Overview of Industrial Relations Code, 2020
What is IR Code:
To consolidate and amend laws relating to Trade Unions, conditions of employment in Industrial Establishments or undertakings, Investigation and settlement of Industrial Disputes and connected matters.
Acts to be repealed: Trade Unions Act, Industrial Employment Standing Orders) Act, & the Industrial Disputes Act
Ministry looks to implement all 4 codes in one go
Object : to achieve Industrial peace & harmony, progress of industry and cordial relationship between the employer and the employees
Salient Provisions:
- Bipartite Forums:
- Constitution of Works Committee & Grievance Redressal Committee
- Registrar of Trade Unions, criteria, constitution and procedure
- Standing Orders:
- Applicability, Model Standing Orders, and procedure
- Notice of Change – Power to exempt..
- Voluntary reference of disputes to arbitration
- Mechanism for Resolution of Industrial disputes
- Strikes & Lock-outs, Lay-off, Retrenchment & Closure
- Worker Reskilling fund
- Prohibition of unfair labour practice
- Key Definitions
"employee” - … any person (other than apprentice) skilled, semi-skilled, unskilled, manual, operational, supervisory, managerial, administrative, technical or clerical work, for hire or reward, whether the terms of employment be express or implied..
“worker” – similar as above, and includes working journalists and sales promotion employees, but excludes, inter alia,
- any such person, who is employed mainly in a managerial or administrative, or in a supervisory capacity drawing wages not exceeding Rs.18,000 p.m. (or as may be notified by the Central Government, from time to time )
"Wages"
Covers all salary or allowances, or otherwise expressed in terms of money or capable of being so expressed
Does not cover : Bonus payable under any law, Conveyance Allowance
House Rent Allowance , Overtime Allowance
House accommodation, Supply of light, water, medical attendance
Other amenity/ services excluded by a general or special order
Commission, Contribution to Provident Fund
Any sum to defray special expenses, Gratuity
Retrenchment compensation
Remuneration under any award/ settlement
Proviso:
Covers all salary or allowances, or otherwise expressed in terms of money or capable of being so expressed
Does not cover : Bonus payable under any law, Conveyance Allowance
House Rent Allowance , Overtime Allowance
House accommodation, Supply of light, water, medical attendance
Other amenity/ services excluded by a general or special order
Commission, Contribution to Provident Fund
Any sum to defray special expenses, Gratuity
Retrenchment compensation
Remuneration under any award/ settlement
“employer” Definition of employer includes a contractor * impact discussed under “bi-partite forums”
“fixed term employment” engagement of a worker on the basis of a written contract of employment for a fixed period
“industry” any systematic activity carried on by cooperation between employer and worker .. For the production, supply or distribution of goods or services … (Similar to ID Act definition)
“Industrial establishment or undertaking” an establishment or undertaking in which any industry is carried on (wide enough to cover almost all establishments)
Bipartite Forums – Works Committee
Where 100 or more workers or employees (were employed during the preceding 12 months) the appropriate Government may by general or special order, require any industrial establishment to constitute a Works Committee of Rep’s of Employer/Workers
no. of workers’ representatives shall not be less than that of employers
Workers’ representatives shall be chosen as may be prescribed in consultation of the Trade Union, if any
Duty of Works Committee to promote measures of amity and good relations…
Grievance Redressal Committee
Every Industrial Establishment employing 20 or more workers shall have one or more Grievance Committee for resolution of disputes arising out of individual grievances
shall consist equal no. of employer’s and workers’ representatives, to be chosen in the manner as may be prescribed
Chair Person of the Committee, to be chosen from amongst the employers’ representatives & worker’s representatives, by rotation every year
Total nos. of Reps not to exceed 10, to comprise adequate women workers,.. In proportion to the total no. of women workers
Grievance Redressal & Dispute Process
Committee may dispose of any grievance (to be filed within one year from date of cause), within 30 days of receipt
Decision to be basis majority view, provided >1/2 of the workers’ Reps have agreed
If the grievance resolution is not satisfactory/unresolved, aggrieved worker may appeal to the conciliation officer, through Trade Union*
Any dispute arising out of any discharge, dismissal, or termination shall be deemed to be an industrial dispute
Trade Union – salient features
State Government may , by notification, appoint the Registrar/Additional Registrar, Joint Registrar & Deputy Registrar of Trade Union
Any 7 or more members of a TU by subscribing to the rules of the TU and/otherwise Complying to this Code may apply for registration
A registered Trade Union shall at all times continue to have not less than 10% of the workers, or 100, whichever is less, but a minimum seven members of the IE.
Negotiating Union, or Council – where only one TU registered, the Industrial establishment shall recognize such TU as the sole negotiating Union
If more than one TUs are registered, then the TU having 51% , or more workers on the muster roll of the IE , verified as prescribed, shall be recognized as the sole negotiating Union
In cases where more than one Trade Union and no such TU has 51% or more of workers, there shall be a negotiating council constituted by employer, consisting representatives of such unions, which have the support of not less than 20%
The recognition of the negotiating union/negotiating council shall be valid for 3 years from the date of such recognition or constitution or such further period of not exceeding 5 years, in total, basis mutual decision between the employer and the Trade Union
The Employer is obligated to provide such facilities to the negotiating union or negotiating counsel, as may be prescribed
Standing Orders
Hitherto, the Standing Orders were applicable to factories and as for Commercial Establishments / IT Industry, in Some States where specific amendments were made for applicability
The IR Code has mandated Standing Orders for every industrial establishment wherein 300 or more workers are employed, or were employed on any day preceding 12 months
As for service sector, the Government has notified the model Standing Order, which are covered under the OSHWC Code
Notably, this provides for the concept of “work from home”
Employer shall prepare draft standing orders, within 6 months from date of commencement of this Code (basis model standing order)covering maters specified in I schedule and any other matter, considering the nature of activity
The employer shall consult the Trade Unions, or recognized negotiating union, or the members of negotiating council, for the draft standing order and thereafter forward the draft, electronically or otherwise, to the certifying officer
For the period from which this Code is applicable and the date from which the standing order as finally certified come into operation, the model standing order provided under this code shall be deemed to adopted in that establishment and the relevant provisions shall apply to such model standing orders
The appropriate Government, may by notification, exempt conditionally or unconditionally exempt any industrial establishment or class of industrial establishment from the relevant provisions of this Code
Notice of Change
Notice of Change re: wages, leaves, holidays, reduction in no. etc., to be issued to workers concerned
Arbitration for disputes, if the agreement/settlement with workers provides for alternative reliefs
Mechanism for conciliation, settlements and appeals before Tribunals/National Industrial Tribunals
Prohibition of Strikes/Lock-outs
Strikes
No person employed in an IE shall go on strike, without giving the employer notice, within 60 days before striking; or within 14 days of giving such notice; or before expiry of date of strike specified, or during the pendency of any conciliation/tribunal/arbitration proceedings
Lockouts
No employer of an Industrial Establishment shall lock-out any of its workers without complying with the terms (similar time line as above)
Lay Off-Retrenchment & Closure
Does not apply to IEs with less than 50 workers or of a seasonal character or where work is performed intermittently
For these particular provisions, industrial establishment shall mean a factory or a mine or a plantation
Therefore, these provisions has limited application to a commercial establishment (refer next slide)
No worker who has been in continuous service for not less than 1 year shall be retrenched until –
Given one month’s written notice with reasons and the period has expired, or paid wages in lieu of such notice
Paid compensation @15 days for every completed year part thereof in excess of 6 months, at the time of retrenchment
Retrenchment – commercial establishments
Notice in prescribed form has been served on the appropriate authority as may be notified
@ additional 15 days wages to be remitted to the Workers’ Reskilling Fund
Workers’ Reskilling Fund
The appropriate Government shall, by notification set up a fund “worker reskilling fund”
The fund shall consist of (a) contribution of the employer, an amount equal to 15 days wages last drawn (or as may be notified) for workers who are retrenched
(b) any other contribution from such other sources as may be prescribed
The fund shall be utilised by crediting 15 days wages last drawn to the worker’s account within 4 days of such retrenchment
Please contact viswanathanvasudevan159@gmail.com, for any queries
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