Labour Reforms in India
Industrial Relations Code Bill 2020:
- The number of employees needed to trigger the necessity for a standing order has been increased to above 300, which suggests that industrial firms with fewer than 300 employees won’t be expected to provide a standing order.
- The Industrial Employment (Standing Orders) Act of 1946 requires employers of industrial establishments with 100 or more employees to specify the terms of employment and standards of behaviour for workmen in standing orders or services rules and to communicate these terms to the workmen.
- Every industrial firm with 300 or more employees who are currently engaged or were employed on any day during the previous calendar year is subject to the new standing order requirement.
- The Standing Committee on Labour had previously proposed that the threshold be raised appropriately in the Code itself and that the phrase “as may be notified by the Appropriate Government” be removed because reforming labour laws through the executive branch is undesirable and should be avoided as much as possible.
- Orders won’t be subject to the whims and caprices of state government leaders after they become law.
- Due to the enhanced threshold, there will be more industrial establishments, which means standing orders won’t be necessary. As a result, employers will have more flexibility and time to hire and fire employees, which will lead to more jobs being created.
- It also adds new requirements for executing a valid strike. Instead of just the time for conciliation at the moment, the prerequisites for workers before going on a lawful strike now include the time period for arbitration proceedings.
- No employee of an industrial establishment may strike without giving 60 days’ notice, while a case is pending before a tribunal or a national industrial tribunal, or for 60 days following the conclusion of the case.
- The IR Code currently seeks to apply this rule to all industrial establishments. Currently, a person employed in a public utility service cannot go on strike unless they give notice for a strike within six weeks before going on strike or within fourteen days after giving such notice.
- Additionally, it has been suggested to establish a fund for reskilling laid-off workers with support from the company in the amount of the 15th day of their most recent paycheck.
Concerns:
- It will weaken the rights of workers in small businesses with less than 300 employees and give employers the power to impose arbitrary service standards on their workforce.
- It will offer employers a great deal of flexibility in terms of hiring and firing, and it will make it totally conceivable for all industrial firms with fewer than 300 workers to retrench for economic reasons and fire employees for alleged misconduct, which utterly destroys job security.
- The extended legal window before the employees can go on a legal strike is made nearly impossible by the new requirements for carrying out a legal strike.
- Even though the Standing Committee on Labour had advised against it beyond the public utility services like water, electricity, natural gas, telephone and other essential services, as is the case at the moment, it has been expanded to cover all industrial establishments for the necessary notice period and other conditions for a legal strike.
- The re-skilling fund’s mention of “other sources” of money is ambiguous. The reskilling fund’s structure is arbitrary because the Code is unsure of where the money for it will come from, aside from employer payments.
- These ambiguities are left to the bureaucrats and the rule-making procedures, and there are also questions about who will reskill the workforce and how sufficient the money will be.
Social Security Code Bill 2020:
- It suggests creating a National Social Security Board to advise the federal government on creating appropriate programmes for various categories of unorganised workers, gig workers, and platform workers.
- A further requirement for aggregators using gig workers is that they make social security contributions of 1% to 2% of their annual revenue, with a maximum contribution of 5% of the total amount paid by the aggregator to gig and platform workers.
Occupational Safety, Health, and Working Conditions Code Bill 2020:
- Inter-state migrant workers are those who move independently from one state to work in another, earning up to Rs. 18,000 a month, according to this definition.
- The suggested concept distinguishes between regular work and just contractual employment.
- The prior option for short-term housing for employees close to the workplaces has been removed, and a trip allowance—a one-time payment of transportation costs by the employer for an employee’s travel to and from their place of employment—has been proposed.
