ANY halfway decent story has its villain. Often it has a hero, but where the situation cannot produce a hero, there is always the martyr. The story that is currently being scripted has its villain, and its martyr. No marks for anticipating who is who. Anyway, that will become plain pretty soon.
In the beginning, there was the Industrial Revolution, colonization, the emergence of workers’ collectives, the consecration of the corporate entity, the birth of civilization and so on. In a more recent beginning, there was the Indian Constitution promulgated on 26 January 1950. The Constitution’s appointed task is to protect the weak against the strong. This, then, makes it incumbent on us to see where the dominant forces are located and who the relatively weak, and who the strong, are. There is internal evidence of how the Constitution understands it. Article 23, for instance, prohibits ‘traffic in human beings and begar and other similar forms of forced labour’. This is quickly followed up with Article 24 which aspires to protect children below the age of 14 from ‘work in any factory or mine or engaged in any other hazardous employment’.
Leave the chapter on fundamental rights behind, and move to the principles that are to guide the state in how to act, and ‘citizens, men and women equally’ are to ‘have the right to adequate means of livelihood’; the economic system is not to ‘result in the concentration of wealth and means of production to the common detriment’; the ‘health and strength of workers, men and women, and the tender age of children are not abused and that citizens are not forced by economic necessity to enter avocations unsuited to their age or strength’. The state is to act in ways that advance the ‘right to work’, provide ‘humane conditions of work’, maternity relief, a living wage, ‘conditions of work ensuring a decent standard of life and full enjoyment of leisure’.1
Over the next decades, the meagre fare of the Workmen’s Compensation Act 1923, the Trade Unions Act 1926, the Payment of Wages Act 1936, the Employment of Children Act 1938, the Factories Act 1948 was augmented with laws that were to ensure that workers in plantations and mines and those engaged in hazardous processes are not placed at risk, and that their living and working conditions do not drop into despairing depths. So there was the Employees State Insurance Act 1948, the Plantations Labour Act 1951, the Mines Act 1952, the Employees’ Provident Fund and Miscellaneous Provisions Act 1952, the Payment of Bonus Act 1965, the Payment of Gratuity Act 1972. The extraordinary vulnerabilities of contract labour and interstate migrant workers were acknowledged in the passage of laws in the seventies.2 Even a law that admitted to what by definition and effect is slavery – the Bonded Labour Act 1976 – was dared to be enacted. In the eighties, angst, prompted in fair measure by international disapprobation, brought the exploitation of child labour back to the surface.3
The Bhopal gas disaster shattered the silence on the exposure of the worker, and the resident in the vicinity, to hazards hidden away within the perimeters of factories. Till 1987, the worker had no right to ask and learn about the nature and extent of safety and potential hazard in the workplace, and the employer had no obligation to tell. If a worker spotted a safety lapse, there was nowhere to go with the anxiety about risk. The directors of companies who dictated policy had no responsibility for risk, or when risk precipitated into disaster. Hazardous waste could travel through populated, even populous regions, and be deposited in backyards anonymously, with no one the wiser. All this, and a good bit more, changed in the amendment to the Factories Act in 1987.4
Then, as the world moved into the nineties, something changed: and that is a euphemism. It began to dawn on the state that the constituency for which it was responsible was the corporation and that it is corporations which would best put countries on the global horizon. Multilateral financial agencies, of course, lent their services to moving on this agenda. So, because ‘human rights’ had skewered the ambitions of growth and wealth-generating development, a deliberate(d) shift was made from the human rights approach which had dominated the ’80s, to the ‘rights-based approach’; thus making a move from substantive rights to procedural rights. There would be the right to be informed and to participation, but that this was likely to be a prelude to diluting the human right to life, and the rights attached to land or to livelihood, was muted.
Then, there was ‘structural adjustment’, where economies and systems had to remould themselves to shed extra tonnage and become sleek and profitable. Workforces could be shrunk, and security of employment and its appurtenant protections reordered (another euphemism), denuded; and ‘safety nets’ were to save those who dropped off the employment map. Of course, the ‘safety nets’ remained mythical, but they were a useful fig leaf. When that too failed to fool, there was governance; governments needed systems by which they could govern their people, keep law and order and enable the exploitation of resources with the least disruption. Sounds familiar? How far back in history do we have to go to give this phenomenon a name?
It was an ambitious project to re-present the dominant and the powerful as weakened by the worker. Yet, the ease with which this was achieved deserves attentive study. As the nineties progressed, employers’ associations were making a bid for the law to be loosened in ways that would give freedom and liberty to the corporation. The freedom to hire and fire. To casualize labour and send into orbit, never to return, regularized labour. To scrap the law on contract labour which allowed the government to notify work that was of a kind where using contract labour was only meant as a facility for exploiting the vulnerability of that workforce. To shovel the ground away under the feet of the trade union. To take regulators off their back. To revoke the answerability of the directors of corporations – as ‘occupiers’ – in matters of health, safety and welfare in factories. To shut down and walk away from establishments without having to report to the government and get its okay. These were the imperatives for enabling competitiveness, and profitability.
Sympathy flowed through the governmental system for a decade and over, but getting into the act needed a further leap. That, it seems, has finally happened. First, there has been the casting away of the fig leaf. There is a frank and fearless averment that the ‘reform’ of labour laws is to help improve the ‘investment climate’ and ‘improve investor confidence’. The ‘compliance burden’ will be flattened out. The ‘hardships in ensuring formalities’ under the law will be lowered. The prime minister travels from country to country in the ‘western’ world doling out assurances that he will ensure ‘ease of doing business’. It is about ‘creating a more enabling environment for transacting business’, as one report reveals.5
‘Let’s start with trust’, the PM reportedly said while lauding labour reforms. Labour reforms, he said, would make it easier for companies to do business in India and that would fulfil India’s aspirations to become a manufacturing hub through a new programme called ‘Make in India’. This, of course, is the PM’s aspiration encapsulated in a slogan of his making; the project itself appears to have at its core the revamping of labour laws to suit business. The treatment of environmental, land acquisition and resource-related laws will perhaps share that trait – of ease of doing business as the rationale offered for the changes – with labour reforms. There isn’t even a pretence any more that this will be for the security and welfare of labour.
Genuflecting to the potential investor is accompanied by an admonitory paternalism where the worker is told that he will keep, or lose, his job in line with what the employer decides today as preparation for a tomorrow with more opportunity for employment. This is entirely in consonance with the employers’ persistent demand that they be allowed to deal with their workers freed from the shackles of law, and that that is the only way they will feel secure in giving workers jobs – a contradiction in terms.
There is, too, the question of employability. In 1961, the Apprentices Act was enacted, intending to let the responsibility for training and skilling youth rest with the employers who had the know-how that the state did not. That act does not reveal itself as having been effective. In 2014, the 1961 Act was amended to link apprenticeship with a system of reporting and collaborating with the government. It is not immediately clear why the government would expect this spell of the law to work when it stayed in sunken gloom in the preceding decades. Possibly the policy imperative of making the teeming youth into an economic advantage is expected to prod this law to life. May be.
A significant segment of labour law is regulatory. So, the Factories Act prescribes standards for health, safety and welfare of the workers; failure to conform to these standards constitutes an offence punishable with fine and imprisonment. The government is present in the form of the inspector to ensure that the worker is not put at risk, or denied his due. The Supreme Court has captioned regulatory offences as ‘absolute offences’,6 to distinguish them from offences in the Penal Code.
The element of intention is essential in establishing a penal offence. A lapse in maintaining a standard prescribed by the law and those implementing it makes for a regulatory offence. Also, while establishing the guilt of an individual accused is the essence of criminal law, regulatory offences place the onus on the person responsible for the lapse – the person who the Factories Act, for instance, calls the ‘occupier’. This is in acknowledgment that, while the workers are proximate to the risk and so to the consequences of risk becoming disaster, they have no control over it. Nor, as the Bhopal gas disaster showed, do those living in the vicinity of establishments that may spread harm beyond its perimeters. Regulatory laws enable the government to enter the premises to spot, and mend, situations of risk.7
This is set to change, in part because it has been ineffective. It is now widely accepted that there are extravagant expectations of the labour bureaucracy which even the best intentioned cannot meet. Yet, that is not the reason for the changes that are being brought in; it is instead to end ‘inspector raj’. Inspectors are increasingly to be kept away from factories. In Gujarat, for instance, the law is being recast to make place for a ‘self-certification-cum-consolidated annual return scheme’ which will extend to the Factories Act, the laws governing minimum wages, bonus and gratuity, and those concerning contract labour.8 Establishments within the coverage of these laws are to be exempted from inspections; there will instead be ‘regular audits’. And those establishments which comply with labour standards will be awarded ‘appreciation certificates’; a prize for following the law..
There is a Draft Labour Code on Wages Bill 2015 which is set to replace four central laws – the Minimum Wages Act 1948, the Payment of Wages Act 1936, the Payment of Bonus Act 1965 and the Equal Remuneration Act 1976. To ‘project a more friendly image to employers’ as a ‘person close to the development’ reportedly said, the term ‘inspector’ is to be replaced by ‘facilitator’. The facilitator is to ‘supply information and advice to employers and workers concerning the most effective means of complying with provisions of the Code’.9 Workers are thrown in gratuitously, for compliance under these laws has to be by the employer: for clarity – workers do not pay wages.
A labour inspector (facilitator) may continue to inspect, and examine workers, and peruse documents and registers; but where he chances upon a defaulting employer, the procedure under the law is to pause, and the facilitator is to give the employer an opportunity to make amends. If the employer complies with the facilitator’s directions, there shall be no prosecution.
One purpose of a law that provides for punishment is deterrence. Achieving deterrence needs either a penalty high enough to worry a potential offender that, if caught, however unlikely the prospect given the state of enforcement of the law, the penalty is more than he would care to bear. Or, the probability of being caught, because of the rigorous enforcement of the law, serves to deter. The meek and gentle treatment of offenders that is being mooted is at least half a universe away from fostering respect for the law.
Then there is ‘compounding’ of offences. The 2014 Bill to amend the Factories Act of 1948 introduces the idea of compounding in a proposed section 92C. A list of compoundable offences are set out in a Fourth Schedule to be added at the end of the Act. Non-provision of drinking water, or of facilities for sitting, or allowing double employment, or not maintaining registers (without which there is no record of what the factory has been doing and who it has in its employ and how they are being treated), not paying wages as due to workers – there are 32 offences listed which impact on the health, welfare and wages of the workers. Once compounded ‘for such amount as prescribed’, ‘no further proceedings shall be taken against the offender in respect of such offence’.
The Rajasthan Amendment Bill went much further. When an offence is committed, no court is to take cognizance except on the complaint by an inspector (which is the way it was) and ‘with the previous sanction in writing by the state government’.10 That is, an offence is not an offence till the state government says it may be so considered. There was, in addition, the possibility of compounding here, too, with the added sop that ‘where an offence is …compounded …after the initiation of the prosecution the composition shall amount to acquittal of the offender.’ The consequences that would catch up with a repeat offender was to be squelched by this declaration of innocence. The bill, in its journey to becoming an act, seems to have lost this last promise of acquittal, though.
As for the worker, in the past twenty years a hundred per cent of employment generated has been in the informal sector. The fault, of course, lies with the workforce in the formal sector – it is their posturing and unreason that has scared employers, making them shy away, even shun, the expansion of the formal working class. (I dare hope that the art of recognizing sarcasm has not vanished.) The answer lies in the informalizing of all labour: then no one can hold employers to ransom, and employers in turn will find the courage and the stimulus to employ more labour. For this to happen, the breaking down of the trade union is a necessary step. That will deplete the possibility of collective bargaining, of industrial action including strikes, and remove victimization from the lexicon; the last ably aided by a hire-and-fire policy.
Madhya Pradesh has been at work straining every nerve to displace Rajasthan as the frontrunner in these endeavours. In September 2014, the Madhya Pradesh cabinet gave its approval to twenty labour laws being amended.11 The labour commissioner announced that ‘lay-offs, retrenchments and even closures will not require any permission.’ It will, he is reported as having said, be akin to a ‘hire-and-fire’ policy in establishments of a designated size. In small and medium enterprises with less than 50 employees, employers may terminate any employee without assigning any reason or conducting any enquiry.
This law shares with other proposed laws the idea of more labour to be extracted from the labouring classes. Take overtime. So that labour may not be made to do more than what is fair and reasonable, the Factories Act says that a worker may do 50 hours of overtime work in a quarter. This is now proposed to be increased to 100 hours.12 The law currently says that the 50 hours may be increased to 75 hours a quarter if the government makes the exemption; this is now to be raised to 115 hours. And, ‘The state government or the chief inspector may, subject to prior approval of the state government, by order enhance the total number of hours of overtime in any quarter to 125 in the public interest.’13
The Madhya Pradesh amendment would have the overtime limit be extended only with the ‘consent of the worker’.14 It would, presumably, allow an employer to fire a worker were he to refuse, though this should not be allowed to detract from the acknowledgment of the worker’s agency. Just may be.
The proposed amendments to the Factories Act are charming in their solicitous concern for women. The restriction on night work for women has, for long, been contentious. Legal prohibition has left women without the choice of working hours; employers have experienced annoyance at having workers who cannot be organized into shifts because of the restriction; and the rest of the workforce has found it unreasonable that they have to invest equality in a part of the workforce that is excluded from night work. In the beginning, this prohibition was explained by the lack of safety in the workplace and in travelling to and from work. And there was the premise that the woman’s place is in the home, evenings and nights anyway. The exceptions to this rule existed even then, with women employed in fish canning and curing, for instance, being exempted from this prohibition;15 the imperatives of industry had to take precedence.
In the past 25 years at least, women have been demanding choice and autonomy at work; and industry has been asking for these restrictions to be lifted so women too enter the labour marketplace giving employers a wider field of choice. The time, it seems, has arrived. But the language in which it is couched carries the confusion that patriarchy has when it tries to speak the language of equality with which it is both uncomfortable and unfamiliar. ‘No woman shall be required or allowed to work in any factory except between the hours of 6 a.m. and 7 p.m.’ reads Section 66 of the Factories Act 1948, with the proposed amendment: ‘Provided that where the state government, or any person authorized by it in this behalf, is satisfied that adequate safeguards exist in a factory as regards occupational safety and health, provision of shelter, rest rooms, lunch rooms, night crèches and ladies’ toilets, equal opportunity for women workers, adequate protection of their dignity, honour and safety, protection from sexual harassment, and their transportation from the factory premises to the doorstep of their residence, it may, by notification in the official gazette, after due consultation with, and obtaining the consent of, the women workers, the employer, representative organisation of the employer and representative organization of workers of the concerned factory… allow women to work between 7 p.m. and 6 a.m…’ Equal opportunity, dignity, honour, consent; and how many people concerned about whether women be ‘allowed’ to work nights!
Leaving it to states to reform labour laws is a little demonstration of deference to federalism, no question. Yet, it is also about creating a climate of competition among states about who will lower standards of protection of the worker sufficiently to convince business that it will be protected from the worker, the regulator and the law. The era of reforms derives its energy and drive from images of the worker as villain, as vexatious,16 as violent.17 All that remains, it seems, is for the employer to now emerge from martyrdom and don the cape of the hero.
- Part IV of the Constitution of India.
Contract Labour (Regulation and Abolition) Act 1970; Interstate Workmen (Regulation of Employment and Conditions of Service) Act 1979.
Child Labour (Prohibition and Regulation) Act 1986.
Factories (Amendment) Act 1987.
Prashant K. Nanda, ‘Modi Launches Labour Reforms to Make Doing Business in India Simpler’, Livemint, 16 October 2014.
J.K. Industries Ltd. v. Chief Inspector of Factories (1996) 6 SCC 665.
Section 87-A of the Factories Act 1948: Power to prohibit employment on account of serious hazard.
‘Gujarat Labour Minister Vijay Rupani’s Note on Amendments in Labour Laws’, Desh Gujarat, 25 February 2015.
Surabhi, ‘Labour Ministry’s Reform Rewrite: ‘Inspector will now be “Facilitator” ’, Indian Express, 16 April 2015.
Clause 4 of the Rajasthan amendment to the Factories Amendment Bill 2014.
Shashikant Trivedi, ‘MP Agrees to Amend 20 Labour Laws’, Business Standard, 23 September 2014.
Clause 38 of the Factories (Amendment) Bill 2014, amending section 64 of the Factories Act 1948.
Clause 39 of the Factories (Amendment) Bill 2014, amending section 65 of the Factories Act 1948.
Supra note 11.
Section 66(2) of the Factories Act 1948.
The Small Factories (Regulation of Employment and Conditions of Services Bill 2014 promises to punish workers who maliciously or vexatiously make claims for delayed, or non-payment of wages, or of illegal deductions.
149 Maruti workers have spent two and a half years in jail, since July 2012, without bail. It took a struggle through the hierarchy of courts for some of the workers to finally be given bail. And the state was willing to pay a lawyer Rs 11,25,000 (over a million rupees) per hearing in the District Court to keep them in jail – a huge statement to industry: see Notification of the Haryana Government, Administration of Justice Department, July 24, 2012.
In the meantime, prosecution witnesses allegedly named the accused sharing them among themselves alphabetically – PW 40 listed out accused whose names started from G to P, PW 41 named those starting from P, R and S, and, as the judge of the High Court of Punjab and Haryana recorded while considering the bail application of the accused, ‘the said witness has also stated that he was not able to identify any of the accused named by him in his statement’: Sunil and another v. State of Haryana, Crm-m 27164 of 2014 dated 23 December 2014 in the High Court of Punjab and Haryana. The outcome of this trial should be instructive.
Orignally article appeared in May issue of The Seminar