Labour ministry to rejig draft social security code

NEW DELHI: The labour ministry will rework the draft social security code again, after the Prime Minister’s Office (PMO) pulled it up over the proposals that did not meet the objective of unifying all social security benefits under an umbrella scheme, a government official said.The ministry’s third draft does not align with the government's intent to move towards universal social security, the official said.The PMO is unhappy as the concept of “universal” was missing in the draft code, the official told ET. “The labour ministry has formed a committee to rework the code following a directive from the PMO.”The third draft presented by the Santosh Kumar Gangwar-led labour ministry has proposed that the Employee Provident Fund Organisation (EPFO) and Employee State Insurance Corporation (ESIC) be subsumed under a central body with a corporate-like structure.Though it proposed to extend the coverage of provident fund and ESI to temporary workers, it did not outline a comprehensive scheme that would provide social security cover to all.The draft has merely proposed to amalgamate legislations pertaining to provident fund, pension, medical insurance, maternity benefits, gratuity and compensation.Besides, there is no uniform definition of social security or any move to create a central fund for it.71432706 The existing corpus is proposed to be split into numerous small funds, which could lead to multiplicity of authorities as also confusion, the official said.Under the proposals, there will be no commitment on the government’s part of contribution.The ministry's labour code on wages has already been passed by Parliament.It has also moved the code on occupational safety for consideration and passage.The draft code on social security hasn’t gone down well within retirement fund bodies EPFO and ESIC as well, as they face the threat of losing control over the corpus and the management of the funds under the proposed code.“The proposed code is very confusing and does not abide by the concept of convergence of existing laws. Instead, the existing 6-8 social security benefits continue to be listed as separate chapters with no unifying scheme to link them all,” a senior official at the EPFO said, requesting not to be identified.Trade unions including RSS-affiliated Bharatiya Mazdoor Sangh (BMS) are firming up their views on the code, with the BMS saying that the current draft showed an “outdated approach” of the labour ministry and lack of connect with the ground reality of the economy.“The government has to be clear about the concept of social security. It is most needed for people who are without jobs and unfortunately the current draft does not address that,” said Vrijesh Upadhayaya of the Bharatiya Mazdoor Sangh.“Though, it talks about covering the gig workers, but it is this category of worker who is always under pressure of losing job in the current economic slowdown. In that case, how can the government expect them to make a monthly contribution towards PF when there is no job certainty,” Upadhyaya said.

from Economic Times https://ift.tt/2OiUzNj