Don't call it reform (The dilution of labour laws is a travesty)

Excellent study material for all civil services aspirants - begin learning - Kar ke dikhayenge!

 Don't call it reform (The dilution of labour laws is a travesty)

---

Read more on - Polity | Economy | Schemes | S&T | Environment

---

• Labour law reform: Everyone agrees that Indian labour laws needed reform, but the May 2020 ordinances by state governments to change labour laws are not reforms, but assaults on workers' rights. Working hours are being increased, so labourers will slog more and more. Grievance redressal mechanisms are being removed, so no question of justice! Labour will be left with no bargaining power.
• Problem with Indian labour laws: They represented the interest of only 10% of the labour force, not the other 90%. And they hurt both capital and labour. The factory owners had little incentive to generate more formal protection for workers.
• Bargaining power: It is wrongly assumed that Indian labour had a lot of bargaining power and that retarded industrialisation of India. From the 1980s, if the labour movement's lack of vitality is seen, it is proven.
• What labour laws did: They hardly protected the workers, and were extremely complex. They were rigid, and allowed a political economy of rent-seeking. Those businesses that could "manage" the state, flourished! Genuine innovators suffered.
• Modi's thought: He was right in trying to reform these, and the 2019 "Industrial Relations Code" was a step in right direction.

1. Standing Committee report came in April 2020.
2. This could have led to a modern, new labour code fit for the India of 21st century.

• New attack after the pandemic: But what happened was that the Code didn't turn into Law, and pandemic arrived. The 4 pronged attack on that Code now is -

1. Ordinance route to attack constitutional values - States are brazenly issuing ordinances and suspending crucial laws! The Parliament was discussing this issue already. Federalism is under assault, by the states, as central legislation is being over-riden. ILO conventions will be contravened. Work hours are being raised to 12 (from 8) without raising wages (and without a weekly upper limit). Flexibility at the cost of workers' health is useless. The President can simply withhold assent (constitutionality, democratic propriety, application of mind). Pandemic is when workers cannot even protest - so are States amassing power undemocratically?
2. Assault on bargaining power - Labour anyway has become powerless in past few years. Social security is nearly absent. Many migrant labourers simply do not want to return now, due to exploitative working conditions. Why can't we widen MGNREGA? Companies hate that idea, as it improves the labourers' bargaining position a little bit (by putting a wage floor).
3. Assault on labour's existence itself - We are told that companies leaving China aren't coming to India due to "labour problems". So they must be set right!
4. Authoritarianism in vogue - It is frightening to see how people are cheering the 12 hour working days, and the elimination of complaints mechanism. It's pure authoritarianism and a society devoid of compassion.

• What is "Reform": The word reform does not mean ending environmental norms! Clean air and water is reform, not removing laws that ensure those. Genuine labour law reform is about protecting workers' core interests, respecting their bargaining power and ensuring no distortion in capital allocation. The Indian Chief Ministers are not reforming, they are pushing authoritarianism.
• Warning: The Industrial Code of Modi govt. was a good idea, but these ordinances will destroy that! Without investing in our human capital, can we ever prosper? Let us not get into a new 19th century barbarism.  
• Summary : The manner in which states are rushing to dilute existing labour laws, to attract fresh investments, won't stand judicial scrutiny and is wrongly motivated.

Read more on - Polity | Economy | Schemes | S&T | Environment

Join UPSC Self Prep course | Online Course (PT Gurukul)  | Covid Special Course | Join PT courses

* Content sourced from free internet sources (publications, PIB site, international sites, etc.). Take your own subscriptions. Copyrights acknowledged.