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Mainstream, VOL LVII No 20 New Delhi May 4, 2019

Why Proposed Labour Reforms may be Harmful for Workers

Sunday 5 May 2019, by Bharat Dogra

The following article is being published on the occasion of May Day 2019.

There has been a growing concern in recent times that the ongoing process of labour reforms may end up significantly reducing and eroding labour rights and some of the positive results achieved after years of struggles may be lost or diluted to a significant extent. Already a series of changes have led to the growing casualisation of the labour force and the share of contract workers is now significantly higher even in the organised sector. As is well known, contract workers have much lower wages, social security and job security. The entire trend is towards less job security and limited period employment which is supported by government policy. The livelihoods of workers, including self-employed workers, in many lines of work was badly disrupted by demonetisation, GST and indiscriminate imports to such an extent that some of them have still not entirely recovered from this.

It is against this background that the proposed main ongoing reform of reorganising 44 central labour laws in four Labour Codes should be seen. This reorganisation into more compact laws is itself not wrong if done fairly with commitment to the cause of workers. The problem arises when this becomes a pretext for diluting and eroding the rights of workers.

The proposed bill relating to the first such code is called the Labour Code on Industrial Relations Bill 2015 (LCIR). A recent study by Vaibhav Raaj, titled ‘Labour Law Reforms in India—A New Social Contract’, says that the purpose of the LCIR goes beyond mere consolidation of the existing laws. As this review points out, the LCIR contains provisions for heavy fines on workers and trade unions for violation of expansive and strict guidelines for filing returns and indulging in ‘unfair labour practices’. In addition the LCIR has expanded grounds for cancelling of registeration of trade unions. Further, “the special immunities provided to registered trade unions under the Trade Union Act and the Industrial Disputes Act are proposed to thinned to negligible levels to the extent that strikes and lockouts by workers are proposed to be made effectively illegal by extending the definition of public utilities to all industrial establishments and requiring two and six weeks notice for strikes. Instances of more than 50 per cent of the workers of an establishment taking simultaneous casual leave for any reason will also be classified as strike.” In addition separate legislation for small units employing less than 40 workers which suspends 14 central labour laws in their context was also considered but after much resistance from workers has been shelved for the time being.

Regarding the second bill, the Code on Wages, 2017, Bill No. 163 of 2017, this study says, “While the Bill addressed a few concerns raised by workers, many issues still remain that may jeo-pardise the livelihood of millions of workers through diluted protective standards and diminished accountability mechanisms in the provisions of the Bill.—The suggested criteria for setting minimum wage wages completely bypass and potentially violate established jurisprudence on required needs-based criteria for setting of minimum wage rates.”

In the case of the third draft labour code on social security and welfare, while it is clear that the new social security system will rely almost completely on contributions made by workers and employers, the scope of tripartite processes in determining the management of social security is in the process of being greatly reduced. There is heavy domination of the Central Government in the new emerging structure.

Clearly there must be a serious and wide debate on the proposed so-called reforms so that the erosion and curbing of hard-won rights can be checked.

The author is a freelance journalist who has been involved with several social movements and initiatives.

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