New Labour Law In India 2020

The list of laws passed by the government of India to protect the trade unions, condition of workers, remuneration, employment, and industrial relations. Recently Indian parliament has replaced 29 existing labour laws and also simplified and modernised the regulations of the labour. This entire article is about the list of new labour laws in India 2020. Here, the complete details about the new labour bills are explained in detail. 

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What is Labour Code Bill 2020? 

The new labour code bill 2020 was passed by the recommendation of the second national commission on labour 2002. By the new labour act 2020, the central government of India has replaced 29 existing labour laws with four new labour code bills. The major aim of the latest labour law is to protect the rights of workers and to facilitate the growth of employees and employers.

The list of labour code bill 2020 passed by the houses of the parliament and received by the President of India are given below. 

1. Code on Wages

2. Industrial Relation Code

3. Social Security Code

4. Occupational Safety, Health and Working Conditions Code

Occupational Safety, Health and Working Conditions Code, 2020 

On 19th September 2020, the code was introduced in Lok Sabha and it was passed on 22nd September 2020. The same labour code bill was passed in Rajya Sabha on 23rd September 2020. On 28th September 2020, the labour code bill received presidential assent. 

The main aim of the code bill is to consolidate and amend the occupational safety, health and working conditions of the employees.  

The Occupational Safety, Health and Working condition code 2020 is introduced to replace the 13 existing labour laws. The existing 13 laws are the contract labour act 1970,  the factories act 1948, the building and other construction workers act 1996, the mines act 1952, the plantations labour act 1951, the dockworker’s act 1986, the inter-state migrant workmen act 1979, the beedi and cigar workers act 1966, the motor transport workers act 1961, the working journalist and other newspaper employees and miscellaneous provisions act 1955, the working journalists act 1958, the sales promotion employees act 1976, and the cine-workers and cinema theatre workers act 1981. 

Advantages In Occupational Safety, Health and Working Conditions Code 

Based on this code, the government has been allowed to give at least 20 employees to work with power and 40 employees can work in a process without power. The labour act 2020, is created to provide all the necessary safety measures to protect the workers from hazardous activity regardless of the number of workers. According to the act, no workers should work for more than 8 hours a day and 6 days a week. If the employees are pulled to work for more than the working time, they should get overtime pay, which is twice the normal wages. Usually, the overtime compensation is applicable for the 10 workers at a time. This code completely prohibited discrimination based on the gender of workers.  This code also empowered the women workforce. 

This labour code bill is mainly to provide safety, suitable working hours and holidays for working women. This code also allowed women to be involved in the work before 6. am and beyond 7 pm with suitable safety measures and safeguards. 

The labour act 2020 also gave some rights to transgenders by providing separate washrooms, bathing places and locker facilities for the transgenders too along with male and female employees of the organisation. 

The labour code bill also made some alterations to contractual workers. As per that, they prohibited the contract labours in core activities.  They imposed a law to appoint contract employees in the normal functions. Also said that the contract employees have no need to work as full-time workers. 

Usually, the person who is travelling from one state to another state for their work even as unorganised workers will be considered as the interstate migrant workers. Now, the central government has announced that they will consider the maximum wages earning people as the inter-state migrants.  Through this latest labour law, they have the option to avail themselves of the benefits of the public distribution system either in the native state or the state of employment. Interstate migrants can avail of the benefits available under the building and other construction cess funds in the state of employment. The interstate migrants can avail themselves of insurance and provident fund benefits in the same establishments. The central government also maintains the list of inter-state migrant workers in a portal. 

In order to maintain the welfare of the unorganized workers, the government of India has established a Social Security Fund. The government will spend the amount received through the composition of the offences for the unorganized workers.  

The ministry of Labour and employment made a proposal on 19th November 2020, based on that the organization can make them work for a maximum of 12 hours a day including the intervals and safety measures. But the working hours of the employees should not exceed 48 hours in a week. The spread over time is including the working hours plus the time for lunch and other breaks.

Code on Social Security, 2020

On 19th September 2020, the code on social security 2020 was introduced in Lok sabha and passed on 22nd September 2020. On 23rd September 2020, the same bill was passed in Rajya Sabha and the President of India received this assent on 28th September 2020. 

The main objective of introducing the code on social security 2020 is to provide social security to all the employees and workers in the organised or unorganised or any other sectors.

The code on social security 2020 was introduced by replacing nine existing labour laws. The list of laws are payment of gratuity act, 1972, employees’ state insurance act, 1948, cine workers welfare fund act, 1981, the employees’ provident funds and miscellaneous provisions act, 1952, employees’ compensation act, 1923, building and other construction and unorganised workers’ social security act, 2008, maternity benefit act, 1961, workers cess act, 1996 and employment exchanges act 1959. 

Advantages of the Code on Social Security 2020

This code bill mainly deals with the unorganized workers, gig workers and platform workers, which was created by the central government. The state government also established separate social security funds for unorganised workers. The national social security board is also providing the administer schemes for the welfare of gig workers and platform workers. This board has five representatives of aggregators, who are appointed by the central government, the Director-General of the ESIC and five State Governments representatives. The representatives from the central government officials are about 5 to 10 members. For the unorganised workers, the state board has 7 to 10 members. 

In order to protect the welfare of the gig and platform workers, the central government and state government will give some funds for support. They also supported the workers of nine sectors: content and media services, ride-sharing services, food and grocery delivery services, and e-marketplaces. The contribution of the government will only stay from 1 - 2% of their annual turnover and also that will not exceed more than 5% of the amount. The gratuity period of the journalists was reduced from five to three years. 

According to the labour law 2020, the maximum imprisonment for obstructing an inspector has been reduced from one year to six months. The fine amount for the employer who is charged for crime needs to pay a fine of Rs. 50000. In addition, the central government has deferred or reduced the employer’s or employee’s contributions for three months during the pandemic, endemic or national disaster. 

Industrial Relations Code, 2020

The labour law bill 2020 based on the Industrial relations code was introduced in Lok Sabha on 19th September 2020. This bill was passed in Lok Sabha on 22nd September 2020 and in Rajya Sabha on 23rd September 2020. Finally, the president of India received assent on 28th September 2020.

The main aim of the industrial relations code is to consolidate and amend the laws related to trade unions,  investigations and settlements of industrial disputes and conditions of employment in industrial establishments or undertakings. This law replaced three existing laws namely, the industrial disputes act, 1947, the industrial employment act, 1946 and the trade unions act, 1926. The government of India will also release any new industrial establishment or class of establishments from the provisions of the Code in the public interest.

Advantages of the Industrial Relation Code 2020

All the industries with at least 300 workers must have the standard orders like grievance redressal mechanisms for workers,  manner of informing workers about work hours, holidays, paydays, and wage rates and classification of workers, termination of employment. 

Before closure, lay off or retrenchment of the industrial establishments in the country with more than 300 workers should receive permission from the government in advance. According to the law, before laying off the employees due to the inability of an employer, they should provide employment to workers even in adverse conditions. All the employees must receive retrenchment during the termination of the services of an employee other than disciplinary action. 

As per the code bill, workers with more than 51% as a member in a trade union should be recognized as the sole negotiating union. If it has more than one registered trade union of workers functioning.  To form a negotiation council, it should have at least 20% of the workers as members. Other than this there is no other eligibility for the sole negotiating union.

According to the new labour law 2020, If the workers have any dispute related to the discharge, dismissal, retrenchment, or termination of the services of an individual worker, the workers can raise for the Industrial tribunal for justice related to the dispute. The workers need to give 14 days prior notice to the employers if they need to discontinue or are going to enter into the strike. 

The Code on Wages, 2019 

On 23rd July 2019, this code was introduced in Lok Sabha and passed on 30th July 2019. Meanwhile, the code on wages bill passed in Rajya Sabha on 02nd August 2019. Finally, the bill came for presidential assent on 08th August 2019.  The main aim of the code on wages 2019 is to regulate wages and bonus payments in all industries, trade and manufacturing sectors and businesses. This bill replaced the existing 4 labour laws. That four laws are the Minimum Wages Act, 1948, Payment of Bonus Act, 1965, Payment of Wages Act, 1936 and Equal Remuneration Act, 1976.

Advantages of Code on Wages 

This bill is applicable for all the employees, including the people working mines, railways, and oil fields. The state government and the central government have the right to make decisions on the wages of the employees. The wages mentioned in the codes include the salary, allowances and all other compensation including bonuses, travel allowances..etc. According to the bill, the floor wages of the employees are fixed by the central government based on the living standard of the workers. So, the flood wages of the employees will differ from the geographical locations. 

The central government and state government will announce the minimum wages of the employees more than the floor wages. The government will fix the minimum wages based on the difficulty of the work and skills of the workers. The government will revise and review the pay of employees every five years. This code will prohibit employers from hiring people for less than the minimum wage. Even the central or state government cannot reduce the minimum wage of the employees. 

As per the rule, the government also fixed the number of working hours of the employees. If it exceeds, the employees will receive compensation for the overtime, which is twice the normal wages.  The employer should fix the wages for employees daily, weekly, monthly or fortnightly. Also, this law insisted employers make payments in the mode of coins, currency notes, electronic mediums, or through bank accounts. 

This law also provided rights to deduct the wages of employees based on their absence from duty, accommodation provided by the employer or the advance payment made to the employee. But the deduction should not be more than 50% of the total wages of the employees.  

All the employees should receive a maximum of 20% of their annual wages as a bonus. Also, it should be at least 8.35% of the monthly salary or of Rs 100. This law also prohibits discrimination based on gender. All the employees should receive the salary based on their skill, efforts, experience and job responsibilities. The state government and central government will advise providing more opportunities for women employees with the fixed minimum wages. One-third of members of the advisory board of the government should be women. 

The penalties imposed on the employees for their offence commitment by the employers should be less than the minimum wages of the employee. As per this code, the maximum punishment for this offence will be three-month imprisonment along with a fine of Rs. 1 lakh.

Here the advantages of the new labour law in India 2020 are given in detail. And the list of changes made in the new labour law is explained in detail.