Haryana State Employment of Local Candidates Act, 2020

• 08 Nov 2021

Why in News

Recently, the Haryana Government has said that the Employment of Local Candidates Act, 2020 will be implemented in the state from 15^th January 2022.

Key Points

• About the Law:
  
  • It requires firms with 10 or more employees to reserve 75% of all jobs offering a salary of less than Rs. 30,000 a month for eligible candidates of State domicile.
    
    • Jobs will be provided in various companies, societies, trusts, and limited liability partnership firms situated in the state.
  • The move is aimed at disallowing the influx of talent from other parts of the country even in sectors like IT and IT-enabled services (ITes), which the State does not have enough captive supply of.
  • The law will be applicable for a period of 10 years.
  • The state government also relaxed the residency (domicile) requirement from 15 to 5 years for a person to get a bona fide resident certificate in the state to provide some flexibility to the private companies in hiring.
  • It will be mandatory for all these employers to register all their employees drawing gross monthly salary or wages not more than Rs 30,000 on the designated portal available on the official website of the Labour Department, Haryana.
  • Violation of any provision of this Act will be a punishable offence.
• Concerns:
  
  • Can Trigger Exodus of Investors:
    
    • It could trigger an exodus of large domestic and multinational investors across sectors such as auto, IT that rely on highly skilled manpower.
  • Affect Existing Industries:
    
    • Raising the son of the soil issue and preventing free movement of manpower resources in the State from other regions can have an adverse effect on the existing industries in the State.
      
      • This may force those tech giants and other industries to shift their base from Haryana to other States and drain out the State’s monetary resources to that extent.
  • Can Cause Extreme Talent Crunch:
    
    • Moreover, imposing the reservations on gig and platform companies could create a crippling talent crunch.
  • Against the Constitution:
    
    • The Constitution of India guarantees freedom of movement and consequently employment within India through several provisions.
      
      • Article 14 provides for equality before law irrespective of place of birth.
      • Article 15 guards against discrimination based on place of birth.
      • Article 16 guarantees no birthplace-based discrimination in public employment.
      • Article 19 ensures that citizens can move freely throughout the territory of India.
• Other Such Attempts:
  • AAP (Political Party) chief has promised 80% reservations for locals in private jobs in poll-bound Goa and he made a similar promise for Uttarakhand too.
  • This follows in the footsteps of states like Haryana, Jharkhand, Maharashtra, Andhra and Madhya Pradesh that have already implemented or tried to implement similar populist policies.
• Reasons Behind Such Legislations:
  
  • Vote Bank Politics: Inter-state migrant workers (ISMW) constitute a sizeable “under-used or un-used” electorate as they often do not exercise voting rights. If these workers and potential migrants could be retained through Job For Locals Legislations (JRFL) and provided with jobs, the parties’ electoral causes will be served.
  • Economic Sluggishness: The native unemployment issue assumes relevance as joblessness has intensified in the context of shrinking government employment.
  • Increased Incomes and Talent: Job For Locals Legislations will not only retain talent but also incomes which otherwise will go to “other regions”.
  • Precondition for Land Acquisition: Farmers and villagers, who lose their land in the process of land acquisition for industries, keep such preconditions in which industries have to provide jobs to local youth.

Way Forward

• The Haryana government should consider lowering the original salary ceiling of Rs. 30,000 a month to Rs. 15,000 a month on a 'cost to company' basis and raise it in tandem with efforts to improve skill sets in the State. The reservation, if any, should begin from 20%-25% as technical and specialised skill sets will take time to inculcate among the State's youth.
• The best way to grow out of Job For Locals Legislations (JRFL) attempts of various state governments is to ensure economic recovery and provide enough job opportunities for youths with skill training and proper education as key focus areas, enabling the masses to compete in the free market.

Source: TH