September 17, 2023

Chipping Off Workers’ Rights

R Arun Kumar

THE joint declaration adopted at the recently concluded G-20 Summit in Delhi had an interesting paragraph. (Spoiler alert: This paragraph is not about Ukraine, climate change or economy per se, which were dealt elsewhere in this issue, but something else). This particular paragraph deals with ‘preparing for the future of work’. Given that the G-20 primarily focuses on economic issues, it is only natural for a paragraph of this nature to find a place in the declaration. However, the wording and the noble intentions expressed in this paragraph do not suit majority of the countries that had signed the declaration, India, that is Bharat, included.

Paragraph 20 of the declaration starts with a promise of ‘promoting decent work’ and ‘ensuring inclusive protection policies for all’.  It explains the commitment of the signatories through nine points. The eighth point is particularly noteworthy: ‘Ensure adequate social protection and decent working conditions for gig and platform workers’. In our country, for instance, media reports indicate that varied sections of gig and platform workers are fighting for their basic rights. Instead of lending a sympathetic ear to their concerns and demands, the government(s) have tried to help the platforms and employers to terminate their contracts. When the workers protested, they were greeted with police brutality. The proverbial distance between the hand and mouth is too much to miss out as there is glaring disparity between rhetoric and action!

The G-20 and the attack on workers’ rights have certain commonalities. While the group emerged during the 2008 global economic crisis, the same economic crisis was used as a ruse to intensify the attacks on workers’ rights everywhere. The G-20 basically was concerned about protecting the interests of the ruling classes and international finance capital, which is naturally contradictory to the interests of the workers. Hence, to find such a paragraph in the declaration is undeniably intriguing.


Ruling classes around the world, driven by their relentless pursuit of making profits, are always eager to curtail workers’ rights and intensify their exploitation. Whenever they find themselves in crisis, they use the crisis to further burden the workers and protect their profits. This was seen when neoliberal policies gained steam throughout the world since the Pinochet years in Chile (late 1970s). The attack on unions and the rights won by the working class earlier through their collective struggles were attacked ruthlessly. The United Kingdom under Thatcher and the United States under the Reagan administration led the way. Later, many countries adopted similar policies, which resulted in weakening of trade unions and declining unionisation. This trend gained further momentum following the 2008 economic crisis.

The attack on the working class is often carried out under the guise of reform of labour laws. According to a World Bank study, between 2007 and 2017, a total of 99 countries embarked on labour regulation reforms. The study details the nature of these reforms. “The most common topics for reforms are: i) procedural requirements in case of contract termination, and changes in notification arrangements – 54 country cases; (ii) fixed-term contracts – 44 cases; (iii) severance payments – 35 cases; (iv) annual leave arrangements – 24 cases, and (v) working time arrangements – 10 cases of reforms.

Recent reforms in legislation have focused on ‘easing regulations’ to facilitate more contractual employment through a variety of contracts. They increased temporary forms of employment. According to OECD data, more than half of all jobs in the non-agricultural sectors of developing countries – over 900 million workers – are considered informal, and out of scope of labour regulations. Standard contracts only accounted for 59 per cent of contracts in 2014, down from 62 per cent in 2003. More than 48 per cent of women are employed as part time workers. Among youth aged between 15 and 24 years, nearly half of them are employed as part timers. After the implementation of austerity measures and accompanying labour law reforms, the probability of part time, temporary workers, becoming permanent has fallen. In the 28 member countries of the European Union (in 2016), on average, only 23 per cent of workers transitioned from temporary to permanent contracts.

From the workers’ perspective, fixed-term jobs are less secure and pay lower than average wages. By mid-2017, out of 190 countries, 123 countries (65 per cent) allowed fixed-term contracts for permanent tasks and also ensured that the duration of work is not regulated by labour law. In France, between 2000 and 2017, the number of declared fixed-term contracts with a duration of less than one month increased by 165 per cent, up from ‘around 1.5 million by quarter in 2000 to 3.5 million in 2017’. Contracts even exist for one day or less, with a renewal on a daily basis, and precarious forms of self-employment proliferated. The wages paid for such contract workers is much less than the minimum wage and due to the changes in the laws, this discriminatory payment cannot be challenged. For instance, for 19-year old worker hired under a formal apprenticeship contract, the minimum wage is 41 per cent for the first year, 49 per cent for the second year, and 65 per cent for the third year!

Many of the companies that employ workers are allowed to dismiss or walk-out of the contract without any penalty. Companies are citing ‘economic reasons’ (declining demand, shrinking markets, increasing competitiveness, etc) and are dismissing workers. Changes in employment protection legislation have also affected many of those with regular or permanent employment. The El Khomri Act of 2016 passed in France, simplified ‘dismissals for economic reasons’. The Act also allows for wage cuts and additional working hours when a firm faces economic difficulties. Such attacks on workers were further strengthened in subsequent legislations – the Macron Orders of 2017 and the Pénicaud Act of 2018. It is against such reforms of labour law that the workers in France protested, even facing brutal police repression. On top of all these reforms, Macron is continuing with his attack through changes in pensions or pension reforms.

The situation is more or less similar in many other countries in Europe. In Greece, the length of notice period is reduced, and severance payment reduced. In Italy, starting in 2012, the definition of unfair dismissal was revised and its consequences eased. There was substantial retrenchment in open-ended contracts. In Germany, the creation of four million additional jobs has been obtained by taking four million existing full-time jobs and transforming them into eight million part-time (or half-time) jobs. In UK, reforms since 2010 have shifted the pattern of labour market policies further towards more flexibility and less protection.  In 2008, there were approximately 143,000 zero-hour contract workers in the UK and by 2014 they had reached a staggering 700,000 or 2.3 per cent of total employment.

According to a study, labour market insecurity increased between 2007 and 2010 and was higher in 2013. During the austerity period, it increased the most in Greece (by 77 per cent), Italy (by 72 per cent) and the Netherlands (it doubled).

The present reform of labour laws witnessed in Europe was a progression from the policies of ‘flexicurity’ that were initiated from the early 2000s. Flexicurity is a term that had emerged to mean a mix of flexibility and security in employment relations. The ruling classes have ensured that in practice, it is mostly about flexibility and nothing about security for the workers. The concept of flexicurity is also in its essence political as the more unequal correlation of class forces are, the easier it becomes for the ruling classes to tilt the balance in favour of flexibility. This can be understood from the fact that there were three different governments in France, between 2000 and 2023 – Sarkozy (considered to be centre-right), Hollande (considered to be Left) and Macron (right). There existed no difference among all three of them in reforming labour laws to weaken unions, working class rights and strengthen the hands of the ruling classes.

Behind all these reforms, we find the guiding hand of the European Commission Bank (ECB), European Commission and the International Monetary Fund (IMF). In fact, a PhD dissertation submitted to Binghamton University conclusively establishes the role of IMF in ensuring the implementation of labour law reforms. For further evidence, we need not go any further than our immediate neighbour, Sri Lanka.

In Sri Lanka, the Ranil Wickremesighe government had agreed to the conditions imposed by IMF for a loan it had sanctioned to enable the country come out of its economic crisis. These reforms aim to amend the existing 13 labour legislations that had come into effect between 1935 and 2021. According to the JVP: “A careful review of the proposed changes reveal that they incorporate some changes that will contravene fundamental rights of workers, introduce an uneven playing field skewing it in favour of the employer and subject employees to, in some instances virtual servitude, impacting on their right to have a decent basic quality of personal life as a human being. The changes would also undermine certain specific labour rights accorded to women workers”.

The proposed reforms discourage the formation of trade unions by stipulating that now they need to have 100 persons to form a trade union, whereas the current law requires 7 persons. They intend to increase the working hours from the current 8 hours to 16 hours without any overtime payment. And all other reforms discussed above are also prescribed for Sri Lanka too.

Indian workers are already aware of the attacks that are taking place on their rights and existing laws. The reforms carried out in the name of labour codes are already extensively discussed and being opposed. The changes that are taking place in our country have to be viewed as part of the changes taking place throughout the world. Many countries in Latin America – Venezuela, Brazil, Chile – went through these reforms, struggles and succeeded in fighting them out and in the process, elected progressive governments. Some are still fighting, as in France, Greece, Portugal, UK, Sri Lanka etc.

The experiences gained by the workers through their struggles will certainly help us in fine tuning our strategies. After all, working class is a true international class and has got a world to win.

Post Script: The G-20 declaration lays great emphasis on freedom of opinion, expression and association. It also promises to fight all forms of discrimination and intolerance based on religion or belief! So Modiji, it is time to build class unity!

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