Labour Law Reforms - For Whom The Bell Tolls?
Both the national and foreign capitalists are demanding for reforms of the existing Labour Laws more nearly 20 years. According to the "Note on Labour Policy Reforms" published by FICCI just prior to 2014 parliamentary election targeting all political parties aspiring to form the government, reforms of these laws are needed to make the laws "simplified, clubbed together wherever possible and made less cumbersome" (source: http://ficci.in/SEDocument/20301/FICCI-NOTE-ON-LABOUR-POLICY-REFORMS.pdf), so that it can become "business friendly". However, the actual intent of their demands is amply clear from the Note itself - further intensifying the exploitation on the working class by depriving their right to organize and struggle and also by curbing their existing benefits. Indian ruling class under the leadership of Modi & BJP in their 2nd term has advanced ahead to reform existing labour laws. It has reduced 44 labour laws under the purview of Central Government and more than 100 under State Governments to four separate codes. Codes are: a) The Code on Wages, 2017, b) Labour Code on Industrial Relations Bill, 2015, c) Draft Labour Code on Social Security, 2018 & d) Labour Code on Occupational Safety, Health and Working Conditions, 2018. Among the four, the Code of Wages has already been passed silently in the parliament and the rests are in the cue. Based on the latest trend going on in the parliament, it can easily be said that all the bills would be passed soon without much hiccups.
Each Code is heavily weighted with nearly hundred pages and right now it is not necessary to enter into its intricacies. What is important is to identify the major changes related to the lives, struggle and organizations of the working class. We have stratified it into three categories.
Category A. Right to Struggle and Organise.
1. From now on, a minimum of 10% of workers or 100 workers employed in an establishment or industry would be needed - from seven at present - to apply for registration of a trade union. Experience says that it's just a flip of the fingers for the employers, particularly for the more powerful ones, to get the full list of applicants from the labour directorate, and hence from now on bigger number of leading workers would be made vulnerable to the management at the infancy of the trade union formation.
2. Union registration process has been made stricter. The competent authority would have every right to decline the application of registration. Once declined, Workers would have the only option to go for legal proceedings, which itself is a time-taking and expensive affair. It means that once application is cancelled, it would be more arduous to the workers to go for registration of the Union.
3. From now on, only two from the outsiders would be allowed to become the member of the Union. Whether the involvement of the outsiders have actually helped the workers historically to remain struggling and organised is altogether a different and disputable question, the moot point here is that it is a gross intervention in the democratic rights of the workers regarding whom and how many number of outsiders they would make the members of their union.
4. At the other end, only seven employers would now be able to form a Union. What does it signify? In the era of globalisation, different industrial estates/SEZs etc have emerged where good numbers of employers are clustered together and generally in the present sorry state of class struggle, workers working in these estates are still much more vulnerable in front of the exploitations of their employers. Even in this sorry state, employers in these estates would now be able to place their demands to the workmen for working harder with lesser wages in an officially organised manner.
5. In case of strike, compulsorily notice is to be given at least 14 days prior, otherwise it would be considered as illegal - previously it was applicable only for the industries considered as "public utility services". Not only that, management would have the right to deduct eight days' wages for any lightning strike-tool down etc even for one day. So, more armour is provided to the employers to curb the strike, a major tool of organised struggle of the workers, in this new law.
So, it is apparent that more severe ammunitions have been provided to the capitalist class to scuttle the right to struggle and get organised through the drafted laws.
Category B. Right to Hire and Fire.
1. Employers have been empowered for "Fixed Term Employment". In lieu of engaging permanent workers, at least for the more skilled jobs, they would be able to engage the workers for a fixed duration and without any terminal benefits. Permanent jobs have already been reduced drastically, now after this new law, it would be on the verge of extinction.
2. Not only that, though the employment of contract workers in the core production have been the norm of the day, at least it was stated in the old labour law that they cannot be employed there; so, there was a feeble legal provision to raise the demand for permanency of these workers. That provision will be no more in the new law - contract labour can now be employed in the area of production.
3. From now on, employers of the factories with less than 300 workers would not be required permission from the government to implement lay-off, closure and retrenchments in their factories. So, full and instant freedom for retrenchment-lay off-closure for the employers where numbers of workers are less than 300. Previously it was applicable for the factories with less than 100 workers. However, issue is not merely the increase in number of workers. In case of factories with workers more than 300, if the authorised govt officials remain numb for just 60 days regarding the permission sought by the employer in this regard, as per new law, it would be treated as approved. So, for the factories with more than 300 workers, the difference is just that the management would not be able to implement the action planned instantly, but need to manipulate the govt officials & wait for just 2 months.
Job securities have further been reduced; mode of exploitation has been made more severe through the changes.
Category C. Issue of wages and future provisions for the workers.
1. From now on, minimum wages will be reviewed or revised only after five years. Previously, there was no such time bound approach except that it cannot be unrevised for five years. However, another significant addition in this regard is withdrawal of the provision of punishment of jail term of the employer for non-compliance of minimum wage. From now on, employers will be allowed to make payment of wages less than the govt determined minimum wages just by depositing some monetary penalties to the government.
2. According to the Code on Wages that have already been passed in the parliament, the appropriate Government shall take into account the skill required, the arduousness of the work assigned to the worker, geographical location of the place of work etc for determining the factors for minimum wages - previously the primary determining factor was the minimum calorie requirement. It has now become secondary.
3. All the social security funds have been conglomerated to a single fund to govern pension, provident fund, medical benefit etc. for all kinds of workers, including part-time, casual, fixed term, domestic and home-based workers. Not only that, initiatives has already been taken to merge retirement plans covered by the Provident Funds Act, 1925, that would be regulated by the labour ministry through EPFO. This means a portion of the deposits with these funds could now be invested in stocks, as per the pattern followed by the EPFO. (Source: https://economictimes.indiatimes.com/markets/stocks/news/stock-market-to-get-a-boost-as-over-24-pfs-come-under-epfo/articleshow/65665688.cms)
4. Income slabs (broad categorisation) have been created and linked to pension for the first time. This reaffirms the "defined contribution" over "defined benefit" feature of pension schemes under the code.
Not only job securities has been reduced, no stone has been left unturned for the benefit of the capitalist class at the cost of making the present and future lives of the working class much more uncertain and unsecured.
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As said earlier, both the national and foreign capitalists are keen for labour law reforms. In 2014, prior to national general election, FICCI supported by All India Organisation of Employers (AIOE), had submitted few proposals to the political parties aspiring to form the government, to change the existing labour laws for the purpose of "making labour policy investment and employment friendly". (Source: http://ficci.in/SEDocument/20301/FICCI-NOTE-ON-LABOUR-POLICY-REFORMS.pdf) In it, some of their main demands were like: a) Labour laws should be made simplified and stratified only in four heads; even the heads had also been specified by them which is same as the govt has made; b) right of employment for short and fixed term; c) right to employ contract workers in all sorts of jobs; d) abolition of government permission for lay off-closure and retrenchment for factories with less than 300; e) compulsory notice for strike at least 14 days in advance in all sector of industries; and many more which are exactly the same as proposed by the government. So, it is apparent that the Modi government in its 2nd term is trying it hard to comply with the demands of FICCI.
But why the capitalist class is so intent for labour law reforms? We can refer here two separate documents to get their perspective. One, in the India Development Update March 2018, World Bank has concluded that "Among the many preconditions for India to improve its competitiveness are infrastructural boosts to bring it on par with the current manufacturing hubs of the world. In addition, reforms to land, labor and financial markets are needed to assure the continued competitive supply and use of key production inputs, such as labor, land, finance, and skills." (Source:http://documents.worldbank.org/curated/en/814101517840592525/pdf/Indiadevelopment-update-Indias-growth-story.pdf) Two, in its June 2019 issue of the Ecowrap prepared by the research team of State Bank of India., it has clearly stated that: "Though, the cases of industrial disputes in the country have come down, they are far more when compared to other countries. (...) barring India and Srilanka, in no other country approval is required for collective dismissal. (...) Recognizing the high cost of compliance with existing labour regulations and the complexity generated by various labour laws at the central and state levels, the central government has recently introduced policies to make compliance easier and more effective. They are also simplifying and rationalizing the large and often overlapping number of labour laws." (Source: https://www.sbi.co.in/portal/documents/37947/108248536/Ecowrap_20190620.pdf/37525e7c-4607-4ca4-92ec-5e4d7910b18d)
So it is apparent that the capitalists want unhindered freedom to further their exploitation of the workforce and thus the reforms being promulgated by the BJP government. They want minimum labour related disputes, freedom from licence-registration-maintenance of records etc, freedom from judicial hassles on labour related issues, freedom to employ contract labour, absolute freedom to closure of factories and finally, the most important is depriving the workmen. from right to organise and struggle. All these requirements are being fulfilled through the proposed labour law reforms.
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The cheap labour force of 3rd world countries, particularly of India, was a major resource of surplus generation for the global capital since beginning of the policies of Globalisation & Neo-liberalism. However, since 2008, imperialist economy is passing through a critical phase and more than ten years are over and still it has not been able to overcome the crisis. But right now they have no other avenue but to advance the same policies to the 3rd world countries with much more tooth and claws. On the other hand, Indian ruling clique under the leadership of Modi is very much keen to obey the dictats of imperialism as well as national capitalists. Present Labour law reform shows how keen the Modi government is to respond to the demands of the capitalists. And, the reforms on board are the reform of existing Land Acquisition policies and also financial sector reforms - those are also the major agenda of the international capitalists. With absolute majority in the government, Modi government would easily be able to serve the imperialism for these agendas also.
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It is apparent that labour law reforms would only bring further distress to the lives of vast section of the working class of India. Existing central trade union organisations are officially opposing the reforms - even BMS, the RSS wing of Trade Union, is also opposing some points of the proposed reforms. But the moot question is whether they are at all interested to resist the reforms. The blunt answer is - no. All the central Trade Unions of the parliamentary political parties have become nothing but the lackeys of the capitalist classes. So, they always ensure that the primary interest of the capitalist class, exploitation of the working class to generate surplus value, is not hurt. They consciously act in such a way so that the independent class struggle of the working class cannot unfurl, because they know that, that only can advance forward towards challenging this basic interest of the capitalist class. And, one of the major programme for them to do this is to limit the working class in the arena of the parliamentary politics and struggle. And, the prolonged history of nearly fifty years of limiting the working class struggle in the parliamentary arena by these forces have brought the working class of India on the verge of abyss and they are no more capable to return back the working class from that abyss. Even most of the communist revolutionary organisations active among the working class are no different - they are also treading the similar routes.
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So, where lies the future? First of all, in the face of present precarious state of global as well as national economy, the capitalist class has no other option but to intensify the magnitude of exploitation on the working class to run the wheels of capitalism. Labour law reform is a manifestation of this bare truth. So, in its reverse end, there will be no mid-way path to the workers to survive. Either they have to proceed for all out resistance to these attacks or simply, they have to perish. If they perish, capitalism will also perish with them and thus the human civilisation also. Working class cannot choose that path. Whatever be the pathetic state of present day class struggle, on the basis of the experience of the whole history of international working class struggle, we have the strong conviction that for their own survival working class of India will go ahead for all out resistance and those days are no longer awaited. Secondly, this all out resistance cannot be achieved thru' isolated factory based struggles; it may emerge (the glimpses of which have already been flashed during last few years) form factory based trade union struggles, but soon it would advance further as because they will soon learn from their struggle that attacks of capitalist class being unleashed through labour law reforms cannot be resisted through isolated factory based resistance; so, there will be a cry for united organisation and united class struggle. Thirdly, in the process, to advance their struggle, they shall have no other option but to isolate themselves from the existing political parties and their trade unions, as because from their own experiences they have already learnt that these parties are not the representatives of their class interests. Not only that they would isolate themselves from these parties, they would also separate themselves from practices-habits and modes of struggles that have been taught by these parties - the new organisation of the working class would bring forward new forms and practices in the class struggle independent from these parties. One major manifestation of limiting the working class into the parliamentary arena is excessive stress on legal battle for the trade union struggles. Existing trade unions have for a long time taught the workers to leave struggle at the factory gate and to depend much on starting from trade union registration to conciliation at labour commissioner's office-labour tribunal-labour court-payment of wages court-high court-supreme court etc etc. Since beginning of the 21st century, scope of legal battle under the trade union arena has already started to diminish even without the change of existing labour laws. Still, as and where workers are choosing the path of struggle, the dependence on legal battle remains more or less apparent. Now with the proposed reforms, the scope of legal battle for the workers is becoming virtually redundant. So, from now on, working aspiring to combat the attacks of the employers thru the struggles shall have no other option but to return to its historically destined original path of open struggle at the factory gate. So, present labour law reform would only enhance the scope of open class struggle. The future lies here.
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