1. INTRODUCTION
On January 15, 2022, the government of Haryana had formally notified the Haryana State Employment of Local Candidates Act, 2020 (the "Act") and the Haryana State Employment of Local Candidates Rules, 2021 (the "Rules"), which enforced a 75% reservation requirement in employment for local candidates (i.e., candidates domiciled in the State of Haryana) earning INR 30,000 or less.
While a number of employers in Haryana have completed the registration process under the Act, the enactment of the Act itself has been the subject of significant controversy and opposition from local industrial associations and trade unions. To that end, several industrial associations and other related entities had filed petitions challenging the constitutional validity of the Act before the Punjab and Haryana High Court ("High Court"). The claims made in these petitions include the argument that the Act is in violation of a private employer's constitutional right to trade and an employee's right to seek employment anywhere in India. The key provisions of the Act have already been discussed in our previous updates which can be accessed at https://bit.ly/3nq7Uog and https://bit.ly/3goD9Mp.
2. HIGHLIGHTS
The matter was heard by the High Court on February 2, 2022, wherein an interim stay on the applicability of the Act was ordered by the High Court. While issuing the order, the High Court also observed that the State does not have the right to call for reservation in private sector jobs on grounds of an employee's domicile. The Haryana government has also filed an appeal against the order of the High Court before the Supreme Court of India. The appeal is currently pending before the Supreme Court.
3. INDUSLAW VIEW
The order of the High Court seems to be in line with common sentiment. It would be interesting to observe the next steps taken by each of the parties as the appeal filed by the Haryana government is now pending before the Supreme Court.
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