A Project Report Submitted in Partial Fulfillment of the Requirements

A project report submitted in partial fulfillment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

To

INTERNATIONAL INSTITUTE OF PLANNING AND MANAGEMENT

BANGALORE

Submitted by

Caleb Joel Peter

Sandeep Sreekumar

Priyanka R.

Satish Ramchandran

Somnath Ray

Prithwiraj Deb

SPRING SUMMER 2008-2010

INTERNATIONAL INSTITUTE OF PLANNING AND MANAGEMENT

419, 4th Block, 100 ft Road, Kormangala, Bangalore-34

(2009)

ACKNOWLEDGEMENT

We would like to express our heartiest gratitude to Mr. Ashish Kumar (Regional

Head) Macpi Group India, for given us an opportunity to associate ourselves

with Macpi Group of industries.

We also express our gratitude to the administration and the academics

department at IIPM for giving us the opportunity to work on this project.

But most importantly, we would like to thank Professor Duggal for guiding us and

giving sound concepts which helped us in writing for this project.

Caleb Joel Peter

Sandeep Sreekumar

Priyanka R.

Satish Ramchandran

Somnath Ray

Prithwiraj Deb

Index

1. Company Profile

Macpi Group International Mission Products Macpi India

2. Laws- How they affect a business?

3. Particular Laws that Affect A Business

4. Contract Law

5. Patent Trademark act

6. Payment of wages act

7. Payment of min. wages act

8. Gratuity act

9. Work Benefit Compensation

10. Trade Union

11. Employee Provident Fund

12. Industrial Disputes

13. Maternity Benefits

14. Payment of bonus

15. Contract payment

16. Conclusion

Macpi Group Inc.

Macpi Group Inc. is basically an Italian company with functions in various diverse fields ranging from hospitality to pressing field to garment manufacturing to garment retailing to manufacturing machines used in making of garments however its main revenue comes from the garment industry. Macpi spa Pressing Division has been operating since 1961 thanks to the enterprise of two young friends – Giovanni Cartabbia and Luciano Sardini – who decided to join together to reach the ambitious target to establish a new dynamic reality, enabling the Macpi name to lead the field of the clothing industry. A great challenge for an important project. 

Presently Macpi brand is well-known on an international scale. It is a company leader in the pressing field and not only and has developed new revolutionary pressing techniques, greatly improving one of the most complicated stage of garment production.

The continuous attention to the needs and tendencies of the market, combined with the strong tradition of design and manufacturing, have led Macpi spa Pressing Division to produce very high-tech machines with a constant technical and commercial development throughout time. CAD systems and design sector of the company are the expression of the high quality which has been always been pursued as the principal target. A real example is represented by the matching and drilling of the pressing bucks, very delicate operations performed now with fully automatic robots which ensure the highest quality standards.

Product quality and efficiency in serving the customers’ needs have been the key-points of the success of this project which has made progress day by day constantly developing new ideas by using the latest technology and the highest sophistication for the management of the working stages, with the aim to make products of best quality and reliability.

40 years of activity for a brilliant realization, made possible thanks to winning partnerships and a comprehensive after-sales service, important markets acquisitions and a well-organized sales network make the Macpi spa Pressing Division a company leader in the world.

The Company Headquarter is in Italy and it has its offices in many countries in the world. The mail base of operation is Europe and South-East Asia, although it has its operation in most part of the world.

The organisation structure is like; --------

Chairman-Functional Heads( Sales,Technical,Operation,Finance & Personnel)Area Incharge( like Incharge-Europe, Incharge- southeast Asia, Middle east, US) Country Head.

Mission

A Customer’s culture

Macpi philosophy has been always centered around the Customer and consequently around the efficiency of after-sales service.

Macpi has always distinguished itself for the continuous co-operation with the final user; a constant collaboration which has given the right starting point for every day study and design of new products.

With this premise in mind Macpi spa Pressing Division has made several investments in the creation of permanent establishments based directly on site in order to follow in the best way the needs and the problems of the customers.

Maintenance and service have been the key components afforded to the success of Macpi spa Pressing Division, actually the main target has always been the quality of the service offered to the customers which means assisting them at all levels, especially after a sale; from the training of personnel through to the structure and spare parts facilities.

Macpi philosophy throughout these years of dedication to its customers has permitted the MACPI name to expand worldwide into a leading position now and the foreseeable future.

Products

Macpi International has products ranging in three main sectors-

1. Garments - Mainly machineries used in manufacturing of garments such as shirts, jackets, underwear, skirts, knitwear, trousers, sportswear and linen.

2. HHC - Mainly Community Halls and Rest Homes.3. Bonding - Bonding as in bonding of materials.

Macpi India

Macpi Group started its operations in India 16 years back through its Agent M/S. E.H.Turel & Co. who has their offices in Bangalore, Delhi, Mumbai, Hyderabad, Tirupur, Chennai, Kolkata, Ludhiana and Jaipur.

Macpi set up its own office, Macpi Trading India Pvt. Ltd. in Bangalore in the year 2005 and now we have three offices in India- Bangalore, New Delhi and Mumbai. Now Macpi is doing both primary sales (through its own staffs) & secondary sales (through its agent) in India but as a they don’t have an office in Bangladesh (BD) so they depend on only secondary sales in BD. The India office takes care of the BB market. In BD, Macpi Group has two agents- M/S. Pacific Associates Ltd and M/S. Gar-tech Technology.

The hierarchy in India or as in any other country is----

Country Manager Regional Head (north hear & south Head) Sales Executives.

From Service/Technical side,

Country Manager Regional Service Head (north & south) Service Engineers.

Laws- How they affect a business ?

It is important for all business owners to know and understand the laws that affect their businesses. It is equally important to comply with those laws. Ignorance of the laws has never been a valid excuse in any Court of Law, and it never will be. As a business owner, it is the responsibility of the firm in business to know what laws affect the business. 

Since every business, in every state, in every country is different, the laws that affect one business may be different than the laws that affect other businesses. Likewise the same business may function differently in different countries according to the laws prevailing in that country. For that reason, it is impossible to give an account of all laws that affect all businesses. One needs to find out what laws affect ones business.

Here are some of the categories of laws with which a firm should familiarize itself with for better running of the business.

Employment Laws, includes laws regarding: hiring and firing of employees, overtime pay, child-labor, disability, worker’s compensation, unemployment, employee rights, employee safety and discrimination.

Tax laws including laws pertaining to the filing of tax returns and payment of: sales tax, withholding taxes, corporate taxes, pass through taxes and both state and local taxes.

Environmental laws, including recycling laws and the discharge of hazardous waste materials

Trademark and patent laws, plus all other such laws pertaining to ownership, inventions and/or intellectual property rights.

Consumer protection laws against fraud or unfair business or advertising practices.

Zoning laws, which typically include local ordinances that regulate: parking, advertising and signage use of the land surrounding the business and even the type of business that is allowed to be conducted in a specific area.

Business formation laws including those pertaining to the specific business structure the firm has selected.

If the business is a sole-proprietor business one need not have to familiarize oneself with employee laws until one is ready to hire additional staffers. Likewise, if one is in a service business, one typically won’t need to familiarize oneself with removal of hazardous waste. Review applicable laws in advance for each aspect of one’s business as one sees it unfolding. Also, review of all potential significant legal matters with one’s attorney is of utmost importance.

If one finds oneself in violation of a law, one should take immediate steps to rectify the situation. Depending on the severity of the law, one may only receive a warning or a small fine from the local authorities. Typically, one will be given a time frame in which to make the appropriate corrections.

Zoning laws can often frustrate a new business owner. While one may be legally allowed to open a specific type of business in the zoned area, one will often discover that these laws affect how one may conduct one’s business.

It is important to take some time to familiarize oneself with all municipal, commercial and/or industrial zoning laws that could pertain to one’s business and ask questions of the local Chamber of Commerce and/or other business owners to make sure one is adhering to the details.

Particular Laws that Affect A Business-

Contract Act.

Indian Context-

THE INDIAN CONTRACT ACT, 1872

Indian Contract Act 1872 is the main source of law regulating contracts in Indian law, as subsequently amended.

Section 2(h) of the Act defines the term contract "as an agreement enforceable by law".

Section 2(e) defines agreement as "every promise and every set of promises, forming the consideration for each other". Again Section 2(b) defines promise in these words:"when the person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. Proposal when accepted becomes a promise".

Section 2(j) defines void contract as "a contract which ceases to be enforceable by law becomes void when it ceases to be enforceable".

The Essential Elements of a Valid Contract---

1. Proper offer and proper acceptance2. Lawful Consideration3. Capacity4. Free Consent5. Lawful Object and Agreement

Italian Context-

Italy has a civil law system. The basic rules governing contractual relationships are embodied in the Italian Civil Code which was enacted in 1942. Article 25 of the Preliminary Provisions sets forth three criteria to determine the law governing a contractual relationship: nationality, place of formation, and agreement of the parties.

The first criterion is used for contracts executed by parties sharing the same nationality. In this case, the law governing the contract is that of the country of shared nationality. The second criterion refers to the place of formation of the contract and is used when a contract is entered into by parties of differing nationalities. Both of these criteria may be superseded by an agreement between the parties as to the governing law. However, there should be a logical connection between their choice of law and the transaction, especially with parties sharing the same nationality.

The parties to a contract may, indirectly, determine the law which will govern the formation of a contract. Article 26 of the Preliminary Provisions states that the formation of an instrument, whether or not contractual, is governed by the law of the place where the instrument is formed or, alternatively, by the law that govern the substance of the instrument. Thus, the parties may apply their choice of law with respect to the substance of the agreement to determine the validity of the formation of the contract.

The Italian Code of Civil Procedure does not provide parties with as much flexibility with respect to the choice of forum. The parties to a contract may avoid the jurisdiction of the Italian courts and submit a contractual dispute to a court of the jurisdiction of their choice only if the parties are non-Italians or, in the event one of the parties is Italian, if this party is neither a resident of, nor domiciled in Italy (Article 2 of the Italian Code of Civil Procedure).

One of the basic principles of Italian contract law is that of leaving the parties free to govern their economic relationship. The Civil Code contains provisions governing general contract principles and also provides for specific types of agreements including sales contracts, agency agreements, lease contracts, loan agreements, and insurance agreements.

Verdict- the Indian contract Act is much rigid compared to its Italian counterpart. According to Mr. Ashish Kumar, Country Head, Macpi India, where the Italian context offers more flexibility in doing one’s business the Indian Law provides much more protection.

Patent and Trademark Act.

Indian Context

Both the Patent and Trademark Act comes under The Intellectual Property Rights Act. Though broadly they are referred to as one, Patent refers to i) exclusive right to use invention patented. ii) To grant Licenses to others. iii) To sell that right. Whereas Trademark refers to i) exclusive right to use mark in relation to a product of service ii) prevents others from using it.

Patent act

SALIENT FEATURES OF THE PATENTS ACT, 1970

-An Act to amend and consolidate the Law relating to Patents

1. The Indian Patents and Designs Act, 1911

2. Patents Enquiry Committee - Report in 1950 - Patents Bill, 1953 - Lapsed with dissolution of 1st Lok Sabha - based on United Kingdom Patents Act, 1949

3. The Patents Bill, 1965 - Sri. Justice N. Rajagopala Ayyangar Report, 1959 - Joint Committee of Parliament - Lapsed on dissolution of 3rd Lok Sabha

4. The Patents Act, 1970 - from 20.04.1972

5. 1999 Amendment - To keep it in tune with trade related aspects of Intellectual Property rights (Trips) entered into by WTO and to provide for Public Interest, National Security, Bio-diversity, Traditional Knowledge, Procedure for grant of Patents

EXTANT - Extends to the whole of India

ENFORCEABILITY - 20.04.1972

Trademarks act

In view of the recent developments in trading and commercial practices and to give effect to important judicial pronouncements, a need for simplification and harmonization of trademark management systems was felt. The new Trade Marks Act, 1999, which came into force in September 2003, is the result of this realization.

The new legal definition of a trade mark under the Act consists of the shape of goods, packaging or combination of colors or any combination thereof. A package is now protected under the Act,

which includes any case, box container, receptacle, vessel, casket, bottle, wrapper, label, band, ticket, reel, frame, capsule, cap, lid, stopper, and cork. Thus, the new definition of trademark in India broadly encompasses almost all the elements of trade dress under the US law.

Under the Indian trademark law, any distinctive and identifying mark, which is capable of distinguishing the goods and services of one owner from that of another, may be utilized as Trademark and such marks are afforded protection under the law. The Trade Marks Act, 1999 is a reproduction of the UK’s Trade Marks Act 1994 as India follows the English Trade Mark laws from the beginning.

Italian Context

Italy’s protection of intellectual property lacks behind that of many western countries and despite Italian govt. strives to improve protection this remain a concern for companies doing business in Italy. Since the inception in 1989 of the Special 301 review process identifying countries where intellectual property right infringement represents a barrier to trade, the United States Trade Representative (USTR) has consistently listed Italy on its Special 301 Watch List or Priority Watch List. The industries most affected by intellectual property right infringement in Italy include music, film, software, publishing, fashion, and pharmaceuticals. The International Intellectual Property Alliance (IIPA) estimated 2006 trade losses in excess of $1.4 billion due to copyright piracy alone in Italy.

In an effort to improve its track record, Italy has passed strong legislation aimed at curbing intellectual property rights (IPR) infringement. However, while the passage of legislation is an important step forward, many of the laws are not fully or effectively enforced. In particular, steep fines for the purchase of counterfeit goods and severe punishments for peer-to-peer file sharing are being challenged in the Italian courts.

Despite ongoing concerns about intellectual property protection, with the assistance of legal counsel companies will find the tools to protect their intellectual property available in Italy. Italy is a signatory of the Paris Convention (Trademarks & Patents), the Berne Convention (Copyrights), and the Patent Cooperation Treaty as well as a member of the World Intellectual Property Organization (WIPO) and World Trade Organization (WTO).The Italian Financial Police (Guardia di Finanza) enforce injunctions, carry out seizures and wage an ongoing battle against counterfeiting and piracy and the organized crime networks behind these activities.

Patents

A company can apply for international protection when filing for a patent at the United States Patent and Trademark Office by completing a Patent Cooperation Treaty (PCT) application for the countries in which patent protection is desired. Italy is among the signatories of this treaty.

The PCT is an international agreement designed to unify and simplify the measures to be followed by nationals or residents of one member country when filing patent applications in other member countries.

To register a patent solely in Italy, an application must be filed with the Italian Patent and Trademark Office (Ufficio Italiano Brevetti e Marchi Once a patent is granted, the term of protection is for a non-renewable period of 20 years. Patents are freely transferable but the relative assignment and any licenses must be registered with the Italian Patent and Trademark Office in order to be enforceable against third party infringers. Local Chambers of Commerce in Italy act as branch offices of the Italian Patent and Trademark Office for purposes of filing and processing applications.

In order to be approved, patent applications need to fulfill the requirements of novelty, utility, and inventive step. Italy and the rest of Europe apply the “first- to-file” principle, which grants the patent to the inventor who files for it first.

Trademarks act

Trademark protection is available for all new names, designs or symbols that identify a product in the market. Italian trademark law involves the principle of first to register. Italy, use a first to register system whereby the first person to register a trademark is granted ownership even if it is already in use (but unregistered) by another party. The trade of counterfeit goods, and, therefore, trademark infringement, is the IPR violation that is most keenly felt by Italian industry due to the number of famous “Made in Italy” fashion and leather brands that fall victim to counterfeiting. This is also the most visible IPR violation because of the pervasive presence of street vendors selling counterfeit products.

In the past, counterfeit goods were often made in Italy as part of the country’s vast underground economy, but recent years have seen a shift in favor of imported counterfeit goods, which are now prevalent on the Italian market.

To obtain trademark protection exclusively in Italy, trademarks should be registered with the Italian Patent and Trademark Office. After registration, protection is initially granted for a 10-year period but if properly maintained, trademarks are renewable indefinitely. Trademarks are freely transferable but assignments and licenses must be recorded with the Italian Patent and Trademark office in order to be enforceable against any third party infringement.

In addition to the protection granted through registration, even unregistered trademarks may be entitled to protection through principles of unfair competition and consumer protection. Well-known trademarks are protected in Italy from identical or confusingly similar trademarks, provided their use would cause unfair competition due to consumer confusion. This holds true even if used for entirely different services or goods. However, registration in Italy is advisable.

The Italian Financial Police, Guardia di Finanza, are responsible for seizure of products found to be in violation of Italian laws protecting trademarks.

Enforcement and Additional Assistance

Intellectual property protection is provided under Italy’s penal and civil codes. Under the penal code, Italy’s Finance Police, Guardia di Finanza, is responsible for IPR enforcement, and other law enforcement agencies such as the Carabinieri and the municipal police also play important roles. The Guardia di Finanza is authorized to seize any counterfeit or pirated goods. Legislation passed in 2005 established administrative fines ranging from 100 to 10,000 Euros for consumers caught purchasing or accepting counterfeit or pirated goods. This law is aimed at protecting goods “made in Italy.” Patent, trademark, and copyright owners can request Italian Customs Authorities to prevent goods in violation of IPR from entering the market through an injunction. Civil proceedings can take place separately or be added to a criminal trial. Lawsuits in Italy generally take many years and injunctive relief and damages can be requested during this time.

Payment of Wages Act

Indian Context

PAYMENT OF WAGES ACT, 1936[Act No. 4 of Year 1936]

The Payment of Wages Act, 1936 regulates payment of wages to employees (direct and indirect). The act is intended to be a remedy against unauthorized deductions made by employer and/or unjustified delay in payment of wages.

Regular Pay

Payment should be made before the 7th day of a month where the number of workers is less than

1000 and 10th day otherwise. The wage-period shall not exceed 1 month. The Act is applicable

only to employees drawing wages not exceeding Rs. 6500 a month. 

Mode of Payment

Under the act, payment has to be made in currency notes or coins. Cheque payment or crediting

to bank account is allowed with consent in writing by the employee. (Section 6)

Deduction from Wages

Employer is allowed to effect only authorized deductions, as specified in the Act. This include

fines (Section 8), absence from duty (Section 9), Damages or loss (Section 10), deduction for

services (amenities ) given to employer (Section 11) recovery of advances and loans (Section 12,

13) and payment to cooperative society and insurance (Section 13).

Claims for excessive deduction and Non Payment

Employers individually or through trade union can approach the authority (Labour Office) for

relief. (Section 15, 16, 17)

Scope and coverage

Application for payment of wages to persons employed in any factory.  Not applicable to wages which average Rs 1600/- per month or more. Wages include all remuneration, bonus, or sums payable for termination of service, but do

not include house rent reimbursement, light vehicle charges, medical expenses, TA, etc. 

Main provisions

Responsibility of the employer for payment of wages and fixing the wage period. Procedures and time period in wage payment.  Permissible deductions from wages. Nominations to be made by employees.  Penalties for contravention of the Act. Equal remuneration for men and women. Obligations and rights of employers. Obligations and rights of employees.

Italian Context

Payment of wages: Definitions. (Sec. 31-71a). Whenever used in sections 31-71a to 31-71i, inclusive; (1) "Employer" includes any individual, partnership, association, joint stock company, trust, corporation, the administrator or executor of the estate of a deceased person, the conservator of the estate of an incompetent, or the receiver, trustee, successor or assignee of any of the same, employing any person, including the state and any political subdivision thereof; (2) "Employee" includes any person suffered or permitted to work by an employer; (3) "Wages" means compensation for labor or services rendered by an employee, whether the amount is

determined on a time, task, piece, commission or other basis of calculation; (4) "Commissioner" means the labor commissioner.

Sec. 31-71b. Weekly payment of wages. Exemptions. (a) Each employer, by himself, his agent or representative, shall pay weekly all moneys due each employee on a regular pay day, designated in advance by the employer, in cash, by negotiable checks or, upon an employee's written request, by credit to such employee's account in any bank which has agreed with the employer to accept such wage deposits. (b) The end of the pay period for which payment is made on a regular pay day shall be not more than eight days before such regular pay day, provided, if such regular pay day falls on an non-work day, payment shall be made on the preceding work day. (c) This section shall not be construed to prohibit a local or regional board of education and a recognized or certified exclusive bargaining representative of its certified employees or noncertified employees from including within their collective bargaining agreement a schedule for the payment of wages to certified or noncertified employees that differs from the requirements of sub-sections (a) and (b) of this section. (d) Nothing in this section shall be construed to apply to employees swapping work-days or shifts as permitted under a collective bargaining agreement.

Payment of wages on termination of employment. (Sec 31-71c). (a) Whenever an employee voluntarily terminates his employment, the employer shall pay the employee's wages in full not later than the next regular pay day, as designated under section 31-71b, either through the regular payment channels or by mail. (b) Whenever an employer discharges an employee, the employer shall pay the employee's wages in full not later than the business day next succeeding the date of such discharge. (c) When work of any employee is suspended as a result of a labor dispute, or when an employee for any reason is laid off, the employer shall pay in full to such employee the wages earned by him not later than the next regular pay day, as designated under section 31-71b.

Payment where wages disputed. (Sec 31-71d). (a) In case of a dispute over the amount of wages, the employer shall pay, without condition and within the time set by sections 31-71a to 31-71i, inclusive, all wages, or parts thereof, conceded by him to be due, and the employee shall have all remedies provided by law, including those under said sections as to recovery of any balance claimed. (b) The acceptance by any employee of a payment under this section shall not constitute a release as to the balance of his claim and any release required by an employer as a condition to payment shall be void.

Withholding of part of wages. (Sec. 31-71e). No employer may withhold or divert any portion of an employee's wages unless (1) the employer is required or empowered to do so by state or federal law, or (2) the employer has written authorization from the employee for deductions on a form approved by the commissioner, or (3) the deductions are authorized by the employee, in writing, for medical, surgical or hospital care or service, without financial benefit to the employer and recorded in the employer's wage record book, or (4) the deductions are for contributions attributable to automatic enrollment, as defined in section 2 of this act, in a retirement plan described in Section 401(k), 403(b), 408, 408A, or 457 of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended, established by the employer.

Employer to furnish employee certain information. (Sec. 31-71f). Each employer shall: (1) Advise his employees in writing, at the time of hiring, of the rate of remuneration, hours of employment and wage payment schedules, and (2) make available to his employees, either in writing or through a posted notice maintained in a place accessible to his employees, any employment practices and policies or change therein with regard to wages, vacation pay, sick leave, health and welfare benefits and comparable matters.

Penalty. (Sec. 31-71g). Any employer or any officer or agent of an employer or any other person authorized by an employer to pay wages who violates any provision of this part may be: (1) Fined not less than two thousand nor more than five thousand dollars or imprisoned not more than five years or both for each offense if the total amount of all unpaid wages owed to an employee is more than two thousand dollars; (2) fined not less than one thousand nor more than two thousand dollars or imprisoned not more than one year or both for each offense if the total amount of all unpaid wages owed to an employee is more than one thousand dollars but not more than two thousand dollars; (3) fined not less than five hundred nor more than one thousand dollars or imprisoned not more than six months or both for each offense if the total amount of all unpaid wages owed to an employee is more than five hundred but not more than one thousand dollars; or (4) fined not less than two hundred nor more than five hundred dollars or imprisoned not more than three months or both for each offense if the total amount of all unpaid wages owed to an employee is five hundred dollars or less.

Regulations. (Sec. 31-71h). The commissioner is authorized to issue regulations for the establishment of procedures for carrying out the provisions of section 31-71a to 31-71i, inclusive.

Waiver of weekly payment requirement. (Sec 31-71i). The commissioner may, upon application, waive the provisions of section 31-71b with respect to any particular week or weeks, and may also, upon application, permit any employer, subject to the provisions of this section, to establish regular pay days less frequently than weekly, provided each employee affected shall be paid in full at least once in each calendar month on a regularly established schedule.

Civil action to collect wage claim, fringe benefit claim or arbitration award. (Sec. 31-72). When any employer fails to pay an employee wages in accordance with the provisions of sections 31-71a to 31-71i, inclusive, or fails to compensate an employee in accordance with section 31-76k or where an employee or a labor organization representing an employee institutes an action to enforce an arbitration award which requires an employer to make an employee whole or to make payments to an employee welfare fund, such employee or labor organization may recover, in a civil action, twice the full amount of such wages, with costs and such reasonable attorney's fees as may be allowed by the court, and any agreement between him and his employer for payment of wages other than as specified in said sections shall be no defense to such action. The labor commissioner may collect the full amount of any such unpaid wages, payments due to an employee welfare fund or such arbitration award, as well as interest calculated in accordance with the provisions of section 31-265 from the date the wages or payment should have been received, had payment been made in a timely manner. In addition, the labor commissioner may bring any legal action necessary to recover twice the full amount of unpaid wages, payments due to an employee welfare fund or arbitration award, and the employer

shall be required to pay the costs and such reasonable attorney's fees as may be allowed by the court. The commissioner shall distribute any wages, arbitration awards or payments due to an employee welfare fund collected pursuant to this section to the appropriate person.

Payment of fringe benefits upon termination of employment. (Sec. 31-76k). If an employer policy or collective bargaining agreement provides for the payment of accrued fringe benefits upon termination, including but not limited to paid vacations, holidays, sick days and earned leave, and an employee is terminated without having received such accrued fringe benefits, such employee shall be compensated for such accrued fringe benefits exclusive of normal pension benefits in the form of wages in accordance with such agreement or policy but in no case less than the earned average rate for the accrual period pursuant to sections 31-71a to 31-71i, inclusive.

Additional penalty. (Sec. 31-69a). In addition to the penalties provided in part III of chapter 557, and this chapter, any employer, officer, agent, or other person who violates any provision of part III of chapter 557 or this chapter, or both, shall be liable to the labor department for a civil penalty of one hundred fifty dollars for each violation of said chapters. The attorney general, upon complaint of the labor commissioner, shall institute a civil action to recover such civil penalty. Any amount recovered shall be deposited in the general fund and credited to a separate non lapsing appropriation to the labor department, for other current expenses, and may be used by the labor department to enforce the provisions of part III of chapter 557 and this chapter. 

Payment of Min. Wages Act

Indian Context

THE MINIMUM WAGES ACT, 1948

I. OBJECT: For fixing minimum rates of wages in certain employments.

II. APPLICABILITY: It extends to the whole of India and applies to scheduled employments in respect of which minimum rates of wages have been fixed under this act.

III. SCHEDULED EMPLOYMENTS: An employment specified in the schedule, or any process or branch of work forming part of such employment (Section-2g)

IV. FIXING OF MINIMUM RATES OF WAGES:

i. The appropriate government shall fix the minimum rates of wages payable to employees employed in a scheduled employment.

ii. Review at such intervals not exceeding five years, the minimum rates of wages so fixed and revise the minimum rates if necessary. The minimum rates of wages may be fixed as a minimum time rate or a minimum piece rate or as a guaranteed time rate (Section-3).

V. PAYMENT OF MINIMUM RATES OF WAGES: The employer shall pay to every employee in a scheduled employment under him wages at the rate not less than the minimum rates of wages fixed under the Act. (Section-12)

VI. HOURS OF WORK, OVERTIME ETC

The Act also provides for regulation or working hours, overtime, weekly holidays and overtime wages. Period and payment of wages, and deductions from wages are also regulated. (Section—13 to 17)

VII. CLAIMS UNDER THE ACT (Section-20): this section makes provisions to appoint authorities to hear and decide all claims arising out of payment less than the minimum rates of wages or any other monetary payments due under the Act. The presiding officers of the Labour court and Deputy Labour Commissioners are the authorities appointed.

VIII. WHO CAN FILE A CLAIM PETITION

i. The Employee or

ii. Any legal practitioner or any official of a regd. Trade union authorized in writing to act on his behalf or

iii. Any Inspector or

iv. Any person acting with the permission of the authority under Section-20 (I)

X. REGISTERS AND RECORDS

Every employer shall maintain the following registers and records as required under the Kerala Minimum Wages Rules 1958 enacted vide section-30 of the Act.

i. Register of wages in Form No. XI or Form XII

ii. A muster-roll in Form No. VI

iii. Register of fines, Form No. I

iv. Register of deductions for damage or loss in Form No. II

v. Register of overtime in Form No. V

vi. Visit book

vii. A wage slips in Form No. XIII shall be issued by every employer to every person employed by him at least a day prior to the disbursement of wages.

X. NOTICE TO BE EXHIBITED: A notice in Form IV containing the minimum rates of wages fixed together with the abstract of the Act, the rates made there under and the name and address of the inspector shall be displayed in English and in a language understood by the majority of the workers.

XI. ANNUAL RETURNS: Annual returns in Form III or Form III a as per rule 21 (4) (iii) shall be submitted to the Inspector before the first day of the February of the succeeding year.

XII. PRESERVATION OF REGISTERS: All the registers shall be preserved for a period of three years after the date of last entry made therein.

XIII. PENTALITY: Any employer who contravenes any of the provisions of this Act other than those relating to Section 12 and 13 of any rule or any order made there under shall be punishable with fine, which may extend to Rs.500. Any employer who contravenes the provision relating to the payment of minimum rates of wages fixed (Section- 12) hours of work stipulated for constituting a normal working day as per section 13 shall be punishable with imprisonment for a term which may extend to six months or with fine which may extend to Rs. 500/ - or with both.

Italian Context

Italy like many other European Union countries such as Norway, Sweden, Austria, Denmark, Switzerland and Germany have no minimum wages laws but rely on employers groups and trade unions to set minimum earnings through collective bargaining.

Under Italian law there is not a statutory minimum wage. Yet most workers are actually covered by a minimum wage agreement, established through collective bargaining. Upon request, judges can also fix a minimum wage, though it would be binding only on the parties to an individual contract of employment.

Gratuity Act

Indian Context

THE PAYMENT OF GRATUITY ACT, 1972

ACT NO. 39 OF 1972

[21st August, 1972.]

An Act to provide for a Scheme for the payment of gratuity to employees engaged in factories, mines, oilfields, plantations, ports, railway companies, shops or other establishments and for matters connected therewith or incidental thereto.

Application of this Act

(a) Every factory, mine, oilfield, plantation, port and Railway Company;

(b) every shop or establishment within the meaning of any law in which ten or more persons are employed, or were employed, on any day of the preceding twelve months;

(c) Such other establishments or class of establishments, in which ten or more employees are employed, or were employed, on any day of the preceding twelve months, as the Central Government may, by notification, specify in this behalf.

(d) (Wide application. Only condition- 10 or more employees)

Employee

Any person (other than an apprentice) employed on wages, in any establishment, factory, mine, oilfield, plantation, port, railway company or shop, to do any skilled, semi-skilled, or unskilled, manual, supervisory, technical or clerical work, whether the terms of such employment are expressed or implied and whether or not such person is employed in a managerial or administrative capacity, but does not include any such person who holds a post under the Central Government or a State Government and is governed by any other Act or by any rules providing for payment of gratuity.

Who is eligible for gratuity and when?

Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years,-

(a) On his superannuation, or

(b) On his retirement or resignation, or

(c) On his death or disablement (five year service not required) due to accident or disease

Forfeiture of Gratuity

An employee, whose services have been terminated for any act, willful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer, shall be forfeited to the extent of the damage or loss so caused;

the gratuity payable to an employee may be wholly or partially forfeited if the services of such employee have been terminated for his riotous or disorderly

conduct or any other act of violence on his part, or if the services of such employee have been terminated for any act which constitutes an

offence involving moral turpitude, provided that such offence is committed by him in the course of his employment

Employer’s failure to pay insurance premium

When an employer fails to make any payment by way of premium to the insurance or by way of contribution to an approved gratuity fund he shall be liable to pay the amount of gratuity due under this Act including interest, if any, for delayed payments forthwith to the controlling authority.

Punishment for failure to pay premium or Gratuity

Shall be punishable with fine which may extend to ten thousand rupees and in the case of a continuing offence with a further fine which may extend to one thousand rupees for each day during which the offence continues.

Time limit for payment of gratuity

The employer shall arrange to pay the amount of gratuity within thirty days from the date it becomes payable

If not paid within the period stipulated above employer is liable to pay interest for the delayed payment

Interest is not payable if the delay was caused due to the fault of the employee and the employer has obtained permission in writing from the controlling authority for the delayed payment on this ground

If there is any dispute as to the amount payable or the persons eligible to receive it the employer shall deposit amount as per his calculation with the controlling authority.

Italian Context

In Italy, there is no separate section provided for Gratuity act in particular. All the benefits, doubts, compensation are resolved through collective agreements between the parties in the matter. Any further clarifications as such are made with reference to dictations of trade unions.

Work Benefit Compensation

Indian Context

THE WORKMEN'S COMPENSATION ACT, 1923 ACT NO. 8 OF 1923 1*

Workmen's Compensation Act 1923 is central legislation which provides for payment of compensation for injuries suffered by a workman in the course of and arising out of his employment according to the nature of injuries suffered and disability incurred, where death results from the injury, the amount of compensation is payable to the dependants of the workmen.

Applicability of the Act

The Act applies to

Railway servants Factories Mines Plantations mechanically propelled vehicles construction works certain other hazardous occupations

Nature of compensation

The amount of compensation to be paid depends on the nature of the injury and the average monthly wages and age of workmen. The minimum and maximum rates of compensation payable for death (in such cases it is paid to the dependents of workmen) and for disability have been fixed and is subject to revision from time to time.

Object:

The objective of this Act is that in the case of an employment injury compensation be provided to the injured workman and in case of his death to his dependants.

Employer to pay compensation:

In case a personal injury is caused to a workman by accident arising out of and in the course of his employment, his employer is liable to pay compensation in accordance with the provision of the Act within 30 days from the date when it fell due otherwise he would also be liable to pay interest and penalty.

When employer is not liable:

In case the disablement of workman is three or less days; except in case of death when the injury is caused due to influence of drink or drug taken by the workman or upon his willful disobedience to obey safety rules or removal of safety guards by him.

Amount of compensation:

(1) in case of death:- an amount equal to 50% of the monthly wage multiplied by the relevant factor as given in Schedule IV of the Act or Rs. 80,000/whichever is more. (2) In case of permanent total disablement, it is 60% or Rs. 90,000/whichever is more and (3) In case of permanent partial disablement occurs then the compensation is proportionate to the disability arrived as at (2) above

Notice:

An injured person or his dependants have to give a notice to the employer to pay compensation.

Claim:

Upon the failure or refusal of an employer to give compensation, an application is to the made in Form - F to the Commissioner under the Workmen's Compensation Act, 1923 who is the Assistant Labour Commissioner or the Labour-cum-Conciliation Officer of the area where the accident took place or where the claimant ordinarily resides or where the employer has his registered office. After hearing both the parties, the Commissioner decides the claim.

Contracting out:

Any contract or agreement whereby an injured person or his dependant relinquishes or reduce his right to receive compensation is null and void to that extent.

Appeal:

An appeal lie to the High Court against the orders of the Commissioner with regard to the awarding or refusing to award compensation, or imposing interest or penalty, or regarding distribution of compensation etc.

Recovery:

The amount of compensation awarded by the Commissioner is to be recovered as arrears of land revenue.

Italian Context

Worker benefits and compensation are included in the Italian Labour law. No separate act has been passed for it.

Where there are fewer than 15 employees in a unit or fewer than 60 employees in total, the employee unfairly dismissed has no right to reinstatement, but is entitled to compensation ranging from 2, 5 to six times the monthly pay.

Verdict- in India, workmen benefit and compensation does not arise for Macpi group as they have only 19 permanent employees and the rest of the work they do it through contract agencies.

Trade Union

Indian Context

THE TRADE UNIONS’ ACT, 1926

I. OBJECT: To provide for the registration of trade unions and to define law relating to registered trade unions.

II. APPLICABILITY: It extends to the whole of India.

III. TRADE UNIONS: means any combination whether temporary or permanent formed primarily for the purpose of regulating the relations between workmen and employers or between workmen and workmen, or between employees and employers imposing restrictive conditions on the conduct of any trade or business, and includes any federation of two or more trade unions.

IV. MODE OF REGISTRATION: Any seven or more members of a trade union may apply for registration of a trade union in Form - A to the Registrar appointed for the area. The application shall be accompanied by Schedule I, Schedule II and a byelaw and a resolution authorizing seven ordinary members of the union to make an application for registration of the union, and a treasury chalan of Rs.500/- remitted as registration fee. (Section 4 and 5 read with Regulation: 3 & 5)

V. REGISTRATION CERTIFICATE: On receipt of the application for registration, the Registrar, after making reasonable enquiry issue a Registration Certificate in Form - B (Section 8 & read with Regulation 6)

VI.CANCELLATION OF REGISTRATION:

A certificate of Registration may be withdrawn or cancelled by the Registrar:

1. On an application of a Trade Union in Form-D, or

2. If the Registrar is satisfied that the certificate is obtained by fraud of mistake or that the trade union had ceased to exist or willfully and after notice from the Registrar contra vent any provisions of the Act or rules etc. (Section 10 read with Regulations 8 to 12)

VII. APPEAL: Any person aggrieved by any order of the Registrar may appeal within two months to the Civil Court not inferior to the court of an Additional or Assistant Principal Civil Court. (Section 11 read with Regulation 13)

VIII. CHANGE OF NAME: Any registered trade union may with the consent of not less than 2/3 of its total members may make application in Form-H, for the change of its name (Section - 23 read with Regulation - 16).

IX. AMALGAMATION OF TRADE UNIONS: Any two or more registered trade unions may become amalgamated together as one trade union provided the votes of at least one half of the members of each or every such trade union entitled to vote and at least 60% of the votes recorded are in favor of the proposal. Notice of the amalgamation shall be sent to the Registrar induplicate in Form-J (Section 24 to 26 read with Regulation 18)

X. DISSOLUTION: When a registered trade union is dissolved the notice of dissolution shall be sent to the Registrar in Form - K, within 14 days of the dissolution along with the registration certificate (Section 27 read with Regulation 19)

XI. ANNUAL RETURNS: Every trade union shall send annual returns to the Registrar in triplicate on or before the 1st day of June of the year succeeding the calendar year in Form-L in the case of individual trade unions and in Form-LL in the case of federation of trade unions (Section 28 read with Regulation 21)

XII. PENALTIES: Offences punishable for the failure to submit returns may extend to Rs.5/- and in the case of continuing default with an additional fine which may extend to Rs.5/- for each weekend shall not exceed Rs.50.00. Any person who willfully makes, or causes to be made any false entry or any omission from the general statement required by Section 28 etc. shall be punishable which may extend to Rs.500/-. Registered trade unions, furnishing false information, shall be punishable with fine which may extend to Rs.200/- (Section 31)

XIII. WHO CAN FILE PROSECUTIONS?

1. Registrar

2. Persons with the previous sanction of the Registrar.

3. Aggrieved person under Section 32.

The complaint shall be filed within six months of the date on which the offence is alleged to have been committed.No court inferior to that of a Presidency Magistrate or a Magistrate of First Class shall try any offence under the Act.

XIV. AUTHORITIES UNDER THE ACT:

1. Registrar of Trade Unions (under Section - 3)

Labour Commissioner

2. Additional Registrar of Trade Unions

Additional Labour Commissioner (IR & E)

Italian Context

Trade union regulation

The Italian Constitution recognizes the right of citizens to associate freely (Sect. 19) and the right of employers and employees to join associations or unions.

Sect. 39 of the Constitution regulates trade unions and specifies that only the registered ones can obtain legal status and can make collective agreements valid erga omnes (for all employers and employees). This provision, however, has not been enforced because a bill regulating the registration of unions has never been adopted. Therefore, in Italy unions do not need any recognition and can organize themselves without any pre-established legal model. They can conclude collective agreements, which are legally enforceable under civil law rules, i.e. on the assumption that the parties to a collective agreement have stipulated on behalf of their respective membership. Usually the employers abide by the collective agreements concluded by the most important unions and employers’ associations and pay wages in accordance with them for all their employees.

The Workers’ Statute (Sect. 14) recognises freedom of association and freedom of trade union activity at the workplace. The same rights are also guaranteed to public employees (except military staff, who have representatives not belonging to the unions). Act 121, 1 April 1981 also guarantees union freedom and activity to the Italian Police (Polizia di Stato, that is not a military force), except for the right to strike and union activities which may compromise public security (Sect. 84).

The law does not fix any model of union organization either for the unions or for the employers’ associations.

For workers the most frequent pattern is the industry-wide union, which has local, provincial, regional and national organs (vertical organization). The national unions join together in trade union federations (horizontal organization).

For the employers there is a similar model of organization, with provincial, regional and national associations, that join to form federations. There are three employers’ federations: industrial, commercial and artisan.

Recently local unions have been formed, which do not join the traditional federations, but have their own coordinating organs.

Unions are financed by the workers’ dues. Sect. 26 of the Workers’ statute authorizes the unions to deduct union dues from the employee’s wages (check-off).

Verdict- Macpi India is not affected by trade unions act of both the countries as Italian law will not work here and Macpi India does not employ blue collar people who work for them directly.

Employee Provident Fund

Indian context

Employee’s provident fund and miscellaneous provisions Act, 1952

[Act No. 9 of Year 1952, dated 4th. March, 1952]

An Act to provide for the institution of provident funds, [pension fund] and deposit linked insurance fund for employees in factories and other establishment.

Introduction

The Supreme Court has stated in Andhra University v. R.P.F.C. 1985 (51) FLR 605(SC) that in construing the provisions of the Employees Provident Funds and Miscellaneous Provisions Act 1952, it has to be borne in mind that it is a beneficent piece of social welfare legislation aimed at promoting and securing the well-being of the employees and the court will not adopt a narrow interpretation which will have the effect of defeating the very object and purpose the Act. The preamble to the Act also states that this is an Act to provide for the institution of:

(i) Provident Funds

(ii) Pension Fund and

(iii) Deposit Linked Insurance Fund

for employees in factories and other establishments. It is with this background that one must interpret the various provisions of the Act and the Scheme related to it.

Applicability

The Employees Provident Funds and Miscellaneous Provisions Act 1952 applies to the whole of India except the State of Jammu and Kashmir (Section 2). This Act applies (Section 3) to:

(i) every establishment which is a factory engaged in any industry specified in Schedule I and in which 20 or more persons are employed, and

(ii) any establishment employing 20 or more persons or class of such establishments which the Central Government may, by notification in the official gazette specify. The Central Government through the Employees Provident Fund Scheme 1952 {Section 3 (b)} has specified the establishments covered by the Act.

Exemptions

The provisions of the Employees Provident Funds and Miscellaneous Provisions Act 1952 do not apply to the following institutions (sec 16):

(i) Any establishment registered under the Co-operative Societies Act 1912 or under any other law for the time being in force in any State relating to co-operative societies, employing less than 50 persons and working without the aid of power.

(ii) Any establishment belonging to or under the control of the Central or State Government and whose employees are entitled to the benefit of contributory provident fund or old age pension in accordance with any scheme framed by such government.

(iii) Any other establishment set up under any Central, Provincial or State Act and whose employees are entitled to the benefit of contributory provident fund or old age pension in accordance with any scheme framed under that Act.

(iv) The P.F. Scheme is not applicable to tea factories in the State of Assam {para 3(a)(iii)}.

Italian Context

In Italy, employees provident fund is taken care by the respective trade union associated with the industry and also by unions of which the employee is a member of (if any). This is done by collective bargaining and agreements. Unions can freely negotiate collective agreements at provincial, regional and national levels.

Collective bargaining can regulate all aspects of the employer-employee relationship, except those that are regulated by law.

In accordance to the law, the welfare of the employees is looked over by both the trade union and the employer.

Verdict- In India, Macpi Group does not have to worry about issuing P.F. to its employees as

the employees are a third party to the contract.

Industrial Disputes

Indian Context

THE INDUSTRIAL DISPUTES ACT, 1947

IntroductionPrior to the year 1947, Industrial disputes were being settled under the provisions of the Trade Disputes Act, 1929. Experience of the working of the 1929 act revealed various defects which needed to be overcome by a fresh legislation. Accordingly the Industrial Disputes Bill was introduced in the Legislature. The Bill was referred to the select committee. On the recommendations of the Select Committee amendments were made in the original Bill.  

Objectives

The objective of the Industrial Disputes Act is to secure industrial peace and harmony by providing machinery and procedure for the investigation and settlement of industrial disputes by negotiations.

The Act also lays down

The provision for payment of compensation to the Workman on account of closure or lay

off or retrenchment.

The procedure for prior permission of appropriate Government for laying off or

retrenching the workers or closing down industrial establishments

Unfair labour practices on part of an employer or a trade union or workers.

Applicability

The Industrial Disputes Act extends to whole of India and applies to every industrial

establishment carrying on any business, trade, manufacture or distribution of goods and services

irrespective of the number of workmen employed therein. Every person employed in an

establishment for hire or reward including contract labour, apprentices and part time employees

to do any manual, clerical, skilled, unskilled, technical, operational or supervisory work, is

covered by the Act. This Act though does not apply to persons mainly in managerial or

administrative capacity, persons engaged in a supervisory capacity and drawing > 1600 p.m or

executing managerial functions and persons subject to Army Act, Air Force and Navy Act or

those in police service or officer or employee of a prison.

Italian Context

Settlement of labour disputes law

Labour Courts are integrated into the organization of the general civil court system, but follow special procedure.

A special jurisdiction on labour issues was established in 1893, with an Act which introduced a “consiglio di probiviri”, composed of representatives of employers and employees, for lower cases.

The fascist reform of 1926 transferred all cases to professional judges, and so it remained till now. Act 533 of 1973 provides special procedural rules, which reduces the amount of written material at a labour trial, increase participation by the litigants, and speed up the trial. There is one professional judge in the first instance, whatever the monetary amount of the case, whose decisions can be appealed before a Tribunal of three judges, with a possible further appeal before the five members Supreme Court Labour Chamber.

Act 80 of 1998 transferred to the labour courts the competence to hear cases brought by civil servants, which were previously dealt by the administrative courts. The same law now requires the plaintiff, before he/she sues in the Court, to try to resolve his/her dispute through conciliation before a public labour office, or through a union dispute resolution procedure.

There is not a procedure for collective disputes, except for the possibility, introduced by the Act 80 of 1998, of asking the Supreme Court for the immediate interpretation of a collective agreement signed by the union of civil servants.

Maternity Benefits

Indian Context

THE MATERNITY BENEFIT ACT, 1961

Provided that where a notice, appeal or complaint under the said rules has been submitted by a woman entitled to receive maternity benefit or any other amount due under the Act in a form other than the prescribed form, the authority concerned may, within 15 days of the receipt of such notice, appeal or complaint, require the woman to submit the notice, appeal, or complaint, as the case may be, in the prescribed form.

OBJECT: To regulate the employment of women in certain establishments for certain periods before and after childbirth and to provide for maternity benefits and certain other benefits.

APPLICABILITY: It extends to the whole of India and applies to

i) Every factory, mine, plantations, establishments for the exhibition of equestrian, acrobatic and other performances.

ii) To every shop or establishments defined under any law applicable to such establishments in a state in which persons are employed on any day of the preceding twelve months.

PROHIBITED PERIOD OF EMPLOYEMENT OR WORK: The employment of women, or work by women in any establishment during the six weeks immediately following the day of her delivery or her miscarriage (sectiion-4).

PAYMENT OF MATERNITY BENEFIT: Every women shall be entitled to, and her employer shall be liable for, the payment of maternity benefit at the rate of average daily wage for the period of her actual absence, and any period of her actual absence, and any period immediately following the date of delivery and including the actual day for her delivery (Section –5). In addition to the maternity benefit, every woman shall also be entitled to receive a medical bonus of Rs.250/ - if no prenatal confinement and post natal care is provided free of charge (section-8).

ELIGIBILITY FOR MATERNITY BENEFIT:

A woman shall be entitled to maternity benefit only if she has actually worked in an establishment of the employer for a period of not less than eighty days in the twelve months immediately preceding the date of her expected delivery (section-5[2])

MAXIMUM PERIOD OF MATERNITY BENEFIT: Maximum twelve weeks of which not more than six weeks shall proceed the date of her expected delivery (section-5[5]).

OTHER BENEFITS:

Act also provides provisions for leave for miscarriage, leave for illness arising out of pregnancy or delivery, premature birth of child or miscarriage and nursing breaks for nursing the child until the child attained the age of 15 months (section-910 & 11)

DISMISSAL, DEDUCTION WAGES, ETC: No employer shall discharge or dismiss a women for her absence from work in accordance with the provisions of this Act and no deduct ion shall be made from the normal; and usual daily wages of a women entitled to maternity benefits. (Section –12&13)

TO WHOM CLAIM CAN BE PREFFRRED: Any claim due under this act may file to the inspector appointed under section 14 of the Act (section-17)

APPELLATE AUTHORITY: Any appeal against the decision of the Inspector may within thirty days prefer to the Deputy Labour Commissioner, who is the appellate authority prescribed. (Section-17[3])

REGISTERS: Every employer shall prepare and maintain a muster roll in Form-A.

ANNUAL RETURN: The employer shall on or before 31stday of January in each year submit a return in From-L to the complete authority as to the particulars specified, in respect of the preceding year (Rule-16)

PENALTY: Punishment for the offences under the Act is with imprisonment which shall not be less than three months but which may extend to one year and with fine which shall not be less than Rupees two thousand but it may extend to Rupees five thousand. (Section-21)

WHO CAN FILE PROSECUTION?

1. Any aggrieved women.

2. An office bears of a trade union registered under the Trade unions Act.1926.

3. A voluntary organisation registered under the Societies Act.

4. An inspector

No court inferior to that of a Metropolitan Magistrate or a Magistrate of the First Class shall try any offences under this Act, (section-23).

Italian Context

Maternity leave and maternity protection Law

Female workers have special protection in case of pregnancy and maternity (Sect. 2110 Civil Code, Act 1204 of 30 December 1971).From the beginning of pregnancy to one year after the child’s birth, the employee cannot be dismissed (except for just cause) and during this period, a woman who resigns has the right to the same indemnities due for dismissals (provided she gives due notice).

Maternity leave is compulsory for female workers, from two months before until three months after childbirth. Pre childbirth leave can start at an earlier date than two months, if the worker’s work is dangerous for her health or that of the unborn child. On the other hand it is possible to postpone pre-childbirth leave in order to increase the leave granted after childbirth.

Some rights, reserved for the mother by Act 1204/1971, have been gradually extended to the father, at first only in case of the mother’s impediment, but more recently with many alternative choices being made available to both parents.

In 1987, for the first time, the Constitutional Court  (decision no.1/1987) extended to the father the right to leave for three months after birth, where the mother’s caring for the child had become impossible due to illness or death.It is also possible for both parents of an adopted child to obtain paid leave for three months after the effective introduction of the child into the family (Act no.903 of 1977, Act no. 184 of 1983, Constitutional Court no. 322/1998).

But only with Act no .53/ 2000 has Italian Legislation really improved in considering parental leave as a right of the family in order to protect children.

Both parents have the right to leave for no more than a total of 10 months during the first eight years of a child’s life. A longer period is possible (up to two years) in case of children with handicaps (Act 388/2000).

During compulsory maternity leave, the mother is entitled to 80% of her regular pay from Social Security and the period is counted as actual work time. Collective agreements usually oblige the employer to make up the difference to the regular wage.

Subsequent parental leave has now the same economic consequences for both parents: 30% of regular pay (form Social security) for six months. For additional time there are different indemnities depending on the family income.

Both parents have equal right to leave in case of a child’s illness; without limitation for the first three years of age and for five days a year until age eight.

More flexibility in the working time schedule for both parents is now foreseen in article 9 of Act 53 /2000.

The working mother, during the first year, has the additional right to two hours of daily rest, initially intended for breast-feeding. Supplementary time is also foreseen in case of twins or multiple births.

A recently approved law (Act 151 of 26 March 2001) has consolidated most of the above provisions into a single text. Act no.196 of 1997 provides for specific incentives (i.e. reduction of social security contributions) directed at favoring part-time work for women who want to re-enter the labour market after at least two years of inactivity.

Payment of Bonus

Indian Context

Introduction

An Act to provide for the payment of bonus to persons employed in certain establishments on the basis of profits or on the basis of production or productivity and for matters connected therewith.

Short title, extent and application

It extends to the whole of India Every other establishment in which twenty or more persons are employed on any day

during an accounting year.

Applicability

Every factory (as def. in Factories Act), & (b) Every other establishment in which 20 or more persons (less than 20 but 10 or more if appropriate Govt. notifies) are employed on any day subject to certain exemptions.

Bonus to be paid within eight months from the expiry of the accounting year.

Establishments to include departments, undertakings and branches: Where an establishment consists of different departments or undertakings or has branches, whether situated in the same place or in different places, all such departments or undertakings or branches shall be treated as parts of the same establishment for the purpose of computation of bonus.

Eligibility

Every employee shall be entitled to be paid by his employer in an accounting year, bonus, in accordance with the provisions of this Act, provided he has worked in the establishment for not less than thirty working days in that year.

Disqualification for bonus

An employee shall be disqualified from receiving bonus under this Act:-

fraud; or riotous or violent behavior while on the premises of the establishment; or theft, misappropriation or sabotage of any property of the establishment

Time-limit for payment of bonus

(a) where there is a dispute regarding payment of bonus pending before any authority under section 22, within a month from the date on which the award becomes enforceable or the settlement comes into operation, in respect of such dispute;

(b) in any other case, within a period of eight months from the close of the accounting year

RIGHTS OF EMPLOYEES

Right to claim bonus payable under the Act and to make an application to the Government, for the recovery of bonus due and unpaid, within one year of its becoming due.

Right to refer any dispute to the Labour Court/Tribunal. Employees, to whom the Payment of Bonus Act does not apply, cannot raise a dispute

regarding bonus under the Industrial Disputes Act. Right to seek clarification and obtain information, on any item in the accounts of the

establishment

Italian Context

There is nothing as such as or equivalent to payment of bonus act in Italy. It depends on the contract between the employee and employer.

Contract payment

Indian Context

INTRODUCTION

10.1 The system of employing contract labour is prevalent in most industries in different occupations including skilled and semi skilled jobs. It is also prevalent in agricultural and allied operations and to some extent in the services sector. A workman is deemed to be employed as Contract Labour when he is hired in connection with the work of an establishment by or through contractor Contract workmen are indirect employees persons who are hired, supervised and remunerated by a contractor who, in turn, is compensated by the establishment. Contract labour has to be employed for work which is specific and for definite duration. Inferior labour status, casual nature of employment lack of job security and poor economic conditions are the major characteristics of contract labour. While economic factors like cost effectiveness may justify system of contract labour, considerations of social justice call for its abolition or regulation.

The concern for providing legislative protection to this category of workers, whose conditions have been found to be abysmal, resulted in the enactment of the Contract Labour (Regulation and Abolition) Act, 1970.

OBJECT: To regulate the employment of contract labour in certain establishments and to provide for its abolition in certain circumstances and for matters connected therewith.

APPLICABILITY: It extends to the whole of India and applies to :

every establishment in which twenty or more persons are employed or were employed on any day of the preceding twelve months as contract labour

to every contractor who employs or who employed on any day of the preceding twelve months twenty or more workmen. The appropriate govt. can extend the provisions of the Act to any establishments or contractor employing less than the number specified above, by notification.

It shall not apply to establishments in which work is of intermittent or casual nature

WORKMEN: Any person employed in or in connection with the work of any establishment to do any skilled or semi -skilled or unskilled, manual, supervisory, technical or clerical work for hire or reward whether the terms of the employment be expressed or implied but does not include:

Persons employed mainly in a managerial or administrative capacity Persons being employed in a supervisory capacity draws wages exceeding Rs.500/ per

month. An out worker.[Section 2 (i)]

ADVISORY BOARDS: The central govt. and the state govt. have constituted a Central Advisory Board and a State Advisory Contract Labour Board respectively to advise the govts. On such matters arising out of the administration of the Act. (Section 3 & 4 read with rule 3 to 16 of the Kerala Contract Labour (Regulation and Abolition) Rule 1974.

REGISTRATION OF ESTABLISHMENT: Every principal employer of an establishment shall make an application for registration in triplicate in Form No.I to the registering officer of the area along with a treasury receipt showing payment of the prescribed fee. If the application for registration is complete in all respects, the registering officer shall register the establishment subject to rule 17 to 20 an d issue a registration certificate in Form-II (Section 7 to 9 read with rule 17 to 20)

PROHIBITION OF EMPLOYMENT OF CONTRACT LABOUR: The appropriate govt. is empowered to prohibit employment of contract labour in any process of operation or other work in any establishment after consultation with the Advisory Board. (Section-10)

LICENSING OF CONTRACTORS: No contractor shall undertake or excite any work through contract labour except under and in accordance with a license issued by the licensing officer (Section-12)

GRANT OF LICENCES: Every contractor shall make an application for the grant of a license in triplicate in Form No.IV along with a treasury receipt showing the prescribed fee to the licensing officer. The application shall also be accompanied by a certificate by the principle employer in Form-V. The licensing officer, after making necessary investigations subject to the provisions, grant a license in Form VI (Section 13. read with rule 21 to 27)

SECURITY: The contractor shall deposit a security amount at the rate of Rs.20 for each of the workman to be employed as a contract labour at the time of making application for license. (Rule 24).

RENEWAL OF LICENCE: Every contractor shall make an application for the renewal of license in Form VII in triplicate along with the required fee not less than thirty days before the expiry date. If the renewal application is not submitted within the time specified the contractor shall be liable to pay a fee of 25% in excess of the fee ordinary Payable. A duplicate certificate shall be issued on payment of Rs. 5/ - (Section 13, 14 read with Rule 21 to 32)

APPEAL: Any persons aggrieved by an order of the registering officer/Licensing officer may within 30 days from the date of communication of the order prefer an appeal to the appellate o officer. (Section-15 read with Rule 33 to 39)

WELFARE AND HEALTH: Every contractor shall provide the welfare and health amenities such as canteens, rest rooms, drinking water, latrines and urinals, first-aid etc. to the contract workers employed, in accordance with Section-16 to 19 read with Rule 40 to 62.

LIABILITY OF PRINICPAL EMPLOYER: If any contractor does not provide the amenities prescribed above within 7 days from the commencement of the employment, the principle employer shall make provisions to provide it within 7 days. (Section 20 read with Rule 40)

PAYMENT OF WAGES: The contractor shall be responsible for the payment of wages. The payment shall be made direct or to an authorized person on a working day at the work premise in the presence of an authorized representative of the principle employer. The principle employer shall ensure the presence of authorized representative at the place and disbursement of wages. (Section - 21read with Rules 63 to 73)

ANNUAL RETURNS: Contractor shall send half yearly return in Form 24 in duplicate to the licensing officer not less than thirty days from the close of the half year. Principal employer shall send Annual Return in Form 25 in duplicate to the registering officer not later than the 15thFebruary of the succeeding year.

PENALITY: The offences relating to the obstruction to the inspector and refuses to produces the register and records etc. shall be punishable with imprisonment for a term which may extend to three months or with fine which may extend to Rs. 500/ - or with both. Contraventio9ns of provisions regarding employment of contract labour shall be punishable with imprisonment for a term which may extend to three months or with fine which may extend to Rs. 1,00/- for every day. Contraventions of the provisions of the Act or Rules in which no other penalties elsewhere provided, shall be punishable with imprisonment for a term which may extend to three months or with fine which may extend to Rs. 1,000/- or with both.

COGNIZANCE OF OFFENCE: The complaint shall be filed by the Inspector or any person with previous sanction of the Inspector, in writing, to a court not inferior to that of a Presiding Magistrate or the First Class. The complaint shall be filed within three months from the date on which the alleged commission of the offence came to the knowledge of an Inspector.

Italian Context

Italian labour contract is governed by contract act and have the same conditions that are there in contract act.

Conclusion

All through our study we found that Indian laws are more stern compared to its Italian equivalent. Indian Constitution has separate guidelines for all the above mentioned laws whereas Italian laws are not that detailed.

Also we find that Macpi India, does not get affected much by the Indian laws as their permanent employees is just 19 and the rest are all agents. This way Macpi does not qualify for almost all the laws.

As stated by Mr. Ashish Kumar, Country Head, Macpi India, this is one of the reasons for their company to have a branch in India and have permanent employee strength of only 19.