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12 Jan, 5 tweets, 1 min read
Exclusive: The government plans to introduce grandfathering provisions under the labour codes to ensure that the gratuity outgo for companies does not significantly rise after the new law comes into effect from the next fiscal (2021-22)
bloombergquint.com/economy-financ…
This after concerns were raised that some of the new provisions in the labour laws for computing wages and gratuity will bump up costs for companies.
After the new labour codes come into effect, likely from April 1, the way companies structure employee salaries will undergo a significant change. The salaries will have to be structured in a manner so that all the monetary allowances are capped at 50% of the wage of an employee.
This may lead to a higher basic pay and dearness allowance component of the salary - used for computing various statutory deductions such PF, gratuity, etc. To address concerns of a surge in gratuity payments, in particular, the govt is likely to issue a clarification soon.
This move would lead to lesser gratuity for workers and cost saving for corporations.

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More from @someshjha7

Somesh Jha Profile picture
16 Dec 20
A personal update: Monday was my last day at Business Standard and I can truly count the past 3 years as the golden phase of my career, where I got the opportunity to not only report but also break some of the biggest news stories during this period.
From January, I will be writing for the @BloombergQuint.

Even though I will miss the adrenaline rush of finding my byline in the paper every morning, I am really excited about starting a new journey with a digital platform.
In this thread, I am sharing some of the work that I did at @bsindia, which is close to my heart.
Read 26 tweets
Somesh Jha Profile picture
7 Dec 20
Breaking: India's chief economic advisor wants the junked consumer spending report to be made public. Krishnamurthy Subramanian wrote to the National Statistical Commission seeking the survey report of 2017-18 for analysis in the upcoming Economic Survey.

business-standard.com/article/econom…
Consumer spending fell for the first time in more than four decades in 2017-18, primarily driven by slackening rural demand, sparking fears of rising poverty in the country. The government withheld the report which was made public by us in November, 2019:

business-standard.com/article/econom…
The day the survey results were made public by us the government announced scrapping of the survey report citing 'data quality issues.'

This was the first time the govt scrapped an NSSO survey of this scale since the stats body was established in 1950.

business-standard.com/article/econom…
Read 10 tweets
Somesh Jha Profile picture
12 Oct 20
Thread: Instead of hiking retrenchment compensation for workers, the Modi government has mooted a reskilling fund in the new labour codes.

Retrenched workers will get cash benefits to the tune of 15 days of their last drawn salary. But here's the catch.
Retrenched workers who take cash benefits from the new reskilling fund mooted in the labour codes may have to show proof of reskilling to the government.

But the story doesn't end here...

business-standard.com/article/econom…
If workers are unable to reskill within a fixed period of time, they will have to RETURN the money given to them by the government, according to a proposal being contemplated by the central government. Moreover, the workers may be asked to pay back an interest, too.
Read 7 tweets
Somesh Jha Profile picture
5 Oct 20
Work in the private sector? Thanks to the Modi government, your company can now convert your permanent job into a fixed term contract and take away your retrenchment benefits.

Read our story:

business-standard.com/article/econom…
While the farm Bills created a lot of controversy, contentious labour law changes had no-takers.

The government quietly did away with a key safeguard norm for workers to deter firms from converting existing permanent jobs into fixed-term contracts.
Why is this proposal dangerous?

In India, unlike in China, Vietnam and Indonesia, there will be no cap on the number of times fixed-term contracts can be renewed (companies can do it endlessly).

Fixed-term contracts are seen as stepping stone towards permanent jobs.
Read 9 tweets
Somesh Jha Profile picture
2 Oct 20
Just in: Ten central trade unions (which does not include RSS-affiliated Bharatiya Mazdoor Sangh) to go on a one-day nationwide strike on November 26 against labour codes and new farm laws.
Demands of trade unions:
*Cash transfer of Rs 7500 a month for all non-income tax paying families
*10 kg free ration/person a month to all needy
*Expansion of MGNREGA to provide 200 days’ work in a year in rural areas at enhanced wages; extension of employment guarantee to cities
*Withdraw all farm laws and labour codes
*Stop privatisation of public sector
*Withdraw the circular on forced premature retirement of government employees
*Provide pension to all, scrap NPS and restore earlier pension, improve EPS-95
Read 4 tweets
Somesh Jha Profile picture
28 Sep 20
Six months after a national lockdown was imposed, I travelled to 5 villages of Allahabad (now known as Prayagraj) to talk to over two dozen migrant workers who returned home.

"Nothing feels like home" for them as they struggle to make ends meet.

business-standard.com/article/econom… Image
Ramesh Chand (right) was 15 yrs old when his brother-in-law took him to Mumbai & gave him a job at his garment factory after his father died. Srivastava (now 46), who had made the 'city of dreams' his own, wasnt paid for during the lockdown even by his guardian. Image
According to official estimates, about 10 million workers returned to their home states after the lockdown. Close to one-third belonged to Uttar Pradesh and Allahabad saw the second highest reverse migration in the state (over 100,000). Image
Read 12 tweets

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