Posted in Indian Economy

Labour Reforms

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Labour Reforms

We see a significant improvement in industrial harmony in India is evident from the fact that mandays lost on account of strikes and lockout have been steadily declining, from 17.6 million in 2009 to 1.79 million (Provisional) to December The multiplicity of labour laws and difficulty in complying with them has always been cited as an impediment to industrial development in India. This is why labour reforms has been made and active part of the ongoing economic reform process in the country. In a major initiative for ensuring compliance and promoting ease of doing business, the government has initiated a number of labour reform measures. Thus, amendments have been proposed to labour laws to align them with the demands of a changing labour market. Individually, states like Rajasthan have also introduced major reforms in three labour legislations—the Industrial Disputes Act, Factories Act, and Contract Labour Act. In the past few years, several new initiatives have been taken by the GoI in this directions which may be summed-up briefly as given below:

1. The Apprentice Act 1961 was amended in December 2014 to make it more responsive to industry and youth. The ‘Apprentice Protsahan Yojana’ was also launched to support MSMEs in the manufacturing sector in engaging apprentices. Government is also working affirmatively to bring a single uniform law for the MSME sector to ensure operational efficiency and improve productivity while ensuring job creation on a large scale.

2. A unified labour portal scheme called Shram Suvidha Portal has been launched for timely redressal of grievances and for creating a conducive environment for industrial development. Its main features are—
(i) Unique Labour Identification Number (LIN) allotted to around 0.7 million units facilitating online registration;
(ii) Filing of selfcertified, simplified single online return instead of 16 separate returns by industry;
(iii) Transparent labour inspection scheme via computerised system as per risk-based criteria and uploading of inspection reports within 72 hours by labour inspectors.

3. Under Employees’ State Insurance Corporation (ESIC) Project Panchdeep: Digitisation of internal and external processes to ensure efficiency in operations, especially services to employers and insured persons. The portal enables employers to file monthly contributions, generate temporary identity cards and create monthly contribution challans online, issue of pehchan card for insured persons for fast and convenient delivery of services. Through the IP Portal, insured persons can check contributions paid/ payable by employers, family details, entitlement to various benefits, and status of claims. Integration of its services will promote ease of business and curb transaction costs.

4. Under Employees Provident Fund (EPF): Digitisation of complete database of 42.3 million EPF subscribers and allotment of universal account number (UAN) to each member, which facilitates portability of member accounts. UAN is being seeded with bank account, Aadhar Card and other KYC details to promote financial inclusion. Direct access to EPF accounts will enable members to access and consolidate previous accounts.

Online pensioners can view their account and disbursement details online. The statutory wage ceiling under the Employees Provident Fund and Miscellaneous Provisions (EPF&MP) Act was enhanced to Rs. 15,000 per month and a minimum pension of Rs.1,000 has been introduced for pensioners under the Employees’ Pension Scheme-1995 from September 2014.

5. For Unorganised Workers: The Rashtriya Swasthya Bima Yojana (RSBY) is a scheme under the Unorganised Workers’ Social Security Act 2008. It is a smart card-based cashless health insurance the scheme, including maternity benefit, which provides a cover of Rs 30,000 per family per annum on a family floater basis to below poverty line (BPL) families in the unorganised sector. It is proposed to extend the RSBY to all unorganised workers in a phased manner.

6. National Council for Vocational Training- Management Information System (NCVTMIS) portal has been developed for streamlining the functioning of Industrial Training Institutes (ITIs), Apprenticeship the Scheme, and assessment/certification of all NCVT training courses.

7. National Career Services Portal: The Government is mandated to maintain a free employment service for its citizens. This is now being transformed with the launch of the National Career Service (NCS) Portal in July 2015. The NCS is envisaged as a digital portal that will provide a nationwide online platform for job seekers and employers for job matching in a dynamic, efficient and responsive manner.

8. Payment of Bonus (Amendment) Act 2015: The Act passed in December 2015, has redefined the eligibility for bonus payment of the Payment of Bonus Act 1965 from Rs. 10,000 to Rs. 21,000 per month. This will not only enhance the bonus payment to the employees but make more eligible to the same.

Industrial development and employment generation have been hindered in India by the multiplicity of labour laws and their compliance. Working in the direction to remedy this situation, the Government has proposed (by late March 2017) to group 39 central labour laws into ‘four or five’ Labour Codes in the coming days. There are several other new measures under consideration towards simplifying the labour regulation regime in the country.

Child Labour

India faces the problem of child labour. There is need of a multi-pronged strategy which can rehabilitate children withdrawn from work through specific schemes and universal elementary education. It needs supplemented with economic rehabilitation of their families also.

In 2015, the GoI launched the National Child Labour Project (NCLP) Scheme under which children rescued/withdrawn from work in the age group of 9-14 years are enrolled in NCLP special training centres, where they are provided bridge education, vocational training, midday meal, stipend, health care, etc., before being mainstreamed into formal education system. Children in the age group of 5-8 years are directly linked to the formal education system through close coordination with the Sarva Shiksha Abhiyaan (SSA).

Government has also proposed an amendment in the Child Labour (Prohibition and Regulation) Act, 1986 which aims at the complete prohibition on employment of children below 14 years along with linking the age of prohibition with the age under the Right of Children to Free and Compulsory Education Act 2009. The amendment also includes the provisions for stricter punishment for employers.

PS : How to prepare Indian Economy for UPSC ?

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