One can argue that manufacturing is at the heart of all industry. Statutory compliance in the manufacturing industry is crucial to the safety of its workers, the quality of the products and services delivered and to the reputation of the company itself. And this is where a statutory compliance checklist for manufacturing companies becomes so crucial.
The Government cares for employee welfare but also wants organisations to succeed. For this, the Government has created statutory schemes. These schemes are instituted by the government to guarantee employee health and safety. These include the provisions made under enactments such as the Factories Act 1948, the Mines Act 1962 etc.
If you are a manufacturing company, then you must have a statutory compliance checklist in accordance with the Factories Act of 1948 amended in several amendments since then; one that you follow regularly and adhere to without exception. But what exactly is statutory or regulatory compliance in the manufacturing industry?
Statutory compliance in HR refers to the efforts made by a company to comply with labour laws and regulations set by the state and central governments. In the context of the manufacturing industry too, there is statutory compliance that companies must follow for the sake of employee welfare and to keep the brand reputation intact.
In the case of statutory compliance for the manufacturing industry, it is possible that in certain domains, such as minimum wage laws, only directives from specific state governments exist whereas other domains may have both state and central laws. A statutory compliance checklist for manufacturing companies can help clear the air when it comes to clarifying whether laws are being followed.
There are several issues in statutory compliance possible on the industrial floor. Many of these statutory or regulatory compliance issues can seriously hamper the functioning of the enterprise. Let us look at some of the common issues now:
Child labour is a rampant problem in India. Several factories still employ children in their factories. Organisations are looking at ways of cheap labour through apprentices. Though apprentices are eligible to work on the factory floor, they too have some minimum requirements such as a fifth-grade qualification and other skill requirements.
Workers in the factories in many parts of India are underpaid and not even offered minimum wages. The state governments have fixed minimum wages which must be followed in each state but not everyone abides by it. Not paying minimum wages can lead to employee mistrust and risk of interventions from labour unions, low engagement levels, and lower productivity levels.
Working beyond the 9 hours of work stipulated by the government is unfortunately a norm in many factories across India. When people are overworked, their stress levels increase, errors in production also lead to product quality issues, which will eventually lead to customer dissatisfaction. If workers are working overtime, then they must be paid overtime pro rata, failing which the company does not follow statutory compliance.
The Occupational Safety and Hazard Management Code (OSH) stipulates that workers can have an open discussion with their floor supervisors on safety conditions and that they must be informed of the potential risks of employment and other hazards on the floor before they begin the work. Workers must also be offered sufficient compensation in the case of accidents under the provisions of the code.
All of these are sufficient reasons why a statutory compliance checklist for manufacturing companies is very necessary.
The legal statutory compliance checklist for manufacturing companies includes several points that companies must adhere to. Let us look at some of these points now.
Quality Assurance
We hope you found that statutory compliance checklist for manufacturing companies a useful one. A safe workplace (in this instance, a safe factory) is a result of not only aligning the workplace policies with the laws and regulations laid down by the government but also securing the cooperation of the employees in making it happen. This could be a balancing act not all companies are necessarily prepared for, and it not only costs additional resources but takes away from the time that can be spent on other strategic activities.
Did you know for instance that you could recruit apprentices under the NAPS Act of 2016 for your factories, but that they should meet certain minimum requirements for age and skill levels. Did you also know that you are eligible for reimbursement from the government during both their training and work on the factory floor under NAPS?
Alp Consulting can partner with you in your NAPS journey and to ensure statutory compliance on the factory floor and even help you manage your payroll effectively. As an HR consulting company with over 25 years of experience, you can count on us to manage all functions of HR for you, right from recruitment and staffing to payroll and compliance. When are you talking to us, and how can we help?