Motor Transport Workers Act, 1961: Employer Guide
Table of Contents
On 21 November 2025, the government implemented the OSH Code, 2020 along with three other labour codes. Subsequently, in December 2025, it released draft central rules for public comments. The final central rules followed on 8 May 2026. The OSH Code replaces 13 older labour laws. The Motor Transport Workers Act, 1961 is one of them. This guide explains what the old law covered, what has changed for drivers and conductors, and which policies employers must update.
Key Takeaways
- The OSH Code increases the applicability threshold for motor transport undertakings from 5 to 10 or more workers.
- Workers now qualify for annual leave after completing 180 days of work, down from 240.
- Overtime remains payable at double the ordinary wage rate, but now requires the worker’s explicit consent.
- Registration is fully digitized; existing registrations transition under the new Code provided details are updated.
- State government regulations will continue to govern specific operational rules for transport businesses.
- Legacy state rules remain valid only where they do not conflict with the central OSH Code.
What is the Motor Transport Workers Act, 1961?
The Motor Transport Workers Act, 1961 is a central law that protects people working in road transport. It sets rules on hours, rest, overtime, leave, and welfare. The Act applied to undertakings engaged in the transport of passengers or goods by road for hire or reward, such as city bus operators and commercial trucking firms.
It covered drivers, conductors, cleaners, booking clerks, and depot staff, including agency-engaged personnel.
Why did the Law Matter?
Due to the demanding nature of transport work, which involves long-distance routes, overnight halts, and irregular shifts, the Act established statutory caps on working hours and ensured essential welfare measures.
Who does the Law Apply to Now?
The Motor Transport Workers Act, 1961 applied to undertakings with five or more motor transport workers. States could also extend it to smaller units after two months’ notice.
The OSH Code sets a higher threshold. Under the Code, a motor transport undertaking is an “establishment” once it employs 10 or more workers. The definitions of “motor transport undertaking” and “motor transport worker” remain almost the same.
Both laws exclude people employed in a factory or covered by a shops and establishments law.
For example, a courier firm with seven drivers was covered under the older law. Under the Code, the same firm falls outside the law’s scope until it employs 10 or more workers.
Key Provisions of the Motor Transport Workers Act, 1961 and the OSH Code
The following breakdown compares the requirements under the Motor Transport Workers Act, 1961 with the updated mandates under the OSH Code.
Working Hours and Spread-Over
The Act capped adult work at 8 hours a day and 48 hours a week. On approved long-distance routes, the limit could go up to 10 hours a day. It also capped the spread-over, meaning the total duty span with breaks, at 12 hours.
The Code retains the 8-hour daily limit but leaves rest intervals and spread-over to the appropriate government. Working hours include driving time, subsidiary work such as loading and unloading, and short waits at terminals.
Rest Intervals and Weekly Rest
The Act gave workers a half-hour break after five hours of work. It also required nine straight hours of rest between two duties. While work on scheduled rest days was permitted under strict conditions, continuous work without a rest day was limited to 10 consecutive days.
The Code allows a maximum of six working days a week. For motor transport, the Code keeps the older flexibility. An employer may ask a worker to work on the weekly holiday, but must allow a full day off within the following 10 days.
Overtime
The Act required employers to pay overtime at twice the ordinary rate of wages, which comprised basic wages and dearness allowance. The Code also requires payment at twice the wage rate. Additionally, it makes overtime subject to the worker’s consent. Overtime must be calculated on a daily or weekly basis, whichever yields a higher benefit to the worker.
Annual Leave with Wages
Earlier, the Act required a worker to complete 240 days of work in a calendar year to qualify for annual leave. Adults earned one day of leave for every 20 days worked. Adolescents earned one day for every 15 days worked.
Now, the Code lowers the eligibility to 180 days. The earning rate stays the same. Workers can carry forward up to 30 days of leave and encash it at the end of the year.
Welfare and Health Facilities
The 1961 Act required canteens where 100 or more workers report daily. It also required restrooms at night halts, uniforms, medical facilities, and a first-aid box in every vehicle.
Although these are welfare benefits, the OSH Code now covers them. It provides for uniforms, raincoats and medical facilities at operating centers. It also requires separate rest rooms for men, women and transgender workers at night halts. The canteen requirement continues to apply where 100 or more workers are employed, including contract workers.
Children and Adolescents
The Act did not allow children to work in any capacity. Adolescents were required to carry a certificate of fitness and a token at work. Under the Code, adolescents’ working conditions are governed by the Child and Adolescent Labour (Prohibition and Regulation) Act, 1986.
Registration, Registers and Returns
The Act made registration mandatory, and state rules set the forms.
The OSH Code mandates electronic registration within 60 days of applicability. Units already registered under an older central labour law are considered registered once they share their details. Employers must also maintain registers of working hours, wages, leave, and overtime, issue wage slips, and file returns.
Motor Transport Workers Act, 1961 vs OSH Code: What Changed for Employers?
The comparative table below outlines the primary updates and retained provisions under the new regulatory framework to assist in reviewing organizational policies, payroll configurations, and duty rosters.
| Area | Motor Transport Workers Act, 1961 | OSH Code, 2020 |
|---|---|---|
| Coverage | The Act covered units with 5 or more workers. | The Code covers units with 10 or more workers. |
| Daily hours | The limit was 8 hours, or 10 on approved routes. | The limit is 8 hours a day. |
| Spread-over | The Act capped it at 12 hours. | Subject to limits prescribed by the appropriate government. |
| Weekly rest | Workers could not work for more than 10 days without rest. | The Code keeps the same 10-day limit. |
| Overtime | Workers got twice their basic pay plus DA. | Workers get twice the wage rate, with consent. |
| Annual leave | Workers needed 240 days of work. | Workers need 180 days and can encash leave at year-end. |
| Registration | State-level manual or statutory registration. | Unified electronic registration; existing registrations remain valid/deemed recognized. |
| General penalty | The Act imposed fines of up to ₹500 or imprisonment of up to 3 months. | The Code replaces this with a fine of ₹2 lakh to ₹3 lakh. |
Is the Motor Transport Workers Act, 1961 Still Applicable?
No, the Motor Transport Workers Act, 1961 no longer applies. Section 143 of the OSH Code repeals it, along with 12 other labour laws, and the Code came into force on 21 November 2025.
However, older rules under the repealed laws still apply where they do not conflict with the Code. They remain valid until the government replaces them.
For motor transport undertakings, the Code identifies the state government as the appropriate government. The central rules of 8 May 2026 mainly cover central government establishments.
State implementations remain varied: while states such as Rajasthan and Andhra Pradesh have finalized their OSH rules, several others are still at the draft notification stage.
How do Penalties Work under the OSH Code?
The Code encourages compliance by providing guidance before imposing penalties. Inspector-cum-Facilitators serve an advisory role, with unit inspections selected via a randomized, web-based system.
- General penalty: Section 94 of the Code sets a fine of ₹2 lakh to ₹3 lakh. It applies where no specific penalty exists.
- Opportunity for Rectification: Before starting legal proceedings, the Inspector-cum-Facilitator gives employers 30 days to correct the non-compliance.
- Compounding: First-time offenses punishable only with a fine can be settled at 50% of the maximum fine.
What Challenges do Transport Employers Face Now?
During this transition, HR and compliance teams primarily face three operational challenges:
- Different state rules: Each state has its own rules, so an interstate fleet must deal with different forms and timelines.
- Undefined spread-over limits: The Code leaves spread-over limits to the appropriate government, and some states may not yet have prescribed a cap.
- Tracking duty hours: Hours include loading time and short terminal waits, which are difficult to record manually.
Employer Action Checklist for Motor Transport Undertakings
As an employer, you need to take these seven steps to comply with the Code:
- Re-evaluate Workforce Strength: Determine whether total headcount meets or exceeds the 10-worker threshold.
- Transition Registration: Submit existing registration details on the designated state portal.
- Issue Written Appointment Letters: Provide statutory appointment letters to all eligible existing staff within the prescribed three-month window.
- Align Leave Policies: Adjust accrual and encashment policies to reflect the 180-day eligibility threshold.
- Obtain Overtime Consent: Document explicit written consent prior to assigning overtime and calculate compensation at double the wage rate.
- Track Comprehensive Duty Hours: Log running time, loading/unloading activities, and brief terminal halts.
- Monitor State Notifications: Continuously track state-specific final OSH notifications for local variations.
Using an automated HR and payroll solution, you can capture duty hours through an attendance management system, apply leave rules, and calculate overtime pay accurately.
Conclusion
The Motor Transport Workers Act, 1961 is no longer a separate law, but its core protections for drivers and conductors continue under the OSH Code. The next phase depends on the states. As more states finalize their OSH rules, expect transparent limits on spread-over and rest intervals, along with state-specific registration forms. Transport employers that track duty hours digitally today will be better positioned to adjust their rosters when those limits take effect.
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FAQs
1. Is the Motor Transport Workers Act, 1961 Repealed?
Yes. Section 143 of the OSH Code, 2020 repeals the Motor Transport Workers Act, 1961. However, savings clauses preserve existing rules insofar as they do not conflict with the new Code. However, older rules made under the Act remain valid where they do not conflict with the Code.
2. Which Law Replaced the Motor Transport Workers Act, 1961?
The Occupational Safety, Health and Working Conditions Code, 2020 replaced it. The Code merges 13 older labour laws, including this one, into a single law.
3. Who is a Motor Transport Worker?
A motor transport worker works on a transport vehicle, whether hired directly or through an agency. Drivers, conductors, cleaners, station staff and booking clerks are some examples. Factory and shop employees are not included.
4. What are the Working Hours for Motor Transport Workers?
The Code sets a limit of 8 working hours a day for motor transport workers. These hours include running time, loading work, and short terminal waits. Your state decides the rest intervals and spread-over.
5. How is Overtime Paid to Motor Transport Workers?
Employers must pay overtime at twice the ordinary rate of wages and obtain the worker’s prior written consent. Overtime is calculated on a daily or weekly basis, whichever yields the worker more.
6. How Many Days Must a Worker Work to Earn Annual Leave?
Earlier, a worker needed 240 days of work in a calendar year. Now, 180 days are enough. Adults earn one day of leave for every 20 days worked. Adolescents earn one day for every 15 days worked.
7. Are Old Registrations under the Motor Transport Workers Act, 1961 Still Valid?
Yes. The Code treats units registered under an older central labour law as if they were registered under the Code. However, you must share your registration details within the timeframe set by your state.
8. Do Central or State Rules Apply to Transport Employers?
State rules apply. The Code makes the state government the appropriate government for motor transport undertakings. The central rules of 8 May 2026 mainly apply to central government establishments.
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