Why in news?
- The Ministry of Labour and Employment recently notified fixed term employment for all sectors.
- It was through an amendment to the Industrial Employment (Standing Orders) Central Rules, 1946.
- Click here to know more on fixed term employment.
What are the highlights of the rules?
- A fixed term employment workman is engaged on the basis of a written contract of employment for a fixed period.
- The existing permanent workmen as on March 16, 2018 cannot be converted as fixed term employment thereafter.
- March 16 is the date of commencement of the amended rules.
- The notified rules provide for equal work hours, wages, allowances and other benefits as that of a permanent workman.
- These are along with all statutory benefits available to a permanent workman proportionately according to the period of service.
- This will be available even if the period of employment does not extend to the qualifying period of employment required in the statute.
- Fixed-term employees whose services are terminated on non-renewal of contract or on its expiry is not entitled to any notice or pay in lieu.
- No notice of termination of employment shall be necessary in the case of temporary workman.
- This is whether it is monthly rated, weekly rated or piece rated and probationers or badli workmen (appointed in the position of permanent workmen or temporarily absent probationers).
What are the expected benefits?
- The Cabinet had earlier approved fixed-term employment for specific sectors.
- Fixed-term employment for all sectors now will make it easier for companies to hire-and-fire workers.
- It will also reduce the role of middlemen and allow companies to hire workers based on seasonal trends.
- The industries will be empowered to employ people for a fixed duration for which they have orders or assignments.
- There will be no burden of carrying extra labour force during the lean season.
- The move is further expected to promote ‘ease of doing business’.
What are the concerns?
- Job creation - The move towards fixed-term employment will make it easier for companies to layoff workers.
- This could have a bearing upon job creation in the country.
- Notably, India’s unemployment rate is estimated to rise to 3.5% for 2018 from 3.4% estimated earlier.
- Labour laws - The consolidation exercise of 44 central labour laws into four major codes is still pending by the government.
- Trade Unions - Trade unions across the country have opposed the extension of fixed-term employment to all sectors.
- This is because the move could lead to a situation where only fixed-term jobs are created.
- There is a possibility that permanent employment would vanish from the industrial sector.
Source: The Hindu
