UPSC Prelims 2019 Q60: Indian Economy – Human Development, Poverty & Employment Schemes
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Answer: (c) Both 1 and 2
Explanation
Industrial Employment (Standing Orders) Central (Amendment) Rules, 2018: Fixed-Term Employment
| Statement | Claim | Verdict | Detail |
|---|---|---|---|
| 1 | Fixed-term employment makes it easier to lay off workers | TRUE | Fixed-term employees can be hired for a specified period and their contracts end automatically without triggering retrenchment procedures under the Industrial Disputes Act. This reduces layoff friction and compliance costs. |
| 2 | No notice required for termination of temporary workman | TRUE | The 2018 amendment permits termination of temporary/fixed-term workmen at end of contract without any prior notice - contract expiry is the trigger. |
Both statements are correct. Answer: (c) Both 1 and 2.
Answer: (c) Both 1 and 2.
Why each option is right or wrong
- (a) Incorrect. Statement 2 is also correct.
- (b) Incorrect. Statement 1 is also correct.
- (c) CORRECT. Fixed-term employment (2018 amendment) makes layoffs easier by ending contracts on their own terms, and requires no notice for termination of a temporary workman at the end of the contract.
- (d) Incorrect. Both statements are true.
Key point
Fixed-term employment (2018 amendment): Contract auto-ends at term expiry. Employer avoids IDA retrenchment process. No prior notice needed. Fixed-term worker gets same wages/benefits as permanent for the term.
Remember
Both statements are correct. Under the Industrial Employment (Standing Orders) Central (Amendment) Rules, 2018, fixed-term employment provisions make it easier for firms to end employment relationships (contract auto-ends), and no prior notice of termination is necessary for a temporary workman at the end of the contract term.
Common mistakes
- Assuming fixed-term contracts always get gratuity - only if 5+ years of continuous service (recently extended pro-rata to fixed-term).
- Confusing fixed-term with contract labour - fixed-term hires are direct employees, contract labour is via contractor.
- Not knowing fixed-term provisions were extended to ALL sectors by the 2018 amendment (earlier restricted).
Exam tip
Labour code consolidation (2019-20): Industrial Employment (Standing Orders) Act 1946 was subsumed into Industrial Relations Code, 2020. Fixed-term employment is now enshrined across all sectors. Similarly Wages Code, Social Security Code, OSH Code consolidate 29 labour laws.
Sources
- Industrial Employment (Standing Orders) Central (Amendment) Rules, 2018
- Ministry of Labour - Notifications on fixed-term employment