Dear All
The topic ‘Does India require faster Labour Law Reforms ” is a much debated topic at every Global and Indian Contract Staffing Forum.
Recently in the October 2012 in the Annual conference of the Indian staffing Federation in their Indian Staffing Industry Research Paper 2012 the items where specific reforms are required has been outlined .In fact the need for adopting the The Private Employment Agency Convention of International Labour Organisation (Convention No. 181 of 1997) was raised in the same document. By adopting the The Private Employment Agency Convention of International Labour Organisation (Convention No. 181 of 1997) it will be a step forward in giving Statutory recognition to the Contract Staffing Industry .
Adapting and adopting Indian Laws to International Conventions has been an ongoing process .It is a simple legislative process .But adopting The Private Employment Agency Convention of International Labour Organisation (Convention No. 181 of 1997) will have serious resistance from the Trade Unions.
Everyone echoes that India should follow the China example in Economic reforms and the path of globalization .Then without waiting for the adoption of The Private Employment Agency Convention of International Labour Organisation (Convention No. 181 of 1997) we can just replicate the Labor Contract Law (LCL) which was enacted by the Chinese Parliament during 2008.The Chinese Political system modeled on the socialist pattern has enacted a Labor Contract Law (LCL) and adopting a similar one in India may not be difficult for the Government to convince the Trade Unions . The Trade Unions will support the move as it contains many pro-labour provisions and provides better bargaining strength for the Unions .
The further reason for the delay for India to implement the reforms in the Labour Law sphere is due to the fact that changes in Laws are to be brought about by the Centre for the Central acts and the respective State Governments for the State laws.This is a time consuming process. Before making any change the stake holders have to be consulted. It is a long drawn process .It would be better to start the process by enacting a similar law as done in China .For enacting this law the Contract Labour (Regulation & Abolition ) Act has to be either amended suitably or a New law enacted on the Chinese model .
Who can be the movers for enacting the Indian Labor Contract Law (ILCL).Definitely it will be the Business Associations and each of the Indian Staffing companies in India need to move the Government to enact a special law. The Association and Federations of Employers can take up this cause as they are the ultimate Principal Employers who will employ the Contract Labour.
To narrate the history when the Chinese Law was enacted the Chinese legislature during March 2006 launched the public consultation process for its draft Labor Contract Law. By April the legislators received 191,849 responses, a majority of them from workers. Meanwhile, foreign investors and commercial groups also studied the draft law and submitted their comments. The process included recommendations from the following bodies:
European Union Chamber of Commerce in China (EUCCC)
American Chamber of Commerce in Shanghai (ACCS)
U.S China Business Council
The first two largest foreign investors’ organizations in China and both of them submitted recommendations and opinion papers on the Draft Labour Contract Law to the Legal Affairs Committee of the Standing Committee of the National People's Congress.ACCS is said to represent over 1,300 corporations, including 150 Fortune 500 companies and the big names include Dell, Ford, General Electric, Microsoft and Nike. EUCCC in China represents more than 860 members. The U.S.-China Business Council represents 250 U.S. companies doing business across all sectors in China.
In India the Trade Unions have more stakes in Labour Law legislative process more than the Industry or its Association and Forum. Therefore the whole legislative process hinges on Trade Union acceptance /consent. The Association Federation would need invite the Top Trade Union Leaders of the Country for a dialogue on a Draft Labour Contract Law to be drafted by the Federation .This needs to be done on an emergent basis
Until the reforms are implemented Staffing business in India have to operate within the existing parameters of labour laws. The Business and legal team of every Staffing Company would need to tune operations to the existing provisions and help the business team to operate in an optimum manner within the prevalent labour law frame work without incurring additional cost till the reforms are implemented. This is where the success of any Staffing entity is.
With Regards
V.Sounder Rajan
Advocate -Labour & HR & Consumer Law Consultant -Chennai
Legal Consultant for Indian Staffing & Recruiting Industry
