Sales Promotion Employees Act: Mr. Sharad Patil's Interview

The Sales Promotion Employees Act was extended to some industries recently. The Employers’ Federation of India has repeatedly made representations to the Government against such a move. We are publishing, with the consent of EFI, their representation.

We are also publishing an interview of Mr Sharad Patil, Secretary-General of EFI which is very informative. Mr. Sharad Patil needs no introduction, he is an accomplished HR professional and a person regarded very highly for his professional and personal integrity. We gratefully acknowledge the consent granted to publish both, EFI letter and his interview.

Q 1.     The Sales Promotion Employees Act (SPE) has been made applicable to the following ten industries by the Government of India.  What is your reaction to this decision?

A -       EFI reaction to this decision is contained in the copy of our representation referred to above.

Q.2.     What was the experience of the impact of the SPE Act on the Pharmaceuticals Industry?

A -       Pharmaceutical industry experience is bad, to say the least.  A few mandates effectively implemented by the Federation of Medical & Sales Representatives Association (FMSRA) include enforcing working hours, field meeting / conference timings as in office or factory and not as per requirement of business.  Area Managers normally having to seek union’s written permission 7 days in advance for working with a medical representative marginalizing organizational functioning and adversely impacting business. Attracting and retaining high potential employees gets more difficult, as there are other better options.  Today’s youth seeks greater freedom to decide for themselves.  There may be some justifications for unions to espouse causes of sales people but strangulating business also creates a possible stereotype amongst emplolyees and impacts freedom to function.         
            Pharmaceutical industry has made several high level representations to the Government but so far to no avail. EFI has not only just stood by the Pharma Industry but continues to exeret its influence in contributing to possibly improve the current scenario.  It perhaps is early to say how this will be possible.  I am an eternal optimist and strongly believe in the goodness of human beings.

Q.3.     Why are the employers opposing extension of coverage under the SPE Act?
A -       Employers in notified industries have not yet experienced the implications and are blissfully silent on the issue. I hope these industries proactively deal with the situation.  EFI will be happy to help

Q.4.     Please tell us the efforts made by EFI to represent the employers’ case in this matter.

            EFI has represented this matter at various tripartite fora but find that the Governments both Central and the States have more sympathies with Sales Promotion Employees.  Their Associations have worked hard at it and taken advantage of lack of appreciation of issues by the beaurocracy across the country.  

Q.5.     What are the challenges before the Industry and to what extent the Government is addressing them effectively?

A  -      Nature of work performed by Sales Promotion employees particularly in the field is very different than that of in a factory or office. The law makers and the enforcers have inadequate understanding and appreciation of nature of work done by the field sales people. Other than Pharmaceutical Industry, other industries and their associations have more or less remained silent about this impending legislative change. 
-         Dealing with multifarious unions of multi-location employees and Government  officials across the country. 
-        Government plans to deal with them with their existing machinery.   
            The challenges are   

(a)  “Appropriate Government” being State Government in case of disputes having to deal with State Government across the country
(b)  Lawless behavior of sales promotion employees union makes functioning difficult for businesses particularly in case of field sales – not as much work in a office or a show room.  Government support is lacking in cases of law and order situations. 
(c)  Sourcing good employees : Bright, young educated people shun the sales promotion employees job as they do not wish to be part of unionized workforce.  They prefer to work with freedom in a non-unionized work place.
(d)  Lowering productivity of sales promotion employees will hurt SME’s more than others.

The Employers Federation of India

March 22, 2011

Shri  Prabhat Chandra Chaturvedi, IAS,
Secretary to Government of India
Ministry of Labour & Employment
Government of India
Shram Shakti Bhavan, Rafi Marg,
New Delhi – 110 001

Dear Shri Prabhat Chaturvediji,

Sales Promotion Employees Act - Extension to 10 other Industries
Ministry of Labour & Employment, Notification, New Delhi,
31 January 2011

We have following submissions to make with regard to the above Notification.

1.    Regrettably the Notification is not in keeping with the spirit of tripartism.  Minutes of the meeting held on 12 November 2010 mention of “Broad consensus reached at the meeting”, when in fact there was no consensus.  Demands of the trade unions were conceded despite total strong and unequivocal opposition by employers representatives based on facts. 

2.    EFI and other employers’ representatives even requested as a last resort, to discuss the matter with concerned industries and other representatives before extending coverage of SPE Act which has been denied, without even giving reasons for the same.

3.    From time to time, the Pharmaceutical Industry and on their behalf the Employers’ Federation of India have brought to the notice of the Ministry of Labour and Employment atrocities and unlawful activities perpetrated by the FMSRAI on Pharmaceutical industry.  We earnestly request your goodself to listen to the problems of the Pharmaceutical Industry and find solution preventing FMSRAI and their associates from indulging in atrocities and unlawful activities which are not in the best interests of the industry and its employees. 

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4.    Ministry of Labour and Employment in issuing this Notification has also not taken into account request by the Ministry of MSME for “keeping MSME Sector out of the purview of the Sales Promotion Employees (Conditions of Service) Act 1976.

5.    The Notification also does not take into account AYUSH’s request that “the Department instead like to consult the Associations which are around 14 in number on matters concerning the Sales Promotion Employees”.

6.    We refer to our submissions contained in our letter of 29 December 2010 on the above subject state that the Employers’ representatives were/are totally opposed to extension of the Sales Promotion Employees Act to 10 other industries for the reasons enumerated at the meeting as well as in our letter dated 29 December 2010.

We have two requests to make :-

(i)            Consider rescinding the Notification and implement only after taking into account views of the concerned industries, and

(ii)          Initiate appropriate actions on unions engaging in atrocities and unlawful activities which is not in overall interests of employers and employees.

We would be willing to provide information requested in this behalf.

Thanking you,

SHARAD S.PATIL                                                                                                        Secretary General

c.c. Mr. Ravi Mathur
       Additional Secretary – Government of India
       Ministry of Labour & Employment, New Delhi

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