Labour reform bills to face stiff resistance

After the land bill, the Modi government may face stiff resistance from the Opposition and the trade unions on labour bills. The government is likely to introduce at least two of the labour bills–-the Labour Code on Industrial Relations and Employees’ Provident Funds (Amendments) Bill in the monsoon session of Parliament.

All central trade unions have joined hands to oppose the bills and decided to go on strike on September 2. The Centre is trying to convince trade unions to withdraw the call. The labour ministry is trying to use its political proximity to the Bhartiya Majddor Sangh (BMS), an affiliate to the Sangh Pariavar, to reach a settlement with the unions.

However, trade union leaders are saying that there would not be going back on the call, unless the government withdraws the amendments. Most of the opposition political parties are likely to support the call. 

The bill to amend Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, is ready to be introduced. As far as the Labour Code on Industrial Relations is concerned, the ministry is compiling the suggestions it has received on the draft bill. The date for submitting suggestions expired on last Tuesday.

The EPFO Bill seeks changes to extend the Provident Fund facility to the workers of establishment with minimum 10 workers. Earlier, it was available in establishments with 20 workers. It will also give options to employees to opt out from EPF and related benefits to join New Pension Scheme. The definition of wage has also been changed. The new definition includes basic wage and other allowances except house rent and bonus.
The new legislation will be applicable to categories of establishments; the special schedule has been abolished.

The harsher punishments that were proposed in the draft bill for violations by the employers have been withdrawn.

The trade unions are aggressively opposed to the option to exit the EPF scheme. They argue that this is bound to be violated and employers would make it a pre-condition for employing a worker.