With the Karnataka government deciding to delay the implementation of a bill mandating job reservation for locals in the private sector for further deliberations, staffing agencies and human resources (HR) experts say the focus should be on enhancing skills and productivity rather than “erecting artificial barriers”.
The Karnataka cabinet approved the draft State Employment of Local Candidates in the Industries, Factories and Other Establishments Bill, 2024, mandating 50 percent of management jobs and 70 percent of non-management roles to be reserved for local candidates (Kannadigas).
The state cabinet also approved a 100 percent quota for Kannadigas in Group C and Group D jobs (blue-collar workers) in the private sector.
“The current need is to emphasise skill development to address the gap between available opportunities and the requisite skills for employability. It is vital that a thriving state like Karnataka is founded on the principles of meritocracy. Although the state's growth in manufacturing, services, and related industries has resulted in significant migration, the focus should be on enhancing skills and productivity rather than erecting artificial barriers,” said AR Ramesh, CEO of TeamLease Degree Apprenticeship.
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As the epicentre of India's IT revolution, he warned that Karnataka risks unsettling national and international tech giants that rely on a skilled workforce.
Similarly, Aditya Narayan Mishra - MD and CEO of CIEL HR Service, said that if the bill is adopted, companies would need to track employees' domicile status for recruitment and internal mobility, increasing operational costs and complexity.
“This might prompt businesses to relocate to more operationally favourable states. Previous attempts by other Indian states to prioritise local residents have proven ineffective for similar reasons,” he added.
Sonica Aron, Founder of HR firm Marching Sheep, opined that because of the limited pool, it may be more difficult for companies to discover candidates with the precise qualifications and experience they require.
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“This would impact the ability to hire on time, leading to productivity loss, as well as making the hiring process prolonged and costlier. On the other side, this would also impact job aspirants from other states and regions,” she said, adding that organisations thrive on creativity and innovation due to diversity in the workforce and this will limit regional diversity.
On July 17, the National Association of Software and Service Companies (Nasscom) demanded scrapping of the bill, saying it would force businesses to relocate.
The industry body further said the bill threatened to reverse progress, drive away companies and stifle start-ups, especially when more global firms, such as Global Capability Centers (GCCs), were looking to invest in the state.
Former Infosys CFO TV Mohandas Pai also slammed the draft bill.
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"This bill should be junked. It is discriminatory, regressive, and against the Constitution. 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 must take a language test?" he wrote on X.
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