Context:
-
India has enacted four comprehensive Labour Codes to modernize, simplify, and rationalize its labour law framework, replacing a fragmented system built over decades.
-
The reform aims to balance worker welfare, ease of doing business, formalization, and economic growth, with full operationalization targeted by 2025.
Key Highlights:
Four Labour Codes – Overview
-
Code on Wages, 2019 – Universal minimum wages, timely payment, and wage equality.
-
Industrial Relations Code, 2020 – Simplifies dispute resolution, trade union rules, and retrenchment norms.
-
Code on Social Security, 2020 – Expands social security to unorganized, gig, and platform workers.
-
Occupational Safety, Health and Working Conditions (OSH) Code, 2020 – Strengthens workplace safety and health standards.
Labour Market Context
-
India has over 643 million workers, one of the largest and youngest workforces globally.
-
Gig and platform workers, expected to reach 2.35 crore by 2029–30, are formally recognized under the new framework.
Worker-Centric Reforms
-
Universal minimum wage floor and clearer definitions of wages.
-
Timely payment of wages and standardized working hours.
-
Enhanced women’s participation through equal remuneration, maternity benefits, and safe night work provisions.
Ease of Compliance and Formalization
-
Single registration, license, and return system for employers.
-
Reduced compliance burden, especially for MSMEs.
-
Encourages enterprises to enter the formal economy, extending legal protections to workers.
Occupational Safety Focus
-
Mandatory safety committees, periodic health check-ups, and improved working conditions under the OSH Code.
Federal Dimension
-
State-level alignment and rule-making are critical for uniform implementation and clarity across India.
Relevant Prelims Points:
-
Issue: Outdated and fragmented labour laws inhibiting worker protection and economic efficiency.
-
Causes: Multiplicity of laws, complex compliance, limited coverage of informal workers.
-
Government Initiative: Enactment of four Labour Codes consolidating 29 central labour laws.
-
Benefits:
-
Wider social security coverage
-
Improved ease of doing business
-
Boost to formalization and productivity
-
-
Challenges:
-
Delays in state adoption
-
Concerns over worker protections vs flexibility
-
-
Impact: Strengthened labour governance and inclusive growth.
Relevant Mains Points:
-
Definitions & Concepts:
-
Labour Codes, formalization, gig and platform workers
-
-
Social Justice Dimension (GS II):
-
Inclusion of unorganized workers
-
Gender equity in employment
-
-
Economic Dimension (GS III):
-
Labour market flexibility
-
MSME growth and investment climate
-
-
Governance Aspect:
-
Simplified compliance through digital systems
-
Cooperative federalism via state implementation
-
-
Way Forward:
-
Capacity building of labour departments
-
Awareness among workers and employers
-
Timely notification of state rules
-
Robust grievance redressal mechanisms
-
UPSC Relevance (GS-wise):
-
GS II: Governance, Social Justice, Welfare legislations
-
GS III: Indian Economy, Employment, Labour reforms
-
Prelims: Labour Codes, gig workers, formalization concepts