What is Code on Social Security, 2020?
Historical Background
Key Points
9 points- 1.
Consolidation: Replaces nine central laws related to social security, aiming for simplification and broader coverage.
- 2.
Universalization: Seeks to provide social security coverage to all workers, including those in the unorganized sector, gig workers, and platform workers.
- 3.
Gig and Platform Workers: For the first time, explicitly defines gig workerspersons who perform work or participate in a work arrangement and earn from such activities outside of a traditional employer-employee relationship and platform workerspersons engaged in a work arrangement where organizations or individuals use an online platform to access other organizations or individuals to solve specific problems or to provide specific services or any such other activities and mandates social security schemes for them.
- 4.
Aggregator Contribution: Mandates aggregatorsdigital intermediaries like Swiggy, Zomato, Ola, Uber to contribute a certain percentage (to be prescribed by the government, e.g., 1-2%) of their annual turnover towards a social security fund for gig and platform workers.
- 5.
National Social Security Board: Establishes a National Social Security Board for unorganized workers, gig workers, and platform workers to recommend and monitor schemes.
- 6.
Benefits Covered: Encompasses various benefits such as provident fund, gratuity, employee state insurance (ESI), maternity benefit, and other welfare schemes.
- 7.
Portability: Aims to ensure portability of social security benefits for migrant workers.
- 8.
Central Fund: Proposes the establishment of a Social Security Fund for unorganized workers, gig workers, and platform workers, funded by contributions from the Central Government, State Governments, and aggregators.
- 9.
Registration: Mandates registration of all unorganized workers, gig workers, and platform workers to facilitate access to benefits.
Visual Insights
Code on Social Security, 2020: A Comprehensive Overview
Illustrates the key features, objectives, and scope of the Code on Social Security, 2020, highlighting its significance for UPSC preparation.
Code on Social Security, 2020
- ●Objectives
- ●Key Provisions
- ●Beneficiaries
- ●Legal Basis & Context
Social Security Framework: Old Laws vs. Code on Social Security, 2020
Compares the previous fragmented social security laws with the consolidated Code on Social Security, 2020, highlighting the reform's impact.
| Feature | Pre-2020 Fragmented Laws | Code on Social Security, 2020 |
|---|---|---|
| Coverage | Primarily organized sector; limited/ad-hoc for unorganized. | Universalization goal; explicit inclusion of unorganized, gig, and platform workers. |
| Number of Laws | 9 central laws (e.g., EPF Act, ESI Act, Maternity Benefit Act) | Consolidated into a single Code. |
| Gig/Platform Workers | No explicit recognition or coverage. | Explicitly defined and mandated social security schemes for them. |
| Aggregator Role | Not applicable. | Mandates aggregators to contribute a percentage to a social security fund. |
| Administration | Multiple boards/agencies for different laws. | Establishes a National Social Security Board for unorganized, gig, and platform workers. |
| Benefits | Fragmented benefits under separate laws. | Consolidated benefits including PF, ESI, Gratuity, Maternity, etc., under one framework. |
| Portability | Limited, especially for migrant workers. | Aims to ensure portability of benefits. |
| Funding | Employee/employer contributions, government for specific schemes. | Similar, with additional aggregator contributions for gig/platform workers. |
Recent Developments
4 developmentsThe Code was passed in 2020 but its implementation has been pending as rules are yet to be finalized by the Central and State governments.
Ongoing consultations with stakeholders, including trade unions and industry bodies, regarding the implementation framework and contribution rates.
Debates continue on the definition of 'employee' vs. 'worker' and the financial implications for aggregators.
State governments are in the process of framing their respective rules for the Code's enforcement.