Adarsh Kumar & Aryan Bhat
INTRODUCTION
The ongoing COVID-19 contagion has had a disproportionate impact on the economically vulnerable migrant workers which has worsened their pre-existing financial vulnerabilities and pushed them to the brink of penury. The financial unsoundness, relegated social standing, coupled with the state apathy has triggered a large-scale humanitarian crisis as the vast underclass of workers have been compelled to either walk to their native homelands which has led to accidental deaths in many instances. The crisis, as a matter of fact, has inadvertently exposed the structural fissures in our existing labour laws and the government’s egregious response towards the vulnerable and unorganized labour workforce.
The recent dilution in labour laws, a move the states deemed imperative in order to uplift the economy amid the virus-induced lockdown, has added more salt to the collective misery of migrant workers. The piece argues that such suspension of labour laws is extremely problematic and amounts to forced labour.
The authors in this piece also highlight that the labour laws in India are obsolete and bureaucratic, which has made ensuring the welfare of the working class too onerous for the employers. The solution, therefore, lies in relooking at the subsisting legislations to yield greater compliance by employers but not at the expense of fundamental rights of the labour class guaranteed by the Constitution of India.
THE LEGALITY OF THE STATE ORDINANCES
States like Punjab, Assam and Haryana recently issued ordinances to suspend provisions of the Factories Act, 1948 and the Industrial Disputes Act,1947. Invoking section 65(2) of the Factories Act, the state governments exempted industrial establishments from the applicability of sections 51 (weekly working hours), 52 (weekly holidays), 54 (daily hours), 55 (intervals for rest), 56 (spread over a period) of the said act. Notably, section 65(2) empowers state governments to exempt factories from complying with the impugned sections only to deal with “an exceptional press of work” i.e. to meet any situation where the factories have to cater to an unusually large volume of work. Invocation of the section to revive economic activity from scratch would be ultra vires the statute.
It is also well-known that given the economic recession in India, as demand has slowed, the industries cannot possibly have such exceptional press of work to deal with. Many others like Himachal Pradesh, Madhya Pradesh suspended the same provisions under section 5 of the act on the grounds of “public emergency” which potentially discharges employers from all their legal obligations except the prohibition of employment of young children. However, a public emergency has been very narrowly defined to include situations where the security of India is threatened by external or internal forces and hence cannot include health pandemics like COVID-19.
Madhya Pradesh also suspended the Industrial Disputes Act for newly set up units in the state. Gujarat, in fact, went many steps further by suspending all the labour laws except the Minimum Wages Act and Employee Compensation Act for the next 1,200 days. Therefore, suffice to say, such arbitrary orders by the state governments clearly amount to forced labour under article 23 of the Constitution of India.
In People’s Union of Democratic Rights v Union of India, the Supreme Court offered a broad and liberal interpretation of the phrase, “other similar forms of forced labour”. The court described “forced labour” as a work or service wherein a worker has involuntarily agreed to do a particular work solely due to a lack of alternatives or bargaining power with the employer. ‘Force’ is not merely applied to the worker by physical or external means but also by capitalising on her economic compulsions such as hunger, poverty and unemployment. In absence of such economic vulnerabilities, the worker would never accept to work for such long stretches of hours without any rest intervals or holidays provided or in a work environment where the employer, being exempted from his/her legal obligations, is free to terminate the employee on his will with the latter having no legal recourse to challenge such a wrongful termination. Making the employees work under such conditions legitimises their exploitation which undermines their basic human dignity and is thus, violative of Article 21.
Additionally, the suspension of the Industrial Disputes Act and the Trade Unions Act, 1926 by Gujarat and Madhya Pradesh now makes the employees incapable of engaging in any mechanism for settlement of any industrial dispute over their terms of employment, termination, retrenchment etc since it suspends the working of the Industrial Tribunals and Labour Courts established under the act and bans the formation of trade unions. This contravenes Article 19(1)(a) and 19(1)(c) and since the grounds on which the impugned restriction is imposed does not even fall within any of the permissible ones under article 19(2) and 19(4), the ordinance does not pass the constitutional validity.
THE CASE FOR LABOUR REFORMS
There’s no doubt that labour reforms are the need of the hour in India. Most of our labour laws are inflexible and have failed to provide any financial insinuation to the working class against capitalist interests, as the ongoing pandemic has revealed. India’s labour laws are obsolete as most of the important ones were implemented either immediately before or after independence. Post the economic reforms of 1991, the laws reflect a bureaucratic mindset.[i]
For instance, under the Industrial Disputes Act, if an employer wishes to retrench an employee or shut down a lossmaking enterprise, he shall obtain the necessary permission of the appropriate government. Similarly, under the Trade Union Act,1926, minimum of seven employees are required to form a trade union. This is likely to result in multiple trade unions for the management to deal with, a problem which is aggravated in case of different demands by the trade unions, which even reduces the workers’ bargaining powers. The Act even allows leadership from outside the organisation, which makes them vulnerable to political influences.
However, as per the recommendations put forth by the 2nd National Commission on Labour, to restructure existing framework of labour laws to make it simplified and streamlined, the Government, in 2019, decided to consolidate 44 labour laws into four labour codes, namely- Code on Industrial Relations, Code on Social Security and Welfare, and Code on Occupational Safety, Health, and Working Conditions, and Code on Wages, of which the first three have been introduced in the Parliament.
While these codes seek to improve workers’ condition as it covers workers from all sectors, reduces the issue of regionalism, encourages the role of technology-driven in labour statistics, and imposing heavy amounts of monetary punishment in case of violations, these codes also have some serious shortcomings. As a matter of fact, these codes even do not take into account the social security systems which are designed for persons belonging to old age are structurally different from the poverty alleviation schemes.
Finally, many of India’s labour laws also entail their administration by the Labour Department which hires labour inspectors to ensure compliance by the companies. They are even empowered to collect fines in case of labour law violations. The companies generally find it very burdensome to maintain different registers under the laws and rather prefer to bribe the inspectors.[ii]
In the face of such rigidities, often businesses escape following the law which impacts the Indian economy negatively. A study conducted by Export-Import Bank found India’s per unit employment to be abysmally low given its labour-intensive economy. Indian firms hired, on an average only 78 workers as compared to China’s 191 or Indonesia’s 168. It listed the country’s inflexible labour laws as one of the obstacles that entrepreneurs face in scaling up their operations by cutting costs or by hiring more workers.
CONCLUSION
The authors, in this piece, have discussed how under the garb of ushering “reforms” to revive the economy from the lows of the COVID-19 pandemic, the ordinances so passed by the state governments are tantamount to legalised exploitation of the working class by trampling upon the many fundamental rights guaranteed to them by the constitution. While it is true that labour laws in India are no longer relevant to the socio-economic environment that prevails post the economic reforms of 1991, the modernisation of the laws shall not come at their expense. The objective of labour laws is to ameliorate the living standards of labourers and simultaneously promote economic growth. Hence, the lawmakers shall strive to strike a balance between the interests of the workers as well as the management to enable trust and harmony between both of them to give an impetus to our country’s stagnant
[i] Alakh N Sharma, Economic and Political Weekly, Vol no.41, No.21.
[ii] JS Sodhi, Indian Journal of Industrial Relations, Vol 50, No.1(July 2014), pp111.
Adarsh Kumar & Aryan Bhat, First Year students in B.A.LL.B. (Hons.) at National Law University, Delhi.
Picture Credits: The Patriot Newspaper
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