Ever since NDA bagged the greatest Lok Sabha victory in recent times, markets have started to look up with great fervour. The promise of roping in foreign investment and boosting indigenous industries – election promises – were expectations that Prime Minister Narendra Modi had set for the nation. The growth and expansion of the economy seemed to be a dream that could be realized after all. With the passage of months, however, the enthusiasm of the economy has become evident. Key labour reforms that were necessary to spur the economic systems into overdrive were missing. A number of head honchos also mentioned the need for these reforms at the launch of Make in India campaign.
On 16th October, 2014, Modi unveiled the long awaited labour reforms at the Pt. Deendayal Upadhyay Shramev Jayate Karyakram, organized by the Union Labour Ministry. The Prime Minister inaugurated the programme which also included a one-day conference that was attended by the labour, health, employment, and vocational training ministers of the various Indian states. Modi chose this platform to launch the Shramev Jayate Karyakram – a series of labour-centric reforms that are intended to facilitate Make in India – the NDA government’s campaign that intends to convert India into a manufacturing hub.
In his address at the occasion, the Prime Minister said, “Shramev Jayate (labour is triumphant) has the same power as Satyamev Jayate (truth is triumphant) in the development of our nation.” He insisted that the problems of labour must be seen from the viewpoint of the workers (shramik) and not from the viewpoint of the industrialists.
Labour reforms have been a major demand in the past few weeks. Modi also met with a number of prospective investors who complained about India’s inflexible labour laws and low ease of business ranking. The Labour Ministry and the PMO have put together the Shramev Jayate Yojana in an effort to boost indigenous industries.
The Prime Minister announced the launch of a Unified Labour Portal, also known as the Shram Suvidha – the platform that enables the implementation of a transparent and universally accessible information system to manage the Labour Inspection Scheme. The system shall put an end to the ‘inspector raj’ which has hounded the industries and held the economy ransom. “Inspector Raj…we heard this since our childhood and we thought it is for policemen, only but then we realised it’s a lot more,” quipped the Prime Minister.
Another important reform that has been announced today is the raise in wage ceiling from Rs. 6,500 to Rs. 15,000 per month. This is likely to ensure that the EPF scheme covers the most vulnerable labour groups and they derive all the benefits that they deserve. The minimum pension scheme announced today will ensure that every labourer will receive a pension of at least Rs. 1,000 after superannuation.
The very basis for labour inspections will now be changed. The criteria for all inspections will be uniform and objectively formulated. Inspection lists will be computer generated and random to eliminate bias and will be compiled centrally. The results of all inspections need to be put up on the portal within 72 hours, making way for complete transparency.
This is a considerable change from the current system where units are chosen for inspection at the discretion of local inspectors. Inspection criteria are arbitrary and this allows inspectors to harass factory owners and employers for any real or imagined violations. Corruption and bribery are promoted by the previous system leaving the interests of the labourers unprotected.
The new inspection laws shall be sent out as text messages to almost 1,800 labour inspectors across the country apart from the official communication.
The introduction of the UAN (Universal Account Number) will now allow labourers in the organised sector to change employers without needing to apply for PF transfer. It will also allow employees to view updated PF accounts from anywhere in the nation. Similarly, about 6 lakh to 7 lakh labour-intensive industrial units in the country are set to receive their unique Labour Identification Number, or LIN. The government is likely to take up an active role in promoting teh Industrial Training Institutes (ITIs) by felicitating some of the accomplished alumni.