Labour Law in India: Need, Objectives, Principles, Classification

  • Post last modified:29 May 2023
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  • Post category:Business Law
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Labour Law in India

The term ‘Labour Legislation’ is used to cover all the laws which have been enacted to deal with” employment and non-employment” wages, working conditions, industrial relations, social security and welfare of persons employed in industries.

The term ‘labour legislation’ is in India; is treated as an arm of the State for the regulation of working and living conditions of workers. Organized industry in a planned economy calls for the spirit of co-operation and mutual dependence for attaining the common purpose of greater, better and cheaper production. Since this has not been happening voluntarily, the need was for State intervention.

Need for Labour Legislation in India

The need for labour legislation may be summarized as under :

  • Necessary for the health, safety, and welfare of workers;
  • Necessary to protect workers against oppressive terms as individual
  • Worker is economically weak and has little bargaining power;
  • To encourage and facilitate the workers in the organization;
  • To deal with industrial disputes;
  • To enforce social insurance and labour welfare schemes.

Objectives of Labour Law

The objectives of labour legislations are two-fold:

  • Preservation of the health, safety and welfare of workers; and
  • Maintenance of good relations between employers and employees

Principles of Labour Legislation

  1. Social Justice
  2. Social Equity
  3. National Economy
  4. International Uniformity
Principles of Labour Legislation
Principles of Labour Legislation

Social Justice

  • The essence of democracy is ensuring social justice to all sections of the community.

  • This demands the protection of those who cannot protect themselves.

  • In modern industrial set-up, workers, left to themselves, are unable to protect their interest Therefore, the State has to intervene to help them by granting them freedom of association, the power of collective bargaining and by providing for mediation or arbitration in the case of industrial conflict.

Social Equity

  • Legislation based on this principle provides for achievement of definite standards. Standards in terms of living, position in society etc. of the working population.

  • These standards for the working class can be achieved by bringing about changes in the Law of our land.

  • Power to change the Law is exercised by the government.

  • Existing laws may be amended to meet the changed standards.

National Economy

Measures have to be provided through legislation to:

  • Ensure normal growth of industry for the benefit of the nation as a whole; Satisfy the physical and intellectual needs of the citizens;

  • Ensure the growth of industrial efficiency such as to adjust the wage system with a view to increase the productivity and prosperity of the workers.

International Uniformity

  • Since its inception, securing minimum standards (for the working population – worldwide) on a uniform basis in respect of all labour matters has been the main objective of ILO.

  • To this end, conventions are passed at the conferences of ILO.

  • As a member of the ILO, adopting these conventions would require appropriate legislation to be brought about.

  • The influence of International labour conventions has been significant in shaping the course of labour legislation in India.

Classification of Labour Laws

The various labour legislations can be classified in a number of ways depending upon the object of study. For example, they can be classified on any one of the following arbitrary bases:

  1. Purpose
  2. Legislature
  3. Period of Enactment


  • Regulation of working conditions (terms of employment, procedure for employment, safety + health+ welfare requirements)
  • Social security (protection against loss in earning and risks)
  • Regulation of wages and bonus
  • Industrial relations and conflict prevention


Central or state or both.

Period of Enactment

Early days, pre-Independence, post-Independence

The National Labour Commission (Second), in its report has also discussed the labour laws under the following classifications:

  • Employment Relations
  • Contract Labour
  • Laws on working conditions and welfare
  • Laws Relation to wages
  • Laws Relating to Social Security
  • Miscellaneous Matters

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Business Law Book References

  1. Goel, P. K. (2006). “Business Law for Managers” Wiley
  2. Sheth, T. (2017). “Business Law” (2ed.) Pearson.
  3. Kuchhal. M.C. & Prakash. “Business Legislation for Management” (2ed.) Vikas Publishing.

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