New labour codes in India – An Introduction

The need for labour reforms was being felt in India for a long time, especially due to the changed market conditions after the Globalization of the Indian economy and the economic boom due to the IT revolution.

Keeping this in mind, the government of India formed the second national labour commission on 15th Oct 1999 under the chairmanship of Mr Ravindra Verma. The commission submitted its report to the government on 29th June 2002. Based on the recommendation of the commission, the government of India started working on drafting the new codes from the year 2015 for ensuring ease of business. The four codes were finally ready and approved by both houses in the year 2019.

The codes were drafted considering the 60 recommendations made by the national labour commission in its report. As per recommendation number 6, prescribed by the commission, the labour codes were categorized into four broad types as

• Code on wages
• Social security codes
• Occupational safety, health and working conditions code also known as OSHW code and
• Industrial relations code also known as IR Code

The other recommendations were also considered while drafting each of the codes.

This course gives an overview of all the codes to enable a learner to learn the codes well. The course has been designed, for paying specific emphasis on the changes in the role of an HR executive which are expected to happen after the codes are implemented. While much has been discussed about these codes in Media, the one thing that has been unanimously agreed by all the commentators is that, the codes are going to streamline the compliance requirements, that the corporates are required to fulfil as a part of multiple labour codes. On one hand, it is going to bring ease of business and reduce the work of HR executives substantially, while on the other hand the provisions related to social security and overtime compensation, are sure to increase the burden on the corporate treasuries.

The financial impact of the codes has been a major reason behind the opposition of the corporates to the codes. Along with the oppositions posed by the corporates and trade unions, the Covid 19 pandemic has also played a vital role in the delay in the implementation of the codes.

As the pandemic has started to subside, the Government is sure to resolve the disputes with the corporates and unions about the code and make the path clear for enforcement of the codes, after the rules to be formed by the state governments are in place. This makes it necessary for the HR executives and aspirants to obtain detailed knowledge about the labour codes, for which this course will surely work as the first step.