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A Note on Labour Laws Applicable to Private Hospitals and Nursing Homes
The following Labour Laws are applicable to private Hospitals:-
A. To all hospitals and nursing homes -
I. The Minimum Wages Act:
This is the important law, which governs the wages, working hours, weekly offs etc., in a private hospital/nursing home.
Details are as under:
a. Wages:
Minimum wages are fixed from time to time for different categories of employees. The wages consist of basic wages which are fixed and special Allowance which vary every six months - in January and July depending on variation in consumers price index numbers. The varying special Allowance is published at the end of Feb/July every year by the office of the Labor Commissioner. The following table gives the present basic wages.
Class of Employees |
Basic Wages per month |
|
---|---|---|
I | Sweepers, Ward-boys, ayahs, all of whom are not provided with residential quarters and peons, X-ray boys, ward servants, cook-mates, kitchen mates, servants etc., |
Rs. 4460 + D.A. |
II | Semi Skilled |
Rs. 4560 + D.A. |
III | Qualified Nurses, Technicians |
Rs. 4660 + D.A. |
b. Special Allowance:
In addition to the above basic wages, all employees are entitled to special Allowance (a sort of Dearness Allowance This Special Allowance varies every six months, as it depend on the Consumers Price Index Numbers. The Special Allowance calculated by the Office of the Commissioner of Labor published at the end of February and July every year and effective from January to June and July to December of the year. DA effective from August 2008 is Rs. 701.10/-
c. Permissible Deduction from Wages:
As per Government Notification, dated 19.7.1972, cash values at the below mentioned amounts can be deducted from the monthly wages of employees:
When one meal is served daily
When one nasta is served daily
When all meals are served daily
The sums denote cash - value of respective items of month.
d. Wages for Part Time workers:
The wages are fixed by month. To arrive at the daily rate, the wages for the month are to be divided by 26 (and not 30 or 31). The wages are paid for full day's work or full month's work. A normal day's work, under law, is 8 hours work. Hence the law stipulates, that if a full time employee is not given work for an hour or two in a day, he is entitled for full wages on that day as per contract of service. This is so as it is not his fault, that he does not get full work. But an employee, can be appointed as a part time employee stipulating in the appointment letter, the number of hours he has to work daily. In such a case, he can be paid proportionate minimum wages. For instance, if an employee is employed, to work for four or five hours a day, he is to be paid 40% or 62
e. Work Category:
If an employee in a lower category is made to work in a higher category, then he will have to be paid wages of the higher category for the time, he works in higher category. The visa-versa is not true. A general helper, or a peon, can be trained as Dresser and may be assigned both work, provided, he is paid higher wages of Dresser and may be assigned both work, provided, he is paid higher wages of Dresser for the hours he works as a Dresser.
f. Weekly day of rest:
i. An employee shall not be allowed to work for more than 5 hours, without having a rest of at least half an hour normally one hour's. Rest is provided in all establishments except factories which work in shifts.
ii. Spread over:
The spread over of work in a day should not exceed twelve hours. That is the period of an employee inclusive of rest interval shall not spread over more than twelve hours in the day. This normal spread over 9-12 hours is not applicable in cases of urgent work to be put in by an employee in case of emergency. But for the time the spread over hours exceed, over time wages will have to be paid.
iii. Arrangement of work:
The working hours of an employee may start at 8.00 a.m. and may close at 8.00 p.m., provided his actual working hours do not exceed eight. One illustrative arrangement is as follows:
Reporting to work: 8 a.m.
Break: 1 p.m. to 5 p.m.
Next reporting time: 5 p.m. to 8 p.m.
The working hours may be suitably arranged, by the employer, subject to the condition that any work over 8 hours in the day attracts over time payment. As stated above, exceeding the normal limit of spread over of 12 hours will also attract over time wages.
h. Over-time wages:
Any work beyond 8 hours in a day and 48 hours in a week attracts over-time wages at double the normal wage rates. Normal hourly rate is to be calculated as under:
i. Annual/Earned/Privilege Leave:
II. Bombay Shops and Establishments Act, 1948:
The said Act was made applicable to Hospitals by issuing notification under Section 5 of the Act. The High Court of Bombay, however, held in the case of Mahalaxmi Nursing Home that the said notification was bad in bad in law. Hence the impression is that the Shops Act is not applicable to the private hospitals. But in 1977 the Government has amended the definition of "Commercial Establishment" to include establishments of medical practitioners. A view can therefore be taken that the private hospitals, just like Dispensaries, are establishments of Medical Practitioners and as such they are amendable to the provisions of Shops and Establishments Act. This point is not, however, tested as yet in any Court of Law. There is no difference, however, between the provisions of the Minimum Wages Act and the Shops and Establishments Act so far as weekly offs, weekly hours, daily hours, rest hours etc. are concerned. No contravention of the provisions of the Shops Act can, therefore, be alleged when the Minimum Wages Act is strictly followed except that the hospitals are not registered under the shops Act. I personally feel that the private hospitals should be registered under the shops and Establishments Act.
III. Industrial Disputes Act 1947:
This Act is applicable to all employers including Private Hospitals. The Act provides for settlement of Industrial Disputes between employer and his work-men. The Disputes are of two types:
I. Collective Disputes:
There are disputes relating to all employees. Demands for better wages and working conditions for all employees can be made by unions of workmen. If demands are not settled by mutual negotiations, they are referred by the union to the office of Labour Commissioner for conciliation. If there is no settlement in conciliation, then the dispute may be referred to Industrial Court by the Government. The Award of the Court after hearing both the parties is final and binding on both the parties. Such collective disputes are few in small establishments.
II. Individual Disputes:
These disputes relate to discharge of individual employees. Often an employer has to take recourse to disciplinary action against erring employees. Many a time the services of an employee are terminated orally or otherwise on grounds that he was temporary his work was unsatisfactory etc. Such incidents are not uncommon but unless proper procedure is followed or proper case is taken. Such actions lead to individual disputes and may prove costly ultimately. Whether an establishment is small or not law and recent decisions of High Court and Supreme Court are very much favorable to the labour in cases of terminations of service, discharges etc. as the employees are reinstated with full back wages.
It is not possible to give in details all the precautions to be taken. But some points may be noted:
IV. The Payment of Gratuity Act:
This Act applies to all establishments in which 20 or more employees are employed. The Act makes provision for payment of gratuity to an employee at the rate of 15 days wages per year of service if the employee resigns or his services are terminated provided he has put in at least 5 years continuous service. In all such cases the expert advice may be taken for settlement of gratuity.
V. The Employees Provident Funds Act, 1952:
This Act applies to private hospitals employing 10 or more employees. Under the Act the employer is obliged to register with the office of Provident Commissioner, take a Code Number and enroll his employees with at least 120 days service as Subscriber to Provident Fund. The employer has to pay his contribution of 6
VI. Payment of Bonus Act; 1965:
This Act is applicable to an establishment employing 10 or more employees. Even though Charitable Hospitals not established for profits are exempted from the Act; other hospitals would be covered by the Act. The minimum bonus payable under the Act is 8.33% of the earnings of an employee in the accounting year of the establishment whether it has made profits or not. The maximum bonus payable is 20% of such earnings of employees. The general bonus payable between 8.33% and 20% depends on the net profit of the establishment and available surplus calculated as per the formula prescribed under the Act. In cases of payment of bonus, the employers covered by the Act, should consult the Labour Adviser.