Salient Features of The Code On Social Security, 2020

By - Rajeev Rambhatla on September 20, 2022

Labour laws (or employment laws) are those that mediate the relationship between workers, employing entities, trade unions, and the government. Collective labour laws relating to the tripartite relationship between the employee, employer, and union. Individual labour laws concern the employees' rights at work and also through the work contract. The Central Ministry has enacted forty central labour laws concerning various types of labour and fields.

As per the 6th Economic Census, the number of establishments in India is small in size. However, irrespective of the size of the establishment, the labour codes strengthen the protection available to workers, including unorganized workers (‘unorganized worker’ has been defined under the Unorganized Workers' Social Security Act, 2008, as a home-based worker, self-employed worker or a wage worker in the unorganized sector and includes a worker in the organized sector who is not covered by any of the Acts mentioned in Schedule-II of Act i.e. the Employee's Compensation Act, 1923 (3 of 1923), the Industrial Disputes Act, 1947 (14 of 1947), the Employees' State Insurance Act, 1948 (34 of 1948), the Employees Provident Funds and Miscellaneous Provision Act, 1952 (19 of 1952), the Maternity Benefit Act, 1961 (53 of 1961) and the Payment of Gratuity Act, 1972 (39 of 1972)) in terms of statutory minimum wage, social security and the healthcare of workers. The Code on Wages, 2020 has universalized statutory rights for minimum wages and the timely payment of wages to all workers to support sustainable growth and inclusive development. Besides, the Code on Social Security, 2020 (SS Code) aims to extend social security to all employees and workers in the organised and unorganised sectors.

The provisions introduced in the SS Code to enhance coverage of social security are as follows:

  • The coverage of Employees' State Insurance Corporation (ESIC) has been extended pan-India as against notified districts/areas.
  • ESIC coverage voluntarily for establishments having less than 10 employees has been introduced.
  • Further, benefits under ESIC can also be made applicable to an establishment which handles hazardous or life-threatening occupations as notified by the Central Government.
  • Envisages a Social Security Fund for formulating schemes for the welfare of the unorganized workers, gig workers and platform workers.
  • The gig worker and the platform worker have also been defined for the purpose of formulating schemes to provide social security benefits.

The Central Government has been empowered to extend benefits to unorganized workers, gig workers (a person who works temporary jobs, typically in the service sector as an independent contractor or freelancer)  and platform workers (a worker working for an organisation that provides specific services using an online platform directly for individuals or organisations) and the members of their families through ESIC or Employees’ Provident Fund Organization, which came into existence with the promulgation of the Employees' Provident Funds Ordinance on November 15th 1951. It was replaced by the Employees' Provident Funds Act, 1952. The Employees' Provident Funds Bill was introduced in the Parliament as Bill Number 15 of the year 1952 as a Bill to provide for the institution of provident funds for employees in factories and other establishments. The Act is now referred to as the Employees' Provident Funds & Miscellaneous Provisions Act, 1952 which extends to the whole of India. The Act and Schemes framed are administered by a tri-partite Board known as the Central Board of Trustees, Employees' Provident Fund which consists of representatives of the government (both central and state), employers, and employees.

-  Rajeev Rambhatla, Head-Hyderabad and A. Niharica, Intern


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