Inter-State Migrant Workers: Employer Obligations

Employer obligation checklist for inter-State migrant hiring

Section 61 creates a single headline duty, the annual journey allowance, but carrying it out means working through a few steps. The checklist below sets out each step, what the Code itself requires, and which part is left to the appropriate Government's rules.

Employer obligation steps drawn from Section 61 and Section 2(1)(d) of the OSH Code, 2020. Cells marked 'not stated in the Code' are values the appropriate Government sets by rules: the Code text fixes no rupee figure, service period, travel class or periodicity.

The rule in plain words

Section 61 places one clear money obligation on an employer. For every inter-State migrant worker on the rolls of the establishment, the employer owes, once in a year, a single lump sum that stands for the fare of a round trip between the place of employment and the worker's native place. This is not a reimbursement of a ticket the worker happens to buy; it is a standing annual entitlement the Code attaches to the employment relationship.

The Code deliberately does not fix the rupee figure in its own text. Instead it says the lump sum is worked out in the manner the appropriate Government prescribes, and that manner must take account of the minimum service a worker needs before qualifying, how often the payment recurs, the class of travel used to value the fare, and any other matters the rules add. So the duty is fixed by the Code, but the exact numbers live in the rules made under it.

Worked example or scenario

All inputs here are illustrative and used only to show the arithmetic. They are not statutory figures. A staffing firm recruits a worker in one State and places that worker at a client site in another State, which makes the worker an inter-State migrant worker employed in the firm's establishment.

Suppose, for illustration only, that the rules set the entitlement once the worker completes the prescribed minimum service, that the payment recurs once in the year, and that the fare is valued on sleeper-class travel. If the assumed round-trip sleeper fare between the two points is 1,800 rupees, the employer books a lump sum of 1,800 rupees for that worker that year. Change the assumed class of travel or the route and the figure moves, because the Code ties the amount to the prescribed class and to the actual to-and-fro journey, never to a number printed in the Code. Treat the 1,800 rupees, the sleeper class and the once-a-year timing purely as placeholders; the real values come from the appropriate Government's rules.

Exceptions and fine print

• The provided Code text does not itself define who counts as an inter-State migrant worker, and it states no wage ceiling, recruitment route or head-count threshold for the term. This page therefore does not state a definition; confirm it from the definitions and rules that sit outside the extract used here.
• Entitlement is conditioned on minimum service. A worker who has not yet crossed the prescribed service bar may not qualify for that year's payment, and the bar is set by the rules, not by the Code text.
• The amount is not a single national figure. It follows the prescribed class of travel and the actual route to the worker's native place, and the appropriate Government may fold in further matters it chooses to prescribe.
• Which Government's rules apply is not uniform. It turns on the establishment type under Section 2(1)(d), so two employers running different kinds of establishment may answer to different rule-makers for the same obligation.

What an employer must do

• Identify your appropriate Government under Section 2(1)(d) first, so that you apply the correct set of rules to the allowance.
• Flag every inter-State migrant worker employed in the establishment as carrying the annual journey-allowance entitlement, rather than treating it as an exception.
• Check the prescribed minimum service before treating any such worker as entitled in a given year.
• Compute the lump sum on the prescribed class of travel, measured as the to-and-fro fare between the place of employment and the worker's native place.
• Pay the lump sum within the year and on the prescribed periodicity, and carry it in your costing as a recurring, per-worker, per-year liability.

What a worker can do

• A worker who has met the prescribed minimum service can expect the annual lump sum fare from the employer of the establishment, as a matter of entitlement and not goodwill.
• Because the payment is a round-trip fare between the place of employment and the native place, a worker should be clear on which two points define the journey being valued.
• Since the amount follows the prescribed class of travel and periodicity, a worker can ask the employer which class and which cycle the appropriate Government has set, so the figure can be checked against the rules.

Who is your appropriate Government

The Code routes the detail of this obligation through the appropriate Government, so settling which Government that is comes before any calculation. Under Section 2(1)(d), the Central Government is the appropriate Government for establishments carried on by or under its authority, and for sectors such as railways including metro railways, mines, oil fields, major ports, air transport service, telecommunication service, and banking or insurance bodies established by a Central Act, along with central public sector undertakings and their subsidiaries, including the establishments of contractors working for them.

For a factory, a motor transport undertaking, a plantation, a newspaper establishment, or an establishment relating to beedi and cigar, the appropriate Government is the State Government where it is situated. The Code also clarifies that for occupational safety, health and working conditions in a factory, the State in which the factory stands is the appropriate Government. Pinning this down tells you whose rules fix the service bar, periodicity, travel class and amount for your inter-State migrant workers.

What the rules still decide

It helps to see Section 61 as a frame with four blanks that the appropriate Government fills. The first blank is the minimum service a worker must complete before the entitlement arises. The second is the periodicity, meaning how the once-in-a-year payment is timed and repeated. The third is the class of travel used to translate the journey into money. The fourth is an open category, the other matters the rules may add to the manner of payment.

For HR and payroll teams the practical takeaway is to build the allowance as a configurable rule rather than a hard-coded number. Hold the amount, service threshold, periodicity and travel class as parameters sourced from the appropriate Government's prescriptions, so that a change in the rules updates the payout without reworking the underlying obligation, which the Code itself keeps fixed.

Frequently asked questions