Monsoon session: Three labour codes tabled, clutch of reforms proposed

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September 20, 2020 7:15 AM

The Code on Wages Bill, 2019, which proposes universalisation of minimum wages, was passed by Parliament last year.

The new IR Code also seeks encourage resolution of disputes through tripartite negotiations. (Representative image)The new IR Code also seeks encourage resolution of disputes through tripartite negotiations. (Representative image)

The Narendra Modi government on Saturday tabled for ‘discussion and passage’ three labour codes in Parliament, including the Industrial Relations (IR) Code 2020, which contains a clutch of industry-friendly proposals.

The key proposals in the IR Code that will ease labour law rigidities are the following: a much larger segment of firms – as the Bill becomes law, those with workers up to 300 as against 100 now – will be able to resort to closure and retrenchment without prior government permission (the state governments are to be authorised to allow this via notification), endorsement by law of the already-in-force full-benefit fixed-term employment scheme that gels with the business pattern of industries that witness seasonal spurt in activities; requirement of mandatory 14-day notice for strikes and lock-outs will now apply to all units, not just public utility firms; proliferation of trade unions to be curbed, as only those unions with support of at least 50% of the workers on the muster roll of the unit concerned will have the right to labour terms with the management.

Apart from the IR Code, labour minister Santosh Kumar Gangwar also introduced the Occupational Safety, Health And Working Conditions Code, 2020 and the Code On Social Security, 2020.

All the three codes have been vetted by the Parliamentary standing committee. He withdrew the three bills that were introduced last year and introduced the three new ones, including a number of suggestions made by the standing committee.

The Code on Wages Bill, 2019, which proposes universalisation of minimum wages, was passed by Parliament last year. The Modi government had announced its plan to amalgamate 44 central labour Acts into four codes in 2014, with the aim of simplifying the laws and ensuring a conducive and harmonious environment for doing business.

The new IR Code also seeks encourage resolution of disputes through tripartite negotiations. Definition of ‘strike’ is also being amended to include ‘mass casual leave’ within its ambit. Concerted casual leave on a given day by 50% or more workers will be treated as strike. However, a proposal in the original version of the Code to bar outsiders from becoming office bearers of trade unions has been omitted in the revised draft.

Already, nine states namely Andhra Pradesh, Assam, Haryana, Jharkhand, Madhya Pradesh, Rajasthan, Uttarakhand, Uttar Pradesh and Gujarat have raised the limit for units with right to resort to closure and lay-offs through state laws; the IR Code would protect such amendments.

Introducing the three Bills in Lok Sabha, Gangwar said of the 233 recommendations suggested by the standing committee, chaired by BJD MP Bhartruhari Mahtab, 174 have been incorporated in the amended versions of the bills. “These codes will also bring the industrial peace and harmony in the country which will immensely help the country in bringing much needed economic growth and will help in employment generation. They will also help promote investment and will create harmonious industrial relations in the country,” he said.

Under the Code on Social Security, the labour ministry had earlier proposed to universalise social security for all sets of workers; but the Bill it introduced in Lok Sabha proposes to form a National Social Security Board that would recommend suitable schemes for the different section of unorganised sector workers.

Initially, the government had planned to delegate the functions of Employees’ Provident Fund Organisation and Employees’ State Insurance Corporation to the state governments, but this proposal has been done away with, in the Bill. So, both the social security organisations would be kept in the central sphere.

The Bill also proposes to empower the centre to constitute a social security fund for provision of social security for the unorgansied workers, platform workers or gig workers or any such class of workers.

The Code on Occupation Safety proposes to allow the women employees to work at night, subject to the conditions relating to safety, holiday, working hours and their consent.

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