Karnataka plans to bring a law to raise the retirement age of employees to 60, which companies say would hurt the state more as millions of unemployed people would lose out on newer opportunities.
The state cabinet has approved the plan to raise the retirement age from 58 to 60 and expects the regulation to come into effect in May.
"The new rule will mainly affect factories. It is difficult health-wise for the workers to work beyond 58. It also leads to less productivity. The move would have been good had there been a serious shortage of workforce, however, we have a lot of unemployment hands currently," says B C Prabhakar, president of Karnataka Employer's Association.
The association has already written to the state labour minister expressing concerns over the extension of the retirement age. It says this could lead to delay in promotions for juniors, besides postponing opportunities for the unemployed.
"Unlike 20 to 30 years back, there is a very strong social security for employees nowadays. There is Provident fund, and gratuity. So when people retire they are taken care of. To improve the life of a worker, the minimum wages should be increased and not the retirement age," added Prabhakar.
He also pointed out that Andhra Pradesh has reduced the retirement age from 60 years to 58 years and even Tamil Nadu and Telangana have stuck to 58 years. "At such a time, Karnataka taking such a decision is not correct. It actually is curbing the chances of many," added Prabhakar.