States compete to bring in sweeping changes to labour laws, ‘competition to attract capital’, say analysts

States compete to bring in sweeping changes to labour laws, ‘competition to attract capital’, say analysts

With at least 10 states moving to amend their labour laws ahead of restarting economic activities post the COVID-19 lockdown, an overhaul in the central labour laws is being seen in the offing. It is learnt that most states are expected to move towards extended working hours and are likely to follow the model of suspension of labour laws like Uttar Pradesh and Madhya Pradesh, with the Centre according to the requisite backing for the changes following which it will move towards an overhaul of central labour laws as well. A blanket suspension of labour laws, as has been in the case of UP, however, may not find favour, with the Centre leaning towards putting caveats in order to protect the rights of bonded labour, children and women. While UP and MP have opted for a suspension of labour laws for 1,000 days, as many as ten states — including Rajasthan, Punjab, Odisha, Maharashtra, Himachal Pradesh, MP, Haryana, Assam and Gujarat — have allowed extension of working hours to 12 through issuance of orders under the Factories Act during the ongoing lockdown against the COVID-19 pandemic. While states like MP have taken a more nuanced approach, other such as UP and Gujarat have opted for a broader, more sweeping relaxation of the labour laws, leaving drafting loopholes that could see potential legal challenges in the days ahead. Madhya Pradesh has exempted employers from some obligations under various labour laws like Factories Act, Madhya Pradesh Industrial Relations Act and Industrial Disputes Act, and Contract Labour Act for ...
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