The central government has circulated a draft of the Unorganised Sector Workers Bill, 2004 among the trade unions for their comments. While the Bill seeks to regulate the employment and conditions of service of unorganised sector workers and to provide for their safety, social security, health and welfare, it is silent about the basic problem of the workers in the unorganised sector, namely the lack of economic security. Economic security consists of employment security and income security. The main characteristic of the unorganised sector is that the workers here lack jobs or continuity of employment and work for low wages. 

Every one needs to work to earn his or her livelihood. The need is, therefore, of an opportunity to work. If a person is not able to work for any reason, social security should be provided to the person. The concept of the right to work and the right to social security originates from these needs and these are regarded as the basic human rights.

Right to Work and Social Security

The right to work has precedence over the right to social security. The society has an obligation to ensure that everyone who is able to work has an employment whereby a livelihood is earned. Social security comes in only if one is unable to work for any reason. The same idea is reflected in Article 41 of the Constitution, which requires that the State should make effective provision for securing the right to work and to public assistance in cases of unemployment, old age, sickness, disablement and in other cases of undeserved want.

The Ninth Five Year Plan document says, “Productive work is not merely a means to the ultimate end of economic well-being. It should be seen as an end in itself. It is a basic source of human dignity and self-respect. It is also an integral element in nurturing national identity and social cohesion.” Although rapid economic growth is the surest and most sustainable source of increasing work opportunities, market forces alone cannot be relied upon to provide gainful work for all. This is particularly true in a labor-surplus economy like India. The congruence between the skill and spatial distribution of the labour force and the corresponding requirements of the economy may not be achieved through market-based mechanisms due to numerous distortions in the labour markets, information systems and infrastructural endowments that continue to persist in the country.

It further says that the primary objective of state policy should be to generate greater productive work opportunities in the growth process itself by concentrating on sectors, sub-sectors and technologies which are more labor-intensive, in regions characterised by higher rates of unemployment and underemployment… “Public intervention will be necessary to ensure not only that adequate work opportunities are created, but also that the labor force is able to access these opportunities.” In India, public intervention is necessary not only to create work opportunities but also to ensure access thereto.

More Workers, Less Jobs

It is well known that in India, generation of employment is not keeping pace with the addition of millions of skilled and unsilled people to the labour force. There is a large gap between the number of workers seeking employment and the number of jobs created.  Besides, the nature of jobs created is such that there is a growing casualisation of labour.  The workers have to compete among themselves to secure the few jobs, which are available.

In the garment factories in Bangalore, every morning hundreds of jobless workers wait at the gates to look for jobs. If a factory has received sufficient orders, it takes a few workers and the others leave. If there is no fresh order, nobody is taken. No worker gets an order of appointment and there is no question of confirmation of service. The salary is less than that of the minimum wage.  An application is taken from the worker for admission to the Employees Provident Fund Scheme or the ESI Scheme, but it is never forwarded to the respective offices. Contributions to these schemes are deducted but not remitted. If a worker demands higher wage or wants to know what happened to the PF or ESI contributions, the worker is replaced by a new worker the next day. What the workers in the unorganised sector need is security against this kind of uncertainty and exploitation.

Provide Security to Workers

The Dock Labour (Regulation of Employment) Act 1948, the Kerala Headload Workers Act 1978 and the Maharashtra Mathadi Hamal and other Manual Workers (Regulation of Employment and Welfare) Act 1969 provide a model for the security of employment in the unorganised sector. These Acts provide for establishment of tripartite boards to regulate employment and conditions of service and welfare of the workers The Boards register the workers and employers. No employer is permitted to employ a worker who is not registered. If an employer needs the service of a worker, he has to approach the Board, which will nominate the worker. In doing so, the Board ensures that the available opportunities are equitably distributed among the registered workers and the number of registered workers. The wages payable to the workers are determined by the Board periodically through negotiations with the employers and the wages so fixed are paid by the employers to the Board, which in turn disburses the money. The employers are required to pay a premium above the wages for the welfare of the workers out of which the Board provides all the social security benefits. These laws were conceived as ‘decasualisation measures’ and they have been highly successful in achieving the objective.

 “Although quite a few characteristics of an unorganised sector still remain with the mathadi labour market, it is also a fact that almost all the protective social security benefits have been achieved by the mathadis, “ says Professor R C Datta of the Tata Institute of Social Sciences, Mumbai who conducted a study on the working of the Mathadi Boards. In another study of the Kerala Head Load Workers Act, S Mohanan Pillai says, “The regulation of employment of headload workers under the scheme ensures discipline among them as also facilitates a peaceful atmosphere in the workplaces which in the past used to witness sporadic clashes between workers and employers in the loading and unloading of goods and wage settlements leading to severe law and order problems. The scheme warrants a renewed role of trade unions more in the form of welfare activities by supporting the welfare board authorities in the implementation of the scheme.”

In a letter to the Chairman of the National Commission on Labour, the Akhila Bharatiya Mathadi Transport and General Kamgar Union says, “In view of the regulation of employment and timely deposition of wages and levy with the Boards, all the benefits reach these workers in time. The standard of living of these workers has considerably improved.  Mathadi workers live with grace and pride and thus their social status has improved.” The union has suggested that “such type of enactment should be made and implemented all over India, in all the states, to cover the large number of unprotected manual labourers who are deprived of their rights.”

“With compulsory registration of employers and workers, regulation of employment and wages, management of work records through the Board, the workers will rightfully get the social security benefits and also get liberated from exploitation,” says the Nirman Mazdoor Panchayat Sangam of Tamil Nadu.

One of the interesting developments in the past few years has been the emergence of proposals for establishing tripartite boards for regulating employment and conditions of service of workers in the other segments of the unorganised sector. A tripartite committee had unanimously recommended the establishment of tripartite boards for regulating employment and the conditions of service of brick kiln workers to assure them reasonable wages and other social security benefits. The National Campaign Committee for Central Legislation for Construction Workers drafted a Bill and a scheme on similar lines providing for the setting up of tripartite   boards for construction workers. The aim was to register both employers and workers, allot workers to employers (usually contractors) on a rotational basis, arrange for payment of wages, provide for social security measures, fix and collect levy from the principal employer as also from contractors for paying wages and benefits and ensuring social security to workers.

The National Commission on Rural Labour had also recommended the setting up of such tripartite boards for regulating agricultural labour. It had expressed the opinion that the boards could be styled on the Employment Security and Welfare Board. The boards could supervise and monitor the working of the various provisions of the Act concerning agricultural labour. The Second National Commission on Labour had suggested that such boards should be set up for the building industry on an experimental basis in some states like Tamil Nadu where the demand for workers is high before extending it to other states.

Establishment of such boards is the best means of ensuring employment security to the workers in the unorganised sector where employer-employee relations are weak. The boards could provide a platform on which the workers can come together and organise themselves.