Industrial Employment (Standing Orders) Act

The Industrial Employment (Standing orders) Act, was introduced for the employers in industrial establishments to ensure the employment conditions under the establishments. Standing Orders states the laws which govern the relationship between the employer and a workman in an industrial establishment with includes the elements such as classification of workers, working hours, attendance, suspension, termination etc. In this article, we look at the various aspects of the Industrial Employment (Standing Orders) Act in detail.

Objective of the Act

The objective of the Industrial Employment (Standing Orders) Act, are as follows:

To provide regular standing orders for workers, factories, and working relationship.
To ensure that the employee recognises the terms and conditions of the employees and thus to minimise exploitation of the workers.
To promote industrial peace and harmony by supporting fair industrial practices.

Applicability of the Act

The Act applies to all industrial establishments involving 100 or more workers under Section 1(3). Under section 2(i) Industrial Establishment are the following entities are listed below:

An industrial establishment as specified in section 2(i) of Payment of Wages Act.
Factory as explained in section 2(m) of Factories Act.
Railway Industry
Establishment of contractor who employs workers for fulfilling the contract with the owner of an industrial establishment under section 2(e).
Workman as specified under section 2(s) of Industrial Disputes Act. Under Section 2(i) workman covers skilled, unskilled, manual or clerical work. However, workman does not include employees engaged in a managerial or administrative capacity or supervisory capacity and also it does not include workers subject to Army Act, Navy Act or Air Force Act or police or prison services.

Certification of Standing Orders

It is mandatory for every employer covered under the Industrial Employment (Standing Orders) Act has to get standing orders certified by submitting five draft copies of the standing orders to the certifying officer such as labour commissioner or a regional labour commissioner and also includes any other officer appointed to perform the functions of certifying officer.

Details Enclosed in Standing Orders

The particular information which is generally provided in the standing orders include:

Workmen classification into categories such as permanent, temporary, on probation, etc.
Method of informing the workmen about working hours, holidays, etc.
Shift working.
Temporary stoppages of work.
Provisions concerning the termination of employment and the notice period.
Actions/inactions which are treated as misconduct and the consequences for the fault.
Grievance redressal mechanism in case of unjust or unfair treatment by the employer.
Attendance marking system for workers.
Employment termination and the notice thereof to be provided by both employer and the workers.
Procedure for availing leave and encashment, accumulation of leaves.
Workmen records and information, etc.

Modification of Standing Order

Standing orders finally certified by the certifying officer is not liable to change, except by an agreement between the employer and workers to the contrary, until the expiry of six months from the date on which the standing orders or the last modification came into operation. An employer or workers or a trade union or other representative body of the workman may apply to the certifying officer to have the standing orders modified, and such application shall be accompanied by five copies of the modifications to be performed.

Temporary Application of Model Standing Orders

Model standing orders apply to an industrial establishment from the time the IESO Act becomes applicable to such establishment till the time the standing orders of the establishment are finally certified.

Procedure for Certification of Standing Orders

The process for certification of standing orders are specified below: Step 1: On receipt of the draft standing orders, the certifying officer will forward a copy to the trade union together with a notice in Form-11 where there is a trade union functioning in the industry. In case of no such trade union, the Certifying Officer will hold election of three representatives by the workmen from among themselves or authorise any officer in working to hold such election, and then a copy of the notice in Form-II can be forwarded. Step2: Certifying Officer after hearing make necessary modification in the draft standing order if required and certify the same and within seven days the copies of the standing order authenticated by him will reach to the employer and the trade union or the prescribed representatives of the workmen. Step 3: Any employer, workmen, trade union or other specified representatives of any workman aggrieved by the order of the Certifying Officer within thirty days from the date on which copies of the certified standing orders are sent can be submitted as a memorandum of appeal setting out the grounds of appeal in Form-IV in quadruplicate appeal to the Appellate Authority. Step 4: The Appellate Authority can proceed after giving the appellant an opportunity of being heard will pass final order on the appeal petition, and his decisions will be made final.

Payment of Subsistence Allowance

Where any workman is known to be suspended at the investigation or inquiry into complaints or charges of misconduct against him, it is mandatory for the employer to pay to such workman subsistence allowance at the following rates: For the first 90 (ninety) days: at the rate of 50% (percentage fifty) of the wages which the workman was entitled to immediately preceding the date of such suspension. For 91 (ninety-one) to 180 (one hundred eighty) days: at the rate of 75% (percentage seventy-five) of such wages of suspension if the delay in the completion of disciplinary proceedings against such workman is not directly attributable to the conduct of such workman. Virtually the order of suspension does not put an end to a workman’s service though he is not permitted to work and is paid only substance allowance which is less than is salary. This reduced rate of wages constitutes subsistence allowance.

Processing Time

Standing orders certified and their authenticated reports are forwarded to employers and workers within thirty days from the date of application submitted to the certifying officer.

Penalty

If an employer defaults to submit draft standing orders or modifies his standing orders, then the concerned officer may impose a penalty which will be above Rs 5,000 (five thousand), and in the case of a continuation of offence may impose a fine which will be above Rs 200 (two hundred) for every day till the offence continues. If the establishment does any act in violation of the standing orders after getting certified under this Act, then the employer will be punishable with the penalty of which will be more than Rs 100 (One hundred), and in the case of a continuation of offence may impose a fine of Rs 25 (twenty five) for every day till the offence continues.