Labour Code on Industrial Relations, 2020

Labour Code on Industrial relations, 2020

Ministry of Labour and Employment introduced four Bills to consolidate 29 central laws in 2019. The Standing Committee has submitted its report on all three Bills. The government has replaced these Bills with new ones on September 19, 2020.

Objectives Labour Code on Industrial relations bill, 2020

1. These Codes regulate: (i) Wages, (ii) Industrial Relations, (iii) Social Security, and (iv) Occupational Safety, Health and Working Conditions. While the Code on Wages, 2019 has been passed by Parliament, Bills on the other three areas were referred to the Standing Committee on Labour.
2. It aims to create greater labour market flexibility to encourage entrepreneurs to engage in labour-intensive sectors and to improve ease of doing business in India.
3. It would consolidate three laws i.e. Trade Unions Act, 1926; Industrial Employment (Standing Orders) Act, 1946 and the Industrial Disputes Act, 1947.

Key Features of Labour Code on Industrial relations, 2020

Contract workers: It seeks to allow companies to hire workers on fixed-term contract of any duration. Fixed term employment refers to workers employed for a fixed duration based on a contract signed between the worker and the employer.

Reduced Threshold: Companies employing up to 300 workers will not be required to frame rules of conduct for workmen employed in industrial establishments. Presently, it is compulsory for firms employing up to 100 workers.

Dispute redressal: It provides for setting up of a two-member tribunal (in place of one member) wherein important cases will be adjudicated jointly and the rest by a single member, resulting in speedier disposal of cases.

Regulation for Trade Unions: Introduces a feature of ‘recognition of negotiating union’ under which a trade union will be recognized as sole ‘negotiating union’ if it has the support of 75% or more of the workers on the rolls of an establishment.

Statutory benefits: Underlines that fixed-term employees will get all statutory benefits on a par with the regular employees who are doing work of the same or similar nature.

Regulates strikes: As per the bill, the workers in factories will have to give a notice at least 14 days in advance to employers if they want to go on strike. Presently, only workers in public utility services are required to give notices to hold strikes.

Re-skilling Fund: Proposes setting up of a “re-skilling fund” for training of retrenched employees. The retrenched employee would be paid 15 days’ wages from the fund within 45 days of retrenchment.