New labour codes deferred: Your take-home salary to remain same from April 1

Contrary to government officials' earlier assertions, the four Labour Codes, which the government claims will bring "far-reaching" reforms, will not be coming to effect from April 1, as rules are yet to be notified.

The top officials of the Ministry of Labour and Employment had earlier said that the government was likely to implement the four Codes from April 1.

However, sources on Tuesday said that the government is not moving ahead with its implementation from Wednesday.

Read | What new labour codes bring for gig and platform workers

The Parliament had in December 2019 passed the Code on Wages, while in September last year, it gave its go-ahead to the Social Security Code, the Code on Industrial Relations and the Code on Occupational Safety, Health and Working Conditions. With this, 29 central labour laws have been codified into four broad Codes.

These Codes remove stringent conditions on winding up of companies and ease restrictions on firing from 100 to 300 employees by firms without government sanction, which the government believes will attract more investment and job creation. Trade unions will have to give 60-day notice for strikes.

The Code of Wages mandates that the basic pay of an employee will be 50 per cent of the total salary or cost-to-company (CTC), which could result in a decrease in take-home salary while rising in retirement benefits.

Read | 4-day work week, strike notice: Key things in new labour codes

Sources said that central rules are not framed and notified following which states also need to notify rules as Labour is in the concurrent list. This exercise is not finished and if the government moves ahead without this, it could land in a legal tangle, sources added.

One of the considerations for the delay in the rolling out of the Codes was the ongoing Assembly elections, sources said.

There is also strong opposition from trade unions, including the RSS-affiliated BMS that said these Codes were "tilted too much in favour of the employers and bureaucrats". CPI(M)-backed CITU has said these Codes are a recipe for imposing "virtual slavery on the working people".

Read | Labour Ministry finalises rules under four codes, reforms to be a reality soon

Provisions of the four Codes had found space in Finance Minister Nirmala Sitharaman's Budget speech on February 1. She said social security benefits will be extended to gig and platform workers in India -- a first across the globe -- while women will be allowed to work in all categories of the workplace as also in night-shifts with adequate protection.

Referring to the passage of four Labour Codes, she had said that the government would conclude a process that began 20 years ago, with the implementation of the Codes.

"Minimum wages will apply to all categories of workers, and they will all be covered by the Employees State Insurance Corporation. Women will be allowed to work in all categories and also in the night-shifts with adequate protection. At the same time, the compliance burden on employers will be reduced with a single registration and licensing, and online returns," she had said.