Labour Reforms In India

At Simpliance, we continuously strive to give you the most accurate and latest information on Labour laws across India. As part of this endeavor we bring to you the latest revisions and reforms in Labour Laws which are going through a complete makeover.

These initiatives by the Central and State Governments are expected to enhance ease of doing business & generate jobs. Simpliance is geared up to provide all the support and information you need to navigate through this revolution, one the many our country is undergoing currently. Keep watching this space for more news.

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Labour Code On Wages

The Code on Wages Bill proposes to merge four acts viz.

  • Minimum Wages Act, 1948
  • Payment of Wages Act, 1936
  • Equal Remuneration Act, 1976
  • Payment of Bonus Act, 1965

The code will give common definitions for all acts mentioned above and the effective sections have been merged for easy compliance management.

The subsequent rules which will complement the code have not yet been released. These rules will have the forms and compliances, which will be common across the acts.

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Definitions
  • Employee definition has been amended to include Managers, Supervisors and Administrative persons
  • No discrimination among male, female and transgender employees on the ground of sex in the matter of wages.
  • Disputes to be decided by the authority notified.
Minimum Wages
  • The Minimum Wages for different Scheduled Employments will be abolished. There will be one common minimum wage for all employments which will also include previously not included employments.
  • Central Government will fix a National Minimum Wage and the State Governments cannot fix wages below that. State Governments can however fix the rates above it and will fix factors for distinct categories of employees
Payment of Wages
  • Wages will be deposited in the same in the bank account of the employees, electronically or by cheque. Wages can be paid in cash, up to an amount which would be notified by the appropriate government.
  • Payment of wages has been made applicable to all class of establishments and employees. Previously only employees earning less than 18,000 wages per month were covered and establishments defined or notified were covered.
Equal Remuneration
  • The Act has been summarized in the code, there has been no changes to the provisions.
Payment of Bonus
  • Only the employees earning monthly salaries below the amount notified by the appropriate government will be eligible for bonus.
  • Employee will be disqualified from bonus if he is dismissed from service on conviction for sexual harassment also.
  • Bonus shall be paid by crediting sum in the bank account of the employee.
  • Bonus linked to productivity has been discontinued. Profit sharing Bonus will have more importance.


Labour Code On Social Security

Ministry Of Labour and Employment has prepared a Preliminary draft of the Code on Social Security & Welfare by amalgamating all existing Labour Laws related to Social Security (Total 15 Labour Laws including Employees Provident Fund Act, Employees State Insurance Act, Maternity Benefit Act, Payment of Gratuity Act, Employees Compensation Act, Unorganised Social Security Act and various Welfare Cess / Fund Acts).


Labour Code On Industrial Relations

Code on Industrial Relations were earlier drafted and put on the Website of the Ministry of Labour & Employment inviting comments of the stakeholders/public. These Codes are under consideration of the Government at present.


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