Lockdown meltdown: governments dilute laws to favour the industry

With lockdown in force, governments across the globe are scrambling to implement steps they were unable to take due to opposition from people and political parties. India is no exception, and the government is blatantly diluting crucial laws in favour of the industry

SOON AFTER the world observed International Labour Day, India has scurried along a road that curtails the rights of its workers. On May 6, Uttar Pradesh increased the labourers’ working hours from eight to 10. The state announced it would suspend 35 of the 38 labour laws for next three years. The step, it said, would bring “on track” economic activity that has stopped due to the lockdown clamped after the COVID-19 pandemic outbreak. “New investment opportunities would need to be created along with fastening the business processes and productivity,” a statement issued by the state government said.

To formalise the process, the state has issued an ordinance. Once enforced, Uttar Pradesh would barely have a few functional labour laws. The Trade Unions Act, Industrial Disputes Act, Act on Occupational Safety and Health, Contract Labour (Regulation and Abolition) Rules, Interstate Migrant Workmen Act, Equal Remuneration Act and the Maternity Benefit Act would all be put on hold.

Madhya Pradesh, Gujarat and Assam have also hurriedly changed laws to loosen regulatory control on industry and tighten it for workers. Madhya Pradesh has amended the Shops and Establishments Act and allowed shops to function from 6 am to 12 in the night. People will now have to work 18 hours. The state has nullified its Industrial Relations Act 1960, a tool to settle disputes between employees and employers. For the next 1,000 days, new factories would be exempt from the Industrial Disputes Act, 1947, allowing employers to make labourers work as per their convenience. The labour department and the labour courts would no longer be required to intervene in actions taken by the industry. With the changed Industrial Employment (Permanent Order) Act, 1961, factories employing up to 100 workers would be exempt from its provisions. Factories with less than 50 workers can now be inspected only after permission from the labour commissioner.

Madhya Pradesh has also changed the Contract Labour Act, 1970. Now, business establishments need registration only if they have more than 50

workers, as against the earlier 20. Worse, employers would no longer be required to pay `80 per worker they now pay to the Madhya Pradesh Labour Welfare Board for workers’ security.

Gujarat has increased working hours from eight to 12. It has suspended key labour laws for 1,200 days. Assam and Tripura are ready to issue ordinances to change their labour laws. The Centre has said it is talking to other states as well to change their labour laws.

“All these measures are to empower employers so that they can hire and fire employees at will,” says Amarjeet Kaur, general secretary of All India Trade Union Congress. The worker cannot raise disputes. Business establishments with less than 50 workers would function without any control. With inspections withdrawn, the worker’s basic rights on wages, compensation and safety would become meaningless.

Criticising the government’s measures, India’s two leading industrialists—Azim Premji, chairperson of Wipro Ltd and Rajeev Bajaj, managing director of Bajaj Auto—have said it will only create mistrust between industry and labourers.

“People are already rattled by the pandemic, but the government is using lockdown to suppress the rights of workers and trade unions,” says Kaur. Calling the government’s actions antipeople and autocratic, the Centre of Trade Unions observed a nationwide protest on May 22. The Bharatiya Janata Party-affiliated Bharatiya Mazdoor Sangh, too, organised a protest on May 20.

FLAWED ARGUMENTS

“There is no doubt that lockdown has been catastrophic on industry. In fact, micro and small enterprises are facing an existential crisis and many units may not recover at all,” says Jayati Ghosh, economist and professor at Jawaharlal Nehru University. The government says it is changing labour laws to make conditions favourable for companies that wish to relocate from China to India. But labour is only the fourth constraint in India, shows a 2012 World Bank report titled The Role of Labour Market Regulation, Institution

INDIA’S TWO LEADING INDUSTRIALISTS—AZIM PREMJI AND RAJEEV BAJAJ—SAID THE CHANGES THAT STATE GOVERNMENTS HAVE MADE IN THEIR LAWS WILL ONLY CREATE MISTRUST BETWEEN INDUSTRY AND LABOURERS