Sweeping changes in the labour law: Major concerns associating it

–Kakali Das |

Amidst the entire Coronavirus pandemic that the country is battling against currently, we have seen a mass exodus of people leaving the cities for their villages, loaded in the trucks in few of the most heart-wrenching conditions. Meanwhile, a few of our state governments are completely overhauling labour laws in order to, as they say, revive the economy and boost growth in their respective states post the lockdown. In Madhya Pradesh and Uttar Pradesh, labour laws have been entirely tossed out for the following 1000 days and 3 years respectively, paving way for minor changes in Rajasthan and Punjab as well.

Labour law, also known as employment law, mediates the relationship between workers, employing entities, trade unions and the government. The factories, under this law, looks after the safety, health and welfare of the workers; The Shops and Commercial Establishments Act, 1961, regulate the hours of work, payments, weekly leave every year, over-time, child labour and so and so forth. The Minimum Wages Act, 1948, regulates how companies can lay off their employees depending on any retrenchments and the rules concerning that and, most importantly, the act modulates the minimum wages of the employees. The question concerning it is, “Is the tossing of the labour law really going to revive the sectors? Or Is it going to open the doors for large scale exploitation of labour.”

Since the Honorable Supreme Court of India, in the Bangalore Water Supply and Sewage Board vs. A Rajappa Case, has given a broad and extensive definition of the term ‘industry’ under Industrial Dispute Act, 1947, hence, even Kamakhya Temple, Tirupati Temple, as a matter of fact, can be termed as an industry – the contract labourers of the Tirupati Temple were removed from the service, recently. A grocery shop, a club, a hospital, a paan shop, an IT company – any systematic activity carried on with the workers and a management team to produce goods and services – come under the umbrella of the term ‘Industry’. So, the tossing of the labour law will affect in numerous workers/employees – it won’t merely be a traditional blue collared man in a factory with a chimney and a fence who would get affected by this measure.

While a lot of these are mere speculations and we only have a cabinet note of the Uttar Pradesh government, in the social media there is an alleged draft of an ordinance that has been circulating – hence, we don’t know the exact contours of what this law is going to be. One of the concerns in the minds of the people is, “Will there be weekly-offs if the overhauling of the law takes place?”. Even the Minimum Wages Act, too, is one of the acts scheduled to be suspended. However, the draft which is circulating says that the government on its own will fix a minimum wage outside the statutory norms – proving how chaotic the system already is! Another provisions like ‘gratuity’, where a person has worked for decades and about to retire – if this law gets tossed out, The Payment of Gratuity Act, 1972 won’t be there and the employee will have to be deprived of it. Also, there are certain important central legislation like the Provident Fund Act and the Employees State Insurance Act – the contribution based laws where the workers have contributed for years – there’s still a lack of clarity whether these laws would too get suspended or not. Of course, the proposed cabinet note and the alleged draft being circulated exempts women and children, so we could assume that the Maternity Benefit Act, 1961, the Child Labour Regulation and Prohibition Act, 1986 would continue, however, an important law like the Trade Unions Act, 1926 would get scrapped. As the constitution guarantees the right to form associations and unions, if, I reiterate, if, the women workers want to form a trade union to protect the rights of women workers – on the one hand, the government would protect the women and on the other hand, chuck out the Trade Union Act, including the Industrial Disputes Act, 1947 – the act which gives the right of the workmen to approach a labour court or an authority complaining for their grievances – how conflicting would the measures be! Moreover, in regard to the payments of the wages, only section 5 of The Payment of Wages Act, 1936, will apply – which merely gives 10 days’ time to pay the monthly wages, however, the authority under the Act to where one can complain to, where one can get 10 times the compensation for lesser payment of minimum wages – are all obliterated. This, actually, will prove to be an anti-women legislation of ordinance, if it takes into place, as it will encourage the employers not to hire employees since they will have to ensure those laws applicable to women are employed. But again, these are just speculations and conjectures.

 I would like to give a reference of the William Beveridge Commission, immediately after the World War II, where the commission recommended that since a lot of chaos had happened around the world and they had to arrive at some substantive measures to fix the workers problem, therefore as an outcome, the Employees’ Provident Fund Organisation (EPFO), Employees’ State Insurance Corporation (ESIC) in the year 1952, including the most radical legislation which talked about the statutory protections to the working class – all these came into existence. Secondly, the Bandhua Mukti Morcha vs Union of India and the Umrao Singh Choi vs State of Kerela – two of the most powerful Supreme Court judgements talked about “wages as a constitutional right”, and hence, can never be denied. It’s astounding now to witness the government using the ordinance process to completely dismantle the labour laws which the working class earned after struggling for decades. In the World Bank reports, the talks are about the ease of doing business, the motives of defeating China, the building of industrial production, economic growth –  but the concept of “labour law” doesn’t stand in any of the major global reports. The government is attempting to make laws which are going to exploit the working class more. Historically, it was witnessed that whenever and wherever there were flexibilities and weakening of the labour laws, there were more chaos – for instance, the Maruti Suzuki Plant Case (2012) where several workers rioted over a disciplinary issue with an employee and in the process, the manager was set on fire in a conference room. Experts had pointed out that labour laws were compelling companies like Maruti to rely heavily on contract labourers, who were easy to fire with far less salary and benefits than permanent workers. The question that arise here, “Are we heading towards an authoritarian regime?” – as it will create extreme social unrest in the country.

The Union government had decided to divide the central laws into four parts – individual industry relation, wages, social security and occupational safety. Based on these parts, some state governments have passed their ordinance, whereas, these ordinances which are coping up with the union government’s enactments, if any certain deviations arise, the union law will be prevailed. But the restructured process post the coronavirus pandemic is mandatory – as the unorganised sectors, immigrant labourers have moved or are moving away from the workplaces to their villages, to their families where they are located. The employment opportunity of the respective states for those stranded workers should be provided. Keeping in view of all those facts, attraction of investments is the mandatory measure – the core issue is to provide employment opportunity post the current pandemic, and not merely concentrating on the loopholes of it. There is an immediate need to check thoroughly the provisions in the ordinance, instead of circulating few points of it in the social media.

The Coronavirus pandemic, which has been used as an issue for everything, hasn’t happened in vacuum; the pandemic is like a tail end of a cyclone which already was facing the Indian economy – we were in the doldrums – the industries, the small-scale industries were all looking for packages and bailouts even before the pandemic came into existence. Hence, firstly, the pandemic shouldn’t be made as an excuse. Secondly, when the pandemic has broken out, to say that the states will decide and it’s the states’ responsibility to reimburse for the losses, is absolutely unacceptable – ultimately it’s the President of India, who will give concurrence to this, since the central laws enacted by the parliament of India are about to be suspended. Therefore, to think that these employers, on one hand, without any bailout by the government and on the other hand, by permitting them to strike out whoever they want in the next three years – if it’s to be thought that these measures will revive the economy or lead to mass scale employment, then it’s far to be true. Moreover, it’s utmost necessary to understand that The Industrial Dispute Act, 1947, is an act meant for both an employer and an employee. In Surat, the workers were agitating and being aggressive because the employers hadn’t made them their payments and under this Act, the moment an employee gets agitated, the employer can run to the labour authority and can start a conciliation process and while the process continues, the employees can seldom indulge in any strikes or in violence. Likewise, if these laws get scrapped, the employers would hardly take any responsibility of their employees if any accident or mishap takes place. Hence, it’s strongly evident that by striking off the labour laws, the government is actually taking away the security blanket and the protection for both the employers and the employees as well.