Implications Of The Industrial Relations Code, 2020

The Central Government amalgamated the existing labour laws, namely, the Trade Unions Act, 1926, the Industrial Employment (Standing Orders) Act, 1946 ("SO Act"), and the Industrial Disputes Act, 1947 ("ID Act"), under a new legislation enacted as 'the Industrial Relations Code, 2020' ("Code") on September 29, 2020. This Code will come into effect from a date to be notified by the Central Government.

Broadly speaking, the Code seeks to benefit both employers and their workers. It streamlines the dispute resolution mechanism, protects fixed-term workers, requires all large industrial establishments to implement standing orders, creates a re-skilling fund for retrenched workers, and enhances penalties to deter non-compliance. It adopts a business-friendly approach to promote industrial harmony through the prescription of a single negotiating body and greater flexibility to employers to take operational decisions.