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Human Resources Management - Personnel Environment

Role of Government - Personnel Environment

   Posted On :  12.06.2018 07:05 am

Government has a positive role to play in creating personnel environment.

Role of Government

Government has a positive role to play in creating personnel environment. It makes an assessment at the National levels regarding man power requirements. This includes the highly technical professionals like engineers, doctors, technicians, civil servants and white collared jobs. So work force requirements in industries, agriculture, mining, public-works are all made and constantly updated. Requirements of army, navy and air force of field and technical staff (and recently the requirements in information technology and computers) have come under the purview of national projection for work requirement. At the state level also state planning commissions through statistical departments get data and compile the requirements. Government is assisted by Medical Council of India, Institution of Engineers, U.G.C. and Planning Commission cell for estimations and projections.
Employment Exchanges, Food for Work Schemes, Minimum Employment guarantee schemes, Rural employment schemes, Self help groups and promotions, small scale and cottage industries promotion, Khadi and village Industries Commission are all employment providers. There are also several job training schemes run by central and state governments.

Other Assistance by Government

Social security of employees comes within the fold of HRM. Government assists employees both in organized and unorganized sectors through several social security schemes and directives.

Social Security Legislation in India

The Government of India has passed various enactments from time to time. Important among them are:

1. The Workmen’s Compensation Act, 1923.

2. The Employees’ State Insurance Act, 1948.

3. The Employee’s Provident Funds and Miscellaneous Provisions Act, 1961.

4. The Maternity Benefit Act, 1961.

5. The payment of Gratuity Act, 1972.

The Workmen’ Compensation Act, 1923

The main objective of the Act is to ensure compensation to workers for accidents occurred during the course of employment. This Act covers workers employed in factories, mines, plantations, mechanically propelled vehicles, construction works, railways, ships, circus and other hazardous occupations specified in schedule II of the Act. It does not apply to the Armed Forces, casual workers and workers covered by the

Employee’s State Insurance Act 1948.

The Act is administered by the State Government by appointing commissioners for this purpose under S.20 of the Act.
Under this Act, compensation is payable by the employer to the workman for all personal injuries caused by industrial accidents which disable him / her for more than three days. In case of the death of workman, the compensation is paid to the dependants. The Act also specifies that in case a workman contracts any occupational disease, which is specified in its third schedule, such disease shall ordinarily be treated as an employment injury arising out of and in the course of employment. The scale of compensation is stated under the Act and the compensation is payable depending on the nature of injury and whether it is partial disablement or total disablement.

Employee’s State Insurance Act, 1948

The main object of this Act is to provide social insurance for workers. It is a contributory and compulsory health insurance scheme that provides medical facilities and unemployment insurance to industrial workers for the period of their illness.
The Act covers all workers (whether manual, supervisory or salaried employees) whose income does not exceed Rs. 7500 per month and are employed in factories, other than seasonal factories which are run with power and employ 20 or more workers. The State Government can extend the coverage of the Act with the approval of the Central Government.
The Act is administered by the Employees State Insurance Corporation (ESI), an autonomous body with representatives of the Central, State Government, employers, employees, medical profession and the parliament.


Medical benefit : An insured or a member of his or her family requiring medical help is entitled to receive medical facility free of charge in a hospital either run by ESI corporation or by any other agency.

Sickness benefits : An insured worker in case of certified sickness is entitled to receive cash payment for a maximum of 91 days in any continuous period of one year. The daily rate of sickness benefit is calculated as half of average daily wage.

Maternity benefit : An insured woman is entitled to receive cash payment calculated at a full average wage for a period of 12 weeks of which not more than 6 weeks shall precede the expected data of her confinement.

Disablement benefit : This benefit is entitled to insured worker in case of industrial accidents and injury. Compensation differs depending on temporary disablement, permanent partial disablement and permanent total disablement.

Dependent’s benefit : the benefit is available to the dependents of a deceased worker due to industrial accident or injury.

The Employee’s provident Funds and Miscellaneous Provisions Act, 1952

The Act covers workers employed in a factory of any industry specified in schedule I in which 20 or more workers are employed or which the Central Govt. notifies in its official Gazette. The Act does not apply to cooperative societies employing less than 50 persons and working without the aid of power. It also does not apply to those new establishments till they become 3 years old.
The Act is administered by Tripartite Central Board of Trustees represented by employers, employees and Government.
Under this Act

1. An employee can avail non-refundable withdrawal or take advances from the provident Fund Account for various purposes. On superannuation, the employee gets the full balance at his credit with interest.

2. Under the new pension scheme which has come into force from 16-11-1955, replacing the 1971 scheme, several types are available to an employee and his dependent.

3. Under the deposit- linked insurance scheme, the employer is required to pay to the Fund not more than one per cent of the aggregate of the basic wages, dearness allowance and retaining allowance as specified by the central government in respect of every employee employed by him.

The Maternity Benefit Act, 1961

The Act is applicable to all establishments not covered under the Employee’s State Insurance Act, 1948. The benefit will be administered by the ESI Corporation.
Under the Act a woman worker is entitled to receive the payment for maternity benefit at the rate of average daily wages for a period of 12 weeks. With effect from 1st February 1996, a woman worker is entitled to grant of leave with wages for a maximum period of one month in cases of illness arising out of miscarriage, MTP or tubectomy. Women workers who will undergo tubectomy operation will get two weeks leave.

The Payment of Gratuity Act, 1972

The object of this Act is to provide economic assistance on the termination of an employee.
The Act is applicable to the employees employed in factories, mines, oil fields, ports, railway, companies, shops or other establishments employing 10 or more persons. Under this Act, on completion of 5 years of service, the employees are entitled to gratuity payable at the rate of 15 days wages for each completed year of service subject to a maximum of Rs. 3,50,000 with effect from September 1997.

Industrial Amity and Peace

The Government has passed Industrial Disputes Act 1947. According to this Act, “industrial dispute’ means “any dispute or difference between employers and employees employers and workmen, or between workmen and workmen, which is connected with the employment or non-employment or the terms of employment and conditions of employment of any person”.
There are elaborate provisions relating to ‘Strikes and Lock-outs’. The Act also has created machinery for prevention of industrial disputes.

They are as follows:

1. Works committee

2. Standing orders

3. Code of discipline

For settlement of industrial disputes the mechanisms are

1. Conciliation

2. Arbitration

3. Adjudication

For adjudication Labour Court, Industrial Tribunal and National Tribunal are setup. The legal provisions are not elaborated since the focus is on how the Government helps human resources and their rights through legislative framework.

Trade Union Act 1926, gives permission to form and register Trade Unions with rights and duties, to strengthen their bargaining power and for obtaining rightful concessions from management. 

Tags : Human Resources Management - Personnel Environment
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