Rajya Sabha passes three labour code bills despite continued protests

Rajya Sabha passes three labour code bills despite continued protests
Picture Courtesy: zeenews.india.com

Gangtok, September 25: The Rajya Sabha on September 23 passed three out of the four labour bills which comprised the Government’s flagships labour reforms which were announced in the Upper House of the Parliament while the opposition continued to boycott the proceedings and protested outside the Parliament over the suspension of eight members of the opposition after the commotion in the Rajya Sabha over the alleged rushing through the farm bills by the government. 

The three labour code bills are - Code on Occupational Safety, Health and Working Conditions, Industrial Relations Code and Social Security Code, which were passed in the Upper House of the parliament by voice vote on September 23, while the Lok Sabha had passed the bills on September 22. With the passing of the three labour code bills, employers will now have greater flexibility to fire and hire employees while also ensuring social security for workers.

There has been a lot of debate in the country regarding the above-mentioned bills to which the Labour Minister of Government of India, Santosh Gangwar has said, “The purpose of labour reforms is to provide a transparent system to suit the changing business environment,” adding that almost 16 states have ‘already increased the threshold for closure, lay off and retrenchment in the firms with up to 300 workers without government permits and that states have been given flexibility in tweaking the labour laws as per their need. 

Gangwar has also said that while it is not good for employment generation to continue keeping the threshold law at 100 because it would discourage employers to recruit more employees than 100 and would deliberately keep the strength of the workers below it. “Investors will be encouraged to set up big factories and employ more and more workers,”  Gangwar explained, further that the bills would safeguard the interest of the workers and would provide the workers universal social security by the expansion of the ambit of the Employees' Provident Fund Organisation and Employees' State Corporation of India.

The three labour code bills can be detailed as the following 

  1. In the Industrial Relations Code Bill, 2020, the government has proposed for:
  • New conditions for the legal strike – no person employed in any industrial establishment shall go on strike without a 60-day notice and during the pendency of proceedings before a Tribunal and sixty days after the conclusion of such proceedings. Earlier such restrictions applied only to public utility services.
  • Raised the threshold for the requirement of a standing order — rules of conduct for workmen employed in industrial establishments — from the existing 100 to 300 workers.
  • Reskilling Fund – To set up a re-skilling fund for the training of retrenched workers with the contribution of the employer of an amount equal to 15 days last drawn by the workers.

       2. The Social Security Code has the following provisions:

  • National Social Security Board which shall recommend to the central government for formulating suitable schemes for different sections of unorganised workers, gig workers and platform workers.
  • No more ambiguities: The bill has defined various terms like “career centre”, “aggregator”, “gig worker”, “platform worker”, “wage ceiling”, etc.
  • Social security for gig workers: Also, aggregators employing gig workers will have to contribute 1-2 per cent of their annual turnover for social security of workers.

       3. The Occupational Safety, Health and Working Conditions Code has the following objectives:

  • To employ women in all establishments for all types of work. They can also work at night, that is, beyond 7 PM and before 6 AM subject to the conditions relating to safety, holiday, working hours and their consent.
  • To Promote Formalisation: Issuing of appointment letter mandatorily by the employer of an establishment to promote formalisation in employment.
  • Inclusion of inter-state migrant workers in the definition of worker: Inter-state migrant workers are defined as the worker who has come on his own from one state and obtained employment in another state, earning up to Rs 18,000 a month.
  • The proposed definition makes a distinction from the present definition of only contractual employment.
  • Portability Benefits: An Inter-State Migrant Worker has been provided with the portability to avail benefits in the destination State in respect of ration and availing benefits of building and other construction worker cess.
  • However, the Code has dropped the earlier provision for temporary accommodation for workers near worksites.
  • It has though proposed a journey allowance — a lump sum amount of fare to be paid by the employer for to and fro journey of the worker to his/her native place from the place of his/her employment.

While there has been concern raised over the three new labour bills such as the dilution of the rights of workers, as workers in small establishments will have their rights watered down with no protection of trade unions and labour laws and could enable the companies to introduce arbitrary service conditions for workers, while also providing companies with more flexibility to employers for hiring and firing workers without government permission. The ambiguity about the reskilling Fund has also been addressed as the Code lacks clarity on the substantive and procedural aspects of reskilling Fund which might fizzle out like the National Renewal Fund in the 1990s.

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