By Amol Pushp
Published On: October 5, 2021 at 14:43 IST
Introduction
Due to the rise of the Covid-19 and the consequent Nationwide lockdown imposed due to it, the economy suffered a huge blow. As a response for the same Government issued a notification dated April 17, 2020 under Section 5 of the Factories Act, 1948.
Through the exercise of the aforementioned power, the act aimed to exempt all class of factories from complying “various provisions relating to weekly hours, daily hours, intervals for rest etc. for adult workers,” as provided under Sections 51[i], 54[ii], 55[iii] and 56[iv] of the Act. In addition to this, the notification also called for revised working conditions applicable to the workers. The notification was applicable from April 20, 2020 till July 19, 2020.
Upon the lapse of the notification due to efflux of time, the State government issued another notification on 20 July 2020, which extended the grant of exemption till 19 October 2020. The said notification was challenged by the Gujarat Mazdoor Sabha and the Trade Union Centre of India before the Supreme Court of India.
The three-judge bench of the Supreme Court in the case of Gujarat Mazdoor Sabha Vs State of Gujarat[v], after due consideration struck down the notification, holding that “the economic slowdown created by the COVID-19 pandemic does not qualify as an internal disturbance threatening the security of the State” which was a precondition for the imposition of Section 5.
What were Issues Involved?
- Whether the economic crises caused due to the pandemic and resultant lockdown falls within the Ambit of ‘public emergency’ as provided in Section 5 of the Factories Act?
- Whether the impugned notification is ultra vires to the powers given under the Factories act and in contravention to the constitutional vision behind it.
Analysis
- Whether the economic crisis caused due to the Pandemic be considered as a ‘Public Emergency’ as provided in Section 5 of the Factories Act?
According to Section 5 of the Factories Act, The State Government can exempt any factories from the provisions of the statute, in case of a “public emergency”. The explanation provided under it defines “public emergency” as grave emergency that threatens the security of India (or any part of it) on account of war, external aggression, or internal disturbance.
The origin of “Public Emergency” of Section 5 of the Factories Act must be interpreted in the context of emergency under Article 352[vi]. The 44th amendment sought to limit the powers under Article 352[vii], and the expression “internal disturbance” was replaced with “armed rebellion”. Therefore, the power under Section 5 similarly must be used in a grave emergency. Further, it is necessary to evaluate whether a situation of internal disturbance threatens the security of India, or a part of its territory to qualify as a “public emergency”.[viii]
The respondent State argued that the spread of COVID-19 pandemic is a ‘public emergency’, as it has disturbed the “social order of the country” and has caused “extreme financial exigencies” in the State. And as the result of the same, it can be categorised as an ‘internal disturbance’ in the State within the meaning of Section 5. The learned council on behalf of the respondent contended that such temporary exemption is valid to overcome the financial crisis and to protect factories and establishments.
The court upon consideration held that, even after considering the respondents argument at the highest, that the pandemic has created internal disturbance, it cannot qualify as an internal disturbance threatening the security of the State. And unless the economic hardship is so extreme that it leads to disruption of public order and threatens the security of India or any part thereof, such recourse cannot be taken.[ix]
- Whether the impugned notification is ultra vires to the powers given under the Factories act and in contravention to the constitutional vision behind it.
It is essential to examine the purpose of Factories Act in the backdrop of the constitutional scheme of the Indian welfare State. The Factories Act is an integral element of the vision of State policy which seeks to uphold Articles 38, 39, 42 and 43 of the Constitution by ensuring decent working conditions and dignity of individual workers.
The “right to life” guaranteed to every person under Article 21, which includes a worker, would be devoid of an equal opportunity at social and economic freedom, in the absence of just and humane conditions of work, the Ideas of “freedom” and “liberty” in the fundamental rights will remain hollow. A workers Right to life cannot be a left at the mercy of the employer and is in contravention of the workers’ right to life and right against forced labour that are secured by 23 of the Constitution.
The blanket notifications exempt all factories from the applicability of Sections 51, 54, 55 and 56, effectively override Section 59 of the Factories Act. The Court held that the impugned notification is in contrary to the objective of the Factories act and legitimise the subjection of workers to onerous working conditions, when their feeble bargaining power is also reduced due to the Pandemic.
The two notifications make significant departures from the mandate of the Factories Act, which were:
- Increase the daily limit of working hours from 9 hours to 12 hours;
- Increase the weekly work limit from 48 hours to 72 hours, which translates into 12-hour work-days on 6 days of the week
- Negate the spread over of time at work including rest hours, which is typically fixed at 10.5 hours;
- Enable an interval of rest every hour, as opposed to 5 hours; and
- Mandate the payment of overtime wages at a the proportionate to the ordinary rate of wages, instead of overtime wages at there of double the ordinary rate of wages as provided under Section 59.[x]
The respondent Government contended that this was necessary in light of “extreme financial exigencies arising due to the spread of COVID-19 Pandemic” and have been deployed as “a holistic approach to maintain the production, adequately compensate workers and take sufficient measures to safeguard the said factories and establishments in carrying out essential activities”.
The Honourable Supreme Court rejected such submissions and held that, “The impugned notifications do not serve any purpose, apart from reducing the overhead costs of all factories in the State, without regard to the nature of their manufactured products.” It emphasised that it is not reasonable to exempt all factories from such cost without any specification. It is indicative of the intention to capitalise on the pandemic to force an already worn-down class of society, into the chains of servitude.
Labour Welfare is an integral part of on the vision behind the Indian constitution which aims to achieve social and economic democracy. Therefore, the state does not have free reign to eliminate provisions promoting dignity and equity in the workplace in the face of novel challenges to the State administration, unless it causes a grave threat to the security of the State.
Conclusion
The 3-judge bench quashed the notification and in the in the interest of doing complete justice under Article 142 of the Constitution, directed the overtime workers are justly remunerated in accordance with Section 59 of the Act, who have been working since the notification was issued. The judgement was noteworthy for upholding the rights of the labourers with feeble bargaining powers.
It recognised the right of the labourers as an essential constitutional vision and reiterated that Factories Act being a socialist legislation cannot be misused by the whim of the government. It also set a good precedent as to the limitation on the use of Public emergency so that the Pandemic cannot be used as an excuse to shift the economic burden to the poorest and the legislation is not misused by rich capitalists.
Edited by: Aashima Kakkar, Associate Editor, Law Insider
[i] Section 51, the Factories Act, 1948
Weekly hours. —No adult worker shall be required or allowed to work in a factory for more than forty-eight hours in any week.
[ii] Section 54, the Factories Act, 1948
Daily hours. —Subject to the provisions of section 51, not adult worker shall be required or allowed to work in a factory for more than nine hours in any day.
[iii] Intervals for rest. — [The periods of work] of adult workers in a factory each day shall be so fixed that no period shall exceed five hours and that no worker shall work for more than five hours before he has had an interval for rest of at least half an hour.
[iv] Section 56, the Factories Act, 1948
Spread over. —The periods of work of an adult worker in a factory shall be so arranged that inclusive of his intervals for rest under section 55, they shall not spread over more than ten and a half hours in any day
[v] Gujarat Mazdoor Sabha Vs State of Gujarat 2020 SCC OnLine SC 798, (2020) 10 SCC 459
[vi] Ibid. at 1, Para 18
[vii] The Constitution of India, 1952. Article 352
[viii] Ibid. at 1, Para 21
[ix] Ibid. at 1, Para 30
[x] Ibid. at 1, Para 35