The Government of India recently passed four labour codes and consolidated numerous central labour laws with an objective to simplify and modernise Labour regulations. These codes regulate (i) Wages (ii) Social Security (iii) Occupational Safety, Health and Working Conditions and (iv) Industrial Relations.
The changes are expected to give a major boost to labour reforms and impact many organisations in every sector. It is the objective of the Government that the new laws would reduce complexities, improve ease of compliance, usher in more transparency and accountability and help both employers and workers. However, the actual impact will need to be seen once implemented. The new codes are expected to enhance compliances significantly especially due to increased penal liabilities. This also creates anxiety and curiosity in organisations on this topic as many provisions may increase the employee costs and compliance costs.
Partner and Head – Global Mobility Services, Tax, KPMG in India