Mumbai, Feb 20 (KNN) Making an amendment to the Contract Labour (Regulation and Abolition) Act 1970, the Maharashtra Government has allowed factories employing less than 50 contract workers to function without registering themselves with the authorities concerned.

Talking to KNN, Mumbai based MSME entrepreneur Dinesh Chandra Tripathi who is the Managing Director of NSD Global Trade Private Ltd said, “Increase in the threshold from 20 to 50 is good. But it should have been increased to atleast 100.”

Explaining this, Tripathi, who is also a Chief Executive Member of industry body FISME, said, “SMEs have limited resources due to which they cannot spend much on automation. So for each work, they have to hire many workers. They atleast have 100 workers. So the limit should have been increased to minimum 100.”

The law department, according to a notification, has changed the Contract Labour (Regulation & Abolition) Act to make it applicable to establishments in which 50 or more workers are employed. This means units employing up to 49 workers will no longer come under its purview.

The reform is in keeping with the state's Make in Maharashtra campaign. The new law called the Contract Labour (Regulation and Abolition) Maharashtra Amendment Act 2016 had been passed in the assembly and signed by the governor.

However, some of the trade unions have said that because of the amendment, a large number of MSMEs will be out of the purview of the Act. But they said larger establishments will also employ four to five sets of 40 contract workers to avoid coming under this law.

This means employers will avoid providing statutory benefits, including provident fund, the minimum wage and leave to contract workers in smaller units.

Giving his opinion on this, Tripathi said government has made this provision to help MSMEs. “It cannot tell every unit what to do and what not to do.” (KNN Bureau)