Discuss the merits and demerits of the four ‘Labour Codes’ in the context of labour market reforms in India. What has been the progress so far in this regard? (250 words)
The four Labour Codes, introduced between 2019-2020, aim to streamline 29 existing laws into four codes: Wages, Industrial Relations, Social Security, and Occupational Safety, to enhance ease of doing business and safeguard workers’ rights.
Merits of the Labour Codes
- Simplification of Laws: Combining 29 laws into four codes reduces legal complexity, aiding compliance for both employers and workers.
- Expanded Social Security: The Social Security Code extends benefits to gig and platform workers, including delivery services and ride-hailing apps.
- Uniform Wage Definition: The Code on Wages standardizes wage definitions, ensuring fair payment across sectors.
- Flexible Hiring & Firing: The Industrial Relations Code allows firms with up to 300 employees to hire/fire without government approval, promoting industrial flexibility.
- Improved Safety Measures: The Occupational Safety Code mandates health check-ups, enhancing worker welfare in hazardous industries.
Demerits of the Labour Codes
- Weaker Worker Protections: The Industrial Relations Code makes it tougher to strike and form unions, diluting bargaining power.
- Limited Informal Sector Coverage: Despite reforms, informal workers, who form 90% of the workforce, still lack adequate coverage.
- Extended Work Hours: The Occupational Safety Code allows work shifts of up to 12 hours, risking worker fatigue.
- Implementation Ambiguities: Undefined terms, like ‘fixed-term employment,’ may lead to exploitation.
- Centralized Control: Increased central government power over labour matters limits state autonomy.
Progress So Far
- Legislative Status: All codes have been passed but are not yet implemented; states are finalizing rules.
- Partial Adoption: States like Uttar Pradesh and Madhya Pradesh are gradually adopting these codes.
Conclusion
Balanced reforms require clear implementation and inclusivity, with coordinated efforts from central and state governments for the benefit of all.