ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Code on Wages and the Gig Economy

Code on Wages and the Gig Economy

The Code on Wages, 2019 ostensibly seeks to harmonise four different laws governing the payment of wages and minimum wages in India, and “simplify and rationalise” the law. However, it is a missed opportunity to update the definition of “employee” in the context of the rise of the “gig economy,” a source of livelihood for a large number of workers who do not enjoy formal protection under the labour laws.

The last month saw two very important developments in labour law. First, the Supreme Court of India delivered its judgment in Officer In-Charge, Sub-Regional Provident Fund Office v Godavari Garments (2019), holding that for the purposes of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (EPF Act), women who worked from home doing piece work would be considered “employees” of the company which had engaged them to do so, even if there was no direct contract of employment between the two. Though previous judgments had held thus in the context of bidi workers, this judgment’s significance lies in the current context of the so-called “gig economy,” where workers are not necessarily working out of a fixed place of employment, whether at home or elsewhere.

A second important development was the passage of the Code on Wages, 2019 by the Lok Sabha and the Rajya Sabha after having first been introduced in 2017. The Code on Wages, based on the recommendations of the report of the Second National Commission on Labour in 2002, seeks to repeal and replace four separate legislations dealing with wages—namely the Payment of Wages Act, 1936, the Minimum Wages Act, 1948, the Payment of Bonus Act, 1965, and the Equal Remuneration Act, 1976—with one comprehensive code which covers all the aspects of payment of wages hitherto covered under these laws.

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Updated On : 26th Aug, 2019

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