Constitutionality of Domicile Reservation in private sector employment


According to the Constitution of Indian, when it turned itself into one nation from a geographical point of view, every individual as a whole participated in the idea of universality. They formed as citizens of India. As India has single citizenship, it gives every citizen liberty to move freely from one state to another in any part of the country. A birth certificate or residence place requirement cannot be counted as a qualification for granting employment in any state.

Haryana State Government gives assent to Local Candidates Bill, 2020

The Governor of Haryana grants his assent to the Haryana State Employment of Local Candidates Bill, 2020, on 26th February 2021. The Bill reserves almost 75% seats to the locals for private-sector jobs; it was published in the official gazette for general information on 2nd March 2021 and came into effect as may be notified by the State Government of Haryana. Thus, the Bill reserves 75% of seats to the domicile, and the rest, 25%, are given to outsiders, but according to the Indian Constitution, the violation of Article 14, 15, 16, 19 and 21 came into existence. The important provisions of the Bill are:

1. Bill's operation duration shall cease to affect ten years from the date of its commencement.

2. The Local Candidates Bill, 2020 applies to all private sector companies, societies, trusts, limited liability partnership, partnership firms, and persons employing 10 or more persons, including employers. The public sector organisations would be excluded from this Bill.

3. The employer must register on the government’s portal. Therefore, employees who earn gross “salary or wages” up to Rs. 50000 p.m. They are also required to register on the government portal. The registration process is limited to 3 months from the commencement of the statute.

4. The recruitment criteria for local candidate covered by the employers. They require reserving 75% of the local candidates’ seats, but it shall not be less monthly than Rs—50000 for a person domiciled in Haryana.

5. The Employers should furnish quarterly reports regarding local candidates recruited by them in the State Government’s manner.

6. Non-Compliance with employee registration requirement may lead to a fine within the range of Rs. 25,000 to Rs. 1, 00,000. If recruitment should not be filled within 75% of the post for local candidates, fines shall be imposed in Rs. 50,000 to Rs. 2, 00,000.

Domicile Reservation shall not impose on State Government

The issues are raised based on legality by the law and legislative secretary during the proposed law’s vetting. The private sector preference for local candidates violates Article 14 of the Constitution pertaining to equality before law and Article 19 (1)(g) that protects certain rights to practice any profession, business, trade, or carry on any occupation. According to the Constitution of India, it violates the fundamental right of every individual of India. The Bill does not limit the reservation in terms of job and applies across all kinds of jobs irrespective of education, skill, qualification and experience.

The viewpoint of private-sector jobs

In recent times privatisation plays an important role in India; such laws will be difficult to implement even if such laws are amended. The private sector employees do not go on an annual recruitment drive to fill up the vacancies or identify vacancies in advance; private-sector jobs are hired immediately and required. The State laws can be amended or given preference to locals but ensuring that hiring employees would be equal. In 2017, Karnataka passed legislation, but it was dropped after the state’s Advocate General raised a question on the state's legality. The state government in 2019 issued a notification asking for a private employer to prefer Kannadigas for blue-collar jobs.

Locals gave preference to reserve jobs

According to Article 16(3), Parliament enacts laws for public employees aiming to abolish all existing residence requirements in the states. Certain exceptions are made in the case of a special instance of Andhra Manipur, Tripura Himachal Pradesh. Thus, under Article 371, some states have a special reference for India and Article 371(d) in Andhra Pradesh can have direct recruitment for local cadre in specified areas. Similarly, in Uttara hand, class III & IV jobs are reserved for locals.

According to Article 16(2), some states have a mandatory clause for their regional language that prescribes language as criteria. It ensures that local citizens are given preference for being the domicile of that state.

According to Article 16 of the Indian Constitution

1. Every individual should be equally treated under law in matters of public employment, and it prohibits the state from discriminating on the grounds of place of residence or birth.

2. No citizen of Indian shall be discriminated against based on any religion, caste, sex, descent, place of birth, residence or any of them, or discriminated against in respect of any employment or office under the state. Thus, equality under the law should be given relevance.

3. It provides an exception by stating that Parliament would prescribe a law stating a requirement of residence for jobs in a particular state. Thus, power vests solely in the Parliament, not state legislatures.


1. Constitutionality of Domicile Reservation in private sector employment shall be not imposed because it violates every citizen’s fundamental rights.

2. The Central or State Government shall not compel an employer to terminate its existing non-local workforce’s services to meet the 75% reservation requirement.

3. In the private sector, the organisation government shall give Non-Local Candidates relief for the domicile reservations.

4. Also, the ongoing COVID-19 pandemic has adversely impacted several companies in terms of their financial position. The Bill is an asset to increase businesses' cost on several training programmes of local candidates and the displacement of the present non-local workforce.

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