Big labour reforms across the country are just a signature away. The central government has cleared the various changes made to its laws by the Rajasthan government, and these were sent to President Pranab Mukherjee for his signature on Tuesday. He is expected to sign on within a few days.
Once this is done, other states are expected to follow suit. Madhya Pradesh has already started the process of making similar changes along the lines that Rajasthan has.
While Rajasthan had sent its labour law changes to the Centre some months ago, a mandatory process of consultation with various ministries is required. Once this was over, the home ministry sent the Rajasthan law to the President.
Rajasthan has made three sets of changes to the Factories Act, the Industrial Disputes Act and the Contract Labour Act. Under the changes, government permission will not be required for retrenchment of workers if the factory has 300 workers — this is 100 right now.
Similarly, trade unions will need to represent at least 30% of workers in order to be recognised — this is 15% right now. And in the case of the Factories Act, it is to be applicable only to firms that have more than 20 workers as opposed to 10 right now.
Under Article 252(2), even if the state law runs counter to the central law, the President’s assent ensures the state law prevails. So, once President Mukherjee signs on to Rajasthan’s laws, other states like Madhya Pradesh are expected to rush in their laws as well.