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Labour Ministry to draft a single law for MSME to increase formalisation

New Delhi, Sept 12  Government is revising the legislation so as to encourage MSME participation for quality apprenticeship, said Minister of Labour and Employment, Narendra Singh Tomar adding that the ministry is in process of drafting a single law for MSME to increase formalisation.

“From the supply side, creation of local jobs and development of SMEs have been identified as the doorways to reduce structural unemployment,” he said while addressing the Labour Ministers’ Conference of G-20 Nations in Australia yesterday.

The conference was held on September 10-11 at Melbourne Australia where Labour Ministers of the major 20 economies in the world discussed global issues relating to labour.

Tomar added, “One of the key requirements to boost labour market participation rate is to minimize the skill mismatch in job market by enhancing the skill base of the workforce in emerging economies like India. Structural unemployment and underemployment are the biggest challenges on account of the mismatch between demand and supply factors of employment and rigidities in the labour market.”

He elaborated that Government of India is adopting multipronged strategies to address it from both demand and supply side.

From the supply side, creation of local jobs and development of SMEs have been identified as the doorways to reduce structural unemployment.  Further, the Labour Ministry has started a scheme on “Demand Responsive Vocational Training”.

Under this scheme, any industry can sign an MOU with Government to conduct training programme to meet specific skill requirement of the company which would ensure minimum 80 per cent employment in any local industry.

From the demand side, emphasis is given to creation of appropriate skill sets among the rural migrant and urban poor.

“We are in favour of labour mobility, skill portability and harmonization of skills qualification framework for a paradigm shift of labourers from low skill based work to high productivity jobs,” Tomar said.

Skill Development Initiative Scheme, based on Modular Employable Skill (MES) framework has been in operation to provide vocational training to early school leavers and existing workers, especially in unorganized sector, he added.

Speaking in a session on “Creating better jobs”, Tomar admitted that employment generation is India’s biggest challenge today.

“Every year almost 10 million people enter the labour force in India. A large informal sector, lower participation of women in labour force, increasing the productivity of labour and providing social protection to the vulnerable sections are our the main challenges,” he said.

The government is encouraging flexi-MoUs with Industries to promote employability, he added. 

MSMEs are not only important for job creation, promoting entrepreneurship but are also important for providing on the job training to youth. “We are providing for financial assistance to promote apprenticeship in MSME. We are also suitably revising our legislation so as to encourage industry participation for quality apprenticeship,” he elaborated. 

“We are amending our labour laws in order to encourage investment, ease of doing business and entrepreneurship.  We are also working on Minimum age of employment, and to provide a mandatory national floor level of minimum wages. We are also in process to draft a single law for MSME to increase formalisation,” Tomar said.

“We have developed a unified web portal for online compliance of labour laws thereby promoting ease of compliance. Employers henceforth will be able to file a single, simplified, annual online return instead of filing separate returns under multiple laws. Labour Inspection Scheme is also being revamped to make it completely objective, transparent and accountable,” he added.

Source : http://www.knnindia.co.in