Parliament passed three key labour reform Bills that will provide greater flexibility to employers to hire and fire while ensuring social security for workers. The three Bills — Code on Occupational Safety, Health and Working Conditions; Industrial Relations Code and Social Security Code — were passed in the Rajya Sabha by a voice vote amid boycott by the opposition over the suspension of eight members.
The Lok Sabha passed the Bills on Tuesday. The three codes will now go to the President for his assent.
Replying to the debate on the bills in the upper house, labour minister Santosh Gangwar said: "The purpose of labour reforms is to provide a transparent system to suit the changed business environment."
The minister informed the house that 16 states had already increased the threshold for the closure of industrial units and laying off workers without government permission to 300 workers.
“States have been given flexibility to tweak labour laws as per their need,” he said.
He maintained that it was not good for employment generation to keep the threshold low at 100, because it discouraged employers to recruit more workers than this.
“Investors will be encouraged to set up big factories and employ more and more workers,” Gangwar said, explaining the rationale behind this provision.
He said these Bills would safeguard the interest of workers and provide universal social security to workers by expanding the ambit of the Employees' Provident Fund Organisation and Employees' State Corporation of India.
He also said there would be a social security fund to cover around 40 crore unorganised sector workers. Commenting on the Social Security Code, the minister said, provident fund benefits could now be availed of by all firms with 20 or more employees, as the schedule defining establishments has been done away with.
The government will also extend the benefits of the EPFO to self-employed, the minister added.
He sought to allay apprehension that workers’ right to strike had been withdrawn under the new Code.