The new labor laws, which are scheduled to go into effect on July 1st, will significantly alter the nation’s workplace culture.
New labor laws: starting on July 1, four days of work, 12 hours of duty, and a pay cut. If the proposed laws are implemented, everything from working hours to take-home pay is expected to be altered.
What are the laws and what adjustments will there be? We look at it.
On September 29, 2020, the Center announced four labor codes: the Code on Wages, Industrial Relations Code, Social Security Code, and the Code on Occupational Safety, Health, and Working Conditions. These 29 labor laws, which have not changed since Independence, are expected to be replaced.
To enforce these laws in their separate jurisdictions, states must notify rules under the four codes.
The draught guidelines for the Code on Wages have only been issued by 23 states and Union Territories.
When all states agree to the codes, they will be put into effect. The newly proposed labor laws provide businesses with the choice to operate on 4 working days rather than 5 or 6.
Four days at work do not, however, equal less effort.
If the number of working days is decreased, there will be more hours worked. Employees will need to fulfil the 48-hour work week’s daily 12-hour duty within a four-day work week. This indicates that they are required to labor 12 hours each day rather than eight.
Paid holidays are not affected by the fewer working days. Four-day workers would receive three paid holidays each week.
The take-home pay is anticipated to decrease under the new laws as Provident Fund (PF) contributions from both the employer and the employee rise. It is mandatory that the PF contribution be equal to 50% of gross pay. The number of working days needed to qualify for leaves has been lowered from 240 to 180 under the new labor laws.
In accordance with current legislation, a new employee must work 240 days before becoming qualified to take a leave.
The new labor regulations, however, have lowered the requirement for a new employee to work 180 days before being eligible for leave.
For each 20 days of employment, one day of leave is earned, but the amount of leave earned does not change.
The maximum number of leaves that may be carried over will remain at 30.
The new rules have been drafted to improve the well-being of employees. They recognize the work-from-home (WFH) model which was implemented during the COVID-19 pandemic. Companies are required to have some basic principles in place regarding WFH to ensure that the work-life balance is not affected.
The new industrial relations legislation would make conducting business easier by allowing businesses with up to 300 employees to proceed with layoffs, retrenchments, and closures without obtaining authorization from the government.
According to The Business Standard, all companies with up to 100 employees are currently immune from needing government approval for layoffs, retrenchments and closures.
Employees who are classified as workers will benefit from the new labor laws. The new regulations’ definition of “workers” is similar to that found in the Factories Act. This does not imply, however, that factory-based blue-collar workers are the only ones eligible for the benefits.
The service industry is included in the scope of the new labor laws. Every individual contributor (person not primarily engaged in managerial, administrative, or supervisory roles—except for supervisors, for whom a limit of Rs. 18,000 in wages per month has been prescribed) should be able to claim employment under the new labor codes, regardless of the tasks assigned to them or the pay they receive.
