The central government has set a weekly working hour limit of 48 under the new labor codes, after which overtime will be paid double the amount. ...read more

Amid the ongoing debate on working hours, the central government has capped weekly working hours at 48 under the new labour codes, after which workers will be paid double their fixed hourly wage.

Nearly four months after draft rules under four new codes were published for stakeholder consultation, the Centre on Friday published final rules under two codes: wages and industrial relations. However, the old rules will remain in force until the final notification of the new rules for the other two codes.

Separately, states will have to notify their own rules, taking cues from those notified by the center. West Bengal was the only state so far that had not implemented it, but with the BJP's victory in the assembly elections, it too will notify rules in line with the center's.

From policy to implementation

Puneet Gupta, Partner, EY India, said the notification of the rules is an important step in moving the labour codes from policy to implementation.

However, it is equally important to recognise that these Central Rules will primarily apply to telecommunications, banking and insurance, mines, oil fields, major ports, air transport, as well as Central Public Sector Undertakings and contractor establishments where the Central Government deems fit.

Rules for wages, bonuses and allowances

The rules under the Code on Wages empower the central government to set minimum wages and national minimum wages, as well as determine their timely payment. Furthermore, these rules hold the principal employer, rather than the contractor, accountable for non-payment of bonuses to contract workers.

It further stated that the variable dearness allowance should be revised twice a year based on changes in the consumer price index for industrial workers. However, Puneet Gupta said the new rules lack clarity on the categories of workers who will be covered under the definition of overtime.

Establishment of National Reskilling Fund

Under Section 83 of the Industrial Relations Code, the government has also established a National Reskilling Fund. This will ensure that workers who lose their jobs due to layoffs are not only given lump sum severance pay but are also financially supported to learn new skills for re-employment.

This fund will be primarily financed by the employer, who will have to contribute 15 days' wages for each retrenched employee.

 PC:Jagran