Daily Current Affairs – 20th February, 2016

Daily Current Affairs – 20th February, 2016

Labour in the 21st century

  • In spite of labour laws been widely studied for almost a decade and various recommendations to re-invent/evolve labour laws in the current leg of globalization, the issues pertaining to welfare of labour and flexibility of the firms to grow in sync with market conditions for better industrial relations, persists even today.
  • There have been recommendations by the government to reform labour laws in India by highlighting the need for flexibility in Indian labour laws that would give appropriate flexibility to the industry that is essential to compete in international markets.
  • But the overall attitude has mainly been towards skill enhancement and focus on flexible labour markets rather than assessment of
    • Proper enforcement of the laws
    • Situation of different categories of employers
    • Coverage of the social protection system

Three main labour lawsMajor point of debate

  1. Industrial Disputes Act (1947),
  2. Contract Labour Act (1970)
  3. Trade Union Act (1926)


  • Under Article 246 of the Indian constitution, issues related to labour and labour welfare come under List –III that is the Concurrent List
  • Exceptional matters related to labour and safety in mines and oilfields and industrial disputes concerning union employees come under Central List
  • In all there are 47 central labour laws and 200 state labour laws


India’s ‘labour problem’

Out of the eight core ILO Conventions against forced labour (slavery)—India refuses to ratify:

  1. C87 (Freedom of Association and Protection of the Right to Organise Convention);
  2. C98 (the Right to Organise and Collective Bargaining Convention);
  3. C138 (Minimum Age Convention)
  4. C182 (Worst Forms of Child Labour Convention)
  5. C131, or the Minimum Wage Fixing Convention

The Annual Global Rights Index (by the International Trade Union Confederation (ITUC)—

  • Rates 141 countries on 97 indicators derived from ILO standards with rating being on a scale of 1 to 5-plus, based on the degree of respect accorded to workers’ rights
  • 2015:India had a rating of 5, the second-worst category, thereby denoting “no guarantee of rights”

Concerns shouting for Attention

FICCI (Federation of Indian Chambers of Commerce and Industry) and AIOE (All India Organisation of Employers)—

  • Pointed out that India’s obsession with an archaic labour policy… is keeping investors away, hindering employment growth and making Indian enterprises uncompetitive
  • It is the multiplicity (44 Central and 100-odd at the State-level) of labour laws that is pushing workers to the informal sector, as companies seek “to circumvent the rigorous labour policies”

ILO—“labour market flexibility is as high as 93 per cent in India”, meaning that 93 per cent of India’s workforce anyway do not enjoy the protection of India’s 144 labour laws

Industry’s solution to the labour problem: Dilution of these laws so that the mass of informal workers can be employed formally, but without legal protections

Note: There is no nationwide law that recognizes trade union and also there is no compulsion for the employers to enter into a collective bargaining so even though there is a right to form an association or form a trade union, it is not mandatory for an employer to recognize it (Anant et al, 2006)

CTUOs& their display of strength—Mere Tokenism?


  • In a globalised Indian economy, the centre of gravity has shifted from manufacturing to services
  • Even in manufacturing, the advent of global supply chains has meant a mass informalisation of employment as multinational enterprises break up the production process and sub-contract to suppliers in different parts of the world


The fatal flaws—CTUOs’ Weaknesses

Political party affiliation: Of the Big Five unions, with a combined claimed membership of over 79 million with the Party affiliations entailing three things:

  • a restriction of the CTUO’s ability to expand, as it will put off those who do not like its parent party;
  • Party interests often trump union/labour interests;
  • Disunity between the differently-affiliated unions

Leadership: Marked by the “bureaucratic mentality” of a labour aristocracy; prefer policy analysis to on-ground organising and have failed to extend their reach to the growing mass of informal workers

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