The Prime Minister of India Mr. Narendra Modi, on 16 October 2014, announced various labour reforms and schemes to ease the rules for establishments doing business in India and to provide several benefits to the employees. The said reforms and schemes aim to create a favorable environment for industrial development by ensuring transparency in the labour sector. A brief synopsis of the proposed reforms/schemes has been provided below.

  • Shram Suvidha Portal, which would allot unique Labour Identification Number (LIN) to nearly six lakhs units and allow them to file a single online consolidated return for 16 (out of the total 44) labour laws. Multiplicity of labour laws and the difficulty in their compliance has always been cited as an impediment to the industrial development in India. This portal should bring in the necessary ease in compliance of provisions related to labour and act as a step forward in promoting the ease of doing business in India.
  • Random Inspection Scheme, which envisages utilizing technology to eliminate human discretion in selection of units for inspection and mandatory uploading of inspection reports within 72 hours of inspection by the labour inspectors. To bring in transparency in labour inspection, a labour inspection scheme is being developed with the following main features: (i) coverage of serious matters under the mandatory inspection list; (ii) random generation of a computerized list of inspections based on pre-determined objective criteria; (iii) complaints based inspections will also be determined centrally after examination based on data and evidence; and (iv) provision of emergency list for inspection of serious cases in specific circumstances.
  • Universal Account Number Scheme, which would enable employees to have their Provident Fund account portable and universally accessible. This will provide portability of the social security benefits to the labour of organized sector across the jobs and geographic areas and enable provident fund account holders to have direct access to their provident fund accounts and consolidate all their previous accounts.
  • Apprentice Protsahan Yojana, which aims to support the manufacturing units and other establishments by reimbursing fifty percent (50%) of the stipend paid to apprentices during the first two years of their training.
  • Revamped Rashtriya Swasthya Bima Yojana, which proposes to introduce a smart card for the workers in the unorganized sector seeded with details of two more social security schemes.

With the Ministry of Labour and Employment introducing the above schemes, they shall, at the outset, be implemented with respect to the employees and workers under central agencies and autonomous bodies. Labour, being a concurrent subject under the Constitution of India (i.e. the subject matter over which both Central and State Government can legislate), the above schemes will apply in the States only after they make similar changes to their respective labour rules and laws.