The proposal is part of a bill introduced at the Lok Sabha on Saturday.
Companies with no fewer than 300 workers will soon be able to hire and fire workers without seeking prior permission from the government, and the Labor Ministry will propose changes to the rules in a bill presented in Lok Sabha on Saturday. The proposal, which was the bone of contention between the ministry and the unions, is part of the 2020 Industrial Relations Code.
Currently, only industrial establishments with fewer than 100 employees can hire and fire their staff without permission from the government. The bill was introduced by Labor Minister Santosh Gangwar amid opposition from Congress and some other parties.
Last year the draft law for the Industrial Relations Code 2019 was presented in Lok Sabha and subsequently sent to the Permanent Parliamentary Labor Commission. This bill was withdrawn on Saturday.
A draft law circulated by the Labor Ministry for discussion had also proposed the criterion that companies with no fewer than 300 employees can hire and fire without government permission. However, this provision faced strong opposition from the unions and was not included in the 2019 bill.
Earlier this year, the parliamentary commission also proposed allowing companies with fewer than 300 workers to go for downsizing or closure without government permission.
States such as Rajasthan have already raised the threshold to 300 workers, which, according to the Labor Ministry, has led to an increase in employment and a decrease in downsizing, the commission had noted in its report.
Regarding the threshold, the government has proposed Section 77 (1) in the 2020 Industrial Relations Code.
According to the Section, the provisions of “this Chapter (dismissal, reduction of personnel and closure in a certain establishment) shall apply to an industrial establishment (other than an establishment of a seasonal nature or in which the work is performed only intermittent) in which no less than three hundred workers, or a greater number of workers than can be notified by the corresponding government, were employed on average per working day in the previous twelve months ”.
In addition to this code, the minister also presented two others at Lok Sabha: the Safety, Health and Working Conditions Code, 2020 and the Social Security Code, 2020. Among others, the leaders of Congress, Manish Tewari and Shashi Tharoor, they opposed the introduction of the three bills.
Tewari noted that these three bills are fundamentally modified versions of their previous forms and urged the minister to withdraw them and conduct more extensive consultations before introducing them. These bills are also a blow to workers’ rights, he added.
Regarding the labor relations code, Tharoor said that it severely restricts the right of workers to strike and also allows state or central governments to amend the threshold of applicability related to layoffs and downsizing.
At Lok Sabha, Gangwar said that more than 29 labor laws have been merged into four codes and one of them has already been passed. Last year, Parliament passed the 2019 Wage Code Bill.
Gangwar noted that the government engaged in broader consultations on these bills with various stakeholders and that more than 6,000 comments were received online about the bills.
These bills were subsequently sent to a standing committee and 174 of its 233 recommendations were accepted, the minister said.
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