Given the immense impact that the pandemic has had on travel and employment, government and finance officials have implemented several Covid-19 relief packages and LTC changes in India.

Adjustments in Leave Travel Concession/Allowance

The Indian Parliament has now passed 3 main labor reform bills for 2020; the Social Security code, the Industrial Relations Code, and the Occupational Safety, Health and Working Conditions Code. The codes are intended to be implemented from April 1, 2021. Key highlights of each are below.

  • The Code On Social Security, 2020 extends social security to all employees in any sector, and enables the Central Government to make it applicable to any establishment or class of establishment. The guidelines in regards to this are to be determined.
  • Employers must register for Employees’ Provident Fund Organization (“EPFO”), if there are at least 20 employees. Also, there is an option for an organization to register for EPFO even if they have less than 20 workers.

The Industrial Relations Code, 2020:

  • An establishment that has 300 or more workers is required to obtain prior government permission before lay-off, closure, or retrenchment.

The Occupational Safety, Health and Working Conditions Code

  • Directly applies to businesses with 10 or more workers, and to establishments or contractors employing at least 50 contract workers.
  • Code will now extend to workers from IT and Service Sector.
  • Maximum daily work hours set at 8 hours per day.

Employer Considerations:
These changes will pertain mostly to manufacturing and low-income labor sectors. However, some additional updates will apply to all employers, and each case will need to be analyzed individually to determine any changes in remuneration, policies, etc.

The information shared in this article provides general information only, and not professional advice. If you need to consult on international expansion of your business or have specific questions about local policy compliance, contact us today to speak to one of our experts.

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