Job Quotas In Private Sector?

Rather than a blind reproduction of the government template, a more productive way of enforcing affirmative action in the private sector could be to emulate an American model, suggests Kanika Datta.

With India in permanent election mode this year, expect an exponential growth in the demands for higher quotas in government jobs and educational institutions as more communities suddenly discover their backwardness.

Some years ago, it was Patels, Marathas and Jats.

This time, with Karnataka polls looming, Vokkaligas and Lingayats, the two dominant castes in the state, were gifted higher percentages by the state cabinet.

Down in West Bengal recently, Kurmis blocked railway lines to add muscle to their petition for Scheduled Tribe status.

When growth in the job market is all but non-existent and many communities find themselves increasingly excluded or once prosperous communities struggle to adjust to structural shifts in India’s economy, these demands are understandable.

That political parties acquiesce to such importuning so readily is, however, risible.

Since the government has been shrinking, the pool of jobs open to any Indian, let alone a citizen hailing from one of the many special categories, is narrowing too.

That also goes for seats in educational institutions, where the government has steadily abdicated its responsibilities to the private sector.

So, really, it’s easy to promise what you can’t provide.

One unanticipated but almost inevitable corollary to this reality is that, sooner or later, the private sector is likely to get caught in the undertow of the reservations wave.

The trend is visible in several states that require private companies to reserve jobs based not on caste but domiciliary status — Haryana, Maharashtra, Andhra Pradesh, Karnataka, Madhya Pradesh.

Some of these intentions are still in the realm of announcements and others have been challenged in various courts, but it is possible to see a future where the private sector will have to confront the issue, regardless of which party or politician is in power.

Inasmuch as he can be considered as speaking for the Congress party, Rahul Gandhi recently dusted down from the shelves a 2014 election manifesto that promised to pass legislation for job reservations for Scheduled Castes and Scheduled Tribes in private companies based on a certain investment criterion and in private schools and educational institutions.

This got some additional heft in 2016 when the National Commission for Backward Classes recommended that 27 per cent of OBC reservation must also be extended to the private sector.

Since then, several prominent non-ruling party politicians have recognised the reality that government jobs are drying up and pointed to the need to allow OBSs to participate in private sector prosperity.

In fact, when it comes to the notion of co-opting the private sector to achieve the government’s developmental goals, the Congress has a jumpstart on other parties.

In 2013, it introduced the Corporate Social Responsibility mandate stipulating that companies with a specified turnover, net worth or net profit must spend 2 per cent worth of their average net profit of the preceding three years in areas that the government designated.

These issues cover the same ones that conventionally fall within the government’s purviews: Poverty, hunger, malnutrition, drinking water, education, protecting the environment and national heritage and so on.

Under the Manmohan Singh government this mandate was somewhat lightly monitored under a spend-or-explain approach.

Despite the pro-business image that the Narendra Modi government has cultivated, it did not scrap this mandate.

Instead, it doubled down, imposing a fairly steep penalty on companies and their officers that did not comply with the CSR mandate, this being a dilution from the original plan to treat CSR violations as criminal offences.

No matter that India’s human development indicators haven’t moved appreciably despite all this assiduous attention to CSR.

The CSR mandate, though irksome, does no real harm. Caste- and class-based reservation will be a far more tricky issue for India Inc to negotiate.

Honchos who are paid-up members of the old-boys’ club and family businesses that make up India Inc see no contradiction in arguing for the sanctity of merit-based systems in business.

Much of their objections centre on the fact that those seeking job reservation tend to be under-educated.

That provides a good argument for introducing reservations at elementary school level, but until the government amends its own policy of universal education, it would be unfair to exact private schools to move in this direction.

Though the private sector is loath to think about the prospect of job quotas, it may be a matter of time before the government turns its attention to this policy in some form or other.

Certainly, the electoral compulsions for doing so are high, though the prospect of alienating big business donors is a risk.

Rather than a blind reproduction of the government template, a more productive way of enforcing affirmative action in the private sector could be to emulate an American model.

Under this, private companies awarded government contracts were required to have proven affirmative action policies in place.

Given the huge number of infrastructure contracts at the Government of India’s command right now such a policy could bridge the gap between the demands for affirmative action and the imperative for commercial profit.

Together with progressive civil rights legislation in the US, this policy has seen the emergence of an African-American middle class whereas India can scarcely make the same boast despite almost seven decades of affirmative action.

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