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In the month of April when the country was observing a lockdown, few Indian state governments notified to reform or suspend most of the labour laws in the formal sector. This was done to provide impetus to the struggling industrial sector and offer them some flexibility. The laws that are going to be exempted are related to occupational safety in factory premises, working conditions of workers, wages, hazardous work, overlapping shifts, inspection in a factory, hire and fire policy, industrial disputes, mandatory welfare measures, and the workers’ right to form trade unions. But these state governments took these decisions without any public appeals (for exemption) from industries or industry bodies.

Major reforms

In the first phase of the reforms, Uttar Pradesh (UP), Maharashtra, Rajasthan, Gujarat, Goa, Madhya Pradesh (MP), Uttarakhand, Assam, Punjab, Haryana, and Himachal Pradesh state governments increased working hours from 8 to 12 hours. Further the UP government passed the ‘UP Temporary Emption from Certain Labour Laws Ordinance - 2020’. Along with UP, the state government of MP suspended majority of its labour laws for three upcoming years while Gujarat suspended these for the next 1200 days.

Labour legislations like the Building and Other Construction Workers Act of 1996, the Child and Adolescent Labour (Prohibition and Regulation) Act of 1986, the Workmen’s Compensation Act of 1923, the Bonded Labour System (Abolition) Act of 1976 and the Section 5 of the Payment of Wages Act (for timely payment for wages) of 1936 are not going be diluted by the ordinance. Tapan Sen, All India General Secretary, Centre of Trade Unions (CITU), told BE, “They did it without amending the Factories Act and took advantage of the National Disaster Management Act and the Epidemic Act where public emergency is considered as a provision. This is not meant to fight the Covid pandemic. The Indian industries are indeed struggling due to the shrinking purchasing capacity of people and not because of our existing labour laws.”

Central government objects

The implementation of labour regulations falls under the concurrent list – that is it can be implemented by the central as well as the state government. But in case of conflicts between them, the decision taken by the central government prevails. The state governments of UP, MP, and Gujarat sent the ordinances of their labour law reforms to the President of India for approval and requested a response from the central labour department. But the central labour department had initially stated that the reforms or suspension of labour laws are not in “sync with the labour law codes proposed by the Centre.”

In 2019, the central government proposed a bill consisting of four labour codes subsuming the labour laws to simplify governance on the matter. The ministry later stated that the present changes suggested for the labour laws are contradicting with the International Labour Organisation (ILO) guidelines and being a signatory member of ILO, India cannot violate its guidelines. After 10 trade unions protested against these reforms, ILO appealed to the Indian Prime Minister to look into the matter.

Will this boost industry?

The reforms in labour laws to attract investments and revive the industries are being opposed because economic growth at the cost of labour rights creates more problems. Industries depend on a two-way relationship between workers and employers. Industries offer employment while the workers keep the production wheel running. The social and economic upliftment of the workers only enhances growth and productivity for the industries. If any industry is struggling, the government can pump money to them and they can keep paying their employees and run the business.

Brijesh Upadhyay, All India General Secretary, Bharatiya Mazdoor Sangh (BMS), told BE, "We are opposing the suspension as this is contrary to labour rights and the labour laws are not road blockers for the growth of industries. First phase of our movement has been completed on May 20 and it will be continued. Rather than suspending the labour laws, both the central and state governments should initiate specific financial policies to boost industries.”

Rahul Bajaj, MD and CEO, Bajaj Auto recently informed the media, “In India, industrialists experience extreme situations. Either there is no hire-and-fire policy leaving no elbow room for the businesses or everything has been thrown out from the workers. A middle path is lacking.”

Worsen the social security of workers?

During the wake of Spanish flu in 1918-19, workers were forced to work in factories without any precautions which triggered widespread of the virus and later hampered productions in industries. So, it is still under question that how exemption of the law on occupational safety of labourers can help industrial growth. The exemption of the Factories Act on working hours and Industrial Disputes Act on hiring and firing guidelines will degrade the working conditions. The central laws like the Minimum Wages Act, Payment of Wages Act and Payment of Bonus Act are functional to guarantee the social and economic security of the workers. Suspension of these laws in a weak economic situation will lead to more anguish for the Indian working class.

Constitution defends workers’ rights

The Article 23 of the Constitution protects ensures protection from exploitation. The Supreme Court in the People's Union for Democratic Rights vs. Union of India, [(1982) 3 SCC 235, para. 15] case held that if a worker is providing service in less than the minimum wage, then “The labour or service provided by him clearly falls within the scope and ambit of the words ‘forced labour’ under Article 23." The Supreme Court further held that “It is the constitutional obligation of the State to take the necessary steps for the purpose of interdicting such violation.”

During the lockdown, a major section of the workers are losing their jobs and most of them are living without any payment - if not already sacked. Most of them are depending on government rations or support from various social organisations. There's a need to ensure workers get a decent wage rate and working conditions and the industries do well because of better performance of their workers.