Recent Labour Codes – Key Impact Areas

Employer

S V RAMACHANDRA RAO
Resource Inputs Pvt Limited (RIPL)
HR Chambers Outsourcing Pvt Ltd (HRC)
Direct Cost implications
 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

Wage Definition
Minimum Wage should not be bifurcated
Higher Salary employees (above double the minimum wage) allowances should not be more than
50% of the gross monthly remuneration.
COST GOES UP (INCREASE IN THE COST) COST COMES DOWN (REDUCED COST)
P F Contribution ESI contribution [ But more employees will be covered under
ESI
Gratuity Payment Maternity
Over Time Payment [ as present practice is on Basic + DA ] Retrenchment Compensation
Leave Encashment [ as the present practice is on Basic +DA]
Lay-off compensation
Bonus Payment

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 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 Contractor’s workmen should be paid minimum bonus of 8.33%

 Contractor workers who are regularly employed should be given annual increment of
minimum 2% on their gross wages every year.

 Inter-State migrant worker lump sum amount towards to and fro fare to native place once a
year.

 In case of death due to accident in addition to the compensation Rs. 25,000/- should be paid
towards funeral expenses. [ non ESI employees & Inter State Migrant workers ]

 Also transport charges from place of death to the native place.

 Employees 45 years and above annual medical examination every year before 30th April

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Indirect Cost implications
 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 250 or more workers welfare officer [ Factory }

 100 or more workers [including contract labour] canteen facility [ Factory ]

 50 or more workers separate rest rooms for male, female and transgender and lunch room
[Factory]

 When the incidence of sickness among IPs is excessive ESI corporation can claim payment
of extra expenditure incurred as Sickness Benefit.

 If the employer fails to Register or fails to pay contribution within the time and the
corporation pays any benefit to the employee, it can recover capitalised value from the
employer.

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 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 Annual leave eligibility – 180 days or more in a calendar year

 Unavailed annual leave can be encashed by the employee at the end of the calendar year

 Holidays / weekly off falling between the annual leave should be excluded.

 If the minimum rate of wages fixed for the day – if he is employed for a period less than the
normal working hours of the day, he will be entitled for a full normal working day wage.

 The period of work shall be inclusive of intervals of rest, shall not spread over for more than
12 hours.

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High Impact Issues
 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 Employer means a person who employs, whether directly or though any person, or on his
behalf or on behalf of any person….. [ Thus principal employer will become employer even
for contractor’s workman.

 Industrial Dispute includes Individual dispute

 Grievance Redressal Committee to be established for resolution of individual disputes.

 Failure of redressal leads to conciliation.

 Failure in conciliation leads to employee directly approaching the Tribunal

 Grievance Redressal Committee for contract labour – Principal Employer shall be the
Chairman
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 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 Where there is only one Registered Trade Union with 30 percent membership, the
employer shall recognize such union as sole negotiating union. 3 years period.

 An employee who retired or retrenched shall not be considered as outsider for the purpose
of holding office of a Trade Union.

 In multi union situation employer to constitute a negotiating council [ verification of

membership to be done by the employer ]

 Bonus Calculation - Trade Union or the employees, requiring any clarification relating to
any item in the balance sheet or the profit and loss account, then the authority by order,
direct the corporation or the company, to furnish to the Trade Union or the employees
such clarification and the the company, shall comply with such direction.

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 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 In the matters for negotiation by Trade Union these issues are also included
i. Orders passed by the employer under standing orders
ii. Promotion and transfer policy and disciplinary procedure
iii. Classification of grades and categories of workers
iv. Hours of work, number of working days in a week,
v. Leave with wages and holidays.

 The Industrial Tribunal may grant interim relief in cases relating to an industrial dispute
involving discharge or dismissal or otherwise termination, to the worker during the
pendency of the industrial dispute.

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 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 Employees form other states working directly on the rolls of the company with less than
Rs.18000/- monthly wage are also Inter-State Migrant workers.

 Wage Code, OHS Code and Social Security Code defined ‘Establishment’ as
A place where an industry, trade, business, manufacture or occupation is carried on in
which 10 or more workmen are employed.
I R Code defined Industrial Establishment.

 Thus every type of organization is covered under the definition and the code is applicable.

 Women employee has to give her consent to work after 7 PM and before 6 AM

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Other Impact Issues
 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 Accident Report to be sent to Labour Department in addition to Factories Department

 Details of accident and dangerous occurrences in the establishment for the last 5 years to be
displayed on the notice board.

 Sitting arrangements for all employees obliged to work in a standing position.

 Maintain register – work performed along with other details

 Appointment Order to contain LIN number, Date of Birth, Aadhar Number, Bank Account
Details, UAN, ESI Number, Nature of duties etc.,

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 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 Government to declare additional minimum wage for certain category of workers taking into
account nature and conditions of work.

 Undisbursed wage and bonus to be deposited with the Labour commissioner

In case of death : on expiry of 3 months
In other cases : 6 months.
 Where the employee has been removed or dismissed or retrenched or resigned Wages
payable to him shall be paid within two working days. [ not full and final settlement it is
wages only]

 Deductions for absence of the employee from place or places of work shall not be for larger
proportion than the period for which he was absent.

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 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 When there is a dispute on the Bonus Percentage, minimum bonus should be paid pending
the dispute for higher bonus.

 No employer shall make any discrimination on the ground of sex while recruiting any
employee for the same work or work of similar nature, except where employment of women
in such work is prohibited or restricted

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Other Impact Issues – WIN-WIN
 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

Fixed Term Employment

 Hours of work, wages, allowances and other benefits shall not be less than that of a
permanent worker doing same work or work of similar nature.

Same work or work of similar nature

 Means in respect of which the skill, effort, experience and responsibility required are the
same, when performed under similar working conditions

For the purpose of equal wages ‘wage’ shall mean

Basic Pay - Dearness Allowance - Retaining allowance if any
Conveyance allowance - House rent allowance
Remuneration payable under settlement or award - Over time allowance
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 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 The concept of Public Utility Service has been dropped and 14 days notice is mandatory for Strike or
Lockout in all industrial establishments.

 Conciliation officer should not hold preceding relating to a dispute after 2 years from the date on
which such dispute arose.

 On failure of conciliation proceedings either party can go directly to Industrial Tribunal ( no

government intervention )

 An employee shall be disqualified from receiving bonus , if he is dismissed for

- Fraud or Riotous or violent behavior or
- Theft, misappropriation or sabotage of property of the establishment or
- Conviction for sexual harassment.

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 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 Lay-off, Retrenchment and Closure

Industrial establishments employing less than 300 workers are not required to take
permission from the Government.

 Standing Orders will be applicable to Industrial Establishments employing 300 or more

workers.

 Common Creche facility is permitted

 125 hours Over Time work is allowed in a quarter.

 Factory under construction is excluded from the Building and Other construction works and
hence no cess is payable.
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Other Impact Issues – Contract Labour
 HR Chambers Outsourcing Pvt Limited
Labour Codes – Key Impact Areas SV Ramachandra Rao – 9849948654
e mail: [email protected]

 The Occupier or the Factory Manager of a Factory shall only be called as Principal
Employer.
 Contract Labour Chapter is applicable to the Principal Employer only if 50 or more
contract labour are employed
 Manpower supply contractor employing 50 or more contract labour is covered under
this chapter.
 Manpower contractor employing below 50 shall submit half-yearly return.

 Contractor supplying manpower more than one state may obtain license on Shram
Suvidha Portal – valid for 5 years.

 Contractor to provide Bank Guarantee or Deposit @ Rs. 1000/- per person.

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 HR Chambers Outsourcing Pvt Ltd
The Leadership SV Ramachandra Rao
S.V. Ramachandra Rao, Promoter & Managing Director
Backed with 49 years of experience in the field of Human Resource Management, Labour Law
and Industrial Relations is providing leadership to the companies promoted by him for the last
over 22 years.

He had his post graduate degree in Social Work with Personnel Management and Industrial
Relations Specialization, Degree in Law from Berhempur University and Post Graduate
Diploma in Labour and Administrative Laws from Annamalai University and worked with
highly reputed Manufacturing and Service Sector organizations for over 27 years in senior
management positions in the field of HR, legal and general management.

Currently he is Telangana State Council Member of Confederation of Indian Industry (CII),

Vice-Chairman Employers Federation of Southern India AP & TS Branch, Member Employee
Provident Fund Regional Board and consultant to many reputed companies.
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 HR Chambers Outsourcing Pvt Limited
Our Services SV Ramachandra Rao
[email protected]
We provide customized, creative and effective strategic HR solutions. Following are
some of the services that we render to our clients as their associate,
• Outsourcing Solutions
• Manpower Outsourcing
• Payroll Processing
• Labour Laws and Employee Relations
• Compliance
• Audit
• Strategic Support for productive employee relations
Placement and Executive Search
• Human Resource Consulting

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Some of our Partners of our progress
 4 Labour Codes – Key issues HR Chambers Outsourcing Pvt Ltd
SV Ramachandra Rao

THANK YOU
SV RAMACHANDRA RAO
E mail : [email protected]
9849948654
https://www.linkedin.com/in/s-v-
ramachandra-rao-73a035194/

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