Date : 23/11/2023

Relevance: GS Paper 2- Social Justice- Reservation

Keywords: The Haryana State Employment of Local Candidates Act, 2020, Article 15, Article 16, Pro - Market Policies, Local Industries

Context-

The Punjab and Haryana High Court recently took a decisive step by quashing the Haryana State Employment of Local Candidates Act, 2020. This legislation, which aimed to provide 75% reservation to state domiciles in the private sector, faced legal challenges on the grounds that it exceeded the state's authority and infringed upon the rights of citizens from other regions.

The court's verdict underscored the potential dangers of such laws, warning against the creation of "artificial walls" within India.

The Law and Its Challenge:

• The Haryana State Employment of Local Candidates Act, 2020, passed in November 2020, mandated a 75% reservation for residents of Haryana in private sector jobs offering a monthly salary of less than Rs 30,000. The Act covered a wide range of entities, including companies, societies, trusts, and various types of employers with a workforce of 10 or more.
• The Faridabad Industries Association and other Haryana-based associations challenged the law, contending that it violated constitutional rights. They argued that private sector jobs should be based on skills and merit, asserting that individuals have a fundamental right to work anywhere in India. The petitioners emphasized that such legislation undermined the federal structure of the Constitution, creating a hierarchy of citizens based on their place of residence.
• The Haryana government defended the law, citing Article 16(4) of the Constitution, which allows for reservations in public employment. However, the court ultimately held that the Act infringed upon the constitutional rights of citizens and violated the concept of constitutional morality.
• Similar laws exist in other states like Maharashtra, Karnataka, Andhra Pradesh, and Madhya Pradesh, all facing legal challenges. The constitutional debate revolves around the tension between Article 16(2), which prohibits discrimination based on place of birth or residence in government jobs, and Article 16(4), which allows for reservations to address underrepresentation.

Constitutional Implications and Challenges:

• The legal battle raises crucial questions about the constitutional rights of citizens. While Article 16(4) permits reservations in public employment, the fundamental rights enshrined in Article 19(1)(g) provide all citizens with the right to engage in any profession, trade, or business. Imposing domicile-based limitations infringes upon this individual right, as highlighted by the High Court.
• The court's decision emphasized that the Act created a secondary status for citizens outside Haryana, violating the principles of constitutional morality. Additionally, it questioned the state's authority to curtail the fundamental rights of individuals not belonging to Haryana.

Arguments in Favor of Domicile Reservations:

• Supporters of domicile reservations argue that these laws ensure adequate representation and opportunities for local residents in both public and private sectors. Proponents contend that such measures can address unemployment and secure livelihoods, especially in states with high unemployment rates like Haryana.
• Haryana's unemployment rate, the fourth highest in the country at 9%, justifies the need for affirmative action to empower the local population. Domicile reservations are seen as a means to protect cultural and linguistic identities, fostering a sense of belonging and loyalty among residents.
• Furthermore, proponents view domicile reservations as a form of social justice, offering disadvantaged sections of society opportunities they might lack in other states. By prioritizing natives, state governments aim to elevate the social and economic status of their residents.

Arguments Against Domicile Reservations:

• Critics argue that domicile reservations violate the fundamental rights of citizens to move freely and work anywhere in India, as guaranteed by Article 19(1)(d) and (e). They contend that labor mobility is essential for economic growth and that industry should have the flexibility to hire based on merit, not domicile status.
• The migration of labor has historically contributed to building and sustaining the economies of industrialized states. Arbitrary restrictions on hiring practices may hinder the private sector's ability to access a skilled and diverse workforce, potentially discouraging investment and development in the state.
• Moreover, opponents assert that domicile reservations are counterproductive and do not address the root causes of unemployment. Instead, these laws are seen as populist and protectionist measures that could lead to balkanization of the labor market, contrary to the vision of an integrated and mobile labor market in India.

Alternative Solutions:

Instead of imposing mandatory quotas, alternative solutions could strike a balance between local interests and constitutional freedoms:

• Pro-Market Policies: Advocate for pro-market policies that create a conducive environment for private sector growth, including reducing regulatory hurdles, providing incentives, ensuring fair competition, and transparency.
• Human Development Focus: Invest in human development by enhancing the skills, education, and employability of local candidates through initiatives such as quality education, vocational training, skill development, and entrepreneurship.
• Stimulus Packages: Provide stimulus packages that offer financial and social support to local candidates affected by unemployment, including schemes such as unemployment allowance, job guarantees, and social security.
• Incentives for the Private Sector: Offer incentives and subsidies to private sector entities that voluntarily employ local candidates, encouraging compliance without imposing mandatory quotas.
• Promote Local Industries: Promote the development of local industries and sectors with high demand for local candidates, creating more job opportunities and fostering economic growth for the state and its people.

Way Forward

• The reservation policy could be implemented in a way that does not hamper the free movement of manpower resources in the Country.
• The reservation policy could be revisited periodically to assess its impact on the economy and industries in the state.
• It is important to ensure that any policy decision taken is in compliance with the Constitution of India and does not violate the fundamental rights of citizens.
• The best way to grow out of Job for Locals Legislations (JRFL) attempts of various state governments is to ensure economic recovery and provide enough job opportunities for youths with skill training and proper education as key focus areas, enabling the masses to compete in the free market

Conclusion:

The debate surrounding domicile reservations in private employment in India requires a delicate balance between local interests and constitutional freedoms. Proponents argue for representation and cultural preservation, while critics highlight constitutional concerns and potential economic drawbacks. Exploring alternatives such as pro-market policies, targeted incentives, and promoting local industries is crucial for a constructive path forward. The resolution of this debate will significantly shape the trajectory of employment policies in India, impacting the delicate balance between local aspirations and the broader vision of a united and mobile labor market.

Source- Indian Express