Threshold of Mandatory Apprenticeship Programme decreased for SMEs
|Reform Description||Requirement of Mandatory Apprenticeship Programme for SMEs brought down to 10% of Total Workforce
Before: It was mandatory for all businesses to employ 20% of the workforce as apprentices which meant extra cost to businesses for unskilled employees.
After: Now, for the SMEs, mandatory apprenticeship threshold has been reduced to 10% of the workforce.
|Department||Labour & Human Resource Department , Punjab|
|Date of Implementation|
|Details||Difficulty||● The Factories Act, 1934 required that every business had to employ and train apprentices; and the threshold was set to be 20% of total employment.
● This was a challenge for SMEs because of their limited resources. SMEs had to bear expenses of un-skilled apprentices who had little to contribute to the efficiency or productivity of business.
|Analysis||● The requirement for apprenticeship at a rate of 20% of total employees was an unnecessary burden for SMEs which required reconsideration.|
|Solution||● To facilitate SMEs, the threshold of apprenticeship programmes under the law has now been reduced from 20% to 10%.
● This will reduce the financial burden of SMEs and provide them space to hire skilled employees.
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