Standing Orders and the IR Code – Another betrayal of the Industrial Working Class

The stated objective of the Industrial Employment (Standing Orders) Act, 1946, was two-fold – firstly, it was thought to be expedient to require employers in industrial establishments to define with sufficient precision the conditions of employment under them and secondly, that the said conditions be made known to workmen employed by them.

Pursuant to this pre-constitutional enactment, workers in industrial establishments across the country have fought to better their service conditions and achieve better standards of certified standing orders. Importantly, the Act was a tool that served to protect workers from arbitrary action of managements – now, the Rules governing both the workers and the management were defined and published for all to see.

Not only this, but the Rules could be tested and modified on the touchstone of fairness and reasonableness. While the IR Code maintains this standard of fairness and reasonableness, it brings in a number of anti-labour provisions that further tip the unequal scale in favour of the management.

Model Standing Orders by Union Government Only

Repeatedly through the Codes, we have seen indications of how the Union Government is consolidating power and violating federalism – for example, we see that the term appropriate government allows the Central Government to retain control over an establishment even after privatization. In respect of standing orders, the IR Code now mandates that the Model Standing Orders will be prepared by the Union Government. These Model Standing Orders will be applicable across the Board unless and until the certified standing orders come into force in the establishment.

The necessary corollaries of this move are as follows: Firstly, the Union government has the power to impose regressive and anti-worker procedures across the country for all establishments. Secondly, the model standing orders are uniformly applicable in states that are in very different conditions, without being moulded to the realities of the state.

It must be remembered that the welfare of labour, including conditions of work, is a subject that falls within the concurrent list of the Seventh Schedule of the Constitution of India, which means that both the Union Government as well as the State Government are entitled to legislate on the topic. However, the Code is being used as a tool to deprive the states of their constitutional authority.

Importantly, Section 29 states that the Model Standing Orders framed by the Central Government would apply to the establishment from the date the provision becomes applicable to an establishment and till the date standing orders certified under the Code come into force. Therefore, establishments without standing orders would now be bound by these Model Standing Orders made by the Central Government.

Management Proposals are Deemed Certified if Officer Delays!

Another move with far reaching consequences is the proviso the Section 30 (5) whereby, the application for certification of standing orders or modification would be required to be completed within sixty days of procedures of seeking comments and giving opportunity of hearing, failing which such draft standing orders or modifications in the standing order shall be deemed to have been certified on the expiry of the said period. There is no provision that if the delay is on account of the management or unavoidable for any reason, it may be condoned. Importantly, this provision relates to proposals of the management only on coming into force of the Code. Hence, the worker can be denied of his opportunity to file objections and to be heard on account of no fault of their own.

Pushing Fixed Term Employment even in Standing Orders

For a while, the corporate crony BJP Government has been pushing fixed term employment into labour law, which permits the treatment of workers as dispensable commodities. In Karnataka, in fact, the government notified amendment rules in June 2020 including Fixed Term Employment as a classification of employment. In the First Schedule to the IR Code now, fixed term employment is also included as a classification of employment. This will enable increasing job insecurity for workmen, and sacrifices long term stability of workers for “ease of business”.

Certain Standard Problematic Clauses

Throughout the Codes, certain standard changes have been made that are contrary to the interests of workers, some of which are reflected in the provisions on standing orders as well.

One such change is the repeated shift from mandate through prescription by way of rules which must be placed before the legislature and are also subject to the condition of prior publication, to notification, which is based to the arbitrary discretion of the government and not accountable either to the legislature or to the people. Insofar as standing orders are concerned, the Schedule of the 1946 Act was permitted to include any other matter as prescribed, whereas the corresponding provision in the First Schedule of the IR Code is any other matter as may be notified. Similarly, the appeal procedure is as prescribed in the Code, which means that the statutory mandate of prior hearing etc. is done away with.

Another standard change is the changing of applicability standards to reduce coverage of beneficial provisions. The Code now reduces the mandate for standing orders from establishments with 100+ workers to establishments with 300+ workers, effectively ensuring that workers in medium size establishments are not entitled to standing orders.

On Subsistence Allowance

Another retrograde change in the IR Code is the deletion of clause 10(3) of the 1946 Act, which provided that if there are more beneficial provisions relating to payment of subsistence allowance under any other law, that would continue to apply notwithstanding anything in the Act. In this regard, in Karnataka, workers are entitled to 90% subsistence allowance if suspension extends beyond 180 days for reasons not directly attributable to the worker in terms of the Karnataka Payment of Subsistence Allowance Act, 1988. However, when the Code comes into force, the Karnataka Act would be inapplicable to workers in establishments covered therein, depriving workers of the more beneficial provisions.


Finally, one of the most vital provisions of the 1946 Act, mandating that the text of the standing orders be prominently posted by the employer in English and in the language understood by the majority of his workmen on special boards to be maintained for the purpose near the entrance and in each department of the establishment has been deleted. Under the Code, the only requirement is that the Standing Orders be maintained by the employer in such language and in such manner for the information of the concerned workers as may be prescribed. This distorts the base objective of Standing Orders themselves, namely that the conditions of employment be made known to workmen employed by them.

Finally the words of the Supreme Court in U.P. State Electricity Board and Another vs Hari Shanker Jain and Others. 1980 AIR 65 must be remembered.

“Before the passing of the Act, conditions of service of industrial employees were invariably ill-defined and were hardly ever known with even a slight degree of precision to the employees. There was no uniformity of conditions of service for employees discharging identical duties in the same establishment. Conditions of service were generally ad-hoc and the result of oral arrangements which left the employees at the mercy of the employer. With the growth of the trade union movement and the right of collective bargaining, employees started putting forth their demands to end this sad and confusing state of affairs. Recognizing the rough deal that was being given to workers by employers who would not define their conditions of service and the inevitability of industrial strife in such a situation, the legislature intervened and enacted the Industrial Employment (Standing Orders) Act... The Industrial Employment (Standing Orders) Act is thus seen to be an Act specially designed to define the terms of employment of workmen in industrial establishments, to give the workmen a collective voice in defining the terms of employment and to subject the terms of employment to the scrutiny of quasi-judicial authorities by the application of the test of fairness and reasonableness. It is an Act giving recognition and form to hard-won and precious rights of workmen.”

The changes made by the Codes effectively dilute these hard won and precious rights of workers and promote disorganization of labour. As such, there is a requirement to mount a legal and political challenge to the Codes. νν