New Delhi: The government, on Friday, implemented Four labour codes with an aim towards modernising India’s labour governance. They are Code on Wages (2019), Industrial Relations Code (2020), Code on Social Security (2020), and Occupational Safety, Health and Working Conditions (OSHWC) Code (2020). The 29 existing central labour laws have been repealed.
This comes more than five years after the Parliament had cleared the labour codes in 2020.
Union labour minister Mansukh Mandaviya posted on X that: “From today, the new labour codes have been implemented in the country.”
“They will ensure a guarantee of timely minimum wages for all workers, appointment letters for the youth, equal pay and respect for women, gratuity for fixed-term employees after one year of employment, free annual health check-ups for workers above 40 years of age, double wages for overtime, 100% health security for workers in hazardous sectors, and social justice for workers as per international standards,” he said.
The Acts have been notified and the rules will be issued in 5-7 days, after which they will be enforced immediately, an official said.
“Rules will keep coming. But all the sections that do not require rules will be implemented immediately,” he said.
Both the Centre and states have to frame laws and rules as labour is a concurrent subject. The majority of the states have already carried out labour laws-related changes over the last few years, except West Bengal, the government official said.
The Ministry of Labour said the government will engage with the public and stakeholders in the framing of the corresponding rules, regulations, schemes under the Codes, in line with the wide-ranging consultations carried out during the drafting of the Labour Codes.
“During transition, the relevant provisions of the existing labour Acts and their respective rules, regulations, notifications, standards, schemes, etc. will continue to remain in force,” the ministry said.
The four labour codes have wide-ranging social security provisions, such as floor wage and a requirement for employers to contribute for social security. They have come under some criticism from trade unions though regarding the unclear provision on retrenchment and possible discretionary behaviour during implementation by the central or state governments.
The Code on Wages, as per the version passed in the parliament, proposes to fix a National Floor Level Minimum Wage, and redefine the break-up of wages to increase the share of the basic pay component — a provision to enable higher provision for social security for establishments, especially in the service sector
Similarly, according to The Code on Social Security, aggregators employing gig workers have to contribute 1-2 per cent of annual turnover for social security, with the total contribution not exceeding 5 per cent of the amount payable by the aggregator.
