Labour Law in Nepal: Labour Act 2074

The New Labour Act 2074 repealed the Labor Act 2048, and has brought radical changes in the employment regime of Nepal.

Preamble of the Labour Act

Preamble of the Act has emphasized on the following matters:

1. Promoting rights , interests and benefits of labors
2. Developing good labour relations through explicit provisions on rights and duties of labors and employers
3.  Increasing productivity by ending all forms of labour exploitation.

Applicability of the Labour Act

The new labor act has removed the head count requirement for applicability which was mentioned in the previous act. The new labor act is applicable regardless of the number of labors, whereas the previous act has maintained the requirement of 10 or more people to be engaged in work or,

The definition of the term “Enterprise” has been ratified which shall mean ” Any company, private firm, partnership firm , cooperative organization or association or other organization which is established, incorporated, registered or formed or operated in accordance with the prevailing law with the objective to carry on any industry, business or service, with or without profit motive.

(The removal of head count requirement and also the inclusion of organization established even without profit motive are the major amendments made in the definition of enterprise.) 

Chapter – 2 (Basic Provision Relating to Labors)

Section 3 of the Act has expressly stated that this Act shall remain as minimum standards for labors and on matters relating to labors.

Section 10:

• Employment Contract a must to employ a person by the employer except in the case of casual employment.
• Probation Period: The new labor Act has reduced the probation period to six months which was previously of 1 year. (Section: 13)

Chapter – 4 Provisions relating to Trainees and Apprentices

Section 16 of the Act provides provision regarding employment of any person as Trainees or what we refer to as “Intern” in common usage by any enterprise after making an agreement with any educational institute, in accordance with the approved curriculum of such institute. 

Such apprentice shall not be deemed to be a labor, however, if the person is employed contrary to the approved curriculum then s/he shall be deemed to be a labor in the regular employment.

Section 17 of the Act provides safeguards to the trainee such as;

• Not to be engaged in work for more than eight hours a day and 48 hours a week, 
• Provisions relating to occupational health and safety to apply,
• To provide medical treatment or compensation if s/he suffers grievous hurt in the course of performing the work of the enterprise.

Section 18 provides the provision for employing a person as a trainee providing on the job training, the period of which shall not extend 1 year.

If any specific time period is specified by the prevailing law for a specific work or specific training period is required for it, a trainee may accordingly be employed for that period.

Conclusion

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