THE BJP led NDA government at the centre has initiated a hectic move to amend several important labour laws in favour of the employers, soon after coming to power. Several state governments have also initiated such measures. This was apprehended as the corporates who have made huge investment during the elections to see this government installed at the centre would leave no stone unturned to ensure hefty returns on their investment.

The essence of these amendments to the labour laws, both by the central as well as the BJP led state government in Rajasthan is to empower the employers to retrench/ lay off workers or declare closure/ shut down at will and resort to mass scale contractorisation. These measures would push more than seventy percent of industrial establishments and the workers employed in them out of the purview of almost all the labour laws. The employers will be empowered to intensify exploitation.

LABOUR LAWS –MORE VIOLATED

THAN IMPLEMENTED

The labour laws in our country are more violated than implemented. More than sixty per cent of country’s workforce in the organised sector are denied even basic statutory benefits like minimum wages, PF and ESI. In total violation of the Contract Labour (Regulation & Abolition) Act, contract workers under various nomenclatures are being deployed in permanent, perennial and continuous jobs. The public sector undertakings and government establishments are no exception. More than 50% workers in public sector units and more than 70% in the private sector are contract workers. Other labour laws pertaining to working hours, overtime work, safety at workplace etc are also being flagrantly violated. 12 hours’ work without overtime wages has become the norm in many establishments. Wherever extra remuneration is paid for extra work beyond eight hours, it is much below the statutory double the rate of wages.

The entire burden of the economic crisis is being passed on to the workers. Closure, lay-off, shut-down have become widespread. However, majority of them are not officially reported. Most of these closures/shut-down and resultant retrenchment including in several middle and large enterprises including MNCs like Maruti-Sujuki in Haryana, Nokia, Foxconn, in Tamilnadu, Jessop, Hind Motor, number of Jute Mills and Tea Gardens in West Bengal, etc are illegal. But they enjoy the blessings and patronage of most of the state governments and the central government. In fact, the neoliberal regime has unleashed a jungle raj at the workplaces all over the country with suppression of labour becoming an integral part of the process.  

Under the directions of the government, both at the centre and in most of the states with rare exceptions, the enforcement machinery has been patronising such mass scale violation of labour laws. Inspection of the workplaces by the labour departments has practically been done away with. In most of the states, prior permission from the highest levels of the government is required even for inspection of workplaces by the labour department. And such permission is rarely given. As a result, practically a ban has been imposed through internal order (which does not have legal sanction) on routine and regular inspection of workplaces, thereby encouraging the employers to do whatever they like with the labour. Today, more than ninety per cent of the disputes between the employers and workers throughout the country pertains to only implementation of labour laws and nothing else. It is obnoxious that in a so called civilized society workers and their unions are compelled to agitate for implementation of laws passed by the Parliament facing victimisation both by employers and the government administration. The state machinery is being used to curb and suppress trade unions to make such state sponsored violation of labour laws free from any hurdles. In addition, forming and registering trade unions is being made more difficult. Thousands of applications for registration of trade unions are gathering dust in the labour departments in almost all the states, in brazen violation of Trade Union Act. Those in administration who are responsible for enforcement of laws are made to practically sponsor and patronise violation of laws making them totally subservient to interests of capital.

During the last three decades of neoliberal policy regime, this process of inhuman loot and plunder of the working people became aggravated. This becomes glaringly visible from the very fact that the wages’ share in net value added in manufacturing sector has been continuously declining from around 30% in late eighties to around 20% in mid nineties to only 9.5% in 2010. During the corresponding period, share of profit in net value added has continuously increased from less than 20% in late eighties to around 60% in 2010. During the same period, labour productivity has increased manifold and also the growth of GDP remained well above 5% on the average with the growth rate of manufacturing sector above 10%. As per the Annual Report (2012) of the labour ministry, the labour productivity in India measured in terms of GDP per person employed per hour is 4.17 US$, ie,  around Rs 250.20 per hour or Rs 2000 per day. If we compare this figure with the average of the statutory minimum wage level per day prevalent in various states/sector, the intensity of the loot on working people stands exposed. This was mainly achieved through consistent encouragement and empowerment to the employers to violate almost all labour laws with impunity.  

It is in such a horrible situation that the BJP led NDA government is taking measures to amend the labour laws in an attempt to overhaul the laws altogether in favour of the employers class.

AMENDMENT OF LAWS

IN RAJASTHAN

The Rajasthan state government is being utilised as a laboratory in the project of overhauling labour laws in favour of employers. It has already amended the Industrial Disputes Act, Factories Act and Contract Labour (Regulation & Abolition) Act incorporating atrocious anti-worker provisions by bringing the amendment bills and getting them passed on the same day on 1^st August 2014 despite vociferous opposition from all trade unions including those having allegiance to ruling party.

The amendments in Rajasthan Industrial Disputes Act empowers the employers to retrench workers without prior permission of the government in all establishments employing up to 300 workers; it also denies trade unions in any establishment to represent the grievances/demands of the workers unless they have at least 30% membership among the workers of the concerned establishment. Moreover almost all protective clauses on contract labour, particularly the responsibility of the principal employer, have been deleted. The definition of ‘go slow’ has been widened enabling the employer to attribute any failure in production or operation as a failure of the workers.  These changes will thus place workers in overwhelming majority of the industrial establishments in the state at the mercy of the employers, robbing them of the rights achieved through immense sacrifices and struggles over decades.

The amended Factories Act increases the threshold for coverage from 20 workers to 40 for factories operating without power, and from 10 to 20 for those operating with power. Moreover the Act also specifies that courts cannot take cognisance of complaints of violation of law against the employer without written permission from the state government. Punishment for violation of labour law has also been relaxed. These changes will lead to pushing out a large number of factories and workers out of the coverage of almost all basic labour laws.

The amendments to Contract Labour (Regulation & Abolition) Act removes all contractors employing up to 49 workers out of the purview of the coverage of the Act throwing almost the entire mass of contract workers out of coverage of almost all labour laws. The employers are thus encouraged to convert the entire workforce in any establishment into contract workers.

The amendment to Apprenticeship Act is aimed at transferring almost all authority to the State Apprenticeship Council under state government from the Central Council to facilitate flexibility in application and enforcement. The basic purpose of the Act on practical shop floor level training of the apprentices has been compromised through provision of outsourcing of the training cost, part of which will be borne by the government. The amendment opens the doors wide for the employers to replace regular workers by apprentices in the workplaces cannot. 

These amendments of labour laws by the BJP led government in Rajasthan are aimed at establishing a jungle raj in workplaces giving the capitalist class complete freedom to loot and exploit the workers. In fact, Rajasthan has a very bad record in the enforcement of labour laws with the numerous complaints of violation of all labour laws pertaining to minimum wages, contract labour, PF, ESI, working hours, unlawful retrenchment etc piling for years without any redress in almost all the industrial areas in the state. These amendments of the state government are designed to legitimise or legalise all those violations by the employers’ class. 7252 factories employing less than 300 workers each, out of total 7622 factories in Rajasthan will now come under the ‘hire &fire’ regime. All the contract workers numbering more than two lakh will be thrown out of the coverage of all labour laws including Contract Labour (R&A) Act and at least 70 per cent factories and their workers will go out of coverage of Factories Act.    

MOVES INITIATED BY

THE CENTRAL GOVERNMENT

This exercise of the BJP government in Rajasthan in the service of the employers class, both domestic and foreign, is an indication of the type of onslaughts that are going to be made on the working class throughout the country in the days to come. Already such move is reported to be afoot in respect of a number of labour laws.

From June 5, 2014 onwards, the central labour ministry posted in its website, the proposals to amend the Factories Act, Minimum Wages Act and the Apprenticeship Act.  Thereafter, in the first week of August 2014, after the completion of exercise in Rajasthan assembly by the BJP government there, the central government also introduced the Factories (Amendment) Bill 2014, The Apprenticeship (Amendment) Bill 2014 in Lok Sabha and brought back in business the Labour Laws (Exemption from Furnishing Returns and Maintaining of Registers by Certain Establishments) Amendment Bill 2011 in Rajya Sabha.

These proposals have the following implications:

FACTORIES

ACT

Through amendment of section 56 of the Factories Act, the spread-over of time in which a worker can be detained for getting his work for eight hours including lunch recess, is proposed to be increased from 10.5 hours to 12 hours if the state government is so satisfied. As per the existing provision, spread over time can be increased from 10.5 hrs to 12 hrs only with the written permission of the Chief Inspector of factories, giving specific reasons for such increase. This would naturally require due inspection process involving all concerned. Following the amendment, the state government can straightway increase the spread over time to 12 hrs without the concurrence of the Inspector. The provision for ascertaining actual and technical necessity through inspection for increasing the spread over time to 12 hrs is replaced by ‘satisfaction of the state government’ or in other words, the bureaucracy, providing a longer rope to the employers for manipulation and manoeuvres. It would allow employers to detain the workers longer hours in the workplace without any extra remuneration and will add to their harassment.

Through amendment of sections 64 and 65, the existing limitation on overtime work of 50 hours per quarter has been straightway increased to 100 hours; through provision of exemptions by state government through the Chief Inspector such overtime work can be extended to 125 hours in so called ‘public interest’. This amendment along with the enhancement of spread-over period will lead to harassment of workers and make way for victimisation. In addition, enhancement of overtime work will directly affect employment generation as well, enabling the employers to economise in labour cost. Through amendment of section 66, restriction and regulation on deployment of woman workers in night shift is being sought to be liberalised and relaxed. 

And the most retrograde of all above, is that the Amendment Bill proposes to empower the state governments to freely change the definition of a factory, rather the threshold level employment of the factory to be brought under the coverage of Factories Act subject to a ceiling of forty. The whole design is to legitimise through backdoor the retrograde changes made by the Rajasthan government in the Factories Act. Given the character of most of the state governments in the country, such a provision of liberal change, rather enhancement of the threshold level of employment for the purpose of definition of factory to be covered by the Factories Act will provoke a kind of  ugly competition between the state governments to appease the capitalist lobby by pushing a majority section of the workers out of the coverage of the labour laws.   

MINIMUM WAGES

ACT

The amendment proposed to the Minimum Wages Act ignored the consensus recommendation of the 43^rd Indian Labour Conference in formulating minimum wages based on the recommendation of the 15^th Indian Labour Conference, along with the direction of Supreme Court in the Raptakos Brett case. It provides for National Floor Level Minimum Wages without stipulating the criteria thereby leaving it to arbitrary decisions of government or governments.

Secondly, a central legislation must make it obligatory for all state governments to provide for variable dearness allowance component to be revised every six months based on the consumer price index. In many states, this does not exist. This essential requirement cannot be replaced by merely the provision of review of minimum wages within a period not exceeding five years as proposed by the Ministry. Amendments proposed by Union Labour Ministry ignored this aspect altogether. 

The amendment proposed provides for applicability of the minimum wage for unskilled workers in scheduled employment (both in part-I and part II of the schedules) for all workers, irrespective of their skill level, in the employments/occupations not mentioned in any of the schedule. This is totally unjust and is designed to serve the employers’ interests at the cost of the workers.

Simultaneously, the proposed amendment arbitrarily empowers the appropriate governments in altering or even deleting any particular items from the schedules of employment. This arbitrary power to delete any particular employment from the schedule is certainly going to lead to an increase in unscheduled employment subjecting concerned workers to the wages of unskilled workers irrespective of their skill level. 

APPRENTICESHIP

ACT

The amendment proposed to the Apprenticeship Act 1961 mainly aims at rescuing the offender employers from the penalty of imprisonment by deleting the concerned section and replacing it by a fine of Rs 500. Employers are given wide flexibility to decide new trades for apprentices. The definition of workers under Apprenticeship Act is being changed to include contract workers, casual workers and daily rated workers to decide the number of apprentices as a ratio (minimum 30%) of total workers in the establishment. This, along with the enhanced flexibility allowed to the employer, may encourage replacement of the contract/casual/temporary workers and even regular workers with comparatively lower paid apprentices (minimum 70% of the minimum wage) in production work, thereby reducing the overall labour cost. The ground reality is that in numerous establishments including companies like Maruti-Suzuki, the practice of using the apprentices/trainees in regular production jobs, year after year is widely prevalent.  

LABOUR LAWS

AMENDMENT BILL 2011

The Labour Laws (Exemption from Furnishing Returns and Maintaining of Registers by Certain Establishments) Amendment Bill 2011 was first introduced by the then UPA government in 2005 providing for relaxing obligation of employers on furnishing returns and maintaining employment registers etc for establishments employing up to 500 and also providing for enhancement of penalty for employers for violating 9 major labour laws. The Parliamentary Standing Committee on Labour unanimously rejected the Bill and submitted its recommendation accordingly. Then the government withdrew the Bill in March 2011 and simultaneously reintroduced it with same title but new content. The present Bill did not have any provision for enhanced penalty for the employers. The Bill proposes raising of the threshold level employment from existing 19 to 40 for any establishment to be treated as small establishment. In the name of simplifying the forms of returns and registers, it virtually exempts these establishments from maintaining such registers and filing returns under 16 major labour laws such as Factories Act, Payment of Wages Act, Minimum Wages Act, The weekly Holidays Act, Plantation Labour Act, Contract Labour(R&A) Act, Building & Other Construction Workers Act etc, embracing almost workers of all sectors. With the advanced technology available today, there are many establishments with large capital investment and high levels of turnover and profit but employing only 20 or so workers. As per an estimate more than 72 per cent factories in the country now will find it much easier to violate all those 16 labour laws with impunity subjecting the workers into more fierce exploitation.

TRADE UNIONS DENOUNCE

SUCH UNILATERAL MOVES

All the Central Trade Unions, jointly and separately conveyed to the Union Labour Minister their opposition to any unilateral moves to amend the labour laws. They strongly demanded that the Labour Ministry must discuss all the above proposals thoroughly with the Central Trade Unions before finalising the amendment proposals. They also urged upon the Labour Minister to take immediate legislative action on the consensus recommendations of the 43^rd, 44^th and 45^th Indian Labour Conferences on same wage and benefits for same work to the contract workers as the regular workers, formulation of Minimum Wage as per formula drawn by 15^th Labour Conference together with Supreme Court Directive in Raptakos Brett case and recognition of the anganwadi workers and helpers, ASHAs, mid day meal workers, teaching and non teaching staff of the National Child Labour Project, Sarva Siksha Abhiyan and the other central government schemes as workers/ employees with attendant benefit of minimum wages and social security benefits.

However, it is reported that the government is intent to get the amendments to various labour laws including Factories Act, Contract Labour (Regulation and Abolition) Act and Apprenticeship Act in addition to the Labour Laws (Exemption from Furnishing Returns and Maintenance of Registers in Certain Establishments) Amendment Bill that has already been introduced during the UPA regime, passed in this session of Parliament. This creates valid apprehensions that the Modi government intends to follow the Rajasthan government pattern to amend the labour laws.

A CAMPAIGN OF

LIES UNLEASHED

What are the implications for the workers if the central legislations are amended in the Rajasthan way?

Out of total 175710 factories in the country, employing 13429956 workers, of which 3610056 are contract workers, (as per Report of Annual Survey of Industries 2011-12, published in March 2014), 125301 factories, i.e., 71.31% factories employing less than 50 workers would mostly go out of the coverage of Factories Act owing to increase in threshold limit of employment from 20 to 40.

Owing to enhancement of employment level from 100 to 300 for the establishments requiring no prior permission of government for retrenchment/lay-off etc in Industrial Disputes Act, more than 80 per cent of the factories and their workers will come under ‘hire & fire’ regime of the employers. Almost all contract workers in manufacturing sector will be subjected to ‘hire & fire’.

As a result of the amendment to Contract Labour Act enhancing the employment under any contractor from 20 to 50 workers, the entire section of contract workers in private sector establishments and large section of contract workers even in PSUs will be denied the coverage of almost all labour laws, providing a free hand for the employers in more than 80 per cent of the factory establishments. If service sector is taken into consideration, more than 90 per cent of the workforce will be under the complete tyranny of the employers’ class.    

But, the irony is that such inhuman attacks on the working people of the country is sought to be justified by unleashing a campaign of total lies. It is being claimed that these changes would attract investment, thereby increasing growth and also employment generation. In other words, it is argued that such total liberty to retrench workers will encourage the employers to employ more leading to increased employment generation.

But reality is just the opposite. Despite widespread non implementation and violation of labour laws in almost all the states during last three decades, employment growth rate in organised sector continued to remain negligible and in a total mismatch with the GDP growth rates. The 11^th Plan period-i.e., 2005-2010, witnessed the highest growth in GDP rate at 8.5% annually on the average. But employment growth rate collapsed to mere 0.7% (from 2.7% during 2000-2005 when GDP growth rate was much lower).

In fact, during entire three decades under neoliberal policy regime, the productivity of labour in organised sector has consistently increased but their share as wages has gone down consistently in real terms. Besides, regular employment in organised sector consistently declined and its share in the unorganised sector has been consistently increasing reaching almost 90 per cent of the total workforce in the country. But more alarming is that, in the organised sector itself, the number of permanent workers drastically declined; they were more than replaced by contract and temporary workers with identical service condition of unorganised sector workers. This means, the employers in the organised sector sought to further reduce their labour cost by increasingly shifting to informal low-paid employment taking advantage of the unemployment among skilled and young workforce in the country in order to retain and also increase their level of profit even in the midst of economic slowdown. But there is a limit to manage the slowdown and economic gloom when impoverishment among the mass of populace has widened and deepened. So despite a low-wage scenario throughout the country, with the share of workers with working conditions like unorganised sector reaching almost 70% in the private organised manufacturing sector, the manufacturing sector’s growth started dipping since the last couple of years reaching a negative figure in the last quarter of the last financial year. This phenomenon explodes the myth that ‘hire & fire’ regime and suppression of labour will lead to increase in employment.

This is the reality, not only in India. The entire world is witnessing the same phenomenon. The World Employment Report published by ILO had observed that the empirical evidences of employment scenario shows that the countries with higher labour flexibility do not have any brighter performance in employment generation. The campaign of lies justifying the move for retrograde pro-employer amendments in labour laws unleashed by the advocates of neoliberal regime only exposes their total servility to the interests of corporate/big business, both domestic and foreign.

UNITED COMBAT

NEED OF THE HOUR

Such crime on the working people of the country who create GDP, generate revenue for the public exchequer and profits for the employers, being perpetrated by the corporate servile government must be combated resolutely. The lie campaign by the stooges of the capitalist lobby in governance and their politics must be thoroughly exposed. All in united resistance has to be built up in every workplace of the country.