Draft Social Security Code
Amid drawbacks and shortcomings in the Unorganized Workers’ Social Security Act, 2008 the government of India has planned and proposed the Draft Labour Code on Social Security and Welfare which was published and put in April 2017 in the public domain for comments .
Key features
The code is a serious attempt by addressing the concerns of the labour force and thus seeks to conceive a universal social security cover in a ‘Single Code’ by merging all existing schemes and laws. The ambitious Draft Labour Code addresses the long pending issues about security and well being of the labour force of India ; it is such a big initiative that the government proposes to cover the provisions of as many as fifteen labour laws, which have been in place for the last few years. The vision is to amalgamate the provisions of these laws so as to give rise to single framework to universally solve all the problems and issues being faced by the workers of all strata and categories in the country. The draft code has the clear cut objective of merging the provisions of existing laws including the Employees Compensation Act; the Maternity Benefits Act; the Payment of Gratuity Act; the Unorganized Workers Social Security Act; the Building and Other Construction Workers Welfare Cess Act; the Beedi Workers Welfare Cess Act; the Beedi Workers Welfare Fund Act; the Iron Ore Mines, Manganese Ore Mines and Chrome Ore Mines Labour Welfare Cess Act; the Iron Ore Mines, Manganese Ore Mines and Chrome Ore Mines Welfare Fund Act; Employees State Insurance Act; the Employees Fund and Miscellaneous Provisions Act; the Mica Mines Labour Welfare Cess Act; the Limestone and Dolomite Mines Labour Welfare Fund Act, the Cine Workers Welfare Cess Act and the Cine Workers Welfare Fund Act.
Questions & Answers
How is the labour code proposed to be enforced? Which are the categories of workers does this broad based law aim to bring into its scope and ambit?
There are several laws passed by the parliament for providing social security including maternity benefit, accident and disablement compensation, provident fund and gratuity. However, these laws at best cover just 8 per cent of the workforce in the country. Thus there was a need to further augment the social security cover for works so that any possibility of the risk or danger of work force being left in the lurch in future is preempted. With the labour force getting restive about their rights and future needs, the government does not want to leave anything to chance while finalizing the draft so the code targets the inclusion of the workers in both formal and informal sector and seeks to bring even casual workers, piece rate workers, fixed term workers, outworkers, self- employed workers, home based workers and domestic workers under its umbrella cove of social security. However the task seems to be easier said than done because the mammoth exercise demands that fresh social security schemes are framed and implemented. The government if it really wants to realize the spirit of its goals it needs to put social security tools like a pension scheme, provident fund scheme, maternity benefit scheme, sickness, disablement, invalidity and medical benefit schemes and an unemployment benefit schemes in place. Notwithstanding the efforts of the central government from the top the states are also required to do their bit in making the ambitious social security plan a grand success and hence supplementary schemes at the provincial level will also have to be implemented by the states administration so that loopholes if any left out in the net are firmly plugged.
How will the proposed Social Security Code, once come into effect , facilitate the benefits to the workers as stipulated in the draft and thus have the potential of becoming vehicle of social and economic justice?
Under the provisions of the social security code the workers are, first of all, required to get registered with the State Board for Social Security on the basis of an Aadhaar linked identity number following which the workers would be provided the Vishwakarma Karmik Suraksha Khata (VIKAS) or say a portable Social Security account. It is this account that will give a credible identity to each and every worker eligible for the benefits as laid down under the code. it may be mentioned here that since the exercise of creating new scheme funds as envisioned under the codes is gigantic a number of legal bodies namely National Social Security Council headed by the Prime Minister of India, a Central Board of Social Security, and State Boards of Social Security are proposed to be established to speed up the processes of registration of workers, receipt of contributions, management of funds and payment of benefits. It is heartening to note that The Code reduces the payroll tax to 17.5 per cent and subsidizes the gratuity cost to 2 per cent (employers put it at 4-5 per cent) of total salary cost.
What are the major concerns of the trade unions and other stakeholders regarding the draft code?
Notwithstanding the draft code being received across the country as welcome initiative by cross section of society as it encompasses the broad range of categories of workers while defining its ambit and scope there are areas in the draft which leaves much to be desired ; for instance , it defines “woman” as an “employee who is a woman in the context of maternity benefit under this code”; and as such “monthly income” has not been defined. Furthermore the code inadvertently legalises “oral contract” by defining it as an attribute of informal worker. The words ‘oral contract’ crates concern in the minds of any sensible and thinking labour even working as informal or unorganized worker. The objection is being raised on the drafting of the language in the preamble to the code only which defines the broad contours by stating that it seeks to “Simplify, rationalize, consolidate, and amend the laws relating to social security of workforce so as to make them less complex for easier comprehension, implementation and enforcement” and thus the more “substantive” aspects requiring elaborate definition and interpretation is grievously mission which should generally be the case for any law. Since the ambit and scope of the new law is vast it remains doubtful as to whether the states will be able to fully implement it as tax collection required to sustain a huge administrative architecture, which includes the National Council, the Central Board, the State Board, an Executive Committee, a Standing Committee, and Central and State Advisory Committees to run the scheme will be the biggest challenge. The huge bodies do not give adequate representation to trade unions. In nutshell the greatest flaw in all this exercise is its top-down approach which is highly cumbersome and hence cast serious doubts on the prospective success and benefits for which it is meant.
