Amid move to relook at labour shield for IT, Kharge says exemption to continue till 2029
The Karnataka labour department is seeking a serious "relook" at the exemption under the Karnataka (Standing Orders) Act of 1946 for IT, ITeS, BPOs and startups. In light of the TCS move, labour minister Santosh Lad said there is an urgent need to look at the exemption clause enjoyed by tech and tech-enabled companies.
However, IT&BT minister Priyank Kharge said the exemption clause has been in force from 2014 and will remain in effect till 2029.
"Nothing can be done for now," he added.
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Also, IT-BT department officials said withdrawing the exemption — a major incentive for the industry — may not be encouraging for Karnataka's economy especially when neighbouring states are trying to poach companies from Karnataka. "The exemption from labour laws is an attractive option for Karnataka to retain GCCs and IT services sector," said a senior department official.
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Minister Lad said the govt needs to take a hard look at the reasons behind the layoff move. "Whether the state labour department can interfere is what we need to look at because sunrise companies enjoy the exemption," he said, adding he would speak to the IT-BT minister and the industries minister.
Minister Kharge said the TCS development "is an internal matter" over which the govt does not have any control and that it does not reflect the condition in other IT and ITES companies.
On Sunday, Lad said his department is already talking to TCS and coordinating with other relevant departments.
There are four conditions laid down in the standing-order exemptions to IT/ITES/BPO and startups: Set up internal committee to prevent sexual harassment at workplace; form a grievance-redressal committee; inform the labour department on disciplinary actions against employees; ensure employee service conditions at workplace.
These exemptions were enforced in Karnataka for the IT/ITES sector in 2014 for a five-year period. Subsequently, it was extended twice for a five-period each.
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Industrial Employment (Standing Orders) Act 1946
The labour standing orders are applicable to any industry which has over 100 employees and are intended to maintain harmonious relationships between employers and employees, to regulate conditions of recruitment, discharge, disciplinary action, leave, holidays of the workers. The orders dictate classification of the workforce, work schedule, holidays, paydays, and wages. Notices must be issued before termination of employment, allow formation of labour unions and labour dept inspection.
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