Recently, The Parliament has passed three labor laws related bills. These bills are — Industrial Relations Code Bill 2020, Social Security Code Bill, 2020 and Occupational Safety, Health and Working Conditions Code Bill, 2020.
Talking about Industrial Relations Code Bill, it seeks to amalgamate and combine three major laws governing employee-employer relationship, after making some key amendments to the provisions.
The Code consolidates the following central enactments and repeals them, Trade Unions Act, 1926 Industrial Employment (Standing Orders) Act, 1946 Industrial Disputes Act, 1947.
The Codes enacted now are modified versions of the Industrial Relations Code Bill introduced in 2019. Among these, the Industrial Relations Code is touted as one that would energise industry and spur economic activity, as it aims to free employees from the constraints of earlier labour laws.
It defines ‘workers’ to include, besides all persons employed in a skilled or unskilled, manual, technical, operational and clerical capacity, supervisory staff drawing up to ₹18,000 a month as salary. It introduces ‘fixed term employment’, giving employers the flexibility to hire workers based on requirement through a written contract. Fixed term employees should be treated on a par with permanent workers in terms of hours of work, wages, allowances and other benefits, including statutory benefits such as gratuity.
The ID Act specifically exempts from the definition of hospitals or dispensaries, educational, scientific, research or training institutions, khadi or village industries, any activity, being a profession practised by an individual or body or individuals, if the number of persons employed by the individual or body of individuals in relation to such profession is less than ten, and any activity, being an activity carried on by a co-operative society or a club or any other like body of individuals, if the number of persons employed by the co-operative society, club or other like body of individuals in relation to such activity is less than ten.
The new Code Bill expands the definition to ‘strike’ to include “the concerted casual leave on a given day by fifty per cent. or more workers employed in an industry”.
As per the definition, ’employer’ means :Head of the department,Occupier of the factory, Manager of the factory under clause (f) of sub-section (1) of sec 7 of the Factories Act. The person who, or the authority which has ultimate control over the affairs of the establishment and where the said affairs are entrusted to a manager or managing director, such manager or managing director; Contractor; and Legal representative of a deceased employer.
Where there is more than one trade union in an establishment, the sole negotiating union status will be given to the one that has 51% of the employees as its members. It has been brought down from the 75% requirement in the 2019 version. Where no union qualifies under this criterion, the employer must constitute a ‘negotiating council’ consisting of representatives drawn from the various unions, with only those with at least 20% of employees as its members.
The Industrial Relations Code, 2020, bring new rules for hiring and firing of labour in mid-sized and large industries, making retrenchment easier. This effectively brings the “north American hire-and-fire model to the Indian hinterland economy in the hope that businesses recoup and add more jobs on a net basis,” said labour economist KR Shyam of XLRI, Jamshedpur.