Popular Questions Related to Labour Laws

The new “wage” definition is certainly complex, with inclusions and certain exclusions with a cap on exclusions @ 50% of the total remuneration. Therefore, in a situation where the only component included is Basic, and is less than 50% of the remuneration, the proviso of the definition would ensure that the “wage” is 50% of the remuneration. For all practical purposes like calculating contributions for PF/ESIC, the calculation for gratuity etc, the “wage” will be 50% of the Remuneration, even if the Basic is less than 50%. However, if the Basic is more than 50% of remuneration, then the wage for such calculation would be the actual Basic.

As per the OSH Code, a contractor who has an establishment in more than one State and is desirous of obtaining a license for supplying or engaging contract labour or undertaking or executing the contract work in more than one State or for pan-India makes provision for “National License” for a contractor but this is subject to requisite qualifications or criteria to be fulfilled by the Contractor as may be prescribed by the Central Government.

special provision have been added related to the employment of women in which women are entitled to be employed in all establishments for all types of work and they may also be employed, with their consent before 6 a.m. and beyond 7 p.m. i.e., night. But this is subject to conditions relating to holidays, working hours and adequate safety, which shall be prescribed in the Rules.

OT applies to all the workers including the person engaged in supervisory levels earning less than INR 18,000 (Rupees Eighteen Thousand only) per month. But it does not apply to employees engaged in a supervisory capacity drawing a wage exceeding INR 18,000 (Rupees Eighteen Thousand only) per month or such other amount as may be notified by the Central Government and to employees engaged in a managerial and administrative capacity.

Yes. It is not only the definition of wage that is expected to change. For example, the concept of who is a “Worker” is now clearly defined. The term “Employee” is also defined clearly, and it includes “Worker”. There are few provisions such as the ones that regulate working hours, overtime, annual leave that apply only to workers and not all employees. Similarly, all IR Code provisions apply only to workers. Therefore, it is important that every employer relooks at their HR policies, organization structure, role, and responsibility of every employee to understand the impact of provisions of the code and realign as required.

Yes. The Code on Wages, 2019 applies universally to all employees irrespective of sector, category or employment type.

Yes. Every employee who has worked for at least thirty days in an accounting year is eligible for bonus as per prescribed wage limits.

No. The Industrial Relations Code, 2020 does not ban strikes. Workers can still go on strike after giving a mandatory 14-day notice.

No. Retrenchment compensation and mandatory notice provisions continue under the IR Code. Establishments with 300 or more workers require prior government permission.

Yes. Fixed-Term Employees are eligible for EPF, ESI, gratuity and other benefits equal to permanent employees.

No. The provisions related to registration and functioning of trade unions continue under the Industrial Relations Code, 2020.

The definition of wages includes basic pay, dearness allowance and retaining allowance along with certain remuneration components as prescribed under labour codes.

If allowances exceed 50% of total remuneration, the excess amount is added back to wages for statutory calculations.

Yes. A uniform definition of wages applies across all four Labour Codes for statutory calculations and compliance purposes.

Gratuity becomes payable on resignation, retirement, termination, disablement, death or expiry of a fixed-term employment contract.

Yes. Women can work in night shifts with proper consent and adequate safety, transport and security arrangements.

Yes. Contract workers are covered under welfare facilities and these facilities are to be provided by the principal employer.

The Code prescribes 8 working hours per day and 48 hours per week as standard working conditions.

Yes. Fixed-term employees are covered under the OSH Code and are entitled to benefits including appointment letters and health check-ups.

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