Indian Staffing Federation (ISF) is seeking comprehensive labour law reforms to aide the growth of temporary staffing sector in the country. There are about 90 million contract-based temporary workforce currently in India and out of which a small number of 5 lakh people are engaged in organised sector enjoying the statutory labour welfare benefits. The radical labour law reforms could provide decent work, safe working conditions, social security to some 350 million unorganised workers who are not covered under labour and employment laws to receive any of the statutory labour welfare entitlements, a discussion paper by ISF, the umbrella body of the staffing companies, has said.
The temporary staffing companies are third party entities that act as bridge between workers and MNC companies in India. MNCs hire contract staff via temperory staffing agencies that receive fees from MNC clients for their manpower providing service. Temperory staffing companies also play the role of disbursing the salary to the workers.
The profile of contract staff in India varies from customer services, sales and customer prospecting, and telemarketing?accounts constituting 80% of the total temp workforce followed by technical functions staff like installation and commissioning, repairs and maintenance that make up for 15% of the deployment. About 3% to 4% of contract staff are deployed in the senior management positions including technical specialists and management experts. A growing industry, temporary staffing has added close 75,000 jobs during 2010-2011.
India has more than 100 labour laws, more than most other countries of the world, Moreover, there was considerable over-lapping of several statutory positions. For example there is a requirement of canteen, rest rooms, and first aid facilities not only in Factories Act 1948 but also in the Contract Labour (Regulation and abolition) Act, 1970 and the Inter State Migrant Workmen (Regulation of Employment and Conditions of Service) Act 1979. Lack of uniformity in coverage both to establishments and employed persons cause a lot of confusion. Variation in definition of words and expression used in labour laws add to this, the paper said.
In the social security laws of ESI Act 1948, and EPF &Miscellaneous Provisions(MP) Act 1952, which define employee in almost identical words, there is a marked difference in scope of the term ‘wages’ in these two acts. Under the EPF &MP Act 1952, PF contributions are payable only on basic wages dearness allowances, retaining allowance. But under the ESI Act 1948, the term wages is very wide and all-embracing.
There is a need to move from complexity to simplicity and from multiple labour laws to single labour code. For instance Trade Union Act 1926, Industrial Employment Standing Orders Act 1946, Industrial Disputes 1947 Act could be combined into a single act under the title ‘Industrial Relations Act’. Similarly there can be single act combining Payment of Wages Act, Minimum Wages Act, Payment of Bonus Act and Equal Renumeration(ER) Act.
According to the paper, a comprehensive social security cover could make a single contribution and a single return possible instead of separate contributions and returns under ESI Act 1948, EPF & Miscellaneous Provision Act 1952. The judiciary also faces a difficulty while defining the term or components of ‘Basic Wages’. Different courts have different rulings on PF and ESIC applicability. This has resulted in the filing of various writ petitions across the country by the aggrieved and leads to tremendous amount to confusion, it added.
