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Set up an inter-ministerial and all-state national employment board for driving job creation: CII
Jun 22, 2019

Confederation of Indian Industry (CII) today called for a comprehensive National Employment Mission and setting up of an inter-ministerial and all-state National Employment Board for driving job creation in the country.

“Employment generation extends to multiple dimensions and a national mission is required to address all aspects holistically. The Government National Employment Mission should include flexibility in hiring, tax incentives, education and skill development, and promotion of labour-intensive sectors,” suggested Mr Chandrajit Banerjee, Director General, CII.

Recommending immediate action, CII outlined a five-point agenda for the upcoming Budget.

One, states that introduce Fixed Term Employment and other labour law reforms should receive priority in new Central Government infrastructure project funding. Transport and power projects along with industrial parks can be fast-tracked for these states to enable them to leverage such employment policies.

Two, benefits under Section 80JJAA of the Income Tax Act should be extended for all workers earning upto Rs 50,000 in any sector. The number of days of employment has been reduced to 150 for workers in the textiles, garments, footwear and leather sectors and this can be also extended to all manufacturing sectors.

Three, under Prime Minister’s Rozgar Protsahan Yojana, the wage threshold should be increased to Rs 25,000 from the current Rs 15,000. PMRPY provides for Government contribution to EPF and EPS for new employees for three years, applicable to workers earning less than Rs 15,000. With wages increasing, the threshold for applicability should also be raised, said CII.

Four, corporate income tax rebates should be considered for enterprises employing over a certain number of formal workers. While incentivising hiring, this will also add to investible resources.

Five, skill vouchers and skill wallets may be provided for boosting skilling. This is in accordance with the SkillIndia Mission of incentive-based support rather than subsidy-based support. Skilling should be demand driven and focussed on identified 24 high-growth sectors for higher impact.

CII suggested that the Government should set up a National Employment Board that would include representatives of key ministries, state governments, industry experts, and trade unions and other stakeholders that would look into employment creation hurdles and address them on a real-time basis.

Commenting on the suggested national minimum wage, CII said that states should have the power to determine minimum wages based on three criteria - geographic location, skill and occupation. However, it cannot be lower than the minimum wage fixed by the Centre. The concept of a national minimum wage will affect job creation, so it is necessary to give States power to fix their own minimum wages.

Government should fix minimum wages of unskilled workers. However, wages of skilled and semi-skilled labour force should be determined by market forces, according to CII.

To encourage more women to participate in the workforce, CII recommended providing Child Care & Maternity Benefit subsidies under the Maternity Benefit Amendment Act.

While industry is not asking for a hire-and-fire policy, a more flexible labour regime would enable India to align with multiple global trade challenges at a time when other nations are attracting new investments, said CII.

New Delhi

22 June 2019

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