Centre may allow firms with up to 300 workers to terminate services without its permission
Presently, companies with less than 100 employees are allowed to terminate or hire workers without permission.
The Centre on Saturday tabled a bill in the Lok Sabha that proposes changes to industrial laws, including allowing firms with up to 300 employees to hire or sack their workers without seeking its approval. Presently, companies with less than 100 employees are allowed to terminate workers without permission.
Minister of Labour and Employment Santosh Kumar Gangwar introduced the Industrial Relations Code Bill, 2020 in the Lower House. He also introduced the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020.
The Centre has also proposed that only companies with over 300 workers be required to have a standing order, which defines the rules of conduct for industrial workers. The absence of a standing order will allow companies to frame arbitrary rules for workers.
The three bills introduced by the Centre seek to give more freedom to the states to amend labour laws. The bills were criticised by Congress MPs Manish Tewari and Shashi Tharoor. Tiwari said that the Centre should have discussed the bills with all stakeholders, since they had undergone “substantial transformation”, according to The Economic Times. Tharoor, meanwhile, said that the government should have given the house the mandatory two days to study the bills.
“The increase in the threshold for standing orders from the existing 100 to 300 is uncalled for and shows the government is very keen to give tremendous amount of flexibility to employers in terms of hiring and firing,” labour economist KR Shyam Sundar told The Indian Express. “Dismissal for alleged misconduct and retrenchment for economic reasons will be completely possible for all industrial establishments employing less than 300 workers. This is complete demolition of employment security.”
The government had introduced the Industrial Relation Code Bill 2019 in the Lok Sabha last year. A draft bill circulated by the labour ministry had also suggested that companies with up to 300 workers be allowed to fire workers without permission, PTI reported. The provision was criticised by trade unions and hence not included in the bill in 2019.
In April, the Parliamentary Standing Committee on Labour had also suggested the same. The labour ministry had cited Rajasthan’s example, saying that the state saw “an increase in employment and decrease in retrenchment” by raising the threshold.