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Anjali Assignment 1

Differences in state labor laws in India can negatively impact outcomes. States have varying minimum wages, with some like Bihar being significantly lower than others like Delhi, forcing workers to migrate. Holiday schedules also differ by state, which can disadvantage inter-state employees. During COVID lockdowns, some states relaxed labor laws more than others to boost economies. Haryana's new job quota reserving 75% of private sector jobs for locals under 50,000 rupees monthly may discourage businesses and disadvantage non-local job seekers. The lack of uniformity in labor laws across India's diverse states can undermine economic development and worker welfare.

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47 views

Anjali Assignment 1

Differences in state labor laws in India can negatively impact outcomes. States have varying minimum wages, with some like Bihar being significantly lower than others like Delhi, forcing workers to migrate. Holiday schedules also differ by state, which can disadvantage inter-state employees. During COVID lockdowns, some states relaxed labor laws more than others to boost economies. Haryana's new job quota reserving 75% of private sector jobs for locals under 50,000 rupees monthly may discourage businesses and disadvantage non-local job seekers. The lack of uniformity in labor laws across India's diverse states can undermine economic development and worker welfare.

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ASSIGNMENT 1

How do tough economic conditions affect employee relations?


We are aware of the fact that Employee- employer relations have never been constantly
satisfactory, there are disagreements carries out in form of strikes, lockout and
terminations. Labour productivity is reduced as a result of industrial conflicts. Work quantity
and quality suffers, while costs soars.
According to a survey performed by the Society for Human Resource Management, over half
of HR professionals rated staff retention/turnover as a top problem. Retaining workforce is
more complicated for many businesses than hiring them.
There are several factors that affect this relationship one of them being Tough Economic
conditions like recession. As the Indian economy begins to damage businesses, CEOs will
continue to focus on minimising operating expenses, such as decreasing expenditures by
ways for reducing salary and wages, laying off employees, deferring salaries, for projects
that affect employee engagement, in order to protect their bottom lines.
As a result of the Economic slowdown, many businesses, frequently have resorted to wage
reduction, salary delay, and the reduction or elimination of variable components, perks, and
perquisites that form the employee's cost to the firm. However, in times when inflation hits,
employee might not feel jolly with firm’s cost cutting strategy and often not agree to work
in reduced salary and thus employee- employer relation may hit the bottom line.
Paying a few months' wage has been a hardship for several businesses during this volatile
period, since many are dealing with limited cash flows and thus, they often opt for
retrenchment policy to reduce the cost.
In wake of pandemic-19, organizations opted for Work from home policy, which emerged as
challenge for both employees and employers. Because there is no codified rule governing
working from home, it has been difficult for businesses to develop methods for
implementing a successful work from home culture. Employees may also feel lonely and
yearn for tangible human interactions.
Another difficulty has been provided by the COVID-19 epidemic which was increase in
employee working hours. It is an action that shifts the burden disproportionately onto
employees. Over burdened employees are prone to stress and might feel detached from
organization.
All options exercised by employers, while unavoidable, can have a significant negative
influence on employee relations if not managed appropriately by the administration.
As a result, during a turbulent moment or economic disruption, businesses and employees
must execute a balancing act.

Employee relations that are strong may also help to prevent workplace concerns such as
bullying and disagreements. Furthermore, your staff will feel respected and empowered to
do their best job. Companies that focus employee interactions frequently claim improved
performance and lower absenteeism.
How are individual workers’ rights currently being challenged in India?

Worker rights are a hotly debated subject among intellectuals, and they also play a
significant role in the country's politics. Whilst Indian businesses have made great strides in
acknowledging and committing to improving worker rights, welfare, and well-being over the
years, most corporations are still underperformers when it comes to turning ambition into
practice.
The third edition of the India Responsible Business Index (IRBI) 2017 highlights that, despite
incorporating progressive policies for worker welfare, safety, and rights, there is no
discernible improvement in the way companies treat their employees, and draws attention
to the fact that much work remains to be done when it comes to actual policy
implementation.

Some state administrations, such as Uttar Pradesh (U.P.) and Madhya Pradesh (M.P.), have
proposed ordinances that would exclude industrial enterprises from most labour regulations
on pretext for attracting investments and job creation. Some of the laws that would no
longer apply include the Minimum Wages Act, Trade Unions Act, Industrial Disputes Act,
Factories Act, Contract Labour Act, Payment of Bonus Act, Inter-State Migrant Workmen
Act, Working Journalists Act, Employees’ Provident Funds and Miscellaneous Provisions Act.

In all of this, it is important to remember that India is still a labour-surplus nation, as


economists refer to it. There is frequently an excess supply of labour, especially at the lower
ends of the labour market where less education is necessary, which offers employers more
negotiating leverage. As a result, the state's obligation in such a situation is to defend the
interests of labour through law because the market does not provide them with the
required protection.
Some ordinances have frozen working conditions such as lighting, temperature, dust and
fumes, and brightness and the employer have every reason to ignore these circumstances
given the labour market's opportunistic behaviour and this can lead to hazardous working
conditions. Second, working hours are being extended. Long hours of labour, repetitive
tasks, and poor working conditions are widely documented to represent a significant hazard
to occupational safety and health.

So, the most serious implication of these labour laws changes is that they will cause
industrial dissatisfaction, even labour unrest, stifling any possibility of attaining economic
advancement. Furthermore, businesses will not gain because these measures will harm
labour welfare and, as a result, labour efficiency.
How differences in state affect outcome?
India has a mix of federal and unitary government, with a central government in charge that
is responsible for defence, commerce, and foreign affairs, and 28 states in the country, each
with their own administration and list of responsibilities ranging from agriculture to
education, giving them a lot of responsibility as well.

Even though, we find pride in embracing our concept of “unity in diversity”. The truth is
diversity and no uniformity in labour laws are putting outcome in the bottom line.

All states have different minimum wages, and in some states wage gap is so huge that it
leaves no choice for local of that state, but to migrate to other parts on India in search for
more income to earn bread for their families. Let’s take a simple example of Bihar, one of
the most underpaid jobs can we found in this state. Skilled labour in Bihar is paid
somewhere around Rs 300 to 400, whereas for same job in Delhi you get paid Rs 750.
Same goes for other states like Rajasthan, Jharkhand where labours are paid less. This forces
them to shift to other states, creating a labour hub like in state of Maharashtra or Delhi
NCR, now it is very obvious that Capitalists would set up factories with strong labour supply
and in all this chaos, states like Bihar get very less industries, making them underdeveloped.

Again, with India diverse ethnicity comes multiple religions and festivals, Every State has list
of their own holidays but this is problematic too. To state an example, In Bihar Chatth pooja
being a “Mahaparv” is closed holiday, so is Ganesh Pooja in Maharashtra, however for a
employee working in Mumbai but belonging from Patna, Holiday on Ganesh Pooja might be
of no use.

One of the most visible examples of differences in labour laws between states occurred near
the end of the country's covid 19 lockdowns, when states such as Bihar, Uttar Pradesh,
Madhya Pradesh, Rajasthan, and Gujarat relaxed many labour laws in order to boost
economic activity, while the rest of the country did not.

And finally, there is example of Haryana Government’s decision. The Haryana government
has promised a 75 percent quota for locals in private jobs with a monthly wage cap of Rs
50,000. Job reservation will also have a detrimental influence on the state's rapidly rising
digital entrepreneurship. It has been suggested that job seekers from other states agree to
work for low salaries, putting locals at a disadvantage, and that this adds to further issues,
such as the expansion of slums and the consequent community health concerns. Because of
its multiple stipulations, this will provide its own set of obstacles, one of which is that
enterprises cannot employ more than 10% of their workers from a single area of the state.
According to NASSCOM and recruiting services such as Quess and Xpheno, many new age
enterprises, especially start-ups, may have to consider shifting operations.

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