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Amarchand Mangaldas

About Amarchand Mangaldas

Amarchand Mangaldas is a legal services company based out of New Delhi, India.

Headquarters Location

Amarchand Towers 216 Okhla Industrial Estate, Phase III

New Delhi, 110 020,

India

91 11 2692 0500

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Latest Amarchand Mangaldas News

India: Unlocking Potential And Nurturing Talent: Apprentice Involvement In The Service Industry - Shardul Amarchand Mangaldas & Co

Jan 17, 2024

To print this article, all you need is to be registered or login on Mondaq.com. As one of the rapidly developing nations, India recognised thepotential of a growing workforce as an opportunity to boostproductivity. To meet these objectives, the Apprentices Act, 1961(Act) enacted almost 63 years ago has gained steam. The Act was primarily aimed at imparting training to unskilledworkforce with a view of meeting the requirements of skilledmanpower for the industry. The early years of the Act was marked byan emphasis on the manufacturing industry. However, with theadvancement of technology and economic expansion, the servicesector paved the way for new opportunities for skilled forcedevelopment. Apprenticeship programs which were primarily focusedon the manufacturing industry became antiquated when the servicesector emerged as the largest employer in the country. The Act didnot enable the service industry to engage apprentices unless therewere notified designated trades within the establishments. The provisions of the Act prevalent at the time were notconducive for the service industry to comply with the Act. Thisnecessitated certain changes to the framework governingapprenticeship. Services industries such as accounting,book-keeping and auditing activities, data processing, softwaredevelopment and computer consultancy services; engineering andother technical consultancy activities were specifically notifiedand brought under the purview of the Act. An all-encompassing entryof 'activities not adequately defined' was also introducedin the list of notified industries. Further the number ofdesignated trades evolved to create corresponding trades for IT/ITES and other notified service sectors. Subsequent to the inclusion of other industries within the ambitof the Act, a significant amendment to the Act was introduced in2014. The amendment placed additional importance on promotingapprenticeships in trades related to services sectors, alongsidethe existing trades oriented towards manufacturing. Introduction of'optional trades' enabled industries to tailor coursesaccording to their sector-specific needs and expectations. Thepenal provisions in respect of imprisonment were removed andreplaced with monetary penalty. The amended provisions as theystand today allow flexibility to employers on the manner ofengagement of apprentices and compliance with the legal obligationsunder the Act. In addition to the above progressive reforms, the NationalApprenticeship Promotion Scheme (NAPS) and National ApprenticeshipTraining Scheme (NATS) have been introduced under theapprenticeship framework as an enabling step for ease of complianceand encouraging number of organizations to comply with the Act.These schemes offer financial incentives to businesses and sectorsfor hiring apprentices. The other advantages of the schemes arethat it facilitates registration on the apprenticeship portal,selection of suitable apprentices and designing the curriculum. Theschemes also permit the employer to engage third-party aggregators(TPAs) for (a) selection and engagement of apprentices on theapprenticeship portal; (b) developing a course curriculum for theapprentices; and (c) filing of all necessary returns and documentsunder the Act. On-the-job training obligation under the Act canalso be outsourced to a third-party service provider or TPA in casethe employer does not have adequate expertise or infrastructure toprovide the training. Furthermore, the National Skill Development Corporation hasestablished a body namely the Sector Skill Councils (SSCs) toprovide guidance on matters relating to (a) identification of skilldevelopment needs; (b) sector skill development plan; (c)determination of skills/competency standards and qualifications;and (d) setting up of affiliation, accreditation, examination andcertification norms. Thus the approach of the apprenticeship authorities has evolvedfrom strict compliance with the Act to engagement of apprenticesfor the purposes of the skill building. This was followed by aflurry of notices received by companies to commence engagement ofapprentices. Due to the steps taken by the authorities on implementation ofthe Act, businesses have become conscious of the requirement ofengaging apprentices. This has necessitated devising innovativeapproaches towards apprentices' engagement and management.Apprenticeship can play a vital role in the task of up-skillingIndia's workforce involving governments, employers andworkforce in partnerships. The government's endeavour is tobridge the skill gaps, create a steady talent supply chain and lockin talent for the future. A company looking to initiate compliance with the Act would needto undertake the following: Registration: Registration of the establishment on theapprenticeship portal is required to be obtained upon the Actbecoming applicable to an establishment. The relevant registrationportal, i.e. NAPS or NATS would depend on the category ofapprentices and the trade in which the apprentices would beengaged. For graduate apprentices and designated trades, NATS wouldbe the applicable portal and for undergraduate student apprenticesand optional trades, the establishment would need to register onNAPS. It is the prerogative of the employer to register either withNATS, NAPS or both. For establishments with offices in 4 or morestates, central registration can be obtained. Engagement of apprentices: Establishments with 30 ormore workers required to engage apprentices in a band of 2.5% to15% of the total strength of the establishment includingcontractual staff, within a financial year either in'designated trades' or 'optional trades'.Apprentices can be selected from the apprenticeship portal orinstitutions enrolled on the apprenticeship portal. Course Curriculum: There are certain pre-approvedcurriculums available on the website of the Directorate of GeneralTraining for both optional and designated trades, which anestablishment is free to use. However, if an establishment isdesirous of formulating its own training module, it can, using theguidelines prescribed for formulating courses/curriculum under NAPSand NATS for designated trade and for optional trade courses. TPAscan assist establishments in developing a course curriculum for theapprentices. Training: The training has to be conducted in accordancewith the designated/optional trade course curriculum forapprenticeship training implemented by the employer. The employeris required to ensure that adequate infrastructure and qualifiedtrainers are available to impart the apprenticeship training inaccordance with course curriculum adopted by the employer.On-the-job training can be provided remotely and can be outsourcedto a TPA or external service provider having the requisiteexpertise and qualifications. The developments in the apprenticeship regulatory regime aim ataccommodating the service sector so that all sectors cancollectively contribute to build a skilled workforce as part of the'Skill India' initiative. According to reports, there hasbeen a consistent rise in the involvement of apprentices in theIT/ITES industry. There is a stark transition from a regulatory framework ofstringent compliances under the Act to one of self-regulation bythe industry. Now, industries have the power to not only decide thenumber of apprentices required (subject to minimum thresholdrequirements) but also determine the duration, curriculum,assessment, and certification processes. While there is still aconsiderable journey ahead, industries have started to be morereceptive to the concept of involving apprentices in theirbusinesses. The content of this article is intended to provide a generalguide to the subject matter. Specialist advice should be soughtabout your specific circumstances. AUTHOR(S)

Amarchand Mangaldas Frequently Asked Questions (FAQ)

  • Where is Amarchand Mangaldas's headquarters?

    Amarchand Mangaldas's headquarters is located at Amarchand Towers, New Delhi.

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