INDUSTRIAL RELATIONS CODE BILL, 2019

INDUSTRIAL RELATIONS CODE BILL, 2019

Key facts:

• The code proposes to amalgamate The Trade Unions Act, 1926, The Industrial Employment (Standing Orders) Act, 1946, and The Industrial Disputes Act, 1947.
• It is the third out of four labour codes that have got approval from the cabinet.

The Bill:

1. Seeks to allow companies to hire workers on fixed-term contract of any duration.
2. Has retained the threshold on the worker count at 100 for prior government approval before retrenchment, but it has a provision for changing ‘such number of employees’ through notification.
3. Provides setting up of a two-member tribunal (in place of one member) wherein important cases will be adjudicated jointly and the rest by a single member, resulting speedier disposal of cases.
4. Has vested powers with the government officers for adjudication of disputes involving penalty as fines.
5. Introduces a feature of ‘recognition of negotiating union’ under which a trade union will be recognized as sole ‘negotiating union’ if it has the support of 75% or more of the workers on the rolls of an establishment.
6. As several trade unions are active in companies, it will be tough for any one group to manage 75% support, hence taking away their negotiating rights. In such a case, a negotiating council will be constituted for negotiation.
7. Underlines that fixed-term employees will get all statutory benefits on a par with the regular employees who are doing work of the same or similar nature.
8. Under the code, termination of service of a worker on completion of tenure in a fixed-term employment will not be considered as retrenchment.
9. Proposes setting up of a “re-skilling fund” for training of retrenched employees. The retrenched employee would be paid 15 days’ wages from the fund within 45 days of retrenchment. 

Significance:

The Indian economy grew at 5% in the June quarter, a six-year low, while the country’s factory output shrank for the second straight month at 4.3% in September, recording its worst show since the present series was launched in April 2012.

The ease of compliance of labour laws will promote the setting up of more enterprises, thus catalysing the creation of employment opportunities in the country.

Sources: the Hindu.