Remedial rejig

Hands that serve are holier than the lips that pray. Labour Laws, one of the most important laws for the economy of any country, cater to those serving hands as well as the majority of corporate and government sectors. The legislature has been wanting to revamp antique laws and has therefore drawn up four Labour Codes, namely: the Code on Wages 2019, the Industrial Relations Code 2020, the Code on Social Security 2020, and the Occupational Safety, Health and Working Conditions Code 2020, popularly known as Labour Codes 2020, combining various statutes with certain modifications. These are yet to be implemented.

The Codes lay down an array of reforms. The provisions for cinema workers, currently restricted to feature films, entail expansion and inclusion of audio-visual workers. This means that feature films, non-feature films, television, web-based serials, talk shows, reality shows, animation, cartoon depiction, digital production, musicians, singers, news readers, dancers, stunt persons, technical artists, etc., will all be covered within the Labour Codes when implemented. The Codes also expand the definition of 'working journalists' to cover electronic/digital media.

Retrenchment and closure provisions are sought to be eased, but there won't be immediate hire and fire. The Code allows factories, mines, plantations, etc., with up to 300 workers to retrench or close without seeking permission from the appropriate government. Until now, this provision has only been applicable to units with up to 100 workers, except in states like Uttar Pradesh and a few others where the number is already 300.

Pertinent changes have been included with respect to the definition of wages. According to the Code, the total excluded components, which are not considered for purposes of Provident Fund, gratuity, bonus, etc., of the cost to company (CTC) should not exceed 50 per cent of the total remuneration. Many are apprehensive that this would increase the Provident Fund, gratuity, etc. However, upon an in-depth reading of the provisions, some of these costs are controllable, if not all.

In the case of fixed-term employees, gratuity will be applicable upon mere completion of 1 year of service, unlike regular category employees who require 5 years of service. For working journalists, it will be 3 years.

The definition of "employer" in the new Codes includes contractors. Currently, such a provision exists only under the Building and Other Construction Workers' (Regulation of Employment and Conditions of Service) Act, 1996. Although most current labour laws recognise the responsibility of the principal employer and contractor for making compliances, these statutes do not specifically include contractors as "employers". Uniform registration under Contract Labour and other provisions will become applicable. The license for contractors will be valid for a period of 5 years. Contract labour provisions will be applicable to establishments with 50 or more workers after the implementation of the Codes, the current figure being 20. Disbursement of wages will have to be done mandatorily through bank transfer or electronic mode. Payment in any other mode will only be allowed with express permission. In the case where the principal employer is obliged to pay wages to contract labour due to non-compliance by the contractor, provisions will be made for the recovery of such payment from the security deposit made by the contractor when obtaining a license.

It will be mandatory for employers to issue appointment letters. Contractors will also need to provide experience certificates.

Specific benefits have been included for gig workers, platform workers, and unorganised workers. Inter-state migrant workers will include workers from other states who come directly on their own or are called by employers or engaged through contractors.

The time limit for filing cases before a labour court/industrial tribunal will be 2 years; currently, there is no time limit. A re-skilling fund will be established, and a prescribed amount per worker will need to be transferred by the employer during retrenchment, in addition to compliance with other retrenchment provisions.

Modifications will be made regarding daily working hours, leaves, paydays, etc. For strikes, workers/unions will have to give a 14-day notice to the employer. The validity of such a strike notice will remain for a period of 60 days. Therefore, urgent strikes will not be allowed after the implementation of the Codes. During conciliation, court cases, arbitration proceedings, etc., and a prescribed period thereafter, strikes will be prohibited. Just as strike is a weapon in the hands of workers, lockout is in the hands of the employer. Similar provisions have been made for lockouts as well. Specific provisions will be in place for the recognition of trade unions, negotiating bodies, etc.

Some Industrial Tribunals may have a Division Bench comprising one judicial officer and one officer from the government.

There are provisions regarding the notification of vacancies to the government in companies. Furthermore, the government will be able to extend the ESI scheme to hazardous occupations even if a single employee is employed. A fixed limitation period of 5 years will be set for Provident Fund Authorities to initiate an inquiry for non-compliance.

There are some other modifications as well, but these are the pertinent ones. Provisions that cater to current structures, along with clear-cut execution, will improve the economy and enhance India's integration into the global economy.

The writer is a practising Advocate in Supreme Court and High Court of Delhi. Views expressed are personal