Defying the pressure from the labour unions, including RSS-backed Bharatiya Mazdoor Sangh (BMS), the Union government notified the category of 'fixed term employee' in the schedule attached to Industrial Establishment Standing Order's Act, 1946.
The argument is: This will allow flexibility to the corporate to employ and deploy labour only for a fixed duration, especially in the segments where they have specific orders or assignments. The corporate will have flexibility to not carry-over extra labour for lean seasons.
This is walking on thin edge. The labour and trade unions believe these changes have not only been made without consultation but also by circumventing the domestic laws and the India's commitments at international forums such as the International Labour Organisation (ILO).
Further, the unions believe this will kill the concept of permanent jobs in India. They fear all jobs will be converted into contractual work for a fixed period. The move is seen as a backdoor entry for the contentious 'hire and fire' norm in the private sector. In 2003, the then PM Atal Bihari Vajpayee's NDA government was the first one to try this. It led to fights between the NDA and the RSS affiliates, and these provisions were withdrawn during UPA-1 later.
Finance Minister Arun Jaitley, in his Budget speech, announced the fixed term employment will be implemented. Fumed over this, the labour and trade unions say this announcement violates the ILO Convention 144 - mandating tripartite consultation for the government with trade unions and other stakeholders - adopted in 1976.
"He violated the convention, subsequently ratified by the Indian Parliament, when he unilaterally declared the implantation," laments Saji Narayanan CK, President of the BMS. He, along with other trade unions like Hind Mazdoor Sabha, CITU, AITUC, etc, said the government didn't do proper consultation with the unions and took the decision in haste.
Now the BMS, upset with the BJP, has threatened the government with protests. After the Budget, the BMS had decided to boycott the Indian Labour Conference scheduled in February; PM Narendra Modi was suppose to address the meet. Sensing the anger, the labour ministry cancelled the event. BMS leaders said they were not consulted.
They think the government brought the decision through an executive order instead of referring it to Parliament or the Parliamentary Standing Committee on Labour. "This is a backdoor method of bureaucrats taking up the legislative power enjoyed by Parliament on the matters of national importance. The amendment has been introduced under pressure from a powerful Industrial lobby," Saji Narayanan said.
The NDA government is embroiled in a discourse of job creation and rural distress, and this is seen as a step to cut through. Initially, the government allowed these provisions in the labour intensive made-up sectors, apparel and food processing. Now, this will become a rule for the entire universe of the labour consumption.
"Since the provisions under the existing labour laws did not provide such flexibility, the industry had inhibitions in engaging extra labour to discharge timely commitments like export orders. The amendment will certainly remove this hurdle and employment generation will receive an impetus in the coming months," said FICCI President Rashesh Shah.
The unions say the executive order giving the same benefits of permanent employees to the fixed term employees should have been given to the contractual workers. This could be done by amending the Contract Labour Act. So the new amendment should have been made to the Contract Labour Act instead of the Standing Orders Act to stop the exploitation of contract workers, they opine. The government should withdraw the amendment, said Narayanan.