The amendments to the Labour laws in Rajasthan that was proposed
by the Chief Minister Vasundhara Raje Scindia had been approved by
the President of India late last year. The Rajasthan Legislative
Assembly had passed Bills amending the rules under the central
government of four key labour laws, with the intention of easing
the process of hiring, training and dismissing worker easier as
well to strengthen the rules for trade union registration, among
other things. The amendments were to the Factories Act 1948, the
Industrial Disputes Act 1947, the Apprenticeship Act 1961 and the
Contract Labour (Regulation and Abolition) Act 1970. These statutes
as they existed made it difficult for industrial unit owners not
only to engage temporary labour but also to close factories that
employed 100 or more workers.
Amendments to the Industrial Disputes Act, 1947:
Industrial unit owners and employers can lay off employees or
shut down units if the company employs up to 300 employees without
permission of the government as against the earlier maximum limit
of 100 employees;
In case such retrenchment, the worker may raise an objection in
three months as opposed to no time limit earlier); and
A labour union can be formed if there is 30 per cent of the
total membership as against the earlier 15 per cent.
Amendments to the Factories Act, 1948:
Those factories operating without power may employ a
maximum of 40 labourers (as opposed to 20 earlier) and the
factories operating with power may employ a maximum of 20 labourers
( as against 10 earlier)
Any employee with a grievance against his employer for the
violation of this Act may seek redressal in any court of
Amendments to the Contract Labour Act,
This act is now applicable
to establishments employing 50 contract workers, the earlier
threshold being 20. This increase in upper limits ensures better
compliance be small entrepreneurs and
Amendments to the Apprenticeship Act 1961:
It includes a third party
training provider and easing rules to add more
Impact of the Amendments:
Companies now have the
flexibility to hire employees or lay them off to adjust to the
demand-supply scenario that exists in the markets at any given
time. Loss- making businesses can be dumped without delay or
without loss of precious resources. With the reduced thresholds for
labour union memberships, inter-union conflicts and multiplicity
can be reduced or even completely avoided. The management-labour
interface reduces leading to fewer conflicts and lessens the losses
due to these conflicts. With the Amendments in the Factories Act
reducing the number of workers in a factory, companies now have
reduced burden of compliance, allowing factory a management greater
accent on production innovation and harnessing efficiencies.
As anticipated, business chambers in India
have welcomed these changes as a positive step towards
encouraging employment generation and focus on production. The
Confederation of Indian Industry has stated "We have been
recommending these key reforms for bringing in simplification and
flexibility in engagement and deployment of labour, which should be
the two key cornerstones for any labour law reforms.
While these amendments are seen on the
whole by the industry as innovations that opens a window to
opportunities globally, the labour unions not unnaturally contend
that this move will hurt workers badly. With these
amendments, both the central and state governments have firmly
taken the side of Industry and the laws protecting the poor
labourers are amended to facilitate more rapid
With the 'Make in India' campaign
of the Prime Minister uppermost in priority, the state governments
are making hay. Madhya Pradesh is following suit and states like
Gujarat and Haryana are not far behind. The Madhya Pradesh
(MP) Government has proposed amendments to eight labour laws
including the Industrial Disputes Act 1947, Factories Act 1948 and
the Contract Labour Act 1970. MP also proposes changes to The
Building and Other Construction Workers (BOCW) Act, the BOCW
Workers Cess Act, The Child Labour Act and the Inter-State Migrant
Workmen and Motor Transport Workers Act.
'Make in India' can only be success
if the labourers are also wooed with sweeteners like this amendment
woos the industry. India is a land of human- resource plenty.
If India Inc has to flourish, the scales cannot be tipped against
the major Indian resource that is the 'Common
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On 31 December 2015 the President gave his assent to certain amendments to the Payment of Bonus Act, 1965. The amendments have increased the wage threshold for determining applicability of the Act from INR 10,000 to INR 21,000 per month.
The Payment of Bonus Act, 1965 provides for the payment of statutory bonus to eligible employees. The bonus payable is to be determined on the basis of profits or on the basis of production or productivity of the establishment.
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