Apprenticeship law needs more reforms

Part-time apprenticeship will allow students to pursue regular academic courses while undergoing job-training.

India’s skilling ecosystem has seen some policy impetus over the last decade, but persistent sclerosis in some areas has ensured there is little to write home about. Meanwhile, economies like Bangladesh and Vietnam (let alone skilling-leaders like Germany, Russia, etc) have deepened efforts meaningfully, and not just in industries like textiles and garments where they already present a significant challenge to India but also in more tech-forward sectors.

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Thus, the need for India to get skilling right, and quickly, just can’t be emphasised enough; else, our immense labour potential will simply be squandered. To that end, it is welcome the Union government is looking to reform the Apprenticeship Act further—this was announced in the Union Budget FY22, and Mint reports that the government is likely to present the amendment Bill in the monsoon session of Parliament.

The ministry of skill development had released a concept note in April, in which it had outlined several reform proposals. Key among these are changing the definition of ‘establishment’ to include educational institutions, recognition of apprenticeship through the virtual/online mode, allowing part-time apprenticeship, enhanced role for the third-party aggregators (TPAs), easing of penalties and ending apprenticeship contract approval in favour of contract ‘intimation’ to authorities.

The benefits of some of these proposed steps are obvious. Expanding ‘establishment’ would give apprentices more opportunities, even as higher education institutions hone their ability to orient courses towards job-market demands. This will also likely serve as a nudge towards the ‘sandwich courses’ model that most European nations follow. Apprenticeship in the virtual mode will mean youth in remote locations can access opportunities, especially in the services sector, including IT/ITeS and digital; the pandemic has made it clear that any job that can be moved to the digital/virtual mode would likely be moved.

Part-time apprenticeship will allow students to pursue regular academic courses while undergoing job-training. Enhanced role for TPAs, as the ministry note observes, will offer industry an easier route to compliance with the Act’s provisions, by removing the burden of procedural work; however, there is a need to avoid the middle-man trap, where TPAs merely serve as compliance vehicles without oversight of responsibilities.

The concept note does not include dedicated skill universities among reforms proposed though it acknowledges that this was a key suggestion during consultations with stakeholders. A skill university will require different treatment than that accorded to purely academic universities; the education regulator (the UGC/its successor, the HECI) needs to be sensitive to this. This will also call for, as Teamlease’s Manish Sabharwal has pointed out in these pages, an end to silo-ed thinking and working in turfs by the clutch of regulators whose oversight is mandated for this.

The proposal to have stipend-free apprenticeship will be big boost for industry participation, but apprentices’ interests also need to be guarded as well. More so in the backdrop of the move to increase the share of apprentices in a firm’s workforce, including for small businesses.

The move must not be allowed to become a route for exploitation of labour, especially in industries where there is a lot of low-value/low-skill work; while employers may not be needed to pay, there has to be oversight to ensure that apprenticeship stints are not reduced to mere execution of such work even as employers wrest compliance in the process. The concept note is also silent on the proposal of removing the distinction between designated and optional trades; this would allow both employers and apprentices greater choice.