Parliament recently promulgated the Occupational Safety, Health and Working Conditions Code, 2020 (OSH Code) which received the assent of the President on 28 September 2020. The OSH Code will come into effect on a date notified by the Central Government in the Official Gazette. This marks the fourth of the four labour codes which the Government announced last year. The first being the Code on Wages was passed in 2019, while the second and third being the Industrial Relations Code and Code on Social Security were passed in 2020. More detailed analysis of the Code on Wages, 2019, the Industrial Relations Code and the Code on Social Security can be found here , here and here .

The OSH Code proposes to subsume 633 provisions of 13 major labour laws into one single code with 143 provisions. The laws to be subsumed are:

(1) The Factories Act, 1948

(2) The Contract Labour (Regulation and Abolition) Act, 1970

(3) The Mines Act, 1952

(4) The Dock Workers (Safety, Health and Welfare) Act, 1986

(5) The Building & Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996

(6) The Plantations Labour Act, 1951

(7) The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979

(8) The Working Journalist and other Newspaper Employees (Conditions of Service and Miscellaneous Provision) Act, 1955

(9) The Working Journalist (Fixation of rates of wages) Act, 1958

(10) The Cine Workers and Cinema Theatre Workers Act, 1981

(11) The Motor Transport Workers Act, 1961

(12) The Sales Promotion Employees (Conditions of Service) Act, 1976

(13) The Beedi and Cigar Workers (Conditions of Employment) Act, 1966
 

Salient features of the OSH Code::

• Duties and Rights of Employers and Employees:
  
  (i) Duties of employer include ensuring that the workplace is free from hazards, comply with occupational safety and health standards, providing annual health examination, compulsory reporting of diseases and accidents etc.
  
  (ii) Duties of employees include taking reasonable care for the health and safety of himself and co-operate with the employer in meeting the statutory obligations.
  
  (iii) Designers, manufacturers, importers and suppliers of any article used in an establishment are duty bound to ensure such article is safe and does not probe any risk to health of workers.
  
  (iv) Architects, project engineers and designers responsible for any construction work or design of the project must ensure safety and health aspects of the building workers and employees at the planning stage.
   
• Working Conditions: The employer is required to provide and maintain welfare activities for employees including sanitation facilities to male and female employees separately, sitting arrangements, first-aid boxes, etc. The Central Government has been conferred the right to make rules in this regard. The employer is also entitled to make provisions for cleanliness and hygiene, ventilation, temperature and humidity, potable drinking water, lighting, adequate standards to prevent overcrowding, etc.
   
• Contract Labour and Inter-State Migrant Workers:
  
  (i) The OSH Code has modified the number of minimum contract labour to fifty (50) from twenty (20) for the OSH Code to apply. It has further been clarified that no contractor is permitted to engage any contract labour if they does not procure a license under the OSH Code.
  
  (ii) The contractors are obliged to extend all benefits as are available to a worker under the various labour laws to inter-state migrant workers as well. They are also required to pay to such workers a lump sum fare for to and fro journey to their native place.
   
• Authorities: For effective implementation of the OSH Code, appointment of Inspector-cum-Facilitators has been prescribed. Additionally, National and State Occupational Safety and Health Advisory Boards will be constituted to advise and assist the Government on matters relating to occupational safety and health.
   
• Offences and Penalties:
  
  (i) Obstructing discharge of duties of Inspector, imprisonment upto 3 months andfine upto INR 1 lakh.
  
  (ii) An offence that leads to the death of an employee will be punishable with imprisonment of up to two years, or fine up to INR 5 lakhs, or both.
  
  (iii) Where penalty is not specified, the employer will be punished with a fine between INR 2 - 3 lakhs.
  
  (iv) If an employee violates provisions of the OSH Code, fine upto Rs 10,000 may be levied.
  
  (v) Offences committed by a company shall hold each person liable who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company.
   
• Social Security Fund: For the welfare of unorganized workers, a social security fund will be set up and will be credited with the amount received from composition of certain offences.

MHCO Comment: The OSH Code is expected to bring a major reform in terms of health and safety and welfare of workers employed. On the other hand it is also going to lessen the burden of employers by replacing multiple registrations and licenses into one common licence. The OSH Code aims to empower both employees and employers. On one side it allows flexibility in hiring and retrenchment, while on the other side it will expand the social security net for both formal and informal workers.

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Author: Bhushan Shah - Partner

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This update was released on 13 Jan 2021.

The views expressed in this update are personal and should not be construed as any legal advice. Please contact us directly on +91 22 40565252 or legalupdates@mhcolaw.com for any assistance.

Legal Update Team
MANSUKHLAL HIRALAL & COMPANY
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