Business Desk, ETV Bharat: Keeping in mind both the needs of workers as well as the industry, the Parliament on Wednesday passed three key labour reforms – one being the Industrial Relations Code 2020.
The new code promises new welfare reforms for workers while keeping in mind the ease of doing business for industries. “We have simplified and made effective Industrial Relations Code so that peace and harmony prevail in the industrial units,” said Santosh Gangwar, minister of state for labour and employment in Rajya Sabha on Wednesday.
Here’s a key look at what’s in store for industrial workers under the new Industrial Relations Code 2020:
THE ‘GOOD’ PROVISIONS
For the first time in the Industrial Relations Code, a provision of re-skilling fund has been made with the objective of increasing the chances of employment again if any worker is retrenched. These workers will be given 15 days’ salary for this. Retrenchment refers to the termination of service of a worker for any reason other than disciplinary action.
The code says that the fund shall consist of contribution from the employer or from any such other sources as may be prescribed by the appropriate government.
THE ‘NOT-SO-GOOD’ PROVISIONS
Layoffs and retrenchments
The code raises the threshold for an establishment to seek prior permission of the government before closure, lay-off, or retrenchment from 100 workers to 300 workers.
Also, the 2019 Bill had empowered the government to both increase or decrease this threshold. But the 2020 Code only allows an increase in the threshold through a government notification.
Justifying the change, Gangwar pointed out that labour is the subject of concurrent list, and the concerned state governments have right to change the laws. He informed that as many as 16 states, using this right, have already increased this limit.
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The minister also informed that according to the Economic Survey 2019, after increasing this threshold from 100 to 300 in the state of Rajasthan, along with the number of large factories, there has also been an increase in employment generation of workers and an unprecedented reduction in layoffs.
“This makes it clear that changing this one provision will motivate investors to set up large factories in the country, and by setting up more factories, more employment opportunities, more workers in our country will be generated for,” he said.
Strikes
The new Code now provides that no worker employed in an industrial establishment can go on strike without giving to the employer a notice of strike within 60 days before striking, or within 14 days of giving such a notice.
“Prior to going on the strike, the 14-day notice period obligation has been imposed on every institution to attempt to end the dispute through amicable negotiations during this period. Neither the workers nor the industry has any benefit from the workers going on the strike,” Gangwar said.
Also, in a slight relief for trade unions, during a strike, the sole negotiating union (in case there are more than one registered trade union functioning in an establishment) can now have 51% workers as members instead of the earlier requirement of 75%.
However, if no trade union is eligible to become the sole negotiating union, a negotiating council will be formed consisting of representatives of unions that have at least 20% of workers as members. The 2019 Bill had a lower threshold of 10%.
