LS clears three crucial codes for workers' welfare subsuming 29 labour laws

The Lok Sabha on Tuesday passed three crucial labour codes, which the minister of state for labour and employment said, will prove to be a "game changer" for welfare reforms for more than 500 million organised and unorganised workers.

The three Bills -- Industrial Relations Code, Code on occupational Safety, Health and Working Conditions and Social Security Code -- besides the one on Wage Code already passed by the Lok Sabha, subsumed 29 labour laws.

The codes envisage setting up of a social security fund for 400 million unorganised workers along with the GIG and platform workers. The Code on Social Security Bill, however, puts a cap on the total contributions companies have to make. The contribution “should not be more than 5 per cent of the amount paid to gig workers” and “the annual turnover of an aggregator shall not include any tax, levy and cess paid or payable to the Central Government” for the purpose of the calculation

The Code on Occupational Safety, Health (OSH) and Working Conditions Bill, 2020, facilitates hiring contract workers across the board for companies, even though it has introduced the concept of core and non-core activities in the functioning of a unit. It also seeks to bring more companies out of the purview of the contract labour law by increasing the threshold of its applicability, based on the size of firms.

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However, the employment of contract labour in core activities of any establishment is prohibited. For instance, Maruti Suzuki will not be able to hire contract workers for production of cars, which will be seen as its core activity, but will be allowed to do so for managing its canteen, housekeeping roles or security services.

The Code on Industrial Relations has a provision allowing industries to hire workers on a fixed-term contract “on the basis of requirement and without restriction on any sector”, without the help of contractors.

According to the Occupational Safety, Health and Working Conditions Code, all workers earning up to Rs 18,000, who migrate from one state to another, will be covered under the proposed law.

CII Director General Chandrajit Banerjee said the three codes have taken into consideration the interests of migrant workers, gig economy workers and unorganised workers, and have also ensured operational freedom to manufacturers.