Laws Governing Establishment of Factories
🏭 Laws Governing
Establishment of Factories
(Factories Act, 1934 – Pakistan)
Lecture Notes for Business Students
6.1 Definitions Pertained to the Factories Act, 1934
- Factory:
A premises where 10 or more workers are working with power or 20
or more without power, involved in manufacturing.
- Worker:
A person employed in a factory, directly or through an agency, for wages.
- Occupier:
A person who has ultimate control over the affairs of the factory.
- Manufacturing
Process: Includes making, altering, repairing, finishing, etc.
Example: A textile unit employing 30 workers is a
"factory".
6.2 Exemption from Certain Provisions of the Act
The government may exempt:
- Seasonal
factories (e.g., sugar mills)
- Small-scale
or emergency-run factories
Purpose: Flexibility in rules for special scenarios
6.3 Inspectors and their Powers
Inspectors are appointed to:
- Enter,
inspect and examine any factory
- Inquire
into accidents or complaints
- Prosecute
violations
Example: A factory inspector checks for child labor
and unsafe equipment.
6.4 Certifying Surgeons
Certified doctors appointed to:
- Examine
health of workers, especially adolescents
- Issue
fitness certificates
Relevance:
- Ensures
no underage or unhealthy person is working
6.5 Health and Safety
Factories must maintain:
- Clean
premises
- Proper
ventilation
- Drinking
water
- Safe
machinery
Example: Installing safety guards on textile looms.
Business Benefit: Reduces workplace injuries, boosts
productivity
6.6 Disposal of Wastes and Effluents
Factories must:
- Dispose
of industrial waste properly
- Avoid
pollution of water and land
Example: Dye factory installing wastewater treatment.
Relevance: Environmental compliance and corporate
reputation
6.7 Artificial Humidification
Regulates moisture control (mainly in textile factories) to:
- Prevent
respiratory problems
- Maintain
healthy air quality
Example: Use of humidifiers must meet legal
standards.
6.8 Vaccination and Inoculation
Workers must be:
- Vaccinated
against diseases (e.g., Hepatitis, Typhoid)
Factory Role: Management must ensure medical programs
in collaboration with health departments.
6.9 Holidays with Pay and Provisions of the Act for
Workers
- Annual
leave: 14 days with pay after 12 months of service
- Sick
leave: 10 days with half-pay
- Festival
holidays: As notified
Benefit for Workers: Promotes well-being and reduces
burnout
Benefit for Business: Employee satisfaction and loyalty
6.10 Special Provisions for Adolescents and Children
- Children
(<14 years): Prohibited from factory work
- Adolescents
(14–18 years): Can work only if certified fit
- Restricted
working hours
Example: A 16-year-old must have a fitness
certificate and work limited hours.
6.11 Penalties and Procedure
For non-compliance:
- Fines
up to Rs. 500 (first offense)
- Imprisonment
or higher fines for repeat offenses
Example: Fine for not providing safety gear.
6.12 Penalty for Contravention of Act and Rules
- Specific
penalties outlined for violating sections (health, hours, child labor)
- Legal
action initiated by Factory Inspector
6.13 Display of Factory Notices
Factories must display:
- Working
hours
- Holidays
- Name
and address of factory
- Safety
instructions
Example: A board showing first aid info near
workshop.
Importance: Transparency and worker awareness
6.14 Publication of Rules
Government must:
- Publish
all changes and updates in the Official Gazette
- Ensure
rules are accessible to stakeholders
Business Relevance:
- Stay
legally compliant
- Avoid
legal disputes
6.15 Protection to Persons Acting under this Act
Inspectors and officials are protected from lawsuits if:
- Actions
were done in good faith while enforcing the law
Purpose: Encourage strict law enforcement without
fear of retaliation.
🎓 Business Student
Advantages
|
Legal Topic |
Business Relevance |
|
Factory Definition |
Helps in planning legal establishment |
|
Health & Safety |
Reduces accidents & legal risk |
|
Waste Disposal |
Ensures environmental compliance |
|
Workers’ Rights |
Enhances corporate reputation |
|
Child Labor Laws |
Avoids legal penalties, CSR issues |
|
Leave Provisions |
Helps design ethical HR policies |
|
Inspections & Fines |
Risk management in operations |
|
Medical Provisions |
Enhances employee welfare |
✅ Conclusion
Understanding the Factories Act, 1934 is essential
for business students to:
- Ensure
legal compliance
- Design
fair labor policies
- Run
ethical and sustainable businesses
- Mitigate operational and legal risks
