Cabinet approves the Industrial Relations Code Bill, 2019

News: The Union Cabinet has approved the Industrial Relations Code Bill, 2019



  • Industrial Relations Code Bill, 2019 has been prepared by combining and simplifying relevant provisions of three Central Labour Acts viz. Trade Unions Act, 1926, the Industrial Employment (Standing Orders) Act, 1946, and the Industrial Disputes Act, 1947.

Key Provisions of the Bill:

  • Two-member Tribunal: The bill provides for setting up of a two-member tribunal (in place of one member). This would enable adjudicating important cases jointly and the rest by a single-member thus resulting in speedier disposal of cases.
  •  Empowering government officers for adjudication of disputes: The bill provides for vesting of powers with the government officers for adjudication of disputes involving penalty as fines thereby lessening the burden on the tribunal.
  • Flexibility to the exit provisions relating to retrenchment and others: Employee threshold for seeking government approval for retrenchment, etc. has been retained at 100. However, the bill has added a provision for changing ‘such number of employees’ through notification (through executive order).
  •  Re-skilling fund: The bill has said that re-skilling fund is to be utilised for crediting to workers in a manner to be prescribed.
  •  Fixed Term Employment: Bill has proposed giving a legal framework for fixed-term employment through which contract workers serving a fixed-tenure will get equal statutory social security benefits as regular workers in the same unit. Fixed-term employment would not lead to any notice period and payment of compensation on retrenchment excluded.

Additional Information:

  • Labour is a subject in the concurrent list of the Constitution of India. Thus,both the centre and states can enact laws on labour matters.There are 44 central laws and more than 150 state laws on labour.
  • Industrial Relations Code Bill, 2019 is the third code under labour reforms. The government has decided to codify 44 central labour laws into four broad codes:(a) wages (b) social security (c)industrial safety and welfare and (d) industrial relations.

Code on Wages Bill, 2019: 

  • It has already been approved by the Parliament. The bill provides that the Central Government will fix minimum wages for certain sectors including railways and mines while the states would be free to set minimum wages for other category of employment.
  • The code also provides for setting up of a national minimum wage.

Occupational Safety Health and Working Conditions Code, 2019: 

  • The Code repeals and replaces 13 labour laws relating to safety, health and working conditions.
  • It entails duties for employers which include a) providing a workplace that is free from hazards that may cause injury or diseases, and b) providing free annual health examinations to employees, as prescribed.

Draft social security code, 2019: 

  • It proposes to amalgamate legislations pertaining to provident fund, pension, medical insurance, maternity benefits, gratuity and compensation. 
  • It has proposed that the Central Government shall formulate and notify social security schemes for unorganised workers. 
  • It also proposes the Corporatization of Employment provident fund organisation(EPFO) and Employees State Insurance Corporation (ESIC).