Concrete

Salient points of Occupational Safety, Health and Working Conditions Code, 2019

Published

3 years ago

July 1, 2021

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Ensuring occupational safety, no harm to existing health and proper working condition for all the workforce in every enterprise is a necessary and essential requirement for running any business, In India we have four main legislations that cover Occupational Safety and Health at workplace. (i) The Factories Act, 1948 , covering factories wherein the enforcement of safety at workplace is by the Chief Inspector of Factories in the respective states, (ii) The Mines Act, 1952 and Mines Rules, 1955 for mining industry where the enforcement is by Directorate General of Mines Safety (DGMS) under Ministry of Labour & Employment , Government of India, (iii) The Dock Workers (Safety, Health and Welfare) Act, 1986 followed by notification of the Dock Workers (Safety, Health and Welfare) Regulations, 1990 dealing with the major ports of India and the enforcement is by Director General, Directorate General of Factory Advice Service & Labour Institutes (DGFASLI), under Ministry of Labour & Employment, Government of India, and (iv) The Building & Other Construction Workers (Regulations of Employment and Conditions of Service) Act, 1996, covering construction workers at construction sites wherein the enforcement is by the State Government.

The Second National Commission on Labour submitted its Report on ??ccupational Safety, Health and Working Conditions of the Workers??in June, 2002 and made certain recommendations including the need to consolidate various laws. In pursuance of the recommendations of the said Commission, the National Democratic Alliance Government has introduced Bill Number 186 of 2019 on 23 July 2019 called ??he Occupational Safety, Health and Working Conditions Code, 2019??in the Lok Sabha, which has 134 clauses and three schedules. While the schedule one and three are identical to the schedules in The Factories Act ,1948, but the schedule two covers many items relevant to occupational safety, health and working conditions. The Code will subsume 13 labour laws and would apply to all establishments employing 10 or more workers. These include (a)The Factories Act, 1948; (b) The Mines Act, 1952; (c) The Dock Workers (Safety, Health and Welfare) Act, 1986; (d) The Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996; (e) The Plantations Labour Act, 1951; (f) The Contract Labour (Regulation and Abolition) Act, 1970; (g) The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979; (h) The Working Journalist and other News Paper Employees (Conditions of Service and Miscellaneous Provision) Act, 1955; (i) The Working Journalist (Fixation of rates of wages) Act, 1958; (j) The Motor Transport Workers Act, 1961; (k) The Sales Promotion Employees (Conditions of Service) Act, 1976; (l) The Beedi and Cigar Workers Act, 1966; (m) The Cine Workers and Cinema Theatre Workers Act, 1981 (details refer section 134). Presently each of these 13 labour laws have Rules and we still have to await the Rules that the Central Government frames for this code, which can be the same or modified by the State Governments.

This code is one of the four labour codes and is currently referred to the Parliamentary Standing Committee for consideration, and hence will take some time, before it gets passed by the Lok Sabha and becomes an Act. The rules with reference to the Code have still to be framed and made public.

Given below are summary analysis of certain relevant sections in the code:

Section 2 of every labour legislation deals with definitions. Since, this code is to replace 13 labour legislations which deal with various aspects apart from the area of Occupational Safety, Health and Working Conditions the definition of the words in section 2 needs to be understood and analysed, to realise the modification where they are taking place through the code. In most cases, the word as defined in the code is a continuation of the definition in one of the 13 acts, but in certain cases the same has been modified and hence has implications of applicability.

Section 2 (g): In ??uilding or other construction work??the definition specifies that it does not include any building or other construction work of any factory or mine or any building or other construction work employing less than ten workers.

Section 2 (u): The term ??stablishment??has been defined as a place where any industry, trade, business, manufacture or occupation is carried on in which ten or more workers are employed; or a factory, motor transport undertaking, newspaper establishment, audio-video production, building and other construction work or plantation, in which ten or more workers are employed; or a mine or dock work. The word ??stablishment??is used in many of the sections

Section 2(zb)(b): The term ??ndustry??does not include domestic service.

Section 2(zo): The term Occupier has been modified compared to The Factories Act, 1948 and an independent director cannot be an occupier.

Section 2(zz): The term ??ales promotion employees ??efinition does not include apprentices as specified in The Sales Promotion Employees (Conditions of Service) Act, 1976;

Section 8 specifies duties of manufacturers, designer, importers or suppliers and holds them responsible for the safety of the equipment and material designed, imported, supplied, erected, installed as to be safe and without risk to the health of the workers when properly used. There are details specified which were not covered in the existing legislations.

Section 9 in detail specifies the duties of architects, project engineers and designers and holds them responsible for ensuring that they have considered all aspects of safety and health for the workers that are carrying out the construction, but to also take into account the safety aspects associated with the maintenance and upkeep of the structures and buildings where maintenance and upkeep may involve special hazards.

Section 12: (1) and 12(2) deal with notice of certain diseases and these sections are identical to section 89 and 90 of The Factories Act, 1948 except the word factory has been replaced by the word establishment. Also, the Schedule Three specifying list of notifiable diseases is identical to the schedule three in The Factories Act, 1948.

Sectior 16 and 17 deal with constituting a National Occupational Safety and Health Advisory Board and State Occupational Safety and Health Advisory Board which is something new compared to the present legislation. Section 18 deals with occupational safety and health standards and the second schedule is a very exhaustive list covering list of matters to be covered in factories, mines, ports, construction, offices, plantation and others. The second schedule under section 41-F of The Factories Act, 1948 which dealt with permissible limits of 116 chemical substances is not to be found in the second schedule of the code and since the schedule mentions that ??he Central Government shall declare, by notification, standards on occupational safety and health for work places relating to factories, mines, dock work, building and other construction work and other establishments ??robably these will be specified later .

Section 21 deals with an effective programme of collection, compilation and analysis of occupational safety and health statistics.

Section 22 deals with Safety Committee and safety officers in establishments.

Section 24 deals with welfare facilities in the establishment and in subsection (2) specifies bathing places and locker rooms for male, female and transgender employees separately. This is a recognition of accepting the employment of transgender employees at the work place.

Section 25 deals with weekly and daily working hours, leave, etc. and since the Code also covers sales promotion employees. It is silent on the working hours of sales promotion employees but specifically in sub – section (3) in detail specifies the leave benefits. It has to be seen how this will get interpreted, as sales promotion employees have to work when they can meet the doctors and the eight hours working per day cannot be from 9 am to 5 pm like the general shift of establishments.

Section 37 provides for a third-party audit and certification for start-up establishments and class of other establishments to get the same done and submit their reports to the concerned employer and Inspector-cum-Facilitator separately for the purpose of ensuring compliance of the provisions of this Code.

Section 43 provides for women to work in with her consent, to be employed in an establishment before 6 a.m. and beyond 7 pm.

Section 45 to 62 deal with contract Labour and Inter State Migrant worker, as both these Acts have been merged with this code.

Section 50 (1) states that when a contractor receives work order from an establishment, he has to intimate the same to the appropriate Government.

Section 60(1) the contractor to every inter-State migrant worker at the time of recruitment, has to pay a displacement allowance equal to fifty per cent of the monthly wages payable to him which was already there in the existing act.

Section 73 states that a person who is deaf or has a defective vision or has a tendency to giddiness be not employed in building or other construction work which is likely to involve a risk of any accident either to the building worker himself or to any other person. This is keeping safety in mind.

Section 75 deals with premises or buildings leased to different occupiers for use as separate factories, the owner of the premises and occupiers of the factories utilising such common facilities include safety and fire prevention and protection, shall jointly be responsible for providing maintenance of common facilities and services as may be prescribed.

Section 83 deals with maximum limit of exposure of chemical and toxic substances in manufacturing process in any factory. Earlier these limits were specified in Schedule Two of The Factories 1947. Act, Under the code these are not specified and it is mentioned that the limits of exposure of chemical and toxic substances in manufacturing process in any factory will be decided by the State Government.

Section 87 deals with general penalty which shall not be less than Rs 2 lakh to the employer of any establishment for the contravention of the code.

Section 96 (1) deals with a dangerous occurrence resulting in (a) death, then the person responsible shall be punishable with an imprisonment for a term which may extend to two years or with a fine which shall not be less than Rs five lakh or with both.

Section 107 (1) deals with compounding of offence and its procedure.

However, this compounding is only applicable for offence in which the punishment does not involve imprisonment.

Conclusion

The Code is an effort by the Ministry of Labour & Employment, Government of India at combining 13 labour laws which not only dealt with safety, health and working conditions plus other areas relevant to the workers employed in factories, mines, docks, building and construction, plantation, motor transport, beedi and cigar, cine and cinema theatre, journalism, field force, plus the contract workers and interstate migrant workers.

Presently a large number of enterprises are engaging contract labour through contractors/ service providers under the existing Contract Labour (Regulation and Abolition) Act, 1970. It is to be seen how the proposed code will impact the employers, contractors and contract workers once the Rules to the Occupational Safety, Health and Working Conditions Code, 2019 are released.

There are techniques such as ??ontrolled Implosion??which can be used for swift demolition of structures and there was need that these from the point of occupational safety and health should have been included in the Code , Also new forms of employment based on App Platforms that have entered the business area have not been dealt with, as we need to also look at their occupational safety, health and working conditions

Since the code subsumes 13 labour laws the terminology of enterprise is used in most sections. Since this code is going to replace legislations of 1948 and later, it is too early to predict how this legislation will help the workers, trade unions and employers associated with enterprises in India in ensuring occupational safety and improved health. The acid test on the clarity of a legislation comes with judicial interpretations.

ABOUT THE AUTHOR:

Dr Rajen Mehrotra is past President of Industrial Relations Institute of India (IRII), Former Senior Employers??Specialist for South Asian Region with Internation.al Labour Organization (ILO) and Former Corporate Head of HR with ACC, and Former Corporate Head of Manufacturing and HR with Novartis India Ltd. Email: rajenmehrotra@gmail.com

Concrete

Indian Cement Industry Sees Further Consolidation

Cement industry to face consolidation soon.

Published

3 days ago

September 13, 2024

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India’s cement sector is set for further consolidation in the near-to-medium term, according to a recent report. With increasing competition, rising input costs, and the need for economies of scale, companies are expected to explore mergers and acquisitions (M&A) to strengthen their market positions. As the industry faces various challenges, including high energy costs and fluctuating demand, consolidation is viewed as a strategic move to drive growth and sustainability.

Key Points:
Market Consolidation: The Indian cement industry has already witnessed significant consolidation over the past few years, with several large firms acquiring smaller players to enhance their market share. The trend is expected to continue, driven by the need to optimize operations, cut costs, and gain better pricing power. Consolidation helps companies to expand their geographic reach and strengthen their portfolios.

Rising Costs and Challenges: One of the primary drivers of consolidation is the rising cost of inputs, particularly energy and raw materials. With costs of coal and petroleum coke (key energy sources for cement production) soaring, companies are looking for ways to maintain profitability. Smaller and medium-sized players, in particular, find it challenging to cope with these rising costs, making them more likely targets for acquisition by larger companies.

Economies of Scale: Larger cement companies benefit from economies of scale, which help them absorb the impact of rising input costs more effectively. Consolidation allows firms to streamline production processes, reduce operational inefficiencies, and invest in advanced technologies that improve productivity. These efficiencies become critical in maintaining competitiveness in an increasingly challenging environment.

M&A Activity: The report highlights the potential for more mergers and acquisitions in the cement sector, particularly among mid-sized and regional players. The Indian cement market, which is highly fragmented, presents numerous opportunities for larger companies to acquire smaller firms and gain a foothold in new markets. M&A activity is expected to accelerate as firms seek growth through strategic alliances and acquisitions.

Regional Focus: Consolidation efforts are likely to be regionally focused, with companies looking to expand their presence in specific geographic areas where demand for cement is strong. Infrastructure development, government projects, and urbanization are driving demand in various parts of the country, making regional expansions an attractive proposition for firms looking to grow.

Impact on Competition: While consolidation may lead to a more concentrated market, it could also intensify competition among the remaining players. Larger firms with more resources and market reach could dominate pricing strategies and influence market dynamics. Smaller firms may either merge or struggle to compete, leading to a reshaping of the competitive landscape.

Demand Outlook: The near-term outlook for the cement industry remains uncertain, with demand being influenced by factors such as construction activity, infrastructure projects, and government initiatives. The report notes that while urban demand is expected to remain stable, rural demand continues to face challenges due to slow construction activities in those areas. However, the long-term outlook remains positive, driven by ongoing infrastructure developments and real estate projects.

Sustainability Focus: Companies are also focusing on sustainability and environmental concerns. Consolidation can provide larger companies with the resources to invest in green technologies and reduce their carbon footprint. This focus on sustainability is becoming increasingly important, with both government regulations and market preferences shifting toward greener production practices.

Conclusion:
The Indian cement industry is poised for further consolidation in the coming years, driven by rising costs, competitive pressures, and the need for economies of scale. M&A activity is likely to accelerate, with larger firms targeting smaller and regional players to strengthen their market presence. While consolidation offers opportunities for growth and efficiency, it could also reshape the competitive landscape and influence pricing dynamics in the sector.

Concrete

Cement Companies May Roll Back Hike

Cement firms reconsider September price increase.

Published

3 days ago

September 13, 2024

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Cement companies in India might be forced to reverse the price hikes implemented in September due to weakened demand and pressure from competitive market conditions, according to a report by Nuvama Institutional Equities. The recent price increase, which was expected to improve margins, may not hold as demand falls short of expectations.

Key Points:
Price Hike in September: Cement firms across India increased prices in September, aiming to improve their margins amidst rising input costs. This was seen as a strategic move to stabilize earnings as they were grappling with inflationary pressures on raw materials like coal and pet coke.

Weak Demand and Pressure: However, demand has not surged as expected. In some regions, particularly rural areas, construction activity remains low, which has contributed to the tepid demand for cement. The combination of high prices and low demand may make it difficult for companies to maintain the elevated price levels.

Competitive Market Forces: Cement manufacturers are also under pressure from competitors. Smaller players may keep prices lower to attract buyers, forcing larger companies to consider rolling back the September hikes. The competitive dynamics in regions like South India, where smaller firms are prevalent, are likely to impact larger companies’ pricing strategies.

Nuvama Report Insights: Nuvama Institutional Equities has highlighted that the September price hikes may not be sustainable given current market conditions. According to the report, the demand-supply imbalance and weak construction activities across many states could push cement companies to reconsider their pricing strategies.

Impact on Margins: If companies are compelled to roll back the price hikes, it could hurt their profit margins in the near term. Cement firms had hoped to recover some of their input costs through the price increases, but the competitive landscape and slow demand recovery could negate these gains.

Regional Variations: Price rollback might not be uniform across the country. In regions where infrastructure development is picking up pace, cement prices may hold. Urban areas with ongoing real estate projects and government infrastructure initiatives could see a sustained demand, making price hikes more viable.

Future Outlook: The outlook for the cement sector will largely depend on the pace of recovery in construction activity, particularly in the housing and infrastructure sectors. Any significant recovery in rural demand, which is currently subdued, could also influence whether the price hikes will remain or be rolled back.

Strategic Adjustments: Cement firms may need to adopt a cautious approach in the near term, balancing between maintaining market share and protecting margins. Price adjustments in response to market conditions could become more frequent as companies try to adapt to the fluctuating demand.

Conclusion:
The September price hikes by cement companies may face reversal due to weak demand, competitive pressures, and market dynamics. Nuvama’s report signals that while the increase was aimed at margin recovery, it may not be sustainable, particularly in regions with low demand. The future of cement pricing will depend on construction sector recovery and regional market conditions.

Concrete

Bridge Collapse Spurs Focus on Stainless Steel

Climate change prompts stainless steel push.

Published

3 days ago

September 13, 2024

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The Ministry of Road Transport and Highways (MoRTH) is turning its attention to the use of stainless steel in bridge construction to counteract corrosion, an increasing issue linked to climate change. With recent bridge collapses highlighting the vulnerability of existing infrastructure to corrosion and extreme weather events, the ministry is promoting the adoption of durable materials like stainless steel to ensure the longevity and safety of India’s critical transport infrastructure.

Key Points:

Bridge Collapse and Climate Change: Recent incidents of bridge collapses across the country have raised alarm over the durability of current construction materials, with corrosion cited as a leading cause. Climate change, leading to harsher weather patterns and increased moisture levels, has accelerated the deterioration of key infrastructure. This has prompted MoRTH to consider long-term solutions to combat these challenges.

Corrosion: A Growing Concern: Corrosion of structural materials has become a serious issue, particularly in coastal and high-moisture regions. The Ministry has identified the need for a more resilient approach, emphasizing the use of stainless steel, known for its resistance to corrosion. This shift is seen as crucial in ensuring the longevity of India’s bridges and reducing maintenance costs over time.

Stainless Steel for Bridge Construction: Stainless steel, while more expensive initially, offers long-term savings due to its durability and resistance to environmental factors like moisture and salt. The Ministry is advocating for the material’s use in future bridge projects, particularly in areas prone to corrosion. Stainless steel is seen as a solution that can withstand the pressures of both natural elements and increasing traffic loads.

Government’s Proactive Steps: The government, through MoRTH, has started consulting with experts in the field of metallurgy and civil engineering to explore the expanded use of stainless steel. They are considering updates to construction standards and specifications to incorporate this material in new and rehabilitated infrastructure projects.

Economic Considerations: Although the initial investment in stainless steel may be higher than conventional materials, the reduced need for repairs and replacements makes it a cost-effective option in the long run. This approach also aligns with the government’s push for sustainable infrastructure that can withstand the test of time and climate change effects.

Future of Indian Infrastructure: With the push for stronger, more durable infrastructure, the Ministry’s move to adopt stainless steel for bridge construction marks a shift towards building climate-resilient structures. The use of this material is expected to not only enhance the safety and longevity of bridges but also reduce the financial burden on the government for constant repairs.

Industry Perspective: The stainless steel industry sees this shift as an opportunity to expand its market, particularly in the infrastructure sector. Stakeholders are engaging with the government to demonstrate the benefits of stainless steel, advocating for its increased use not just in bridges but across various infrastructure projects.

Conclusion: In response to the growing threat of climate change and its impact on infrastructure, the Ministry of Road Transport and Highways is prioritizing the use of stainless steel in bridge construction to combat corrosion and ensure the long-term durability of critical transport structures.