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Law Reforms Won’t Solve Labour Problems

Law Reforms Won’t Solve Labour Problems

From its inception of 2014 NDA government the debate on the labour law reforms have been held in almost all the developmental discourses across the country.  Now reiteration of the labour law reforms in the 2019 budget has deepened deliberations on the same again.

The core of labour regulation reforms is based on a common understanding between the Government and employers’ organization that the existing labour rules of the country are outdated due to its archaic and overlapping nature and are hindering  easy business and industrial development, hence resulting in high unemployment rate. To address this concern they hold on to the recommendations of the second labour commission’s report 2002, which mainly suggested the coordination of all labour laws and a separate informal workers’ labour law to protect the rights of unorganized workers.

The review press release of Government of India, Ministry of Labour & Employment, in the month of December 2018 called the reform of labour laws as an ‘act of rationalisation’. Indian Staffing Federation, the employers’ official body,   opined   most of Labour   regulations were written in a different era, irrelevant to present conditions. In addition, data analysis by Leadership Capital, a people’s management  international firm, confirmed the same  by pointing out 17 different definitions of ‘workers’ and ‘wage’ from the existing labour laws. So India had inconsistency and non-uniformity in labour law’s terms and conditions. In this background, it has been said that if the labour law reforms bring in simpler rules, India, with its progressive facilities, would experience a boom in formal employments.   

Workers and their organisations/unions see any new reforms as futile, unless it comes with effective labour law enactments and its administration be supported by human resources and infrastructure. Otherwise, all kind of regulatory reforms will be a ‘political exercise’ and for the benefit of employers, especially in these times of high increase in Flexi staff system ( temporary contract jobs). The need is not the reforms of labour law, as the existing labour laws do not much affect these informal workers in the formal sectors. Therefore in this background, a labour law reform would only help to establish an employer friendly labour scenario, where labourers would increase in unorganised sectors, witness lower wages and long working hours.  

A major step of Government in connection with labour law reforms is the merging of 44 existing labour laws into four   labour codes: Wages, Industrial Relations, Social Security & Welfare and Occupational Safety, Health & Working Conditions.

Among them, so far the wage code bill is tabled in Lok Sabha and received the final recommendations from the Standing Committee on Labour. The rest of the codes are yet to be introduced in the parliament. Presently these codes drafts were being deliberated by different panels set up of the Ministry of Labour and Employment. The Union Cabinet has this week approved the Code of Occupational, Safety, Health and Working Conditions.

The Code on Wages Bill proposes a statutory national minimum wage for different geographic regions. The Code of Occupational Safety, Health & Working Conditions Bill proposes to include regular and mandatory medical examinations for workers, issuing of appointment letters, framing of rules on women working night shifts.

Labour Issues Galore

In spite of several   labour law   reform initiatives in the last five years, several   labour related issues have been plaguing the country: the   increase of unemployment, growth of informal sector   workers, lower   salary for qualified employees, lack of social security and no provision of   paid leave even for salaried employees, underpaid workers,   lower productivity of workers, less participation of women work force, unsafe   working conditions, inability to abolish ‘social evil’ child   labour. These ground realities of the country’s labour scenario means that India has issues of labour and its administration, not lack of labour laws as such.  

In this context, the   proposed labour law reforms seem to be an incompetent effort and would help only employers and adversely impact employees. It looks more as ‘a political exercise’ and an act for reform's sake in order to get the whip hand, as in the case of demonetisation. India currently needs a real labour reform with support of policies and programs instead of mere labour law amendments and coding with help of information technology. The real Labour reform should include appropriate labour law enactments and introduce administrative labour law implementation system with the support of resources and infrastructures   at villages across the country, apart from labour courts and commission. That could be called ‘workers facilitation centres’ as NCEUS in 2006 suggested based on second labour commission’s recommendations. Workers facilitation would be more relevant in the context of deregulation of labour markets, increase of Flexi employee’s system or in formalisation of formal sector in these times of weakened trade unions .   For these desirable steps and   having decent work and dignified workers,   first and foremost a deep   study should have been carried out   to know the ground reality of workers’ issues. This study can also be conducted in perspective of digitalisation, Cigi and Flexi work culture and automated  artificial intelligence tools, which are  affecting the labour  economics at present. That would be a comprehended approach of labour reforms, fit to be called a ‘nation friendly   labour reform’ than   either employer   or worker friendly.

(The writer is Founder Director of Workers’ India Federation, )

(Published on 22nd July 2019, Volume XXXI, Issue 30)