Private sector job quota: Exemptions to water down law fail to enthuse industry captains

Private sector job quota: Exemptions to water down law fail to enthuse industry captains


Sensing a backlash from the industry, the Haryana government has tried to water down the controversial 75% private sector job reservation law by granting certain exemptions to employers in the hirings.

However, entrepreneurs, particularly those running micro-small and medium enterprises (MSMEs), look less than pleased.

The private sector job quota law which came into effect from January 15 makes it mandatory for the companies and industrial establishments to hire 75% local candidates who have a domicile certificate for jobs having a gross monthly salary of 30,000 or less from now on. The law has been termed regressive by India Inc.

The state government tried to placate the industry by bringing down the upper limit of gross monthly salary to 30,000 from 50,000 for jobs under the ambit of private sector job quota law.

Who all are exempted

A set of exemptions were ordered on January 17 by the state government to mollify the industry. These included exempting start-ups, and information technology (IT) and IT-enabled services, which come into being after January 15 from local hirings for two years, short-term employment of less than 45 days, vacancies under employers who engage in agricultural activities such as growing and harvesting of crops, fruits, vegetables, nuts, seeds, tea, coffee, raising animals, fish farming, and vacancies under an employer for domestic work or services in residential homes.

In-house placements within state exempted

The state government has also ordered those vacancies being filled up through promotion or transfer or by absorption of surplus staff of any unit of the same employer in the state will be exempted from the local hiring.

However, there is no clarity on in-house placements from outside Haryana. Besides, any class, post, skill and category of employment where local candidates of the desired skill, qualification or proficiency are not available will also be exempted.

What’s not exempted

Agriculture-allied activities involving manufacturing, trading, processing of agricultural products or produce, however, have not been exempted.

Also, agriculture-allied activities covered under the definition of establishment (a shop or commercial establishment) under Section 2 (viii) of the Haryana Shops and Commercial Act or factory as defined under Section 2 (m) of the Factories Act have not been exempted.

Trade captains not entirely convinced

Industry captains and entrepreneurs, however, do not sound entirely pleased with the exemptions. PK Jain, former president of the PHD Chamber of Commerce and founder president of Gurgaon Chamber of Commerce, said big players will not be much affected by the job reservation law but the MSMEs will suffer.

“The state government should consider exempting MSMEs from the ambit of the law. The government has exempted new start-ups and IT units. Health of the MSME sector which is driver of the state’s economy is in a pretty bad shape because of the pandemic situation,” Jain said.

Gurgaon Industrial Association (GIA) chairman Jagan Nath Mangla said they have challenged the private job quota law in courts. “How well these exemptions will help the industrial sector will be known only with the passage of time,” Mangla said.

Though, he admitted that reducing the monthly salary cap for new hirings to 30,000 is a welcome move.

Many industrialists who did not wish to be named said they are anticipating multiple problems due to enactment of the job quota law.

“I have been in the manufacturing trade for more than 20 years and know well that there is a dearth of semi-skilled and skilled manpower in Haryana. Why would we hire workers from Uttar Pradesh and Bihar if local manpower is available,” said a Gurugram-based industrialist.

A Sonepat-based entrepreneur said their experience with the local hirings has been quite disappointing.

“I do not see many local youngsters coming forward to work in factories. Haryana youth is only interested in government jobs. People choose to remain idle and wait for a government job rather than toil in a factory. Is the government doing enough to make people meaningfully skilled to cater to the requirement of the industry?” he said.



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