Conducive Labour Policies can help Gujarat achieve its goal of doubling jobs by 2023: The Esya Center




Agile and progressive Labour Codes are the need of the hour to meet evolving paradigms of a diverse workforce in a digital world




Gujarat, 27 October, 2021: Digital technologies have fundamentally transformed the way we work. They have removed traditional barriers to work, giving rise to new opportunities of employment such as work from home, part time employment, contract workers, and gig workers. Gujarat is home to over 345,000 MSMEs that play a vital role in the economic and social development of the state. E-commerce can help these MSMEs grow and provide new job categories as traditional avenues have been severely affected by the pandemic. Recently, Narayan Rane, the MSME Minister declared that they will be looking to double jobs in Gujarat’s MSME sector from 58 Lakh to 1.2 crores in the next 2 years.




Keeping this in mind, it becomes critical to have coherent and well-thought Labour Codes that will offer a unique opportunity to foster recovery in one of India’s most industrialized states. The need of the hour is to create policies which provide firms with flexibility to adjust their workforces in terms of time and location while giving them adequate protection. It is imperative to find balance and provide accommodative support to the new forms of employment, recognizing small contract laborers and businesses and making provisions for them.




The lack of a proper legal framework catering to non-traditional employees can lead to significant challenges for the upliftment of small business owners and enterprises. Additionally, the codes neither sufficiently clarify the definition of core work nor include e-commerce organizations as part of the umbrella sectors involved in the supposed core work. This leaves scope for misinterpretation and creates a situation that will hamper the employability of contract workers. There is also a need to ensure vulnerable migrant workers are protected from being stranded without basic amenities. The new codes should be targeted towards them and hence, socio-economic classification must be taken into account. Speaking at a briefing session organized by The Esya Center, a leading policy think tank, Mr. Vivan Sharan, Secretary, Esya Centre, said, “The existing codes can be characterized as taking two steps forward and a step backwards with respect to tech-based companies. Despite positive elements, such as social security for gig workers, the Codes limit the freedom given to employers and employees to determine the contours of their relation. This is particularly visible in the form of restrictions on working hours, cumbersome registration requirements and prescriptive standards related to working conditions. There is a need to rationalize these restrictions and offer more flexibility while also safeguarding the rights of the workforce.”




Sharing his legal expertise on the matter, Mohit Chawdhry, Junior Fellow, Esya Centre, highlighted that, “The new Labour Codes must work towards enabling flexible work weeks to benefit both workers and employers. The government should rationalize checks on working hours while simultaneously developing systems to prevent worker exploitation”. He further added, “Part time work is important for India from a development perspective as developed countries often edge towards having a higher proportion of employees who work part time hours. There is a need for the codes to recognise and define part time work and enable participation by a larger and more diverse group in India’s labour force.”




There is a huge potential for improvement in the new legislation. Any hope for tangible growth and improvement in the labour regime will be undermined if some issues aren’t rectified. There is a need for the government to invite and acknowledge the suggestions by stakeholders and take into account the rising employment potential of digital sectors such as e-commerce. Hence, the codes should address ways to significantly reduce compliance burden, improve the ease of doing business, and provide enhanced flexibility to employers in terms of work hours. Provisions should also allow full time employees to be able to choose their working hours each day without crossing the weekly limit.