Labour reforms abandoned, Centre to push pro-labour laws instead

  • HT Correspondent, Hindustan Times, New Delhi
  • Updated: Dec 20, 2015 00:13 IST
A labourer stacks bricks on his head at the construction site in Kolkata. The NDA government has decided to abandon its ambitious labour reforms in favour of pushing forward pro-labour legislation. (Reuters Photo)

The NDA government has decided to relegate its ambitious labour reforms to the back burner in this session, and push for pro-labour legislation instead.

The Lok Sabha will take up the Payment of Bonus (Amendment) Bill, which envisages extending bonus payments to more workers, next week. The bill seeks to raise the wage ceiling for procuring a bonus to Rs 21,000 per month from the existing Rs 10,000, and also increase the maximum amount of bonus under the legislation to Rs 7,500 from Rs 3,500.

Raising the wage and bonus calculation ceilings was one of the assurances given by the Centre to 10 central trade unions, after they went on a one-day strike on September 2 this year.

Due to its strong pro-labour credentials, ministry officials contend that the bonus amendment bill is the only one that can be pushed through in the current session of Parliament. It is, however, unlikely to be placed before the Rajya Sabha in the ongoing session.

Payment of bonus to industrial employees is mandatory under the Payment of Bonus Act, 1965. It stipulates that any employee earning up to Rs 10,000 per month has to be paid a bonus at a minimum rate of 8.33%. With the amendment to the Act, workers earning up to Rs 21,000 (basic plus DA) a month will be eligible for the bonus.

Sources said the government seems to have shelved plans to introduce other labour reform legislations, which the trade unions had vociferously opposed due to their alleged pro-industry nature. These included a new wage and industrial relations code, a child labour bill and a small factories act.

While the small factories bill proposes to keep units employing less than 40 workers out of the purview of 14 labour laws, including the Employees Provident Fund Act, the Employees State Insurance Act and the Industrial Dispute Act, the code on industrial relations will make it easier for companies to sack up to 300 employees without the government’s permission.

The child labour bill, on the other hand, proposes that children below fourteen years may only be allowed to work in enterprises owned by their own families.

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