FICCI for shifting ‘labour’ from Concurrent to State List

In a note submitted to the Labour Ministry recently, industry chamber FICCI has suggested shifting labour from the Concurrent List of the Constitution to the State List to give State Governments “greater freedom in formulating labour policies”.

Stating that employment grew only at an average of 1.6 per cent even as the economy grew at 8 per cent between 2000 and 2009, FICCI outlined the need for regrouping close to 150 labour laws into four categories.

The first category could be of laws governing terms and conditions of employment, which may consolidate the Industrial Disputes Act, 1947, Industrial Employment (Standing Orders) Act, 1946 and the Trade Unions Act. 1926.

The second category could be laws governing wages, which may consolidate the Minimum Wages Act, 1948, Payment of Wages Act, 1936 and the Payment of Bonus Act, 1965.

The third category of laws governing welfare may consolidate the Factories Act, 1948, Shops and Establishments Act, Maternity Benefits Act, 1961, Employees' Compensation Act, 1952 and Contract Labour (Regulation & Abolition) Act, 1970.

The fourth category could concern laws governing social security, by integrating the Employees Provident Funds and Miscellaneous Provisions Act, 1952, Employees State Insurance Act, 1948 and the Payment of Gratuity Act, 1972, the chamber said.

The FICCI paper also called for a uniform definition of ‘employee’, ‘industry’ and ‘wages’ across all labour laws to minimise litigation.

It called for adopting a uniform practice of serving 14 days compulsory notice in the case of both ‘strike’ and ‘lockout’. “This provision right now exists only with regard to units engaged in ‘public utility services’,” it said, adding that the practice of ‘strike ballot’ by unions, adopted by developed countries, such as the UK, Germany, Australia etc, should be followed.

To exclude employees in the higher salary bracket enjoying statutory protection, the paper suggested that coverage of the Industrial Disputes Act should be confined to employees receiving salary only up to ₹20,000/month.

Taking cue from the Rajasthan Government’s amendments making hiring and firing easier, the industry lobby said requiring prior permission of the Government to go for retrenchment, closure or lay-off, by a company employing more than 100 employees, as mandated by Chapter V-B of the ID Act, was a “retrograde step.” It, therefore, called for enhancing this number to 300.

To provide flexibility to companies to engage contract workers, FICCI suggested deletion of Section 10 of the Contract Labour (Regulation & Abolition) Act, 1970, which, due to abolition of contract labour from one operation to the other, was making it difficult for companies to engage extra hands to discharge short-term contracts, including export commitments.

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