Recently on 2nd March 2021, Governor of Haryana, Satyadeo Narain Arya, gave his assent to the Haryana State Employment of Local Candidates Bill, 2020 entailing 75% reservation to the local candidates of Haryana in Private sector Jobs in the State. At present, there is the coalition government of Bhartiya Janta Party and Jannyak Janta Party in Haryana. Providing reservations to the youth of the Haryana was in the manifesto of Mr. Chautala’s Jannayak Janta Party and consequently, the bill was passed in the state assembly of Haryana in November 2020. Now the Governor has also signified his assent to the bill amid large scale protests by the Farmers of Haryana against the Farmers Bills passed by the Central Government, and it has become a valid law.

This article is written by Ms. Manali Agrawal, student of BA.LLB. (Hons.), of Jagran Lakecity University, Bhopal.  

Earlier, the Andhra Pradesh government came up with similar legislation, the Andhra Pradesh Employment of Local Candidates in Industries/Factories Bill 2019, which also provided for 75% reservation to local candidates in private industries. Thus, Haryana became the second state in India to pass such legislation.


Following are the salient features of the newly passed bill by the Haryana Government:

  1. The bill covers all the private companies, societies, trusts, Limited Liability Partnership firms and even the private persons based in Haryana and employing 10 or more than 10 employees.
  2. The persons who are the domicile of Haryana can avail the benefits of this legislation.
  3. The will not affect the employment of already employed employees from outside Haryana in the private sector jobs.
  4. However, the bill restricts the reservation to the jobs with salary slab of maximum of Rs. 50,000/-per month i.e. it is not applicable if the salary for a particular job is more than Rs. 50,000/-.
  5. The Bill shall remain in force only for 10 Years after its commencement.
  6. It grants discretion to the employers to restrict reservation to the local candidates of a particular district to 10% of total number of local candidates.
  7. The employers can get exemption from this obligation, by following the procedure laid in the Act, only if the local candidates with desired skills, qualification or maneuver are not available in adequate number.
  8. Employers will be requires to present the report regarding employees appointments on quarterly basis for scrutiny by the government.
  9. If the provisos of this act are not complied with, the employers shall be liable for fine of minimum Rs. 10,000/- but not exceeding to Rs. 2,00,000/-. Further, penalty is to be imposed if employer presents the tainted documents to the government.


The bill has been passed by the Haryana Assembly with the objective of tackling the issue of unemployment at local level. However, the main objective of the legislation is to prevent internal migration for jobs. The state government has said, “Apart from tackling unemployment among local people, the law will discourage the influx of migrants seeking low paid jobs, which has a “significant impact” on local infrastructure and leads to the “proliferation of slums””.  It has also called it socially, economically and environmentally desirable. Also, the Act will help to facilitate local level knowledge economy and will generate local employment in the state.

However, many scholars have not appraised this act of the Government on the grounds that it will hamper the competitiveness in the market. Concern must be shown to the fact that many a times, higher efficiency or a specific skill is required to a particular job and local candidates may not match that level. This will affect the performance of the Industry. Constitutional validity of the Act is also in question. Further, Social friction can also be caused due to this act. And if other states also follow such step, it will create chaos in the Country. 


Although, the bill has become valid legislation after obtaining the assent of the president, the Constitutional validity of the Act must be examined. The Constitutional validity of the act may be examined on the following grounds:

  1. It is violative of Fundamental Right guaranteed under Article 19(1)(g) of the Constitution.
  2. It is violative of Fundamental Right to Equality.
  3. It is against various Constitutional norms set by the Supreme Court.

It is violative of Fundamental Right guaranteed under Article 19(1)(g) of the Constitution:

Article 19(1)(g) of the Constitution guarantee the Right to practice any profession, or carry on any occupation, trade, or business. Further, the said legislation does not fall within the ambit of the reasonable restriction given under section 19(6) as reserving 75% of the seats for the people belonging to a state cannot be called an act in the interest of the general public. It is sheer misuse of power by the government to increase their vote bank in the state.

The Supreme Court in plethora of cases, like PA Imandar [1] and TMA Pai Foundation,[2] dealing with Reservation in Private educational Institutions has held that imposing reservations on the institutions which do not receive any state aid is an encroachment upon their Fundamental Right to carry on their trade, business, and occupation. It is thus violative of Article 19(1)(g) of the Constitution.

It is violative of Fundamental Right to Equality:

Article 14-16 of the Act provides for equality within the territory of India and prohibits discrimination only on the grounds of religion, race caste, sex, and place of birth or any of them. However, the said act discriminates solely on the basis of domicile which is not a reasonable ground for classification to grant reservations. The same has been iterated by the Courts in a number of cases like Kailash Chand Sharma, [3] Pradeep Jain [4] and Sunanda Reddy [5] where the Court held that domicile alone cannot be a ground for reservation and declared it to be constitutionally impermissible.

However, the government countered this argument by stating that the aforesaid provisions of the Constitutions are applicable only in the matters of public employment and the present Act is with regards to reservation in the Private sector.

In 2018, the Karnataka government’s proposal to grant 100% in blue-collared jobs in the private sector was challenged before the Court. Here, it was contended that a law binding to employ local candidates cannot be enforced. In July 2019, Andhra Pradesh government’s legislation providing reservations on similar grounds was challenged before the High Court of Andhra Pradesh. The Court here said that the act may be Unconstitutional however the decision is still pending in the Court.

It is against various Constitutional norms set by the Supreme Court:

In the landmark judgment of Indira Sawhney, [6] the Supreme Court set the 50% ceiling limit and held that the total Reservation cannot exceed 50%, except in exceptional circumstances. Since there were no exceptional circumstances that compelled the Haryana government to pass legislation providing for 75% reservation to local candidates in private employment, the act violates the constitutional norm set by the apex court of India.

The Court has declared various legislations like Telangana (Backward Classes Scheduled Castes and Scheduled Tribes Act 2017), Rajasthan (Backward Classes Amendment Bill, 2019), and Maharashtra (Socially and Educationally Backward Classes (SEBC) Act, 2018) as unconstitutional on the ground that these breached the 50% ceiling limit on the reservation.


The bill passed by the Haryana state Assembly for providing 75% reservation to local people in private jobs in Haryana has received governor’s assent and has become a valid law. It provides procedure to be followed for executing the Act and also restricts its applicability to the job having a salary above Rs. 5000 per month. The bill has served many positive purposes however it is also being criticized on certain grounds. The Constitutional validity of the Act must also be examined as reservation on the ground of Domicile defies the Fundamental Rights of its citizens and also shatters the pillars of unity and equality of India.

[1] PA Inamdar v. State of Maharashtra, AIR 2005 SC 3226

[2] T.M.A. Pai Foundation vs. State of Karnataka, AIR 2003 SC 355

[3] Kailash Chand Sharma vs State of Rajasthan, AIR2002 SC 2877

[4] Pradeep Jain v. Union of India, (1984) 3 SCC 654

[5]  Sunanda Reddy v. State of Andhra Pradesh, 1995, AIR 914 1995 SCC Supl.

[6] Indra Sawhney and Ors. vs Union of India and Ors., AIR 1993 SC 477

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