Implementing labour reforms may prove tricky for new coalition govt

While the four labour codes have already been passed by the Parliament, implementing them could prove tricky for the new coalition government led by prime minister Narendra Modi

The labour and employment ministry and the ministry of skill development and entrepreneurship will need to usher in labour law reforms, job creation, upskilling, and promote social security for the workforce to give a fillip to India’s manufacturing competitiveness, said experts. 

While the four labour codes have already been passed by parliament, implementing them could prove tricky for the new coalition government led by Prime Minister Narendra Modi. They feel that the government may face opposition from various stakeholders, including a few state governments. 

Last Wednesday, credit rating agencies Fitch and Moody’s had said passing labour reforms may prove difficult for the 

coalition government.

“Passing contentious reforms could prove more difficult, particularly around land and labour. These have recently been flagged as priorities by the BJP to boost India’s manufacturing competitiveness,” Jeremy Zook, director and primary sovereign analyst for India at Fitch Ratings said.

Meanwhile, skilling millions of youths as a means to kickstart job creation needs to be brought into focus. This comes as the rapidly changing job landscape and the technological advances disrupt various roles. 

As the government looks to launch the revamped National Career Service (NCS) portal for jobs, Ramesh Alluri Reddy, chief executive officer (CEO), TeamLease Degree Apprenticeship said policies related to job creation and skill development will remain the top priority of the new government. This comes as significant strides have been made in manufacturing — especially semiconductors, pharma, electronics, auto, infrastructure and engineering.

“To fulfil the ambitions of our youth and businesses, scaling up apprenticeship participation to 20 million is not just a pipe dream, but a necessity. This involves simplifying the current apprenticeship system, building higher education linkage via the Tripartite Model (academia-youth-industry), developing an apprenticeship credit framework integrated with the formal education system and driving apprenticeship adoption by micro, small and medium enterprises (MSMEs) to name a few,” he added.

Along with job creation, the new government may focus on preparing a universal social security architecture to provide necessary protection for the workers across the country. This is because contractualisation and informalisation of the workforce is gaining pace across industries. 

“Post Covid, workers are finding it difficult to manage their household expenses due to the rising inflation and depleted incomes. Many times, they end up burning their savings due to the lack of any social security system. It is important that the new government focuses on increasing the basic facilities like health, education, and increasing the pension net,” said 

D Ramachander Rao, president, Singareni Retired Employees Association. 

To achieve universal social security, completing the integration of the e-Shram portal with different ministries and schemes will prove to be a game changer for the government.

E-shram portal, which has nearly 300 million unorganised registered workers, will allow access to various facilities from this single source.