The Punjab and Haryana High Court has done the right thing by quashing the Haryana State Employment of Local Candidates Act, 2020 that provides for 75% reservation to State domiciles in the private sector in jobs that provide a monthly salary of less than ₹30,000. The court stated that it was beyond the purview of the State to legislate on the issue and restrict private employers from recruiting people from the open market. It also held that the Act was violative of equality guaranteed under Article 14 and freedom under Article 19 of the Constitution. The court said that by allotting 75% reservation for “locals”, the Act militates against the rights of citizens of the rest of the country, and that such acts could lead to other States coming up with similar enactments, in effect putting up “artificial walls” throughout India. It argued that the Act was imposing unreasonable restrictions on workers’ right to move freely throughout the territory of India. The court termed the requirements on private employers stipulated in the Act as akin to those under “Inspector Raj”.
Other States such as Andhra Pradesh and Jharkhand have also enacted similar legislation. The Andhra Pradesh High Court observed that the State’s Bill, passed in 2019, “may be unconstitutional”, but it is yet to hear the case on merits. Workers move to other States seeking job opportunities that are relevant to their skills and abilities. If States build walls and impose restrictions that prevent job seekers from other States from accessing opportunities, citizens of poorer States will have to eke out a living within their own regions. This will affect the economy of the entire country. While legislation that seeks to reserve blue collar jobs for locals is problematic and unconstitutional, there is a reason why there is resentment among locals in better-off States over their jobs being taken up by “migrant” workers and which has compelled their governments to come up with knee-jerk protectionist measures. There are more than a few private employers who exploit the migrant labour market as such workers tend to work long hours for low wages with little or no social protection and benefits. This creates a segmentation of the labour market with low-wage migrant workers on the one side and local workers with better bargaining power on the other. If States are truly concerned about protecting workers’ rights, they should ensure that migrant workers in all establishments enjoy basic labour rights that are legally due to them, thereby creating a level playing field for all workers. This will also be a curb on exploitative practices by employers. Protectionism in the labour market is not the answer.