Govt envisages broader social security net for workers

By: |
September 21, 2020 7:10 AM

The Bill enables the Centre to frame schemes to provide social security benefits to unorganised workers, gig workers, platform workers and self-employed workers or “any other class of persons”.

Of course, how exactly and when the benefits will be designed and whether it will suffice to provide meaningful social security cover to all workers will hinge on the specific schemes to be rolled out.

The government has proposed to extend, in a phased manner, social security benefits to all employees and workers, currently estimated to be around 50 crore, including those in the unorganised sector enterprises, under the revised Social Security Code introduced in Lok Sabha on Saturday.

The Bill enables the Centre to frame schemes to provide social security benefits to unorganised workers, gig workers, platform workers and self-employed workers or “any other class of persons”. It is not clear if workers in the agricultural and allied sectors could also be covered under such schemes.

Of course, how exactly and when the benefits will be designed and whether it will suffice to provide meaningful social security cover to all workers will hinge on the specific schemes to be rolled out.

The Bill defines unorganised worker as one who is a home-based worker, self-employed or a wage worker in the unorganised sector. An unorganised sector enterprise is the one which is owned by individuals or self-employed workers and engaged in the production or sale of goods or providing service of any kind whatsoever, and where the enterprise employs less than 10 workers.

The government, however, has neither prescribed any timeline to bring all workers under some sort of social security net nor has it given any concrete source of funds for providing social security benefits such as old age protection, life and disability cover, health and maternity benefits, provident fund, employment injury benefit, housing, educational schemes etc.

The Bill says the central government shall formulate and notify, from time to time, suitable welfare schemes for unorganised workers on matters relating to life and disability cover, health and maternity benefits, old age protection, education.

Also, states shall formulate and notify, from time to time, suitable welfare schemes for unorganised workers, including schemes relating to provident fund; employment injury benefit; housing; educational schemes for children; skill upgradation of workers; funeral assistance; and old age homes.

The funding options include assorted government resources as well as corporate funding via the CSR route.
The code provides for creation of a National Social Security Board which shall give recommendations to the central government for formulating suitable schemes for different sections of unorganised workers, gig workers and platform workers. State boards will do the same for the state governments.

In order to expand the traditional social security benefits, the government has proposed to allow establishments to be covered under employees’ provident fund organisation (EPFO) and Employees’ State Insurance Corporation (ESIC) on voluntary basis even if they have less than the mandatory employee threshold of 10 and 20 respectively.

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