{"id":50558,"date":"2019-07-25T19:00:17","date_gmt":"2019-07-25T13:30:17","guid":{"rendered":"https:\/\/blogadmin.forumias.com\/?p=50558"},"modified":"2019-07-25T17:42:38","modified_gmt":"2019-07-25T12:12:38","slug":"7-pm-untangling-labour-laws-25th-july-2019","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/7-pm-untangling-labour-laws-25th-july-2019\/","title":{"rendered":"7 PM | Untangling labour laws | 25th July, 2019"},"content":{"rendered":"\n<p><strong>Context: <\/strong>labour\nlaws in India and its reforms<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Labor reforms\nessentially mean taking steps in increasing production, productivity, and\nemployment opportunities in the economy in such a manner that the interests of\nthe workers are not compromised.<\/li><li>Essen\u00adtially, it means\nskill development, retraining, redeployment, updating knowledge base of\nworkers-teachers, promotion of leadership qualities, etc. Labor reforms also\ninclude labor law reforms.<\/li><li>Labor laws are con\u00adcerned\nwith the trade union rights of the work\u00aders, industrial relations and job\nsecurity and policies relating to wages, bonus and other in\u00adcentive scheme<\/li><\/ul>\n\n\n\n<p><strong>&nbsp;Need for\nlabor reforms in India:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Segmented labor market:<\/strong>\nCaste and other forms of social discrimination have a long tradition in India,\nand these traditions have interacted with changing economic conditions and\ncapitalist conditions to generate peculiar forms of labor market in India like\nwage differences between different castes and different genders.<\/li><li><strong>Pattern of labor growth:<\/strong>\nin India labor force growth is unbalanced. about half of\nworkers engaged in agriculture, contributing to just 13% in GDP; 13% employed\nin manufacturing and contributes to 16% of GDP; services employ 27%, but\ncontributes close to 60% of GDP<\/li><li><strong>Informal\nsector:<\/strong>\nMore than 90% of the workforce in\nIndia is working as informal labor. These workers, who are without any written\ncontract, social security benefit and security of tenure but still contributes\n50% of the national income<\/li><li><strong>Modern inequalities:<\/strong>\nModern\nsector also shows striking inequality, with significant increase in contract\nand other flexible categories of workers &#8211; rising inequality in remuneration of\nproduction and managerial workers: ratio constant at 2 until late 1990s, but\nsharply rose thereafter and now stands around 4.5<\/li><li><strong>Contemporary times:<\/strong>\nMost\nof the labor laws were enacted 40-70 years back, to address the then needs of\nregulating the manufacturing sector. Today, service sector has taken the lead\nwith 55% share in the GDP. <\/li><li>Labor Laws need to be reoriented to\naddress the emerging needs of the service sector and the new technology\nintensive manufacturing sector. Labor laws need to be reviewed from time to\ntime to bring them in tune with the changing needs of the economy, such as\nhigher levels of productivity, competitiveness and investment promotion<\/li><li><strong>Ease of doing business (EoDB):<\/strong>\nmost of the inspection done through manually in India. While\nit is important to make some of the inspections manually, a road map of digital\ninspection should be instituted for better transparency. By promoting digital\ninspection india can improve its ranking of EoDB.<\/li><\/ul>\n\n\n\n<p><strong>Labor reforms taken by central government:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Codification of laws:<\/strong> In line\nwith recommendations of Second National Commission on Labor, the Ministry of\nLabor has taken steps for formulating of four Labor Codes on <ul><li>Wages; <\/li><\/ul><ul><li>Industrial Relations; <\/li><\/ul><ul><li>Social Security &amp; Welfare; and <\/li><\/ul><ul><li>Occupational Safety, Health and Working Conditions <\/li><\/ul><\/li><\/ul>\n\n\n\n<p>By\namalgamating, simplifying, and rationalizing the relevant provisions of the\nexisting Central Labor Laws.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Passage of Bills:<\/strong>\nthe government of India passed the bills of Labor code on Wages and code on\nOccupational safety Health and working conditions. These codes will provide\nsingle registration, single license, and single return for establishments and\nalso executing multiple projects.<\/li><li><strong>Minimum national wage:<\/strong>\ngovernment of India is promoting country wide minimum national wage so that\nemployee will not get wages less than prescribed limit. And at the same time\ngovernment addressed the fears of state governments by allowing them to fix\nseparate national minimum wages for different states<\/li><li><strong>Shram suvidha portal:<\/strong>\nThe Ministry of Labor &amp; Employment has developed a unified Web\nPortal \u2018Shram Suvidha Portal\u2019, to bring transparency and accountability in\nenforcement of labor laws and ease complexity of compliance.<\/li><\/ul>\n\n\n\n<p><strong>Labor reforms taken by states:<\/strong><\/p>\n\n\n\n<p><strong>Madhya Pradesh:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Companies in Madhya Pradesh that employ\nup to 300 people will be allowed to retrench workers or shut shop without\ngovernment approval (the current provision is for those employing up to 100\nworkers.) <\/li><li>Employers will have to give a higher\ncompensation package and workers will get a three months\u2019 notice and at least\nthree months\u2019 salary in the event of retrenchment.<\/li><li>The process for registration and grant\nof licenses has been expedited under several legislation, example under the\nContract Labor Act, Building and Other Construction Workers Act, and Motor\nTransport Workers Act. If an application is not disposed within 30 days it will\nbe deemed registered or approved license.<\/li><\/ul>\n\n\n\n<p><strong>Maharashtra:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The government has proposed an overtime\nof 115 hours from the present 75 hours for workers in small-scale industrial\nunits.<\/li><li>After Factories Act is amended, the\nunits operating without electricity would be considered a factory if they\nemploy 40 workers and units operating with electricity would be treated as a\nfactory if they employ 20 workers. The old limits were 20 and 10 workers\nrespectively. This will exempt the smaller units from the application of the\nFactories Act.<\/li><\/ul>\n\n\n\n<p><strong>Gujarat:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Where any Shops and Commercial\nEstablishment or factory employs 20 or more employees, it shall make the\npayment of minimum wages through bank account. This amendment will bring\ntransparency in paying minimum wages<\/li><li>According to the Building and Other\nConstruction Workers Act, 1996, the definition of worker is limited to the\nsupervisory workers who receive wages of Rs 1600 per month only. By reason\nthereof many of the supervisors are excluded from the applicability of the Act.\nTherefore the bill suggests increasing up to three times of the minimum wages\nfor skilled workers<\/li><\/ul>\n\n\n\n<p><strong>&nbsp;Further measures:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Government should pass the code on\nIndustrial relations as soon as possible, the bill give greater flexibility to\nhire more workers and attain economies of scale will improve India\u2019s\ncompetitiveness in global market.<\/li><li>The proposed measures should try to\nimprove the so called business environment by providing flexibility in hiring\nand firing of workers by raising the threshold limit of state permission and\nraising somewhat coverage of social security and welfare measures, in addition\nto improving the labor inspection machinery through technology<\/li><\/ul>\n\n\n\n<p><strong>Way\nforward:<\/strong>\nThus, in the current scenario, greater\nflexibility in labor laws must be en\u00adsured so that firms can adjust to changes\nin demand when necessary. The Government admits that the labor laws focus on\njob protection and thus inhibit employment. With growth rate picking up, a\nharmonious balance between efficiency and the quality of employment involving\nthe relationship between management and labor and welfare aspects needs to be\nmaintained.<\/p>\n\n\n\n<p>Source:<a href=\"https:\/\/www.business-standard.com\/article\/opinion\/untangling-labour-laws-119072401770_1.html\">https:\/\/www.business-standard.com\/article\/opinion\/untangling-labour-laws-119072401770_1.html<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Context: labour laws in India and its reforms Labor reforms essentially mean taking steps in increasing production, productivity, and employment opportunities in the economy in such a manner that the interests of the workers are not compromised. Essen\u00adtially, it means skill development, retraining, redeployment, updating knowledge base of workers-teachers, promotion of leadership qualities, etc. Labor&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/7-pm-untangling-labour-laws-25th-july-2019\/\">Continue reading <span class=\"screen-reader-text\">7 PM | Untangling labour laws | 25th July, 2019<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":49370,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[130,9],"tags":[],"class_list":["post-50558","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-7-pm","category-public","entry"],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2019\/07\/7-PM.png?fit=1000%2C500&ssl=1","views":{"total":0,"cached_at":"","cached_date":1704765798},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/50558","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=50558"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/50558\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media\/49370"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=50558"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=50558"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=50558"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}