A sign that the government is wary of implementing labor codes after protests against the Agrarian Act

In addition to the current year, the state assembly elections in the next year and then the Lok Sabha elections in 2024 are scheduled, the possibility of the new labor law being implemented in the country becomes less and less. The four labor laws that were supposed to be implemented across the country at the beginning of the last financial year now seem unlikely to be implemented even in the current financial year. The government wants to ensure that the Labor Reform Act does not go into effect in the same way that the Agriculture Act was opposed and the government had to withdraw from it, and that is why it is believed that it has been shelved at present. As industrial owners and trade unions do not seem to be particularly enthusiastic about the new labor law, the government also seems to have chosen to move slowly on the issue. The government fears that the government will not move forward on the issue until there is complete agreement from all stakeholders, or else it may face a similar backlash as the farmers faced against the Agrarian Act.

The government has passed four labor codes in 2019 and 2020 to replace as many as 29 old and complex labor laws and implement new labor laws. These codes include codes related to social security, minimum wages, industrial relations and maintenance of employees' health and working environment. Although all these four codes have received the assent of the President, their implementation is lax for one reason or the other. Although the Center has promulgated rules for these codes, they have not been implemented. No date has been announced by the government for the implementation of the new labor law.

The country's complicated labor laws may not have hindered the pace of economic growth, but they have proved to be a headache for industries and investors. Fifty percent of the compliance standards applicable to industrial units are employee related. Less than ten percent of the total workforce in the country belongs to the organized sector. Both the Center and the states are ready to clean up the complex labor laws and it was also expected that they could be implemented in the near future.

The Union Ministry of Labor and Employment is still in consultation with the states, industrial organizations and trade unions regarding these laws to pave the way for smooth implementation of the laws. It is being expressed that the definition of the new wage scale will increase the cost of the companies behind the salary. The government is also discussing with the HR departments of various sectors regarding wage laws, which indicates that the government is positive in implementing the labor laws. It is claimed that the amendment in the labor law has ensured that the interests of both employers and employees are preserved, but it is also a fact that its implementation is lax.

Due to decades-old unworkable labor laws, India is lagging behind in terms of industrial competition with neighboring Bangladesh and China, especially in the manufacturing sector of garments and mobile phones. In its first term, the Modi government made sweeping proposals to overhaul complex labor laws and modernize the country's old and modern-day labor laws. It also floated the idea of ​​repealing many of the central labor laws that were impractical at the time. While the consideration has mostly been finalized and most of the states in the country have framed the rules, implementation is delayed due to laxity in a few states, state assembly elections and especially fear of employee protests.

The implementation of the new labor law has now become a test case for the government as the government bowed down to heavy opposition from farmers against the Agrarian Reform Act and was forced to postpone the implementation of the law.

In the industries of the country, the owners of the industries have to find some loophole to avoid the arbitrariness of the employee unions. In our country there is industrial competition between the states and the states also prepare the same industrial policy which suits them. In the post-economic liberalization period, industrial policies in the country that provide competitiveness in the industrial sector have hardly been formulated. 65 to 70 percent of the compliance difficulties faced by the business world are related to labor laws. Opportunities to create new jobs in the private sector as compared to the public sector will arise only when the implementation of favorable labor laws for these sectors is speeded up. With the deadlines for the implementation of the four labor laws being missed several times, it is now necessary to reach a consensus among all the stakeholders. However, this will be possible only when all stakeholders are interested in implementing the new law.