Under Wage codes companies can convert permanent jobs into contracts

Hi,

I read that as per Wage codes companies now can convert permanent jobs into contracts. It is not very clear. Someone please share more details.

2 Likes

Hi Chitra,

The Labour Codes (mainly under the Social Security Code and Industrial Relations Code) has introduced the concept of Fixed Term Employment (FTE).

In earlier times, this concept wasn’t there in India. In the year 2018, through the Industrial Standing Orders Act, this concept was introduced.

FTE is basically to employ a certain workforce that is not regular in nature for some industries. FTE, for the time being in force, do not have many statutory benefits attached to it.

The Labour Codes, as a reformation enable all the establishments to have employment under Fixed Term and such employees and workmen to have certain benefits.

An FT employee or worker’s working hours, wages, allowances and other benefits has to be equal to that of a permanent employee doing the same work or work of a similar nature.

An FT employee or worker shall be eligible for all benefits available to a permanent employee under any law for the time being in force. And such benefits shall be paid in proportion to the period of service rendered. It is not necessary for the period of service to extend to the required qualifying period of employment. e.g. Gratuity

Thanks & Regards,
Bhuvana Anand

1 Like
Powered by | India's No.1 Payroll and HR Software.
10,000+ Clients
150 Cities
1.3+ Million Users