Industry Furious After Karnataka Brings 100 pc Reservation In Pvt Firms, Raises Concern

Bengaluru: The Karnataka government's approval of a bill proposing to reserve 50% of management positions and 75% of non-management positions in the private sector for locals has sparked criticism from industry leaders. They argued that the move is discriminatory and expressed concerns about potential adverse effects on the tech industry.

On Wednesday several industry leaders in the state objected to the move saying that it is "discriminatory" and raised apprehensions that the tech industry may suffer.

Earlier on Tuesday, Chief Minister Siddaramaiah announced that the Karnataka cabinet has passed a bill requiring full reservation for Kannadigas in the private sector for Group C and D positions. The decision was made during Monday's Cabinet meeting. Siddaramaiah took to X and said, “The Cabinet meeting held yesterday (Monday) approved a bill to make recruitment of 100 per cent Kannadigas mandatory for 'C and D' grade posts in all private industries in the state.”

"We are a pro-Kannada government. Our priority is to look after the welfare of the Kannadigas," he said.

Industry fumes as Karnataka govt moves bill 

Mohandas Pai, the Chairman of Manipal Global Education Services said that the Bill is "fascist" and also unconstitutional. "This bill should be junked. It is discriminatory, regressive and against the constitution @Jairam_Ramesh is govt to certify who we are? This is a fascist bill as in Animal Farm, unbelievable that @INCIndia can come up with a bill like this- a govt officer will sit on recruitment committees of the private sector? People have to take a language test?" Pai said in a post on 'X'.

Kiran Mazumdar-Shaw, the Executive Chairperson of Biocon Limited said that the state should not let this Bill affect its leading position in the domain of technology and there should be exemptions for highly skilled recruitment.

"As a tech hub, we need skilled talent and whilst the aim is to provide jobs for locals we must not affect our leading position in technology by this move. There must be caveats that exempt highly skilled recruitment from this policy," Shaw posted on 'X'.

What does the Karnataka Reservation Bill say?

The Bill drafted by the Labour Department claimed that jobs of industries operating in the state are going to the states of North India. The Bill states that industries that get infrastructure including land and water from the state should give reservations for jobs to the locals, and this has been approved in the cabinet meeting.

• The bill mandates that 50% of management roles and 70% of non-management roles in industries, factories, or other establishments must be filled by local candidates.
• Candidates without a secondary school certificate in Kannada must pass a Kannada proficiency test specified by the 'Nodal Agency'.
• If sufficient local candidates are unavailable, establishments must collaborate with the government or its agencies within three years to train them.
• Establishments can apply for government relaxation if local candidates are insufficient, with specified minimum relaxations.
• Every industry must report compliance with the Act's provisions to the nodal agency within prescribed timelines.
• The nodal agency will verify employer reports and submit compliance reports to the government, with authority to access employer records.
• An officer not below the rank of Assistant Labour Commissioner may be appointed as the authorised officer for Act compliance.
• Violations of the Act may result in penalties ranging from Rs 10,000 to Rs 25,000 for employers, with additional daily penalties for continued non-compliance.

According to sources in the law department, the 'Karnataka State Employment of Local Candidates in Industries, Factories, and Other Establishments Bill, 2024' is set to be presented in the Assembly on Thursday.