Assocham For Rationalising Labour Laws

Associated Chambers of Commerce & Industry (Assocham) has emphasised the need to rationalise the multifarious labour laws in the country to impart flexibility and improve employment opportunities.

The chamber has said in a statement that some provisions of the Industrial Disputes Act make it difficult for industry to go in for modernisation and upgradation and also constrain restructuring of sick industrial units.

It has stated that despite the emphasis on worker protection and social welfare in the legislation, India has achieved limited success in increasing either employment or real earnings per employee. A protected economic environment, backed by antiquated labour laws and slow judicial process, has been a major cause for undesirable substitution of cheap labour by expensive capital. This, says Assocham, explains the present situation in which employment in the organised industrial sector has shrunk despite massive investment over the past decade, forcing a number of economic activities to the informal sector, where the terms and conditions of employment are not comparable to those in the organised sector. At the same time, distortion in the labour market has, to a large extent, contributed towards making India technologically obsolescent and non-competitive both in the domestic and foreign markets.