The Gujarat government has brought in an ordinance which now allows industrial establishments with 300 or less workers to lay them off without prior permission from the state government.
The move is aimed at making labour laws more flexible. The ordinance was used to amend the Industrial Disputes Act 1947.
Meanwhile, the Gujarat government has also made it mandatory for the units to provide a three-month notice period.
It has done away with the provision that allowed employers to provide three months’ wages in lieu of the notice period before being retrenched.
“To ensure that the employer shall only give notice of three months to such workmen, the provision to give wages for the notice period in lieu of the notice is proposed to be deleted,” the ordinance adds.
It has also said that the retrenched workers of any industrial unit will have to be paid by their employer an amount equivalent to the last three-month average pay.
This is in addition to the compensation the worker is already entitled to under the law.