Author – Mihika Bhatnagar, Student from University of Petroleum and Energy Studies
The 2nd National Commission on Labour has characterised the existing Labour Laws as complicated and containing obsolete and outdated provisions, not in consonance with the prevailing situation. [1]As a result, four new codes were introduced by the Indian Parliament with the view to consolidate and amend the existing forty four codes on Labour Law. The four new codes are- Industrial Relations Code, 2020, Code on wages, 2019, Code on Social Security, 2020 [“CODE”], Occupational Safety, Health and Working Conditions Code, 2020. Among the four codes, only the Code on Wages has been passed by the Central Government.
Introduction to the Code
In this blog, we are going to focus on the Code of Social Security, 2020, which blends the following nine existing Labour Laws into a single one- Employee’s Compensation Act, 1923, The Employee’s State Insurance Act, 1948, The Employee’s Provident Funds and Miscellaneous Provisions Act, 1952, The Employment Exchanges Act, 1959, The Maternity Benefit Act, 1961, The Payment of Gratuity Act, 1972, The Cine Workers Welfare Fund Act, 1981, The Building and Other Construction Workers Welfare Cess Act, 1996, and The Unorganised Workers Social Security Act, 2008.
The Code on Social Security, 2020 contains fourteen chapters and 164 Sections. It is yet to come into existence on any date the Central Government may announce in the official Gazette.[2] However, Section 142 of the code which deals with the Application of Aadhar Card number to register the employees or unorganised worker has been notified by the Ministry of Labour and Employment.
Earlier, the Social Security schemes only used to cover a small segment of the organized work force that is the workforce having direct employer- employee relationship. This Code is a right based system for the universalization of Social Security contribution to be made by employer/ employee.[3] The aim of this code is to provide social security to every class of worker and to stop the oppression of workers. This code has made historic changes in the field of betterment of labours, be it any class of workers.
Important Definitions under the Code
The definition of employee has been changed by the code and it is applicable to all the laws subsumed by the code. Earlier, the definition of employee was not included in some of the acts. The definition of Inter- State migrant worker is also added under section 2(41) of the Code, considering the fuss which was created during the lockdown due to Covid-19.
Unorganised worker, under the code means a home-based worker, self-employed worker or a wage worker in the unorganised sector and includes a worker in the organised sector who is not covered by the Industrial Disputes Act, 1947.[4]
The basic meaning of Gig workers are those workers who work on hourly or part time jobs. Their job is of temporary nature. Gig workers are defined under the code as, a person who performs work or participates in a work arrangement and earns from such activities outside of traditional employer-employee relationship.[5] Some of the examples of gig workers may be- independent contractors, freelancers etc.
Platform workers, as the name suggests, works for an organisation by providing specific services using an online platform. The code defines platform workers as a person engaged in or undertaking platform work.[6] An example of platform worker would be the cab drivers working for Ola, Uber etc.
The Unorganised Workers Social Security Act, 2008 has been sub merged by the code. The main reason for this merge and the addition of the definitions for gig and platform workers can be to carry out business in India easily. This is also seen as a visionary to attract Foreign Companies to pursue their business in India. The development will not just be for the labours, but also for the country. It provides benefits to the group of employees which were previously excluded from the environment benefit.[7]
Provisions for Unorganized, Gig, and Platform Workers under the Code
For the first time ever, provisions have been made to register all the unorganised workers on a National Portal. They will be provided Unique Labour Identifier Number which will be portable across the country. Chapter IX of the Code is dedicated towards the provisions for Social Security of unorganised, gig and platform workers. Every unorganised, gig and platform workers who fall under the age criteria of sixteen to sixty needs to get themselves registered in order to avail the benefits of the concerned schemes framed.[8]
The Central Government may, by notification frame schemes for unorganised, gig and platform workers and their families related to Life and Disability insurance, Accident insurance, Health and Maternity Aids, Old Age Care, Crèche and other schemes all found suitable under section 114 of the Code.
The Gig and Platform worker’s funds would be managed by the Central Government and the State Government’s schemes would be financed by the State Government.[9]
Section 112 of the code is a unique development, which states that the Central Government may set up a free call centre for the unorganised, gig and platform workers for their facilitation and assistance regarding the Social Security schemes.
Conclusion and Recommendations
The Code is a crucial step taken in the country for the prevention of oppression and mismanagement with the unorganised, gig and platform workers, which has enriched them with various facilities and by notifying Section 142 of the Code, it has been made clear that very soon, the Code will also be notified in the Country. However, it is very important to note that this Code still needs some changes for the betterment of these labours. If we read the definitions of unorganised, gig and platform workers together, one may come to the conclusion that the definitions are not at all clear and somehow overlapping, that it makes it hard to understand which scheme will apply to whom. The definitions also need to be more explanative, so that there is no problem in interpreting them.
The Code has also put an upper limit of 60 years for the registration of such workers, which should either be removed or extended. This is because such labours are mostly seen working their whole life and by putting such age limit, they are restrained from getting the benefits even after working so hard. They are given benefits and there are going to be schemes made especially for them in the future, but what they lack is labour rights. But in every seed of good, there is always a seed of bad, and this Code is a tree full of good, all it requires is a few changes.
[1] Sridhar Rajagopalan, Deciphering Chapter IV of the Industrial Relations Code, 2020 – A Case of Legislative Conundrum, 2021 SCC OnLine Blog
[2] Code on Social Security,2020, Section 1(3), No. 36, Act of Parliament(India)
[3] MOHIT-PC, Annual Report 2020-21-11-2-20, Chapter-6,pg-64,viewdocpdf.aspx
[4] Code on Social Security,2020, Section 2(86), No. 36, Act of Parliament(India)
[5] Code on Social Security,2020, Section 2(35), No. 36, Act of Parliament(India)
[6] Code on Social Security,2020, Section 2(61), No. 36, Act of Parliament(India)
[7] In Re: Problems and Miseries of Migrant Labourers and Ors. (29.06.2021 – SC), (MANU/SC/0387/2021)
[8] Code on Social Security, 2020, Section 113, No. 36, Act of Parliament(India)
[9] Code on Social Security, 2020, Section 110, No. 36, Act of Parliament(India)