India’s Parliament passed three labour codes in the monsoon session of 2020: the Industrial Relations Code, the Code on Social Security and the Occupational Safety, Health and Working Conditions Code.
Along with the Code on Wages passed in August 2019, the four codes merge 44 pre-existing labour laws.
The codes were meant to streamline and simplify overlapping labour laws, which fall under the Concurrent List of the Constitution. They were set to be rolled out on April 1, 2021, although they are yet to see the light of day.
Implementation of the four labour codes has been deferred because of the delays by states in finalising rules.
So far, only Uttar Pradesh, Punjab, Madhya Pradesh, Uttarakhand and Jammu & Kashmir have published draft rules for the codes. About 21 states, including major states such as Maharashtra, West Bengal, Andhra Pradesh and Tamil Nadu, have not notified the draft rules yet.
Bihar has published draft rules for three codes, Gujarat and Karnataka for two, while Odisha has published them for only one code.
According to Prashant Singh, vice president and business head – compliance and payroll outsourcing at TeamLease Services, the main reason for the delay was the closure of labour ministries in the states due to lockdowns. Neither has the Central government set a deadline for states to publish the draft rules.
“The draft central rules have not yet been published as final rules. Most of the state governments copy the central rules and we have seen that many questions have not yet been clarified or answered in the draft central rules, hence states are awaiting clarification from the Centre before they start drafting their rules,” Singh added.
Even the draft rules for the first code that was passed have not been finalised yet. The Central government has notified only a few provisions under the Code on Wages, which was passed almost two years ago.
“The onset of the second wave of COVID-19 has dented the progress under the codes as the entire government machinery is now focussing primarily on controlling COVID-19,” a lawyer in the employment domain said on condition of anonymity.
Another reason was the assembly elections in four states, which made the framing of rules a lower priority, the lawyer said, noting that the codes also attracted a lot of criticism and it would have been difficult for the Central government to bring on board opposition party-ruled states quickly.
“It is interesting to note that despite the delay in implementation of the codes, the government has not issued any deadline for the states to submit their rules,” lawyer said.