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Govt to amend Apprenticeship Act in monsoon session to boost hiring

In the new bill, the government is likely to allow Indian firms to deploy apprentices in their operations abroad if they so wish and use third-party aggregators such as staffing firms to help scale up apprenticeship training and hiring. (MINT)Premium
In the new bill, the government is likely to allow Indian firms to deploy apprentices in their operations abroad if they so wish and use third-party aggregators such as staffing firms to help scale up apprenticeship training and hiring. (MINT)

The Act will allow small and micro companies operating in a cluster to hire jointly and deploy apprentices on a sharing basis

The Union government is ready to amend the Apprenticeship Act in the upcoming monsoon session of Parliament to expand its scope, provide inbuilt flexibility, and allow companies to hire more apprentices.

The ministry of skill development and entrepreneurship has started inter-ministerial consultation on the proposed changes, following which it will go to the cabinet for approval, two government officials said requesting anonymity.

The Act will allow small and micro companies operating in a cluster to hire jointly and deploy apprentices on a sharing basis. It means a group of homogenous small firms may hire a batch of apprentices, share stipend and deploy them based on individual requirements within the contract period, said one of the two officials mentioned above.

It may formally allow employers to take up to 15% staff strength as apprentices compared to the current threshold of less than 10% and allow a company to deploy apprentices at multiple locations, such as the manufacturing unit, shop floor, and at vendors’ site, the second official said.

Apprentice training is considered the best form of shop floor training and increases employees productivity. It also helps employers lower employee acquisition cost.

“The Union budget had announced that we shall embark on reforming the Apprenticeship Act and in less than six months we are almost ready," the second official said.

“In 2016, we had launched the National Apprenticeship Promotion Scheme. The government proposes to amend the Apprenticeship Act with a view to further enhancing apprenticeship opportunities for our youth," Union finance minister Nirmala Sitharaman had said while presenting the 2021-22 Union budget. The budget has allocated 3,000 crore for promoting apprenticeship.

In the new bill, the government is likely to allow Indian firms to deploy apprentices in their operations abroad if they so wish and use third-party aggregators such as staffing firms to help scale up apprenticeship training and hiring. It will also reduce regulations and penalty clauses if some firms fail to hire despite promising to do so and shall allow them options to correct any past promises. This means that the amendment will effectively promote self-governance.

Staffing firm TeamLease Services said it has witnessed a surge in apprenticeship hiring and sectors such as healthcare, pharmaceuticals, IT-enabled services, banking and financial services, and e-commerce are lead recruiters in this space.

“The apprenticeship route has also enabled aspiring candidates to more easily join formal employment. Today 95% of the certified apprentices are in formal employment. Of these, 40% are being absorbed by the same employers where the candidates had done their apprenticeships. A majority of these apprentices are now earning an average 45% premium on their wages, as they have advanced their skill expertise through the apprenticeship route," said Sumit Kumar, vice president (national employability through apprenticeship programme) at TeamLease Skills University.

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