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Introduction:

The Four Labour Codes introduced by the Indian government—Wages, Industrial Relations, Social Security, and Occupational Safety, Health and Working Conditions—aim to simplify and consolidate the complex and fragmented labor laws in India, promoting ease of business while ensuring worker welfare.

Merits of the Labour Codes:

  1. Simplification of Laws: The codes consolidate 29 labor laws into four, streamlining compliance and making it easier for businesses to understand and follow regulations.
  2. Flexibility for Businesses: The codes provide greater flexibility in hiring, retrenchment, and fixed-term employment, facilitating labor market adaptability and promoting investment.
  3. Social Security Net: The Social Security Code extends benefits like EPF and ESI to gig and platform workers, expanding the social safety net.
  4. Improved Worker Rights: Provisions for minimum wages and timely payment have been standardized, offering protection to more categories of workers.

Demerits of the Labour Codes:

  1. Weakening of Labor Unions: The Industrial Relations Code makes it harder to form unions and allows easier retrenchment for businesses, potentially weakening workers’ bargaining power.
  2. Limited Applicability: Certain benefits apply only to establishments with a minimum number of workers, leaving small businesses and informal workers unprotected.
  3. Centralization of Power: The codes give more power to the central government, which may reduce the autonomy of states in addressing local labor issues.

Progress So Far:

  • The codes have been passed by Parliament but have yet to be fully implemented, as states are in the process of finalizing rules. There is also resistance from trade unions, which argue that the codes favor employers at the cost of workers’ rights.

Conclusion:

The Four Labour Codes offer potential benefits for ease of doing business and worker protections, but concerns about worker rights, social security, and enforcement need careful attention to ensure balanced reforms in India’s labor market.

Legacy Editor Changed status to publish October 16, 2024