MUMBAI: The Opposition Congress-NCP and trade unions have opposed the state government’s push to amend the law to make industrial closures and sackings easier. If the labour reform goes through, 96% of factories in the state will not need prior government permission before shutting down or laying off workers.
The amendment to the Industrial Disputes Act 1947 has been cleared by a cabinet subcommittee and will be tabled before the cabinet next week. Currently, industrial units with less than 100 workers can shut down and retrench workers without seeking government clearances. The amendment extends the waiver to units with less than 300 workers, as has been done in BJPruled Rajasthan and Haryana.
Once cleared by the cabinet, the amendment needs to be passed by the state legislature. Since this is a Central law, the reform will also need the approval of the President. The state government says the reform will boost the ease of business and encourage the hiring of permanent workers.
The Congress and the NCP said they would oppose the reform in the state legislature. “This reform will hit workers who have already been impacted by demonetization. The government claims labour reforms will improve investment but that has not happened,” said Congress leader Radhakrishna Vikhe Patil. “We will be opposing this in the assembly,” said NCP spokesperson Nawab Malik.
Trade unions, including the RSS-affiliated Bharatiya Mazdoor Sangh and the Shiv Sena’s Bharatiya Kamgar Sena, say they were not consulted by the government and will oppose the reform. “Even if our ministers support this reform in the cabinet, we will go against them. We will ask our MLAs to oppose this in the assembly,” said Suryakant Mahadik of the Bharatiya Kamgar Sena.
The Bharatiya Mazdoor Sangh (BMS) also said it will try and get the reform stalled. “This will lead to mass retrenchments as is happening in the IT industry. As it is, most hiring is contractual,” said P J Banasure of BMS. “There will be a backlash from workers to this change which is why only Rajasthan and Haryana have made this amendment so far. Even Gujarat has not moved towards this,” he added.
Maharashtra has 37,234 factories with 25.16 lakh employees. Currently, 32,443 factories accounting for 87% of the total, have less than 100 workers and do not need government permission for closures and retrenchments. If this reform goes through, 3,426 factories will be added to the exempted list, taking the total to 96% of the state’s units.