The Union Cabinet on Wednesday introduced labour law changes while approving a Rs 6,000-crore package for the textile and apparel sectors.A key element is an increase in overtime for workers wh ich should not exceed 8 hours per week, translating into nearly 90 hours over three months. The current norm allows 50 hours of overtime in three months. “It'll be advantageous for the industry as well as labour,“ said A Sakthivel, who represents industry lobby groups. The new cap on overtime, which meets ILO norms, wo uld help increase earnings of workers, the Centre said. The new cap on overtime meets International Labour Organisation norms, and the government dubbed it as a move that would help raise earnings of workers.
The cabinet has approved the introduction of fixed-term employment, as sought by industry , to deal with the seasonal nature of demand. A fixedterm workman will be considered on a par with a permanent worker in terms of working hours, wages, allowances and other statutory dues. While the move is unlikely to result in higher burden on companies, it provides more flexibility in hiring to deal with seasonal rush, especially for exporters. The government also announced a change in income tax laws to allow for deduction in case more permanent workers are hired by textile and garment units.Instead of the current provision of the benefit accruing if workers are hired for 240 days, the government has now lowered the floor to 150 days. Industry players said this would provide greater flexibility.
In what could become the template for other industries, the government has made it optional for textile industry workers earning less than Rs 15,000 a month to contribute to the Employees' Provident Fund.“The announcement will bring relief for the garment sector where a large number of employees work short-term and prefer to take full wages without deduction,“ M Senthil Kumar, chairman of the South India Mills Association, said. The move is also significant as the finance ministry has been trying to wean away employees from EPF to the National Pension Scheme.
The cabinet has approved the introduction of fixed-term employment, as sought by industry , to deal with the seasonal nature of demand. A fixedterm workman will be considered on a par with a permanent worker in terms of working hours, wages, allowances and other statutory dues. While the move is unlikely to result in higher burden on companies, it provides more flexibility in hiring to deal with seasonal rush, especially for exporters. The government also announced a change in income tax laws to allow for deduction in case more permanent workers are hired by textile and garment units.Instead of the current provision of the benefit accruing if workers are hired for 240 days, the government has now lowered the floor to 150 days. Industry players said this would provide greater flexibility.
In what could become the template for other industries, the government has made it optional for textile industry workers earning less than Rs 15,000 a month to contribute to the Employees' Provident Fund.“The announcement will bring relief for the garment sector where a large number of employees work short-term and prefer to take full wages without deduction,“ M Senthil Kumar, chairman of the South India Mills Association, said. The move is also significant as the finance ministry has been trying to wean away employees from EPF to the National Pension Scheme.
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