The Catastrophe of Livelihoods Caused by the Pandemic
K R Shyam Sundar
This is the second International Workers’ Day during COVID-19 and hence as dark as it was in 2020, if not darker. For several reason, it is darker in many senses for the working class. Let us briefly review what happened post-May Day 2020. It is important to recount on this International Workers’ Day.
The COVID-19, 2020 period witnessed several legislations both at the state and at the central levels hurting the hard-earned labour rights over centuries. Capitalizing on the extraordinary situation created by the pandemic, several state governments hurriedly, and even unwisely, passed government orders extending the maximum hours of work in a day from eight to 12, and in a week from 48 to 60 hours.
In Uttar Pradesh and Gujarat, the judiciary struck them down due to their illegality. On the other hand, some states dared to enter where angels feared to tread by making sweeping changes in all or some major labour laws like Factories Act, 1948, the Industrial Disputes Act, 1947, among others.
At the same time, the central government enacted three Codes – Industrial Relations Code (IRC), Occupational Safety and Health and Working Conditions Code (OSHWCC) and Social Security Code (SSC). The Codes afforded considerable flexibility to employers and contractors by exempting more establishments from regulations concerning standing orders, retrenchment and closure, safety and health, contract labour welfare, etc. The Codes provided some benefits to the working-class like universal minimum wage, trade union recognition, social security for gig and platform workers, wider definition of migrant workers, etc.
Seen holistically, the corpus of legislation provides some benefits which due to lack of effective implementation machinery and of will to implement on the part of the government mean little or even nothing; on the other hand, the employer-friendly clauses are easy to implement as they significantly reduce the role of the government in the labour market owing to increased non-coverage of establishments and workers. This is the irony of the labour laws which is often missed out by commentators. Laws deregulate and thereby cause state retrenchment.
Labour market governance
This brings us to the issue of governance of labour market. Labour market governance majorly comprises two aspects: administration of labour laws and collection of labour statistics.
The first year of COVID-19 has so vividly and so woefully brought to life the complete absence of labour market governance. Virtually there was no record of inter-state migrant workers and what happened to them during this period of the pandemic. Even the Supreme Court wondered in 2017 that the Comptroller and Auditor General (CAG) did not know where Rs 20,000 crore collected under the Building and Other Construction Workers’ Cess Act, 1996, meant for spending on construction workers’ welfare had gone! Earlier in 2015, the apex court expressed displeasure over the non-utilization of the cess fund of Rs 26,000 crore.
The unorganized workers did not receive the mandated smart registration card under the Unorganised Workers’ Social Security Act, 2008 (UNSSA). Even as the labour minister unjustifiably claimed that the OSHWCC provides better occupational safety and health protection to workers, the lack of valid and reliable statistics on industrial accidents is striking. In the meanwhile, industrial accidents have been occurring at frequent intervals in various parts of India, especially New Delhi.
What has [not] Changed?
The four labour codes have been hurriedly passed but not notified till now. I have provided a comprehensive critique of these Codes in my book, Impact of COVID-19, Reforms and Poor Governance on Labour Rights in India (Synergy Books India, 2021).
The central government has hastily used the escape clause in the Wage Code and notified the provisions related to the constitution of the Minimum Wages Advisory Board in December 2020; however, nothing has happened yet. The industry bodies have been reportedly lobbying with the government for changes in the definition of ‘wages’ since the new definition will likely see an increased outgo in social security. Economic slowdown and COVID-19’s virulent spread has impacted businesses and trade considerably and hence the non-implementation of the new Codes, especially the Wage Code, benefits the industry.
The central government fixed April 1, 2021 as the date for the implementation of the four Codes at a stretch. However, as on April 1, 2021, many state governments have not framed the rules under the Codes, leading to a delay in their implementation. Now this has created a “legal void” which in many ways affect both industry and workers adversely. Minimum wage rates are yet to be revised based on new criteria. Social security for the gig and platform economy workers cannot be implemented. The inclusive definition of migrant workers including voluntary migrant workers along with contracted migrant workers cannot be implemented. The list is long.
The “implementing authorities” are justifiably confused as to how to make the rules under the new Codes. Neither the Centre has helped their cause nor the state governments have sought the International Labour Organization (ILO)’s technical assistance in this regard –reflective of the government’s neo-unilateralism. Given the multiple and competing commitments that the governments face during the second wave of COVID-19, one does not see the implementation of the new Codes in the near future.
The employers and workers are staring at an uncertain interregnum during which neither old labour laws nor the new Codes are effectively relevant. This is perhaps the first of its kind in the legislative history of India that the social partners and even the administering agencies are confused and uncertain.
Labour market governance deficits
During the current COVID-19 period (2021), we are witnessing the second wave of reverse migration of workers who once bitten are twice shy. Despite some state governments like Maharashtra and New Delhi having appealed to the migrant workers to stay back, thousands of them have gone back to their villages.
The first period of COVID-19 exposed the utter collapse of the labour administrative system. I have dealt with the labour market governance deficits in detail in my book mentioned above.
Here are a few points on this issue that are also mentioned with evidence in the book:
- The existing unemployment insurance scheme is extremely inadequate, and during 2007-17, just about 10,000 workers claimed unemployment allowance under the ESI (Employees’ State Insurance) scheme
- Several state governments did not even disburse a single rupee from the Building and Other Construction Workers (BOCW) cess fund even as the migrant-cum-construction workers were facing terrible hardships;
- The state governments were poor performers in implementing the BOCW Act, 1996 despite admonitions by the Supreme Court;
- The state governments, the employers and even the trade unions have been guilty of non-provision of correct, timely and reliable statistics; the labour statistical system has collapsed beyond repair and there does not exist a comprehensive and reliable labour statistical system;
- The industrial disputes settlement machinery was grossly inadequate to deal with the magnitude of industrial conflicts and the dispute settlement processes suffer from inordinate delays;
- The labour enforcement machinery has been considerably diluted which reflected in poor implementation of laws as evidenced by steeply declining number of inspections, prosecutions, etc.
Given the cruel and entirely unforgivable failure on the part of the government in implementing the laws concerning migrant, construction and unorganised workers, one would have thought that the governments would have sprung to rectify the huge deficits. Did they? The delay and in a significant sense the complete failure to do so is appalling.
The central government has proposed five pan-India surveys on migrant workers, domestic workers, employment generated by professionals, employment generated in transport sector and quarterly establishment-based employment survey in February 2021 – nearly a year after the first exodus of migrant workers in 2020. The government is expected to release the data on migrant workers by November 2021.
Given the magnitude of migrant workers and the dynamic nature of their work, it is doubtful whether the government would accomplish what it promises. Without a credible database, it would be difficult even for an unusually benevolent and sensitive government to reach the benefits to the targeted workers.
Even in the new dispensation, there is no plan to collect data on the service sector on a comprehensive basis and that on gig and platform economy workers. The question here is: is there a national registry of these workers? The answer is a BIG NO. The government is playing with “guesstimates” and how credible are their promises for social security cover for these workers in the absence of a credible database?
We do not have credible statistics on the newly registered construction workers in India by states. Several state governments including Delhi have announced registration drives for construction workers, but we still do not know the actual live registrations of more than 55 million construction workers who accounted for 12.14% of total employment in India during 2018-19.
While the SSC does not provide for the provision of registration cards, which went largely unnoticed, since the old law, the Unorganised Workers’ Social Security Act, 2008, is prevalent, one does not know whether any constructive move has been launched for registering these workers. The silver lining in this data mess is the officially claimed significant coverage – 86% of the beneficiaries (69 crore) under the National Food Security Act in 32 states and Union Territories – under the One Nation and One Ration Card (ONOR).
The Union Budget 2021 did not provide much comfort to the millions of informal workers. It merely reiterated the ill-formed provisions in the labour codes. The high-frequency unemployment rates produced by Centre for Monitoring Indian Economy (CMIE) has been higher than 6.5% and throughout April 2021. The absence of macro-level unemployment assistance/insurance scheme, especially during high unemployment-prone COVID-19 times is hugely disturbing. The government has persisted with the tough conditions-laced unemployment insurance scheme offered to workers registered under the ESI scheme.
The SSC does not provide for unemployment assistance/insurance scheme even though it included them in the definition of social security. The MNREGS often acts as a proxied unemployment assistance program, and hence, generally when unemployment rates spike there is corresponding spikes in the demand for jobs under this scheme, as is the case in April 2021 when the demand for jobs under the scheme increased by 89%.
Given this grim reality, the fact that the budgetary allocation for this scheme for the current fiscal is 34% less than the revised allocation for it for 2020-21 is disturbing.
Absence of any form of dialogue
Enough has been said and written on the absence of and contempt for social dialogue in India even though the government has ratified the ILO Convention, C.144, Tripartite Consultation (International Labour Standards) Convention, 1976. The governments have to realize that concrete and useful relief measures cannot be framed and delivered without the aid of trade unions and other workers’ organizations.
Hence, there is an urgent need for the government to activate consultation with trade unions not only for amending the defective labour codes, but also frame policies and relief measures to tackle the increasingly menacing COVID-19 this year. Trade unions and workers’ organizations can help in registration of informal workers of various kinds which in itself will be a humungous achievement for workers in India.
There is also a need for a federal dialogue, and a revival of the historically established body, the Labour Ministers’ Conference. This is essential to frame coordinated and non-duplicating measures and also enable the state governments to frame the rules under the labour codes.
If the monolithic government in China could consult the ILO while framing and reforming its labour laws, what prevents the democratic government in India from consulting the ILO is difficult to fathom. ILO has expertise which if accessed would only contribute to better lawmaking and more efficient labour market governance. Not doing so must be attributed to its unholy marriage with “neo-unilaterlism”.
Need for contemporaneous May Day charter, 2021
Thus, the working class has to be prepared to brace another “bad year” or even years in near future as it fights two adversities – COVID-19 and the neo-liberal flexible labour policy regime. Then, May Day 2021 should strengthen its resolve to fight both. It should shelve its 12-points charter of demands and make ‘Lives and livelihoods matter’ as its slogan. The specific contemporary and urgent demands include:
- Amendment of labour codes to retain and improve on the existing labour rights
- Immediate implementation of the labour laws relating to unorganized sector workers, including migrant, domestic, construction and new economy workers
- issue smart ID cards to all these workers, involving trade unions and other workers’ organizations, and initiate a registration campaign for them
- Establish a comprehensive labour statistics system in consonance with international labour statisticians’ recommendations
- Declare minimum wages and occupational safety and health as fundamental rights
- Declare COVID-19 as a national emergency
- Ensure adequate labour administrative and judicial bodies for speedy delivery of industrial justice
- Universalise social protection
Significantly, the International Trade Union Confederation (ITUC) has demanded occupational safety and health to be included as a fundamental human right by the ILO at the global level and this should resonate in India as well. Trade unions must leverage international organizations like ILO and ITUC to strengthen its campaign to usher in decent work and also more crucially to tackle the COVID-19-induced crisis. The four-pillar approach advocated by ILO must be at the centre of policy lobbying by trade unions. Industry could join as it stands to benefit from these campaigns as in these tough times, the interests of both converge.
The article first appeared in The Wire May Day 2021: What Has (Not) Changed Since the Pandemic Ravaged Livelihoods of Workers on May 02, 2021.
About the Author
K R Shyam Sundar, Professor, HRM Area, Xavier School of Management (XLRI), Jamshedpur, Jharkhand.
Watch Prof K R Shyam Sundar at IMPRI #WebPolicyTalk
Impact of COVID-19, Reforms and Poor Governance on Labour Rights
Panel Discussion on Migrant Workers, Labour Rights and Policy: Impact and Way Forward