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Labour reforms to end ‘inspector raj’
PM spells out plan to simplify rules for industry and spur employment, growth
Sanjeev Sharma
Tribune News Service

What these steps mean

Steps taken include rationalising 16 labour laws into a single form

These measures are likely to enhance the ease of doing business and reduce harassment from inspectors

These will encourage more small and medium enterprises (SMEs), thereby promoting manufacturing

The thrust is on making rules simpler, making execution better and providing “maximum governance”

Part of 'Make in India' vision: PM

The PM said the "Shramev Jayate" initiatives were an essential element of the "Make in India" vision

They would pave the way for skill development of youth in a big way

New Delhi, October 16
Prime Minister Narendra Modi today initiated what is considered as one of the toughest reforms linked to labour laws. The set of measures included ending ‘inspector raj’, rationalising 16 labour laws into a single form, and promising to return unclaimed funds of Rs 27,000 crore lying in the Employees Provident Fund (EPF) to workers who will also have the advantage of portability of PF accounts.

Launching the labour reforms package under 'Shramev Jayate' programme, the government is starting on these reforms in a way that does not require legislative changes but can be pushed through as executive decisions. Also, the thrust is on making rules simpler, making execution better and providing “maximum governance” in the words of the Prime Minister.

From the industry’s standpoint, these measures are likely to enhance the ease of doing business, reduce harassment from inspectors, encourage more small and medium enterprises (SMEs) and reduce the compliance burden thereby promoting manufacturing and economic activity in the country.

Modi announced that the newly launched 'Shram Suvidha Portal' has simplified compliance of 16 labour laws through a single online form.

He said transparent Labour Inspection Scheme for random selection of units for inspection by computer would end undue harassment of the ‘inspector raj,’ while ensuring better compliance.

The Prime Minister expressed his concern that as much as Rs 27,000 crore was lying unclaimed with the Employees Provident Fund Organization (EPFO). He said this money belonged to poor workers of India, and the portability provided for Employees Provident Fund through the Universal Account Number would put an end to such money being locked up and not reaching the intended beneficiary.

The 'Apprentice Protsahan Yojana' and the Effective Implementation of revamped 'Rashtriya Swasthya Bima Yojana' (RSBY) for labour in the unorganized sector were also launched.

The Prime Minister said the "Shramev Jayate" initiatives were an essential element of the 'Make in India' vision as they would pave the way for skill development of youth in a big way.

The government earlier piloted three Bills to amend the Factories Act, Apprentices Act and Labour Laws (Exemption from Furnishing Returns & Maintaining Registers by Certain Establishments) Act, 1988.

The more radical reforms in labour would involve giving the industry freedom to hire and fire. "Finally, industry expects more radical changes such as removing government intervention in restructuring or right sizing of industry, which would create employment faster by redeploying resources", industry body Ficci said.

The CII said the long-awaited amendment to the Apprentice Act would enable industry to scale up the number of apprentices from three lakh to around 23 lakh thereby leading to large employment and creation of a skills talent pool for industry.

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