ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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New Bill on Industrial Relations

Protecting Employers against Workers and Trade Unions

As part of its attempt to improve growth, the government has put forth the Labour Code on Industrial Relations Bill, which amalgamates the provisions of the Industrial Disputes Act and the Trade Union Act. In spite of some positive features, the bill's aversion to the rights of workers and trade unions is quite apparent. For instance, penalties are imposed on individual workers for illegal strikes, but for illegal lockouts, the fine is borne by a collective entity; this is but one of many unequal provisions.

Soon after the victory of the National Democratic Alliance (NDA) in the 2014 elections, there was euphoria in industry. After coming to power, the Prime Minister repeated in many forums that economic growth would be the main objective. This would boost industry and commerce, which, in turn, would increase employment. Labour would get the spillover benefits of high growth. At the same time, the government stressed that there were too many laws regulating work (read, granting protection to labour) and that they needed to be changed. Rajasthan, led by Chief Minister Vasundhara Raje Scindia, took the lead by announcing that laws relating to labour protection and firing of workers had to become more liberal to generate more employment. The state legislative assembly resolved in July 2014 that laws such as the Factories Act, Industrial Disputes Act (ID Act), and Contract Labour (Regulation and Abolition) Act should be amended to release employers from their stranglehold and increase investment in industry, creating more jobs.

The argument that removing legal protection for labour and allowing industries to shut down at will, will increase employment is not new or even original. The World Bank’s World Development Report for 1995, noted,

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