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Wednesday, July 06, 2022

Explained: What Haryana’s move to reserve 75% private jobs means for companies

A look at the Haryana State Employment of Local Candidates Bill, 2020, its provisions that may not go down well with the private sector and whether it can be legally challenged.

Written by Varinder Bhatia , Edited by Explained Desk | Chandigarh |
Updated: March 2, 2021 10:10:49 pm
Haryana Chief Minister Manohar Lal Khattar

On the lines of Andhra Pradesh government, Haryana too has announced it wants 75 per cent of private sector jobs in the state, till a certain salary slab, reserved for local candidates. In November 2020, the state Assembly passed the Haryana State Employment of Local Candidates Bill, 2020 paving way for more employment opportunities for locals in the private sector. On March 2, the Governor gave his assent to the Bill.

Here is a look at the Bill, its provisions that may not go down well with the private sector and whether it can be legally challenged.

Which sectors will be covered under this Bill?

All the companies, societies, trusts, limited liability partnership firms, partnership firms and any person employing 10 or more persons and an entity, as may be notified by the government from time to time shall come under the ambit of this Act. The definition of “employer” given in the Bill means a Company registered under the Companies Act, 2013 (Central Act 18 of 2013) or a Society registered under the Haryana Registration and Regulation of Societies Act, 2012 or a Limited Liability Partnership Firm as defined under the Limited Liability Partnership Act, 2008 (Central Act 6 of 2009) or a Trust defined under the Indian Trust Act, 1882 or a Partnership Firm as defined under Indian Partnership Act, 1932 or any person employing 10 or more persons on salary, wages or other remuneration for the purpose of manufacturing or providing any service or such entity, as may be notified by the government from time to time. It shall not include the central government or state government or any organisation owned by the central or state government. 📣 Express Explained is now on Telegram

What does the “local candidate” mean?

A candidate “who is domiciled in State of Haryana” is called a local candidate and shall be able to avail the benefit of this reservation while seeking employment in private sector. The candidate will also mandatorily have to register himself/herself on a designated portal while seeking benefit under this reservation. Employer too will have to make recruitments through this portal, only.

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Does it mean 75% of total work force of an employer will be from Haryana only?

No. Every employer shall be required to employ 75 per cent local candidates for the posts where the gross monthly salary or wages are not more than Rs. 50,000 or as notified by the government from time to time. The local candidates may be from any district of Haryana, but the employer shall have the discretion to restrict employment of local candidates from any district to 10 per cent of the total number of local candidates. It will, however, be also the employer’s discretion if he wants to recruit above 10 per cent employees from a particular district.

Can an employer also claim exemption from this 75% recruitment restriction?

Yes, but only after going through a long procedure and only if the government-appointed officers believe that the employer’s request seeking exemption holds merit. The employer may claim exemption where adequate number of local candidates of a desired skill, qualification or proficiency are not available. The employer will have to apply to a Designated Officer (an officer not below the rank of a Deputy Commissioner), in a particular format (to be drafted later). The Designated Officer shall hold an inquiry and evaluate the attempt made by the employer to recruit local candidates of the desired skill, qualification or proficiency. The Designated Officer may accept/ reject the claim of the employer seeking exemption. The Designated Officer may also direct the employer to train local candidates to achieve the desired skill, qualification or proficiency.

How will the government check if employers are abiding by 75% reservation rule?

Every employer will have to furnish a quarterly report on the designated portal and mention details about local candidates employed and appointed during that period. The reports furnished by the employer will be scrutinised by the authorised officers not below the rank of Sub-Divisional Officers. These officers shall have the powers to call for any record, information or document in possession of any employer for the purposes of verifying the report furnished by them. The officer will also have the right to enter the employer’s work premises to examine any record, register, document if the officer has a reason to believe that the employer has committed an offence under this Act or the rules made thereunder.

Will the employer be penalised for not following provisions of this Act?

Yes, the employer can be fined with a minimum Rs. 10,000 to a maximum Rs. 2 lakh once it is established that the employer has committed a violation of provisions of the Act. If the employer continues to commit the violation even after conviction, a penalty of Rs. 1,000 per day till the violation continues shall be imposed. A penalty of Rs. 50,000 shall be levied on the employer who produces false records or counterfeits or knowingly makes/ produces a false statement. The penalty, on a subsequent offence, shall not be less than Rs. 2 lakh but may even extend to Rs. 5 lakh.

Who all can be held liable if an employer does not adhere to provisions of this Act?

When a company commits an offence under this Act, every Director, Manager, Secretary, Agent or other officers or person concerned with the management shall be deemed guilty of the offence, unless he/she proves that the offence was committed without his knowledge or consent. In case of an offence committed by limited liability partnership firm – all the partners/ designated partners shall be held guilty of the offence. In case of offence committed by a Society or Trust – every person who was in charge at the time of commission of offence, or the person who was responsible for conduct of the business of the society at the time of commission of offence shall be deemed guilty of the offence. If it is proved that the offence was committed with the consent or connivance of any Director, Manager, Secretary, Trustee or other officer of the society or trust, all of them shall be deemed guilty. No court shall take cognisance of any offence punishable under this Act unless a complaint is made within six months of the date on which the commission of offence came to the knowledge of authorised or designated officer.

Why is Industry not impressed with the move?

Several top industrialists in Haryana have time and again apprised the concerned authorities and government functionaries that the move of restricting employment for Haryana’s candidates may not be in the interest of industry. JJP MLA Ram Kumar Gautam strongly objected against the Bill in Vidhan Sabha on Thursday and even called it “absolutely ridiculous legislation” that is “100 per cent wrong”. Gautam raised apprehensions that if Haryana implements this kind of a reservation, other states will also follow the same and that shall result in a “complete chaos”.

Is this reservation Bill violative of Article 16 of the Constitution of India?

Andhra Pradesh’s decision of introducing 75 per cent reservation for local candidates was challenged in the Andhra Pradesh High Court which observed that “it may be unconstitutional”. The Andhra Pradesh High Court had asked state government to inform if the quota-law was enacted as per the Constitution. Similar concerns were raised in Haryana Vidhan Sabha by Congress legislator BB Batra, who called the Bill a violation of Article 16 of the Constitution of India. However, Haryana government claims that while Article 16 talks about the “public employment”, the Bill only pertains to “private sector employment”.

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