The Central government has exempted 63 godowns, depots and railheads of the Food Corporation of India(“FCI”) across the country from the provisions of Contract Labour (Regulation and Abolition) Central Rules, 1971, for a period of two years starting from July 6, 2020 . In exercise of the powers conferred by Section 31 of the Contract Labour (Regulation and Abolition) Act, 1970, the godowns, depots and railheads of Food Corporation India will be exempted from the applicability of notifications of the government of India in the Ministry of Labour and Employment in respect of employment of labour in different jobs further for a period of two years. This step will facilitate a way for easier employment and regulation of workers in FCI.
A majority of FCI’s godowns, 226 depots and railheads, were prohibited from hiring contract labour till recently, due to various prohibition notifications issued by the government since 1985. FCI had moved an application in 2014 asking the Labour Ministry to de-notify the prohibition order, and allow it to hire contract workers in all its establishments without conditions and for an indefinite period.
Before granting an exemption, the Labour Ministry had referred the matter to the Central Advisory Contract Labour Board (CACLB), constituted under the Contract Labour (Rehabilitation and Abolition) Act of 1970. The CACLB, in its meeting held on March 30-31 and May 4, rejected the FCI’s application. It also stated that as per the law, the government can grant an exemption from the Contract Labour Act of 1970 to an establishment only in case of an emergency and only for a fixed period of time. The Labour Ministry had overruled its expert panel’s advice and decided to allow FCI to hire contract workers at all its units for an indefinite period, said a senior government official. However, the Law Ministry objected to the ‘indefinite’ applicability of such an exception, so the labour ministry restricted the freedom to two years.
The All India Trade Union Congress and FCI Handling Workers’ Union are also planning to file petitions in the Delhi High Court challenging the Labour Ministry notification in the coming days.
As per the plan, FCI wants to engage only contract labour in place of a four-tier system: regular employees, direct pay system (those getting minimum wage), no work no pay (those who get paid only when there is work) and contract labour system in a bid to save about Rs.2,000 crores a year. The Labour Ministry notification will help FCI in pulling the labour quickly. It will also help us in reducing the incentives thereby reducing costs, said FCI Chairman and Managing Director Yogendra Tripathi. The move would benefit food storage depots of FCI across Uttar Pradesh, Madhya Pradesh, Delhi, Jharkhand, West Bengal, Kerala, Punjab, Tamil Nadu, Assam, Bihar, Haryana and Himachal Pradesh.
Vide a press release, the Reserve Bank of India (“RBI”), on April 18, 2019 released the draft of Enabling Framework for Regulatory Sandbox Principles and