Locals First Policy for Job – What, Why, Merits and Demerits

locals-first-policy-for-job-upsc

Recently, the Haryana government announced its policy of reserving 75 per cent of the State’s jobs in the private sector for candidates who are domiciled in the State. This is not a new case as the Andhra Pradesh government had passed similar legislation in 2019 and many States in India are in the line to enact such legislation to ensure employment to its unemployed population. The recent trend of ‘the locals first’ policy in job is more about fulfilling poll promises than ensuring job to the unemployed and it has several implications for the State, and the country as a whole. It not only acts as a hurdle to the hopes of the inter-state migratory population but also brings into question some of the constitutional dimensions which grant certain rights to all the citizens of India.

Locals First Policy for Job mindmap

What is the ‘Locals First’ policy?

The policy implies that any job that is created in a State in India will be offered to the local population in the State first and then only residents of other States have the right to that job.

Why is the need for such a policy?

With the rising population and development of industries, a large number of people are left unemployed. Many people are deprived of their livelihood and displaced due to land acquisition. Although the new developing industries promise to employ the local population yet they seldom fulfil the promises. These things cause dissatisfaction among the local community residing there and lead to the rise in demands for reservation of jobs for the local population.

Most probable and repeated topics of upsc prelims

Merits

  • Ensuring job to the unemployed – Such policies ensure employment opportunities for local people who live in that State. The States which have their economy transitioning from an agro-based to industry-based have a lot of people left unemployed. These policies help unemployed people to earn their livelihood.
  • Reduction in absenteeism – As this policy allows employers to hire local people for work, it reduces dependence on migrant labourers and thus reduces worker absenteeism.
  • Sharing of responsibilities – The private sector is utilising all the facilities that the government offers(infrastructure, subsidized land and easy availability of credit). In such a case, if such legislation makes the private sector share the burden of public welfare through employment, there is nothing wrong with it.
  • Enhanced efficiency – Since the workers are available locally, it reduces absenteeism and thus enhances efficiency.

Demerits

  • Increased informalization of the labour market – In a time when formalization of the labour market is a need of the hour, this may promote informalization. This informalization may lead to the exploitation of local labourers and they may fall out of the required social security net.
  • Increased burden on the employer – The employers have to spend a sufficient amount of time and resource in searching and verifying appropriate candidates. This may increase the compliance burden on the employer.
  • Negative impact on foreign investment – This will have a direct impact on foreign investment as companies will not be willing to share the raised burden of compliance and may not find skilled labour in the local area. Their profits may also suffer which will drive them away from these places having such legislation.
  • Deliberate distortion in job vacancies – The companies may prefer to reduce the notified vacancies to evade fulfilling the required quota of workers to be hired from that particular State. This may have an adverse effect. Instead of creating employment opportunities, it will rather reduce the employment rate in a State.
  • Increased scope of bureaucratic intervention and corruption – It may also give rise to bureaucratic hassles and ‘inspector raj’ by giving a substantial right to the government officials to check and verify if the laws are being adhered to. The government officials may abuse the power and an era of red-tapism will usher in. It will also lead to corruption at both levels.
  • Loss to the government exchequer – If the companies prefer to move out of that particular State then it will be a loss to the government’s revenue which will impact the welfare measures undertaken by the government.
  • Delay in development of underdeveloped States – Those areas which are underdeveloped but have the scope of development may suffer from such legislation. This is because any company which will try to establish its centres in these areas will need skilled labour and if the area does not offer it, they may prefer to recruit skilled labours from other States. This kind of legislation may hamper their planning and targets and they may not prefer to establish their centres in such areas.
  • Detrimental to overall economic growth – With India’s expanding manufacturing capacity, there is a need for free mobility of labour and such laws may harm free labour movement. This may increase poverty and will be detrimental to the overall economic growth of the nation.

What does the Constitution say?

The Constitution of India guarantees freedom of movement and consequently employment within India through several provisions.

  • Article 14 provides for equality before law irrespective of place of birth. Given this, such a law will violate this provision of the Constitution as this legislation will not treat people from other States equally. The law will give preference to those who are domiciled in that particular State.
  • Article 15 guards against discrimination based on place of birth. Giving preference to the domiciled population of a particular State is in complete violation of this provision of the constitution.
  • Article 16 of the Constitution, which guarantees equal treatment under the law in matters of public employment, prohibits the state from discriminating on grounds of place of birth or residence.
  • However, Article 16(3) of the Constitution provides an exception by saying that Parliament may make a law “prescribing” a requirement of residence for jobs in a particular state. But this power vests solely in the Parliament, not State Legislatures. On this note, States making such laws is a violation of the constitutional provision.
  • Article 19 ensures that citizens can “move freely throughout the territory of India”. If people from other State will not be employed in some States on the grounds of place of birth, their right to move freely within the territory of India will be violated.
  • The Constitution prohibits reservation based on domicile because when the Constitution came into existence, the different geographical units were merged into one unit, India and India opted for single citizenship which means all are equal irrespective of any State they are born in. The essence of equality law is that there will be no discrimination among equals and such legislation violates this very essence.

What do the courts say?

  • In 1984, in Dr Pradeep Jain v Union of India case, the issue of “sons of the soil” was discussed and the Supreme Court expressed its opinion that such policies would be unconstitutional but did not expressly rule on it as the case was on different aspects of the right to equality.
  • In 1995, in Sunanda Reddy v State of Andhra Pradesh case, the Supreme Court affirmed the observation of the Pradeep Jain case to strike down a State government policy that gave 5% extra weightage to candidates who had studied with Telugu as the medium of instruction.
  • In 2002, the Supreme Court invalidated the appointment of government teachers in Rajasthan in which the state selection board gave preference to “applicants belonging to the district or the rural areas of the district concerned”.
  • In 2019, the Allahabad High Court struck down a recruitment notification by the UP Subordinate Service Selection Commission which prescribed preference for women who are “original residents” of the UP alone.

Way forward

The policy is a renewed version of nativism in India. Such policies have implications for the entire nation. Given the situation where the government is trying to integrate the whole nation through various measures like GST(Goods and Services Tax), such laws may act against these goals. It will not only affect private investment but also hamper industrial development. It is time that the States introduce other affirmative actions to provide employment rather than taking such short-sighted measures. Regional particularities must be considered in certain jobs as proficiency in the local language is important for smooth functioning but such artificial barriers may hamper the market which is in constant need of skilled workers. Therefore, nativism is not the answer but proper planning by all the stakeholders is.

Practise question

  1. What do you know about the ‘Locals First’ policy and what are its implications?
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