Factory Act 1948 Objective, Scope, Definitions, Approval

Table of Contents:-

  • Historical development of factory legislation
  • Objective of the factory act 1948
  • Scope of Factory Act 1948
  • Definitions of Factory Act 1948
  • Approval, Licencing and Registration of Factories

The Factory Act 1948 sets the safety standards for workers employed in factories. It is applied to factories manufacturing goods, including weaving cloth, knitting hosiery and other knitwear, clothing, footwear production, dyeing and finishing textiles, manufacturing footwear, etc.

According to the Factories Act 1948, a working week should be at most 60 hours as it regulates the operating hours for all workers.

This Act aims to regulate factory hours or working time so that workers are well-rested and energized. The Act’s main objectives are protecting workers’ health and safety.

Historical development of factory ligislation

Evolution of Labor Legislation in Early Indian Factories

With the establishment of a Cotton Mill in 1851 and a Jute Mill in Bengal in 1855, the modern factory system was founded in India, employing women and children. Workers faced excessive and prolonged working hours with little recreation, and employers had considerable control. In 1881, the Indian Factories Act was passed to protect employees, especially children. In 1890, the Government of India appointed the Factory Commission, whose recommendations led to the passing of an Act in 1891. This amended the factory definition to include premises with fifty or more employees. Local Governments were given the authority to extend it to premises with twenty or more employees.

The Act included provisions for female employees, limiting their working hours with a requirement for a thirty-minute rest interval. It underwent periodic amendments, with the 1911 Act being modified in 1922 to implement the 1.2.0. Convention of 1919 on Hours of Work. Subsequent amendments occurred in 1923 and 1926. In 1934, the Act underwent a comprehensive revision and redrafting along the lines of recommendations made by the Royal Commission on Labour, which was appointed in 1929.

Revamping Labor Standards

The Transformation from the 1934 Act to the factory act 1948 is given below:

The Factories Act of 1934 underwent several amendments, leading to the passage of the new factory act 1948. Under the 1934 Act, Provincial Governments had the authority to apply the Act to establishments where power was used and more than ten persons were employed. It aimed to reduce working hours and enhance working conditions in factories, with provisions for adequate inspection and enforcement of the Act.

In 1948, the Factories Act of 1934 was revised, expanding its scope to include welfare, health, cleanliness, overtime payments, and similar measures. The purpose of the Factories Act was to ensure proper, safe, and healthy working conditions in factories, allowing workers to feel engaged and dedicated to their work without the fear of physical strain or the danger of accidents. The Act underwent periodic amendments up to 1976.

Addressing Hazardous Challenges: The Impetus Behind the 1987 Factories (Amendment) Act

By this time, many chemical factories had been set up to manufacture and handle hazardous and toxic chemicals. This brought about more problems related to safety and health. Before the government could assess the possible impact of the problem and foresee the possibilities of significant disasters, the world’s worst tragedy shocked Bhopal, wiping out thousands of innocent, ignorant lives in hours and leaving many more incapacitated. In 1987, the Factories (Amendment) Act 1987 was passed, serving as a memorial to the victims of the Bhopal disaster.

It provides better safeguards in using and handling hazardous substances in factories. The Act mandates management to implement enhanced safety measures, including precautions regarding using portable electric lights in factories. Additionally, it requires the appointment of safety officers in factories where 1000 or more workers are employed or where any manufacturing process or operation carries a risk of bodily injury, poisoning, disease, or any other hazard to the health of the persons employed in the factory.

Strengthening Protections and Penalties

Key Provisions in the Amended Act of 1987 are given below:

The amended Act also stipulates investigations of all fatal accidents within a month of their occurrence. It grants the Chief Inspector, Director General of Factory Advice Service and Labour Institutes, or the Director General of Health Services to the Government of India or any other authorized officer the power to conduct safety and occupational health surveys. The Act extends its protective clause to contract labor and any other category of work employed directly or through any agency, with or without the knowledge of the principal employer, whether for remuneration or not.

Furthermore, the amended Act prescribes the provision of creche facilities in every factory where more than 30 women workers (reduced from 50 as provided in the Principal Act) are ordinarily employed. According to the Act, if a worker is discharged, dismissed, quits, superannuated, or dies. At the same time, in service during the calendar year, they or their heir or nominee shall be entitled to wages instead of the quantum of leave due. The amended Act also outlines modified rates of the general penalty for offenses and enhanced penalties after a previous conviction.

Overhauling Legal Framework

A Comprehensive Look at the 1987 Amendments are given below:

Besides amendments to Sections 2, 4, 9, 13, 16, 18, 19, 23, 25, 28-32, 36-A, 64, 70, 80, 87, 89, 90, 91-A, 92, 94-99, 114, 119, and the schedule of the Principal Act, the amended Act of 1987 also includes the omission of Section 100 of the Principal Act and the insertion of new Sections 7-A, 7-13, 87-A, 96-A, 104-A, 106-A, 111-A, and 118-A. It substitutes new sections for Sections 36 and 38, inserts a new Chapter IVA after Chapter IV, and includes the insertion of two new schedules before the schedule to the Principal Act.

The newly inserted Sections 7-A, 7-B, 87-A, 96-A, 104-A, 106-A, 111-A, and 118-A relate to the general duties of the occupier, general responsibilities of manufacturers, etc., regarding articles and substances for use in factories, the power to prohibit employment on account of serious hazard; penalty for contravention of the provisions of Sections 41-B, 41-C, and 41-H, onus of providing limits of what is practicable, etc.; jurisdiction of a court for entertaining proceedings, and so on, for offenses, right of workers, etc.; and restriction on the disclosure of information; respectively.

Enhancing Safety Standards

A Deep Dive into Chapter IV-A is given below:

Sections 36 and 38 pertain to precautions against dangerous fumes, gases, etc., and protection in case of fire, respectively. The newly inserted Chapter IV-A, placed after Chapter IV of the principal Act, encompasses provisions related to hazardous processes, including:

i) Constitution of Site Appraisal.

ii) Mandatory disclosure of information by the occupier.

iii) Specific responsibility of the occupier about hazardous processes.

iv) Power of the Central Government to appoint Inquiry Committees.

v) Emergency standards.

vi) Permissible limits of exposure to chemical and toxic substances.

vii) Workers’ participation in safety management.

viii) Workers’ right to warn about imminent danger.

The new schedules, inserted before the Schedule to the Principal Act, contain the list of industries concerning hazardous processes and permissible levels of particular chemical substances in the working environment.

All provisions of the Factories (Amendment) Act, 1987 came into force on December 1, 1987, except the Schedule containing the list of notifiable diseases and Sections 7-13 and 41-F, which came into force on June 1, 1988.

Objective of the Act

The objective of the Act is to protect human beings from being subjected to unduly long hours of bodily strain or manual labor. It also aims to ensure that employees work in healthy and sanitary conditions to the extent that the manufacturing process allows and that precautions are taken for their safety and accident prevention.

Scope of Factory Act 1948

The Act extends to India and applies to all factories, including those belonging to the Central or any State Government, unless otherwise excluded. The benefits of this Act are available to persons employed in the factory and covered within the term ‘worker’ definition as defined in the Act. Therefore, discussing the meanings and descriptions of the terms ‘factory’ and ‘worker ‘is desirable. Since the term ‘factory’ refers to a manufacturing process, it would be helpful to understand the meaning of the term ‘manufacturing process’ as defined by the Act.

Definitions of Factory Act 1948

i) Factory

Section 2 (n) of the Factory Act, 1948, defines ‘factory’ to mean any premises, including the precincts thereof:

i) Where ten or more workers are currently or were employed on any day in the preceding twelve months and in any part of which a manufacturing process is being carried out with the aid of power or is ordinarily conducted.

ii) Where twenty or more workers are currently or were employed on any day in the preceding twelve months and in any part of which a manufacturing process is being carried out without the aid of power or is ordinarily conducted.

It specifically excludes:

  • A mine subject to the provisions of the Mines Act, 1952.
  • A railway running shed.
  • A mobile unit belonging to the armed forces of the Union.
  • A hotel, restaurant, or eating place.

Meaning of the words ‘Premises’:

‘premises’ means open land or land with buildings alone. Therefore, salt works where the process of converting seawater into salt is carried on in the open comes within the definition of ‘premises’ in the Act (ARDESHIR H. BHIWANDIWALA v. State of Bombay, A.I.R. 1962 SC 29). ‘Precincts’ means a space enclosed by a wall (in re K.V.V. Sharma v.  Manager Gemini Studio, Madras, A.I.R 1953 Mad. 29).

For any ‘premises’ to be categorized as a factory, two conditions must be fulfilled:

i) Ten or more persons are employed in the premises using or not using power.

ii) Twenty or more workers must be employed, not using power.

ii) Manufacturing Process

The expression ‘manufacturing process’ has been defined in Section 2(k) to mean any process:

i) Making, repairing, altering, ornamenting, packing, finishing, washing, oiling, cleaning, demolishing, breaking up, or otherwise treating or adapting any article or substance with a view to its use, transport, sale, delivery, or disposal.

ii) Pumping oil, sewage, water, or any other substance.

iii) Generating, transforming, or transmitting power.

iv) Composing types for printing, printing by letterpress, lithography, photogravure, or other similar processes, or bookbinding.

v) Constructing, reconstructing, refitting, finishing, or breaking up ships or vessels.

vi) Storing or preserving or any article in cold storage.

It was held in the case of the State of Bombay v Ali Saheb Kashim Tamboli (1995) 2 LLJ 182 that bidi-making is a manufacturing process.

In Ardeshir v Bombay State (Air 1962 SC 29), the process carried out in the saltworks comes within the definition of ‘manufacturing process’ in Section 2(k) in as much as salt can be said to have been manufactured from seawater by the process of treatment and adaptation of seawater into salt.

In re K.V.V. Sharma (1950) 1 LLJ 29, the conversion of raw films into a finished product was considered a manufacturing process. Similarly, in New Taj Mahal Cafe Ltd., Mangalore v. Inspector of Factories, Mangalore, 1956 1 LLJ 273, the preparation of foodstuffs and other edibles in the kitchen of a restaurant and the use of a refrigerator for treating or adapting any article with a view to its sale were also held to be manufacturing processes.

iii) Worker

Section 2(1) of the Factory Act 1948, defines a ‘worker’ to mean:

A person employed, directly or through any agency (including a contractor), with or without knowledge of the principal employer, whether for remuneration or not, in any manufacturing process or in cleaning any part of the machinery or premises used for a manufacturing process, or in any other kind of work incidental to, or connected with, the manufacturing process, or the subject of the manufacturing process, but does not involve any member of the armed forces of the Union. Therefore, a worker is a person:

i) who is employed;

ii) who is employed either directly or through any agency;

iii) who is employed in any manufacturing process, or in cleaning any part of the premises or machinery used for a manufacturing process, or in any other kind of work incidental to or connected with the manufacturing process or the subject of the manufacturing process.

If the conditions above are satisfied, it is immaterial whether a person was employed for remuneration.

Interpretations of Employment in Legal Precedents

Chintaman Rao v State of Madhya Pradesh (AIR 1958 All 44)

In Chintaman Rao v State of Madhya Pradesh (AIR 1958 All 44), the factory entered into contracts with independent contractors known as scatters. The attendees were supplied tobacco by the factories and, in some cases, bidi leaves. The attendees were neither bound to work in the factory nor to prepare the bidis themselves but could get them organized by others. They engaged coolies for rolling bids and made payments to them. They used to collect bidis from these coolies and take them to the factory, where the bidis were checked and sorted by the workers of the factory. The factory made payments to the attendees for the work of rolling bidis. The Supreme Court gave the restricted meaning to the words ‘directly or through any agency’ in Section 2(1). It held that

(i) a worker was a person employed by the management, and

(ii) there must be a contract of service and a relationship of servant and master between them. On the facts of the case, the Supreme Court held that the matters were independent contractors, and they and the coolies engaged by them for rolling bidis were not workers.

Dharangadhra Chemical Works v. State of Saurashtra (A.I.R 1957 SC 264)

In Dharangadhra Chemical Works v. State of Saurashtra (A I R 1957 SC 264), the Supreme Court held that the test of the relationship of servant and master is the master’s right of control and superintendence of the method of doing the work.

State of Kerala v V M Patel (1961(1) LLJ 549 (SC))

In State of Kerala v V M Patel (1961(1) LLJ 549 (SC)), the Supreme Court held that the work of garbling pepper by winnowing, cleaning, washing, and drying in lime and laid out to dry in a warehouse are manufacturing processes. Therefore, the people employed in these processes were workers within the meaning of Section 2(1) of the Fatory Act 1948.

Shankar Balaji Waje v. State of Maharashtra (AIR 1957 SC 517)

In Shankar Balaji Waje v. State of Maharashtra (A.I.R 1957 SC 517), Pandurang was engaged for rolling bidis. Although the work hours were fixed, attending during those hours was not obligatory. There was freedom to come and go. There was no fixed salary nor actual supervision of the work. The payment was made on the quantum of work. The Supreme Court held that such persons were not workers because there was no control and supervision over Pandurang.

Birdh Chand Sharma v First Civil Judge, Nagpur (A.I.R 1961 SC 644)

In Birdh Chand Sharma v First Civil Judge, Nagpur (A.I.R 1961 SC 644), the respondents prepared bidis at the factory and were not at liberty to work at their homes. They worked within certain hours, which were the factory hours. However, they were not bound to work for the entire period and could go whenever they liked. Their attendance was noted in the factory. They could come and go away at any time they wanted.However, no worker was permitted to work beyond midday, even though the factory closed at 7 p.m., and continuing work after 7 p.m. was also prohibited. There were standing orders in the factory, and under these orders, a worker who remained absent for eight days, presumably without leave, could be dismissed. The payment was made on a piece rate according to the quantum of work done, but the management had the right to reject such bidis as they did not meet the proper standard. On these facts, the Supreme Court held that respondents were workers under Section 2(1) of the Act.

iv) Occupier

Section 2(n) of the Act defines the “occupier” of a factory as the person who has ultimate control over the affairs of the factory. However, there are specific provisions for certain scenarios:

1. In the case of a farm or other association of individuals, any individual partners or members shall be deemed to be the occupier.

2. In the case of a company, any of the directors shall be deemed the occupier.

3. In the case of a factory owned or controlled by the Central Government, any State Government, or any local authority, the person or persons appointed to manage the affairs of the factory by the State Government, the Central Government, or the local authority, as the case may be, shall be deemed to be the occupier.

Occupier Status in Ship Repair and Maintenance

Furthermore, in the case of a ship undergoing repair or maintenance work in a dry dock available for hire, the occupier status is determined as follows:

1. The owner of the dock is deemed to be the occupier for specific matters provided for by or under-

a) Section 6,Section 7-A, Section 7, Section 7-B, Section 11, or Section 12;

b) Section 17 (about the provision and maintenance of sufficient suitable lighting in or around the dock);

c) Section 18, Section 19, Section 42, Section 46, Section 47, or Section 49 about the workers employed on such repair or maintenance.

2. The owner of the ship, or his agent, master, or other officer-in-charge of the boat, or any person contracting with such owner, agent, master, or other officer-in-charge to carry out the repair or maintenance work, is deemed to be the occupier for specific matters provided for by or under Section 13, Section 14, Section 16, or Section 17 (except as otherwise provided); or Chapter IV (except Section 27); or Section 43, Section 44, or Section 45; Chapter VI, Chapter VII, Chapter VIII, or Chapter IX; or Section 108, Section 109, or Section 110, about the workers employed directly by him or by or through any agency, and the machinery, plant, or premises used to carry out such repair or maintenance work by such master, owner, agent, or other officer-in-charge or person.

General Duties of the Occupier

The Factories introduced section 7A (Amendment) Act, and this new section outlines the general duties of an occupier as follows:

1. Ensure safe plant maintenance without risks to workers’ health.

2. Safeguard health and safety during the use, handling, storage, and transport of articles and substances.

3. Provide information, instruction, training, and supervision to ensure the health and safety of all workers.

4. Monitor the work environment

This section also imposes a duty on the occupier to prepare written statements of policy regarding the health and safety of workers and to notify the workers as per the rules.

Regarding the general duties of manufacturers concerning articles and substances for use in factories (Section 7B, where “article” includes plant and machinery), it outlines the general duties of designers, manufacturers, importers, and suppliers. Designers must ensure that their articles are safe and pose no risk to workers’ health. They are also responsible for conducting necessary tests and providing adequate information regarding safety and health risks.

Importers of articles must also ensure that the imported articles conform to the standards set out in the country or the standards adopted outside the country.

Other Definitions of Factory Act 1948

1. Adult: A person who has completed their 18th year of age. [Section 2 (a)]

2. Adolescent: A person who has completed their 15th year of age but has not completed their 18th year. [Section 2 (b)]

3. Calendar Year: Twelve months beginning with the first day of January in any year. [Section 2 (bb)]

4. Child: A person who has not completed their 15th year of age. [Section 2 (c)]

5. Young Person: A person who is either a child or an adolescent. [Section 2 (d)]

6. Day: Twenty-four hours beginning at midnight. [Section 2 (e)]

7. Week: Seven days beginning at midnight on Saturday night or any other night may be approved in writing for a particular area by the Chief Inspector of Factories. [Section 2 (f)]

Other Definitions of Factory Act 1948

8. Power: Electrical energy or any other form of mechanically transmitted energy that is not generated by human or animal agency. [Section 2 (g)]

9. Prime Mover: Any engine, motor, or other appliance that generates or provides power. [Section 2 (h)]

10. Transmission Machinery: Any shaft, drum, pulley, system of pulleys, coupling clutch, driving belt, or other appliance or device by which the motion of a prime mover is transmitted to or received by any machinery or apparatus. [Section 2 (i)]

11. Machinery: Includes prime movers, transmission machinery, and all other appliances whereby power is generated, transformed, transmitted, or applied. [Section 2 (j)]

12. Managing Agent: Has the meaning assigned to it in the Indian Companies Act, 1913 (VII of 1913). [Section 2 (o)]

13. Prescribed: Means prescribed by rules made by the State Government under this Act. [Section 2 (p)]

14. Relay and Shift: Where work of the same kind is performed by two or more sets of workers during different periods of the day, each  group is referred to as a ‘relay,’ and each of these periods is termed a ‘shift’ [Section 2 (r)].

Approval, Licencing and Registration of Factories

Approval, Licencing and Registration of Factories in Factory Act 1948 is given below:

i) General

The responsibility for obtaining approval for the premises when establishing a factory lies with the occupier. Section 6 grants the State Government the authority to develop rules that must be adhered to. Section 4 empowers the State Government to designate different departments or branches of a factory as separate entities, provided the occupier submits a written request. However, there is no provision to declare two or more factories of the same occupier as a single entity. State governments are also authorized to grant exemptions to any factory or a specific class of factories from all or some provisions of the Act (except Section 67) for a specified period under specified conditions in the case of a public emergency. A general crisis refers to a severe situation threatening the security of India or any part thereof, whether due to war, external aggression, or internal disturbance. Such notifications can be issued for three months at a time.

ii) Procedure for Licensing, Registration and Approval of Factories

Under factory act 1948, a factory must be approved and registered by the occupier after obtaining a license according to the rules established by the State Government. State Governments have the authority to formulate regulations mandating that the occupier of a factory submit plans for any class or type of factory to the Chief Inspector or State Government. Prior permission from the Chief Inspector of Factories is required for the site where the factory is proposed to be constructed or extended if the factory already exists. Replacing any plant or machinery that does not reduce the minimum clear space required for safe working or adversely affects environmental conditions does not constitute a factory extension.

According to the rules, the occupier must submit complete building plans with the necessary specifications for approval. As applicable, registration, obtaining, or renewing a license must be done by the occupier by the rules by paying the prescribed fees. The permission for the site on which the factory is proposed to be constructed or extended according to the plan must be granted by the relevant authority within three months. The permission is presumed if no response is received within the specified period. In case of refusal, the applicant may appeal to the State Government if refused by the Chief Inspector or to the Central Government if denied by the State Government within 30 days.

Notice Requirements and Compliance under Sections 6 and 7 of the Factories Act

No license or renewal of a permit shall be granted unless the occupier gives at least 15 days written notice to the Chief Inspector of Factories before proposing to occupy or use any premises as a factory. The information should include full particulars of the factory, such as the name and location, occupier’s name and address, owner’s name and address, the nature of the manufacturing process, total rated horsepower, name of the factory manager, the number of workers likely to be employed, and other particulars prescribed under the rules (Section 7(1)). For existing factories, notice with the specified details must be provided within 30 days from the Act’s commencement (Section 7(2)).

Before a factory engaged in a manufacturing process usually carried out for less than 180 working days in a year resumes working, the occupier must send full particulars to the Chief Inspector within 30 days of resuming work (Section 7(3)). Any change in the appointment of a manager must be communicated to the Chief Inspector within seven days by the occupier (Section 7(4)). When no manager is functioning, the occupier is deemed the manager for the Act. Non-compliance with the provisions of Sections 6 and 7 is an offense for which the occupier can be punished.


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