Ministerial panel to meet next week to finalise wage, IR codes

2 Bills will be put up for Cabinet approval before introducing the same in Parliament for passage

The ministerial panel on labour issues headed by Finance Minister Arun Jaitley will meet next week to finalise drafts of the new industrial relations code and the wage code.

The ministerial panel broadly agrees on the wage code while more deliberations will be held on the industrial relations code.

After ministerial panel's approval, the two Bills will be put up for Cabinet approval before introducing the same in Parliament for passage.

"Next meeting of the panel will be held next week," Labour Minister Bandaru Dattatreya told reporters on the sidelines of a conference 'Vision Zero' on occupational safety and health.

The minister further said, "In the inter-ministerial meeting, we have cleared the wage code. There was a first phase of discussion on the industrial relations code. The Code on Wages... Everybody has agreed. We proceed (on the wage code)."

The minister also indicated the government's intent to push amendments in the Payment of Gratuity Act to enhance the ceiling of tax-free gratuity to Rs 20 lakh from the existing Rs 10 lakh in the ongoing session of Parliament.

"We have cleared the amendments in the Payment of Gratuity Act in the tripartite meeting and also we have taken it up to the Cabinet. After clearance from the Cabinet, it will come to Parliament. This time, we have proposed to increase the (tax free ceiling of) gratuity from Rs 10 lakh to Rs 20 lakh," the minister said.

Earlier last week, the ministerial panel headed by the finance minister had deliberated on the suggestions for the two codes at a meeting. It was attended by Labour Minister Bandaru Dattatreya and Power Minister Piyush Goyal.

Asked whether there will be more discussions on the two codes, the labour minister had said there could be another on the two bills later this month. He had also dropped hints that the two Bills will be pushed for passage in Parliament during the second leg of the Budget Session, which began on March 9.

The two legislations are significant as they form part of the efforts of the government to improve ease of doing business.

The labour ministry has plans to condense nearly 44 labour laws into four codes — wages, industrial relations, social security and safety, health and working conditions.

Trade unions are opposed to certain amendments in these codes and have already submitted their dissent note.

The new industrial relations code proposes to raise the ceiling on number of workers for units that can go for closure, retrenchment or layoff without government approval to 300 from 100.

At present, all units with up to 100 workers are not required to seek government nod for closure, retrenchment or layoff.

The government has completed tripartite discussions on these two codes to seek view of stakeholders, including the industry, unions and states.

The proposed code on wages will subsume the Minimum Wages Act of 1948, the Payment of Wages Act of 1936, the Payment of Bonus Act of 1965 and the Equal Remuneration Act of 1976.

Similarly, the code on industrial relations will subsume Industrial Disputes Act, 1947, the Trade Unions Act, 1926, and the Industrial Employment (Standing Orders) Act, 1946.