Improving Productivity and Workers' Well-Being - Two Barometers of the Labor Law Scale

Improving Productivity and Workers’ Well-Being – Two Barometers of the Labor Law Scale

Standardization, simplification, digitization and rationalization were the basic principles for the issuance of the four new labor laws, comprising 29 central labor regulations. The tokens aim to expand coverage, standardize and simplify compliance requirements and enhance the ease of doing business. But what do employees/workers get from the new laws – are they entitled to better benefits? Will it increase their productivity? Do tokens provide better ways for their well-being? The answer to all of the above is “yes”. Let’s see how.

Working hours and rest days

The codes provide a maximum number of normal working hours per day (8 hours) and a total of 12 hours including overtime. Employers need to pay double the wage rate for overtime hours. Moreover, a weekly rest day is set after 6 days of work. The Safety, Health and Working Conditions Act (the “Occupational Safety and Health Code”) capped the total hours of overtime each quarter at 125 hours and introduced provisions limiting the number of vacation days that could be carried over to 30 days. This means that the leave balance in excess of this limit must be spent. Due to the financial implications for employers, employees will be encouraged to use time off allowing for a better work life balance.

Flexibility in Social Security Contributions and Enhanced Benefits

Current regulations stipulate a flat rate for employer and employee contributions to a provident fund. However, the Social Security Act enables employees to contribute at a higher rate if they wish, without coercing the employer to match higher contributions. Employees will also be eligible for higher gratuity benefits as the bonus will be calculated on wages as defined by the laws, compared to the base salary, which was the norm.

Broader social security coverage

Under the Social Security Act, employees of a fixed term are required to be treated on an equal footing with regular employees, giving them bonus benefits after one year of service.

The law also extends benefits to the sliding work platform and home-based workers as well as interstate migrant workers. Gig workers have been defined as those who perform work or participate in a work arrangement and earn from it outside the traditional working relationship.

The government will notify a plan to disseminate benefits (related to insurance, health and maternity benefits, nurseries, old-age protection, life and accident coverage, etc.) to these categories. Registration through the Schramm portal has already been completed. If gig/platform workers are involved by aggregators who are digital intermediaries that connect buyer and seller (such as e-commerce portals, cab service providers, food delivery, etc.), the blog provided a contribution by the aggregator in the 1-2% range of the annual turnover, subject to a maximum of 5% of the amount paid / payable to such workers.

employee safety

As we move towards a more inclusive society, there are restrictions on the type and duration of employment along with the need to ensure the safety of female employees on the commute to and during work. The Occupational Health and Safety Act enables women to work outside normal working hours, including night shifts, with their consent. The employer must ensure safe working conditions and transportation arrangements for female employees. Maternity benefits including foster care facilities are also provided regardless of whether the employee is working from the office or otherwise.

Focus on hygiene and health care

The Occupational Safety and Health Act places the responsibility on the employer to provide a clean, hygienic, well-ventilated workplace with appropriate temperature and humidity settings, free from pollution, safe drinking water, well lit, and with separate rest room facilities.

Proactive advice to employers

The role of the inspector has been expanded to include that of an “inspector-deputy facilitator” to enable organizations to obtain guidance when initiating the compliance process. Furthermore, the Social Security Act states that investigations cannot be opened after the past five years and gives two years to complete a continuous one. This will reduce uncertainty and long-term litigation and indirectly help employees/workers.

While the tokens come with hope for a better future for employers and employees in general, implementation in letter and spirit is key. Notification of the actual date of labor laws is important for employees to realize the benefit of these changes. Let’s hope to hear about this soon.



The opinions expressed above are those of the author.

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