Ajay Singh Solanki
AZB & Partners, Mumbai, Maharashtra
ajay.solanki@azbpartners.com

Sayantani Saha
AZB & Partners, Mumbai, Maharashtra

Diversity, equity and inclusion (DEI) seems to be at an inflection point in the Far West with the three concepts having witnessed quite a roller coaster ride in the recent past. At one point, there was a major push for global employers to enhance their DEI quotient to ensure adequate representation in their governance and to fulfill their social responsibility and ESG goals as corporations. However, owing to recent shift in perception and obligations in relation to DEI, global corporations are seeing an unforeseen upheaval in their DEI policies.

While the Far West is experiencing this drastic shift, the legislative framework in India remains unchanged in promoting diversity and ensuring anti-discrimination. Indian employers in the private sector need to remain responsible to ensure there are equal employment opportunities for individuals belonging to legally protected categories; essentially, women, persons with disability, persons with HIV and transgender persons. Keeping this in mind, employers are often curious about their ability to legally collect diversity data from their employees in India. Here, we explore the nuances of continuing to collect diversity data in India in the dynamic DEI space.

India is a land of diversity, which is reflected equally in its workplaces. Embracing diversity goes beyond mere representation, fostering a culture of mutual respect, understanding and collaboration among employees. It encourages organisations to value different perspectives and experiences, often leading to innovative solutions and better and equitable decision making. In the Indian context, diversity encompasses gender inclusivity, addresses the urban-rural divide and provides opportunities for underrepresented groups such as people with disabilities and economically disadvantaged communities. Keeping the same in mind and interests of sections whose social participation is impaired, and consistent with the Indian Constitution, there are laws that promote inclusivity in the workplace to ensure diverse voices are present at the workplace.

Legal framework on workplace diversity in India

Women

Besides the Indian Constitution, one of the earliest laws that promoted diversity in India was the Equal Remuneration Act 1976 (the ‘ERA’). This law requires employers to provide men and women performing the same work, or work of a similar nature, to be paid the same remuneration. Employers are also barred from discriminating against women in various aspects like promotion, transfer, training or recruitment. There are requirements under the ERA for employers to maintain records of number of male and female employees at their workplace, which becomes tricky, especially where it comes to the LGBTQI+ population. Additionally, under the Maternity Benefit Act 1961, women employees (including those engaged through third parties) are provided (1) protection against employment termination while they are on maternity leave and (2) security against the loss of maternity benefits, if their employment is terminated while they are pregnant but not on maternity leave.

There are also laws requiring employers to ensure that female employees are provided adequate safety at night, including safe transport, security and other protections. There are requirements in respect of monitoring the route taken by the transport service picking up or dropping off female employees. Further, there are requirements for employers to ensure adequate background checks for drivers of such commutes prior to their engagement.

Additionally, the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (the ‘PoSH Act’) requires employers to have frameworks to protect women employees from sexual harassment in the workplace. There are strict requirements under the PoSH Act in respect of confidentiality of the identity and details of the complainant, respondent and witnesses. The PoSH Act also requires employers to educate their employees on the provisions of the law, to prevent sexual harassment.

Disability

There are laws to protect persons with disabilities against workplace discrimination. These laws also require employers to provide equal opportunities in recruitment with the provision of necessary reasonable accommodation for persons with disabilities. There are requirements under the Rights of Persons with Disabilities Act 2016 for employers to collect and maintain certain disability-related data pertaining to their employees, as may be disclosed. The Mental Healthcare Act 2017 prohibits discrimination against persons with mental illnesses in terms of the provision of healthcare. This law also prohibits breach of confidentiality in respect of an individual’s mental illness, although there is no specific obligation on employers in this respect.

Transgender persons

Under the Transgender Persons (Protection of Rights) Act 2019 (the ‘TPPR’) protection is also provided to transgender persons regarding the provision of equal employment opportunities and a prescribed framework to ensure grievance redressal in case of discrimination.

Persons with HIV

Under the Human Immunodeficiency Virus and Acquired Immune Deficiency Syndrome (Prevention and Control) Act 2017 (the ‘HIV Act’), besides ensuring equal employment opportunities and prohibition against discrimination of persons with HIV, there are additional protections provided to persons with HIV and individuals living with such a person as per the HIV policy introduced by the central government in 2022. There is strict legal requirement on the maintenance of confidentiality regarding an individual’s HIV status as per the HIV Act. The HIV Act also requires employers of workplaces with 100 or more employees to conduct sensitisation programmes on the law, besides providing a specific grievance redressal mechanism.

Scheduled castes and tribes

There are Indian laws prohibiting atrocities against individuals from scheduled castes and tribes as per the Scheduled Castes and Tribes (Prevention of Atrocities) Act 1989 (the ‘SCST Act’). Those belonging to the scheduled castes and tribes have historically been considered as marginalised individuals, requiring affirmative actions to bring them to par with the rest of society. Offences under the SCST Act may lead to strict penal action against the perpetrator.

Things to consider while collecting diversity data

Potential risks

Irrespective of the global shift, Indian laws continue to protect diversity and rights of individuals from underrepresented communities at the workplace. Keeping the same in mind, employers need to be mindful of the diversity data that they collect from their employees. If such data is not anonymised, it may lead to potential claims of discrimination against the employer and its representatives. Furthermore, employers may wish to avoid the collection of information in respect of characteristics that are legally protected and have strict requirements in respect of an employee’s confidentiality.

Risk of wide net

Global employers often have broad protections against discrimination at the workplace, as a legacy of their global practices. With the global mandates on DEI narrowing at this stage, it may be prudent for employers to have a relook at such wide protections provided to employees, which may lead to frivolous discrimination claims.

Data privacy

Further, there are data privacy laws, which regulate collection of certain sensitive personal data or information (SPDI) in electronic form. SPDI includes an individual’s physical, physiological and mental health conditions, sexual orientation, medical records and history and biometric information. Accordingly, for collection of SPDI, employers currently need to comply with the Information Technology (Reasonable Security Practices and Procedures and Sensitive Personal Data or Information) Rules 2011, which require data collectors to obtain consent of the data subject to procure SPDI and to have a privacy policy for the handling of or dealing in SPDI and complying with the same.

Note that India has recently enacted the Digital Personal Data Protection Act 2023 (the ‘DPDP’), which is yet to be made effective. Once the DPDP comes into force, employers may potentially have some flexibility in processing information in connection with employment.

Cultural nuances

India remains a conservative society in terms of an individual’s gender identity. Accordingly, employees may be reluctant to provide gender-related diversity information. Further, such information may also be subject to data privacy considerations.

Similarly, information on an individual’s caste, tribe, religion and ethnicity (including regional ethnicity) may lead to potential claims of biases and discrimination. Accordingly, it is preferable to avoid proactively collecting such information from employees.

Conclusion

The laws on diversity at the workplace are aimed to create an inclusive work environment respecting India’s culture and unity in diversity. By promoting diversity, Indian organisations can foster a culture of mutual respect and understanding, benefitting both employees and society at large. Indian organisations contributing to global decision making may also create better impact through diversity perspectives in the workplace.

However, with the global shift in outlook towards diversity, it may be prudent for employers to rethink their practices to mitigate exposure to potential claims. In order to preserve the spirit of unity in diversity, it is important to sensitise employees towards the needs of historically disadvantaged sections of the society and opportunities to create a more inclusive and impactful workplace.