Pitching for a comprehensive national employment mission, India Inc on Sunday called for an inter-ministerial and all-State National Employment Board for driving job creation, while also recommending an “immediate action” plan, including labour law reforms.
“Employment generation extends to multiple dimensions and a national mission is required to address all aspects holistically. The Government National Employment Mission should include flexibility in hiring, tax incentives, education and skill development, and promotion of labour-intensive sectors,” Chandrajit Banerjee, Director-General, Confederation of Indian Industry (CII), said. The industry body said the government should set up the Employment Board with representation from all stakeholders including key ministries, State governments, industry experts and trade unions. The Board, it suggested, should look into employment creation hurdles and address them on real-time basis.
Additionally, the CII recommended a five-point agenda for the Budget to give a boost to employment and sought introduction of fixed term employment and labour law reforms. “While the industry is not asking for a hire-and-fire policy, a more flexible labour regime would enable India to align with multiple global trade challenges at a time when other nations are attracting new investments,” it said.
Minimum wage
The CII said States should have the power to determine the minimum wage based on geographic location, skill and occupation. However, it cannot be lower than the minimum wage fixed by the Centre. “The concept of a national minimum wage will affect job creation, so it is necessary to give States power to fix their own minimum wages,” it said, adding that the government should fix the minimum wage of unskilled workers. However, wages of skilled and semi-skilled labour force should be determined by market forces.
Under the Prime Minister’s Rozgar Protsahan Yojana, the wage threshold should be increased to ₹25,000 from ₹15,000, it said. The scheme provides for government contribution to EPF and EPS for new employees earning less than ₹15,000 for three years.
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Further, it recommended that benefits under Section 80JJAA of the Income Tax Act should be extended to all workers earning up to ₹50,000 in any sector. “The number of days of employment has been reduced to 150 for workers in the textiles, garments, footwear and leather sectors and this can be also extended to all manufacturing sectors.”
The CII also asked the government to consider corporate income tax rebates for enterprises employing over a certain number of formal workers. This will incentivise hiring while adding to investible resources, the industry body said. Lastly, it proposed that skill vouchers and skill wallets be provided for boosting skilling. “This is in accordance with the Skill India Mission of incentive-based support rather than subsidy-based support. Skilling should be demand driven and focused on identified 24 high-growth sectors for higher impact,” it said.
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