Opposition Calls for Scrapping New Labour Codes, Citing Worker Concerns

Opposition parties demand the repeal of four new labour codes, arguing they are anti-worker and pro-corporate.

Photo by Dibakar Roy

Opposition parties, including the Congress and Left, are strongly demanding the repeal of the four new labour codes, calling them "anti-worker" and "pro-corporate." They argue that these codes undermine workers' rights, dilute social security, and make it easier for companies to hire and fire. The government, however, maintains that the codes aim to simplify India's complex labour laws, promote ease of doing business, and protect workers' interests by expanding social security coverage. This debate highlights the ongoing tension between economic reforms and labour welfare in India.

Key Facts

Four new labour codes are at the center of the debate.

Opposition alleges codes are "anti-worker" and "pro-corporate."

Government claims codes simplify laws, promote ease of doing business, and expand social security.

UPSC Exam Angles

Constitutional provisions related to labour (Concurrent List, DPSP Articles 39, 41, 42, 43, 43A)

Impact on organized vs. unorganized sector and gig workers

Ease of Doing Business vs. Labour Welfare: A policy dilemma

Role of International Labour Organization (ILO) and India's commitments

Federalism and Centre-State relations in labour policy

Economic reforms and their socio-economic implications

Visual Insights

New Labour Codes: Opposition vs. Government Stance

This table highlights the core arguments put forth by the opposition and the government regarding the four new labour codes, illustrating the central tension in the debate.

Aspect	Opposition's Argument	Government's Argument
Nature of Codes	Anti-worker, Pro-corporate	Simplify complex laws, Modernize labour market
Workers' Rights	Undermine existing rights, Dilute protections	Protect workers' interests, Expand social security
Social Security	Dilute social security benefits for many	Universalize social security, Include gig/platform workers
Hiring & Firing	Make it easier for companies to hire and fire (e.g., increased retrenchment threshold)	Promote ease of doing business, Provide flexibility to employers
Economic Impact	Lead to precarious employment, Increase worker exploitation	Boost employment, Formalize economy, Attract investment

Key Milestones in India's Labour Law Reforms

This timeline illustrates the historical context and progression of labour law reforms in India, leading up to the introduction and current status of the new labour codes.

India's labour laws, historically complex and fragmented, needed modernization. The idea of codification gained momentum to promote ease of doing business and expand social security, leading to the 2020 codes, which are currently awaiting full implementation amidst significant debate.

2002Second National Commission on Labour recommends rationalization of labour laws.
2014-2019NDA government initiates process of labour law codification to simplify existing laws.
2019Code on Wages, 2019, passed by Parliament.
2020Industrial Relations Code, Code on Social Security, and Occupational Safety, Health and Working Conditions Code passed by Parliament.
2020-PresentNew Labour Codes passed but not yet implemented due to pending finalization of rules by central and state governments. Ongoing consultations and opposition.

More Information

Background

India's labour laws have historically been complex, fragmented, and often criticized for being rigid, hindering industrial growth and formal employment. Post-independence, numerous laws were enacted to protect workers, often leading to a labyrinthine system.

The Second National Commission on Labour (2002) recommended rationalization and consolidation of these laws. The government's recent move to consolidate 29 central labour laws into four codes is a significant step in this direction, aiming to modernize the regulatory framework.

Latest Developments

The government consolidated 29 central labour laws into four broad codes: The Code on Wages, 2019; The Industrial Relations Code, 2020; The Code on Social Security, 2020; and The Occupational Safety, Health and Working Conditions Code, 2020. These codes are yet to be implemented nationwide due to lack of consensus and state-level preparations.

Opposition parties and trade unions are strongly demanding their repeal, citing concerns about dilution of workers' rights, ease of 'hire and fire', and reduced social security. The government, however, maintains that the codes aim to simplify laws, promote ease of doing business, and expand social security coverage to more workers.

Practice Questions (MCQs)

1. With reference to the new Labour Codes in India, consider the following statements: 1. The four new labour codes consolidate 29 central labour laws, aiming to simplify the regulatory framework. 2. The Code on Wages, 2019, subsumes the Minimum Wages Act, 1948, and the Payment of Wages Act, 1936. 3. The Industrial Relations Code, 2020, significantly raises the threshold for requiring government permission for retrenchment or closure from 100 to 300 workers. Which of the statements given above is/are correct?

A.1 and 2 only
B.2 and 3 only
C.1 and 3 only
D.1, 2 and 3

Show Answer

Answer: D

Statement 1 is correct. The government has indeed consolidated 29 central labour laws into four codes. Statement 2 is correct. The Code on Wages, 2019, consolidates and amends laws relating to wages and bonus, subsuming four existing laws: the Minimum Wages Act, 1948; the Payment of Wages Act, 1936; the Payment of Bonus Act, 1965; and the Equal Remuneration Act, 1976. Statement 3 is correct. A key provision of the Industrial Relations Code, 2020, is the increase in the threshold for requiring government permission for retrenchment, layoff, or closure from establishments employing 100 workers to 300 workers, which has been a major point of contention for trade unions.

2. In the context of labour welfare and economic reforms in India, which of the following statements is/are correct regarding the constitutional provisions? 1. 'Labour' is a subject included in the Concurrent List of the Seventh Schedule to the Constitution of India. 2. Article 43A of the Constitution mandates the State to secure for all workers a living wage and conditions of work ensuring a decent standard of life. 3. The Directive Principles of State Policy (DPSP) include provisions for securing the health and strength of workers and protecting children against exploitation. Select the correct answer using the code given below:

A.1 only
B.1 and 3 only
C.2 and 3 only
D.1, 2 and 3

Show Answer

Answer: B

Statement 1 is correct. 'Labour' is indeed a subject in the Concurrent List, allowing both the Union and State governments to legislate on it. Statement 2 is incorrect. Article 43 of the DPSP mandates the State to secure for all workers a living wage and conditions of work ensuring a decent standard of life. Article 43A, inserted by the 42nd Amendment, mandates the State to take steps to secure the participation of workers in the management of industries. Statement 3 is correct. Article 39(e) directs the State to ensure that the health and strength of workers, men and women, and the tender age of children are not abused, and that citizens are not forced by economic necessity to enter avocations unsuited to their age or strength. Article 39(f) directs the State to provide opportunities for healthy development of children and youth against exploitation.

3. Consider the following statements regarding the 'social security' framework in India: 1. The Code on Social Security, 2020, aims to universalize social security coverage for all workers, including those in the unorganized sector and gig workers. 2. The Employees' Provident Funds and Miscellaneous Provisions Act, 1952, is one of the key legislations subsumed under the new Code on Social Security. 3. The International Labour Organization (ILO) Convention No. 102 concerning Minimum Standards of Social Security has been ratified by India. Which of the statements given above is/are correct?

A.1 and 2 only
B.2 and 3 only
C.1 and 3 only
D.1, 2 and 3

Show Answer

Answer: A

Statement 1 is correct. A stated objective of the Code on Social Security, 2020, is to expand social security coverage to a wider range of workers, including those in the unorganized sector, platform workers, and gig workers, who were previously largely excluded. Statement 2 is correct. The Code on Social Security, 2020, subsumes nine existing social security laws, including the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, and the Employees' State Insurance Act, 1948. Statement 3 is incorrect. India has not ratified ILO Convention No. 102 concerning Minimum Standards of Social Security. India has ratified several other ILO conventions, but not this comprehensive one.