Regulations

THE APPRENTICES (AMENDMENT) ACT, 2014

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  • The Apprentices (Amendment) Bill, 2014 was introduced in Lok Sabha on August 7, 2014.  It proposes to amend the Apprentices Act, 1961.
  • The Act regulates the training of apprentices in the industry.  An Inter Ministerial Group (IMG) had recommended various changes to the Act to make apprenticeship more responsive to youth and industry.  The Statement of Objects and Reasons states that the amendments proposed in the Bill are based on IMG’s recommendations.
  • Definitions:  The Bill amends the definition of appropriate government to include an establishment operating in four or more states to be regulated by the central government.  It also amends the definitions of: (i) designated trade, (ii) graduate or technician apprentice, (iii) trade apprentice, (iv) industry and (v) worker.  The Bill adds two definitions: (i) optional trade, and (ii) portal-site. Read more

 

         Apprentice Amendment Rules-2015

       

HIGHLIGHTS OF THE AMENDMENT RULES

  •  Number of apprentices

An employer falling under the purview of the Apprentices Act, and who has 40 or more employees, is now obligated to appoint between 2.5% to 10% of the average strength of the workforce in the preceding financial year as apprentices for each financial year. Interestingly, contract workers are also included to calculate the strength of the workforce.

Further, establishments are required to disclose the number of apprentices they intend to engage in each quarter.

  •  Engaging apprentices from Scheduled Castes, Scheduled Tribes and Other Backward Classes in designated trades

The requirement to reserve a certain number of places for apprentices from Scheduled Castes, Scheduled Tribes and Other Backward Classes existed even prior to the Amendment Rules. However, the ratio has changed according to Schedule II-A of the Apprenticeship Rules. In some states such as Karnataka and Maharashtra, the ratio has increased, in some states such as Delhi it has remained the same and in others it has even decreased.

Earlier there were no specific guidelines on engaging individuals from Other Backward Classes as apprentices, but the Amendment Rules suggest that this will be in accordance with the norms followed in the relevant state or union territory.

  •  Introduction of optional trades

or to the amendments, employers could only engage apprentices in ‘designated trades’ which are specifically notified, such as carpentry, data preparation and computer software, programming and systems administrative assistant, etc. Now, in addition to the designated trades, an employer can also engage apprentices in an ‘optional trade’ i.e. a trade or a field which has not already been ‘designated’. For apprentices engaged in an optional trade, the employer has more flexibility to decide the duration of the apprenticeship (subject to certain parameters set out in the Amendment Rules), identify the proposed syllabus for training these apprentices, etc.

  •  Inclusion of non-engineering apprentices and related discrepancies

Prior to the Amendment Act and the Amendment Rules, graduate or technician apprentices only included individuals holding (or undergoing training to hold) a degree or diploma in engineering or technology. The scope has now been expanded to include even non-engineering degree holders and diploma holders.

However, it is relevant to note that, unlike in the case of engineering degree and diploma holders (for whom the Government reimburses the employer for 50% of the minimum stipend), the Government will not contribute towards the stipend for such non-engineering degree holders and diploma holders. Further, there is no clarity yet on the exact qualifications or designated trades for such apprentices.

In light of the increased focus on this legislation, it is important for employers to assess their compliance status, since there may soon be a greater shift towards implementation. Read More