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LABOUR AND INDUSTRIAL LAW: QUICK REVISION NOTES FOR CLAT PG

Hanspal Bakul 11 November 2026 7 min read

The most important development under Labour and Industrial Law to remember for CLAT PG 2027 is that all four Labour Codes came into force on 21 November 2025. They consolidate 29 Central labour laws. Therefore, these quick revision notes primarily follow the new Labour Codes rather than treating the repealed enactments as the current governing framework.

The earlier legislations, including the Industrial Disputes Act, 1947, Trade Unions Act, 1926, Factories Act, 1948, Minimum Wages Act, 1948 and Payment of Wages Act, 1936, remain important for understanding the evolution of labour jurisprudence and landmark judgments.

Definition of of "Industry" Revisited by 9-Judges Bench of Supreme Court

The four Labour Codes at a glance

Labour CodeMain subjectEarlier laws consolidated
Code on Wages, 2019Minimum wages, payment of wages, bonus, equal remuneration4
Industrial Relations Code, 2020Trade unions, industrial disputes, standing orders3
Code on Social Security, 2020EPF, ESI, gratuity, maternity benefits, social security9
OSH and Working Conditions Code, 2020Health, safety, welfare, working conditions13

PART I - CONSTITUTIONAL FRAMEWORK OF LABOUR LAW

Labour law in India is closely connected with the constitutional ideals of social justice, equality, dignity and protection against exploitation.

1. Fundamental Rights

ArticleSubjectLabour law significance
Article 14Equality before lawProhibits arbitrary discrimination in employment.
Article 16Equality in public employmentGuarantees equal opportunity in public employment.
Article 19(1)(c)Freedom of associationProtects the right to form associations and trade unions, subject to reasonable restrictions.
Article 21Right to life and dignityIncludes protection of human dignity and livelihood-related interests.
Article 23Prohibition of forced labourProhibits begar, trafficking and other forms of forced labour.
Article 24Prohibition of child labourProhibits employment of children below 14 years in factories, mines and hazardous employment.

2. Directive Principles of State Policy

These provisions guide the State in framing labour welfare legislation.

3. Legislative competence

Labour is primarily a Concurrent List subject under the Seventh Schedule.
Important entries:

PART II - INDUSTRIAL RELATIONS CODE, 2020

In force from 21 November 2025
The Industrial Relations Code, 2020 consolidates the laws relating to:
  1. Trade unions.
  2. Conditions of employment in industrial establishments.
  3. Investigation and settlement of industrial disputes.
  4. Strikes and lock-outs.
  5. Lay-off, retrenchment and closure.
It replaces the:

1. Important definitions

Section 2 - Definitions
Important expressions include:

2. Trade Unions

Trade unions are organisations formed to regulate relations between employers and workers and protect the collective interests of workers.
The earlier Trade Unions Act, 1926 has been subsumed into Chapter III of the Industrial Relations Code, 2020.
Important provisions
ProvisionSubject
Section 5Appointment of Registrar
Section 6Criteria for registration
Section 7Application for registration
Section 8Registration of trade unions
Section 9Cancellation of registration
Section 10Appeal against refusal or cancellation
Section 12Incorporation of registered trade unions
Section 13Rights and liabilities of registered trade unions
Section 14Negotiating union or negotiating council
Section 15Rights of negotiating union or negotiating council
Section 16Trade union funds
Section 17Immunity from certain civil suits
Section 18Immunity from criminal conspiracy in trade union activities
Section 19Enforceability of agreements
A. Registration of trade unions
B. Legal status
Under Section 12, a registered trade union becomes a body corporate.
It has:
C. Negotiating union and negotiating council - Section 14
D. Immunities of trade unions

Trade Unions under Industrial Law

3. Industrial Disputes

An industrial dispute generally concerns disagreements between employers and employers, employers and workers, or workers and workers relating to employment, non-employment, terms of employment or conditions of labour.
Important provisions of the Industrial Relations Code
SectionTopic
Section 42Voluntary reference of disputes to arbitration
Section 43Conciliation officers
Section 44Industrial Tribunal
Section 46National Industrial Tribunal
Section 53Conciliation proceedings
Section 55Awards and their operation
Section 62Prohibition of strikes and lock-outs
Section 63Illegal strikes and lock-outs
Section 70Prohibition of lay-off
Section 71Compensation for lay-off
Section 72Conditions precedent to retrenchment
Section 74Compensation to workers in case of transfer of establishment
Section 77Application of Chapter X
Section 78Procedure for permission for lay-off, retrenchment and closure
Section 79Special provisions relating to lay-off, retrenchment and closure
Section 80Compensation to workers in case of closing down of undertakings

A. Industrial dispute settlement machinery

1. Conciliation Officer - Section 43
2. Industrial Tribunal - Section 44
3. National Industrial Tribunal - Section 46
Constituted by the Central Government for industrial disputes involving questions of national importance or affecting industrial establishments situated in more than one State.
4. Voluntary arbitration - Section 42
Parties may voluntarily refer an industrial dispute to arbitration through a written agreement in accordance with the Code.

B. Strikes and lock-outs

Section 62 - Prohibition of strikes and lock-outs
A worker cannot legally commence a strike in breach of contract:
  1. Without giving notice of strike within 60 days before striking.
  2. Within 14 days of giving the notice.
  3. Before the date specified in the strike notice.
  4. During pending conciliation proceedings and seven days after their conclusion.
  5. During proceedings before a Tribunal or National Industrial Tribunal and 60 days after their conclusion.
  6. During arbitration proceedings and 60 days after their conclusion, where the statutory conditions apply.
  7. During the operation of a settlement or award in respect of matters covered by it.
Section 63: Strikes and lock-outs commenced or declared in contravention of Section 62 are illegal.
Constitutional connection: Article 19(1)(c) protects the right to form associations and unions, but does not confer a fundamental right to strike.

C. Lay-off, retrenchment and closure

ConceptMeaning
Lay-offEmployer's inability, failure or refusal to provide employment due to specified operational reasons.
RetrenchmentTermination of service by the employer for any reason whatsoever, subject to statutory exclusions.
ClosurePermanent closing down of a place of employment or part thereof.
Retrenchment - Section 72
Important requirements include:
Special provisions - Sections 77-80
Chapter X introduces additional requirements for certain establishments.
The special prior-permission regime generally applies to industrial establishments covered by the statutory threshold of 300 or more workers, subject to the provisions of the Code and applicable notifications.

4. Standing Orders

Standing orders prescribe the conditions of employment and regulate the relationship between employers and workers.
They deal with:
Important provisions:
The standing orders chapter generally applies to industrial establishments employing 300 or more workers.

5. Grievance Redressal Committee

Section 4 - Grievance Redressal Committee

PART III - CODE ON WAGES, 2019

In force from 21 November 2025
The Code on Wages, 2019 consolidates four earlier laws:
  1. Minimum Wages Act, 1948.
  2. Payment of Wages Act, 1936.
  3. Payment of Bonus Act, 1965.
  4. Equal Remuneration Act, 1976.

1. Important provisions

SectionSubject
Section 2Definitions
Section 3Prohibition of discrimination on ground of gender
Section 4Decision regarding disputes relating to same or similar nature of work
Section 5Payment of minimum rate of wages
Section 6Fixation of minimum wages
Section 8Revision of minimum wages
Section 9Floor wage
Section 10Wages for working hours less than normal working day
Section 13Fixing hours of work for normal working day
Section 14Overtime wages
Section 15Wages for work on rest day
Section 16Mode of payment of wages
Section 17Time limit for payment of wages
Section 18Deductions from wages
Section 26Eligibility for bonus
Section 27Proportionate reduction in bonus
Section 29Minimum bonus
Section 31Maximum bonus
Section 34Prohibition of deductions from bonus payable
Section 45Claims under the Code
Section 51Offences and penalties

2. Minimum wages

Section 5 - Payment of minimum rate of wages
No employer can pay an employee less than the minimum wage notified by the appropriate Government.
Section 6 - Fixation of minimum wages
The appropriate Government fixes minimum wages, considering factors such as:
Section 9 - Floor wage
Minimum wageLiving wage
Statutory minimum below which payment is prohibited.Wage intended to secure a decent standard of living.
Enforceable through wage legislation.Constitutional objective under Article 43.

3. Payment of wages

Section 16: Wages may be paid in cash, by cheque, through bank credit or electronic mode, subject to the Code.
Section 17: Prescribes the time limits for payment of wages.
Important limits:
In case of removal, dismissal, retrenchment, resignation or unemployment due to closure, wages payable must generally be paid within two working days.

4. Deductions from wages

Section 18
Deductions can be made only as authorised by the Code.
Examples:
The total deductions in a wage period ordinarily cannot exceed 50% of wages.

5. Equal remuneration

Section 3
Prohibits gender-based discrimination in wages for the same work or work of a similar nature.
It also prohibits discrimination on the ground of gender in recruitment and conditions of employment for the same or similar work, subject to statutory exceptions.
There was an explicit mention of the "Authority of Council" and "Broad View" tests established by the SC. The Court held that to determine if work is of a "similar nature," one must look at the duties actually performed, not just the job designation or minute differences in working hours.

6. Bonus

The Code retains the framework of statutory bonus.
Minimum bonus: 8.33% of the wages earned or ₹100, whichever is higher, subject to statutory conditions.
Maximum bonus: 20% of wages.
The employee must satisfy the statutory eligibility conditions, including the prescribed wage ceiling and minimum days of work.

PART IV - CODE ON SOCIAL SECURITY, 2020

In force from 21 November 2025
The Code on Social Security, 2020 aims to extend social security protection to employees, organised workers, unorganised workers, gig workers and platform workers.
It consolidates nine Central labour legislations, including laws concerning:

1. Important provisions

SectionSubject
Section 2Definitions
Section 3Registration of establishments
Section 4Central Board of Trustees
Section 5Employees' Provident Fund Scheme
Section 6Employees' Pension Scheme
Section 7Employees' Deposit Linked Insurance Scheme
Section 15Employees' State Insurance Corporation
Section 16Employees' State Insurance Fund
Section 44-52Gratuity
Section 53-58Maternity benefit
Section 60Payment of gratuity
Section 91Employees' compensation
Section 109Social security for unorganised workers
Section 114Schemes for gig workers and platform workers

2. Employees' Provident Fund (EPF)

Provident fund is a social security mechanism designed to provide financial protection after retirement.
The Central Government may frame schemes for provident fund, pension and insurance benefits.
Purpose: Retirement savings, pension protection and financial security for employees and their families.

3. Employees' State Insurance (ESI)

ESI provides medical and social security benefits to eligible employees.
Benefits include:
Exam point: The ESI framework is contributory and provides protection against specified employment-related and health contingencies.

4. Gratuity

Gratuity is a lump-sum payment made by an employer to an employee in recognition of service rendered.
Ordinarily, gratuity becomes payable after five years of continuous service.
Exceptions: The five-year requirement is not necessary in cases of death or disablement. Fixed-term employees are also governed by the special statutory provisions concerning gratuity.

5. Maternity Benefit

The Code protects women employees during pregnancy and childbirth.
Important features:
The Supreme Court extended maternity benefit protection to women employed on a casual or muster-roll basis, emphasising the dignity of motherhood and social justice.

6. Gig workers and platform workers

One of the most significant developments in the Social Security Code is the recognition of gig and platform workers.
Section 2: Contains definitions relating to gig workers, platform workers and aggregators.
Section 109: Provides for social security schemes for unorganised workers.
Section 114: Empowers the Central Government to frame schemes for gig workers and platform workers.
Examples:
Important distinction:

PART V - OCCUPATIONAL SAFETY, HEALTH AND WORKING CONDITIONS CODE, 2020

In force from 21 November 2025
The OSH Code, 2020 consolidates 13 Central labour laws, including the Factories Act, 1948, Contract Labour (Regulation and Abolition) Act, 1970, Mines Act, 1952 and Inter-State Migrant Workmen Act, 1979.
Its primary objective is to regulate occupational safety, health, welfare and working conditions.

1. Important provisions

SectionSubject
Section 2Definitions
Section 3Registration of certain establishments
Section 4Appeal against refusal of registration
Section 6Duties of employer
Section 10Occupational safety and health standards
Section 14Safety committees and safety officers
Section 18Employer's responsibility for maintaining health, safety and working conditions
Section 23Daily and weekly working hours, leave and overtime
Section 24Weekly and compensatory holidays
Section 25Overtime wages
Section 32Annual leave with wages
Section 43Appointment of inspectors-cum-facilitators
Section 53Welfare facilities
Section 55Daily working hours and rest intervals
Section 59Safety provisions relating to factories
Section 60Welfare provisions relating to factories
Section 67Employment of women
Section 68Notice of accidents
Section 69Notice of dangerous occurrences
Section 70Notice of certain diseases
Note: Always use the consolidated Code's section numbering rather than carrying forward the old Factories Act section numbers.

2. Duties of employers - Section 6

The employer must:

3. Working hours

Section 23
The Code provides for:
Section 25 - Overtime
Overtime wages must be paid at twice the normal rate of wages, subject to the statutory conditions.

4. Annual leave with wages

Section 32
An employee working for the prescribed number of days in a calendar year becomes eligible for annual leave with wages.
Generally:
The Code also contains provisions concerning leave accumulation and encashment.

5. Employment of women

Section 67
Women are entitled to work in all establishments and for all types of work under the Code.
They may be employed before 6 AM and beyond 7 PM with their consent and subject to prescribed conditions relating to safety, holidays and working hours.

6. Contract Labour

The OSH Code regulates contract labour and the responsibilities of contractors and principal employers.
Important provisions include:
The general applicability threshold for the contract labour provisions is 50 contract labourers, subject to the Code.

7. Inter-State Migrant Workers

The OSH Code recognises inter-State migrant workers and provides for their welfare and protection.
Important aspects:
The definition under the Code also recognises certain workers who migrate independently and are employed in another State, subject to the statutory wage ceiling and other conditions.

8. Factories: Important concepts for CLAT PG

Although the Factories Act, 1948 has been subsumed into the OSH Code, its historical provisions and related case law remain extremely important.
The following are particularly important:
Earlier Factories Act provisionSubject
Section 2(m)Definition of factory (Under the OSH Code, the definition of a "Factory" (replacing the old Section 2(m)) increased its thresholds to 20 workers (with power) and 40 workers (without power))
Section 2(k)Manufacturing process
Section 7AGeneral duties of occupier
Section 11Cleanliness
Section 13Ventilation and temperature
Section 21Fencing of machinery
Section 23Employment of young persons on dangerous machines
Section 28Hoists and lifts
Section 32Floors, stairs and means of access
Section 41BCompulsory disclosure of information regarding hazardous processes
Section 41CSpecific responsibilities of occupier in relation to hazardous processes
Section 41FPermissible limits of exposure to chemical and toxic substances
Section 42Washing facilities
Section 45First-aid appliances
Section 46Canteens
Section 47Shelters, rest rooms and lunch rooms
Section 48Creches
Section 49Welfare officers
Section 51Weekly working hours
Section 54Daily working hours
Section 59Overtime wages
Section 67Prohibition on employment of young children
  1. The Factories Act, 1948: Part 1 - Foundational Provisions
  2. The Factories Act, 1948: Part 2 - Welfare, Working Hours and Enforcement
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