Provisions of Labour Codes expand social security, bring clarity to wages and employment terms: Nasscom

Provisions of the Labour Codes expand social security, bring clarity to wages and employment terms: Nasscom

The National Association of Software and Service Companies (Nasscom) lauded the government's notification released on November 21, bringing key provisions of the four Labour Codes into effect, calling it an important milestone in India's efforts to modernise its labour framework.

These Codes were enacted between 2019 and 2020 consolidating 29 central labour laws that were largely framed between the 1930s to 1950s in a very different economic context.

"This step signals a clear intent to move towards a more contemporary, coherent and nationally consistent labour architecture," the technology industry body said in a statement.

Nasscom said that the Codes expand "social security, strengthen workplace safety and health, and bring greater clarity to wages and employment terms."

A comprehensive approach

Nasscom highlighted Government's analysis on how significantly the workforce requirements have evolved. From minimum wages for all workers, a national floor wage, mandatory free annual health check-ups, timely payment of wages to stronger provisions supporting women's participation in all forms of work, including night work with due safeguards.

As part of the four labour codes, the government has introduced the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020 and the Occupational Safety, Health and Working Conditions Code, 2020.

Transparency for Technology and IT services companies

By bringing in changes such as mandating salary disbursement by the 7th of every month, provisions to facilitate women to work night shifts in all establishments and “equal pay for equal work” for IT and IT-enabled services employees; the government will enhance IT industry's attractiveness as a hub for high value technology and digital services.

"For the technology industry and its workforce, the eventual full implementation of the Codes can bring greater predictability and transparency," said Nasscom.

Further, provisions on written appointment letters, fixed term employment with parity of benefits, expanded coverage of social security, recognition of gig and platform work and specific attention to timely salary payments, and structured grievance mechanisms for IT enabled services will be relevant to a skilled and mobile talent base, the industry body noted.

As rules are finalised, Nasscom will now focus on helping the industry ensure a smooth transition.

"A key priority will be to help ensure that the central framework under the Codes is harmonised with state level requirements, including shops and establishments laws, so that overlapping obligations and unintended compliance challenges do not arise," Nasscom said.