Bridging the Inequality Gap

Context: Labour codes need to be drafted, keeping in mind the realities of informal sector workers.

Status of informal employment in India:

• 450 million informal workers (90% of the total workforce), with 5-10 million workers added annually. Nearly 40% of these employed with Micro, Small and Medium Enterprises (MSMEs).
  • The total number of vulnerable migrant workers could range from 115 million to 140 million.
• Impact of COVID-19 pandemic: Out of the total 122 million who lost their jobs in 2020, 75% (92 million) jobs, were lost in the informal sector.- The Inequality Virus Report, Oxfam.

Associated concerns:

• Lack of coverage: present draft rules apply to manufacturing firms with over 299 workers, leaving 71% of manufacturing companies out of its purview.
• Social Security Ignored: under the draft rules of the Code on Social Security.
  • Mandatory registration (with Aadhaar cards) on the Shram Suvidha Portal: may lead to Aadhar- driven exclusion and procedural challenges to workers due to their lack of information.
  • Regular upgradation of information presents a challenge to workers, especially for migrant and seasonal labour force.
  • Vague provisions: for instance, whether a migrant worker registered in his/her home state will be able to access social security benefits in other states where s/he is currently employed.
• Risk of rising inequality: due to growing informal nature of the workforce and the lack of the state’s accountability which may lead to-
  • Several vulnerabilities: like violations of human and labour rights, the dignity of livelihood, unsafe and unregulated working conditions and lower wages, etc.
  • The National Human Rights Commission recorded over 2,582 cases of human rights violation as early as April 2020.

Conclusion: In order to bridge the inequality gap, Labour codes should be made and implemented, keeping in mind the realities of the informal sector workers.