42 The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act 1979: Background, Key Definitions, Registration and Licensing, Displacement and Journey Allowance, Wages and Welfare, the COVID-19 Migration Crisis and the OSH&WC Code 2020
42.1 A Statute Born of the Sardari System
The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act 1979 was enacted in response to a long-standing pattern of exploitation. Across India — particularly in mining, construction, brick kilns, plantations, irrigation projects and dam sites — labour-supply intermediaries (called sardars or khatadars in Odisha and Bihar, maistries in Andhra) recruited workers from poor villages, transported them hundreds or thousands of kilometres to a destination state, and then put them to work in conditions over which they had little say. Wages were often delayed or unpaid; advances became tools of bondage; living conditions were unsafe; the workers had no documentation linking them to their employer. The 1979 Act tried to regulate this trade by licensing the contractor, registering the establishment of the principal employer, and providing concrete protections — including a displacement allowance and a journey allowance — for inter-state migrant workmen. The chapter ends with a look at the COVID-19 migrant crisis of 2020 and the position under the OSH&WC Code 2020.
42.2 1 · Background and Historical Context
The Act emerged from the recommendations of a Compliance Committee on Inter-State Migrant Labour set up by the Labour Ministers’ Conference (1976-77), which examined the Dadan Labour System prevalent in Odisha (then Orissa). Under the system, workers from rural districts of Odisha were taken by sardars or khatadars to brick kilns, construction sites and other work in West Bengal, Maharashtra, Gujarat and elsewhere. The system was found to involve advances against future wages — creating bondage-like conditions — and acute exploitation. The 1979 Act was the legislative response.
| Concern | Description |
|---|---|
| Exploitation by labour contractors | Sardari / khatadari / maistri systems |
| Absence of contractual transparency | No documentary link between worker and employer |
| Inferior wages and conditions | Migrant worker paid less than local worker for the same work |
42.3 2 · Object, Extent and Commencement
| Aspect | Detail |
|---|---|
| Year | 1979 (Act 30 of 1979) |
| Commencement | 11 June 1979 |
| Extent | Whole of India |
| Object | To regulate the employment of inter-state migrant workmen and to provide for their conditions of service |
| Successor | OSH&WC Code 2020 |
42.4 3 · Key Definitions — Section 2
| Term | Section | Meaning (in essence) |
|---|---|---|
| Inter-State Migrant Workman | 2(e) | A person who is recruited by or through a contractor in one state under an agreement or other arrangement for employment in an establishment in another state, whether with or without the knowledge of the principal employer |
| Contractor | 2(b) | A person who undertakes to produce a given result by inter-state migrant workmen for an establishment, other than by mere supply of goods or articles; includes a sub-contractor and a person who supplies workmen for any work |
| Principal employer | 2(g) | The person responsible for the supervision and control of the establishment (defined further by category — government departments, factories, mines, plantations, etc.) |
| Establishment | 2(d) | Any office, department, undertaking, factory, mine, etc., in which inter-state migrant workmen are employed |
| Wages | 2(j) | As defined in the Payment of Wages Act 1936 |
42.4.1 Threshold for Application
The Act applies to:
- Every establishment employing 5 or more inter-state migrant workmen on any day in the preceding 12 months.
- Every contractor employing 5 or more inter-state migrant workmen on any day in the preceding 12 months.
The Act applies at the very low threshold of five inter-state migrant workmen. This low number reflects the legislative intent to cover even small establishments and small contractors who are otherwise hard to reach. The IR Code 2020 retains this low threshold.
42.5 4 · Registration of Establishments — Sections 3 to 5
| Section | Provision |
|---|---|
| 3 | Appointment of Registering Officers by the appropriate government |
| 4 | Application for registration of every establishment employing 5+ inter-state migrant workmen — within prescribed time; fee as prescribed |
| 5 | Revocation of registration — where registration was obtained by misrepresentation or where the registration certificate has lapsed |
An establishment that is required to be registered but is not registered cannot lawfully employ inter-state migrant workmen.
42.6 5 · Licensing of Contractors — Sections 7 to 10
| Section | Provision |
|---|---|
| 7 | Appointment of Licensing Officers by the appropriate government |
| 8 | Licence required before a contractor undertakes or executes any work through inter-state migrant workmen; separate licence for each establishment |
| 9 | Conditions of grant of licence — fee, payment of wages, hours of work, holidays, etc. |
| 10 | Revocation, suspension and amendment of licence — where the conditions are violated |
42.6.1 Issue of Pass-Book to Each Migrant Worker
Under the rules made by states, each contractor must furnish each migrant worker with a pass-book in the worker’s mother tongue, containing particulars of his identity, wages payable, journey performed, advances made and other terms.
42.7 6 · Duties of Contractor — Section 12
The contractor has a number of statutory duties:
- Furnish particulars of every worker engaged to the specified authority of both the home and host states.
- Issue pass-book to each worker.
- Pay wages in cash, on time, in conditions prescribed.
- Provide suitable residential accommodation, medical facilities, and protective clothing.
- Report any accident to a worker.
- Notify termination of employment to the appropriate authorities.
42.8 7 · Special Allowances — Sections 14 and 15
The Act provides two special allowances unique to migrant workmen.
42.8.1 Section 14 — Displacement Allowance
A displacement allowance equal to 50 % of the monthly wages, or Rs 75, whichever is higher, is payable by the contractor to every inter-state migrant workman at the time of recruitment. The allowance is non-refundable and compensates the worker for the upheaval of moving to a different state.
42.8.2 Section 15 — Journey Allowance
A journey allowance of an amount not less than the fare of the journey from the place of residence in the home state to the place of work in the host state — both ways — is payable by the contractor in addition to wages. Wages are payable for the period of the journey as if the worker had actually been working.
Section 14 — displacement allowance = 50 % of monthly wages or Rs 75, whichever is higher; payable at recruitment; non-refundable. NTA stems frequently test the 50 % / Rs 75 formula.
42.8.3 Section 16 — Other Wages and Conditions
A migrant worker must receive wages at rates equal to those of other workmen performing the same or similar kind of work in the host establishment — and any case of doubt is decided by the appropriate authority. Other conditions of service — hours, leave, rest — must not be inferior to those applicable to non-migrant workers.
42.8.4 Section 17 — Responsibility for Payment of Wages
It is primarily the contractor’s duty to pay wages; if the contractor defaults, the principal employer is liable to pay the wages in full or the unpaid balance, with right of recovery from the contractor.
42.9 8 · Welfare and Health — Sections 18 to 20
| Section | Provision |
|---|---|
| 18 | Welfare facilities — drinking water, latrines and urinals, washing facilities, rest rooms, first-aid, canteen and emergency medical assistance — to be provided by the contractor for inter-state migrant workmen |
| 19 | Medical examination at periodic intervals |
| 20 | Equal wages and conditions — confirmation of Section 16 |
42.10 9 · Inspecting Staff and Dispute Resolution — Sections 20 to 25
| Section | Provision |
|---|---|
| 20 | Inspectors appointed by appropriate government — powers of entry, examination, seizure |
| 21 | Cooperation by employers and contractors |
| 22 | Disputes — any dispute about a migrant workman’s wages or other terms may be referred to the home state authority or the host state authority |
| 23 | Settlement of disputes by labour court / industrial tribunal under the ID Act 1947 — and now the IR Code 2020 |
The bidirectional dispute resolution (home or host state) is an unusual feature among Indian labour statutes — reflecting the two-state character of the employment relationship.
42.11 10 · Penalties — Sections 25 to 28
| Section | Offence | Punishment |
|---|---|---|
| 25 | Employing inter-state migrant workmen without registration / licence | Imprisonment up to 1 year and / or fine up to Rs 1,000 |
| 26 | Contravention by contractor — non-payment of allowance, wages, or facilities | Imprisonment up to 2 years and / or fine up to Rs 2,000 |
| 27 | Continuing contravention | Additional fine per day |
| 28 | Cognisance of offence | Only on complaint of inspector |
These penalties are modest under the original Act but are substantially enhanced under the OSH&WC Code 2020.
42.12 11 · Other Provisions
| Section | Provision |
|---|---|
| 6 | Effect of non-registration — establishment cannot employ migrant workmen |
| 24 | Power to make rules |
| 29 | Acts not to apply in certain cases — agricultural labour, persons paid above prescribed wage ceiling |
| 30 | Power of the central government to make rules |
| 31 | Saving — does not affect other Acts |
42.13 12 · The COVID-19 Migrant Crisis (2020)
The COVID-19 lockdown of 24 March 2020 — and the unprecedented mass-movement of inter-state migrant workers walking hundreds of kilometres to their home states — laid bare the gaps in the implementation of the 1979 Act. Three lessons emerged.
| Lesson | Description |
|---|---|
| Massive under-registration | Far fewer migrants were recorded under the 1979 Act than the actual migrant labour force — leaving most invisible to the State |
| Absence of portable benefits | Workers’ entitlements were tied to a particular state, leaving them stranded on the road |
| Need for nationwide identification and information system | A unified migrant-worker database for emergencies |
The Supreme Court took cognisance through PILs and directed the Centre and States to ensure transport, food and shelter; subsequent guidelines led to the e-Shram portal (2021) for unorganised workers and an emphasis on portability of benefits — themes carried into the Code on Social Security 2020 (which formally defined gig and platform workers and inter-state migrant workers).
42.14 13 · The Inter-State Migrant Worker under the OSH&WC Code 2020
The OSH&WC Code 2020 subsumes the 1979 Act and modernises some provisions.
| Provision | 1979 Act | OSH&WC Code 2020 |
|---|---|---|
| Definition of inter-state migrant worker | Through contractor only | Expanded — also includes a worker who has come on his own from one state to another and earns up to a notified wage ceiling |
| Threshold | 5 migrant workmen | Continued; wider in some respects |
| Registration of establishment | Required | Continued; simplified online process |
| Licensing of contractor | Required | Continued |
| Displacement allowance | 50 % of wages or Rs 75 | Removed in some interpretations; lump-sum amount notified |
| Journey allowance | Equal to fare | Continued |
| Wages | Equal to local workers | Continued; portable Aadhaar-based PDS through “One Nation One Ration Card” |
| Pass-book | State rules | Continued; portable record |
| Dispute resolution | Home or host state | Continued |
| Penalties | Modest | Substantially enhanced |
The Code on Social Security 2020 also recognises the inter-state migrant worker as a category for whom schemes can be specifically framed.
42.15 14 · Significance and Critique
- First Indian statute to address inter-state labour migration specifically.
- Created a two-state regulatory architecture unique among Indian labour laws.
- Introduced the concept of a displacement allowance — an early form of compensation for the social cost of migration.
- Critique: implementation has been notoriously weak; only a small fraction of actual migrant workers are registered; many contractors operate without licence; enforcement is uneven across states.
- COVID-19 lessons have re-energised policy attention to migrant workers and led to the e-Shram portal, One Nation One Ration Card, and statutory recognition under the Code on Social Security 2020.
42.16 Practice Questions
The Inter-State Migrant Workmen Act was enacted in:
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The 1979 Act applies to every establishment employing how many inter-state migrant workmen?
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Under Section 14, the displacement allowance is:
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Under Section 15, journey allowance is at least equal to:
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The "Dadan Labour System" addressed by the 1979 Act was historically associated with:
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An "inter-state migrant workman" under Section 2(e) is a person:
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If the contractor defaults in paying wages, who is liable to pay them under Section 17?
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Under the 1979 Act, a pass-book must be furnished to:
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A dispute about a migrant workman's wages may be raised in:
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Match the section with its content:
| (i) | Section 4 | (a) | Journey allowance |
| (ii) | Section 8 | (b) | Registration of establishment |
| (iii) | Section 14 | (c) | Licence to contractor |
| (iv) | Section 15 | (d) | Displacement allowance |
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Under Section 16, the wages of a migrant worker must be:
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The Indian COVID-19 lockdown that exposed gaps in migrant-worker registration was announced on:
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The e-Shram portal for unorganised workers (including inter-state migrants) was launched in:
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The "One Nation One Ration Card" scheme primarily addresses which migrant-worker concern?
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Section 12 of the 1979 Act lays down the duties of:
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The 1979 Act has been subsumed within:
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Section 18 mandates which of these facilities for inter-state migrant workmen?
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The Compliance Committee on Inter-State Migrant Labour leading to the 1979 Act was set up by the:
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Section 4 of the 1979 Act deals with:
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Section 29 of the 1979 Act provides that the Act does not apply to:
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42.17 Quick Recall
- Inter-State Migrant Workmen Act 1979 — enacted following recommendations of the Labour Ministers’ Conference 1976-77 to address the Dadan / sardari / khatadari / maistri systems of migrant-labour recruitment, particularly from Odisha.
- Definition (Section 2(e)): a person recruited by or through a contractor in one state for work in another state.
- Threshold: applies to establishments and contractors employing 5+ inter-state migrant workmen.
- Registration of establishment (Sections 3-5) and licensing of contractor (Sections 7-10) required.
- Pass-book in mother tongue to each worker.
- Section 14 — Displacement allowance = 50 % of monthly wages or Rs 75, whichever higher; non-refundable.
- Section 15 — Journey allowance = at least the fare of journey from home state to host state and back; wages payable during the journey.
- Section 16 — Equal wages and conditions as local workers in the host establishment.
- Section 17 — Principal employer liable to pay wages if contractor defaults; right of recovery from contractor.
- Section 18 — Welfare facilities (drinking water, latrines, washing, first-aid, canteen, rest room, medical assistance) provided by contractor.
- Section 22 — Disputes may be raised in either home or host state — bidirectional jurisdiction.
- Section 29 — exclusions (agricultural labour, employees above wage ceiling).
- COVID-19 lockdown (24 March 2020) exposed massive under-registration and led to e-Shram portal (2021), One Nation One Ration Card, and stronger statutory recognition under the Code on Social Security 2020.
- Subsumed within OSH&WC Code 2020 — definition expanded to include workers who migrate on their own (not just through contractor) up to a notified wage ceiling.