India: Skill Development Legal Framework In India

Last Updated: 8 October 2016
Article by Krishna Vijay Singh

Practical and theoretical training given to fresh learners to develop their professional or technical skill is called apprenticeship. The Indian apprenticeship system which is well established and supported by legislative and administrative arrangements regulates the training and protects the rights of apprentices in India. The rights of apprentices are protected under the Apprentices Act, 1961 ("Apprentices Act"). The Apprentices Act which surrounds the operation of apprenticeships in India is highly significant as it sets out the ways in which recruitment, training, conditions of work, contractual arrangements and compliances are organized.

The Apprentices Act in India was drawn up based on the principles of 'learning while earning' and 'learning by doing'. It envisaged to fully utilize the facilities available in the Indian industry for practical training with a view to meet the skilled manpower requirements of the industry. The apprentices under the Apprentices Act are categorized into four categories i.e. trade apprentices, graduate apprentices, technician apprentices and technician (vocational) apprentices. For each category of apprentices, educational prerequisites as prescribed under the Apprentices Act apply for undertaking apprenticeship training. For an apprentice to undergo apprenticeship training in India, he/ she has to enter into a contract with the employer which is to be registered with the Apprenticeship Advisor appointed under the Apprentices Act. The contract so entered lays down the terms and conditions of the training including the monthly stipend to be paid during the training period.

Despite the Apprentices Act being measured as a comprehensive legislation for safeguarding the interests of apprentices in India, certain issues like employment of apprentices on completion of training, low participation of both employers and workers in comparison to other countries, low stipend rates for apprentices, high levels of regulatory requirements for employers and shortage of trained teachers and trainers still persist in Indian apprenticeship system. Recently, the government by passing the Apprentices Amendment Act, 2014 has made significant efforts to reduce the level of regulatory barriers by doing away with penal provisions regarding imprisonment of the employer, simplifying registration of apprenticeship contracts by introducing online portal and giving employers the privilege of deciding the holidays, leaves and the working hours of training. But these efforts are not enough as apprentices working in unorganized sector or industries still remain largely deprived of these rights for want of enforcement of laws regulating their working conditions. Furthermore, the removal of penal provisions from the Apprentices Act can give rise to exploitation of apprentices.

In view of the above, one of the issues which has been under constant debate and discussion concerns the right of employment of the apprentices on completion of their training. Although the Apprentices Act does not cast any obligation on the employer for recruiting apprentice subsequent to the completion of his or her training, however, several cases have come up for adjudication before various courts and tribunals, where the apprentices have demanded legal right to employment after completion of their training.

One of the significant reasons for claiming such right is because of employment of workers by the employers on a large scale under the guise of apprentices. Certain employers believed that deployment of workers under the guise of apprentices will benefit the employer as apprentices cannot claim permanency or protection given to the workmen. It was alleged that employees/workmen were dubbed as apprentices so as to resort to summary termination and deny their legitimate benefits. The courts while dealing with such cases have given their decisions on the basis of facts and circumstances of each case. In this regard, reference may be made to the judgment of the Hon'ble Madras High Court in the matter of Workmen of Pmp Textiles vs. Management of Pmp Textile (2011 LLR 731). In the said matter no regular workers were employed by the management and all the persons working with the management were apprentices. The Hon'ble Court after going into the facts of the case observed that it would be impossible to believe that the entire production activity was being carried without any regular employee. Though the employees, all of whom were involved in the production activities, were called apprentices, the Hon'ble Madras High Court while relying upon the judgment of the Hon'ble Supreme Court in the case of Trambak Rubber Industries Ltd. Vs. Nashik Workers Union and Ors. took the view that the apprentices in question were to be treated as workmen.

However, the Hon'ble Allahbad High Court while dealing with the situation that whether an apprentice is a workman or not has held that the apprentice cannot claim employment on the basis of the nature of the work performed by him/her. In this regard reference may be made to the judgment of the Hon'ble Court, in the matter of Tannery & Footwear Corporation of India Limited vs Labour Court Kanpur [(1994) II LLJ 1186 (All.)], where the court held that an apprentice merely by discharging a function of a regular employee cannot turn around and say that he has become a regular employee. Accordingly, the question whether a trainee is a workman or not entirely depends upon the facts and circumstances of each case and no specific criteria can be defined to determine the same.

Another issue surrounding the apprenticeship is regarding the social benefits which have been often demanded by apprentices in India. Although the Apprentices Act is clear regarding non-applicability of provisions with respect to labour laws to apprentices, there have been several cases where the apprentices have demanded social security benefits from the employer provided under the said laws. In this regard, reference must be made to the Judgment of the Hon'ble Supreme Court in the case of R.P.F Commission Mangalore vs. Central Aercanut and Coca Marketing and Processing Co-operative limited [2006 I LLJ 995 (SC)], where the apex court held that the apprentices engaged under Section 2(aa) of the Apprentices Act are excluded from the definition of employee under Section 2(f ) of the Employers Provident Fund and Miscellaneous Provisions Act, 1952 and thus, are not entitled to any benefits granted under the said Act. Therefore, it is evident that apprentices working under the Apprentice Act are not covered under the provision of any labor law and are not entitled to any benefit granted under the labour welfare legislations.

Indian apprenticeship legislation has a powerful influence on the way the apprenticeship training is conducted in the country. Though, the government by passing the Apprentices Amendment Act, 2014 has taken steps to reduce the regulatory barriers, but even today the apprentices/trainees working in the unorganized sector are deprived of the rights granted to them. Therefore, there is a need of legislative responsiveness to change the demography and the voices of the industry as it is a crucial factor in the continuing success of apprenticeships as a way of providing skilled labour for the country.

Originally published in Human Capital, April 2015

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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