The Ministry of Labour and Employment is a landmark institution with a history of more than a century. It is the Ministry of the Government of India, which is concerned with the workers and their welfare, which is in charge of the implementation of labour laws and the regulation of wages, which also promotes social security to the workforce and ensures occupational safety, and moreover, it is responsible for the formulation of policies governing labour conditions. The ministry, which supervises the making of laws, is a ministerial department in the executive branch of the government. However, the Central and State governments are jointly responsible for the enforcement of these laws, and they have to pursue both at their respective levels.”
The Indian employment scenario has exhibited promising trends in 2024 -25 as official figures reveal a 3.2% dip in the unemployment rate in 2023 -24. A rise in the Worker Population Ratio (WPR) and a robust surge in the participation rate of female workers to 41.7% during 2023-2024, coupled with a cumulative increase of 16.83 jobs between 2017-18 and 2023-24, augurs well for employment trends.
We take a closer look at the Ministry of Labour and Employment’s core functions and its main welfare initiatives and assistance programs in India.
An Overview of the Ministry of Labour and Employment
The Ministry of Labour and Employment has a key role in building a strong workforce protecting workers’ rights, and helping them learn new skills in different fields A Union Minister leads this department, and a State Minister supports them The ministry comprises multiple divisions, including the Labour Bureau, the Directorate General of Employment, and the Directorate General of Factory Advice Service & Labour Institutes (DGFASLI).
Policy Goals of the Ministry
The Ministry of Labour and Employment is tasked with carrying out policy interventions in the fields of labour and industrial relations, ensuring harmony and agreement between labour and management, handling labour grievances and disputes, and fixing wages and imposing wage limits. In addition, the ministry extends its scope to improving the labour environment, occupational health and safety protocols, women’s and child labour, and social security. It is also dedicated towards the planning and execution of employment service and workforce upskilling at the national level.
It is up to the state governments to carry out these policies, as has been mentioned before, under the power and instructions of the Central Government, with the proviso that there are some exceptions, such as labour employed in Mines, Railways, and Oilfields. In the case of banking and insurance firms with branches across more than one State, Central Public Sector Undertakings, and the major ports, the Central Government maintains accountability and is liable for labour relations in relation to employment and professional development, and provides technical insights whenever required.
Organizational Framework of the Ministry
The strategic aims need to be realized by the department through its adjoining and subsidiary offices and self-governing bodies. The highest offices and agencies under the Ministry are as set out below:
- The Directorate General of Employment (DGE) is the highest body in the Ministry of Labour and Employment, which oversees the organization of employment services through Employment Exchanges, formulates national policies, regulates workplace, and enforces programs such as the National Career Service website.
- The Organization of the Chief Labour Commissioner (Central) promotes industrial harmony across national government agencies. It acts as the country’s industrial and employment relations system. It handles quasi-judicial duties. It also oversees sectors like railways, ports, mines, and banks. These are all under the central government’s watch.
- The Directorate General Factory Advice Service and Labour Institute deals with occupational safety protocols and a supportive environment in factories, dockyards, and ports.
- The Directorate General of Mines Safety audits the wellness and safety conditions of the mining team, aligns with regulatory protection, reinforces legal protective provisions, and runs awareness programs.
- The Directorate General of Labour Bureau monitors wage indicators, labour and productivity metrics, sourcing of the workforce, and workplace environment, and releases performance analytics, such as the Consumer Price Index (CPI).
- The Central Government Industrial Tribunals arbitrate industry disputes for the core domains of industries, mediate issues stipulated under the Industrial Disputes Act, 1947, and appeal proceedings connected with the Employees Provident Fund and Miscellaneous Provisions Act, 1952.
- Offices of Labour Welfare Commissioners are tasked with implementing welfare policies and allocating funds to a select group of workers.
- The Employees’ Provident Fund Organization oversees social security, insurance, and financial protection, as well as retirement savings and pensions. It oversees fiduciary operations for the Employees’ Provident Fund, the Employees’ Pension Scheme, and the Employees’ Deposit-Linked Insurance plan.
- The Employees’ State Insurance Corporation works as a statutory guarantor of social insurance and insured healthcare protection to working personnel across India. Its central work is to safeguard employees and their family beneficiaries against economic and medical hardships.
- The Central Board for Workers Education Coordinates Advancement Programs which help employees obtain education during structured, unstructured, and rural settings across India. The board also provides assistance as grants-in-aid to workers and employees associations to help develop their self-education programs.
- The V.V. Giri National Labour Institute conducts research and holds instructional sessions on labour and grievances related to employment, and also promotes partnerships with national and global enterprises to adapt to shifting labour market trends.
- The Board of Arbitration (JCM) adjudicates disagreements between the Central government and its workforce by declaring binding awards on non-negotiable issues. This independent body examines conflict cases regarding salaries, duty hours, and leave, as well as those that could not be settled through the Joint Consultative Machinery.
Functions and Role of the Labour and Employment Ministry
The Ministry of Labour and Employment in India is the custodian of labour rights and employee welfare, facilitating employment and social security across both the organised and unorganised sectors. Cultivating a collaborative and equitable workspace, the ministry performs a myriad of functions as follows:
1. Worker Benefits and Protection
- Promulgates statutory labour norms and applies wage-related governance provisions in the workplace as well as the labour and compliance environment, besides enforcing industrial relations governance and workplace hazard management.
- Subscribe to compliance norms as set forth under the Minimum Wages Act, Factories Act, Industrial Disputes Act, and Payment of Wages Act, etc.
- Fortifies the industrial relations work culture between the recruiter and the workers, and brings out a fair balance in the industrial bonhomie through proper employee grievance handling channels, adjudication frameworks, and tripartite deliberations. It supports structured collective negotiations and enables a constructive labour-management dialogue. The ministry executes the statutory obligations under the Industrial Disputes Act, 1947, and the Trade Unions Act, along with various central enactments, to foster orderly industrial relations and cooperative labour engagement.
2. Job Creation Initiatives
- Supervises the employment exchanges and career development services by way of the National Career Service (NCS) portal that links job aspirants with hirers. This site offers career guidance, skill development programs, and job postings to connect candidates to work opportunities.
- Integrates vocational training schemes to raise employability and backs apprentices or internship schemes and initiatives for skill proficiency to optimize workforce competencies with business needs and industry demands.
3. Social Security and Employee Welfare
The ministry serves as a key driver in advancing the reach of social security frameworks to workers:
- Drives schemes like Employees’ State Insurance (ESI) and Employees’ Provident Fund (EPF).
- Administers pension and insurance benefits and coverage provisions for workers engaged in structured and unstructured employment sectors.
- Backs Welfare boards and associations involved in welfare programs for agricultural and seasonal workers, construction masons, labourers, freelance and platform economy entrants.
- Implements Social Security schemes, such as Atmanirbhar Bharat Rozgar Yojana and Pradhan Mantri Suraksha Bima Yojana, as well as affordable housing schemes. It also offers smart card-attached cashless hospitalization to households below the poverty line in the unorganized and informal sector through the Rashtriya Swasthya Bima Yojana. Additionally, the department expands coverage for non-formal workers through the e-Shram website, a national database for the unorganized workforce.
4. Abolition of Child and Debt Bondage
- Executes schemes for the abolition of child labour and the amelioration of children freed from an oppressive state.
- Implements the Child Labour (Prohibition and Regulation) Act and forced labour laws.
5. Policy Making, Labour Economics, and Global Partnerships
- Formulating labour hiring policies that align with global benchmarks and national priorities.
- A regular participant at overseas conferences and cooperates at international conferences, such as the types sponsored by the International Labour Organization and G20.
- Coordinates in labour agreements, whether bilateral or multilateral, so as to secure equitable treatment and preserve the global rights of Indian workers.
- Convenes three-way consultations between workers, industry, and public authorities to strengthen collaborative governance and alignment of policy.
Active Programs under the Ministry of Labour and Employment
- Consolidation of Labour Codes: Integration of 29 central labour legislations by the ministry into four coherent and unified legislative codes:
- Industry Relations Code
- Code on Wages
- Social Security Code
- Occupational Safety, Health and Working Conditions (OSHWC) Code
- Digital Enablement: Deployment of integrated platforms like e-Shram, Shram Suviha, and NCS so as to simplify the process of compliance and broaden access to service delivery.
Administration of Key Schemes by the Ministry of Labour and Employment
These interventions are designed to expand the scope of employment, strengthen social safeguards, stimulate job creation, and improve housing access, which will advance the multidimensional welfare outcomes for the labour force and their dependent households/familial ecosystems. Here is a snapshot of some of these schemes.
1. Worker-Centric Social Protection and Welfare Measures for Workers
- Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY). These schemes serve as financial safeguards for the workforce and build economic resilience for them and their dependents during unforeseen contingencies or disability.
- PM SVANidhi Scheme assisting street vendors
- Pradhan Mantri Awas Yojana (PMAY)
- Ayushman Bharat provides free medical assistance to the underprivileged and economically disadvantaged segments of society.
2. Centrally Sponsored Schemes by the Ministry
- Labour Welfare Scheme
- Aatmanirbhar Bharat Rojgar Yojna supports employment creation post-pandemic
- National Career Service (NCS) offers job recruitment for both aspirants and employers.
- Employees’ Pension Scheme (EPS),1995
- Rehabilitation of Bonded Labourers
- Healthcare and social care are provided by the Employees’ State Insurance Corporation
3. Employment Promotion and Social Protection Initiatives
- Pradhan Mantri Garib Kalyan Yojana
4. Pension Plan for Casual or Informal Workers
- Pradhan Mantri Shram Yogi Maandhan: a voluntary scheme for pension whereby both the contributor and the government contribute to a person’s retirement fund. The government generally allocates a parallel amount as the employee contributes to foster involvement in the scheme, which supports a minimum guaranteed monthly pension after the employee reaches the age of 60 years.
Conclusion
The employment policies and social protection and income security programs of India have shaped the outcome of labour welfare, yet difficulties persist in enabling its accessibility to almost everyone and in long-term, continuous employment. Although the Employment Condition Index highlights advancement, the existence of geographical diversity and sectoral imbalances underscores the necessity for sustained reform and policy evolution. By building an organized workforce framework and formal and coherent employment practices, India can reach their goal of steady financial uplift and economic growth over time while at the same time upholding worker dignity and decent work conditions, income security and sustainable livelihoods as well as social security across the workforce and occupational categories.
