The concept of reservation was introduced by the makers of the constitution with the sole purpose of uplifting the weaker sections and backward classes of India. At the time of the adoption of the Constitution, the caste system was very rigid, which impeded the holistic development of the nation. Owing to this rigidness, people in the lowest level of the caste system were economically weak, socially, culturally, and educationally backwards. To mitigate this problem, positive discrimination was allowed under Art. 15 as an exception to the Right to Equality enshrined under Art. 14 of the Constitution. However, certain states are extending this concept beyond the boundaries of the Constitution by providing domicile-based reservations in their respective states. Lately, states like Haryana, Madhya Pradesh, and Jharkhand have enacted laws to grant reservations to the natives in jobs concerning their respective states. These laws deviate from the objective of the reservation policy and fail to achieve the nexus with the Constitution.
CONSTITUTIONALITY OF RESERVATION SOLELY BASED ON DOMICILE
Art. 16(1) states that no discrimination should be done based on religion, race, caste, sex place of birth, and residence. However, the domicile-based reservation laws violate it, as it discriminates based on place of residence. Subsequently, a question might arise whether it passes as an exception under Art. 16(3). The answer is no, because of Art. 16(3) gives the Parliament the power to make laws regarding employment to an office under the State providing requirements such as residence within the State.
In Kailash Chand Sharma v The State of Rajasthan, the issue was regarding the preferential treatment to a particular region in the appointment of government teachers in the state. The Supreme Court held, “ Any kind of weightage in public employment in any State service is not permissible on the ground of place of birth or residence or on the ground of being a resident of an urban area or rural area.” Such geographical classification cannot suffice as a criterion for social backwardness. Hence, residence in itself cannot be a ground for reservation, except as per the provision of Art. 16(3). Moreover, only the Parliament is allowed to make laws regarding such reservations. Likewise, in V.N. Sunanda Reddy and Ors. v State of Andhra Pradesh, the apex court struck down the rule which provided preference to Telugu medium in public services. Additionally, the enactment of the Public Employment (Requirement as to Residence) Act of 1957 was an instrumental step toward achieving equality. The said Act was passed with the sole aim to repeal all the existing laws prescribing any criterion of residence with any state for public employment. Therefore, the impugned laws are unconstitutional, as these laws are not based on reasonable classification, one of the essential requirements to establish a nexus with Art.14.
CONSTITUTIONALITY OF RESERVATION IN THE PRIVATE SECTOR
The domicile-based reservation laws provide reservations only in the private sector. Here, a very important question is whether the Union or State government can exercise such power over the private sector. The Constitution of India does not provide any such power or rights to the Union or State government. The Constitution only provides for reservation in educational institutions including private educational institutions and jobs in public employment, as enshrined under Art. 15(4), 15(5), 15(6), 16(4), and 16(6). Moreover, such reservation is done for the sole purpose of advancement of backward classes. Therefore, there is no mention whatsoever, of reservation in the private sector. If we follow the principle of literal interpretation, then it is ensured that the Constitution does not provide any provision for it and any enactment in this regard is unconstitutional. The provision of Art. 16(3) grants power to the Parliament to make domicile-based appointments regarding class(s) of employment and appointments. This means that the power granted by Art. 16(3) is limited in nature, as it is applicable for a certain class(s) of employment or appointment. Further, the power is vested in the hands of Parliament and not the state legislature. Most importantly, this power is restricted to public employment and not beyond that. In 2019, the Andhra Pradesh government enacted the Andhra Pradesh Employment of Local Candidates in Industries/Factories Act of 2019 which provided 75% reservation to natives in industries or factories. However, the Andhra Pradesh High Court observed that this act may be unconstitutional and sought a reply from the government.Though the State of Andhra Pradesh has a special status under Art. 371D which allows the direct recruitment of local cadres in specified areas, the Hon’ble High Court observed that the act of 2019 might be unconstitutional.
Similarly, the State of Karnataka has special status under Art. 371J. The government of Karnataka proposed 100% reservation in blue-collar jobs for the locals in the private sector. However, there was a certain rift regarding the enactment of the law. It was contended that the government can recommend the private sector to prefer the natives over others but they cannot make it binding on the private institution. Moreover, Faridabad Industries Association filed a case challenging the constitutionality of the Haryana State Employment of Local Candidates Act, 2021 in the Punjab and Haryana High Court. The court stayed the implementation of the act. Currently, the case is pending in the Supreme court.
CONSTITUTIONALITY OF RESERVATION ABOVE THE 50% THRESHOLD
States like Haryana, Madhya Pradesh, and Jharkhand provide 75% reservation to the locals, which is way higher than the sanctioned limit of reservation of 50%. In Indra Sawhney and Ors. v Union of India and Ors., the apex court held that the reservation for the backward classes in public services enshrined under Art. 16(4) cannot exceed the 50% threshold to maintain efficiency in administration. However, the court also held that this 50% rule can be relaxed in case of an extraordinary situation. Till now, no such situation has prevailed concerning the exemption. In Jaishri Laxmanrao Patil v The Chief Minister and Ors., the issue was regarding the Maharashtra SEBC Act of 2018 which tried to breach the 50% limit and avail of the exemption, but in vain. The Supreme Court held that the social, cultural, and educational backwardness of a community and inadequate data in public services do not suffice as an ‘exceptional situation’ and the act was struck down. Therefore, to qualify for the exemption, the classification should be based on intelligible differentia. Otherwise, such laws will fall foul of Art. 14, which happens in the case of the impugned laws.
STATES’ JUSTIFICATION FOR ENACTING THE LAWS
The states justify the impugned laws based on the influx of migrants in their respective states. Owing to the influx, it is getting tougher for the locals for getting jobs. For, instance, the Statement of Objects and Reasons of the Haryana State Employment of Local Candidates Act, 2021 was similar. It states that the reason behind the enactment of this act is the influx of migrants and its implication on the social, economic, and environmental aspects of the state. All the reasons fall foul of various levels of reasoning and jurisprudence. It tends to discriminate against the migrants.
In Dr. Pradeep Jain Etc v Union of India and Ors. Etc, Justice P.N. Bhagwati observed:
“ If India is one nation and there is only one citizenship, namely citizens of India, and every citizen has the right to move freely throughout the territory of India to decide and settle in any part of India…. To regard him as an outsider rupee to deny him as constitutional rights…” Thus, the reasoning behind the enactment of such laws is flawed and not in consonance with the Constitution.
In recent times, several states followed a distinct recourse of providing domicile-based reservations to the natives of their respective States. The steps taken by the Union or state governments to uplift the economically weaker sections or the backward classes are much appreciated and welcomed. However, at certain times, they get derailed and deviate from the purpose and bring in unconstitutional laws, fail to achieve the purpose as well as leave a negative impact on the people. For instance, the private sector is shaken owing to the impugned laws. This might discourage future investments in the respective states. The economic survey of 2019-20 showed that the government intervention diminished the ability of the market to incentivize new investment. This will severely affect economic growth. Therefore, government intervention should be minimized. Rather, a more reasonable and constitutional approach should be taken by the Union and state governments jointly to coup up with the problem of unemployment. For instance, the state can provide technical education to the native unskilled labour rather than leaving it in the hands of the private sector. This will ensure more recruitment of locals in industries/ factories and resolve the problem without the need for such laws.
Author(s) Name: Souvik Shaw (Department of Law, University of Calcutta)
Times of India, https://timesofindia.indiatimes.com/india/times-face-off-state-after-state-is-passing-or-proposing-job-reservation-for-locals-but-do-such-quotas-fix-the-unemployment-problem-or-drive-business-away/articleshow/82094665.cms (last visited on April 17, 2022)
Kailash Chand Sharma v The State of Rajasthan, AIR 2002 SC 2877
 V.N. Sunanda Reddy and Ors. v State of Andhra Pradesh, AIR 1995 SC 914
Public Employment (Requirement as to Residence) Act, 1957, No. 44, Acts of Parliament, 1957 (India)
Andhra Pradesh Employment of Local Candidates in Industries/Factories Act, 2019, No. 29, Acts of Andhra Pradesh State Legislature, 2019 (India)
New Indian Express, 75 per cent quota for locals may be unconstitutional: Andhra Pradesh High Court- The New Indian Express, (visited on April 17, 2022)
Decan Herald, Karnataka keeps law on job quota for locals at bay | Deccan Herald, (visited on April 17, 2022)
Haryana State Employment of Local Candidates Act, 2021, No. 3, Acts of Haryana State legislature, 2021 (India)
SLP (Civil) No. 3725 of 2022
 Indra Sawhney and Ors. v Union of India and Ors., AIR 1993 SC 477
 Jaishri Laxmanrao Patil v The Chief Minister and Ors., (2021) 8 SCC 1
Dr. Pradeep Jain Etc v Union of India and Ors. Etc, 1984 SCR (3) 942
Economic Survey 2019-2020, https://www.indiabudget.gov.in/budget2020-21/economicsurvey/index.php, (visited on April 17, 2022)