Labour Reforms

The central government has taken the first step in making big ticket reforms. However, it falls short of some game changing steps, which could have given a big boost to both the workmen and the industry.

As some print media said " It is an attempt to pluck low hanging fruits ", it surely appeared that way. I have read somewhere that the Rajasthan Government has come out with a better plan which is pending with the President of India for final approval. In that case the center should have been a step or two better only.

I would have like to see following inclusions in the proposal:

By the way the Rajasthan Government has already covered some of these issues.

• Labour Unions shall be recognised if they have a membership of at least 40 % of the strength as against 15 %.
• Applicability of Contract Labour ( Regulation & Abolition ) should be raised from 20 at present to 60 - 70 contract labour. But then the rules for regularisation of such labour and converting them to permanent employees, should be changes on the lines suggested down.
• The Contract Labour law should be reviewed and revised. I would suggest that the contract labour needed to work on a repetitive work for more than 1 year continuously should be taken on regular pay role of the company, if the work is operational in nature and directly related to production - manufacturing activity. The contract labour engaged as helpers, cleaners, sweepers etc can be engaged through a contractor. However, it would be the responsibility of the corporates to ensure that their salaries are given as per minimum wages acts, from time to time.The corporates should also ensure that the contractor covers them under ESIS, and other welfare schemes and also give a reasonable profit to the contractor.
• The Labour Unions should first give their demands in writing and seek amicable solutions through dialogues. The Corporates should give a timeline for at least 3 - 4 meetings for arriving at an amicable solution, failing which the matter should be taken up to a tribunal or state governments labour department. If no solution is arrived at, then the Labour Reforms should first seek redressal from the labour courts or high courts, before taking up the last step of a strike, after giving a notice of 1 month. This will certainly help in minimizing labour unrest.
• The working hours should be fixed. O T should be allowed only in case the reliever does not report on duty. This will ensure necessary health fitness levels across the board.
• The Overtime should be fixed at 2.5 / 3 times as against 2 times their basic and DA. This way the menace of engaging people on OT and not taking workmen on regular roles, will be minimized. The corporates.
• The Factory Act should be applicable for  minimum 40 workmen , against 10 at present, for  industries using power and 70 workmen against 20 at present, for industries not using power.
• Employers having a strength of 300 workmen against 100 at present, should be allowed to retrench workmen without seeking government's approval
• I have also observed that the unions normally enter in to an agreement with the managements for a period of 3 years, and the salary hike is normally 15 to 20 % and spread over 3 years. The corporates should be forced to agree for a hike which is either equal to or more than the cumulative inflation rate of preceding 3 years.

If these and some more steps are taken then we can see good boost to the economy and manufacturing sector as a whole.