From landmark judicial pronouncements to progress in statutory reforms, 2019 was an interesting year in the domain of employment laws in India. This update summarises some of the key developments in 2019 and gives a brief overview of what can be expected in 2020.
THE YEAR THAT WAS
The past year witnessed both the Central government and State governments undertaking various initiatives in the labour and employment sector, including the introduction of legislative changes and measures to simplify and boost legal compliance.
In recent years, the Labour Ministry's efforts have concentrated around streamlining the vast number of central labour laws into 4 codes. The earlier endeavors of the Central government were directed towards formulating the draft-codes and obtaining stakeholder comments. In 2019, these efforts further crystallised into bills that were introduced in the Parliament. The Code on Wages, 2019 (Wage Code) was passed by both the Houses of the Parliament and has received Presidential assent.
The judiciary also delivered some note-worthy judgments on labour law in early 2019. Significant amongst them is the Supreme Court's (SC) decision that brought more clarity on the definition of 'basic wages' under the provident fund (PF) laws, and the Karnataka High Court quashing the obligation on employers to pay a 'service seniority allowance' under various minimum wages notifications issued in that State.
2019 also witnessed some interesting changes in the legislative space, prompted by the government's objective of enhancing 'ease of doing business' in India. Some of the noteworthy changes on this front include: (i) the introduction of a new shops and commercial establishments (S&E) law in Gujarat, (ii) renewal of exemptions given to IT/ITeS companies (and other types of establishments) from the applicability of certain provisions of the Telangana S&E Act and from the applicability of the Industrial Employment (Standing Orders) Act, 1946 (SO Act) in Karnataka, (iii) elimination of the registration-renewal requirements under the S&E laws in some States, (iv) permission given to factories in Karnataka to employ women at night (subject to conditions), (v) amendment to the applicability of the law on engaging apprentices, and (vi) coverage of the S&Es in Haryana under the SO Act.
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