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Code On Social Security 2020

The document provides an overview of the Code on Social Security, 2020 introduced in the Lok Sabha on September 19, 2020. The key points are: 1) The Code amalgamates and rationalizes provisions of nine central labour laws related to social security. 2) It universalizes social security coverage for unorganized sector workers, gig workers, platform workers and extends coverage to agricultural workers for the first time. 3) The time limit for receiving gratuity payment is reduced from 5 years to 1 year for all employees. 4) Definitions of key terms are expanded and changes are introduced around electronic filings and increased penalties for non-compliance.

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AkhilaSridhar 21
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70 views

Code On Social Security 2020

The document provides an overview of the Code on Social Security, 2020 introduced in the Lok Sabha on September 19, 2020. The key points are: 1) The Code amalgamates and rationalizes provisions of nine central labour laws related to social security. 2) It universalizes social security coverage for unorganized sector workers, gig workers, platform workers and extends coverage to agricultural workers for the first time. 3) The time limit for receiving gratuity payment is reduced from 5 years to 1 year for all employees. 4) Definitions of key terms are expanded and changes are introduced around electronic filings and increased penalties for non-compliance.

Uploaded by

AkhilaSridhar 21
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Introduction--An overview of the background

● Labour falls under the Concurrent List of the Constitution. Therefore, both Parliament and state
legislatures can make laws regulating labour.
● Central Government stated that there are over 100 state and 40 central laws regulating various
aspects of labour such as resolution of industrial disputes, working conditions, social security and
wages.
● The Second National Commission on Labour (2002) found existing laws to be complex, with
archaic provisions and inconsistent definitions.
● To improve ease of compliance and ensure uniformity in labour laws, the Central Government
recommended the consolidation of central labour laws into broader groups such as: (i) industrial
relations, (ii) wages, (iii) social security, (iv) safety, and (v) welfare and working conditions.
● In 2019, the Ministry of Labour and Employment introduced 4 Bills to consolidate 29 central
laws. These Codes regulate: (i) Wages, (ii) Industrial Relations, (iii) Social Security, and (iv)
Occupational Safety, Health and Working Conditions.
● While the Code on Wages, 2019 was passed by Parliament, Bills on the other three areas were
referred to the Standing Committee on Labour. The Standing Committee has submitted its report
on all three Bills. The government replaced these Bills with new ones on September 19, 2020.
The Code On Social Security, 2020 was introduced in the Lok Sabha on 19th
September 2020
Code on Social Security Bill, 2020

●This will replace nine social security laws, including Maternity Benefit Act, Employees’ Provident

Fund Act, Employees’ Pension Scheme, Employees’ Compensation Act, among others.

●The code universalizes social security coverage to those working in the unorganised sector, such

as migrant workers, gig workers and platform workers.

●For the first time, provisions of social security will also be extended to agricultural workers also.

●The code also reduces the time limit for receiving gratuity payment from the continuous service of

five years to one year for all kinds of employees, including fixed-term employees, contract labour,

daily and monthly wage workers.


The Code on Social Security, 2020 amalgamates and rationalizes the provisions of the following nine Central
labour laws:-

1. The Employees’ Compensation Act, 1923

2. The Employees’ State Insurance Act, 1948

3. The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952

4. The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959

5. The Maternity Benefit Act, 1961

6. The Payment of Gratuity Act, 1972

7. The Cine Workers Welfare Fund Act, 1961

8. The Building and Other Construction Workers Welfare Cess Act, 1996

9. The Unorganized Workers’ Social Security Act, 2008


CHANGE IN DEFINITIONS
(i) expanding the definition of ‘employees’ to include workers employed through
contractors
(ii) expanding the definition of “inter-state migrant workers” to include self-
employed workers from another state,
(iii) expanding the definition of “platform worker” to additional categories of
services or activities as may be notified by the government,
(iv) expanding the definition of audio-visual productions to include films, web-based
serials, talk shows, reality shows and sports shows, and
(v)exempting construction works from the ambit of “building or other construction
work” if the total cost of construction work exceeds Rs 50 lakhs (and if they employ
more than a certain notified number of workers).
● Change in definition of 'wages' , a uniform definition of wages without any separate
definition being provided was introduced for the purpose of computing Indian social
security / provident fund (PF) contributions. This will avoid the ambiguity
surrounding which part of wages/salary to be considered for PF contributions
especially for expatriate employees.
N
E
W
C
O
D
E

PREVIOUS CODE
Change in Term of eligibility for gratuity

Under the 2019 Bill, gratuity was payable on the termination of


employment, if the employee has been in the organisation for at
least five years. The 2020 Bill reduces the gratuity period from
five years to three years for working journalists.
social security funds for unorganised workers, gig workers and
platform workers

● The 2020 Bill states that the central government will set up such a
fund. Further, state governments will also set up and administer
separate social security funds for unorganised workers.

● The 2020 Bill also makes provisions for registration of all three
categories of workers - unorganised workers, gig workers and
platform workers.
Electronic filings

● The SS Code provides that procedures and filings can be made electronically.

● The old Acts did not have specific provisions for electronic filing.
Increase in Penalties
● Penalties have been substantially increased under the SS Code.
E.g., under the MB Act, if the employer fails to provide any maternity benefit to
which a woman is entitled, the employer is punishable with a fine upto Rs.
5000/- or imprisonment upto 1 year.
● Under the SS Code, the punishment for the same offence is imprisonment
for a term which may extend to 6 months or with a fine which may extend to
Rs. 50,000, or with both. Compounding of penalties is now possible for
first-time offences, subject to conditions. Employers will be given an
opportunity to correct non-compliance within a specified time period for any
offence under the SS Code prior to initiation of prosecution or proceedings.
THANK YOU

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