50% companies prepared to implement new labour codes

The new labour codes introduced by the Indian government over the past year are significant steps towards the much-needed labour reforms in the country. The four new labour codes, i.e. Code on Wages, Code on Social Security, The Occupational Safety, Health and Working Conditions Code (OSHWC) and The Industrial Relations Code are expected to bring in much awaited labour reforms in the country.

These codes subsume 29 existing legislation and intend to amalgamate, simplify and rationalise the relevant provisions of the subsumed laws.

Against this backdrop, Grant Thornton Bharat and Confederation of Indian Industry (CII) did a survey on the industry expectations on the new labour codes. The survey tapped into a pool of 4000+ respondents including C-Suite executives and middle to senior managers.

Key highlights from the survey

• With the objective of effective implementation, 43% organisations have started internal reviews. 13% are waiting for the final announcement on implementation date. While 20% firms have onboarded external consultants for better preparedness, 20% have not decided their implementation strategies yet.
• 85% respondents agreed that a minimum transition period of up to 6 months be allowed to implement various obligations and compliances applicable under new labour codes
• While 54% think the new labour codes will achieve the objective of widening social security coverage to the unorganised sector, 29% disagree
• Nearly 55% respondents support the view that people with fixed minimum wage rate should be entitled to overtime payment; 29% say this entitlement should be reserved for people in non-managerial roles
• 66% respondents voted in favour of providing organisations the flexibility to hire contractual employees for their core activities; 7% not sure about the benefits
• 54% welcome the positive impact of new labour codes in reducing time compliance burden on employers over a period of time

The survey was released at a webinar organised by the CII and Grant Thornton Bharat. Click here to watch the webinar recording | Password: Pi7GGe3B