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May 8, 2020

Four State Govt suspend & amend labour laws exempting businesses from compliance

by facelesscompliance in Compliance Law

Four State Govt suspends & amend labour laws exempting businesses from compliance

UP, MP, Punjab, Gujarat & other States make these changes in Labor Laws

The coronavirus-led crisis in India has made many states to ease labour laws in order to give a fillip to the economy and attract more investment. After Madhya Pradesh CM Shivraj Singh Chouhan announced relaxation in its labour laws, Yogi Adityanath’s Uttar Pradesh government has come up with a mega amendment in its labour laws

All other Acts including Industrial Disputes Act, Factories Act, Trade Union Act etc. will not be in vogue for next three years. Uttar Pradesh (UP) government has formulated and cleared an ordinance that suspends most of the labor laws for a period of three years. The decision has been taken to revive the state’s economy that has been disrupted due to the coronavirus-mandated lockdown by luring industrialists, as per media reports

It has become a necessity to provide temporary reprieve from labour laws for new industrial investment, for establishing new industries, and for existing industries in the current situation, the state government said

The state cabinet has cleared the “Uttar Pradesh Temporary Exemption from Certain Labour Laws Ordinance, 2020″ to exempt all establishments, factories and businesses from the purview of all, but three labour laws and a section of another act, a statement of the UP government said.

The MP state has also issued an ordinance to the Madhya Pradesh Labour Welfare Fund Act, 1982, exempting all newly established factories from filing annual returns and paying Rs 80 per labourer per year to the Madhya Pradesh Labour Welfare Board for next 1,000 days. Changes to the Madhya Pradesh Industrial Employment (Standing Orders) Act, 1961 will exempt industries employing up to 100 workers from the law’s provisions.

The move is likely to invite wider criticism as it will give a free hand to businesses to operate the way they wish and boost hire and fire rules at a time job security and wage security issues are facing a bigger challenge.

With this the state will have three active laws — Building and Other Construction Workers Act, 1996, Workmen Compensation Act, 1923, Bonded Labour Act, 1976 and Section 5 of the Payment of Wages Act, 1936. The section 5 of the payment of wages act relates to the right to receive timely wages by employees.

Rajasthan Govt , Apart from raising the working hours from 8 hours per day to 12 hours per day, the state has amended Industrial Disputes Act to increase the threshold for lay-offs and retrenchment to 300 from 100 earlier. In order to recognise the trade union, the threshold membership of the trade union has been increased from 15 per cent to 30 per cent.

Punjab, Himachal Pradesh and Gujarat: These three states have also amended their Factories Acts in the last month to increase the work time to 12 hours every day and 72 hours every week, compared to 8 hours every day and 48 hours every week.

Is Central Government Approval required? Labour is a Concurrent subject. Therefore, both centre and state governments shall frame their own laws. However, approval of central government is required. The UP Government, & other States has therefore, sent the ordinance for the approval of the central government.

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