New Labour Codes

Unchallenged Attack on Workers

Notan Kar

The Bharatiya Janata Party (BJP)-led NDA government at the centre passed the new labour codes during the lockdown period on 23rd September, 2020, when the opposition parties were boycotting the session on the issue of the farm bill. The Industrial Relations (IR) Code, the Occupational Safety, Health and Working Conditions (OSH) Code and the Social Security (SS) Code along with the Code on Wages, 2019 were promulgated, incorporating earlier 44 labour laws. By this way, the government violated all the previous parliamentary procedures to get these acts passed in the most undemocratic way.

Through the Wage Code Bill, the Modi government has fixed the national Floor wage at rupees 178/- per day, which is less than the amount of rupees 375/- per day initially suggested by the Union Labour Ministry. Then this wage is much less than the wage fixed by government as minimum wage. It is also worth noting that in July 2018, the Expert Committee of the Government (Dr Anup Satpathy committee) itself had suggested the minimum daily wage to be at least Rs. 375/-, based on the price index. The Modi government is undermining its own committee recommendations, which is nothing but a big fraud with the working class of the country. In the name of establishing a national floor level minimum wage, the Bill has been formulated to destroy the struggle for minimum wage altogether. The Wage Code proposes 9 (nine) hours of working time. This is contrary to the standard practice of 8 (eight) hours of work. The minimum wage is also conventionally set for the 8 (eight) hour-work period. Making it 9 (nine) would effectively reduce minimum wage.

The Industrial Relations Code is an instrument for taking away the rights of the workers to unionise and struggle while giving full freedom to the management to hire and fire. According to the Code, government permission is now no longer required for lay-offs, closures or retrenchment of workers in a factory having less than 300 workers. The government can increase this number if required. Earlier the government’s permission was mandatory for lay-offs, closures or retrenchment in a factory with 100 or more workers. In India, 70% of enterprises have less than 300 workers. The Code states that if there are less than 50 contractual workers in a factory, labour law will not be enforced there. Now the provision for contractual workers is applicable if the number of workers in the factory is at least 20. Currently, unions need to give 14 days’ notice before a strike. Under the new rule, a 60-day notice is required. The bill states that if 51% of the workers of a factory are members of a union, then that union will be recognised as a ‘negotiation or bargaining union’. If no union has the stipulated numbers, then all the trade unions in the establishment can be part of the negotiating council. The Industrial Relations (IR) Code allows managements to hire contract workers directly through ‘fixed-term contract’. Then fixed-term contractual workers are not entitled to ‘retrenchment compensation’ like permanent workers.

The Social Security Code speaks for establishing a ‘National Social Security Board’ which shall recommend to the central government for formulating suitable beneficial schemes for different sections of unorganised workers like gig workers (who deliver door-to-door service) and platform workers (those online staff and workers). The Code simplifies labour laws to a large extent but there remains a lack of clarity in the definitions. Also, the Bill has not clearly specified the norms pertaining to social security schemes, health and safety standards, and working conditions and delegated these largely to the state governments. The Code has not universalised social security benefits for workers in the informal sector. Instead, it restricts the ability of labour officers to determine the quantum of provident fund and state insurance due to employees from employers. The Social Security Code will exclude virtually all welfare schemes assigned to permanent or temporary workers.

The OSH Code applies to those workers, i.e., persons not engaged in managerial or administrative role or supervisory role with a monthly wage exceeding INR 18,000. The Code suggests a national database for inter-state migrant workers to collect, compile and analyse their occupational safety and health statistics. The code allows management to engage women staff at night shift. The Code is restricted to establishments with 10 or more workers. This raises the question of whether workers under 10 in smaller establishments should not be covered by health and safety laws.

India is currently facing horrible job loss due to COVID-19. The Centre for Monitoring of the Indian Economy (CMIE) estimated 2.1 crore salaried jobs were lost following the lockdown. Under the new Codes, the employer will have the full opportunity to arbitrarily fix the terms and conditions of service of the workers and fire them at their will. The time has come for the toilers to unite and combat new labour codes and evolve strategies to counter the government’s out and out anti-labour policies.   

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Vol 55, No. 50, Jun 11 - 17, 2023