Budget 2024: Four key expectations for the HR sector. Know here

As we approach the Union Budget 2024, the HR sector in India harbours specific expectations, particularly regarding policy reforms that currently pose challenges. A primary area of focus is the streamlining of labour laws, which were characterised as cumbersome, rigid, and difficult to follow. Finance Minister Nirmala Sitharaman is set to present interim budget on 1 February 2024.

So let's look at some of the major expectations for Budget 2024 from various industry experts.

1)Labour laws

“The sector thus anticipates reforms that would simplify these laws, making them more adaptable to the modern workplace, especially in terms of flexible working arrangements and remote work policies,” said Dr. Ravinder Goyal, Co-Founder, Erekrut HR Automation Solutions Pvt Ltd.

2) PF, ESI schemes

The segment could also benefit from the refinement of the Provident Fund (PF) and Employee State Insurance (ESI) schemes. 

“The current structures of these schemes pose administrative challenges and often result in delayed contributions and settlements. An overhaul aimed at simplifying these processes could greatly enhance operational efficiency in HR management,” said Dr. Goyal.

3) Enhanced tax incentives

“The issue of limited skill development in medium-sized institutions needs to be addressed. Employees shall be encouraged to equip themselves with essential skills like AI and BI, there should be tax breaks for skill upgrading through NSDL-authorised vendors. This step not only supports individual professional growth but also contributes to a more skilled and competitive workforce,” said V C Karthic, Founder, Buzzworks Business Services

Moreover, the HR sector needs more supportive measures to nurture talent, specifically through enhanced tax incentives for employee training and development programs, added Dr. Ravinder Goyal.

This would encourage companies to invest more in upskilling their workforce, aligning with the evolving skill demands of the digital economy. Along with this, the expansion of tax benefits under schemes like Section 80-IAC, which currently has restrictive criteria, is desired to enhance accessibility to a broader range of startups, Dr Goyal further added.

4) Women's participation

It​ is also crucial to take proactive measures to encourage women to re-enter or remain in the workforce. According to V C Karthic, this will contribute to a more balanced and diverse professional landscape.

In essence, the HR sector's pre-budget expectations for 2024 revolve around policies that reduce compliance complexity, foster talent development, and support startups through more inclusive and flexible fiscal incentives. These changes are crucial for creating a more dynamic and responsive HR landscape in India's rapidly evolving economic environment.

Disclaimer: The views and recommendations made above are those of individual analysts, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.