What is New Labour Codes (India)?
Historical Background
Key Points
9 points- 1.
Consolidation: Replaced 29 central labour laws with 4 codes: Code on Wages, 2019; Industrial Relations Code, 2020; Code on Social Security, 2020; and Occupational Safety, Health and Working Conditions Code, 2020.
- 2.
Universal Minimum Wages: The Code on Wages, 2019 provides for a universal definition of 'wages' and aims to ensure a statutory minimum wage for all workers, including those in the unorganised sector, along with timely payment.
- 3.
Industrial Relations: The Industrial Relations Code, 2020 introduces provisions for worker re-skilling fund, expands the threshold for requiring government permission for layoffs/retrenchment to 300 workers (from 100), and mandates a prior notice for strikes/lockouts.
- 4.
Expanded Social Security: The Code on Social Security, 2020 aims to extend social security benefits like provident fund, ESI, gratuity, and maternity benefits to a wider segment of the workforce, including gig and platform workers and unorganised sector workers.
- 5.
Occupational Safety: The Occupational Safety, Health and Working Conditions Code, 2020 consolidates laws relating to safety, health, and working conditions, covering aspects like working hours, annual leave, and women's employment.
- 6.
Ease of Doing Business: Simplifies compliance by reducing the number of laws, harmonizing definitions, and introducing single licensing and registration mechanisms.
- 7.
Formalization of Labour: Aims to bring more workers into the formal economy by expanding coverage of social security and minimum wages, thereby reducing informality.
- 8.
Flexibility for Employers: Provides greater flexibility in hiring and firing, particularly for smaller establishments, while also establishing a re-skilling fund for retrenched workers.
- 9.
Dispute Resolution: Streamlines the process for industrial dispute resolution and encourages voluntary arbitration.
Visual Insights
New Labour Codes: Structure, Objectives & Impact
This mind map illustrates the four new Labour Codes, their individual focus areas, and their collective objectives, highlighting their relevance to governance, economy, and social justice.
New Labour Codes (India)
- ●Code on Wages, 2019
- ●Industrial Relations Code, 2020
- ●Code on Social Security, 2020
- ●OSH & Working Conditions Code, 2020
- ●Overall Objective: Ease of Doing Business
- ●Overall Objective: Ease of Living (for Workers)
Recent Developments
4 developmentsAll 4 labour codes were passed by Parliament between 2019 and 2020.
The codes are yet to be implemented as states need to frame their respective rules, and the central government is awaiting consensus.
Debates continue regarding the potential impact on workers' rights, particularly concerning the increased threshold for retrenchment and the definition of 'employee' for gig workers.
Government emphasizes the codes will improve 'ease of living' for workers and 'ease of doing business' for employers.