Understanding State-Imposed Employment Reservations and Labor Rights

Understanding State-Imposed Employment Reservations and Labor Rights


The Punjab and Haryana High Court’s decision to annul the Haryana State Employment of Local Candidates Act, 2020, which mandated 75% reservation for State residents in private sector jobs below ₹30,000 monthly salary, has stirred discussions on the constitutional aspects of such laws.


GS – 2 (Social Empowerment, Government Policies & Interventions)

Mains Question:

Examine the constitutional implications of state-level laws that impose reservation quotas for local candidates in the private sector. (150 words)

Dimensions of the Article:

  • Constitutional Validity
  • State-imposed employment reservation
  • Other Highlights
  • Skill Development Initiatives in India

Constitutional Validity:

  • The court’s stance on the Haryana Act, emphasizing the violation of constitutional rights, particularly under Article 14 (equality) and Article 19 (freedom), opens a discourse on the constitutional validity of such reservation laws.
  • Article 14 of the Constitution of India guarantees equal protection of the law and equality before the law. Article 14 also allows for reasonable classification between likes and unlikes. This means that unlikes can be given special treatment to bring them on equal footing with likes.
    • Article 14 also guarantees equality of opportunity in public employment. It prohibits discrimination based on: Religion, Race, Caste, Sex, Descent, Place of birth.
  • Article 19 guarantees citizens the freedom to practice any profession, or to carry on any occupation, trade or business.

State-imposed employment reservation:

  • The Constitution allows the Union Government and the States and Territories of India to set reserved quotas or seats for “socially and educationally backward citizens”. These quotas can be set for: Education Admissions, Employments, Political Bodies, Promotions.
  • Some examples of state-imposed employment reservation include:
    • Scheduled Castes (SC): 15% quota in jobs and higher educational institutions
    • Schedule Tribes (ST): 7.5% quota in jobs and higher educational institutions
    • Madhya Pradesh: 35% of government job vacancies reserved for women and 50% of teaching positions
    • Punjab: 75% reservation for locals

Other Highlights:

  • The article highlights the exploitation of migrant workers and the resultant segmentation in the labor market.
  • Delving into the economic and social consequences of such segmentation can provide insights into the challenges faced by workers and the need for uniform labor rights.
  • Protectionism vs. Workers’ Rights: Analyzing the delicate balance between protectionist measures aimed at safeguarding local employment and the fundamental rights of workers to seek opportunities beyond their home states is essential. Discussing the reasons behind protectionist sentiments and potential alternatives to address worker concerns will enrich the analysis.

Skill Development Initiatives in India:

Pradhan Mantri Kaushal Vikas Yojana (PMKVY):

  • Launched in 2015, PMKVY is a flagship scheme providing short-term training and skill development through ITIs and apprenticeship programs.
  • Over 10 million youth have been trained under this scheme since its inception.


  • SANKALP focuses on district-level skilling ecosystems, while STRIVE aims to enhance the performance of Industrial Training Institutes (ITIs).

Initiatives by Various Ministries:

  • The Ministry of Skill Development and Entrepreneurship contributes about 55% to the overall skilling efforts. Approximately four crore people have been trained in various traditional skills programs since 2015.

Mandatory CSR Expenditure in Skilling:

  • Mandatory CSR spending under the Companies Act, 2013, has led to over ₹100,000 crores invested in social projects.
  • Approximately ₹6,877 crores have been allocated to skilling and livelihood enhancement projects, benefiting states like Maharashtra, Tamil Nadu, Odisha, Karnataka, and Gujarat.

TEJAS Initiative for Skilling:

  • TEJAS (Training for Emirates Jobs and Skills) is a Skill India International Project launched at the Dubai Expo 2020.
  • The initiative focuses on skilling, certification, and overseas employment of Indians, aligning the Indian workforce with skill and market requirements in the UAE.

Way Forward:

  • Instead of resorting to protectionist measures, states should focus on uniformly implementing labor rights for both local and migrant workers, creating a level playing field and mitigating exploitative practices.
  • Ensuring that migrant workers enjoy basic labor rights and social protections will contribute to a fair and equitable labor market.
  • As per the 2015 report on National Policy on Skill Development and Entrepreneurship, only 4.7% of the total workforce in India had undergone formal skill training compared with 52% in the US, 80% in Japan, and 96% in South Korea. Hence, more investment in skill development programs to enhance the employability of local candidates, addressing concerns about job opportunities should be taken care.