This article is written by Chandana Pradeep, from School of Law, University of Petroleum and Energy Studies, Dehradun. This article analyzes the new changes that were brought by the “Industrial Relations Code, 2020”, and also looks into why such amendments were needed.
Table of Contents
Introduction
According to the Constitution of India, “Labour” falls under the concurrent list which gives power to both the State as well as the legislature to make laws and amend the same. The concept of labour law has been a dynamic field as it keeps on changing with time and circumstances. The Parliament recently made a huge amendment where labour law has been consolidated into three laws which are the Industrial Relations Code, Social Security Code and the Occupational Safety, Health and Working Conditions Bill which have been discussed in detail in this article.
Concept of labour
“Labour” though is considered to be a strong backbone of the economy, it is often not looked upon with such importance. Labour by definition is the work which is done by people with the use of their physical or mental strength for an income most likely in the form of monetary nature.
The different type of work which is done by the workers regardless of whether it is skilled or not which is done for an employer and the workers who do it are considered as their employees.
Laws governing labours in India
Over the years, the protection of labourers has gained importance so that the rights of the employees are protected as well and not just that of the employers. And for that, there have been a lot of Laws which have been enacted by the Government of India as well.
There have been laws which have been made so that the employees have a voice and their concerns can be represented and be heard by the employers.
Oftentimes, the employers take the work done by the employees for granted as they have a dominant authority over them, and because of this, specific laws have been enacted over time for the protection of their rights. Some of the laws that have made to serve this purpose are as follows:
- Trade Unions Act, 1926: This Act was one of the primary Acts that had been made so that the workers had a platform to voice out their concerns with regard to anything in relation to their field of work such as the employers, wage, working condition, etc. as the employees have a right to form trade unions to represent them.
- Industrial Disputes Act, 1947: This Act goes hand in hand with the Trade Unions Act, 1926. This Act has been implemented and has specific sections so that the workers can not be terminated without a proper reason which is justified along with other laws that protect their rights.
- Minimum Wages Act, 1948: This Act was enacted so as to ensure that there would be a minimum wage that would be given to the workers and no amount lesser than the minimum wage could be given to the workers. The minimum wage which has been decided varies according to the States as the factors that determine the minimum wage are the type of work that the person does along with how much income is needed to fulfill human needs.
- Other laws: Other laws which work towards the protection of the rights of these employees are The Factories Act, 1948, Maternity Benefits Act, 1961, Payment of Bonus Act, 1965, etc.
All these laws have been enacted so that the employees have a platform to raise their concerns as well as to protect their rights and if they have been violated can approach the help of the court as well.
Over the course of time, the laws have been amended keeping in mind the various issues and concerns that the workers are being faced with in their workplace.
A recent law that had been enacted to protect the rights of employees is the Sexual Harassment of Women employees at Workplace Act, 2013 which came into effect on December 2013 after a series of sexual harassment issues had been increasing.
Historical background
History of the International Labour Organisation
Labour laws had been first recognised internationally after seeing the deplorable conditions of the workers after the World War that had taken place and that resulted in the development of the International labour Organization (ILO).
After the war period, there was growing social unrest as the workers were not given the things they had been promised during the war and their living conditions were decreasing day by day. The new organisation had the power to develop the international standards of labour and to also supervise their implementation. This organisation also gave the workers as well the employers equal decision-making powers and slowly this had been replicated in different countries as well including India.
The ILO was built on the principle of achieving progress and overcoming the conflict of interest through methods such as dialogue and incorporation in an environment that is harmonious and peaceful.
History of Trade Unions in India
The Trade Unions Act of 1926 has been one of the first Acts to be enacted to protect the rights of employees and they came into existence after the World War the conditions of the workers were not the best as the price of things for daily needs had increased exponentially and along with the West, Indian workers also had an awakening to ask for their rights.
In pursuit of this, the first strike had occurred in the year 1877 at Bombay, where the aim was to voice out the concerns that were faced by the employees against the working conditions in the Bombay Mill Workers and slowly after the Bombay Mill Hands Association had been formed in the year 1890, and this organisation is one of the first Trade Unions which had been established in India.
Even though the trade unions had been made, there were a lot of issues and problems that were arising as the trade unions were not allowed to work properly for various reasons and the representatives were often been put in jail, which was counterproductive to the actual reason as to why a trade union was made in the first place.
The Royal Commission of Labour was of the opinion that the Act should be reexamined after every three years and the limitations which were imposed on the Trade Unions had to be reconsidered. There were various amendments done to The Trade Unions Act, 1926.
After this, there were other Acts which were made to protect the rights of the employees too so that the laws could evolve according to standards and development of labour.
Amendments introduced in labour laws in 2020
Recently, the parliament had passed three bills that completely changed the face of labour laws. All the existing 29 Labour Law statutes have been consolidated and only this new law which has been passed will be governing labour laws in India. The three new Bills which have been passed by the parliament are The Industrial Relations Code Bill, 2020, The Code on Social Security Bill, 2020, The Occupational Safety, Health, and Working Conditions Bill, 2020. There have been various amendments that have taken place in these codes which are as follows:
Industrial Relations Code Bill, 2020
According to the Industrial Employment Standing Orders Act of 1946, it was important for workplaces hiring more than 100 workers to have service rules formulated specifically mentioning how the workers should conduct themselves as well as other rules and regulations to be followed in the workplace and all of these rules had to be known to the workers compulsorily. Now according to the new bill, it has been increased to workplaces having more than 300 workers. Thereby making it not necessary for employers to make these rules if they have less than 300 employees and due to this, it makes it easier for the companies to hire and remove the employees.
In consonance with the Industrial Disputes Act of 1947 under Section 22, it was made mandatory for employees to give a 6 week notice period before going for a strike in case of any public utility, this has been amended and public utility has been replaced with “Any industrial establishment”. Along with that, if there is any ongoing dispute settlement in the court, the employees who want to go on strike have to give a 60 day notice period to their employers even if the proceedings have been completed. According to this new provision, the scope to go on strike has been reduced significantly.
Another amendment introduced in this Bill under Section 83 of the Industrial Relations Code is that a reskilling fund will be provided by the employer to any employee who has been retrenched and the amount that the person will get will be the amount as what he would get in the last 15 days of work.
Social Security Code Bill, 2020
A provision of this Bill under Section 6(1) states that a new board would be set up called The National Social Security Board which would advise the government on new schemes that would benefit the workers in the unorganised sector or the workers who work on a temporary basis.
Any employers who hire a person on a temporary basis (gig workers), have to contribute at least 1 or 2% of their annual turnover for the social security of these gig workers.
Occupational Safety, Health, and Working Conditions Bill, 2020
The definition of “Inter-State migrant workers” under Section 2 (zf) had changed from what it was in the 2019 Bill. Now it defines the term as when a person from another willingly comes to another State in search of work and has an income which is Rupees 18,000 or less will be termed as Interstate Migrant Workers, this new bill also gives a lot of advantages to the interstate migrant workers as well.
The definition of “Factory” has been amended from what it was in the 2019 Bill and according to this Bill, it excludes Mining from the definition. The other amendments include that the total working hours of an employee have been fixed to eight hours a day, and women can work in any workplace and if they are required to work in any dangerous workplace, the employers are bound to take necessary precautions before.
Reasons for such amendments
One of the major reasons as to why there has been such a major change in the Labour law is because it is the need of the hour especially given this covid era, the rights of workers have to be protected. Many workers have been facing a lot of issues regarding their employment as many are terminated and laid off without a reason or facing concerns with their workplace environment etc, therefore it is important for laws also to be amended along with the development of labour for the smooth functioning of the economy.
Moreover, consolidating all the various laws with regard to labour law is easier to follow and there is no confusion as to the applicability of the laws too.
Repercussions of such amendments
Like two sides of a coin, there are repercussions to this amendment as well. Some of them are as follows:
- The concept of fixed-term contracts– This, though for the major part is a boon for the workers as through a fixed-term contract they can avail benefits even if they are employed for a short period of time but the issue of dominance can arise and power play can happen as there is no form of middlemen here and the negotiation is done just between the employee and the employers, power play can be a negative factor.
- Strikes become more difficult– The present Bill makes it even harder for workers to go on a strike as the amended procedure has in fact led to a delay in the process of holding a strike.
- Not all terms are specified– Though there have been new inclusions in the definition, it also does not include a few other definitions of terms which are used often in the Code such as that of workers who get a salary which exceeds that of Rupees 18,000, or “manager”, “Supervisor” etc have not been included.
- The Civil Court has been barred– The civil court can not hear cases with regard to this Bill, but in case of disputes the employees can notify the specific appellate authority and the remedy they can seek is only by filing a writ petition in the high court so this in a way does not allow people to file their cases starting from a lower court.
Suggestions
The sole suggestion would be that new codes are balanced in terms of cause and effect and they are more equitable with regard to the employee-employer relationship.
Conclusion
The workers have been a strong pillar in the development of the economy from time immemorial and these laws are needed to be reformed with the needs and development of the working class so that the laws are also evolved with the passing of time and so that the rights of the workers are also protected.
The new amendments were very much necessary with regard to the global crisis that has hit because of which hundreds have lost their jobs and these laws also help to strike a balance with the employer-employee relationship which is very much needed.
References
- https://www.mondaq.com/india/employee-benefits-compensation/971020/labour-laws-amendments–initiatives-by-state-governments-to-provide-impetus-to-economic-activity
- https://www.prsindia.org/billtrack/code-social-security-2020
- https://www.livemint.com/news/india/promise-and-pitfalls-of-new-labour-deal-11601390386472.html
- https://www.ilo.org/global/about-the-ilo/history/lang–en/index.htm
- https://www.clearias.com/trade-unions-history-labour-unions-in-india/
- https://www.bloombergquint.com/law-and-policy/new-labour-codes-top-5-changes-that-will-impact-employers-and-employees
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