What are the labour laws that foreign businesses need to be aware of in India?

What are the labour laws that foreign businesses need to be aware of in India?

Answered by

MAHESHWARI & CO.

Published At July 10, 2024

Answer

Foreign businesses in India must adhere to several key labour laws to ensure compliance and smooth operations. Labour laws in India for foreign companies include:

  • The Employee’s Provident Funds and Miscellaneous Provisions Act, 1952: Mandates contributions to the provident fund from both employees and employers, ensuring social security for workers​​.
  • The Employee’s State Insurance Act, 1948: Provides medical care and cash benefits in the event of sickness, maternity and employment injury. Applicable to establishments with ten or more employees​​.
  • The Industrial Disputes Act, 1947: Governs the resolution of industrial disputes and conditions under which workers can be laid off, retrenched or terminated, aiming to maintain industrial harmony​.
  • The Payment of Gratuity Act, 1972: Ensures payment of gratuity to employees with at least five years of continuous service as a form of gratitude for their service​​.
  • The Maternity Benefit Act, 1961: Provides for maternity leave and benefits to female employees, ensuring 26 weeks of paid leave for women in establishments with ten or more people​​.
  • The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013: Mandates creation of an internal complaints committee to address sexual harassment complaints in workplaces with ten or more employees.
  • The Equal Remuneration Act, 1976: Ensures equal pay for equal work for men and women and prohibits gender discrimination in hiring​ ​.

Compliance with these  labour laws in India for foreign companies helps them to operate legally and ethically in India, fostering a positive working environment.

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