The Economic Advisory Council to the PM (EAC-PM) has subsidized a unified labour code, almost on the lines of the Bangladesh Labour Act of 2006, stating that the labour reforms undertaken in form of 4 Codes didn’t take a comprehensive sight of all labour laws and only had standardised and streamlined the already statutes without addressing definitional inconsistencies.
The EAC-PM has asked for further making the labour laws simple and asked for other alternative policy efforts to increase employment generation and growth in the industrial sector.
The union labour ministry had merged 29 central labour laws into 4 Codes. These are the Code on Wages, 2019, the Code on Social Security, 2020, the Industrial Relations Code, 2020 and the Occupational Safety, Health and Working Conditions Code, 2020. These are to be notified yet.
“A ‘single unified labour law’ or reforms aimed at all sectors and nature of jobs would create a supportive business environment for the urban economy. This would allow the service sector and the new-age urban economy to truly take off,” the EAC-PM stated in its report on state-level labour reforms in India which was earlier submitted to the Prime Minister’s Office.
In that direction wider consultations with all the stakeholders may also be sought, it further added.
The report that was prepared at the request of the PMO to check the effect of state-level labour law reforms on employment and economic growth, has now called for an urgent need to focus on urban areas, considering their significance from a national income and even overall standpoint of employment
“The report comes out at a crucial time as the nation is coping with the Covid crisis and boosting employment has become more vital than ever before,” Bibek Debroy who is the chairman of the EAC-PM, had stated in the report
The EAC-PM is of the idea that labour law reforms, even though significant, are not a magic bullet to increase employment generation, states the high degree of informality or even increase industrial growth, and has inquired a need for spending political capital on few labour law reforms, which are not enough for generation of employment.