ROLE OF STATE IN MAKING LABOUR LEGISLATIONS: AN

ANALYTICAL STUDY

8.3 Labour Laws - II

SUBMITTED BY:
Ritik Shalya
UG18-74
SEMESTER VIII YEAR IV

SUBMITTED TO:

Mr. Jagdish Khobragade (Assistant Professor of Law)

MAHARASHTRA NATIONAL LAW UNIVERSITY, NAGPUR

Table of Contents
Introduction................................................................................................................................1

Research Methodology...............................................................................................................2

Research Design.....................................................................................................................2

Aims and Objectives...............................................................................................................3

The Evolution of Labour Law in India......................................................................................3

Post-Independence, 1948 Onwards........................................................................................4

Constitutional Bearing on Industrial Laws and Industrial Relations.........................................5

Social justice and Industrial Laws..............................................................................................7

Role of State in Making Labour Laws.......................................................................................8

Constitutional Remedies..........................................................................................................10

Labour Laws with reference to Directive Principles and State Policy.....................................10

Conclusion................................................................................................................................11

Bibliography.............................................................................................................................11
Introduction
The fundamental principle of labour legislation is to guarantee the weaker party in the labour
market protection and basic rights in order to be in a fair position when negotiating salary and
working conditions. That fact was recalled in 2006 by Marcello Malentacchi, General
Secretary of the International Metalworkers Federation (IMF). The reminder was addressed
to the government of a member State of the International Labour Organization. In recent
years, the government concerned has gained something of a reputation for legislating to
dismantle the industrial relations system and weaken trade union rights – among other things,
by promoting individual employment contracts, to the detriment of collective agreements
negotiated between trade unions and employers. This disdain for the basic principles of
labour law has already come in for serious criticism from the ILO supervisory bodies. The
dossier is now being examined by the Committee on Freedom of Association, and further
developments are likely.

It is certainly a good illustration of the ambivalent interpretations of labour law which still
lurk in some minds, and of a dangerous return to times which should have been past and
gone. In his contribution to this issue of Labour Education, Daniel Blackburn recalls that,
historically, the first labour laws (notably the much-bruited Ordinance of Labourers Act of
1349 in England) were mainly aimed at imposing discipline on workers, penalizing any
protest movements, and ensuring obedience and loyalty to employers. Often, any breach of
contract led to court-ordered forced labour.

This issue of Labour Education, to which eminent lawyers have contributed, does not really
set out to relate the history of labour law, but rather to stimulate some reflection on its
possible role in the globalized world of today. At the same time, we report some
developments which suggest that labour law has been drifting away from its basic principle
of protecting the weaker party within an unequal contractual relationship.

Research Methodology
The research meth0d s0 used t0 write this research w0rk is d0ctrinal. D0ctrinal in the sense as
it c0mes fr0m the credible s0urces herein, the s0urces like the articles published in ren0wned
and justified web pages and j0urnal. The pr0ject als0 uses explanat0ry reas0ning f0r research.
The s0urce 0f inf0rmati0n als0 c0nsists 0f the the0retical kn0wledge the researcher p0ssess
as a student 0f law.

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The research is directed t0wards the Role of State in making Labour Legislation in India. The
data s0 used is qualitative, as in the f0rm 0f established the0ry and criticism. The data is
extracted fr0m J0urnals, articles and websites. The s0urces s0 used are sec0ndary in nature.

Research Design

For this research, the researcher has adopted the doctrinal or non-empirical method as this
method uses the secondary sources of data already existing on the concerned topic. An
empirical method of research is more credible but the same was not possible for the
paucity of time and expertise. The researcher has firstly relied on the judgements of
various Courts and secondly upon secondary sources that include reading of data from
books, articles and journals. For fair research, the researcher has tried to read this data after
eliminating all the biases and prejudices pertaining to any of these topics as failure in
doing so can lead to fallacious research and consequentially a flawed paper.
Secondly, the researcher has used an amalgam of the descriptive and analytical approaches to
come up with the paper. The combination is used in all the three parts of the paper where
sound conclusions are reached after duly studying and analysing the existing facts and
statistics.

Aims and Objectives

Before initiating any research, a researcher has to set forth certain goals that need to be met
with when the research concludes. This research was no exception and the researcher had
certain aims and objectives before conducting the same. The aims and objectives of this
research were:

 To know about the evolution of Law Laws in India.

 To analyze the role of State in making labour laws.

 To know about the remedies if a law is violated.

Research Questions

Q.1 How labour laws evolved in India?

Q.2 What role does a state play in making labour laws?

Q.3 How industrial laws bring social justice to the society?

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The Evolution of Labour Law in India
Discussion of Indian labour law and industrial relations is often divided into discrete time
periods, reflecting important stages in the evolution of the Indian state as well as stages of
economic development and policy. Writing in 1955, Ornati suggested three key periods in the
evolution of Indian labour law to that point of time. 1 The earliest regulation was largely
aimed towards securing labour supply and control, including Indian versions of the Masters
and Servants provisions of English law,2 but these were eventually added to by a sequence of
factory-type regulations, providing for some basic levels of protection, between the 1880s
and the 1930s. This legislation essentially reflected an accommodation of sorts between the
interests of British industry, seeking protection for its domestic enterprises against cheap
foreign labour, and Indian social reformers intent on improving what were regarded as
subhuman working conditions in Indian factories. 3 1 In the view of some commentators, this
early period of labour law reform was largely “formal or unimportant,” constituting only a
“minimum of interference with the working conditions of labour and the relationship between
the employer and the worker.”4

Post-Independence, 1948 Onwards

In the immediate post-war period it was agreed that the Indian central government would be
primarily responsible for labour legislation, and the promotion of labour’s interests, reflecting
a five-year plan of development “dealing with all phases of the worker’s life, of housing,
welfare, work, better working conditions, and fair wages.” Many of these social values were
articulated in the Constitution of India 1950, particularly its commitment to economic,
political, and social justice in the Preamble, and its general egalitarian conception of national
development.5

1
Ornati (1955), pp. 81–95.
2
For example, The Workmen’s Breach of Contract Act 1859; The Employers and Workmen’s Act 1860; and
The Indian Penal Code 1860. For discussion, see Anderson (2004) and Anderson (1993).
3
Candland (2007), pp. 18–20; DeSousa, supra note 6, pp. 65–74.
4
Menon (1956), p. 555. Ornati himself suggests that the earlier period reforms were “conservative and narrow”
when contrasted with the labour law developments of later periods: Ornati, supra note 9, p. 89.
5
The Indian Constitution 1950 contains specific goals relating to labour, including the “right to work,” “just and
humane conditions of work,” a “living wage,” and a “decent standard of life,” in addition to the right to form
trade unions: see Constitution of India 1949 ss. 14, 15, 19, 39, 41, 43, and 43A in particular. For further
discussion see Saini, supra note 4, pp. xvii–xx; and Gopalakrishnan (2010). More radical earlier suggestions
resulting from a National Planning Committee of the Indian National Congress in 1939, and from the Industrial
Truce Conference convened shortly after Independence in 1947, had offered the possibility of far-reaching
concessions to labour, including worker “voice,” fair wages, profit sharing, and taxes on excess profits.
However, these commitments were not followed through in political terms.

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Consistent with this socio/political outlook, we have noted the introduction of a raft of
protective legislation in the form of the Factories Act 1948, and the Minimum Wages Act
1948. Important also to note are the Dock Workers (Regulation of Employment) Act 1948,
which among other things sought to “decasualize” dock labour, the Employees’ State
Insurance Act 1948, providing for an insurance system for employees in cases of sickness,
maternity, injury, and death, the Plantations Labour Act 1951, which sought to regulate
conditions of work and provide welfare measures for India’s high-employment industries in
tea and rubber plantations, and the Employees’ Provident Fund and Miscellaneous Provisions
Act 1952, one of the most important pieces of legislation in India’s social security system.

It follows from what we have said earlier, however, that this period did not mark out a
completely new approach to the issue of labour regulation in India. When it came to the
regulation of collective labour relations in particular, the restrictive policies of government
control which had characterized the colonial and immediate post-war period continued to
hold sway. As various authorities have noted, the major influence on the formation of post
independence labour and economic policy was the priority given to government-directed
“nation-building”—in which the need for trade union co-operation in securing industrial
peace and labour support for industrialization and economic development (economic
nationalism) was paramount.

Constitutional Bearing on Industrial Laws and Industrial Relations

Industrial relations affect not merely the interest of labour and management, but also the
social and economic goals to which the State is committed to materialise. Therefore, it
develops within the province and function of the State to regulate these relations in society
desirable channels. The extent of state control or intervention is determined by the stage of
economic development. In developed economy, work stoppages to settle claim may not have
much impact, unlike in developing economy. Countries like the U.S. and England, etc. with
advanced and free market economy only lay down bare rules for observance of employers
and workers giving them freedom to settle their disputes. In the U.S., States intervention in
industrial dispute is eliminated to actual or threatened workers’ stoppages that may imperil
the national economy, health or safety. However, in developing economy, the States rules
cover a wider area of relationship and there is equally greater supervision over the
enforcement of these rules. This is emphatically so in developing countries with labour

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surplus. It is a concern of the state to achieve a reasonable growth rate in the economy and to
ensure the equitable distribution thereof. This process becomes more complex in a country
with democratic framework guaranteeing fundamental individual freedoms to its citizens.
Hence, the a state in a developing country concerns itself not only with the content of work
rules but also with the framing of rules relating to industrial discipline, training, employment
and so on. The founding fathers of democratic Constitution of India were fully aware about
these implications while they laid emphasis to evolve a welfare state embodying federal
arrangement. Entries about labour relations are represented in all the three lists in the
Constitution. Yet most important ones come under the Concurrent list. These are industrial
and labour disputes, trade unions and many aspect of social securities and welfare like
employer’s’ liability, employees’ compensation, provident fund, old age pensions, maternity
benefit, etc. Thus, the Industrial Disputes Act, 1947, the Minimum Wages Act, 1948, the
Employees’ State Insurance Act, 1948, etc. come under the concurrent list. Some States have
enacted separate amendment Acts to some of the above legislations to meet local needs. Such
amendments are recommended either with the assent of the President of India or by
promulgating rules pursuant to the powers delegated by the Central Act. Under the rule
making powers delegated by the Centre, the States have often been able to adopt Central Act
to local needs without the President’s assent. The Central acts often delegate such powers.
For example, Section 38 of the Industrial Disputes Act delegates to the appropriate
government, which in many is the State Government, the power to promulgate such rules as
may be needed for making the Act effective. Similarly, Section 29 and Section 30 of the
Minimum Wages Act and Section 26 of the Payment of Wages Act delegated the rule making
power to the State. In pursuance to this, several States have promulgated separate minimum
wages rules and payment of wage rules. The Factories Act also contains similar provisions
and they have been similarly availed of.

Further, the goals and values to be secured by labour legislation and workmen have been
made clear in Part IV, Directive Principles of the State Policy of the Constitution. Thus, the
State shall secure a social order for the promotion of welfare of the people and certain
principles of policy should be followed by the State towards securing right to adequate means
of livelihood, distribution of the material resources of the community to subserve the
common good, prevention of concentration of wealth via the economic system, equal pay for
equal work for both men and women, health and strength of workers including men, women
and children are not abused, participation of workers in management of industries, just and

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humane conditions of work and that childhood and youth are protected against exploitation
against exploitation and against moral and material abandonment.

By and large industrial and labour legislations have been directed towards the implementation
of these directives. Factories Act, 1948, ESI Act, 1948, Employees’ Compensation Act, 1923
are focused to the regulation of the employment of the women and children in factories, just
and humane conditions of work, protection of health and compensation for injuries sustained
during work. Minimum Wages Act, 1948 and the Payment of Wages Act, 1936 regulate wage
payment. Payment of Bonus Act, 1965 seeks to bridge the gap between the minimum wage
and the living wage. However, the directives relating to distribution of wealth, living wages,
equal pay for equal work, public assistance, etc. have not been generally implemented as yet.

List of Labour laws enactments are as under:

 The Employees’ Compensation Act, 1923

 The Trade Unions Act, 1926
 The Payment of Wages Act, 1936
 The Industrial Employment (Standing Orders) Act, 1946
 The Industrial Disputes Act, 1947
 The Minimum Wages Act, 1948
 The Employees’ State Insurance Act, 1948
 The Factories Act, 1948
 The Plantation Labour Act, 1951
 The Mines Act, 1952
 The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952
 The Working Journalists and Other Newspapers Employees (Conditions of Service)
and Miscellaneous Provisions Act, 1955

Social justice and Industrial Laws

The Preamble of the Constitution highlights the concept of socio-economic justice, being the
main objectives of the State required by the Constitution. Article 38 of the Constitution
provides the concept of social justice by providing that the State shall strive to promote the
welfare of the people by securing and protecting, as effectively as it may, social order in

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which justice, social, economic and political shall inform all institutions of the national life.
Further, Article 39 says that it shall be the duty of the state to apply certain principles of
social justice in making laws.

“The concept social and economic justice is a living concept of revolutionary import, it gives
sustenance to the rule of law, meaning and significance to the ideal of the welfare state.”
(Justice Gajendragadkar in the State of Mysore v. Workers of Gold Mines 6). In the economic
sphere, social justice means opportunities in greater measure to the poor and the needy for the
betterment of their social and economic conditions. “It does not mean making rich man poor
in order to make poor men rich. It does not mean that all wealth should be shared equally
provision of basic minimum to all in response to life and living facilities for promoting one’s
own values and manner worth are the essential contents of social justice.”. 7 It is the
responsibility of both the State and the citizens to work hand in hand for achieving social
justice. “The State has constitutional responsibilities and the citizens have moral
responsibility and the combination of the two types of responsibilities tend to create an ideal
society worthy to live in”.8

Role of State in Making Labour Laws

The labour laws falls in the ambit of concurrent list of the Constitution. It means that both
state and centre have the power to make laws regarding this. As we all know that if there is a
conflict between the laws between the centre and the state, the law of centre will prevail but
that does not mean that the state cannot make laws for the benefit of the labour. The state
must keep the law of the centre in mind before making any provision.

The goals and values proclaimed under Part IV of the Constitution are to be effectuated
consistent with the fundamental rights enshrined in Part III of the Constitution. The socio-
economic reconstruction should not give scope to eat away the existence and worth of man.
The fundamental rights are envisaged with the overall object of protecting individual liberty
and democratic principles based on equality of all members of society. The State in its
ebullience to evolve and streamline socio-economic reforms is bound to respect the dignity
and worth of the citizens. Without these fundamental rights, the values of life may be stifled
and annihilated. Therefore, the State cannot make laws inconsistent with the fundamental
rights. Any law that contravenes fundamental rights will be void to the extent of

6
AIR 1958 SC 923
7
K.N. Bhattacharya, Indian Plans, A Generalist Approach, (1963) p. 97.
8
Chakradhar Jha, ‘Judicial Review of Legislative Acts’ (1974), p. 254.

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inconsistency. Article 32 and 226 provide for remedy to enforce the fundamental rights
through Supreme Court and High Courts respectively. Hence, the legislative competence of
the law making bodies is delimited by these fundamental provisions.

Article 14 requires the State not to deny to any person equality before law or the equal
protection of the laws. Thus, discriminatory laws or unequal laws are not to be passed to
equal or uniform laws are not to be passed to unequal. In the Industrial legislative sphere this
protection extends to both the labour and the capital. The freedom of speech and expression,
freedom of assembly, right to form associations and unions, guaranteed under Article 19(1)
(a), (b) and (c) and the prohibition against forced labour and child labour protect some of the
vital interests of the workers strengthening their hands in forming trade unions, in staging
demonstrations and in carrying on collective bargaining. 9 The freedom of trade and
occupation guaranteed in Article (19)(1)(g) primarily goes to the benefit of the employer.

What if a law enacted to enforce a directive principle infringes a Fundamental Right? On this
question, the judicial view has veered round from irreconcilability to integration between the
Fundamental Rights and Directive Principles and, in some of the more recent cases, to giving
primacy to the Directive Principles.

The Fundamental Rights are not an end in themselves but are the means to an end. The end is
specified in Directive Principles. On the other hand, the goals set out in Directive Principles
are to be achieved without abrogating the Fundamental Rights. It is in this sense that
Fundamental Rights and Directive Principles together constitute the core of our Constitution
and combine to form its conscience. Anything that destroys the balance between the two parts
will ipso facto destroy an essential element of the basic structure of our Constitution.10

Thus, the integrative approach towards Fundamental Rights and Directive Principles, or that
the both should be interpreted and read together, has now come to hold the field. It has now
become a judicial strategy to read Fundamental Rights along with Directive Principles with a
view to define the scope and the ambit of the former. Mostly, Directive Principles have been
used to broaden, and to give depth to some Fundamental Rights and to imply some more
rights therefrom for the people over and above what are expressly stated in the Fundamental
Rights.

9
Indian Law Institute, ‘Labour Law and Labour Relations’ (1968) p. 82.
10
Minerva Mills v. Union of India, AIR 1980 SC 1789.

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Within the limits above stated and consistent with the distribution of legislative powers,
Parliament and State legislatures make laws to regulate industrial relations and connected
matters. The social security legislations, legislations to provide for retirement benefits,
against industrial injuries, child labour, etc. are only resonating with the concept of social
justice as highlighted by International Labour Organisations., since its inception in 1919. This
has definitely shaped the industrial relations and labour laws of this country

Constitutional Remedies
The Constitution also envisages remedy by Supreme Court under Article 32 against violation
of fundamental rights against injuries and illegalities etc. Article 32 is itself a fundamental
right. Apart from the writ jurisdiction under Article 32, the Supreme Court is envisaged with
discretionary jurisdiction to entertain appeal by special leave under Article 136 from decree,
sentence, or order passed by any court or tribunal in India. Similarly, High Courts are given
writ jurisdiction under Article 226 and the power of superintendence over all courts and
tribunals under Article 227. A person aggrieved by an award of the High Court can appeal to
the Supreme Court under Article 132 if any constitutional question is involved or under
Article 133 in civil appeal.

Can a Trade Union move the High Court under Article 226 to redress the fundamental rights
of its members?. This issue was discussed by the Rajasthan High Court in Jaipur Division
Irrigation Employees Union v. State of Rajasthan and Ors. 11 Here a large number of the
employees of the irrigation department were declared surplus. The Union challenged it in this
writ petition. The Single Bench held that the petition is not maintainable holding that the
fundamental rights of the individual are not the rights of the union. On appeal, the Division
Bench reversed it and sent back to the Single Bench for disposal of the writ petition in
accordance with the merits of the case. The traditional concept of locus standi underwent
sweeping changes in the modern age of public action and public interest litigation. 12

Labour Laws with reference to Directive Principles and State Policy

The makers of the Constitution had realized that in a poor country like India, political
democracy would be useless without economic democracy. Accordingly, they incorporated a
few provisions in the Constitution with a view to achieve amelioration of the socio-economic
condition of the masses. Today we are living in an era of welfare state which seeks to

11
(1994) IILLJ 26 Raj, 1994 (1) WLC 240.
12
S.P. Gupta and others v. President of India and others, AIR 1982 SC 149.

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promote the prosperity and well-being of the people. The Directive Principles strengthen and
promote this concept by seeking to lay down some socio-economic goals which the various
governments in India have to strive to achieve. The Directive Principles are designed to usher
in a social and economic democracy in the country. These principles obligate the state to take
positive action in certain directions in order to promote the welfare of the people and achieve
economic democracy. These principles give directions to the legislatures and the executive in
India as regards the manner in which they should exercise their power.

The Courts however do not enforce a directive principle enshrined in Part IV of the
Constitution unlike rights enshrined in Part III. The reason behind the legal non-
enforceability and non-justiciability of these principles is that they impose positive
obligations on the state. While taking positive action, government functions under several
restraints, the most crucial of these being that of financial resources. The constitution-makers,
therefore, taking a pragmatic view refrained from giving teeth to these principles. They
believed more in an awakened public opinion, rather than in Court proceedings, as the
ultimate sanction for the fulfilment of these principles. Nevertheless, the Constitution
declares that the Directive Principles, though not enforceable by any Court, are ‘fundamental’
in the governance of the country, and the ‘state’ has been placed under an obligation to apply
them in making laws. The state has thus to make laws and use its administrative machinery
for the achievement of these Directive Principles.

Articles 38, 39, 41, 42 and 43 have a special relevance in the field of industrial legislation and
adjudication. In fact, they are the substratum or rather ‘magna carta’ of industrial
jurisprudence. They encompass the responsibility of the Government, both Central and State,
towards the labour to secure for them social order and living wages, keeping with the
economic and political conditions of the country.

Conclusion
India’s constitution is the basis of all laws in our country. The labour laws are also rendered
in compliance with the constitution, and the abolition of that particular law results in any
violation of constitutional law. The Directive Principles of State policy play a major role in
the development of new labour laws in India. The Central Government’s role in the
implementation of the labour laws is pivotal. As per the report of the Ministry of the Labour
and Employment, the year 2019 saw a 63% decrease in the number of man-days lost due to
various disputes between the workers and the Government as compared to the year of 2018.

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Such an improvement is commendable, and it shows that requirements of the labourers can
be achieved only when the labour laws or the employment laws are formulated for the
workers and not for the interest of the particular section.

Bibliography
Books
 P.L. Malik : Industrial Law; Eastern Book Company; 34, Lalbagh, Lucknow
 N.D. Kapoor : Handbook of Industrial Law; Sultan Chand & Sons, 23, Darya Ganj,
New Delhi – 110002
 S.S. Gulshan & : Economic, Labour and Industrial Laws; Sultan Chand & Sons, 23,
G.K. Kapoor Daryaganj, New Delhi- 2.

Websites

 https://lexforti.com/legal-news/role-of-central-government-in-implementing-labour-
laws/#:~:text=Under%20the%20Indian%20Constitution%2C%20the,make%20any
%20law%20on%20labour.
 https://www.jstor.org/stable/825887?read-now=1&seq=6.
 https://prsindia.org/billtrack/overview-of-labour-law-reforms.
 https://www.epw.in/engage/article/changes-labour-laws-state-market-anarchy-labour-
market.

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