Reforms and resistance

IMPLEMENTATION, ENGAGEMENT AND GOVT RESPONSE TO WORKER DISCONTENT WILL BE KEY

- SANTOSH MEHROTRA HARSHIL SHARMA

THE GOVERNMENT OF India has finally implemented its long-pending labour reforms by notifying the four labour codes on November 21. Passed between 2019 and 2020, they replace 29 existing central labour laws, consolidating them into four codes covering wages, social security (SS), industrial relations, and occupational safety and health (OSH).

In principle, these codes are aimed at simplifying regulations and extending benefits to more workers. But in the last five years, they saw widespread resistance from both labour specialists and trade unions.

The government portrays the codes as “worker-centric’, guaranteeing floorwages and social security across the board, and as a major step towards formalising the workforce. For instance, official releases emphasise universal minimum wages, provident fund/employees’ state insurance for all, and compulsory appointment letters. A national floor wage has been set, but it is extremely low (₹178 per day) and less than in many states. Also, there is no automatic formula or timeline for revising wages—the codes leave fixing wages to government discretion. The promised “one nation, one wage” is meaningful only if it is effectively enforced across lakhs of employers, a tall order in the absence of strong inspection and enforcement regimes.

The SS code remains focused on the organised rather than the unorganised sector which employs 85% of Indian workers. Even here, this code barely devotes two clauses from over 100 on the unorganised sector.