Meet to discuss exemption of SMEs from labour laws

The upcoming Indian Labour Conference on May 17,18 will discuss a proposal by the Ministry of Micro,Small and Medium Enterprises

The upcoming Indian Labour Conference on May 17,18 will discuss a proposal by the Ministry of Micro,Small and Medium Enterprises to exempt small and micro enterprises from the ambit of labour laws. The meet is organised by the Labour Ministry and is the biggest gathering employees and employers organisations. But the move has angered the trade unions.

The proposal reflects the view of the MSME sector that most the labour laws in the present form cannot be applied to the sector. The Labour Ministry has now included the issue in the agenda for discussion at the meet that will be inaugurated by Prime Minister Manmohan Singh.

The MSME has suggested that enterprises in the unorganised sector and MSEs employing 20-50 persons should be exempted. It wants only four laws: Minimum Wage Act,The Payment of Wages Act,The Employees State Insurance Act and The Employees Provident and Miscellaneous Provisions Act,1952,for the sector.

A new law will have to be enacted for providing such an exemption. The MSME argues that the existing labour laws have to be looked afresh to bring them in line with the needs of a growing economy,globalization and also the need to provide flexibility in employment and movement of labour.

The ministry wants relaxation in the Contract Labour Act,1970. It has argued that labour laws should be enforced with reduced penal provisions without undesirable discretionary powers in the hands of the inspectors and with better modalities for self-compliance by making it an incentive-based system.

Presently,there are 44 labour laws that deal with matters like wages,social security,labour welfare,occupational safety and health and industrial relations. Besides,there are a large number of labour laws under implementation in the states. While the Labour Ministry believes that specific requirements can be addressed by modifying the existing labour laws and procedures,trade unions are not willing to discuss the proposal.

Government believes that the labour inspectorate has to be abolished and be replaced by a system of self compliance. Most of them violate law and exploit workers. But the government has no answer to address exploitation of hapless employees working in the sector, BMS president Saji Narayanan C K said.