Politics · India Bureau
Supreme Court Narrows Labour Protections in New Industrial Code
India's Supreme Court has rejected a sweeping 1978 definition of 'industry' when interpreting the 2020 Industrial Relations Code, potentially limiting worker protections in hospitals, schools and other sectors. The nine-judge Constitutional bench voted 6-3 to overturn the precedent that had expanded labour law coverage to millions of employees.
LSN India ·
The Supreme Court's majority verdict, authored by Chief Justice Surya Kant alongside Justices Satish Chandra Sharma, Alok Aradhe and Vipul M Pancholi, marks a significant departure from decades-old labour jurisprudence. The decision establishes that the expansive definition of 'industry' established in a February 1978 seven-judge bench ruling will not guide interpretation of the new labour code.
The 1978 judgment had broadened the definition of 'industry' under the Industrial Disputes Act, 1947, extending protections to workers in hospitals, educational institutions, clubs and government welfare departments. That ruling had brought millions of employees within the ambit of formal labour law protections and dispute resolution mechanisms.
In a related 6-3 judgment, the Constitutional bench upheld the validity of the reference seeking reconsideration of the 1978 precedent, confirming that the matter was properly brought before the larger bench. This procedural ruling cleared the way for the substantive judgment narrowing labour protections under the new framework.
The verdict reflects differing judicial philosophies on labour rights interpretation, with three judges dissenting from the majority position. The Industrial Relations Code 2020 represents the government's consolidation and modernization of labour laws, though the ruling suggests its application will diverge significantly from the worker-protective stance established under the older legislation.