New Delhi: The Union cabinet on Wednesday approved proposals to amend three key labour laws, including the Factories Act 1948, pushing ahead with reforms to archaic legislation considered an impediment to output growth and employment creation in the labour-intensive manufacturing sector.

The other two proposals relate to the amendment of the Apprentices Act 1961 and the Labour Laws (exemption from furnishing returns and maintaining registers by certain establishments) Act, 1988, labour ministry officials said on condition of anonymity. No official announcement of cabinet approval had been made as of press time on Wednesday.

“While we have tried to ease the process of doing business with industries, the amendments have kept in mind the safety and welfare of employees," said one labour ministry official.

The proposed changes to the Factories Act centre on five points—improved safety of workers; doubling the provision of overtime from 50 hours a quarter to 100 hours in some cases and from 75 hours to 125 hours in other work of public interest; increasing the penalty for violation of the Act; relaxing the norms for women to work in some industry segments at night; and reducing to 90 from 240 the number of days an employee needs to work before becoming eligible for benefits like leave with pay.

In a written reply to the Rajya Sabha on Wednesday, minister of state for labour Vishnu Deo Sai had said the government was considering changes to the 66-year-old Factories Act to make it “more compatible with the requirement of the present scenario in the industrial sector".

The official said the proposed amendment would do away with a provision for prosecution of factory owners for petty offences like not maintaining a clean toilet, for instance. The amendment proposes to reduce punishments prescribed under such heads to remove the fear of persecution among factory owners.

Sai also said in the Rajya Sabha that the government was making provisions for enhancing the safety of workers and for better amenities on factory premises. In the Apprentices Act, the government is seeking to expand the scope of employment as apprentices on the shop floor. Until now, most apprentices have been from engineering backgrounds; the government is seeking to push for the induction of non-engineers as apprentices. It is aimed at allowing young job seekers and students to gain industry-relevant skills on the shop floor. “The salary segment too has been liberalized," the labour ministry official said. In the first year, an apprentice will get 70% of what a semi-skilled worker gets, in the second year 80% and in the third year 90%.

For those employed in small-scale industries, the government will pay 50% of their salary and the factory management the remainder.

“This will increase the...skilled manpower in the country and help industries get job-ready employees," the official said.

India has 300,000 apprentices; Germany has more than 3 million. Amending the Act would open the doors to employment as apprentices for millions more.

The proposal to amend Labour Laws (exemption from furnishing returns and maintaining registers by certain establishments) Act, 1988, will allow thousands of small industries to file just one return for compliance with a dozen or more labour laws.

Once the amendment is passed, it will exempt small industries with less than 40 workers from the need to comply separately with each of the laws. A single-page return on compliance will do.

“The initiative is a fine balance between labour welfare and industry-friendly and job-oriented reform," said a second labour ministry official, who also declined to be named.

Trade unions are opposed to some of the industry-friendly changes the government is bringing about and will meet in the first week of August to discuss the proposals, said D.L. Sachdeva, national secretary of the All India Trade Union Congress. “We are opposed to the proposal to put women in the night shift. We are also opposed to increasing the overtime limit to 100 hours from 50 hours per quarter," he said.

The cabinet also decided to place in Parliament “action taken" reports on the findings by a commission that studied illegal mining in Jharkhand, Odisha and Goa.

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