Labour reforms without good governance will not be of much use
Such reforms must not only ease hiring and firing rules, but also ensure a living wage and safe conditions for work
- Published 16.07.19, 9:40 AM
- Updated 16.07.19, 9:42 AM
- 2 mins read
Labour market reforms have been on the policy agenda for a long time in India. The essence of reforms is that it is supposed to ease hiring and firing rules, with less government intervention in employment practices. However, reforms also need to take care of an assured living wage and safe conditions for work. Labour legislation has been quite complicated and employers have to comply with a large number of separate enactments. Keeping these issues in mind, the current government has been engaged in revising the different laws into four sets of labour codes. The first bill is ready to be placed in Parliament, and primarily deals with minimum wages that are binding. A second bill on occupational safety, health and working conditions has also been approved by the cabinet. These measures are supposed to benefit at least 40 crore workers. The law requiring a binding minimum wage is certainly laudable and will benefit workers if implemented well. However, contrary to the expert committee’s suggestion of Rs 375 per worker per day, the cabinet has approved a rate of Rs 178 which is only two rupees more than the existing, non-binding prescription. On the occupational safety code, there are precautions to cover all workers in establishments with 10 or more employees. The safety and health standards will be applicable to all trades and activities. For mines and docks, these will be applicable even if there is only one worker. In a similar fashion, there are explicit rules framed for women working night shifts. Women can be put on the night shift roster only with their consent. The prescriptions look impressive on paper.
There are lots of activities where there are less than 10 workers in an establishment, especially in the informal sector. They are not covered. There are questions of governance too. In a recent accident in Pune, 15 people, including construction workers, died when a wall collapsed on the shanties where they lived. Although the government of Maharashtra gave their families ad hoc compensation, their next of kin were unable to claim any compensation that would be theirs by law if only the government had actually registered them as construction workers. This is negligence of the highest order, especially when it is claimed that Rs 28,000 crore of money for this purpose lies unutilized in the government’s coffers. Sectoral reforms and new legislations, without good governance, are not of much use. It is the latter that the nation often lacks.