The Union Cabinet gave a nod to the Labour Code on Industrial Relations Bill 2019 on November 20, 2019, the third code under labour reforms. The draft of the same had been floated last year for inter-ministerial consultations.
The bill ushers in the concept of ‘fixed-term employment’ on a contract basis. Companies usually hire contract workers through contractors however, with the introduction of fixed term employment, they can hire workers under a fixed-term contract with the flexibility to alter the length of the contract depending upon the industry’s seasonality. During the tenure of the contract, the workers will be treated equally as the regular workers.
“While this means workers can be hired seasonally for six months or a year it also means that all workers will be treated at par with the regular workers for benefits”, said the finance minister, Nirmala Sitharaman.
The threshold on the worker count for prior government approval before retrenchment remains unchanged i.e 100 however through notification, employers can change the threshold.
It also proposes setting up of two-member tribunal the responsibility of which will include adjudging the important cases co-operatively and the rest by a single member for speedy disposal of cases.In addition, it has entrusted the government officers for adjudication of disputes involving penalty thus reducing the extra load on tribunal.
The code considers amalgamation of Industrial Disputes Act, 1947, the Trade Unions Act, 1926, and the Industrial Employment Act, 1946.
The government has allowed fixed-term employments across all sectors last year but it failed to withdraw desired results out of it as the states did not notify its provisions. However, the new bill intends to codify it and ensures a pan-India impact. The Industrial Relations Bill is expected to be presented for discussion in the Parliament’s winter session. Once approved by the parliament, it will be a legislation to be abided by all.