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New Labour Laws Brought by Centre are Not 'Reforms' but 'Regression', Says Aruna Roy

Aruna Roy speaks to News18 on a subject close to her: labour rights and the recently promulgated labour laws. (File Photo)

Aruna Roy speaks to News18 on a subject close to her: labour rights and the recently promulgated labour laws. (File Photo)

Encouraging contract labour over full-time employment reduces workers' entitlements to compensation when being let go and their freedom of association to form unions to demand their rights, said social activist Aruna Roy.

Rupashree Nanda

Aruna Roy is one of those rare activists who has successfully straddled the multiple worlds of grassroots activism as well as policymaking. She is known for her pioneering work in bringing a 'rights based 'perspective in policy - her signature visible in legislation such as the Right to Information or MNREGA. She has won the Ramon Magsaysay Award and was a civil servant before she quit and founded the Mazdoor Kisan Shakti Sangathan along with Nikhil Dey and Shankar Singh. She was also a member of the Sonia Gandhi-led National Advisory Council when the UPA was in power.

She speaks to News18 on a subject close to her: labour rights and the recently promulgated labour laws.

Question: The BJP-led NDA government has viewed its recently promulgated labour laws as part of its ‘reforms’ process that is aimed at simplifying legislation on labour, improving the ease of doing business, as well as protecting workers' interest. What is your reading of the new legislation? Pro-reform? Pro-worker? Pro-industry?

All of us have seen what workers, particularly but not just migrant workers, have had to go through during the Covid-19 lockdown. What was needed even before the recent labour ‘reforms’ was to strengthen workers' rights and entitlements and to extend the coverage of statutory protections. It is, therefore, not just ironic but iron-hearted that the Centre and many of the state governments have diluted labour protections in the last few months. The simplification of complex labour laws that were won by common people’s struggles pre and post Independence is an insult to the worker.

Rather than ‘reforms’, the more appropriate word would be regression, or the stripping of rights. The dilution of the rights of workers, in order to privilege employers, is exploitation. The Labour Codes, as well as the ordinances passed during Covid lockdown by UP, Gujarat and other states, curb unionisation, dilute social security and worker protections and protests, among other restrictions on mobilisation and the freedom of the most vulnerable to claim their rights. Rather than pro-worker or pro-reform, this government is blatantly anti-worker, and favours the capitalist class. The policy decisions taken by this government since coming to power have increased privatisation as well as job insecurity. This government is pro-corporate and pro-business at the cost of the vulnerable, as is obvious when, in the guise of “promoting investment”, it cut corporate tax by almost 10 percentage points in 2019.

The incentive to increase production does not have to come at the cost of the workforce. Some of the implications of these codes included the erosion of collective bargaining, making it impossible to have a legal strike, a floor wage that is far below the figure suggested by experts, social security only for organised sector workers, and many others.

Question: The Industrial Relations Code Bill, 2020, has attracted maximum attention. It has sought to absorb three crucial labour laws – the Trade Unions Act, 1926, the Industrial Employment (Standing Orders) Act, 1946, and the Industrial Disputes (Central) Rules, 1957. How does the new code compare with the clutch of hitherto existing legislation? Do they empower the worker?

To “simplify” or dilute 40 central and over 100 state labour laws in 4 codes is problematic in itself. You ask if they empower the worker. The mischief begins in the definition of this term itself under the new code. If indeed the intention was reform and to bring the previous laws up-to-date, the government might have expanded the ambit of what it means to be a worker and include gig-economy workers, home-based workers, unorganised and informal sector workers, plantation workers, NREGA workers, etc. Rather the government has chosen to restrict the definition of a worker. For example, apprentices, who were earlier included in the definition of a worker, have now been dropped.

Similarly, the definition of ‘strike’ in the Industrial Relations Code has been widened to include ‘the concerted casual leave on a given day by fifty percent or more workers employed in an industry’, ​thereby further constraining workers’ abilities to organise and participate in peaceful strikes, which are a form of civil disobedience adopted by even Gandhi.

Also very dangerous are the changes being introduced to institutionalise contract work for jobs that are of permanent nature. Encouraging contract labour over full-time employment reduces workers' entitlements to compensation when being let go and their freedom of association to form unions to demand their rights.

The change in the labour laws, and particularly in the Industrial Relations Code, posits the employer against the worker/employee. Instead of helping the workers out of the crisis that Covid brought with it, almost every change in these laws not only disproportionately benefits the employer but also disadvantages the worker. Exploitation is the norm - the expectation - with little recourse for redressal.

Question: Defending the new Industrial Relations Code Bill, labour minister Santosh Gangwar has pointed out that there are sixteen states which have already raised the threshold from 100 to 300 for closure, layoff and retrenchment in firms without any government nod. States can also promulgate their own laws. The minister has also argued that raising the threshold will attract investments? Would you agree?

The poor worker is having to pay the price of the years of mismanagement of the economy of the current government.

​One must seek to understand why these states have made these changes in their labour policies. This is a classic example of doublespeak on the part of the central government. On the one hand, it claims to believe in federalism and, on the other hand, it actively seeks to constrain the options of state governments. It is common knowledge that the Centre has been withholding funds that rightly belong to the states. State governments are severely cash-strapped - all the more since the pandemic. The central government has now made their ability to borrow funds conditional to passing policies to improve 'ease of doing business'. In plain English, this means that unless the states diluted their labour laws, they were not going to get funds that are theirs in the first place. So, when the union labour minister points out that states have made these changes too, it is completely hypocritical since it is the Centre that has coerced the states into doing so.

Diluted labour laws will result in terrible working conditions. An exploited, exhausted, sickly and impoverished workforce, receiving a pittance for a long work day cannot continue to be productive. Workers are human beings with an equal claim to constitutional and fundamental rights. These changes bring back the dark ages where the people who were powerless were mere fodder for the rich.

Azim Premji elaborated in an article in the Economic Times how the interests of employers and workers should be more aligned in this time of crisis. He explained how the dilution of labour laws will not increase economic productivity. Rather, it is unethical, pits business and workers against one another, and will further create distress for the poor (Premji 2020, Economic Times).

Investors will be willing to put money into this economy when they see demand. And the way to generate demand is to put more disposable income into the hands of workers and expanding social security mechanisms like NREGA, pensions, etc. To argue that making changes on the supply side will supposedly improve ‘ease of doing business’ while being blind to the demand side is poor economics and a false argument. I could not disagree more with the minister.

Question: Code on Social Security Bill, 2020, seeks to subsume nine existing laws on the same. In India, there is hardly any social security net to speak of- especially for unorganised workers, the old and infirm, the physically challenged. You have worked hard on this, especially on old-age pensions. Do you think the new Code on Social Security Bill will be able to plug that gap?

You yourself have answered the question by saying that there is hardly any social security net to speak of in India. What we have been always demanding is universal social security protection for the entire workforce. Much of the workforce is unorganised and informal and the new code is silent about this vast majority of India’s working population.

For example, recommendations by the Standing Committee to modify the definition of ‘establishments’ to include ‘exchange of services with a provision of less than ten workers’ has been overlooked in the code. Similarly, for example, gig and platform workers in the new digital economy employed by the likes of Ola, Uber, Swiggy, etc, are not recognised as unorganised workers. After all that we saw in the initial days of the lockdown, there is no mention anywhere about the protections afforded to migrant workers through portability of some sort. Neither are there any details on how social security contributions would work for atypical employer-employee arrangements such as home-based work, self-employment, piece rate work, etc.

Far from plugging the gap, the new code makes it easier for employers to flout norms by reducing liability and penal action for doing so.

Question: The new Code on Social Security Bill will ensure that benefits of the Employees' Provident Fund Organisation can be availed by firms with more than 20 employees. The labour minister has also said that EPFO benefits will be extended to the self-employed. A Social Security Fund will cover 40 crore workers in the unorganised sector. Aren’t these measures progressive and will they not enhance social security of workers?

The SSBC mainly just consolidates existing legislation, while ignoring intra-state workers/migrant workers completely out of its ambit. Additionally, one of the main issues in the code is that now, 10 members of the National Social Security Board will be nominated by the central government, and only 5 members will be representatives of the state governments, indicating a centralisation of power when it comes to decision-making on social security of the unorganised sector workers.

Question: Let’s talk of the Occupational Safety, Health and Working Conditions Code Bill, 2020. This seeks to replace thirteen existing laws, including the Inter State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979. What is the most striking aspect of the new Occupational Safety Code Bill? What would you have wanted to see in it?

The code does not cover a majority of economic activity, such as agricultural labour (which is about half of India’s workers) as well as unorganised sectors such as small mines, hotels and eating places, machinery repairs, construction, brick kilns, power looms, fireworks, carpet manufacturing and those in the gig-economy. And, while there is mention of inter-state migrant workers, the code is silent on intra-state migrant workers, who are more in number than inter-state migrant workers. Further, the code differentiates being a contract worker and permanent worker performing the same job, which is unacceptable.

Question: The near total absence of any social security especially for unorganised migrant workers came to the fore most painfully during the lockdown- the long walk home of thousands of destitute migrants, the deaths and distress shocked many. Keeping that in mind, do you think, the proposed legislation will guarantee the basic fundamental rights of life and dignity?

Most new labour codes do not make a mention of intra-state migrant workers or their issues. One cannot ignore the link between the condition of migrant workers during the 50 plus days of lockdown and of states’ diluting labour laws. The circulatory labour force migrates because of poverty, unemployment, caste violence, landlessness, corporate land grabs and so on. Instead of providing systemic planned relief for the migrant workers, the government has furthered the hardships post a harsh lockdown by diluting labour laws.

Caught already between intersecting axes of oppression – caste, class, poverty, etc - discrimination against migrant labour, daily-wage workers, factory and informal sector workers, will be further entrenched by downgrading their rights.

Question:The Code on Wages, 2019, was the first in this series of the four labour code to be passed and subsumed The Minimum Wages Act, 1948, the Payment of Wages Act, 1936, the Payment of Bonus Act, 1965, and the Equal Remuneration Act, 1976. For the first time, it provides for a universal minimum wage across the country. What, according to you, are the gains of this and what are the losses?

The new wages code subsumes 4 important laws on safety and health, the working conditions code subsumes 13 laws and the social security code combines nine laws. The industrial relations code subsumes three existing laws – the Trade Unions Act, 1926, the Industrial Employment (Standing Orders ) Act, 1946 and Industrial Disputes Act, 1957.

All these were passed in the Lok Sabha and the Rajya Sabha while opposition parties had boycotted the houses.​

Question: There has been renewed attention on MNREGA in the time of the Covid-19 pandemic. More demand for work, guarantee of 150 days of work, extension of the same to urban areas. Do you feel the government has been able to exploit this rights-based programme to its fullest so as to give work to people and provide wages to their hands? What more can the government do to maximise the potential of MNREGA and absorb the severe and deepening economic distress?

To begin with, like you say, the government must increase the number of days of work under this Act and bring in a similar law for urban areas as well. What is further needed is to increase the wages being paid in NREGA. Since we are talking about the various labour codes, it might be pertinent to point out that the NREGA wages in numerous states are below even the statutory minimum wage. Additionally, all those demanding work under NREGA are not getting it. Tens of lakhs of households that have demanded work but have not yet been provided employment on account of insufficient funds, despite the increased budget, since the Centre has not been releasing funds on time.

Question: One final question regarding the manner in which these bills were passed in the Rajya Sabha with the complete boycott of the opposition. How do you see this playing out on the ground? Do you think the opposition parties will be successful in taking their concerns to the ground and make it count politically?

As someone in the media, I am sure you recognise that this government is very adept at controlling the public narrative to, as Noam Chomsky very rightly put it, ‘manufacture consent’. The primary tool employed by the ruling dispensation is that of distraction by constantly harping on issues that are not the basic concerns of a large majority of the Indian population. Further, they seek to polarise citizens by dividing the population into 'us and them'.

For the opposition parties, civil society and anybody in the media and otherwise concerned with the way things are happening in India, we must be wary of falling into the trap of reacting to the narrative being set by the government. We must most certainly oppose the various things being done that we do not agree with. But the government seeks to drain all our energies in such resistance. Therefore, to be effective, we also need to additionally and proactively speak up far more about the various other issues that genuinely matter to the poor in India and attempt to make it a part of the mainstream discourse that the government has to then react to.


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