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Labour Law Compliance in India – Labour Act

Do you want to employ labour for your business but don’t have sufficient knowledge about labour law compliance in India? This info-filled guide will help you by providing important information. Learn everything about labour law compliance in India – Labour Act.

Labour laws are a collection of regulations that set the standard regarding the treatment of workers at work. Workers are the most valuable resource for an organisation. The laws on labour are implemented to ensure that their rights are safeguarded and to protect them from exploitation. They regulate businesses, workers, trade unions, and employees. Failure to comply with the law can be punished against the organisation.The State and Central Government enforce Labour Laws. Labour Law Compliance is not only restricted to filing return forms. However, these records serve as proof of compliance with the laws.Also, you must present them to authorities in case of any doubts. Some laws can be enforced only in certain workplaces. Additionally, some laws apply to all organisations.

Relevance and Necessity of Labour Law

  • Potential workers are protected from the exploitation of their employers or management
  • Improves relations between industrial parties, i.e. employer-employee relations, and reduces disputes
  • Minimises labour unrest
  • Helps workers in getting fair wages
  • Assures work security for workers
  • Offers compensation to employees who have been injured in accidents
  • Reduces conflict and strikes
  • Corrections for rest pauses, work hours etc.
  • Encourages welcoming environment conditions within the industrial system

The Importance of Ensuring Compliance With Labour Laws

The companies operating in India are necessary to implement legal compliance requirements in India according to different Labour Laws. The scope of compliance for labour does not limit to filing tax returns or maintaining documents and deposits necessary by law through the companies. The records must be presented as evidence by various statutes for any legal proceedings. In addition, if the company or business does not meet the requirements of compliance with the law of industrial production, there are major sanctions imposed by the law.Indian Labour Law has several statutes that encompass every element to safeguard rights to work. The law’s application is dependent on the type of company. Numerous laws apply to employees and employers.

What Are the Labour Law Compliances?

Labour Law Compliances refer to the legally binding regulations and rules companies must follow. Compliance with the law is an arrangement of guidelines and rules for employees. Labour law Compliance includes

  • The benefits plus the option of terminating an employee
  • Regulations and guidelines apply to workers.
  • ContractThe following are the different laws that come with Labour Compliance rules: 
  • Labour (Regulation and Abolition) Act, 1970
  • Equal Remuneration Act of 1976
  • Minimum Wages Act of 1948 as well as Mines Act, 1952
  • Industrial Employment (Standing Order) Act 1946, etc.
  • Building and Other Construction Workers Act of 1996

The Basic Concepts of Labour Law

Labour Law involves employee advantages, termination, laws and rules applicable to workers, and so on. Also, there are a variety of laws that are part of compliance with the laws of labour. The main acts comprised in the law of the industry compliance rule include:

  • Minimum Wages Act, 1948; Mines Act, 1952; Industrial Employment (Standing Order) Act, 1946, etc.
  • Contract Labour (Regulation and Abolition) Act, 1970, Equal Remuneration Act, 1976
  • Building and Other Workers in Construction Niche (Regulation of Conditions and Employment Services) Act in 1996

Act to regulate the employment and conditions of service for construction workers. An act that regulates the conditions of employment and service for construction workers and others and guarantees their health, safety, welfare, and various other issues related to or related to it.

1. Equal Remuneration Act, 1976

Contract Labour (Regulation and Abolition) Act, 1970, Equal Remuneration Act, 1976.In every place, at least twenty workers were employed during the previous twelve months in contract work.

2. Compliance under labour laws

We recommend that startups submit a self-declaration that they comply with the nine regulations on labour in the first year after the date of the beginning of the business. There would be no probe as per these laws in case they are applicable. These are the main labour laws to be considered:

  1. The Contract Labour (Regulation and Abolition) Act, 1970
  2. The International State Migrant Workmen(Regulation of Employment and Terms of Service) Act, 1979
  3. The Building and Other Constructions Workers’ (Regulation of Employment and Conditions of Service) Act, 1996
  4. The Payment of Gratuity Act, 1972
  5. The Employees State Insurance Act of 1948
  6. The Employees’ Provident Funds & Miscellaneous Provisions Act of 1952

Startups have to complete self-certification via the Startup mobile application that lets entrepreneurs fill out important forms and provide information on the application or submit it online. Also,  the returns from the second year and onwards after five years or more after the unit’s establishment are only subject to inspection under these two conditions:

  1. When a credible and valid complaint of infringement has been submitted in writing
  2. Written authorisation is obtained from the higher authorities

3. Industrial Employment (Standing Order) Act 1946

It includes the Minimum Wages Act, 1948; Mines Act, 1952; Industrial Employment (Standing Order) Act, 1946, etc. Also, the Minimum Wages Act 1948 is an Act of Parliament concerning Indian labour law. It establishes the minimum wage that you have to pay to unskilled and skilled labourers.

A Comprehensive List of Labour Laws in India

Labour Laws are classed as follows:

Laws Relating to Industrial Relations

  • Industrial Disputes Act, 1947
  • Industrial Employment Standing Order Act, 1946
  • The Trade Unions Act, 1926

Laws Relating to Empowerment and Equity of Women

  • Equal Remuneration Act, 1976
  • The Maternity Benefits Act of 1961

The Law That Governs Wages

  • The Payment of Wages Act, 1936
  • Minimum Wages Act, 1948
  • Journalists working for the Working Class (Fixation of wages) Act of 1958
  • Bonus Payment Act 1965

Laws About the Sections of the Disadvantaged and Deprived Society

  • Child Labor (Prohibition & Regulation) Act, 1986
  • Bonded Labour System (Abolition) Act in 1976
  • Children (Pledging of Labour) Act 1933


Compliance with the law of labour is necessary for all sectors and companies; however, it can be an area of concern for startups. Thus, with the sole goal of promoting and supporting companies, India’s government has devised the strategy of self-certifying nine labour and environmental regulations laws for three years. 

This will ensure that entrepreneurs with no prior experience face fewer hurdles and are aware of all labour law regulations. Also, the decision of the government to help entrepreneurs in India is wise. It will contribute to building the startup sector and lead to better employment opportunities.


CA Desk is a team of highly professional CA, CS, Lawyers who driving towards the integration of technology with traditional practices to cater to the need of MSMEs in the fast-moving and cost-effective world.

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