Content
- Code on Social Security, 2020: Towards Universal and Inclusive Social Protection
- Occupational Safety, Health and Working Conditions (OSH) Code, 2020
Code on Social Security, 2020: Towards Universal and Inclusive Social Protection
Why is it in News?
- Government highlighted universal and inclusive social protection under the Code on Social Security, 2020.
- Recent PIB note emphasized nationwide EPFO–ESIC coverage, recognition of gig/platform workers, and women-centric reforms (Nov 2025).
- Renewed attention due to ongoing implementation of the four Labour Codes.
Relevance
GS 2 – Governance
- Social protection architecture: PF, ESIC, maternity, insurance, pension.
- Welfare of vulnerable groups: unorganised workers, gig/platform workers, migrants.
- Public policy design: portability, digital governance, Aadhaar-based delivery.
- Women-centric labour welfare reforms: maternity benefits, crèche, nursing breaks.
GS 3 – Indian Economy
- Labour reforms for economic growth and formalisation.
- Impact on labour market flexibility: fixed-term employment, gig work regulation.
- Ease of Doing Business: decriminalisation, digitalisation, reduced compliance costs.
- Social Security Fund: financing challenges, CSR inflows, fiscal implications.
- Employment generation via universal coverage and career centres.
What is the Code on Social Security, 2020?
- Consolidates nine major social security laws into one unified framework.
- Covers organized, unorganized, gig and platform workers.
- Creates a universal social protection architecture, integrating PF, ESIC, maternity, insurance, gratuity and unorganized workers’ welfare.
- Part of the larger labour-law rationalisation (4 Labour Codes).
Objectives
- Universalisation of social security.
- Portability of benefits for migrant workers.
- Simplification of compliance.
- Technology-driven administration through digital records and national registration.
- Women-focused reforms to improve workforce participation.
- Ease of Doing Business via decriminalisation and compounding.
Structural Features of the Code
- Merges nine Acts: EPF Act, ESIC Act, Maternity Benefit Act, Unorganized Workers’ Social Security Act, Gratuity Act, Employment Exchanges Act, etc.
- Three-tier social security framework:
- National Social Security Board
- State Social Security Board
- Social Security Organisations (EPFO, ESIC, etc.)
- Extends EPFO & ESIC coverage nationwide.
- Recognises gig and platform workers for the first time.
- Creates a Social Security Fund for unorganised + gig workers.
- Uniform definition of wages for all codes.
A. Pro-Worker Reforms
Gratuity for Fixed Term Employees
- Eligibility reduced to one year (not five).
- Encourages firms to hire FTEs without depriving them of social security.
Gig & Platform Worker Coverage
- First statutory recognition in India.
- Social Security Fund created from Govt contributions, CSR, compounding fines.
- National & State Boards to design schemes.
- Bridges the welfare vacuum in digital economy.
Universal EPFO coverage
- Coverage now establishment-based, irrespective of industry type.
- Applies to 20+ employees.
- Removes litigation on Schedule-I applicability.
National Registration & Unique ID
- National database for unorganised, gig and migrant workers.
- Aadhaar-based Universal ID ensures portability of benefits.
Uniform definition of Wages
- “Wage” = Basic + DA + Retaining allowance.
- Allowances >50% added back.
- Leads to higher PF, gratuity, maternity, pension calculations.
Expanded Family Definition
- Includes parents-in-law (subject to income conditions).
- Includes dependent minor siblings.
- Enhances ESIC coverage for family members.
Commuting Accidents = Work Accidents
- Accidents while travelling to/from work counted as employment injury.
- Ensures compensation/ESIC benefits.
Universal ESIC Coverage
- ESIC extended pan-India (earlier only notified areas).
- Voluntary ESIC for <10 workers.
- Mandatory ESIC even for 1 worker in hazardous occupations.
B. Pro-Women Reforms
Maternity Benefit
- 26 weeks leave; 8 weeks pre-delivery.
- 12 weeks for adoptive/commissioning mothers.
- Eligibility: 80 days service.
Work-from-Home Option
- Flexible post-maternity work arrangements.
- Based on nature of work + mutual agreement.
Simplified Medical Proof
- Certificates from doctor/ASHA/ANM/midwife.
Medical Bonus
- ₹3500 if pre/post-natal care not provided.
Nursing Breaks
- 2 nursing breaks/day till child is 15 months.
Crèche Facility
- Mandatory for establishments with 50+ employees.
- Gender-neutral requirement.
- Crèche allowance if facility not provided (≥₹500 per child).
C. Pro-Growth (Ease of Doing Business) Reforms
Digitalisation
- E-records, e-returns → reduces compliance burden.
Time-Bound Inquiries
- EPFO inquiries capped at 5 years.
- To be completed within 2 years (+1-year extension allowed).
Reduced Deposit for Appeals
- Appeal deposit → 25% (earlier 40–70%).
Self-Assessment of Cess
- Speeds up welfare fund collection for construction workers.
ESIC for Plantations
- Plantation owners allowed voluntary ESIC entry.
Decriminalisation
- 13 offences → monetary fines instead of imprisonment.
- Mandatory 30-day improvement notice before prosecution.
- Encourages voluntary compliance.
Inspector-cum-Facilitator
- Replaces inspector raj with guidance-based approach.
- Web-based inspections reduce discretion.
Compounding of Offences
- First-time offences compoundable.
- Fines at 50%/75% of maximum.
- Reduces litigation and court burden.
D. Pro-Employment Reforms
Career Centres
- Modernised employment exchanges (digital + physical).
- Employer vacancy reporting mandatory.
Fixed Term Employment Reforms
- FTEs get same social security benefits as permanent employees.
- Gratuity after one year.
Universal Coverage of Workers
- Extends schemes to:
- Gig workers
- Platform workers
- Unorganised workers
- Self-employed
- Ensures life, disability, health, maternity and pension benefits.
Strengths of the Code
- Universalisation: First attempt to cover every worker category under social security.
- Gig/platform recognition: India among early movers globally.
- Women empowerment: Progressive maternity, crèche and flexibility provisions.
- Simplification: Nine laws merged → reduces compliance complexity.
- Portability: National database ensures migrant workers don’t lose benefits.
- Digital governance: Improves transparency & efficiency.
- Gratuity reforms: Makes fixed-term employment more attractive and secure.
- Improved ease of business: Decriminalisation + compounding + digitalisation.
Challenges
- Implementation lag: Labour codes not fully notified by many states.
- Gig worker coverage depends on state actions (scheme design + fund utilisation).
- Funding adequacy of the Social Security Fund is unclear.
- Compliance burden may persist for small firms despite digital systems.
- Awareness among unorganised workers remains low.
- National database requires robust Aadhaar-based authentication — risk of exclusion.
Conclusion
- The Code on Social Security, 2020 is India’s most ambitious labour welfare reform.
- Ensures universal, portable, technology-driven social protection.
- Expands coverage to gig/platform workers, women workers, migrants and unorganised workers.
- Simplifies compliance through decriminalisation and digitalisation, aligning with Viksit Bharat 2047 goals.
- Full benefits depend on state-level implementation and effective scheme roll-out.
Occupational Safety, Health and Working Conditions (OSH) Code, 2020
Why is it in News?
- Government highlighted major provisions of OSH Code, 2020 , stressing:
- Consolidation of 13 Central labour laws → 1 Code.
- Uniform standards on safety, health, working conditions across sectors.
- Emphasis on formalisation, reduced compliance burden, worker welfare, and ease of doing business.
- New rules on working hours, migrant workers, contract labour, factory thresholds, women’s night work, etc.
- Part of larger labour reforms to create a modern, uniform, transparent labour ecosystem.
Relevance
GS 2 – Governance
- Workplace safety standards, worker rights, welfare mechanisms.
- Migrant worker protection; portability of benefits.
- Regulatory reforms: inspector-cum-facilitator, third-party audits.
- Tripartite OSH Standards Board → cooperative federalism.
GS 3 – Indian Economy
- Formalisation of workforce via single registration, digital records.
- Ease of Doing Business through uniform standards, reduced thresholds, digitised compliance.
- Labour market flexibility: contract labour provisions, revised factory thresholds.
- Productivity outcomes via health checks and safety committees.
GS 1 – Society
- Inclusion of women in all sectors and night work with safeguards.
- Better working conditions for migrant workers, unorganised workers.
Basics
- One of the four labour codes passed in 2020 (others: Social Security, IR Code, Wages Code).
- Consolidates laws governing factory safety, working conditions, migrant workers, contract labour, journalists, mines, plantations, construction workers.
- Applies to all establishments as notified; universal coverage possible for hazardous work.
Structural Reform: What Has Been Simplified?
- 13 laws → 1 Code, 620 sections → 143, 868 rules → 175.
- Registration: 6 → 1.
- Licences: 4 → 1.
- Forms: 55 → 20.
- Returns: 21 → 1.
- Compounding & improvement notice: Newly introduced.
Key Worker-Centric Provisions (Safety, Health, Welfare)
Formalisation through Appointment Letters
- Mandatory written appointment letters specifying wages, designation, social security.
- Enhances transparency, reduces disputes, curbs exploitation.
Annual Leave Eligibility Reduced
- Eligibility reduced 240 → 180 days of work per calendar year.
- Improves rest, health, productivity.
Working Hours & Overtime
- 8 hours/day, 48 hours/week; flexible weekly arrangements.
- Govt can fix overtime limits beyond earlier cap of 75 hours/quarter.
- Overtime at twice normal wages.
Inter-State Migrant Workers
- Broader definition: direct, contracted, self-migrant workers.
- Benefits:
- Annual to-and-fro journey allowance.
- BOCW and PDS portability.
- Toll-free grievance helpline.
- Mandatory reporting of ISMW numbers by establishments.
National Worker Database
- For unorganised workers including migrants.
- Enables skilling, job mapping, and social security eligibility portability.
Victim Compensation
- Courts must transfer minimum 50% of fine as compensation to injured worker/legal heirs.
Expanded Coverage: AV Workers & Journalists
- Covers digital media, OTT, online journalists, dubbing artists, stunt performers.
Safety Committees
- Mandatory for:
- Factories ≥ 500 workers
- BOCW establishments ≥ 250 workers
- Mines ≥ 100 workers
- Worker representation ensures participatory safety.
Universal Safety Coverage
- Earlier 7 sectors → now all sectors, unless specifically exempted.
Free Annual Health Check-ups
- Mandatory for every employee.
- Preventive health measure reducing long-term risks.
National OSH Standards Board
- Replaces 6 sectoral boards.
- Tripartite (workers–employers–States).
- Sets mandatory national OSH standards.
Industry Facilitation & Ease of Doing Business
Electronic Single Registration & Single Return
- Replaces multiple registrations.
- Cuts compliance time and cost; promotes formalisation.
Revised Factory Thresholds
- 10 → 20 workers with power, 20 → 40 without power.
- Time-bound approvals (30 days; deemed approval).
- Boosts small-scale industrial expansion.
Inspector-cum-Facilitator Model
- Ensures:
- Web-based random inspections
- Transparent processes
- Guidance over policing
- Reduces “inspector raj.”
Third-Party Audits
- For startups & notified establishments.
- Faster compliance checks, reduced interference.
Reduction of Registers
- 84 → 8 registers.
- Full digitization.
Contract Labour Reforms
Clearer Core vs. Non-Core Activity Definitions
- Contract labour allowed even in core activity if:
- Traditionally done through contractors.
- Work does not require full-time workers.
- Sudden workload spike.
Threshold Increased
- Applicability 20 → 50 contract workers.
- Reduces compliance for small contractors.
Welfare & Timely Wages
- Principal employer responsible for:
- Safety facilities
- Wage payment if contractor defaults
Compounding & Decriminalization
Compounding
- Fine-only offences → compoundable at 50% of maximum fine.
- Fine/imprisonment offences → compoundable at 75%.
- Money credited to Social Security Fund for unorganised workers.
Improvement Notice
- Mandatory 30-day notice before prosecution.
- Encourages voluntary compliance.
Decriminalization
- Procedural lapses → monetary penalties.
- Reduces fear, litigation, and delays.
Women-Centric Provisions
Women Allowed in All Sectors, All Hours
- Women can work in all types of establishments, including night shifts.
- Requires:
- Consent
- Transport
- Safety arrangements
Crèche Facilities
- For establishments with 50+ workers.
- Gender-neutral (not only women).
- Common/shared crèches allowed.
Pro-Growth, Pro-Employment Outcomes
Encourages MSMEs
- Higher thresholds, simpler licensing, quicker approvals.
Supports Formalisation
- Mandatory appointment letters, digital records, registration.
Enhances Productivity
- Annual health checks, reduced leave threshold, safety committees.
Improves Female Labour Force Participation
- Night work permission + safety norms + crèche facilities.
Overview
Strengths
- Modernisation: Moves India toward global OSH benchmarks (ILO Convention 155).
- Worker protection: Annual health checks, safety committees, universal safety coverage.
- Lower compliance burden: Single licence, single return, electronic records.
- Gender inclusivity: Night work permissions with safeguards.
- Clarity for gig, digital and new-economy workers: Journalists, AV workers, stunt staff.
Concerns
- Implementation gap: States must frame rules; delays continue.
- Inspector-cum-facilitator may dilute enforcement if not independently audited.
- Contract labour flexibility may:
- Increase precarity in certain high-value sectors.
- Threshold increases may exclude many small units from safety regulations.
- Migrant worker benefits depend on completeness of national database and Aadhaar seeding.
Overall Assessment
- A significant structural reform bridging fragmented labour laws into a unified framework.
- Balances worker rights with industry needs.
- Critical for India’s formalisation, industrial expansion, and safer workplaces.
- Success hinges on State-level rule-making, digital infrastructure, and effective monitoring.
