Article: Legal HR: Workplace Discrimination - Laws and Recourse for Employees

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Legal HR: Workplace Discrimination - Laws and Recourse for Employees

This article seeks to analyse the laws governing discrimination by private entities, whether employees are entitled to compensation in case of such instances as well as the consequences for employers.
Legal HR: Workplace Discrimination - Laws and Recourse for Employees

The Constitution of India is clear in its mandate – “The State shall not discriminate against any citizen on the grounds only of religion, race, caste, sex, place of birth or any of them.”  However, it is vital to note that this provision is restricted to the State and its entities, and does not cover private corporations. India lacks a comprehensive and codified anti-discrimination statute regulating employers as well as compensation for victims of discrimination. Therefore, it is pertinent to take reference from other statutes dealing with the discrimination aspects. 

Discrimination against, or profiling of individuals can occur at two stages – pre-recruitment and post-recruitment. The former entails rejecting potential candidates on the basis of their gender, religion, caste, marital status, pregnancy etc., stemming either from certain assumptions regarding their work ethic or product, or personal considerations of recruiters and so on. Post-recruitment discrimination manifests in lesser pay, fewer benefits and/or leave or even termination, based on the same grounds.

This article seeks to analyse the laws governing discrimination by private entities, whether employees are entitled to compensation in case of such instances as well as the consequences for employers.

Key Laws and Regulations

As noted above, there is no uniform, centralised law granting compensation to victims of discrimination or profiling in private enterprises. However, certain laws do exist to specifically address issues that might hamper availability of employment opportunities or other employment issues. We have summarised below these key legislations:

The Equal Remuneration Act 1976

The Equal Remuneration Act 1976 (“ERA”) is aimed to prevent gender-based discrimination in the workplace. ERA prescribes that men and women must be paid equal wages for the same (or similar) work,  and also that no such discrimination be made while recruiting for the same (or similar) work either, unless employment of women in that category of work is prohibited under applicable law . Even though employees cannot claim compensation under the ERA, they can claim the amount of wages denied to them.  Further, stringent action awaits on employer for violation of either of these provisions – he will be punished with fine and/or imprisonment, with aggravated punishment for repetition. 

The Maternity Benefit Act 1961 

The Maternity Benefit Act 1961 (“MB Act”) aims to provide paid maternity leave to women employees and related aspects. The MB Act prohibits termination of employment of pregnant woman employee and mandates maternity benefit to such women.  Further, there shall be no deduction from her wages if she is unable to perform certain strenuous tasks during the course of her employment.  The employer will be liable to be punished with imprisonment or fine under Section 21 of the MB Act, for contravention of the above provisions. The MB Act was recently amended in the year 2017 to provide for increased maternity benefit to pregnant women employees and also to provide maternity benefit to adoptive and commissioning women employees.

The Rights of Persons with Disabilities Act 2016

The Rights of Persons with Disabilities Act 2016 (“RPD Act”) is a very progressive legislation, establishing in unambiguous terms that there shall be no discrimination in Government employment against persons with disabilities.  The RPD Act includes private companies in the definition of ‘establishment’ in Section 2(i), and there is an argument to be made that the ‘non-discrimination for promotion’ principle embodied in Section 20(3) may apply to private entities too. Therefore, every establishment is required to formulate an ‘Equal Opportunity Policy’ , and every Government establishment must appoint a Grievance Redressal Officer as well .  The employer will be punishable with fine for contravention of the mandate of this RPD Act. 

The Sexual Harassment of Women at Workplace (Prevention, Prohibition And Redressal) Act 2013

Sexual harassment is the most egregious form of discrimination against women. In recognition of this, The Sexual Harassment of Women at Workplace (Prevention, Prohibition And Redressal) Act 2013 (“PoSH Act”) empowers the Internal Complaints Committee to recommend a compensatory sum to be deducted from the wages of the perpetrator and provided to the victim.  PoSH Act is fully applicable to private sector organisations by virtue of Section 2(o)(ii), and is currently the only legislation in India entitling a victim of discrimination in the workplace to avail of compensation, even if such discrimination does not occur at the hands of the employer himself. Offences punishable under the PoSH Act can also be prosecuted under Section 354 of the Indian Penal Code 1860 for criminal action against the perpetrator. 

Other Legislations

Section 2(ra) and Section 25T of the Industrial Disputes Act 1947 read with Schedule V makes dismissing workers by victimising them and favouring one set of workers over another regardless of merit an ‘unfair labour practice’ punishable with fine and imprisonment of the employer.  Amongst state laws, Section 13 of the Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017 provides that women in the workplace must not be discriminated against in matters of recruitment, training, transfers or promotion or wages, with the employer being made punishable with fine for contravention .

Conclusion

It is safe to say that even though there exists no umbrella legislation to address and compensate victims of workplace discrimination, the checks, balances and penalties laid down in the above-mentioned laws do provide substantive push to the employers to treat all employees fairly and equally. It is advisable for organisations to have an anti-discrimination policy in place, outlining the company’s commitment to equality, and prescribing a mechanism for redressal of any complaints to the contrary. Even while conducting a ‘pre-emptive screening’ before recruitment (as analysed in a previous article), employers must be sure to restrict their analysis to fundamental details such as educational and criminal background only, and must comply with requirements of prior consent and other rules under applicable privacy law.

Topics: Legal & Compliance Outsourcing

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