LABOUR LAW REFORMS: CA Divya Mandhan, Sunil Arora & Associates, Chartered Accountants.

 LABOUR LAW REFORMS:

The Government has introduced three crucial labour legislations:

1. The Code on Occupational Safety, Health and working conditions
2. The Industrial Relations Code
3. The Social Security Code

1. THE CODE ON OCCUPATIONAL SAFETY, HEALTH AND WORKING CONDITIONS:

a.   INTRODUCTION

The Code proposes to subsume 13 major labour laws into one single Code. The laws to be subsumed are:

• The Factories Act, 1948

• The Contract Labour (Regulation and Abolition) Act, 1970

• The Mines Act, 1952

• The Dock Workers (Safety, Health and Welfare) Act, 1986

• The Building & Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996

• The Plantations Labour Act, 1951

• The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979

• The Working Journalist and other News Paper Employees (Conditions of Service and Miscellaneous Provision) Act, 1955

• The Working Journalist (Fixation of rates of wages) Act, 1958

• The Cine Workers and Cinema Theatre Workers Act, 1981

• The Motor Transport Workers Act, 1961

• The Sales Promotion Employees (Conditions of Service) Act, 1976

• The Beedi and Cigar Workers (Conditions of Employment) Act, 1966

b.  LICENSE AND REGISTRATION:

Establishments covered by the Code are required to register within 60 days (of the commencement of the Code) electronically to the registering officers appointed by the Central or State government.

c.   KEY CHANGES

• The code makes it mandatory for the employer to appoint welfare officer if 250 workers employed, earlier being 500.

• The code makes it mandatory for the organization appointing the workers to provide the same a letter of the appointment stating relevant details.

• The code provides for the migrant workers to get basic facilities including fare for to and fro from his native place to work place which are the responsibility establishment including benefits under the Employees’ State Insurance Act, 1948 or the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 or any other law for the time being in force.

• Worker or employee to be provided with the overtime wage which should be double of the wage entitled to receive.

• The code lays down a responsibility on the employer to provide facilities such as ventilation, potable drinking water, proper lighting, crèche for female workers having child of 6 years of age.(the number has increase from 30 to 50), proper clean washrooms. The workmen engaged in plant to be provided with proper residential facility. Canteen also to be provided if minimum 100 workers working (the limit has been reduce to 100 from 250). Female workers can work beyond 7pm till 6am if provided with proper and safe conditions.

• The workplace should be free from hazards that can cause or may cause any health hazards to the workers in the premises and hazardous to be disposed in a responsible manner. Impaired workers cannot be appointed in the construction industry.

• The code lays down the provision for compulsory annual health check-up camps to be organised by the employer.

• Workers cannot be required to work for more than 6 days / week and will be entitled to one day off for every 20 days of work & one day off every week.

• The Code has made maximum registration process to be initiated electronically.

• Various penalties have been enhanced for the violations under this Code.

2. THE INDUSTRIAL RELATIONS CODE

This code proposes to subsume 3 major labour laws into One single code. The laws to be subsumed are:

• Trade Unions Act, 1926
• Industrial Employment (Standing Orders) Act, 1946
• Industrial Disputes Act, 1947

KEY CHANGES

The Code defines “workers” which includes the persons in supervisory capacity getting wages up to eighteen thousand rupees per month or an amount as may be notified by the Central Government from time to time.

• The Code defines “workers” which includes the persons in supervisory capacity getting wages up to eighteen thousand rupees per month or an amount as may be notified by the Central Government from time to time.

• The Code imposes a blanket prohibition on strikes and lock-outs in all industrial establishments without notice and thus no unit can go on strike in breach of contract without giving notice 60 days before the strike or within 14 days of giving such a notice, or before the expiry of any date given in the notice for the strike. Strikes are also prohibited during the pendency of conciliation proceedings as well as within 7 days of the conclusion of such proceedings. Similarly, strikes during the pendency of proceedings before an industrial tribunal or 60 days after their conclusion are prohibited. The Industrial Disputes Act, 1947 contained similar provisions, however they were applicable only to public utility services.

• To provide for fixed term employment with the objective that the employee gets all the benefits like that of a permanent worker (including gratuity), except for notice period after conclusion of a fixed period, and retrenchment compensation. The employer has been provided with the flexibility to employ workers on fixed term basis on the basis of requirement and without restriction on any sector.

• There is also a provision made for the establishment for the constitution of a negotiating council where there is no single union that meets the 51% threshold as mentioned above. In such cases, the council is constituted of representatives from the various unions provided they have at least 20% of employees as its members

• Section-77 under Chapter-X applies to industrial establishments in which not less than 300 workers or such higher number of workers as may be specified by the appropriate Government, were employed on average per working day in the preceding 12 months. Thus, establishments falling under this provision are required to obtain prior permission of the Government for lay-off, retrenchment and closure.

3. THE SOCIAL SECURITY CODE

This code subsumes 9 major labour laws relating to social security, retirement and employee benefits into one single code. The laws to be subsumed are:

• The Employees Compensation Act, 1923

• The Employees State Insurance Act, 1948

• The Employees Provident Fund and Misc. provisions Act, 1952

• The Employees Exchange Act, 1959

• The Maternity Benefit Act, 1961

• The Payment of Gratuity Act, 1972

• The Cine Workers Welfare Fund Act, 1981

• The Building and Other construction workers cess Act, 1996

• The Unorganized Workers Social Security Act, 2008

KEY CHANGES:

• Broad based applicability – coverage for gig, platform and unorganized workers. Schemes for gig, platform and unorganized workers to be framed for providing eligible benefits.

• The Code also aims to protect the benefit of employees in the event of insolvency of the employer. The code provides that if there are any dues from an employer in connection with the benefits covered under the social security code i.e. Provident fund, ESI, Gratuity, Maternity Benefits, etc. then such dues shall be paid on priority in accordance with section 53 of the Insolvency and Bankruptcy Code, 2016.

• Widening of Wage definition in the Code. Under the existing Payment of Gratuity Act, wages include basic salary and dearness allowance and exclude any other allowance. However, under the social security code, the definition of wage is quite wide with a list of inclusions and exclusions.

• Individuals on fixed term employment included for gratuity on pro-rata basis irrespective of period of service.

• Significant increase in penalties and prosecution – No compounding for repeat offences