Law on overtime still gives employer the upper hand

S Murlidharan

The Code on Occupational Safety, Health and Working Conditions Bill, 2019, passed by the Lok Sabha (the Bill) has a few pluses, but on the crucial issue of overtime to workers, it disappoints. While retaining the extant twice the normal rate concept for overtime, it has made a few cosmetic changes:

• The employee’s prior written consent must be taken before s/he does overtime;
• The hourly rate would also include retention pay, in addition to basic and dearness allowance.

Prior written consent is a farce. Employees in India are in awe of authority figures in their organisations.  So much so, they would simply comply when asked to do overtime.

Overtime in India doesn’t by and large conform to the worldview of N R Narayana Murthy, the redoubtable Infosys co-founder.  To be sure, the points made by him in his famous 2007 e-mail to his staff pulling them up in dulcet terms for doing overtime with an eye on creature comforts -- free Internet surfing, snacks and drop-home -- might have had resonance in Infosys, but in factories and other sweatshops across India, overtime is often a necessity for the employer to meet his seasonal demand spikes as well as meet deadlines committed to customers.

Factory employees especially do not work overtime with a view to cozying up to their bosses for annual increments and promotion. For them, it is often a necessity in both the senses -- compulsion by the employer and to beef up their normal abysmal salary.

But then not all employees are satisfied with monetary recompense.  Like in the US, employees should be allowed compensatory off. In other words, the Bill has, as indeed its predecessor law on the subject, assumed that all employees can be homogenised in terms of their preference for overtime recompense whereas the truth is many of them value and cherish leisure and family togetherness more.  Choice between overtime payment and compensatory off would have been the fine goldilocks solution.

The Bill, however, is not obsessed with overtime alone. On the contrary, its sweep is rather wide. The Narendra Modi government ever since its inception in 2014 has been having a pan-India focus on important policy matters, the stark example of which is the Goods and Services Tax (GST).  With the ultimate aim of extending the safety and healthy working conditions to all workforce of the country, the Bill proposes to enhance the ambit of provisions of safety, health, welfare and working conditions from the existing about 9 major sectors to all establishments having 10 or more employees, where any industry, trade, business, manufacture or occupation is carried on, including, IT establishments or establishments of the service sector. It is in this context that the law on overtime assumes greater importance -- its applicability across the country cutting across industries.

The other significant changes proposed by the Bill are:

1. One registration for an establishment instead of multiple registrations. This will create a centralised database and promote ease of doing business.
2. Employer to provide free-of-cost annual health checks-up for employees above the prescribed age for prescribed tests and for prescribed establishments. This is a good move as industries like asbestos are innately risky in terms of fostering lung cancer.
3. First-time statutory provision to issue appointment letter to every employee of the establishment with the minimum information prescribed by the appropriate government. The provision of appointment letter will result in formalisation of employment and prevent exploitation of the worker.
4. Women would be permitted to work beyond 7 PM and till 6 AM subject to the safety, holidays, working hours or any other condition as prescribed by appropriate government in respect of prescribed establishments. However as with overtime, for night work by women too, their prior written consent (to guard against exploitation by men) would be a must. This will promote gender equality and is in tune with demands from the various forums, including international organisations, as keeping them away from night shift leads to protective discrimination.  However, the scepticism expressed by yours sincerely in the context of written consent for overtime applies with equal force to women doing graveyard shifts with their written consent.

Despite the wide-ranging nature of the proposed changes, the one on overtime has caught the imagination of the discerning because of its overarching pan-India, pan-industry character.

The author is a chartered accountant and columnist. Views are personal.