Companies see Haryana local hiring bill hurting state, industry growth

Topics Haryana | Hiring | Auto sector

The state governor has to give assent to the bill before it becomes law. Representational image shows an auto worker assembling a car
With the Haryana Assembly passing a bill to give 75 per cent reservation in the private sector to job seekers from the state, companies across sectors see the move detrimental to the growth of the state and industries therein.

If the bill becomes law, it is likely to have a major impact on the automobile industry, which is planning to move the state government through industry bodies like CII.

The state governor has to give assent to the bill before it becomes law.

"There is always a benefit to hire locally. But companies have to hire from outside as availability of certain skillsets are very crucial to such (auto industry) jobs. We will have to wait and watch to see how this is implemented," R C Bhargava, chairman at Maruti Suzuki said.

Maruti Suzuki, one of the largest employers in the Manesar auto belt had opposed the bill when it was in draft stage.

Vinnie Mehta, director-general of Automotive Component Manufacturers Association of India (ACMA), which is the lobby group of auto component manufacturers said that the law, in its current form will diminish Haryana's attraction as an investment destination.

"Automobile as an industry has to focus on skills of the candidate because most of them are high precision job. We will definitely communicate to the government on the difficulty to implement such a law," Mehta said.

Meanwhile, CII which works closely with the Government of Haryana and supports the state on various issues also expressed strong views on bill passage.

“The move to reserve employment for locals in Haryana will impact existing businesses, state’s industry friendly image, slow down new investments and further deteriorate Ease of Doing Business Ranking,” Sunjay Kapur, chairman at  CII Haryana state said via email response.

 “We request the state government to reconsider this decision and work towards enhancing the employability of the Haryanvi Youths by considering opening up 1 world class ITI (Industrial Training Institute) in every district of the state. Many such industry-linked institutes could be opened and Haryanvi Youth will eventually become employable not only for jobs within Haryana but anywhere in the country / world,” Kapur added.

Alongside, company executives of the FMCG sector admit that 50-75 per cent local hiring is not practical to implement.

“Locals are normally hired on the factory floor and not in other job functions. This trend will continue,” said an industry official.

“Also, locals are not ready to work at lower pay, are difficult to train and do not want to do manual work. These are some of the practical difficulties, which prevents companies from implementing these measures,” he added.

Meanwhile, Delhi-based Jindal Stainless (Hisar) Limited which has a 0.8 million tonne stainless steel plant in Haryana currently employs only locals at the facility.

“We have no migrant workers at the plant but as part of good corporate governance (once the law is in place), company will abide by all norms stipulated by the government,” S.K. Jain, chief human resources officer at Jindal Stainless (Hisar) told Business Standard via email response.

The company has two subsidiaries –JSL Lifestyle Limited and Jindal Stainless Steelway Limited.

At Ratan Jindal-led Jindal Stainless (Hisar), most people below the specified ceiling of Rs 50,000 per month are hired locally from ITIs and Polytechnic colleges. They are either from Hisar or from nearby areas.

“Our organisation has been serving the local communities at large through multiple platforms. We have adopted local ITIs and tied up with various educational institutions to provide training and on-the-job learning. The company plays a significant role in up-skilling of local youth and provides employment opportunities through regular employment and CSR initiatives,” Jain added.

The Haryana State Employment of Local Candidates Bill, 2020 provides the quota for local people in private sector jobs that offer a salary of less than Rs 50,000 a month.

(Aditi Divekar/Arindam Majumder/Viveat Susan Pinto/Arnab Dutta have contributed to the copy)

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel