Government Plans Launch of 'Labour Welfare and Employment Index' for State Rankings

Government is planning to introduce a 'Labour Welfare and Employment Index' (LWEI) to assess states and Union Territories on employment
Labour Welfare and Employment Index
Labour Welfare and Employment Index

Indian Government is reportedly planning to develop a 'Labour Welfare and Employment Index' (LWEI) to rank states and Union Territories based on various aspects like employment, labour welfare, social security coverage and productivity. The index will help in promoting healthy competition among states and improving ease of doing business.

As per sources cited in a report by the Financial Express, the Labour Ministry is expected to introduce the LWEI in the coming weeks following consultations with states, NITI Aayog, the International Labour Organisation (ILO), and other union ministries.

The index is intended to standardize the implementation of labour laws across states and has the overarching goal of enhancing labour welfare. The announcement of this plan may come in the upcoming budget, scheduled for next month.

In 2019-2020, the Narendra Modi government brought in multiple reforms to consolidate 44 labour-related acts into four codes. These reforms were presented to strengthen trade and investment, improve ease of doing business, streamline compliance requirements, address decriminalisation issues and enhance skill development.

The four codes include the Social Security Code 2020, Occupational Safety, Health and Working Conditions Code 2020, Industrial Relations Code 2020, and Code on Wages 2019.

The Labour Rights Index is a global tool and international benchmark that enables comparison of labour laws across 135 countries. This tool is largely aimed at improving the lives of workers.

Sources mentioned in the report also pointed out that besides LWEI the labour ministry's Budget proposals include plans to integrate the e-shram portal, which serves as a national database for workers in the informal sector, with other social security schemes. The government is also planning to extend the benefits of EPFO and ESIC to a broader segment of informal sector workers.

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