Cabinet decides to bring in more Flexibility in Labour Laws to increase Productivity

The Union Cabinet chaired by Hon'ble Prime Minister Shri Narendra Modi has announced a set of measures that would bring in more flexibility in labour laws in the textile and apparel sector. These measures form a part of the special package announced by the Government today, for job creation & export promotion in the sector.

Following are the labour reform measures, announced by the Government:

Increasing overtime caps

Overtime hours for workers will not be allowed to exceed 8 hours per week in line with ILO norms. This shall lead to increased earnings for the workers.

Introduction of fixed term employment

Considering the seasonal nature of the industry, fixed term employment will be introduced for the garment sector. A fixed term workman will be considered at par with permanent workman in terms of working hours, wages, allowanced and other statutory dues.

Employee Provident Fund Scheme Reforms

EPF will be made optional for employees earning less than Rs. 15,000 per month. This will leave more money in the hands of the workers and also promote employment in the formal sector.

Impact in Three Years

This is expected to yield the following impact in three years:

Increase in exports by 1.4 billion US$

increase in employment by 1.75 lakhs

increase in investment by 4.2 billion US$

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