Worker under the Industrial Relations Code, 2020
The definition of Worker is provided under Section 2(zr) of the Industrial Relations Code, 2020.
A Worker is a person employed in an industry to perform any of the following types of work for hire or reward:
- Skilled work
- Semi-skilled work
- Unskilled work
- Manual work
- Operational work
- Supervisory work
- Technical work
- Clerical work
A worker may be employed directly or through a contractor.
Essential Ingredients of a Worker
For a person to qualify as a worker under the Code, the following conditions should generally exist:
1. Employment in an Industry
The person must be employed in an establishment that qualifies as an industry.
Example
A machine operator working in a textile factory is a worker.
2. Employment for Hire or Reward
The work should be performed in return for wages or remuneration.
Example
A software technician receiving a monthly salary is a worker.
3. Nature of Work
The work may be:
- Manual
- Technical
- Clerical
- Operational
- Skilled
- Semi-skilled
- Unskilled
- Supervisory (subject to statutory conditions)
4. Employer-Employee Relationship
There must be a contractual relationship between employer and worker.
This relationship may arise through:
- Appointment letter
- Employment contract
- Contractor
- Statutory appointment
Persons Generally Excluded from the Definition of Worker
The following are generally not treated as workers:
- Members of the Armed Forces
- Police personnel
- Employees mainly employed in managerial or administrative capacity
- Supervisors drawing wages above the statutory limit and performing mainly managerial functions (subject to the applicable provisions of the Code)
Examples of Workers
- Factory machine operator
- Electrician
- Driver employed by a transport company
- Accountant
- Computer operator
- Data entry operator
- Welder
- Technician
- Security guard
- Production supervisor (if not mainly managerial)
Landmark Case Laws Relating to Worker
1. Burmah Shell Oil Storage and Distribution Co. v. Burmah Shell Management Staff Association
Principle
The Supreme Court held that the designation of an employee is not decisive. The actual nature of duties determines whether a person is a worker.
Importance
Always examine the duties actually performed rather than the job title.
2. S.K. Verma v. Mahesh Chandra (1983)
Principle
The Court adopted a liberal interpretation while determining who qualifies as a workman (now “worker” under the Code).
Importance
Beneficial labour legislation should generally be interpreted in favour of workers.
3. H.R. Adyanthaya v. Sandoz (India) Ltd. (1994)
Principle
The Supreme Court clarified that an employee must satisfy the statutory definition to claim the protection available to workers.
Importance
One of the leading authorities on determining worker status.
Employer under the Industrial Relations Code, 2020
The definition of Employer is provided under Section 2(l) of the Industrial Relations Code, 2020.
An Employer means a person or authority who employs one or more workers in an establishment and includes persons responsible for supervision, control and management of the establishment.
Depending on the nature of the establishment, the employer may be:
- Owner
- Occupier
- Managing Director
- Manager
- Government Department
- Local Authority
- Chief Executive Officer
- Person authorised to manage the establishment
Essential Characteristics of an Employer
1. Employs Workers
The employer appoints workers for performing work.
2. Exercises Control
The employer supervises and controls the work.
3. Pays Wages
The employer is responsible for payment of wages and other service benefits.
4. Has Power to Appoint and Dismiss
The employer has authority regarding:
- Recruitment
- Promotion
- Transfer
- Suspension
- Disciplinary action
- Termination
Examples of Employers
- Factory owner
- Company Director
- Managing Director
- Government Department
- Municipal Corporation
- Hospital Management
- School Management
- IT Company
- Bank
Landmark Case Laws Relating to Employer
1. Dharangadhra Chemical Works Ltd. v. State of Saurashtra (1957)
Principle
The Supreme Court emphasized the control and supervision test to determine the employer-employee relationship.
Importance
One of the earliest landmark decisions in labour law.
2. Silver Jubilee Tailoring House v. Chief Inspector of Shops (1974)
Principle
The Court held that the degree of control exercised over workers is an important factor in deciding whether an employer-employee relationship exists.
3. Ram Singh v. Union Territory, Chandigarh (2004)
Principle
The Supreme Court discussed several tests for determining employment, including:
- Control Test
- Integration Test
- Economic Control Test
Comparison Between Industry, Worker and Employer
| Basis | Industry | Worker | Employer |
|---|---|---|---|
| Meaning | Organised activity | Person employed | Person employing workers |
| Section | 2(p) | 2(zr) | 2(l) |
| Main Function | Produce goods/services | Perform work | Manage and supervise |
| Objective | Satisfy human wants | Earn wages | Conduct business |
| Relationship | Requires employer and worker | Works under employer | Employs worker |
| Examples | Factory, Bank, Hospital | Technician, Clerk | Factory Owner, Company |
Practical Illustration
Consider an automobile manufacturing company.
The company manufacturing cars is the Industry.
The engineers, machine operators and technicians are the Workers.
The Managing Director and factory management represent the Employer.
All three are essential for industrial relations.
Why are These Definitions Important?
These definitions help in determining:
- Applicability of the Industrial Relations Code
- Eligibility for labour law protection
- Rights and liabilities of employers
- Eligibility to raise industrial disputes
- Collective bargaining
- Settlement of labour disputes
Almost every question in Industrial Relations Law begins by identifying:
- Is it an Industry?
- Is the person a Worker?
- Who is the Employer?
Remember the following Sections:
| Topic | Section |
|---|---|
| Employer | 2(l) |
| Industry | 2(p) |
| Worker | 2(zr) |
Remember the three most important Supreme Court cases:
- Bangalore Water Supply and Sewerage Board v. A. Rajappa (1978) – Triple Test for Industry.
- Dharangadhra Chemical Works Ltd. v. State of Saurashtra (1957) – Control Test for Employer-Employee Relationship.
- H.R. Adyanthaya v. Sandoz (India) Ltd. (1994) – Statutory Definition of Worker.
Frequently Asked FAQs
Is every employee a worker?
No. Employees performing mainly managerial or administrative functions are generally excluded from the statutory definition of a worker.
Can a hospital be an Industry?
Yes. If it satisfies the statutory requirements and the principles laid down in Bangalore Water Supply, a hospital may be treated as an Industry.
Is profit necessary for an Industry?
No. Profit motive is not an essential requirement under the Industrial Relations Code, 2020.
Can one worker raise an industrial dispute?
Yes. Under the Industrial Relations Code, disputes relating to dismissal, discharge, retrenchment or termination may be raised directly by an individual worker without requiring the support of a trade union.
Conclusion
The concepts of Industry, Worker, and Employer form the backbone of the Industrial Relations Code, 2020. Every industrial dispute depends upon these three definitions. Courts have consistently interpreted these terms in a manner that promotes industrial harmony while protecting the legitimate rights of both employers and workers.
For KSLU students, it is advisable to quote the statutory definitions, mention the relevant section numbers, cite at least two landmark Supreme Court judgments, and provide practical examples. Such an approach demonstrates a sound understanding of both the statutory provisions and judicial interpretation, helping students secure higher marks in examinations.
