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Labour ministry proposes revised social security code

Labour ministry has circulated the draft code seeking comments from stakeholders by October 25 following which tripartite consultations will be held to finalise the code.

, ET Bureau|
Sep 18, 2019, 02.35 PM IST
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The idea is to provide a comprehensive social security system to that will cater to the retirement, health, old-age, disability, unemployment and maternity related needs of 50 crore workers in the country.
Continuing with its top agenda of labour reforms, labour ministry has proposed a revised social security code that aims to merge, simplifying and rationalizing the relevant provisions of the existing eight central labour laws by setting up of a social security board in the country. The Employees’ Provident Fund Organisation and the Employees’ State Insurance Corporation would be part of the code but the two schemes will continue to operate.

However, dedicated funds will be created for PF, pension and insurance “that shall vest in, and be administered by, the central board in such manner as may be specified in the respective schemes,” the draft social security code said.

Labour ministry has circulated the draft code seeking comments from stakeholders by October 25 following which tripartite consultations will be held to finalise the code. This comes a day after labour minister Santosh Kumar Gangwar said that his ministry will soon reach out to public for opinion in the draft code.

As per the draft, beneficiaries will continue to enjoy benefits of provident fund, pension and insurance under EPFO and the medical benefits under ESIC. “However, the code has introduced the option for subscribers to switch to the National Pension Scheme, a proposal which had faced flak from all quarters three years ago.

“The chief executive officer of the Board or any other officer authorised by him in this behalf may, upon receipt of an application allow any employee or a class of employees to exercise the option to join the National Pension System,” the draft said, adding that an employee, his first job, can also opt for NPS without making application under the Code.

Out of the four labour codes proposed to amalgamate 44 labour laws, the ministry has already got the labour code on wages passed by the Parliament while it has tabled the labour code on occupational safety in the Lok Sabha.

The idea is to provide a comprehensive social security system to that will cater to the retirement, health, old-age, disability, unemployment and maternity related needs of 50 crore workers in the country.

The proposal to opt for NPS may face stiff resistance from trade unions. Vrijesy Upadhyaya of BMS has reiterated that the RSS-affiliate trade union will resist any such proposal as the two schemes are not at par. “Giving workers the option to switch to NPS will not be in the interest of the workers,” he had said earlier.
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