Karnataka’s job quota bill for locals: Industry is furious

• Karnataka is making headlines! No, not for solving the traffic issue in Bangalore but for passing a job quota bill for locals (Kannadigas).
• Here is the rundown.

What’s happening in Karnataka?

‘The Karnataka State Government Employment of Local Candidates in Industries Bill, 2024’ seeks to revolutionize employment opportunities in the private sector by introducing a reservation system.

The Karnataka government has proposed a reservation quota bill for local residents in industries, factories, and other establishments across the state.

Reservation Targets

And it is not a mere 10% – 20% quota, but a whopping:

Managerial positions: 50%

Non-managerial positions: 75%

Who is a Karnataka ‘Local’? 

The bill specifies that a ‘local’ candidate must be born and domiciled in Karnataka for at least 15 years.
Additionally, they must be proficient in Kannada, both in reading and writing.

And, they must possess a secondary school certificate with Kannada as a language. Candidates lacking this qualification must pass a Kannada proficiency test as set by the nodal agency.

Training Mandate 

What happens if a private sector company cannot find a competent local for the position?

In that case, as per the bill’s requirements, industries must train those locals within three years and make them job-ready to fill those reserved positions.

For special cases, the Bill proposed to reduce reservations to 50% in non-management and 25% in management jobs.

Penalties for Non-Compliance

If a company fails to comply with the said law, the bill can impose fines between ₹10,000 and ₹1 lakh for violations to uphold the law.

If the violation persists after the penalty has been applied, an additional penalty of up to one hundred rupees per day may be imposed for each day that the violation continues.

Additionally, offences must be prosecuted within six months to comply with the rules.

Industry outrage

Needless to say, this proposal has created an uproar in the industry.

The National Association of Software and Service Companies (Nasscom) has voiced serious concerns about the Bill, urging the state to withdraw it.

In a statement released on X, Nasscom said,

“The Bill’s provisions threaten to reverse this progress (in Karnataka), drive away companies, and stifle startups, especially when more global firms (GCCs) are looking to invest in the state. At the same time, the restrictions could force companies to relocate as local skilled talent becomes scarce.”

Amidst all this controversy over the bill, Andhra Pradesh minister Nara Lokesh extended a warm invitation to IT firms to move their businesses to Vizag.

He emphasized that Andhra Pradesh is fully prepared with highly skilled talent for IT ventures, without any government restrictions.

Talk about a silver lining!

The government has put the bill on hold…for now

Following strong opposition from top CEOs and industry bodies, the Karnataka government has decided to put a hold on the proposed law.

Chief Minister Siddaramaiah on X said,

“The draft Bill intended to provide reservations for Kannadigas in private sector companies, industries, and enterprises is still in the preparation stage.

A comprehensive discussion will be held in the next cabinet meeting to make a final decision.”