Towards Greater Precarity

Context: Government's response to migrants' plight, economic crisis, has been to unilaterally bring changes in labour laws. But industrial prosperity cannot be built on a race to the bottom for workers.

Issues with the unorganised/circular/migrant workers

• Impact of Lockdown: has forced the migrants on the road and highways in distress of having lost jobs, income and shelter, with no recourse to social security.
• Lack of employment security: Between 2004-05 and 2017-18, the share of salaried workers outside agriculture without any written contract increased from 60% to 71%.
• Rising casual workers: the share of such workers increasing from 27%  to 45% over the period.

• The share of the circular migrants in all the precarious jobs outside of agriculture increased over this period from 47% to 57%.

• Rising Contract Labour: Many of the wage jobs in the organised sector came through contractors 

• In organised manufacturing, the reported share of contract labour increased from 13% in 1995-06 to 36% in 2017-18. 

• Informality contributes to inequality: 

• According to the National Commission for Enterprises in the Unorganised Sector (NCEUS), informality contributes to inequality and to conditions which make sustainable growth impossible, and economic recovery more difficult. 
• It also creates conditions in which employers under-invest in workers' capacities, and workers are not invested in a company's future — leading to low productivity and lack of competitiveness. 

Government's Response: The following codes has been introduced as the cornerstone of the emerging employment structure.

1. Code on Wages
2. Code on the Industrial Relations
3. Code on Social Security
4. Code on Occupational Safety, Health and Working Conditions.

Criticism of the steps taken by the Government of India (GoI)

• Introduction of "fixed-term" worker category: In 2018, GoI amended the Standing Orders on Employment Act.

• It creates a permanent cadre of temporary workers, with no prospects of career growth and job security, will, after codification, be the cornerstone of the emerging employment structure. 

• Issues with the Amended Bills: These changes may appeal to myopic interests which believe that industrial prosperity can be built on a race to the bottom for workers.

• Non-consultative: The changes were neither recommended by the Parliamentary Standing Committee nor discussed in tri-partite forums with workers and employers.
• Rationalisation of fixed-term employment has not stopped the Codes from further liberalising employment of contract labour 
• Now the regulations are applicable only to an establishment employing 50 or more workers as against 20 earlier.
• Dilution of key provisions of inter-state migrant workers: which are now made applicable only to establishments employing ten or more such workers, compared to five earlier.
• Raised the applicability of the Standing Orders: which regulate the categorisation as well as the terms of employment of workers in establishments, has been raised from 100 to 300 workers. 
• Doubled the threshold for factories: from 10 to 20 workers— thereby eliminating a large number of important regulatory provisions for the smaller factories. 
• More leeway to the government in exempting establishments: from the applicability of a whole range of provisions in the Code. 
• Dilution of inspection provisions: which are no longer complaints based.
• Made legal industrial action, virtually impossible: Less than one in five employees are currently represented by the unions even in the formal sector.

Conclusion: Balancing of interests (as recommended by the NCEUS) pushes the government to invest in the long-term future of workers and reversing the tide of precarity.