division Bench of Hon’ble Apex Court in Bachpan Bachao &Ors v.
Union of India46 in an SLP originating from a Delhi High Court judgment, in which 256
women and children from West Bengal, employed as domestic workers in Delhi, without

35
National Campaign Committee for Central Legislation on Construction Labour (NCC-CL) v. Union of India, (2018) 5
SCC 607. 
36
Section 1(2) of the Unorganised Workers’ Social Security Act, 2008.
37
Section 3 of the Unorganised Workers’ Social Security Act, 2008.
38
Section 5 of the Unorganised Workers’ Social Security Act, 2008.
39
Section 6 of the Unorganised Workers’ Social Security Act, 2008.
40
Section 7 of the Unorganised Workers’ Social Security Act, 2008.
41
Section 8 of the Unorganised Workers’ Social Security Act, 2008.
42
Section 9 of the Unorganised Workers’ Social Security Act, 2008.
43
Section 13 of the Unorganised Workers’ Social Security Act, 2008.
44
Section 14 of the Unorganised Workers’ Social Security Act, 2008.
45
Section 10 of the Unorganised Workers’ Social Security Act, 2008.
46
https://www.livelaw.in/sc-directs-delhi-govt-register-domestic-workers-unorganised-workers-social-security-act/

19 | P a g e
 wages, were rescued and rehabilitated held that despite the Act coming into force in 2008 and
despite framing of several schemes, no domestic worker has enjoyed the benefit of any
scheme and gave the Delhi Government, three months to work on a pilot project, to see that
the domestic workers in Delhi are registered under the Unorganised Workers Social Security
Act, 2008, by eliciting cooperation on all the duty holders. 

8. CONSTITUTIONAL PROTECTION TO UNORGANISED SECTOR

The judiciary has played a significant role in the evolution of industrial jurisprudence and made a
distinct contribution towards innovative methods and devised strategies to ensure social justice to
weaker sections of the society which could be evidenced from a number of decisions. Therefore,
Indian judiciary has always been quite proactive in the matter of extending the coverage of social
security to eliminate the vulnerability of unorganized workers. In Life Insurance Corporation of
India v. Consumer Education and Research Centre 47, the court has observed that social security
has been assured under Article 41 and Article 47 and it imposes a positive duty on the State to
raise the standard of living and to improve public health. The basic right to enjoy means of
livelihood from cradle to crave India. The framers of the Indian Constitution incorporated some
specific provisions regarding labour welfare in Part III and IV of the Constitution dealing with
the Fundamental Rights and Directive Principles of State Policy respectively.

8.1. FUNDAMENTAL RIGHTS

1.1.3. ARTICLE 14

Article 14 of the Indian Constitution envisages the dual concept of equality i.e. equality before
law and equal protection of laws. Dr. Jennings puts it: “Equality before the law means that
among equals the law should be equal and should be equally administered. Thus, the rule is that
the like should be treated alike and not that unlike should be treated alike. In Randhir Singh v.
Union of India48, the Hon’ble Supreme Court has held that although the principle of 'equal pay
for equal work' is not expressly declared by our Constitution to be a fundamental right, but it is
certainly a constitutional goal under Articles 14, 16 and 39 (c) of the Constitution. This right can,

47
Life Insurance Corporation of India v. Consumer Education and Research Centre, 1995 SCC (5) 482.
48
Randhir Singh v. Union of India, AIR 1982 SC 879.

20 | P a g e
therefore, be enforced in cases of unequal scales of pay based on irrational classification. This
decision has been followed in a number of cases by the Supreme Court.

In DhirendraChamoli v. State of U.P49, it has been held that the principle of equal pay for equal
work is also applicable to casual workers employed on daily wage basis. Accordingly, it was
held that persons employed in Nehru Yuwak Kendra in the country as casual workers on daily
wage basis were doing the same work as done by Class IV employees appointed on regular basis
and, therefore, entitled to the same salary and conditions of service.

Denial of minimum pay amounts to exploitation of labour. The government cannot take
advantage of its dominant position. The government should be a model employer. In F.A.I.C.
and C.E.S. v. Union of India50,the Supreme Court has held that different pay scales can be fixed
for government servants holding same post and performing similar work on the basis of
difference in degree of responsibility, reliability and confidentiality, and as such it will not be
violative of the principle of equal pay for equal work, implicit in Article 14. The Court said that
equal pay must depend upon the nature of the work done. It cannot be judged by the mere
volume of work.

1.1.4. ARTICLE 19(1)(C)

This Article embodies the fundamental right of citizen to form associations and unions. It thus
includes the right to form companies, societies, partnership, trade union, and political parties.
The right guaranteed is not merely the right to form association but also to continue with the
association as such. In Damayanti v. Union of India51, the Hon’ble Supreme Court opined that
"the right to form an association necessarily 'implies that the person forming the association have
also the right to continue to be associated with only those whom they voluntarily admit in the
association. Any law by which members are introduced in the voluntary association without any
option being given to the members to keep them out, or any law which takes away the
membership of those who have voluntarily joined it, will be a law violating the right to form an
association". Furthermore, under clause (4) of Article 19, the State may by law impose

49
DhirendraChamoli v. State of U.P , AIR 1986 SC 172.
50
F.A.I.C. and C.E.S. v. Union of India, AIR 1988 SC 1291.
51
Damayanti v. Union of India, AIR 1971 SC 966.

21 | P a g e
reasonable restrictions on this right in the interest of public order or morality or the sovereignty
and integrity of India.

1.1.5. ARTICLE 21

The sweep of the right to life, conferred by Article 21 is wide and far reaching. In Maneka
Gandhi v. Union of India52 the Hon’ble Apex Court gave a new dimension to Article 21 and held
that the right to 'live' is not merely confined to physical existence but it includes within its ambit
the right to live with human dignity. Elaborating the same view the Court in Francis Coralie v.
53
Union Territory of Delhi said that the right to live is not restricted to mere animal existence. It
means something more than just physical survival. The right to 'live' is not confined to the
protection of any faculty or limb through which life is enjoyed or the soul communicates with the
outside world but it also includes "the right to live with human dignity", and all that goes along
with it, namely, the bare necessities of life such as, adequate nutrition, clothing and shelter.

In Olga Tellis v. Bombay Municipal Corporation 54 popularly known as the 'pavement dwellers
case' a five judge bench of the Hon’ble Supreme Court has finally ruled that the word 'life' in
Article 21 includes the 'right to livelihood' also. The similar view was taken again by the Apex
Court in D.K. Yadav v. J.M.A.Industries 55 wherein it was held that termination of the service of a
worker without giving him reasonable opportunity of hearing is unjust, arbitrary and illegal. The
procedure prescribed for depriving a person of livelihood must meet the challenge of Article 14
and so it must be just and fair and not arbitrary, fanciful or oppressive. In Salel Hydro Project v.
State of Jammu & Kashmir56, the Hon’ble Supreme Court while implementing the Minimum
Wages Act, observed that minimum wages to the workers employed by sub-contractors must be
paid directly and the provisions of Section 21 of Contract Labour (Regulation and Abolition)
Act, 1970 should be observed.

1.1.6. ARTICLE 23 & 24

Article 23 and 24 of the Constitution encapsulate the Right against Exploitation. Article 23
prohibits the traffic in human beings and forced labour such as beggar. In pursuance of these
52
Maneka Gandhi v. Union of India, AIR 1978 SC 597.
53
Francis Coralie v. Union Territory of Delhi, AIR 1981 SC 746.
54
Olga Tellis v. Bombay Municipal Corporation, AIR 1986 SC 180.
55
D.K. Yadav v. J.M.A. Industries, (1993) 3 SCC 258.
56
Salel Hydro Project v. State of Jammu & Kashmir, 1983 LLJ 494.

22 | P a g e
articles, the Parliament has enacted/passed the Suppression of Immoral Traffic in Women and
Girls Act, 1956 and The Bonded Labour System (Abolition) Act 1976 for punishing acts which
result in traffic in human beings and also the Employment of Children Act, 1938 which was
among the first acts to prevent child labour.

The Hon’ble Supreme Court in the seminal ruling in Peoples’ Union for Democratic Rights v.
Union of India57 (also known as Asiad Case) held that taking of labour or service of any person
for payment less than the prescribed minimum wages is violation of the fundamental right to
such labourer while exercising the scope and ambit of Article 23 of the Constitution of India.
The Apex Court after undertaking an elaborate discussion on the background of the Article held
that traffic in human beings and begar is a form of forced labour violative of human dignity and
contrary to basic human rights. The court held that when someone works for less than minimum
wages the presumption is that he is working under some compulsion which may result from
physical force or of legal provisions or of want, hunger and poverty.

Relying on the decision in Asiad workers case, the Court in Sanjit Roy v. State of Rajasthan 58
invalidated the Rajasthan Famine Relief Works Employees Act, 1964 which exempted the
application of the minimum wages Act 1948 in famine relief works as violative of Article 23 of
the Constitution of India by holding that whenever, any labour or service is taken by the state
from any person who is affected by drought and scarcity condition, the state cannot cannot take
advantage of their helplessness and pay him less wages than the minimum wages on the ground
that it is given to them to meet famine situation. Similarly, in Deena v. Union of India59 it was
held that labour taken from prisoners without paying proper remuneration was “forced labour”
and violative of Article 23 of the Constitution. The prisoners are entitled to payment of
reasonable wages for the work taken from them and the Court is under duty to enforce their
claim.

The Hon’ble Supreme Court in Bandhua Mukti Morcha v. Union of India,60 declared bonded
labour as the crude form of forced labour and held that such forced labour falls foul of Article 23
of the Constitution. It was further held that it is the constitutional obligation of the state to ensure
57
Peoples’ Union for Democratic Rights v. Union of India, AIR 1982 SC 1473.
58
Sanjit Roy v. State of Rajasthan, AIR 1983 SC 328.
59
Deena v. Union of India, AIR 1983 SC 1155.
60
BandhuaMuktiMorcha v. Union of India, AIR 1984 SC 802.

23 | P a g e
that there is no violation of the fundamental right of any person, particularly when he belongs to
the weaker sections of the community and is unable to wage a battle against a strong and
powerful opponent who is exploiting him. While commenting upon the deplorable condition of
bonded labourer, the Hon’ble Apex Court opined that bonded labourers as the “non-beings” are
living a life worse than that of animals who are atleast free from to roam about as they want. In
Neeraja Chaudhary v. State of Madya Pradesh61, the Hon’ble Apex Court went a step further and
opined failure on the part of the State to identify the bonded labourer, to release them of their
bondage and to rehabilitate them as envisaged by Bonded Labour System (Abolition) Act 1976
violates Article 21 and 23.

As regards employment of children in hazardous area, Hon’ble Justice P.N. Bhagwati in

Labourers Working on Salal Hydro Project v. State of Jammu and Kashmir and others 62
observed that construction work is a hazardous employment and therefore in view of Article 24
of the Constitution, no child below the age of 14 years can be employed in construction works.

8.2. DIRECTIVE PRINCIPLES OF STATE POLICY

Coming to the Directive Principles of State Policy enumerated in Part IV of the Constitution,
Article 38 reflects the intent of the State to work towards an egalitarian society where there is
equal opportunity for all citizens and social justice prevails. In this respect Article 39, 41, 42, 43
and 43-A are considered to be the ‘magna carta’ of industrial jurisprudence in the Indian context.

Article 39 reinforces the idea of working towards social equality and also enumerates several
principles that are sought to be enforced by way of statutes. For instance, Article 39(a)
recognises that all citizens have the right to an adequate means of livelihood, which corresponds
to the idea of protecting the basic dignity of individuals that has been read under Article 21 as
well. Article 39(e) also emphasizes the need to ensure that the health and strength of workers is
not adversely affected and that they are not forced to enter unsuitable occupations. In Consumer
Education and Research Centre and others v. Union of India and others 63 the Hon’ble Apex
court has held that the right to health and medical care to protect one’shealthand vitality, while in
service or post-retirement, is a fundamental right of a worker under Article 21 18 read with
61
Neeraja Chaudhary V. State of Madya Pradesh, AIR 1984 SC 1099.
62
Labourers Working on Salal Hydro Project v. State of Jammu and Kashmir and others, AIR 1984 SC 177.
63
Consumer Education and Research Centre and others v. Union of India and others, (1995) 3 SCC 42.

24 | P a g e
Articles 39(e), 41, 43 to make the life of the workman meaningful and purposeful with dignity of
person. The Hon’ble Court held that the compelling necessity to work in an industry exposed to
health hazards due to indigence to bread-winning for him and his dependents should not be at the
cost of health and vigour of the workman. This is read in conjunction with Article 42 which lies
down that the State shall make provision for securing just and humane conditions of work.

In P. Shivaswamy v. State of Andhra Pradesh64, it was held that Rs.738/- paid per family as
financial assistance to the repatriated bonded labourers, set free from bonds, were inadequate and
not in conformity with Article 42 which required the state to make provisions for just and human
conditions of work. Article 42 also enumerates the State’s obligation to make provision for
Maternity Relief. The same is done by way of the Maternity Benefit Act, 1961 and the
Employee’s State Insurance Act, 1948 for factories coming under the latter legislation.

Likewise, Article 43 imposes an obligation towards ensuring the provision of a ‘living wage’ in
all sectors as well as acceptable conditions of work. Living wage mean 'wage which enables a
workmen to provide his family with all- material things, which are needed for their health and
physical well-being, enough to enable him to qualify and discharge his duties as a citizen. 65
Furthermore, Article 43-A which was introduced by the 42nd Amendment in 1976, obligates the
State to take steps by suitable legislation or any other means to secure the participation of
workers in the management of industrial establishments.

The other principles enumerated in Part IV which have a bearing on Labour Laws are Article 45
that talks about the obligation to provide free and compulsory education for the promotion of
educational and economic interests of weaker sections and Article 47 that emphasizes the need
for improvement in the level of the standard of living and of public health.

64
P. Shivaswamy v. State of Andhra Pradesh, AIR 1988 SC 1863.
65
Express Newspaper (P)-Ltd. v. Union of India AIR 1958 SC 578 at 600.

25 | P a g e
 Bibliography

Books
S. N. Mishra, LABOUR & INDUSTRIAL LAWS, Central Law Publications (28th edn
2018)

V. G. Goswami, LABOUR INDUSTRIAL LAWS, Central Law Agency (2015)

Meenu Paul, LABOUR AND INDUSTRIAL LAWS, Allahabad Law Agency (2018)

Websites
http://www.legalservicesindia.com

http://www.manupatra.com

http://www.shareyouressays.com

http://www.supremecourtcases.com

https://www.lexisnexis.com/in/legal 

26 | P a g e