Karnataka’s proposed changes in labour law aimed to push investments from likes of Foxconn, Wistron

The state’s legislature last month passed a Bill to amend the Factories Act, 1948, proposing to increase the time an employee can work on the shopfloor in a day to 12 hours from nine, with breaks. Without a break, it can be up to six hours in a day.

The amendment has retained the weekly cap at 48 hours, which an employee can meet in four days and get three days of paid holiday.

Another change to the law allows factories to deploy women on night shifts with necessary safeguards.

The changes, however, will have to wait. They can take effect only after the Bill is signed by Karnataka’s governor and the President of India, and notified by the government.

Karnataka is trying to adopt modern labour practices as followed in some of the western countries and in China to emerge as a winner in cutting-edge electronics and semiconductor sectors.

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The state’s labour minister, A Shivaram Hebbar, said the proposed changes in the law would help increase economic activities and create more jobs.The government proposed the amendments in response to requests from industry bodies, state industries department principal secretary S Selvakumar told ET.

Workers in high-end electronics manufacturing typically work longer hours in a day, and two shifts of 12-hour cycles would benefit them and the employers.

The changes may make life easier for investors in these emerging sectors, additional labour commissioner G Manjunath said, quoting from the discussions his department had prior to drafting the Bill.

Quite a few countries in Europe and the Middle East have either cut down weekly working hours or are moving towards that, as experts believe it may increase productivity.

In Karnataka, electronics and semiconductor industry leaders had conveyed to the government that the process is seamless and continuous at high-end tech manufacturing and three-shift cycles come with their own set of challenges, the official said.

Karnataka, last week, signed an agreement with Foxconn, the biggest contract electronics manufacturer, encouraging it to set up an electronics manufacturing and assembly unit on the outskirts of Bengaluru where it is expected to invest up to $1 billion and make iPhones for Apple.

Karnataka has been projecting itself as a key destination for investment in electronics system design & manufacturing.

Officials believe an investment by Foxconn would help Karnataka attract many other frontline global electronics companies to the state.

Foxconn’s increased India push is triggered by strong domestic demand for iPhones as well as a surge in exports from India, led by the diversification of global supply chains away from China.