Make ‘Poor’ In India, Is That What The Amended Labour Law Is Aiming For?

Posted on May 11, 2015 in Politics

By Richa Priyanka

It came as no surprise that when reformed Labour Laws were proposed by the Ministry of Labour and Employment under the NDA led government, they were directed more towards the empowerment and autonomy of industrialists (most of who backed the party during elections), than for the protection of workers and labourers employed in the country.

indian labour
Photo Credit: Erik Parker

Whatever is happening now is part of a plan to erode the protection of the workers. It is a very deliberate strategy as the PM has promised foreign industrialists and big corporations in India that they should “Make In India” because that’ll offer them high-quality-low-cost labour. The only way to ensure low cost labour is to overwork and underpay them and ensure that they cannot unionize, that they cannot organize to protest,” says Kavita Krishnan, a political bureau member of CPI ML and the secretary of All India Progressive Women’s Association (AIPWA).

The new code received severe opposition by various trade unions all over the country like Rashtriya Swayamsewak Sangh’s Bhartiya Mazdoor Sangh, who also complained that they weren’t even consulted once during the formation of the Wages Bill. Further, parties such as AAP and Communist Party of India, led by the Trinamool Congress, have gone so far as to term the bill “anti-labour” and believe that the reform would demean the already poor status of workers in India.

Randomization Of Minimum Wages

In the absence of the National Floor Level Minimum Wage, as was set previously under the Minimum Wages Act 1948, the minimum wage set in different states will be arbitrary. Because of this, the states where the working class movements are weaker will be able to reduce the minimum wage to even below the minimum threshold. This is a severe problem in India, as there are a vast majority of workers available in the country who will be ready to work on extremely low rates because of the grasp of consuming poverty, and a lack of power to protest.

Laying-off Of Staff

The government claims that they will be able to create more jobs by laying off more workers, but, that is an absurd logic. “Hire and fire means that you will continuously be able to create disposable workers, you’ll dispose of one worker and create another worker. And you would claim to have given a job to both the workers, but, what you are doing actually is that you are rendering both of them insecure,” says Kavita.

Facilitators To Inspect Functioning

Instead of inspectors, or as the ministry had termed earlier as “social security officers”, facilitators will supply information and advice to employers and workers concerning the most effective means of complying with the provisions of the code. “The objective is to project a friendlier image to employers. The facilitators’ functions and powers are also proposed to be in keeping with this image,” said a person close to the development of the new code.

Difficulties For Trade Unions

It is going to be more difficult to form new trade unions as the new code suggests that a trade union shall have no more than two outside members while all the others should be company employees. Further, it does away with Section 23(2) of the Payment of Bonus Act 1965 which permits the trade unions to legally access audited accounts and balance sheets of employers. Rendering all the rights in the hands of the employers will threaten the security of the employees in India.

While most of these rectifications seem to be targeting the security of workers, some are required to make the law hassle-free for the industrialists. “India has long been criticized for its strict labour laws and burdensome business regulatory environment,” says the World Bank. Being the country with the largest population of under-utilized labour forces in the world, the stringent rules make it difficult for employers and industrialists to expand their businesses in a labour intensive fashion, while the industries keep growing in a capital intensive manner.

The reformed code is quite insufficient to strengthen Indian business standards, and might end up worsening the state of labour in the country.