13 Laws Every HR Should Know

HR in an organization wears different faces shuffles based on requirements. Sometimes, wear an accountant's face to process salaries or distribute offers or joining letters. And Sometimes. They have to wear Manager’s face to sort out conflicts among employees. To perform all the roles well, they need a lawyer’s face to come in front and perform duties considering the law.

By understanding government and company laws and regulations, HR can perform well and support an organization's growth. HR plays an important role, from hiring to firing or layoffs - in trending terms. And to perform everything smoothly, the HR person should be sound in understanding laws to make correct decisions. Labour Laws are the major aspect to understand, which makes HR a complete personality with management and soft skills. Let's see the various labour laws that an HR should know.

We will not discuss the various amendments in this law that took place in the law after its inception. This is to build a basic understanding of various laws and regulations. Before we proceed here is a pro tip for you.

Rules and regulations for Employees Health, safety and welfare.

1. Labour Act - 1986:- first and foremost and quite simple to understand is the Child Labour Law 1986. Being an HR we already know that right? Still, let us see this rule in simple words.  
   First and foremost and quite simple to understand is the Child Labour Law 1986. Being an HR, we already know that, right? Still, let us see this rule in simple words.  

   This law stops children from working in any job and stops teenagers from working in dangerous jobs and processes, along with related matters or things related to it. And who are the children? “Child” means a person who has not completed the fourteenth year of age or such age as may be specified in the Right of Children to Free and Compulsory Education Act, whichever is more. 

   Now you must think that you have heard a lot about 18 years or below being called child laborers and that if they work, the employer will go to jail and pay the fine. 

   But this is partially true. The Government strictly governs that below 14 yrs a person cannot involve in any kind of employment that is called a child, but adolescents (teenagers between 14 and 18) can work except in Hazardous occupations like working in Mines and flammable substances, selling any kind of drugs or explosives (such as firework factories, petrol pump), etc. I Hope this builds a good understanding of this law. Now let us understand the next and one of the most important laws, i.e., the sexual harassment of Women at workplace act 2013.

   Source: https://labour.gov.in/sites/default/files/act_2.pdf 
   

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2. Harassment of Women at workplace Act - 2013:- HR often get complaints that come under sexual harassment, and because of a lack of knowledge, they cannot make wise decisions. HR should be aware of this so they can take strict disciplinary action to stop such activities at the workplace. To build a better understanding, let us understand what this law says in simple language.

   This Act is also known as the PoSH (Prevention, Prohibition and Redressal) Act, 2013. This law addresses the issues related to sexual harassment women face in the workplace. Any unwelcome act such as physical contact and sexual advances, demand or request for sexual favors, making sexually colored remarks, showing pornography, and any other verbal or non-verbal conduct of sexual nature comes under this Act. 

   Now depending on the level of action performed by the suspect, HR can take action or, if required, take disciplinary action with the help of the judiciary. 

   Source: https://www.iitk.ac.in/wc/data/Sexual-Harassment-at-Workplace-Act.pdf

3. Workplace Discrimination Law: People are facing discrimination at the workplace and working in state or central government or privately owned organizations all are falls get coverage of this law. Sometimes HR receives complaints mentioning workplace discrimination, and because of a lack of knowledge, they hide issues and fail to take disciplinary action. It majorly happened in the unorganized sector. After reading this article, HRs are now aware of the laws.  

   When an employee is treated unfairly, or any unwanted behavior that intentionally targets identity, race, disability, gender, caste, religion, age, or any other personal trait is considered workplace harassment. There are different laws and the Indian constitution sections talk about them in detail. Like Article 14 guarantees “equality before the law,” Section 24A guarantees no discrimination in employment, Section 24D focus on equal opportunity policies, etc.

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4. The Occupational Safety and Health:- This has various names and abbreviations. Some articles and books use “The Occupational Safety, Health and Working Conditions Code 2020 (OSHWC),”. In contrast, some shuffle the words and call it “Occupational Health & Safety Act (OHSA),” etc. The main thing to notice is this contains 3 main words Occupational, Safety, and Health. 

   This particular act covers many other sub-acts or related legislation in India, which further cover factory workers, dock workers,  building and construction workers, plantation laborers, contract laborers, inter-state migrant workers, working journalists, motor transport workers, sales promotion employees, cine workers etc.

   OSHWA or OSHA is the same whereas ISO 45001 is a certification under OSHA

   Source: https://labour.gov.in/sites/default/files/osh_gazette.pdf 

5. Equal Employment Opportunity laws (EEO): HR never selects based on gender, color, age, etc. The Law says Employment Opportunities should have an equal way to pursue a job based on merits regardless of religion, belief, sex, race, color, characteristic, etc. This Law focuses more on rejections that are based on any unlawful discrimination. The best candidate selection is still in the hand of HR/Employer, but rejection can be based on performance, qualification, etc, rather than discriminations like religion, sex, color, etc. 

   Here is a report that shows how EEO is a concern and how deeply it is rooted in society. Based on NAICS-3 report on total employees of 12.7 Lakhs found that 34.5 percent of women hold high positions, and the rest are men.

   Services	Men	Women	Difference(men over women)	Percentage
   Executive/senior level officials	480	172	308	64.17
   First/mid-level officials & managers	2850	1570	1280	44.91
   Professionals	2354	2098	256	10.88
   Technicians	1135	1069	66	5.81
   Sales Workers	461	359	102	22.13
   Office & Clerical Workers	904	1671	-767	-84.85
   Craft Workers	4138	459	3679	88.91
   Operatives	15594	7429	8165	52.36
   Laborers	21460	18381	3079	14.35
   Service Workers	2169	2250	-81	-3.73
   total	51545	35458	16087	31.21

    Source:- This table includes Asians and American Indians Working in US.*

6. Organizational Policies:- Organizations have different functions, departments, and internal rules & regulations. Based on that, HR should respond to issues that arise. Internal policies are a rule book for the organization that governs the day-to-day activities. Some of the regulations mentioned are restrictions, working hours and schedules, paid and unpaid time, leave structure, workplace safety, training, and many more. 

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7. The Apprentice Act, 1961:- Every HR knows the basic definition of this act. Some HRs call it internship, and some call it industrial training, but all come under the apprentice act. The major difference between these names is the payment and timings made to students. Apprentice means the student gets the payment and needs to work for a full day, whereas the internship is often unpaid and working hours are variable based on the candidate and organization’s needs.

   Education taught in colleges or institutions is not sufficient to prepare a student for industry-ready. Additional skills and knowledge of software or hardware are necessary to work in industries. Students can gain bookish knowledge but not the soft skills or skills need to work on machinery. Here, additional skills and knowledge are supplemented by training at the workplace. The prime objective of the act is to make optimum use of facilities available in industries for practical training and overall development. Apprentice acts shorten the time to develop skilled manpower, which is ready to work in industries.

   Source:https://www.msde.gov.in/en/about-msde/acts-and-rules 

8. The Maternity Benefit Act, 1961:- This act regulates the employment of women in certain establishments for a period before and after childbirth and provides maternity benefits and certain other benefits. To avail of these benefits, one needs to fulfill these prerequisites. Every organization with 10 or more employees needs to follow the act, and any woman who works for at least eighty days can ask for maternity benefits. 

   According to the act employer must pay a medical bonus of 1000 rupees*. In case of miscarriage or other pregnancy-related complications, she is entitled to paid leave. Women are also entitled to take paid leaves to feed their children. Also, firing or dismissing a pregnant woman is against the law. 

   Various Sections of the law are

   • Section 4: Employment of, or work of, women prohibited during certain periods. 
   • Section 5: Right to payment of maternity benefits.
   • Section 7: Payment of Maternity Benefits in case of death of a woman.
   • Section 8: Payment of Medical Bonus.
   • Section 9: Leave for miscarriage, etc.
   • Section 10: Leave for illness arising out of pregnancy, delivery, premature birth of a child, miscarriage, medicaltermination of pregnancy, or tubectomy operation.
   • Section 11: Nursing Breaks.
   • Section 12: Dismissal during the absence of pregnancy.
   • Section 13: No deduction of wages in certain cases.
   • Section 18: Forfeiture of maternity benefits.

   Source:- https://labour.gov.in/sites/default/files/the_maternity_benefit_act_1961_0.pdf

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9. Avoiding lawsuits and handling legal issues:- HRs rarely face lawsuits from employees, clients, or stakeholders. HR should be prepared for lawsuits against the company or employees. The company is liable for any illegal activity or action that occurred within the premises and with anyone working for the company. If that happens, HR should be prepared to intervene and solve the issue taking the judiciary in between.

Laws offer Compensation and reward

1. The Payment of Bonus Act, 1965:- Now here comes an interesting law ☺️. You might think you will get the bonus, but pay attention here. If you are an HR, you may get emails seeking bonuses from employees referring to this article. You can refer to this article and tell them you may not be eligible for this law. Let us understand the primary eligibility to avail of the benefits.

   1. Employee who worked 30 days or more in a year and took a salary maximum of 10,000 is entitled to this law.
   2. The bonus should be paid within 8 months from the close of accounting year or within one month.
   3. Minimum bonus of 8.33% of salary subject to a maximum limit of ₹3500/- pa

   Click the link and read more about the Payment of bonus act, 1965
   

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2. The Workmen’s Compensation Act, 1923:- Employees are the pillars of success for an organization, and every employer ensures that all employees receive proper financial compensation. In any case, they meet with an unfortunate accident at the workplace. This law helps compensate employees if they meet an accident, injuries and disfigurement, or death while performing duties. This law primarily covers 

   1. Injuries during an accident while on duty
   2. Temporary disablement
   3. Permanent disablement (complete or partial)
   4. Death due to an accident at work
   5. Injury, disease, or death resulting from working conditions
   6. All legal or any other expenses incurred by an employee in the above circumstances

   Source:- https://labour.gov.in/sites/default/files/theworkmenact19231.pdf 
   

3. The Employees State Insurance Act, 1948: Also called ESIC Act. The act ensures the monetary help given to the employee in case of maternity, disablement, infection or other health issues to workers of processing plant and cover their wards too. There is a scheme called Employers’ State Insurance Scheme started and designed based on ESIC Act. This scheme is financed by employers and employees. The employer contribution is about 4.75%, and 1.75% by the employee. 
   Major takeaways are 

   1. Employees drawing wages up to ₹15000 are entitled
   2. The coverage is from ₹15,000 to ₹21,000/-

   HR of the organization should know these facts so that they avoid lawsuits against the organization. 
   Source: https://www.esic.nic.in/Tender/ESIAct1948Amendedupto010610.pdf 
   

4. Family and Medical Leave Act of 1993: FMLA focuses on family emergencies and provides certain coverage to safeguard job and insurance coverage. This provides a certain amount of unpaid leave to overcome emergencies like pregnancy, family illness, etc.

   A few major benefits are

   1. This act is beneficial in case of long medical emergencies. In that case, job is secure whereas the remuneration is not paid.
   2. A maximum of 12 weeks of unpaid leave can be taken in case of more leave can take with mutualdiscussion.

   Fact about FMLA

   1. This law talks about unpaid leaves.
   2. Not all companies are covered under this act. Minimum of 50 employees working for a minimum period of 20 weeks.
   3. Leave is provided for reasons mentioned in the policies like childbirth, adoption, family, and/or personal illness.
   4. Not all employees are not covered
   5. Employers may ask for the medical certificate

   Source: https://www.govinfo.gov/content/pkg/COMPS-1832/pdf/COMPS-1832.pdf 

Conclusion

These are the laws HR should know about. And based on these laws, HR has to take action if something unlawful happens in the organization. Based on the situation, HR does change the behavior we discussed in the first paragraph. The behavior change is not intentional that HR is changing color like a Chameleon, but this is the need for an hour and organizational structure that lets HR change their job role. Overall this is to enhance the organization’s environment. 

If we talk about all available acts meant for the company and that HR should be aware of, then this webpage cannot load on your device. So mentioning a few more laws here, which you can google and learn about them. 

Law related to employment & training 

1. The Employment Exchange (Compulsory Notification of Vacancies) Act 1959
2. The Payment of Gratuity Act, 1972
3. 1 The Bonded Labour System (Abolition) Act, 1976 
4. The Child Labour (Prohibition & Regulation) Act, 1986
5. The factories act 1948
6. Employee Provident Fund Act 1947
7. The Payment of Wages Act, 1936