The notification of the new Labour Codes in India has been long awaited since 2019 and has become a contentious topic of discussion and debate among experts and stakeholders. The Indian government consolidated the archaic labour laws into four codes, viz., Code of Wages, Code of Social Security, Industrial Relations Code, and Code of Occupational Safety Health and Working Conditions. The question that is currently on everyone's mind is whether these Codes will be implemented in the year 2023 or not. It seems that the Indian government wants to push the implementation of the Labour Codes after the general elections that are to be held in the year 2024.
The Indian Government has introduced the Labour Codes to streamline various labour laws and regulations to create a uniform legal framework applicable to all industries. However, the implementation of the Labour Codes has been delayed for various reasons, attributable to political resistance and opposition from labour unions. To ensure adequate implementation of the Labour Codes, the Indian government must show a strong political will to override such opposition. Given the controversy surrounding the three farm laws that were introduced in the past, the Indian Government is understandably cautious about implementing the Labour Codes, that could provoke a similar backlash from certain stakeholders. However, there are also expectations from foreign investors for the Indian Government to move forward with the Labour Codes, as the same are seen as an important step towards improving India's business environment, attracting investment and ease of doing business in India.
Stakeholders like the labour unions (which includes the Bhartiya Mazdoor Sangh) apprehends that the new Labour Codes are too employer centric, and their implementation may not translate into better working conditions, rights, and wages for workers. In order to address this the Indian Government must work towards a more balanced approach in consultation with stakeholders and ensure that adequate provisions for workers welfare (keeping in view the industry specific requirements including state specific social and cultural aspects) are included in the Labour Codes.
In a country like India, where informal labour is widespread, one of the biggest challenges of implementing any new labour law is to ensure compliance among employers operating outside the organised sector. To address this the Indian Government will need to adopt a multi-pronged approach that includes regulatory reforms, strengthening social security mechanisms, incentivising employers to register their workers and mandating the use of technology for monitoring and compliance.
Making a consensus with the state governments (especially governed by the party in opposition to the ruling party at the centre) in implementing state specific labour codes in line with the central labour codes is another roadblock in streamlining and unifying labour codes across India. Labour is a concurrent subject in the Indian Constitution, and the state governments have a significant role in implementing their specific labour codes. The Indian government while respecting the federal structure of India, must ensure to collaborate with the state governments and provide them with necessary assistance including training, resources, and technical support to have an effective and efficient implementation of the Labour Codes across the country.
While the new Labour Codes promise a range of benefits to India's workforce, their success hinges on their effective implementation and enforcement in a timely manner. India deserves a transparent, accountable, and equitable labour system that benefits both workers and employers. Therefore, it is imperative for any political party that will form the government at the centre in the year 2024 to take steps in bringing consensus amongst the various stakeholders through its political will to implement and enforce these Labour Codes.
Meanwhile, India Inc is reaching out to law firms in order to understand the significant changes in the labour laws, the revisions required in existing HR policies, studying the Labour Code Impact Assessment including but not limited to assessment of cost benefit analysis, aligning of the compensation structure in light of the new definition of 'Wages' and counselling employees to ensure a smooth adaptation as and when the Labour Codes goes live.
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