Labour Reforms and the Elusive Quest for Workers' Rights

Badrinath Rao

20 Oct 2020 8:20 AM GMT

  • Labour Reforms and the Elusive Quest for Workers Rights

    As the second largest labour force in the world, with a youthful demographic profile to boot, India is blessed with an abundance of human resource it can leverage to its advantage. Yet, one of its most enduring, if somewhat pitiless, paradoxes is that it has a deplorable history of underutilizing and ill-treating its workforce. To date, all attempts to set right this anomaly have met...

    As the second largest labour force in the world, with a youthful demographic profile to boot, India is blessed with an abundance of human resource it can leverage to its advantage. Yet, one of its most enduring, if somewhat pitiless, paradoxes is that it has a deplorable history of underutilizing and ill-treating its workforce. To date, all attempts to set right this anomaly have met with limited success.

    In what might seem as a rational, pro-working class initiative, the Parliament passed three labour code bills in September 2020. These bills - the Industrial Relations Bill, the Code on Social Security Bill, and the Occupational Safety, Health, and Working Conditions Bill along with the Code on Wages Bill passed in 2019 – supposedly aim to provide comprehensive legal protection to workers while affording employers the flexibility they need to conduct business in an atmosphere marked by uncertainty and volatility.

    Based on a consolidation of 29 disparate, often confusing labour statutes, these bills, some argue, will promote transparency, ease of compliance, fair working conditions, and better employer-employee relations.

    For a long time now, proponents of economic reforms and globalization have argued that labour laws constitute a big, almost insuperable obstacle to growth. They complained about the rigidity of labour laws, their contradictory stipulations, and the onerous strain they cast on employers. The vehemence of this assertion, in some rarefied circles, placed labour law reforms on par with more pressing concerns such as attracting foreign investment, gaining access to advanced technologies, and wooing multinational corporations.

    Even if one concedes that demands such as these are well-intentioned, one cannot but wonder if 'reforming' labour laws, particularly in the way it has been done, is a step in the right direction. Some might, albeit mistakenly, argue it is. This is predicated on the logic that simplified laws promote voluntary conformity, which will ultimately redound to the benefit of workers. This position rests on two fallacies. First, its proponents ardently believe the new bills robustly promote labour rights. Second, their understanding of labour issues is colored by concerns about efficiency, optimization, and profits, to the exclusion of everything else.

    Right from the time the central government announced its intention to reform labour laws, well-meaning labour experts, trade unionists, academics, and policymakers have proposed concrete strategies for ameliorating the conditions of the working class while accommodating business interests. They weighed in on the draft bills when they were being discussed by the Parliamentary Standing Committee. Yet, the final iteration of the labour code bills is riddled with lacunae, which defeats their entire purpose. Labour experts and policy wonks have extensively analyzed their aberrations.


    Broadly, the four labour bills offer symbolic sops to workers and substantial powers to employers. One has to be willfully obtuse to miss the flagrant imprint of the neoliberal agenda writ all over the bills. Scholarly critiques of the bills have highlighted several crucial inadequacies which frustrate their primary purpose. For instance, the Industrial Relations Code Bill (IRC) empowers employers to unilaterally close establishments and retrench workers with no obligation to pay compensation. It grants governments at all levels a great deal of latitude in applying the new laws. Under the IRC, the government can exempt any establishment or class of establishments from the law 'in public interest.' Till recently, businesses with over 300 employees could not lay them off without securing the government's approval. This limit has now been reduced to 100 employees. Distressingly, the labour code bill has also placed significant restrictions on the rights of workers to strike. One of the most worrisome aspects of the IRC bill is that it provides for fixed-term employment contracts which will enable employers to hire and fire workers arbitrarily.

    The Occupational Safety, Health, and Working Conditions Code Bill, belying its commitment to workplace safety, empowers the government to exempt businesses from the law for a specified period 'in the interest of promoting economic activity.' To compound matters, the Social Security Bill does not offer universal social security benefits to workers. It has also curtailed the powers of the bureaucracy to determine the amount of provident fund and Employee State Insurance dues owed by businesses.

    The new labour code bills overwhelmingly favor businesses. These much-hyped labour reforms will make no difference to the lakhs of guest lecturers in colleges earning pathetic wages for their intellectual labour. They do not provide social security to Accredited Social Health Activist (ASHA) and Anganwadi workers. Nor will they end the daily humiliation and sexual harassment of workers in the lower echelons of the workforce.


    To comprehend the limitations of labour reforms, one has to recognize three intractable dimensions of the problem. First, of the 520 million workers in the labour force, 94% are in the unorganized sector. Barely ten percent are unionized. Workers, therefore, have woefully limited bargaining power. Second, no matter how stringent, laws are barely implemented. Their efficacy has to be evaluated in the larger context of the crippling infirmities of the justice system. We have rule by law in India, not rule of law. Also, as Roscoe Pound, former Dean of the Harvard Law School, pointed out long ago, there is a huge discrepancy between law in books and law in action. No matter how robust, mere legislation cannot make much difference to the everyday lives of workers. Third, except for a handful of progressive judges, almost the entire judiciary has a perfunctory attitude toward the working class. Recall that even judges of the Supreme Court have disparaged workers in their obiter dicta. Together these factors pose almost insurmountable barriers to vindicating workers' rights in India.

    A systematic analysis of labour reforms must address a host of questions: what are the real challenges facing the labouring class? Why do labour laws almost never make a difference in the lives of workers? If we are genuinely interested in labour reforms, where should we begin?

    The first thing to note is that the labour code bills show little appreciation of massive transformations taking place in the world of work and occupations. We are on the cusp of what Klaus Schwab, founder of the World Economic Forum, describes as the Fourth Industrial Revolution. Other scholars see the current transition as the next stage of the Great Transformation Karl Polanyi enunciated in 1944. Julie Cohen, Professor of Law at Georgetown University in the US, has identified three major changes which will have far-reaching impact on labour. They are 'the propertization of intangible resources, dematerialization, and datafication.'

    While the denouement of these cataclysmic shifts is hard to predict, in the immediate context they have led to precarity, marginality, disempowerment, insecurity, alienation, and obsolescence. Rising inequality, new labour-saving technologies, the digital divide, and ease with which capital can seamlessly source labour from different places have all made the working class defenceless.

    The less obvious, yet more deleterious, threats are the erosion of dignity and recognition, human security, and virtually no opportunities to thrive as workers. This is apparent from the plight of gig and platform workers who, according to the British labour economist, Prof. Guy Standing, are part of the 'concierge economy.' Though labeled micro-entrepreneurs and independent contractors, they are perpetually consigned to a limbo. They are not employees and hence not entitled to any benefits of a regular job and, save their labour and, sometimes, their vehicles, they have no capital worth the name to qualify as entrepreneurs. Gig workers are ubiquitous in big cities. They deliver pizzas and parcels. They carry out tasks we loath to do ourselves. With no fixed income, regular working hours, a workplace, and fellow workers to relate to, platform workers are disembodied entities who assume a corporeal form only to do the jobs they are lucky to get. Because it is so cheap and efficient, we love the gig economy. Gig workers, however, do not even register on our minds.


    Labour laws seldom work because they do not accord primacy to two points. First, through our laws, policies, and everyday acts, we deny the personhood of those who work for us. Lowly workers are not human beings. Thus, farmers, teachers, construction workers, factory workers and so on are a nuisance whose existence we reluctantly acknowledge when they agitate and block arterial streets. Lately, even the courts want to render them invisible by imposing restrictions on how and where they can protest. Excluding such extreme circumstances, the working class does not exist for us. We live in a self-induced stupor to insulate ourselves from the messy challenges of the working class. A mindset that refuses to acknowledge the very humanity of workers can never offer lasting solutions to their problems. Consider how menial servants are generally depicted in films, TV soaps, and popular culture. Almost always, they are portrayed as obsequious and dumb factotums with no sense of agency. Because we do not see labourers as purposeful human agents, we have no respect for them. Hence we pass shoddy, tokenistic laws and call them 'reforms.'

    Second, labour laws are ineffective because they are premised on the notion that labour is a commodity. The International Labour Organization has categorically repudiated this idea. If we view labour as just something that can be bought and sold, we make a foundational error. Throughout the world, we see, in varying degrees, a mismatch between the potential of workers and the demands of their job. When work is reduced to a mere source of livelihood, workers are estranged and miserable in their occupations.


    Work is central to our identity. It defines our personhood; it gives us a sense of who we are. More than a source of livelihood, labour defines our place in the world. Moreover, work that is in tandem with one's innate human potential and results in its efflorescence confers ontological security. It ceases to be a chore. Instead, work becomes an endless source of joy.

    The labour we do also determines our community. It is a source of our values and worldview. Creating a scientific, well-organized workforce where every individual is afforded the opportunity to go as far as their talents will allow is a compelling algorithm of a cohesive, affirming society.

    Any meaningful attempt to reform labour laws has to begin by overhauling the philosophical premises of this enterprise. This involves recognizing that values such as human security, dignity, recognition, human capabilities, and human flourishing are inviolable. The threshold question to ask, therefore, is do the contemplated reforms further reinforce these bedrock values. All laws and reforms must be refracted through the prism of these values and must fully comport with them.


    A stable, well-defined occupation with good career prospects and work we relish are the most edifying sources of security. The United Nations Development Program defines human security as 'freedom from want' and 'freedom from fear.' A reform initiative that facilitates a hire-and-fire policy in the name of labour flexibility without providing dependable alternatives is conceptually flawed. Likewise, the notion of dignity serves as a guidepost for ameliorative measures. A rich philosophical tradition, starting with Roman statesman Cicero (44 BCE) has developed the idea of dignity from a signifier of aristocratic rank to the most distinctive feature of human beings. Cicero argued that humans have dignity because of their capacity for rational thought. Giovanni Mirandola, a 15th century Italian philosopher, also underscored human dignity, ascribing it to the human power of self-transformation. He maintained that the capacity of humans to be whatever they wish to be entitles them to an innate sense of dignity which cannot be transgressed.

    Immanuel Kant, the 18th century German philosopher, explicated the significance of dignity by relating it to our status as normative beings. One of the universal laws in his formulation of the Categorical Imperative requires us to treat people as ends in themselves, not as means to an end. Kant's view is that, as moral agents, we can make and obligate ourselves to universal laws which cannot be contravened. This capacity to harness the transformative power of reason and morality, regardless of what we do with it, entitles us to dignity.

    The labour code bill desecrates human dignity by treating workers as cannon fodder. Its provisions such as the government's discretionary powers to suspend labour laws on flimsy grounds, withholding social security benefits, and restricting strikes and lockouts are repugnant to the inalienable rights of workers. These aberrations emanate from an ideational negligence of the sacredness of human dignity and its multifarious manifestations. They also explain why the labour code bill cannot address one of the core challenges of the working class, namely, insulating their dignity from the relentless incursions of market forces.


    A related, if poorly understood, point concerns the umbilical relationship between dignity and human flourishing. The Aristotelean notion of eudemonia, the striving to become one's best self, is the quintessence of human flourishing. Aristotle emphasized the imperative of creating a social arrangement that enables people to access their higher selves. Thus, human flourishing, both regarding one's own life and in reference to the lives of others, ought to be the polestar of all our endeavors. This project demands respect for human agency and dignity. Where dignity is eroded, human beings do not flourish. Further, human agency is fortified when we create an ecosystem that identifies and nourishes talent. The optimum utilization of one's talent is the most enduring wellspring of happiness. Besides devaluing dignity, the labour code bills are silent about equipping workers and training them for moving up the value chain. They are oblivious to the fact that being stuck in a low-paying job with virtually no prospects for professional growth is a recipe for labour unrest. What is noteworthy is that on the one hand, the labour code bills create the conditions for discontent among workers and, on the other, imposes debilitating restrictions on agitations.


    The drafters of the labour code bills could have avoided this grotesque contradiction by incorporating Nobel laureate Dr. Amartya Sen's ideas on human capabilities. His theory marks the culmination of a dense and variegated philosophical debate on equality and human development. Approaching development primarily as an avenue for expanding human freedoms, Dr. Sen argued that fostering human capabilities is a sine qua non for promoting genuine equality. Going beyond philosophers like John Rawls, Richard Dworkin, and Thomas Nagel, who focused on the equitable distribution of resources, Dr. Sen advanced the basic needs and capabilities approach to equality. He maintained that freedom is not just the achievement of things a person values or has reason to value, but also the capability to achieve these things. This broad notion of freedom burgeoning from the development of one's human capabilities is what laws must aim for. Viewed from this perspective, the labour code bills are conceptually brittle. They privilege the rights of employers over those of employees. Their unstated premise is that what workers claim as rights are largesse offered by the state and employers. The major thrust of the bills is to contain and manage the aspirations of workers, not to create a regime that fosters enabling capabilities. This is one of the chief reasons nothing in the bills even remotely empowers workers and enhances their bargaining power.

    One might argue that the mandate of the Labour Code bills is to reform labour laws, not to promote equality and human capabilities. This dichotomy is untenable. Labour relations do not operate in a vacuum. Workers' rights are imbricated with social attitudes toward the labouring class. One things feeds off the other. Thus, since labour rights are anemic and effete, workers are relegated to the periphery. Consequently, they suffer from the blight of social disdain. Because the labouring class is the object of contempt, its needs are not accorded priority. Over time, this vicious cycle acquires a life of its own. The upshot is that workers suffer from a double whammy: unequal bargaining power and misrecognition with no end in sight. Philosophers like Charles Taylor and Nancy Fraser have written extensively on the importance of recognition in our lives. They state that we become fully human through a dialogical process when others recognize us for who we are. Mis-recognizing or withholding recognition is oppression. The politics of recognition currently on the ascendant across the globe seeks to reverse this trend. The labour code bills could have aided this process by being fair to the working class. Instead, they can barely conceal their pro-capital tilt.


    All the abnormalities of the labour code bills emerge from and are sustained by two sources: first, our philosophical misconceptions about labour and its role in promoting the common weal; and second, a common sense that denigrates most forms of labour. Redressing this situation demands dismantling the artificial mental roadblocks we have set up. We can undertake this task at several levels. As a first step, we must junk school and college textbooks that purvey apocryphal stories about how some politicians grappled with alligators in their childhood. Likewise, hagiographies of film stars and cricketers must be excised. Instead, our children must be taught to appreciate the value of labour, the importance of dignity, and what we owe to each other as human beings. Second, judges, bureaucrats, the police, legislators, and educators must be required to undergo compulsory sensitivity training about the toiling class and their everyday struggles. Third, the demeaning depiction of labourers in popular culture must end. Contrary to popular perception, denigrating the working class - not some salacious scenes in the movies - is the most objectionable form of vulgarity. None of these initiatives will succeed if we do not first bury the labour code bills fathoms deep. Barring business owners, no one will notice their demise.

    The views expressed in this essay are personal

    (Badrinath Rao is an Associate Professor of Sociology and Asian Studies at Kettering University in Flint, Michigan, in the US. He is also a practicing attorney in the United States)

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