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Poorest of poor of unorganized sector 'kept out of' India's new social security code

Counterview Desk
Representatives of trade unions and workers organisations of all sectors (including formal, informal, self-employed and home based workers), who met in Delhi on October 23-34, 2019 in order to analyse the Code on Social Security 2019, published at Ministry of Labour and Employment, has taken strong exception to the Government of India seeking to exclude the unorganized sector, insisting, what is actually needed is a right to social security Act.
Insisting that there should be no discrimination between “organised and “unorganised” workers, in their response to the Centre’s new social security code, a draft of which was released last month, said that the right to be entitled to access to all the benefits have been clearly identified by the International Labour Organization (ILO). Sent to Sanjeev Nanda, undersecretary, ministry of labour and employment, the response, prepared by 54 trade union and civil society organizations (click here for list), wants the ministry “to think afresh” about what it is proposing.

Text:

Social security is a universally recognised human right. The ILO through its Convention No. 102 of 1952 and two of its recommendations on a social protection floor of 2012 (R-202), and (B) and on transiting from the informal to the formal economy of 2015 (R204), has recognised that life cycle approach must be adopted in order to promote social inclusion and human dignity. 
This is to be achieved by provision of benefits, in cash or in kind, intended to ensure access to medical care, and health services, as well as income securities through provision for illness, unemployment, employment injuries, maternity, family responsibility, invalidity, loss of family bread winner, as well as during retirement and old age.
The Constitution of India through its Preamble, its Fundamental Rights and its Directive Principles of State Policies seeks to achieve economic, social and political justice for all its citizens, and cast a duty on the state, to apply relevant principles, in making laws.
These principles, include measures to reduce inequalities, to ensure that the health and strength of workers, men, women and transgender, and the tender age of children are not abused (Art-39), that right to work, to education, and to public assistance in cases of unemployment, old age sickness, and disablement (Article 41), that provision for just and humane conditions of work, and maternity relief, that living wage, condition of work ensuring decent standard of life and full enjoyment of leisure, and social and cultural opportunities, ending with Article 43A, which stipulated participation of workers in the management of undertaking, establishments or other organisations engaged in any industry.
Against the above national and international standards related to social security, this Consultation is of the opinion that the following nine components endorsed by the ILO must be converted into non-negotiable minimum standards made available through justiciable legislation concerning social security. India being a founding member of ILO also owes political responsibility to implement such standards. Beside this, India has also committed to SDG goals particularly Goal- 8 which advocates to achieve the decent work agenda for entire workforce.
We are even more happy to note that the ESI Act of 1948, and EPF, 1952 put together satisfies 9 components of the ILO social protection floor shown in the table above.
Social Security Code (3.0) does contain separate chapters dealing with EPF, ESI, Gratuity, Maternity Benefits and Employees compensation. These 5 elements constitute substantive contents of social security. Unfortunately, however the Code in question is crafted in such a manner, that it dilutes even the existing social security meant for organised sector, and clearly excludes the unorganised working peoples’ of India. We, therefore strongly oppose any form of dilution and exclusion in same.
A joint reading of the opening of the Code and several definitional clauses, especially the very first section, through sub-clause-4 dealing with the applicability of the Code read with 1st schedule and further reinforced by the definition of unorganised workers in sub clause of Section 2 (58), makes it abundantly clear that the Code seeks to exclude the unorganised workers from the 5 substantive contents of the Code, relating to PF, ESI, Gratuity, Maternity and Employees Compensation.
It is therefore important to mention that this version of Social Security Code does not even meet the existing social security standards, and also leaves the rest of the 93% workforce out of its fold and ambitiously aims to add new forms of work such as gig and platform economy without assuring anything for them in the code.
There may be a clever attempt to say that Chapter 9 covers social security for the “unorganised workers”. We reject this approach, since what Chapter 9 contains, is merely a list of the welfare schemes which the Central and State governments may make available at its executive discretion on some indefinite future dates, along with 13 schemes contained in Schedule 7 of the Code.
What is needed instead is to extend the organised sector benefits like ESI, PF, gratuity, maternity and employees’ compensation to unorganised sector by including the latter under existing legislations for the same with appropriate amendments.
We are cognizant of the fact that universal social security for the working people of India needs resources. Such resources will have to be raised through multiple means including appropriate budgetary allocations through revenues to be raised by way of taxation, levy, cesses, or any other appropriate means, as the government may deem fit with the consent of the stakeholders.
Ideally such resource mobilisation must be a joint effort, of both the Central and State governments in the spirit of the concurrent sphere of our Constitution. But if this spirit is to be fully respected, the trend to over centralise the management and administration of social security in the hands of the Central government through CEO-led corporatisation must be strongly discouraged and dropped from the Code.
This convention is cognizant of the fact that at present, PF and ESI are contributory schemes. This arrangement may continue for the organised sector, but when it comes to the unorganised sector, the primary responsibility of finding budgetary resources shall be that of the state, including measures like making welfare boards (building and construction, domestic workers) taking inspiration from the Maharashtra Mathadi Board could function and fulfill the employers role.
We further recognised that even in the unorganised sector, the contributory scheme for PF and ESI may be creatively used in case of wage employment where there is adequate contributory capability which in turn will be a function of the Wage Code.
It must be clearly reiterated that among the poorest people of India are sections of the self -employed and the social security must be extended to them as first priority through non-negotiable budgetary allocation.
Successful implementation of the Right to Work, as contained in MGNREGA, is the most critical input for the realisation of social protection
We call upon the Government of India to come out with a white paper indicating clearly the disaggregated number of the people of India, who need to be included in the floor level of social security as recognised by the ILO, the resources necessary for the same also indicating how the said resources will be raised.
The approach required for floor level social security protection is the rights-based approach, and not the means-based approach, where floor level is denied in the name of resource crunch.
This is one piece of legislation which eminently deserves a financial memorandum to accompany the Code when the bill is introduced in the parliament.
Such a white paper as indicated in Para 14 above must constitute the basic document for “pre-legislative consultative process”, and must be put up on the website of the Labour Ministry before any further steps on the social security front are initiated. The document prepared should be done in other languages as well for wider response. Also, the existing timeframe for giving responses provided that of one month should be made at least six months.
We must now turn our attention to multiple welfare boards that exist in different parts of the country. We must recognise and welcome Welfare Board of a tripartite nature with extremely creative approaches for resource mobilisation.
At the top of our list is the Mathadi Welfare Board, which raises its own resources, and provides even more social security than the floor level. Why then is this innovation sought to be derecognised. This smacks of a “dog in manger policy” and must be dropped.
The Building and Construction Workers Act 1996 and welfare boards through its own cess-based resource is now sought to be “nationalised” and killed prematurely despite resource richness even while the Supreme Court has passed orders to bring it to full life and efficient functioning.
We reiterate that the floor level must be legislatively guaranteed to the entire people of India (based on the principles of “self- selection”). But innovative welfare boards as listed in the Annexure of this document must not only be fully protected, but in addition they must be encouraged and allowed to blossom to full capacity.
The approach required for floor level social security protection is the rights-based approach, and not the means-based approach
The history of labour legislations in India consist of general laws cutting across all sectors like the Trade Union Act 1926, alongside with sectors specific legislation to address the unique nature of each sector. For example – fish workers cannot be told by the government what time they must go out to sea, though regulation during fawning season, and banning of bottom trawlers is absolutely necessary.
An encouraging factor related to “Right to Life Jurisprudence” as evolved by the Supreme Court while interpreting Article 21, includes “Right to Work (MGNREGA, Right to Food, National Food Security Act, Right to Education, Forest Rights, Right to Housing, clean drinking water) has been converted into tangible rights, through the Supreme Court interventions including creative use of continuing mandamus. Successful implementation of the Right to Work, as contained in MGNREGA, is the most critical input for the realisation of social protection and living standards.
The Government of India must drop once and for all the fetish of repealing existing laws.
Another syndrome that is gathering momentum like a disruptive tsunami is the phrase “as may be prescribed” syndrome. And this virus afflicted the Labour Ministry quite acutely and must be cured.
Finally there is reason to believe that various workers' funds are being eyed for investing in the market. Given the history of NPAs, and the more recent history afflicting non-banking companies, and the most recent cooperative bank illness, we resist the desire to invest the life savings of poor people in order to promote speculative capital. Provident funds were invested in IL&FS which is facing huge financial crisis. Any investment have to be made in safe government bonds.
Another visible threat to social security comes from private insurance agencies including “intermediate agencies” that seek to use workers savings for parasitic speculation. We note that schedule V of the present draft even now talks of schemes that open the door for “agency or agencies that will implement the schemes” as indicated in serial no. 4 of the said schedules. We strongly oppose this move.
We conclude with the observation that above all, the poorest of poor eke out their living through multiple inhuman survival strategies, that require the highest social security protection, and not the other way round, as this Code sets out to do. Also if a robust social security is to be evolved in India, it shall require for a strong labour inspection and monitoring system, which must consists of principles of participatiory democracy, accountability and transparency.
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Click HERE for list of participants

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