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Proposal to allow contract labour in selected industries under study

By Our Special Correspondent

CHENNAI DEC. 6. "The Union Government is considering a proposal to exempt a select list of 13 industries/activities from the law on abolition of contract labour," the Secretary to the Union Labour Ministry, P.D. Shenoy, said here today.

Establishments such as security services, cleaning, canteen, repair/maintenance, hospitals, education, information technology-related services, housekeeping and units in Special Economic Zones (SEZs) were being considered for such an exemption, which was being thought of as an alternative to exempting "non-core" functions in any enterprise from prohibition of employment of contract labour as suggested by the Second National Commission on Labour (NCL-II), Dr. Shenoy said, addressing the Employers' Federation of Southern India (EFSI).

He said the Government had notified with effect from December 25, 2003, a scheme to provide insurance to those who emigrate for taking up employment abroad and faced risk of loss of job (cover for up to two years), illness and accident.

Making a distinction between "labour reform" and "labour law reform," he said the former was within the control of managements and was more relevant to increasing productivity and competitiveness. Development of human resources, suggestion schemes, business process reengineering, incentives for improved employee performance and many other options were available for employers, and they need not wait for changes in labour laws to acquire competitiveness in the context of globalisation. Also, nothing prevented managements from implementing "golden handshake" (voluntary retirement) schemes.

Dr. Shenoy said even the report of the First National Commission on Labour (1969), headed by Gajendragadkar, which was unanimous, had taken a long time to implement, and some recommendations still remained unimplemented. The report of the Second NCL (2002), which also had a dissenting note by a member, could not be expected to be implemented in a short time. "The job of building consensus will take time but is inevitable in a democracy," he said. He said collective bargaining on the basis of settlements and consensus was taking place in thousands of units, though the Industrial Disputes Act (IDA) did not even define collective bargaining. Regarding the problem of closure of establishments (Chapter VB of the IDA), he said that it covered only industries, plantations and mining, while many sectors such as banks, insurance, trading and IT, did not require permission for closure.

The Centre had in recent times given permission to close down establishments (under its purview) through "speaking orders" (viz., giving reasons for granting such permission) and States could follow its example.

R. Vishwanathan, veteran labour relations executive, wanted priority action on ending anomalies in the definition of workmen and freeing top management personnel from the obligation of an "occupier" of factory premises.

Many establishments such as Binny and Standard Motors had been closed down without obtaining permission from the State authorities as required under the law, he said.

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