Despite Being A Good Start, The Code On Social Security Needs To Cover More Ground'..

• Published date: 08 June 2021
• Subject Matter: Employment and HR, Retirement, Superannuation & Pensions, Employee Benefits & Compensation
• Law Firm: Dua Associates
• Author: Mr Iqbal Tahir

The recent approval of the Code on Social Security, 2020 (CoSS) is part of the government's efforts to streamline India's labour laws by replacing multiple, and often outdated, regulations with a relatively more simplified set of rules. With the enactment of the CoSS, the government has set the ball rolling to extend universal social security to employees and workers in the organized, unorganized and other sectors. The CoSS, which was first introduced in the Lok Sabha in 2019, was subsequently referred to the Standing Committee on Labour for review. The Committee made 233 recommendations, of which 174 were included in the 2020 Code.

Among the most notable provisions of the CoSS is the expansion of social security coverage to include gig workers, platform workers, unorganized workers and fixed-term employees. The extension of welfare benefits to gig/platform workers is an important move considering that so far, they have not been covered under any legislation since their relationship with aggregators is not that of a typical employer-employee one. Aggregators will need to contribute 1%-2% of their annual turnover to a Gig and Platform Workers' Social Security Fund. The total contribution will be capped at 5% of the amount payable by aggregators to gig/platform workers.

The CoSS subsumes nine labour laws related to social security and welfare:

The code proposes the constitution of various social security organizations, including:

• Board of Trustees of Employees' Provident Fund (EPF): To administer schemes related to EPF, EPS (Employees' Pension Scheme) and EDLI (Employees' Deposit Linked Insurance)
• Employees' State Insurance (ESI) Corporation: To administer ESI schemes
• National Social Security Board and State Unorganised Workers' Board: To administer schemes related to unorganized workers
• State Building Workers Welfare Boards: To administer schemes covering building workers

Much like the other labour laws - the Occupational Safety, Health and Working Conditions (OSHWC) Code and the Industrial Relations (IR) Code - which were enacted recently, the CoSS suffers from a high level of ambiguity. The wordings of many provisions, as well as their process of implementation, are open-ended.

It is not wrong to expect that a new labour law, enacted after much deliberation, will lay down specific provisions with regard to a critical aspect - workers' welfare and social security. Unfortunately, the CoSS falls short in many places. In the case of unorganized workers...