Author: Krishnagopal Abhay, 2^nd year student at Campus Law Centre, University of Delhi

In this final of a 3-piece series, we will briefly examine the Code on Social Security, 2020. The previous pieces pertained to the OSHWC Code, 2020 and the IR Code, 2020. The Bill is drafted with the aim of amalgamating, simplifying and rationalizing the relevant portions of nine existing central labour laws pertaining to social security, including the Employees’ Provident Fund Act, 1952, the Maternity Benefit Act, 1961, and the Unorganised Workers’ Social Security Act, 2008. It has 164 sections and seven schedules.

The threshold of minimum workers required for the applicability of certain provisions are mentioned in the First Schedule of the Code. Second Schedule lists the persons who are to be regarded as ‘employees’ as per Section 2(26). Third Schedule lists all the ‘occupational diseases’ which are peculiar for the employment of an employee, as per Section 2(51). Fourth Schedule mentions the injuries deemed to result in ‘permanent total disablement’ and ‘permanent partial disablement’ as per Sections 2(56) and (57) respectively.

Chapter II provides for constitution of various Social Security Organizations, which are: A Board of Trustees of the Employees’ Provident Fund to be called ‘the Central Board’; The Employees’ State Insurance Corporation to be called ‘the Corporation’; a National Social Security Board and State Unorganized Workers’ Board; and the State Building Workers’ Welfare Board. They are subject to supersession by the appropriate Government in case of failure to discharge their duty diligently within the prescribed timeframe. The National Social Security Board may also act for the purpose of gig workers and platform workers.

Chapter III deals with Employees’ Provident Fund. The Central Government may constitute schemes such as EPF scheme, Employees’ Pension Scheme, Employees’ Deposit Linked Insurance Scheme, or any other scheme(s) to provide social security benefits to self-employed workers or any other class of persons. Fifth Schedule mentions the matters that may be provided for in the various schemes.

They may also constitute respective funds for the purposes of the aforementioned schemes, which are to be financed by various contributions of the employer and the employee.

Chapter IV deals with Employees State Insurance Company (ESIC) and Section 28 mandates that every employee to which the provision is applied shall be insured, subject to other provisions. Section 32 mentions several benefits which the insured persons are entitled to, such as periodical payments in certain situations, medical treatment, etc.  

Chapter V deals with provision regarding Gratuity such as its payment, determination of the amount, etc. Chapter VI deals with maternity benefits such as prohibition of employing or making a woman work during certain periods, payments and leaves regarding maternity, creche facilities, etc. Chapter VII deals with Employee’s compensation. Section 73 requires the employer, or on their behalf, to send a report to the competent authority in case of death or bodily injury of a worker within 7 days of the accident. Section 74 mandates the employer to pay compensation if an employee gets injured or gets any ‘occupational disease’ arising out of and in the course of employment. The exceptions are stated in the proviso therein. Sixth Schedule states the factors to be considered for working out lump sum equivalent of compensation amount in case of permanent disablement and death.

Chapter IX deals with Social Security for unorganized workers, gig workers and platform workers. It mandates the appropriate Government to regularly notify and formulate welfare schemes on certain matters for the aforementioned workers, who are required to be registered as well.

Section 122 provides for the appointment of Inspector-cum-Facilitators who shall discharge the duties as per the provisions of the Code. Section 123 states that the employers shall maintain records and registers in the form prescribed by the appropriate Government, containing particulars and details with regard to persons employed, muster roll, wages and other particulars and details as required.

Section 143 empowers the appropriate Government to grant exemptions to any particular establishment or class of establishments, or employees or class of employees, from any or all provisions of the Code.

The Hon’ble Minister claimed that 74% of the 233 recommendations made by the Standing Parliamentary Committee were accepted. Like all the reforms and pieces of legislations, these bills also were welcomed with both bouquets and brickbats. In the medley of praises, politics and genuine concerns, if there is one thing on which consensus can be reached, it would be the dire need to bring labour reforms. The archaic labour laws neither served the labours nor the employers. It is incontrovertible that the revamp was long due. Whether this is a watershed moment for labour and employment can only be answered with time. As the saying goes: “the proof of the pudding is in the eating”.