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Quashing of Haryana’s Local Candidates Reservation Act 2020

Context:

The Punjab and Haryana High Court has declared the Haryana State Employment of Local Candidates Act, 2020 as unconstitutional, nullifying the mandated 75% reservation for local candidates in private sector jobs. The court ruled that the law violates fundamental rights of both citizens and employers.

Relevance:

GS II: Polity and Governance

Dimensions of the Article:

  1. Haryana Private Sector Quota Law
  2. Concerns Regarding Haryana’s Private Sector Quota Law
  3. High Court’s Ruling

Haryana Private Sector Quota Law

  • Enactment:
    • The Haryana State Employment of Local Candidates Act, 2020 was passed by the state government in March 2021.
  • Reservation Percentage:
    • Mandated a 75% reservation for local candidates in private sector jobs.
    • Applied to positions with a monthly salary below Rs 30,000 (originally Rs 50,000) for a period of 10 years.
  • Entities Covered:
    • Applied to various entities, including companies, societies, trusts, partnership firms, and large individual employers.
  • Employer Criteria:
    • Employers with 10 or more employees were subject to the law.
  • Central or state governments and their organizations were exempted.
Registration and Domicile Requirement
  • Employee Registration:
    • Employers required to register their employees on a government portal.
  • Domicile Certificate:
    • Local candidates needed a certificate of domicile to avail the reservation.
  • Local Candidate Definition:
    • A “local candidate” domiciled in the State of Haryana.
Objective and Intent
  • Employment Opportunities:
    • Aimed at providing job opportunities and skill development for local youth.
    • Focused on unskilled and semi-skilled workers.
  • Migration Control:
    • Intended to reduce the influx of migrants from other states into Haryana.

Concerns Regarding Haryana’s Private Sector Quota Law

Legal Challenge by Industry Associations

Petitioners:

  • Faridabad Industries Association and other Haryana-based associations approached the high court.
  • Contended that Haryana’s policy of “sons of the soil” infringed upon constitutional rights of employers.

Violation of Constitutional Rights:

  • Argument that the reservation policy infringed on the constitutional rights of employers.
  • Private sector jobs should be skill-based, and individuals have a fundamental right to work anywhere in India.

Federal Structure Concerns:

  • Asserted that forcing employers to hire local candidates violated the federal structure of the Constitution.
  • Viewed as contrary to public interest and benefiting only one class.
Haryana Government’s Defense

Legal Basis:

  • Haryana government argued that it had the authority under Article 16(4) of the Constitution to create such reservations.
  • Article 16(4) allows the state to provide reservations for backward classes not adequately represented in state services.

Protection of Rights:

  • Government stated the law was necessary to protect the rights of people domiciled in the state, including the right to life, livelihood, health, living conditions, and employment.

High Court’s Ruling

  • Inspector Raj Criticism:
    • Sections 6 and 8 of the Act, establishing reporting requirements and verification, criticized as creating an “Inspector Raj.”
    • Inspector Raj refers to excessive government supervision in industrial units.
  • Violations of Fundamental Rights:
    • Court ruled that the law violated the fundamental right to equality under Article 14.
    • Discrimination based on place of birth and residence.
  • Freedom of Trade and Commerce:
    • Violation of the fundamental right to freedom of trade and commerce under Article 19(1)(g).
    • Imposed unreasonable restrictions on employers, irrespective of merit and suitability.
  • Constitutional Vision Concerns:
    • Court expressed concern that the law could lead to similar enactments by states, creating unintended barriers against the Constitution’s vision.

-Source: The Hindu


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