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'Ease of doing business will become ease of closing business'

Source: PTI
March 21, 2018 17:19 IST
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The BMS said that creating workers who do not own their industry and without permanent commitment or relationship with the industry, will be a hazard for industrial growth.

Illustration: Uttam Ghosh/Rediff.com

Rashtriya Swayamsevak Sangh-affiliate Bharatiya Mazdoor Sangh (BMS) on Wednesday criticised the government for extending fixed term employment to all sector, saying this will legalise hire and fire, while permanent jobs would vanish.

 

"Government should immediately withdraw the controversial new notification on 'fixed term employment' which extends it to all employments in the country," said Saji Narayanan C K, president, Bharatiya Mazdoor Sangh in a statement.

The BMS said that by this notification that amends the Industrial Employment (Standing Orders) Central Rules, 1946, permanent employment will vanish from the industrial sector and all jobs will be converted into temporary contract works for a fixed period only.

The union said, "It is also highly objectionable that a fixed term contract can be even cancelled by the employer unilaterally by giving only two weeks' notice. None of the objections raised by the BMS was accepted by the government. Hire and fire will become the legalised rule in the labour sector. There will not be any permanent relationship between worker and industry.”

Earlier this month, the government has amended the Industrial Employment (Standing Orders) Central Rules, 1946 to extend the facility of fixed term employment to all sectors. It was available for apparel manufacturing sector earlier.

The BMS said that creating workers who do not own their industry and without permanent commitment or relationship with the industry, will be a hazard for industrial growth.

Instead, the government should stop the increasing contractualisation in permanent jobs in the country, which is a demand of the joint trade unions.

Fixed term is a new system that replaces the middle man viz contractor in a contract employment.

Finance minister violated the ILO convention 144 on Trade Union Consultation, which was ratified by the Indian Parliament, when he unilaterally declared that the fixed term employment will be implemented, BMS alleged.

Even the government did not properly conduct several rounds of consultation with trade unions.

The amendment is brought in a hasty way.

The important amendment has been brought about by an executive order, without the matter being sent to parliament or being subjected to the scrutiny of a Parliamentary Standing Committee on Labour, it said.

This is a backdoor method of bureaucrats taking up the legislative power enjoyed by the parliament on matters of National importance.

The amendment is brought about under pressure from a powerful Industrial lobby. Studies in Europe have shown that fixed term employment has increased unemployment.

This was because employer can easily go for automation or employer can easily close business after a period.

"Ease of Doing Business" will become "Ease of Closing Business". Studies have shown that it reduces the incentive to invest in labour capital.

It can lead to more accidents because long experienced workers are not being engaged, the BMS said.

It further said that in 2003 the Vajpayee government brought fixed term employment. But the UPA government on seeing protests by trade unions, withdrew the controversial amendment.

But, again the present government has brought it to made-up sectors, apparel and food processing. Now, it is extended to all sectors.

The executive order giving same benefits of permanent employees to the fixed term employees should have been, instead, provided to the contract workers by amending the contract labour act which is a demand by the joint trade unions.

Hence the new amendment should have been made to the Contract Labour Act to stop exploitation of contract workers, instead of amending the Standing Orders Act.

Hence, government should withdraw the amendment, said Saji Narayanan C K in the statement.

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