With the federal government setting the stage for the 4 new labour codes, there are indications of a staggered implementation with an preliminary rollout of two codes, The Code on Wages and The Code on Social Security. These will probably be adopted by the opposite two — The Industrial Relations Code and The Occupational Safety, Health and Working Conditions Code — at a later stage.
The proposed phased implementation of the codes, together with social safety measures for casual employees, will probably be a part of the discussions on the National Labour Conference of labour ministers and secretaries of all states/UTs and the Centre to be held on August 25-26 at Tirupati.
Senior authorities officers indicated there’s an rising consensus in favour of a staggered implementation, with most states having pre-published the draft guidelines for The Code on Wages. “Many discussions have happened with all stakeholders. Concerns were raised about the wage provision, whether allowances can be more than 50 per cent. Those have been sorted out and we are trying to build consensus on other issues. Most states have pre-published draft rules for Wage Code, and for rest also they are doing it. A phased implementation is being considered and discussed,” a senior authorities official advised The Indian Express.
A consensus has emerged on numerous points, equivalent to the availability for allowances being capped at 50 per cent of the overall wage, for which the business had earlier sought a assessment. Industry representatives, together with CII, of their current assembly with Labour & Employment Ministry officers gave their consent for the wage provision and made representations for grandfathering gratuity calculations.
DefinedThe first two codes
With 31 states and UTs having ready the draft guidelines for The Code on Wages, will probably be among the many first two codes to be launched by the Centre. The different, The Code on Social Security, is geared toward offering a safety web for casual employees.
CII in its illustration really helpful readability on calculation of wages, particularly defining the essential part. It has additionally sought that gratuity calculation ought to be potential with the brand new legislation. “Grandfather the retrospective period as it impacts all companies books of account,” it mentioned.
Earlier, the business had sought a assessment for the availability for primary pay and allowances. The labour codes suggest to outline wages with primary pay to be at the least 50 per cent of whole wage, which successfully reduces take-home salaries however raises contributions in the direction of social safety elements equivalent to Employees’ Provident Fund. “The sense was that if the industry asks for a change in the law for tweaking this wage provision, then there could be similar demands for such amendments from other stakeholders. So, we have instead asked for grandfathering of the gratuity, it should be as per old calculations for earlier deductions and that changes should be prospectively applied,” an business consultant mentioned.
The National Labour Conference, which may have a digital deal with by the Prime Minister, will talk about a spread of points on the rollout of the labour codes together with discussions on migrant employees’ knowledge and Vision-2047 for workforce.
Experts mentioned a phased implementation of the codes will give the Centre an edge forward of the final elections. “It will not be one-go because none of the state governments have notified the rules, all of them have it in draft form. All are waiting and watching … before the elections, the government may like the Wage Code and Social Security Code to be implemented because gig employees are taken care of, universal social security would be there, minimum wage would be there. Electorates are not worried about hire-and-fire, trade unions are worried about that. So for election purposes, it is imperative to pass Wage Code and Social Security Code instantly,” labour economist and professor at XLRI — Xavier School of Management Jamshedpur, Ok R Shyam Sundar mentioned.
Strategically, he mentioned, it’s higher to carry Wage Code and Social Security Code first, and people on OSH and IR later. “It is a strategic move for the government to hard pedal the industry to introduce Wage Code, thereby earn legitimacy and also satisfy the credibility gap and also introduce social security to be inclusive about gig workers, and then through the backdoor introduce the IR code and the OSH code.”
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With labour being a concurrent topic, the Centre and states have to border legal guidelines and guidelines. While Parliament cleared the labour codes in 2020, and the Centre pre-published the draft guidelines, some state governments are but to finish the method. Thirty-one states and Union Territories (UTs) have pre-published the draft guidelines for the Code on Wages, whereas 26 have executed for the Industrial Relations Code. 25 states have pre-published draft guidelines for the Code on Social Security and 24 have executed for the Occupational Safety, Health and Working Conditions Code.
Some of the important thing options of the proposed labour codes embrace bringing in a nationwide minimal wage, widening of protection of social safety to cowl casual and gig/ platform employees, offering larger flexibility to employers in hiring selections with out authorities permission by elevating the brink for requirement of a standing order – guidelines of conduct for workmen employed in industrial institutions – from 100 employees to 300 employees.
