The exuberance created by the inclusion of the provision on “no work, no pay” in the brand new Industrial Enterprises Bill may be short-lived, as the measure may not make any difference to employers unless the new labour law, which is being reviewed by the Parliament, grants the facility.

The Parliament on Thursday ratified the Industrial Enterprises Bill incorporating a provision that enables employers to deny payment to workers during the period when they do not work.

Although President Bidhya Devi Bhandari is yet to sign the bill into law, the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), the largest private sector umbrella body, has welcomed the Parliament’s passage of the bill.

However, there are doubts on whether the legal provision, aimed at reducing the number of unlawful protests in various industries, can be effectively implemented. “The provision on no work, no pay will not have legal teeth if the new labour law fails to embrace it. This is because the Labour Act, which deals with all kinds of work-related issues, will supersede the Industrial Enterprises Act,” Shekhar Golchha, vice president of the FNCCI, told the Post. “We are still seeking clarity.”

The private sector has long been demanding for legal provisions on “no work, no pay”, and “hire and fire”, after employees started halting production in the name of protests and then demanding wages for the period when they did not work. Also, difficulties in slashing the workforce even when businesses were facing deep financial problems had created hurdles for employers.

The new Labour Bill, which is currently being reviewed by lawmakers, has tried to address these issues.  The Bill—which once signed into law—will replace the 24-year-old Labour Act-says employees engaged in unlawful protests will not get paid during the period when they remain absent from workplace.

Employees engaged in lawful protests, on the other hand, will get 50 percent of the salary, says the Bill, which has defined lawful protest as demonstrations that were carried out by notifying the management and the government.

The Bill has also paved the way for employers to lock up production units if employees engage in protests without providing prior information to the management. The government can, however, take action if such lock ups are arbitrary and carried out using false pretence.

Also, the Bill has included a provision that allows employers to cut workforce if they face financial problems, or problems of overstaffing due to mergers.

Companies that have to completely or partially shut down their businesses due to various reasons can also cut workforce, says the Bill, which bars employees from staging protest in properties other than where they are employed.

“Legal provisions aimed at creating business-friendly environment allow industries to grow, which will ultimately help in job creation process,” said Hari Bhakta Sharma, president of the Confederation of Nepalese Industries. “We welcome such initiatives.”

He, however, said labour relations were improving in Nepal of late, as “trade unions were getting matured”.