Labor laws, for example, still make it almost impossible to lay off a worker –as the infamous case of Uttam Nakate illustrates. In early 1984, Nakate was found at 11:40 sleeping soundly on the floor of the factory in Pune where he worked. His employer let him off with a warning. But he was caught napping again and again. On the fourth occasion, the factory began disciplinary proceedings against him, and after five months of hearings, he was found guilty and sacked. But Nakate went to a labor court and pleaded that he was a victim of an unfair trade practice. The court agreed and forced the factory to take him back and pay him 50 percent of his lost wages. Only 17 years later, after appeals to the Bombay High Court and the national Supreme Court, did the factory finally win the right to fire an employee who had repeatedly been caught sleeping on the job.
That is Gurcharan Das, former CEO of Procter & Gamble India, writing about ‘The India Model’ in the July-August issue of Foreign Affairs. (The entire issue is India-focused, and should be online soon.) Our Doing Business project ranked India 116 out of 155 in the world in terms of hiring and firing worker regulations.
Update: the article is now online.
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