New Delhi, Mar 24 (IANS): Nearly half of the companies in India are confident about their readiness to implement the new labour codes, according to Grant Thornton Bharat's Industry Expectation Survey on New Labour Codes.
The survey, released at a webinar organised by Grant Thornton Bharat and CII, tapped into a respondent pool of over 4,000 middle to senior managers.
The survey brought out that 43 per cent organisations have started internal reviews with the objective of effective implementation of the new labor Codes.
While 13 per cent firms are waiting for the final announcement on implementation date, another 20 per cent firms have onboarded external consultants for better preparedness. Only about 20 per cent have not decided their implementation strategies yet, the survey said.
"Our survey shows that 64 per cent respondents are optimistic about the long-term impact of the implementation of new labour codes. Overall sentiment on the resulting changes is positive and businesses have their work cut out," said Vikas Vasal, National Managing Partner, Tax, Grant Thornton Bharat.
Akhil Chandna, Associate Partner, Grant Thornton Bharat, "It is encouraging to see that a large section of the respondents are aware of upcoming labour codes and have already started preparing for the transition. As the survey result shows, the overall employee compensation costs are expected to rise and it is important for organisations to evaluate the financial impact areas such as 'gratuity', 'leave encashment', 'statutory bonus', etc. for better planning."
The four Labour Codes, i.e. Code on Wages, Code on Social Security, The Occupational Safety, Health and Working Conditions Code (OSHWC) and The Industrial Relations Code are expected to bring in much awaited labour reforms in the country.
"As reflected in our survey, nearly 62 per cent of the organisations are really certain about increase in their compensation cost, thus the emphasis is towards getting their Human Resource Policies, Procedures, Service Rules, Employment Contracts etc. reviewed well before the implementation," said Leena Madhok, Director, Grant Thornton Advisory Pvt. Ltd.
In the survey, 85 per cent of respondents agreed that a minimum transition period of up to six months be allowed to implement various obligations and compliances applicable under new labour codes.
While 54 per cent think the new labour codes will achieve the objective of widening social security coverage to the unorganised sector, 29 per cent disagree.
Nearly 55 per cent respondents support the view that people with fixed minimum wage rate should be entitled to overtime payment; 29 per cent say this entitlement should be reserved for people in non-managerial roles.
Also, 66 per cent respondents voted in favour of providing organisations the flexibility to hire contractual employees for their core activities; 7 per cent not sure about the benefits.
About 54 per cent of the respondents believe that the compliance burden on employers would be reduced over a period of time under the new codes.