After Sweeping Agriculture Reforms, MP CM Shivraj Chauhan Announces Radical Recasting Of Labour Laws To Lure Investment

Following up on his sweeping reforms in agriculture sector that he unveiled to end the monopoly of APMC’s and permits farmers to directly connect to markets, Madhya Pradesh Chief Minister Shivraj Singh Chauhan announced a slew of reforms in labour laws that will effectively end ‘ inspector raj’ for new factories in the state

The series of labour law reforms announced today will provide significant relaxations for industries from departmental inspections, exempt them from maintaining registers and allow them to schedule shifts to ensure maximum productivity.

The various concessions provided to industries in the next 1,000 days is seen as concerted effort by CM Shivraj Singh Chouhan to woo industries to set up factories in the state.

The state has proposed major amendments to the various provisions of Factories Act, Madhya Pradesh Industrial Relations Act and Industrial Disputes Act. The new establishments will get exemption from provisions of the labour law in the next 1,000 days

“After the amendment in the Industrial Disputes Act 1947, new establishments will get exemption from many provisions in the Industrial Disputes Act for 1,000 days. Establishments will be able to keep the labourers in service as per their convenience. The intervention of the department of labour and the labour court in action taken by the industries will be stopped,”, official press released by the state government added.

The proposed amendment to Madhya Pradesh Industrial Employment (Permanent Order) Act, 1961, will exempt factories employing up to 100 workers from the provisions of the Act and “will make workers faithfully cooperate with production’’.

The new factories will also be exempted from contributing (Rs.80 per worker per annum) towards the Madhya Pradesh Labour Welfare Board fund, set up in 1982, for over two years.

“Along with this, they will also get an exemption from [filing] the annual return,” the government said.

The newly established factories will be exempted from various provisions of the Factories Act.

“Under the Factories Act 1948, new industries will be exempted from all sections except Sections 6,7,8, Section 21 to 41 (H), 59,67,68,79,88 and Section 112 of the Factories Act, 1958. This will now exempt industries from departmental inspections. Industries will be able to conduct third-party inspections at will,” the press statement said.

Under the proposed amendments, establishments employing less than 50 workers will be inspected only with permission of the labour commissioner and factories will have to file one return instead of two. Change in the definition of factory, which corresponds with the number of workers, has also been proposed.

Madhya Pradesh also issued a notification on Tuesday (May 5) to amend the Public Services Guarantee Act. The time given to certain services related to the labour department has been reduced from 30 days to one day.

These services include online registration under the Factories Act, Shops and Establishment Act, Contract Labours Act and Interstate Migrant Workers Act, Motor Transport Workers Act, MP Building and other Construction Workers Act and Beedi and Cigar Workers (Conditions of Employment Act).

Given the labour laws are concurrent subject , the ordinance to amend Factories Act and Industrial Disputes Act will come in to effect only after the permission of the union government comes through.