News Excerpt:

Jan Vishwas Bill 1.0 recognised the distrust issue of employers regarding regulatory burdens in labour laws but couldn’t do enough. A Jan Vishwas 2.0 aiming to accelerate job creation is needed.

Excessive regulations in the context of employer-related labour laws:

• The Factories Act 1948, read with 58 rules, contains more than 8,682 imprisonment clauses. 
• Other simpler laws: 
• The Legal Metrology Act, 2009, read with 29 rules, has 391 imprisonment clauses; 
• Electricity Act, 2003, read with 35 rules, has 558; 
• Motor Vehicles Act, 1988, read with nine rules, has 134. 
• Overall, there are 25,000+ employer jail provisions, of which 5,000+ arise from central legislation.
• The regulatory burden, including thousands of compliances and filings:
• Leads to corruption as civil servants and political leaders misuse the loopholes in the labour laws for personal gain.
• Punish the high-productivity enterprises that pay high wages by combining technology, capital, and skills and promote informal enterprises.

Role of Jan Vishwas Bill in tackling the employer distrust regarding labour laws:

• Jan Vishwas Bill 1.0 tackled the issue with:
  • Innovation- Single law amending many laws. 
  • Judgement- Keeping “good” jail provisions that deter or deliver consequences for bad behaviour while eliminating “bad” jail provisions that discourage good behaviour.
  • Stamina: constructing the list of 113 “bad” jail provisions eliminated for employers by asking each central ministry to reflect on their criminal provisions and voluntarily surrender the bad ones.
• But only about 4% of the 678 Central Acts that matter to employers were touched.
  • Consequently, only 2% of 5,239 jail provisions in central legislation were removed by Jan Vishwas.

Way Forward:

• There is a need for Jan Vishwas 2.0 to implement a new strategy for filtering decriminalization that shifts from retail (ministry’s volunteering) to wholesale (a positive list).
• A government committee should identify criteria where jail for employers is merited, like harm to others, theft from employees, etc. 
• Subsequently, every central ministry must remove all the 5,000+ jail provisions that do not meet the committee’s criteria.
• A fertile habitat for job creation hardly implies zero compliance, filings or jail provisions.
• Excessive regulatory burden hurts productive and compliant employers which can be reduced through civil service reform.
• A new wholesale strategy for amendments to the Jan Vishwas Bill will deliver lower corruption, higher wages and productive enterprises.