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The Karnataka government is currently contemplating a significant alteration to its labor laws, specifically focusing on extending daily work hours. The proposal suggests increasing the standard workday from nine to ten hours, coupled with an allowance for increased overtime work. This initiative, however, has sparked considerable controversy, particularly drawing opposition from the Joint Committee of Trade Unions (JCTU), a collective representing eight trade unions across the state, and the Karnataka State IT/ITeS Employees Union. These unions express deep concerns about the potential ramifications of such a change on the workforce. The proposal is likely to be referred to the Cabinet before any final decision is made, highlighting the seriousness and potential impact of the matter. The move originates from a directive issued by the central government, which urged states to streamline and simplify the existing labor laws governing working hours. In response, the Karnataka Labour Department drafted a Bill to amend the Karnataka Shops and Establishments Act of 1961. This amendment aims to not only extend the daily working hours but also to raise the ceiling on permissible overtime work. The scope of this Act is broad, encompassing a wide range of commercial establishments, including IT and ITeS companies, offices, pubs, bars, restaurants, hotels, and malls, indicating that a substantial portion of the state's workforce could be affected. While Labour Secretary Rohini Sindhuri convened a meeting with stakeholders to gather opinions, both in favor of and against the proposed amendment, Labour Minister Santosh Lad emphasized that further consultation would be necessary before any concrete steps are taken. This suggests a cautious approach from the government, acknowledging the sensitivity of the issue and the need for comprehensive input from all relevant parties. Mr. Lad highlighted that the discussions were initiated following a presentation by Manoj Joshi, Secretary of the Union Department of Land Resources, who advocated for the increase in work hours and for measures to enhance the ease of doing business. The Minister indicated that the matter might ultimately be escalated to the Cabinet for deliberation and decision-making, underscoring the importance of achieving consensus among key government officials. He reassured that any decision made would prioritize the welfare of the working class, but the proposed changes have raised significant questions about the balance between worker rights and economic competitiveness.
The proposed changes in Karnataka's labour laws are not isolated. They are part of a broader trend of labor reforms being pursued by the central government and already implemented in some BJP-governed states. These reforms generally aim to make labor regulations more flexible, often with the stated goal of attracting investment and boosting economic growth. In Karnataka, a task force has been established, following a meeting on ‘Compliance reduction and deregulation’ championed by the Centre, to explore and implement further suggestions in line with this objective. Beyond the extension of daily work hours from nine to ten, the specific amendments to the Act under consideration include an increase in daily overtime work from one hour to two hours, as well as an increase in the maximum overtime hours allowed over three consecutive months, from 50 to 144. These changes represent a substantial alteration to the working conditions of many employees in Karnataka. The opposition from trade unions is largely based on the potential for exploitation and the negative consequences for worker well-being. The Karnataka State IT/ITeS Employees Union has vehemently criticized the proposal, describing the possibility of 12-hour workdays (including overtime) as “modern-day slavery.” The union argues that the amendment would incentivize companies to adopt a two-shift system instead of the current three shifts, potentially leading to job losses and increased pressure on existing employees. The JCTU, in its memorandum urging the withdrawal of the proposal, pointed to the example of Gujarat, where similar reforms led to a decline in registered establishments by 18%. The union also raised concerns about the already high graduate unemployment rate in Karnataka (32% according to AISHE 2023) and the potential for increased gender discrimination, given that women comprise 78% of the state’s retail workforce. They fear that longer working hours and fewer job opportunities could create a more hostile environment for working women. The JCTU predicts that the proposed changes could lead to a compression of the workforce by approximately 30%, exacerbating the unemployment crisis among young people in Karnataka. The union argues that the proposal violates the State’s own Labour Policy 2020, which guarantees an eight-hour work culture, highlighting the inconsistency between the proposed changes and the state's stated policy goals.
The current debate in Karnataka echoes similar controversies that have arisen in the past regarding labour law reforms. In May, the state government, acting on a directive from the Union government, attempted to modify shift hours under the Factories Act for workers. This move also encountered strong resistance from unions, ultimately leading the state government to shelve the proposed changes. This prior incident underscores the sensitivity of labour law issues and the importance of thorough consultation and consideration of the potential consequences before implementing any reforms. The core of the debate revolves around balancing the interests of employers and employees. Proponents of the proposed changes argue that they will enhance the ease of doing business, attract investment, and boost economic growth. They contend that greater flexibility in working hours will allow companies to operate more efficiently and respond more effectively to market demands. Opponents, on the other hand, emphasize the potential for exploitation, the negative impact on worker well-being, and the risk of job losses. They argue that longer working hours can lead to increased stress, burnout, and health problems, ultimately reducing productivity and creating a less desirable work environment. The economic arguments also center around the distribution of benefits: While some argue that increased productivity will create more jobs, others fear that companies will simply reduce their workforce to lower costs. The Karnataka government now faces the task of navigating these conflicting perspectives and finding a solution that addresses the concerns of all stakeholders. The upcoming Cabinet deliberations will be crucial in determining the future of labour laws in the state and their impact on the lives of millions of workers.
Source: Proposal on increasing work hours in Karnataka likely to be referred to Cabinet