Govt. to overhaul contract labour system, allow liberal hiring of workers

Contract workers are outside the purview of retrenchment or layoff and trade union laws, making such arrangements attractive to businesses.

The Code on Occupational Safety, Health (OSH) and Working Conditions Bill, 2020, facilitates hiring contract workers across the board for companies

Highlights of the Bill

• The Code seeks to regulate health and safety conditions of workers in establishments with 10 or more workers, and in all mines and docks.

• It subsumes and replaces 13 labour laws relating to safety, health and working conditions. These laws include: Factories Act, 1948; Mines Act, 1952; Dock Workers Act, 1986; Contract Labour Act, 1970; and Inter-State Migrant Workers Act, 1979.

• Establishments covered by the Code are required to register with registering officers, appointed by the central or state governments.

• Welfare facilities, working conditions and work hours for different types of establishments and workers will be prescribed by the central or state governments through rules.

• The Code sets up occupational safety boards at the national and state level to advise the central and state governments on the standards, rules, and regulations to be framed under the Code.

• The Code creates special provisions for certain classes of establishments such as factories, mines, dock workers, and constructions workers. These include separate provisions on licenses, safety regulations, and duties of employers.

Key Issues and Analysis

• The Second National Commission on Labour (2002) had recommended consolidation and simplification of existing health and safety laws. However, the Code continues to retain special provisions for various categories of workers such as working journalists and sales promotion employees. The rationale for retaining such provisions is unclear.

• The Code covers workers employed in establishments with at least 10 workers or more. It has been argued that size-based thresholds for applicability of labour laws helps in reducing compliance burden for small establishments. On the other hand, it has been argued that occupational health and safety laws should cover all workers, to protect their basic rights.

• The Code bars civil courts from hearing matters under the Code. Therefore, the only judicial recourse for a person aggrieved under the Code is to file a writ petition before the relevant High Court. It can be argued that a bar on civil courts from hearing any matters under the Code may result in the denial of an opportunity to challenge issues before a lower court.