Just train for 6 months, get full labour flexibility

Written by Raj Kumar Ray | New Delhi | Updated: Aug 5 2014, 05:46am hrs
Labour-intensive industries that currently cannot hire workers seasonally and are looking for skilled workers will get a shot in the arm as a new policy is likely to facilitate both. The Union labour ministry has proposed that India Inc piggyback on a clutch of government-run skilling programmes in areas where demand for trained hands are the highest. The firms will have to absorb 80% of the workers trained under the schemes for a limited period of six months.

Industry hopes the move, which allows corporates to design the government schemes, could be transformational for Indias labour sector, which is fraught with a lot of rigidities. It is also in consonance with the Modi governments strategy of carrying out labour reforms in a piecemeal and need-based manner, without ruffling too many feathers.

As per a labour ministry note, reviewed by FE, a new window under the Craftsmen Training Scheme being run at industrial training institutes and the skill development initiative based on modular employable skills courses could be used by industry for training and hiring youth. The courses will be conducted in high-potential areas and industry or the employer will ensure a minimum of 80% of those trained get work for at least six months, the ministry said. The duration of the courses can be flexibly framed for one to two years or even shorter.

Such a move would address the shortage of skilled labour, especially in garment factories, as temporary workers are not allowed under the current law, an official source said. Even unskilled workers would be imparted training, he added.

DK Nair, secretary general of the Confederation of Indian Textile Industry, agreed, calling the initiative a game changer, adding that SME units in the sector would be the main beneficiary of the move.

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Availability of workers in general and trained workers in particular is one of the major challenges that the textiles sector is currently facing. We are already making use of some government schemes including the Integrated Skill Development Scheme of the ministry of textiles and the facilities of NSDC (National Skills Development Corporation), he said.

Recently, the Cabinet cleared a clutch of changes in the Apprentices Act to help manufacturing industries absorb freshers and amendments in the Factories Act to allow companies to scale up operations through extended hours of work. Separately, the government has amended a clause in the Mines Act to provide more flexibility to oil companies in deploying workers on and off oil blocks. As reported by FE earlier, there is also a move to extend the rural jobs scheme to the entire textile and garments sector, with the textile industry offering to train as well as employ workers under the scheme and pay them over and above the scheme wage given by the government.

As per the labour ministry plan, the courses designed by industry or the employer has to be approved by a subcommittee of the National Council for Vocational Training norms and courses and the company content can remain exclusive for 18 months. After 18 months, the courses if found satisfactory in terms of outcomes/placement shall be made public and anybody can take advantage of it, said a labour ministry official.

Industry has been shying away from training programmes fearing that the workers may join competing firms after acquiring the requisite skills. This has resulted in a surplus of unskilled workers even though many industries are grappling with a shortage of skilled manpower.

The labour ministrys new MoU scheme with industry for training of workers is indeed welcome and shows the governments pragmatic approach in bringing industry and training institutions together to quickly meet the skilled manpower requirement of industry in a fast changing business environment. Such collaboration will not only benefit industry but lead to job acceleration, said Chandrajit Banerjee, director general, Confederation of Indian Industry.

However, some experts said the scheme could have been more flexible. Rather than make it mandatory for the units to take 80% of the output and provide them minimum of six months employment, the employers could be given the first right of refusal in engaging those who successfully complete the training programme, said Rituparna Chakraborty, president, Indian Staffing Federation and co-founder, TeamLease. The policy would have broader impact if private vocational training institutes, colleges, universities could also be allowed to sign similar MoUs.