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Malls, restaurants can open 24x7 in Karnataka, but at what cost?

TNM spoke to owners of restaurants, malls, commercial establishments to explore whether the new rules are viable for businesses, but more importantly labour rights.


The Karnataka government on Saturday issued an order allowing shops and commercial establishments including malls and restaurants to be open 24x7, stating the move was to ensure ease of doing business and revive the state’s economy. While restaurant owners welcomed the move, owners of independent commercial establishments say that it would not be economically viable for them to open their stores round-the-clock. In addition, labour unions expressed concerns of safety of women employees, but especially whether worker rights would be prioritised considering the existing system of checks and balances. 
Speaking to TNM, PC Rao, President of Bruhat Bengaluru Restaurant Owners’ Association, said that the government’s decision would help restaurateurs in reviving their businesses after the losses suffered due to the pandemic. He said that restaurant owners have decided to pilot opening the establishments on Fridays, Saturdays and Sundays initially in commercial areas to test the consumer behaviour. 
“Restaurant owners have decided to open certain outlets in areas like MG Road, Church Street, Malleshwaram, Jayanagar etc, where people generally go out to eat a lot. Opening on Friday, Saturday and Sunday can allow us to determine what the footfalls are like and whether the consumers are welcoming the new model. If this works, we can recover 20% of the loss in business in the first year itself,” PC Rao said. 
Mall owners welcome government decision
Shashi Kumar, Chief Operating Officer of Brigade Group’s Retail businesses, said they welcome the government’s decision but also expressed concerns around implementation. “It is a welcome move because in the long run it will generate more revenue and employment post the dire COVID-19 situation. Although we have to consider how this will be accepted by consumers because consumer patterns show that people do not shop beyond the late evening unless there are special occasions or festivals. Apart from which there is a whole lot of resources that will be required to keep the mall operational 24/7. Having said that it is definitely doable with better planning by all stakeholders and the authorities,” he said. 
Independent shops and commercial establishments express concerns
Vendors at shops along Church Street and Brigade Road in Bengaluru said that the move would not help such independent establishments as they would have to hire more people in shifts to keep the shops open 24x7. Retailers said that over the last four years, the business has steadily declined due to the boom in e-commerce and the increased taxes due to GST. 
“Business has already been low and just picking up slowly right now. A lot of traders in Bangalore have two or three employees. We have to adopt a shift system, pay salaries, overtime and also there would be added costs like maintenance costs to keep the store open. So it would be an added investment, which is not viable for us now,” said Irfan Noor, Secretary of Church Street Occupants Association. 
Sohail Yusuf, Secretary of the Brigade’s Shops and Establishments Association, who owns the Sony Centre store on Brigade Road, said that most of the retail outlet owners along Brigade Road, would not be willing to open 24x7 as the losses have increased, especially after the pandemic, the shop owners lack funds to expand businesses. “We have so many other issues that could have been addressed instead of the new move. The Taxing policy is not good at all. GST is affecting us in a very bad manner. We pay 28% tax on electronics. What is the benefit for us with the new policy? Business has been on decline for the last 4-5 years. Initially it was demonetisation, later the GST. Now the government has increased property tax by 15%. With so many things on our plate, we won’t have the ability to keep shops open round the clock. We are now going through a rough time, does the government want to throw stones at the current situation?  It would not be a wise investment and we won't even recover 25% of the costs,” he said. 
Will employee rights be compromised?
According to the government order issued on January 2, shops and commercial establishments employing 10 or more people can continue to operate 24x7 in a shift system. All employees can work a maximum of eight hours per day with over time work hours not exceeding more than two hours per day. Women employees will be allowed to work night shifts provided they submit a letter of consent. The establishments must also ensure that women employees on night shift must be provided with facilities to commute to and from the workplace. These rules were also in place for larger establishments like factories. 
The violence that erupted at Wistron’s iPhone manufacturer in Kolar, was primarily due to the lack of payment of wages and overtime money to workers. Hundreds of Wistron’s workers had vandalised the factory after months of simmering anger. While the Karnataka government vowed to settle the differences between the workers and companies in Wistron’s case, one of the primary concerns for workers regarding the new order, is whether the government would be able to monitor the violations in labour laws if establishments are allowed to open 24x7. 
Maitreyi Krishnan, a lawyer practising in the Karnataka High Court and specialising in cases related to labour rights, said that the new government order does not take into consideration the real world situations where workers, especially contract employees are exploited. Maitreyi, who also represents several labour unions as their legal counsel, said, “One thing is that the new code of wages and labour rules have entirely removed the system of random inspections by the government on commercial establishments and have turned them into facilitators. “Now, inspections will not happen but the government only wants regular reports from the businesses. If there are no checks, how can anyone know whether workers are being treated fairly?” 


Another problem that could arise, she said, was that the minimum wages would be very low. Since the new rules state that minimum wages for floor employees per day is Rs 178, it does not take into consideration the basic needs like food, clothing and housing. “The new rules say that minimum wages are calculated based on a certain percentage of expenses for food and clothing. The housing aspect has been removed and this is in violation of the Supreme Court order, which had issued directions on calculation of minimum wages. With the new rule, we won’t know whether  workers are being paid basic salaries, let alone overtime,” she said. 
The Karnataka government, in 2020, brought in amendments to the Industrial Disputes and Certain Other Laws (Karnataka Amendment) Act. Under this legislation, the government expanded the concept of “illegal strikes”, where workers of any companies, not just public service utilities, had to give prior notice to the companies before calling for a strike. “If you go on a strike, without notice then the union registration would be cancelled. Employees who speak against companies can be charged with inciting internal differences and can be fined upto Rs 50,000 with three years imprisonment. If any employee contributes even a small amount of money for a strike, then they can be penalised. What the government has done is completely remove the rights of workers to unionise and strike,” Maitreyi added, while stating that the labour unions were not consulted before such a decision was taken. 
said that the government’s order is very vague in terms of defining the rights of women workers. “When amendments were brought in for Factories Act, there were clear definitions on what facilities women employees should have. Here it only says written consent is required. In most cases, if women do not agree to night shift, they get fired. Most establishments will hesitate to hire women with this kind of rule,” she said. 



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