Five years on, 4 labour codes come into effect

Rules expected in a week: Official

- KULDEEP SINGH

MORE THAN FIVE years after Parliament passed four labour codes, the Centre on Friday formally brought them into effect, marking a watershed moment in India’s labour governance. The move aims to modernise working conditions, strengthen wage protection, improve productivity, and accelerate job creation - key prerequisites for sustaining high economic growth over long periods.

For decades, India’s labour regime had been criticised for being rigid, complicated and outdated. Investors and businesses routinely pointed out that the complex tangle of laws discouraged expansion and hiring, restricting job creation in a country where millions enter the workforce each year.

To streamline this framework, the government consolidated 29 labour laws into four comprehensive codes between August 2019 and September 2020, aimed at improving the ease of doing business and attracting investment.

THE FOUR LABOUR codes will go a long distance towards universalising minimum wages and social security for all workers and accelerating formal job creation, experts said, reports Surya Sarathi Ray. The codes, they said, will also significantly ease the compliance burden and the retrenchment process. "It is a major reform that will would depend on how these codes are enforced. "Now, the executive has the power to notify many provisions of the codes... To what extent investment and decent jobs are created remains to be seen," said Partha Pratim Mitra, former principal labour and employment advisor, the Union ministry of labour.

A GOVERNMENT OFFICIAL said the rules will be issued in 5-7 days, after which they will also be enforced immediately.

“Rules will keep coming. But all the sections that do not require rules will be implemented immediately,’ the official said.