Implementation of Labour Codes Deferred Beyond 1 April: Reports

Once the wages code comes into force, the way basic pay and provident fund of employees are calculated will change.

2 min read
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The government has delayed implementing the labour codes beyond 1 April, citing delay on the part of several industrial states that have not yet finalised their rules.

29 central labour laws governing occupational safety, minimum wages, and social security were consolidated into four Labor Codes. The Code on Wages was passed during the Monsoon Session of Parliament in 2019.

The Industrial Relations Code, the Code on Social Security, and the Occupational Safety, Health and Working Conditions Code, were all passed by the Parliament in 2020.

A senior labour ministry official said, “Implementation of labour codes looks unlikely from 1 April. The government wants at least some industrial states to notify rules across four labour codes along with the Centre to avoid any legal void,” The Economic Times reported.

Only Jammu and Kashmir has notified Rules for the codes while states of Uttar Pradesh, Bihar, Uttarakhand and Madhya Pradesh have put up draft Rules for two Codes while Karnataka has put it up for one Code.

Both the Centre and the states have to notify rules under the codes to bring them into force in their states as labour is a concurrent subject under the Constitution of India.

Once the wages code comes into force, there will be significant changes in the way basic pay and provident fund of employees are calculated.

Vice President and Business Head-Compliance and Payroll Outsourcing, TeamLease Services, Prashant Singh said, “Since the industry and employers were not clear about the notification and states were still to announce, now this would give some time for them to rework and remodel their CTC structure and help minimise the financial implications on both the employers and the employees," Money Control reported.

(With inputs from The Economic Times and Money Control.)

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