New Delhi, December 21: Many economists have every now and then streamlined the big problems Indian economy is grappling with. One among many reasons figured out by them is the reduction in disposable income of the people, which also attributed to the prolonged slowdown.
Now in order to beat the slowdown the government come up with Social Security Code Bill 2019. This bill was tabled in Lok Sabha by labour minister Santosh Gangwar last week.
Let us quickly understand what would be the impact of this on you and how it is going to benefit you.
In this new bill, employees of some sectors will have an option to reduce their contributions into provident fund from 12 per cent to 10 per cent while the contribution of employers will remain same. If the Parliament gives approval to this Social Security Code Bill, roughly 50 crore employees would avail the benefit of this bill.
After being passed, the new law will encompass the eight Central Labour Acts such as Employees’ Compensation Act, 1923, Employees State Insurance Act, 1948, Employees Provident Funds and Miscellaneous Provisions Act, 1952, Maternity Benefit Act, 1961, Payment of Gratuity Act, 1972, Cine Workers Welfare Fund Act, 1981, Building and Other Construction Workers Cess Act, 1996 and Unorganised Workers Social Security Act, 2008.
Another important feature of the bill tabled in the lower house is set up of a new Social Security Fund, which will provide many welfare benefits such as death and disability benefit pensions.
Pursuant to the Payment of Gratuity Act, 1972, fixed-term contract workers was not eligible for gratuity on a pro-rata basis before completing five years continuously work, but the new bill will make them eligible without any term condition of work.
The labour ministry has dismissed the option for employees to switch to National Pension Scheme (NPS) from Employees’ Provident Fund Organisation. With the new law, employees will have to choose the one among Employee Pension Scheme under EPFO or NPS..
The labour ministry is going to club up 44 laws into four codes, on the basis of wages, industrial relations, social security and safety.
One thing is pretty clear, the government’s initiative to pull out the sagging economy from the gloom is going to benefit you by providing more money in your hand.