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CMA Intermediate · Business Laws and Ethics

Factories Act, 1948: formula sheet

Full chapter guide

Key formulas

Appointment of Inspector-cum-Facilitators
Section 34(1): appropriate Government, by notification, appoints; each officer acts within the jurisdiction specified
Appointment is always by notification.
Inspection scheme
Section 34(3): web-based inspection, calling of information electronically, randomised selection of establishment and officer
Scheme is laid down by the appropriate Government by notification.
Scheme design factors
Section 34(4): (a) unique numbers; (b) timely uploading of reports; (c) special inspections; (d) nature of work and workplace
The unique number of an establishment equals its registration number under section 3.
Chief and senior officers
Section 34(5)-(7): Chief Inspector-cum-Facilitator; Additional, Joint, Deputy Chiefs exercise Chief's powers as notified, plus Inspector-cum-Facilitator powers in their local limits
A Chief may be appointed for a State, several States or the whole country.
Disqualification
Section 34(8): no person who is directly or indirectly interested in a workplace, work activity, process, business, plant or machinery connected with it may be appointed or continue in office
Ensures independence.
Status
Section 34(11): deemed public servant under section 21 of the Indian Penal Code; officially subordinate to authority specified by the appropriate Government
Applies to all officers appointed under section 34.
Powers of Inspector-cum-Facilitator
Section 35(1)(i)-(xiv): enter, inspect, inquire, require documents, search or seize, take samples, issue show cause notice, prosecute
Powers are subject to any rules made.
Duty to produce documents
Section 35(2): a person required to produce a document or give information is legally bound to do so (IPC sections 175 and 176)
Refusal has legal consequences.
Search and seizure procedure
Section 35(3): Code of Criminal Procedure, 1973 applies so far as may be, as to a search under a warrant under its section 94
Procedure follows the criminal procedure law.
Ventilation and temperature duty (Factories Act, s.13(1))
Adequate ventilation by circulation of fresh air + temperature giving reasonable comfort and preventing injury to health
Applies to every workroom. Walls and roofs must keep temperature as low as practicable.
High temperature measures (s.13(1)(ii))
Separate the process from the workroom, insulate hot parts, or use other effective means
Only 'adequate measures as are practicable' are required.
Standards and records (s.13(2))
State Government prescribes standards; may direct measuring instruments and records
The State, not the Centre, prescribes under the Factories Act.
Chief Inspector's order (s.13(3))
Written order to occupier specifying measures + a date by which to carry them out
Issued where excessively high temperatures can be reduced by suitable measures.
Dangerous operations (Factories Act s.87)
Serious risk of bodily injury, poisoning or disease → State Government rules
Rules can declare the process dangerous, restrict employment of women, adolescents or children, require medical examination, and require protective equipment.
Safety Committee (s.41G)
Hazardous process or substances → Safety Committee, equal workers' and management representatives
The State Government may exempt by written order, with reasons recorded.
Dangerous operations (OSH Code s.82)
Appropriate Government rules: specify and declare dangerous; restrict pregnant women; periodic medical examination at occupier's cost; welfare and protective equipment
Medical examination is at the occupier's cost.
Employer responsibility (OSH Code s.23)
Employer maintains health, safety and working conditions as prescribed by the Central Government
Matters include ventilation, temperature, humidity, drinking water, lighting, latrines, waste treatment.
Disclosure for hazardous process (OSH Code s.84)
Disclose dangers to workers, Chief Inspector-cum-Facilitator, local authority and public; lay down health and safety policy; on-site emergency plan; inform 30 days before starting a new hazardous process
Breach of the 30-day intimation makes the licence under section 79 liable for cancellation.
Daily limit (OSH Code, Section 25(1))
Maximum work = 8 hours in a day
Intervals and spread overs are as notified by the appropriate Government.
Weekly limit (Section 26(1))
Maximum work = 6 days in any one week
Government may exempt workers by notification on prescribed conditions.
Compensatory holidays (Section 26(3))
Holidays given = holidays lost, within the month due or the 2 months immediately after
Applies when an exemption deprives the worker of weekly holidays.
Overtime wages (Section 27)
Overtime pay = 2 × ordinary rate of wages × overtime hours
Daily or weekly basis, whichever is more favourable to the worker. Worker's consent required.
Factories Act exceptional press of work (Section 65(3))
≤ 12 hours a day; spread over ≤ 13 hours; ≤ 60 hours a week including overtime; overtime ≤ 7 days at a stretch; overtime ≤ 75 hours a quarter
Conditions for exemptions under Section 65(2) of the 1948 Act.
Factories Act weekly holiday (Section 52)
Whole-day holiday on one of the 3 days before or after the first day of the week; no more than 10 consecutive days without a whole-day holiday
Notice to the Inspector and a displayed notice are needed before the day.
Qualifying days: Factories Act, 1948 (Section 79)
Worked 240 days or more in a calendar year → leave in the next calendar year
Lay-off days (by agreement, contract or standing orders), maternity leave up to 12 weeks and leave earned in the prior year count towards 240 days but earn no leave.
Leave rate: Factories Act, 1948
Adult: days worked ÷ 20. Child: days worked ÷ 15
Fraction of half a day or more counts as one full day; less than half a day is dropped.
Part-year joiner: Factories Act, 1948
Entitled if worked two-thirds of the total days in the remainder of the calendar year
Applies to a worker whose service starts other than on 1 January.
Carry-forward: Factories Act, 1948
Maximum 30 days (adult) or 40 days (child)
Leave refused despite a valid application can be carried forward without limit.
Qualifying days: OSH Code, 2020 (Section 32)
Worked 180 days or more in the calendar year → leave in that year
Lay-off, maternity leave and annual leave availed count towards 180 days but earn no leave.
Leave rate: OSH Code, 2020
Ordinary worker: days worked ÷ 20. Adolescent worker: ÷ 15. Below-ground mine worker: ÷ 15
The text of Section 32 gives no half-day rounding rule, so do not import the 1948 Act rounding rule.
Part-year joiner: OSH Code, 2020
Entitled if worked one-fourth of the total days in the remainder of the calendar year
Compare with two-thirds in the 1948 Act.
Carry-forward and encashment: OSH Code, 2020
Carry forward up to 30 days; encash leave exceeding 30 days; encash on demand at year end
Leave refused on application is carried forward without limit.
Application for leave: Factories Act, 1948
Written notice at least 15 days before (30 days for public utility service); leave taken at most 3 times a year
Illness leave need not meet the notice period.
Section 127(1): general exemption
Appropriate Government + notification + conditions + period → all or any provisions do not apply to an establishment or class
Covers the Code, its rules and its regulations.
Section 127(2): new factories
State Government + public interest (economic activity and employment) + notification → exemption from date commercial production starts
Period is specified in the notification. Earlier Factories Act notifications continue for their remaining period.
Section 58: emergency
Emergency + notification + conditions + specified period → provisions do not apply
Applies to an establishment, a class of establishments or a class of contractors.
Section 91: persons and workers
Rules for supervisory, managerial or confidential persons; rules for workers; written order for adult workers
Section 91(2): the appropriate Government or the Chief Inspector-cum-Facilitator may exempt adult workers by written order.
Section 129: public institutions
Workshop attached to an educational, training, research or information institution → exemption on conditions
No exemption from hours of work and holidays unless an approved scheme is not less favourable than the Code.

Quick revision

  • Know the definitions of factory, worker, occupier and manufacturing process word for word.
  • The occupier is the person with ultimate control over the affairs of the factory.
  • Learn the duties of the employer, occupier and inspector-cum-facilitator separately.
  • For health and safety, group provisions into health, safety and welfare.
  • Memorise the daily and weekly hour limits and interval rules exactly as in your study material.
  • Remember the weekly holiday rule and the compensatory holiday concept.
  • Overtime questions need the limit, the rate and the conditions stated together.
  • Women and young persons have special conditions on hours and types of work.
  • Annual leave depends on days worked, so check the eligibility condition in the question.
  • Exemptions apply only in special cases and under stated conditions.
  • In penalty questions, name the breach and state the consequence, not just the word penalty.
  • Write answers in this order: rule, limit, application, conclusion.

Common mistakes

  • Calling the officer only an Inspector and ignoring the facilitator role. Fix: State that the officer also supplies information and sensitises employers and workers (section 35(1)(v)).
  • Writing that the Factories Act, 1948 section numbers apply. Fix: Cite the OSH Code, 2020 sections 34 and 35 for the officer.
  • Mixing up the Factories Act, 1948 and the OSH Code, 2020 section numbers. Fix: Link them: section 87 is the Factories Act, section 82 is the OSH Code. Always name the Act.
  • Saying the temperature must be kept low in all cases. Fix: The law requires reasonable comfort, no injury to health, and temperature kept as low as practicable in walls and roofs design.
  • Paying overtime at one and a half times the wage. Fix: Section 27 says twice the rate of wages. Write 2× every time.
  • Treating the 12-hour and 60-hour limits as the normal limits. Fix: Normal limit is eight hours a day under Section 25. The 12, 13, 60 and 75 figures apply only to exemptions for exceptional press of work.
  • Using 240 days for OSH Code questions, or 180 for the Factories Act. Fix: Tie each number to its law: 240 with 1948 Act, 180 with OSH Code.
  • Counting lay-off or maternity days as days that earn leave. Fix: They count only towards the threshold. Compute leave on days actually worked.
  • Citing the Factories Act, 1948 sections as current law. Fix: Use the OSH Code sections. Mention the 1948 Act only for the saving of old notifications under section 127(2).
  • Saying any exemption can be given without conditions or time limit. Fix: Always write that conditions, restrictions and a period may be specified.

Exam tips

  • Write section 34 for appointment and section 35 for powers, and keep them apart.
  • In MCQs, watch for options that say the Chief Inspector appoints or that inspection is always at the officer's discretion. Both are wrong.
  • For a six-mark list, give at least six distinct powers from section 35(1) with one-line explanations.
  • Mention the facilitation role; it is a favourite scoring point.
  • For employer and occupier duties and registration, use your ICMAI material and give a clear, structured list rather than guessing section numbers.
  • Always name the Act. Examiners reward the correct source, and the two Acts have different section numbers.
  • Use the numbers precisely: thirty days, equal representation, occupier's cost. MCQs test these.
  • For long answers, structure by sub-heading: ventilation, temperature, hazardous process, dangerous operations, welfare. Each earns step marks.