 "IT industry")
The information technology (IT) industry seems to disagree with the Karnataka IT Union’s (KITU’s) demand that the state government revoke the exemption given to the IT/ITeS sector from the Industrial Employment (Standing Orders) Act, 1946. According to the Act, industrial establishments with 50 or more workers are required to define and communicate to employees about the job conditions, such as working hours, attendance, leave procedures, and termination.
The IT and IT-enabled services sector (IT/ITes), which employs over 2 million workers in Karnataka, has secured exemptions from the Act on more than four occasions, the latest being on May 25, 2019, which is set to expire on May 25, 2024.
On March 16, a section of IT employees, under the banner of KITU, staged a protest in front of the labour commissioner’s office in Bengaluru to press for their views.
“KITU, the only registered union of IT/ITeS sector employees in Karnataka with a membership of more than 10,000, demanded the government not renew the exemption as employers were not complying with the four conditions imposed on them while granting exemption,” KITU said in a statement.
Binod Singh, founder and chief executive officer of Cross Identity, a global leader in identity and access management, said the Act was archaic, and modern businesses (IT or otherwise) should not be governed by them. “This Act was enacted a long time ago. Even the first line in the Act considers the legislation expedient, which means convenient and practical although possibly improper or immoral,” Singh said.
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While protest to reinstate the Act might seem like a response to mass layoffs in the industry, it is the nature of business, he said. “If a company is failing and wants to retain some hope of success, sometimes mass layoffs are necessary. Enforcing protection of jobs via government laws helps nobody. The company will fail if it is forced to comply with such backward laws and red tape,” Singh said.
V Balakrishnan, former board member at Infosys, said the IT industry was a sunrise sector and should be provided with growth opportunities while protecting the rights of employees.
“The industry needs flexible regulations if it has to compete globally. The startup industry requires flexibility. Too much regulation will cripple the industry and affect competitiveness. The need of the hour is for the government to continue with the exemption and enforce the conditions provided in the standing order Act, which largely protects the interests of employees,” he said.
A former C-level executive from a Bengaluru-based IT firm said most companies in the sector follow global best practices in human resources and should, therefore, be exempt from archaic labour laws. “We are a global industry with business across geographies and employees all over the world, so we should be exempted from the labour department’s ambit,” he said on condition of anonymity.
Some companies have urged the Karnataka labour ministry to have broad stakeholder discussions with labour union leaders and the IT sector to evaluate the potential consequences of withdrawing the exemption.
Vikas Sharma, founder and director of Hi-Com Networks, an internet services provider, suggested gradual implementation or transition periods to minimise any negative effects on businesses while also protecting workers’ rights. If IT/ITeS companies were to be brought under the labour law, the government can consider developing procedures for equitable and open hiring, Sharma said, calling for workers’ rights and fostering sustainable growth in the IT sector.
AT ODDS
According to the Act, industrial establishments with 50 or more employees in Karnataka are required to formally define the conditions of employment
IT and ITes sector has got exemptions from the Act on more than four occasions
IT union in the state wants the government to end exemption
Industry says it needs flexible regulations to be able to compete globally
Some firms seek discussions to evaluate the potential consequences of withdrawing the exemption
