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India – Staffing industry needs regulations, says Randstad

21 February 2013

The CEO and managing director of Randstad India, E Balaji, has called for better regulation of the local staffing market. In a letter published in Business Line, he said that “stumbling blocks” prevent businesses from growing.

Referring to the government’s annual budget announcement due next week, Mr Balaji said: “2012 has been a year of muted growth for businesses. So, the business community is keenly looking at Budget 2013 and is expecting a shot in the arm to boost growth rate and thereby impact job creation.”.

He called on the government to promptly address obstacles that block business growth.

“Talent crunch continues to be a big issue industries are facing and the gap seems to widen every year. The 2013 Budget needs to have initiatives that will promote skill development, research and higher education,” he said.

“This can happen through entry of foreign universities or setting up national boards to focus on the same. India does not have any flexi staffing industry specific laws. Absence of it is leading to ambiguous interpretation of current labour laws which are applicable to all. Also, in the present condition, roles of primary employer, staffing agency and benefits to temporary workforce are not clear.”

The CEO also said that greater clarity was needed on taxes applicable for services provided by staffing companies, which he said needed greater attention. “Considering the business model of staffing companies, Service tax is to be levied on service charges and not total cost of service,” he said.

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