OECD to India: Provide social, labour protection to workers irrespective of status, size, activity of firms

The report, “OECD Economic Surveys: India 2014”, said that there are “multitude of labour law”s are not only inconsistent but are creating “confusion and uncertainty and raise labour costs”, the report says, some companies are not even aware of their precise obligations” leading to a situation where what may appear to be non-compliance actually open “the door to corruption by labour department inspectors.”
Particularly referring to what it called “employment protection legislation (EPL)”, the report states, the protection is particularly high for “regular employment … in industrial establishments with more than 100 workers, largely because industrial firms are required to obtain prior government permission to dismiss one or more workers.”
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India's labour laws are more restrictive than most countries: OECD |
In 2014, the new government introduced Bills for “amendment in the Factories Act and Apprenticeship Act” and is considering to introduce “a single window – a website – to help businesses meet compliance requirements for various labour laws”, OECD said, adding, “The new system would also make labour inspections more transparent by using a random computerised method and the redressal of grievances more effective.”
But there is uncertainty in the country, it insisted. “At the state level, there is considerable variation in the implementation of the provision of the Industrial Dispute Act (IDA) which requires government permission for layoff and retrenchment of workers and closures of industrial establishments.”
“Some states (e.g. Maharashtra and Gujarat) do not apply the EPL as contained in the Industrial Dispute Act (IDA) and several states have exempted selected industries and sectors from its application. In contrast, others (e.g.West Bengal) have made the IDA more restrictive”, it said.
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