Haryana: FICCI Recommends Government of Haryana to Legalize Office Gray Market

The Federation of Indian Chambers of Commerce and Industry along with international real estate consultant JLL has submitted a research paper to the Government of Haryana to highlight the ‘grey office market or work from home’ in the state and recommended regulating it as a formal and licensed sector.

In line with the Government of India’s Skill India and Start-up mission, the study has suggested significant steps backed by the survey and analysis of employee perception in recent times to incorporate their home, as a place of work formal and affordable.

The research paper has highlighted the quantum of informal offices/affordable workspaces in Haryana and intends to brainstorm all the measures that could change the dynamics of the office industry and contribute to the formal economy of Haryana.

Vineet Nanda, Chairman, Regional Urban Infrastructure Committee, FICCI, presented the white paper titled “Home: The New Workplace” to K Makrand Pandurang, Managing Director and Special Secretary, Town & Country Planning, Haryana and Vishal Bansal, Chief Accountant General AI&AS (Audit), Hariana.

Vineet Nanda and FICCI Regional Director GB Singh briefed them on the changing dynamics of workspaces post-pandemic and recommended reframing and legalizing the office gray market in a systematic way.

This move will contribute to the formal economy of the state in the form of increased GST and property tax collection as well as improved property regulations. The office gray market consists of informal spaces operating from home-based facilities primarily used by small start-ups, non-unionized workers and unemployed/remote workers.

According to data from the Ministry of Labor and Employment, about 27 million people have registered as part of the unorganized labor force.

“The presented FICCI/JLL white paper deserves some soul-searching and a step in the right direction. The Government of Haryana is supporting the start-up ecosystem in the state and in this regard, we would like to further research with FICCI/JLL to understand the gap in needs. We are encouraging young people from Haryana and across the nation to join the formal sector of business and commerce and build their start-ups in Haryana State,” Pandurang said.

The move is expected to benefit over 700 start-ups and six lakh unemployed professionals in Haryana. Benefits of the policy suggestion include compatible land uses by discouraging intensive commercial developments, legalizing unorganized commercial activities, less or no travel hence reduced carbon footprint and various benefits to the government in the form of revenue collection through the GST, property taxes adding another source of revenue to contribute to the economy of the state.

“Since the start of the pandemic, we have seen a significant number of start-ups operating from informal spaces, mainly in homes, and unemployed people embarking on part-time businesses from home. “Working from home” is the new normal. I think moving is profitable, quick and full of opportunities, especially for entrepreneurs and the unemployed. The policy will propel Haryana’s formal economy and help improve property regulations,” said Vineet Nanda.

The advent of hybrid workspaces and changing work dynamics in India have accentuated the need for a space that is more interactive than pure commercial and residential use. Creating affordable and efficient workspaces and interactive land uses will improve the environment for the unorganized business sector, home-based workers and new-age start-ups.

This will not only benefit the urban infrastructure sector as a whole, but will also contribute to the creation of more entrepreneurs, jobs and a better quality of working life.

“About fifteen lakh of Haryana’s informal workforce works in unregulated home-based establishments. The lack of inclusive policies that address workers, businesses and industry as a whole has only compounded the problem. There is an urgent need for all stakeholders to work towards inclusive regulatory and policy changes and think beyond the WFH,” said Akash Bansal, Principal and Head of India – Consulting.

Based on surveys and analysis of employee perceptions in recent times, the demand for commercial space is increasing in major cities.

There is significant demand from the informal commercial segment, which currently operates on an unregulated basis, which can also be referred to as the “grey office market”

Over 25% (about 52 lakh) of Haryana’s informal workforce works in unregulated home-based establishments, 24% in construction, 30% in agriculture and 21% in other sectors .

Out of 3,500 start-ups, about 2,800 start-ups are registered and operating in the formal sector, on the other hand, 700 start-ups operate from informal spaces – mostly home-based establishments, in Haryana which may involve 9,000 -10,000 approximate workforce

6 lakhs of unemployed professionals are job ready and actively seeking employment in Haryana.

A significant number are involved in part-time businesses run by home-based establishments. The lack of inclusive policies that address both workers and businesses has only compounded the problem.

Jose C. Birney