India: Parliament has passed Three New Labour Codes

As a major rationalising and simplifying exercise, India has attempted to consolidate 44 Central labour legislations into 4 comprehensive labour codes; (a) Code on Wages, 2019 (“Code on Wages“); (b) Occupational Safety, Health and Working Condition Code, 2020 (“OSHW Code”); (c) Industrial Relations Code, 2020 (“IR Code”); (d) Code on Social Security, 2020 (“Social Security Code”). The Code on Wages has already been notified by the Ministry of Law and Justice, Government of India in the year 2019. However, the Central Government is yet to notify the provisions of the Code on Wages.

In the month of September 2020, the OSHW Code, the IR Code and the Social Security Code were passed by both the houses of the Indian Parliament and also received presidential assent on 28 September 2020. The three abovementioned labour codes shall come into force on such date as may be notified by the Central Government.

OSHW Code:

The OSHW Code aims to consolidate and amend the legislations that currently regulate occupational safety, health and working conditions of individuals employed in establishments, while providing the required flexibility for making necessary rules and regulations with respect to the subject matter thereof.

The OSHW Code shall subsume the following Central labour law legislations: (a) the Factories Act, 1948; (b) The Mines Act, 1952; (c) The Dock Workers (Safety, Health and Welfare) Act, 1986; (d) The Building and Other Construction Workers (Regulation of  Employment and Conditions of Service) Act, 1996; (e) The Plantations Labour Act, 1951; (f) The Contract Labour (Regulation and Abolition) Act, 1970; (g) The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979; (h) The Working Journalist (Fixation of Rates of Wages) Act, 1958; (i) The Working Journalist and Other Newspaper Employees (Conditions of Service and Miscellaneous Provisions) Act, 1958; (j) The Motor Transport Workers Act, 1961; (k) The Sales Promotion Employees (Conditions of Service) Act, 1976; (l) The Beedi and Cigar Workers (Conditions of Employment) Act, 1966; and (m) The Cine Workers and Cinema Theatre Workers Act, 1981.

Social Security Code:

The Social Security Code shall subsume the following Central labour law legislations: (a) The Employees’ Compensation Act, 1923; (b) The Employees’ State Insurance Act, 1948; (c) Employees’ Provident Fund Act, 1956; (d) The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959; (e) The Maternity Benefit Act, 1961; (f) The Payment of Gratuity Act, 1972; (g) The Cine Workers Welfare Fund Act, 1981; (h) The Building and Other Construction Workers Welfare Cess Act, 1996; and (i) The Unorganised Workers’ Social Security Act, 2008.

One of the important aspects of the Social Security Code is that it includes within its sphere, certain non-traditional types of occupations/workers such as gig workers, platform workers and unorganised workers, and makes provisions for providing social security benefits to them. Further, under the Social Security Code, the scope of the term ‘employee’ has been extended to include contract labours as well. Also, an employer shall now be required to make certain social security contributions (such as the provident fund contributions) with respect to the contract labours as well.

IR Code:

The IR Code shall subsume the following Central labour law legislations: (a) the Industrial Disputes Act, 1947: (b) Industrial Employment (Standing Orders) Act, 1946; (c) Trade Unions Act, 1926. The applicability of the IR Code (and its Chapters thereof) on industrial establishments depends on various factors such as the number of workers in an industrial establishment and the nature and type of the industrial establishment.

For more information on these articles or any other issues involving labour and employment matters in India, please contact Avik Biswas (Partner) of IndusLaw at avik.biswas@induslaw.com or visit www.induslaw.com.