The Apprentices Act, 1961 has been amended recently.
The amendments were passed in furtherance to the 'Make in
India' and 'Skill India' agenda that the current
government is trying to promote. The rationale behind the
amendments is to help Indian youth develop useful skills and
consequently increase employment opportunities.
It not uncommon for companies in the manufacturing sector in
India to receive notices under the Apprentices Act, 1961
(Apprentices Act). However, in the last few
months, quite a few companies in the service sector - including
software and IT companies - also seem to have received notices
under the Apprentices Act. These notices, issued by the regional
Board of Apprenticeship and Training, require the establishment to
engage apprentices as specified in the notice, and comply with the
provisions of the Apprentices Act. As a result, services companies
have also started taking a more active interest in understanding
the requirements under the Apprentices Act, and the ideal approach
for ensuring compliance with the law.
AMENDMENT TO THE APPRENTICES ACT - SIGNIFICANT CHANGES
The Apprentices Act is one of the key legislations that appears
to be high on the current government's agenda. The rationale
being that apprenticeship training will help the Indian youth
develop useful skills, and consequently increase employment
opportunities. To ensure effective implementation of the
Apprentices Act, certain changes were also introduced by the
Apprentices (Amendment) Act, 2014 (Amendment),
which came into effect on 22 December 2014.
Some of the key changes brought about by the Amendment are as
The definition of 'worker'
under the Apprentices Act has been broadened to include contractual
workers and agency workers as well. This is relevant since the
number of workers in an establishment is one of the factors which
would be considered while determining the number of apprentices to
be appointed in the establishment.
The Amendment paves the way for
moving to an electronic records and information system, by
providing for a portal site to be set up. This would allow certain
functions such as registration of the apprenticeship contract,
maintaining records and returns, etc. to be performed online.
The Amendment has brought about a
change in the manner of determining the number of apprentices to be
Imprisonment is no longer a penalty
for violations under the Apprentices Act. After the Amendment, any
non-compliance would be punishable only with a fine.
The intent behind these changes appears to be to ensure that
employers engage a larger number of apprentices, and to encourage
employers to comply with the provisions of the Apprentices Act.
INCREASE IN IMPLEMENTATION AND IMPACT
While the Apprentices Act is a central law and applies uniformly
across states, it is the regional authorities who are responsible
for its implementation in each state. It appears that at present it
is primarily the authorities in the National Capital Region that
have been proactively pursuing the implementation of the
Apprentices Act. However, it is only a matter of time before the
authorities in other regions also start taking active steps towards
ensuring implementation. In addition, it is anticipated that
corresponding changes will soon be introduced in the rules, based
on the Amendment - which is likely to increase the drive towards
enforcing implementation of this legislation.
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