Economic Survey asks states to expedite implementation of labour codes

The Economic Survey has called upon states to expedite the implementation of the Labour Codes.

The survey emphasized the need for swift enactment of these codes by the states, highlighting that despite the extensive groundwork laid, there remain regulatory hurdles that are more stringent than those in many advanced economies.

'However, there remains scope to expedite the enactment of Labour Codes by the states. In addition, there exist other regulatory hurdles to employment generation, some of which are stricter than advanced economies." says the survey.

The Government of India undertook a major reform by rationalizing and amalgamating 29 central laws into four Labour Codes between 2019 and 2020.

This extensive process involved consultations with various stakeholders and the public from 2015 to 2019. 

The primary objective was to promote employment creation, streamline the web of antiquated legislations, reduce the multiplicity of definitions and authorities, and enhance transparency and accountability through the use of technology in enforcement.

The four Labour Codes- code on Wages, 2019, industrial relations code, 2020, code on social security, 2020, occupational safety, health and working conditions code.

These codes aim to provide a comprehensive framework for wage regulation, industrial relations, social security, and occupational safety, health, and working conditions.Under the Constitution of India, "Labour" is a subject in the Concurrent List, meaning both the Central and State Governments have the authority to legislate on it.

The Codes empower the Central Government, appropriate Governments, and State Governments to make necessary rules.

A requirement for pre-publication of these rules in the states' Official Gazettes ensures public consultation.As of now, 32 states and union territories have pre-published their draft rules under the Code on Wages, 2019; 30 under the Industrial Relations Code, 2020; 31 under the Code on Social Security, 2020; and 31 under the Occupational Safety, Health and Working Conditions Code, 2020.

One of the landmark features of the new Labour Codes is the extension of social security benefits to gig and platform workers through a Social Security Fund.

This fund is financed by contributions from the Central and State Governments, aggregators, and Corporate Social Responsibility (CSR) activities.

Additionally, the definition of inter-state migrant labour has been simplified, ensuring better protection and clarity for this vulnerable section of the workforce.

Despite these significant advancements, the Economic Survey underscores the need for states to accelerate the implementation process.

The survey points out that delays and additional regulatory challenges continue to impede employment generation.

The economic survey further says that addressing these issues is crucial for leveraging the full potential of the Labour Codes and fostering a conducive environment for both workers and employers in India.