Trade unions, experts raise red flag over modified retrenchment clause

‘The provision in the new labour codes notified on Friday to increase the threshold for requiring the government's approval for undertaking retrenchment, layoffs, and closure’ to 300 workers from 100 workers at present has drawn criticism from certain trade unions and observers.

- SHIVA RAJORA

However, overly rigid labour laws have historically made firms wary of growing beyond certain sizes, as crossing low statutory thresholds exposes them to intrusive approvals, higher compliance burdens, and reduced flexibility in managing their workforce.

Tapan Sen, general secretary, Centre of Indian Trade Unions says that the new Industrial Relations code ‘cripples’ the right to strike by imposing various conditions, for all sectors, banning strikes during and after conciliation and extending restrictions across all establishments.