All fixed-term employees will become eligible for gratuity payments after one year of continuous service, instead of five years earlier, and a national minimum wage will cover all workers, instead of a few scheduled industries, according to the provisions of the four labour codes that came into effect Friday.
The Union government notified the four codes passed by Parliament during 2019-20 and the rules needed to make them operational on Friday, Union labour minister Mansukh Mandaviya said, briefing reporters.
The codes also define gig and platform work for the first time. Section 2(35) of the Code on Social Security, 2020 defines a gig worker as “a person who participates in a work arrangement and earns from such activities outside of a traditional employer–employee relationship”.
Among major changes, employers across sectors will have to mandatorily offer free annual medical checkups to workers above the age 40 aimed at fostering preventive healthcare. Also, no worker can be hired without being issued a written appointment letter.
Fixed-term employees will get the same benefits as permanent staff, including leave, regulated working hours and medical benefits. While the codes require all companies to pay salaries on time, IT firms must release salaries by the 7th of every month.
During 2019-20, Parliament had passed The Code on Wages, 2019, Industrial Relations Code, 2020, Occupational Safety, Health and Working Conditions (OSH) Code, 2020 and the Code on Social Security, 2020 to replace a set of 29 archaic laws. But the codes were made effective Friday after being deferred several times.
Overall, the reforms give companies greater freedom to hire and fire workers, bring new safety standards and expand social security benefits. The new provisions allow women to work night shifts and enter industries and sectors that fall under the “hazardous” category, such as mining, a move in line with the government’s goal of enhancing the female labour force participation rate. The entry of women in newer roles and night shifts are subject to their consent and necessary safety measures, the provisions show.
“The labour codes promote employment opportunities for women and are gender neutral,” Union labour minister Mansukh Mandaviya said Friday.
Enrolment in the Employees’ State Insurance Corporation has been made compulsory for establishments with even one employee engaged in hazardous processes and coverage will now be available countrywide, against select notified regions earlier.
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