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Whither reforms? Pandemic 'witnessed' poor labour market governance in India

By Simi Mehta 

Eminent labour economist and professor, Human Resources Management Area at XLRI -- Xavier School of Management, Dr KR Shyam Sundar’s new book titled ‘Essays on COVID-19, Labour Market Reforms and the World of Work in India’, released at a virtual event, has been dedicated the book to the premier international academic body (co-founded by former President Shri VV Giri), the Indian Society of Labour Economics.
In the context of Covid-19, the induced pandemic, and the recent labour reforms, the Impact and Policy Research Institute (IMPRI), and the Xavier School of Management organized the book discussion as part of the IMPRI series with the Centre for Work and Welfare, "The State of Employment #EmploymentDebate as ‘Impact of COVID-19, Reforms and Poor Governance on Labour Rights". The event was organized by the Indian Social Institute (ISI), New Delhi, Working People’s Charter and Counterview.
The book provides a critical analysis of the impact of the policies, laws, government regulations issued concerning workers, especially the migrant and informal workers, the poor labor market governance, and labor law reforms on labor rights in a Pandemic-struck economy in India.
It comprises essays providing a commentary on the contemporary developments during the Pandemic-hit period 2020-21 concerning migrant workers, unorganized workers, labor rights, complete failure of the governance of the labor market, the Labour Codes that were hurriedly enacted by the Union government and regional labor reforms measures.
It also discusses the responses and strategies followed by the trade unions. The book not only critically analyses the contemporary developments but also provides valuable recommendations based on the people-centred ILO approach. It is published by the well-known publisher, Synergy Books, India.
In a formal web function the book was released by Prof D Narasimha Reddy, Professor of Economics (Retired), University of Hyderabad in the presence of Prof Babu Mathew, National Law School of India University; Prof Praveen Jha, Centre for Economic Studies and Planning, School of Social Sciences, Jawaharlal Nehru University (JNU); Ramapriya Gopalakrishnan, International Labour Organisation (ILO) consultant and a leading labour advocate, Chennai; and Dr Radhicka Kapoor, Senior Fellow, Indian Council for Research on International Economic Relations (ICRIER), New Delhi.
Talking about the book release, Prof KR Shyam Sundar said:
“Ever since the introduction of economic reforms in 1991 in India, employers, and critics of labor regulation have argued for the introduction of reforms of the labour laws and the inspection system. They demanded codification of labor laws and the introduction of employer-friendly reforms in the process. The Central government irrespective of the parties in power is committed to labor laws reforms, more so the NDA government. On the other hand, the trade unions have stridently argued that in the era of globalization job losses have become rampant, the quality of jobs has deteriorated considerably, and hence demand that labor laws need to be universalized and be effectively implemented.”
The Covid-19 pandemic has wrought the worst possible havoc both on the lives and livelihoods of people in all the countries. However, the adverse impact has landed far more severely on the vulnerably placed informal and unorganized workers, people below the poverty line, and thereby exacerbating existing inequalities in the economic system. ILO strongly recommended a four-pillar approach is a comprehensive and balanced approach arguing for designing policies and measures based on social dialogue to ensure employment generation, income, and social protection, and workers’ rights and support to the firm. But the tale of policy-making in India during the Pandemic does not conform much to the healthy perspective of ILO.
“My book is based on the fundamental premise that labour institutions and social dialogue are indispensable for promoting sound labor market and industrial relations policies that would at once protect both employers’ and workers’ rights and concerns, especially during the crisis-ridden crucial time such as the one we are facing now”, he said.
 Prof Shyam Sundar underlined:
“Had the government consulted the social partners is not only designing a comprehensive policy architecture to provide relief even life-saving measures especially to the small enterprises and informal workers but also in their delivery, had the government and other agencies implemented even a fraction of the even conceptually defective labor laws concerning the unorganized and the migrant workers, had the government consulted global organizations like the ILO, UN, and academics in tackling the workers’ woes, the play of pandemic in the lives of these millions of distraught workers would have been better."
When unemployment as per the Centre for Monitoring Indian Economy (CMIE) data has been stubbornly hovering around and over seven percent, is it not worrying that India does not have a macro level unemployment allowance/insurance scheme even for the workers in the organized sector?
During 2007-2017 a total of 10,728 workers availed unemployment benefits under the stringent Employees State Insurance (ESI)-covered unemployment scheme which means an average claim of 978 workers per year! Will we see a repeat of poor labour market governance witnessed during Covid-19?
Such a question arises because we are witnessing inordinate delay in taking corrective measures such as creating a comprehensive database concerning migrant and unorganized workers and framing policies and creating governance mechanisms. The Draft Migration Policy was released just recently and the Labour Bureau is set to launch five employment surveys which though covers migrant and domestic workers strangely leave out workers in the emerging sectors like the gig and the platform economy, informal professional service providers.
These are welcome measures but there is no credible gestation plan for implementation of them. The whole tragic story of workers’ rights is the shoddy or non-implementation of even the meagerly legislated rights. A comprehensive database work and employment are essential for devising universal social protection which would help better implementation of the four Labour Codes.
When 68.4 percent of workers in the non-agricultural sector work in the informal sector, about 70 percent did not have written contracts, more than half of them did not have paid leave and any social security (Periodic Labour Force Survey [PLFS] 2018-19). Given the extreme precarity of the workforce in the non-agricultural sector which unlikely to have reduced (in fact precarity would have been intensified thanks to Covid-19), the resurgence of Covid-19 poses serious and grave concerns for workers in particular and society and economy in general.
More worryingly, the pandemic period witnessed undue haste in the enactment of the three Labour Codes and the passage of several unilateral and highly questionable legal measures and the unveiling of structural reforms like privatization and Foreign Direct Investment (FDI)-easing measures. 
Worsee still, the lessons of the pandemic disasters have not led to the formation and implementation of governance reforms concerning the delivery of legally mandated reliefs to the migrant and the unorganized workers. We are witnessing Covid-resurgence and the hurt-shy migrant workers have begun their second wave of reverse migration.
Firms and workers alike are apprehensive of a potentially more severe if not a macro lockdown. In the absence of a macro unemployment benefit or insurance scheme and social security, at least Then, what is the meaning of the passage of the four Labour Codes when the historic governance deficits are still prevalent? Eventually, the passage of the Labour Codes remains more symbolic given that implementation goalposts are being delayed.
The lack of social dialogue, absence of Federal dialogue (Labour Ministers’ Conference or other appropriate federal consultations), and the unwillingness of the governments (both the Central and the state) to consult ILO for technical support in drafting the regulations would not only delay the implementation of the Labour Codes but could potentially result in poorly conceived and drafted regulations.
The lessons of the Covid-19 strongly call for the abdication of fiscal conservatism and frame a comprehensive and durable social assistance comprising direct benefit transfer as economists across spectrum and trade unions have been urging the government to extend, urban employment guarantee scheme (at least during the Covid-19 period) and strengthening of Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS). Lives and livelihoods are at risk once again and this time around the government must be wise as must be the people lest the damage to both the economic and social fabric of India will be severe.
Employment and work are the surest cures to both unemployment and poverty which are sure to haunt the people during Covid-19. However, Indian democracy is sturdier and its pluralistic approach is still dynamic and it is with hope I see distinct possibilities of “corrective actions” both inside the Parliament and Assemblies and outside. It is important that workers feel safe and that involves more than gestures and indirect actions like infusing liquidity in and providing no-collateral soft loans to firms, people and street vendors in the economy.
Welcoming the academics and the participants Dr Arjun Kumar, Director of IMPRI, observed:
“The author has demonstrated his versatile ability to weave the challenges in the labor market, existing industrial relations in India as well as the push factors for happening the labor reforms in the country. His insights and advocacy for ensuring decent pay and social security for the ASHA and Anganwadi workers and them to be accorded the status of ‘workers and government employees’ speaks volumes about his passion for concretizing dignified labor rights for all in India as per the standards laid down by ILO. This book is a must-read book for anybody who is interested in the concept of rights and justice for humanity.”
While releasing the book, Prof D Narasimha Reddy commented:
“Here is a book that tells you the precariousness of the migrant and informal workers during the pandemic COVID-19 due to the conscious failure of the state and the apathy of the judiciary. In much more detail it exposes the deficits of the reforms emerging in the shape of the Four Labour Codes."
Dr Radhicka Kapoor observed:
“India’s labour regulatory framework has witnessed substantial changes over the last year from the introduction of the four Labour Codes by the Central government to the relaxations and amendments made by several state governments to key labor laws. Prof Shyam Sunder’s compilation of essays not only provides a systematic exposition of these changes but also critically analyses each of them, the various shortcomings, and how these can be addressed."
One of the biggest challenges that India faces today is that of creating ‘good jobs’. Having a clear understanding of the nature of labor laws required to accelerate the pace of productive job creation is imperative. Prof Shyam Sunder’s lucid writings help us navigate the labyrinth of India’s labour regulations and understand how we can move closer to this goal.
Importantly, he urges us to expand the horizons of the debate on the subject beyond the narrow agenda of “flexibility” to issues like a minimum set of decent conditions of work and wages to all workers and a minimum basic level of social security.
Speaking on the occasion, Prof. Babu Mathew said:
“I commend this book of Prof Shyam Sundar to serious students of labor studies: One must carefully read both the explicit message and the one between the lines to decipher the glaring and I'll inform swing of the Indian State towards Ease of Doing Business while grossly neglecting core labour standards and decent conditions at work for the impoverished millions.”
Prof Praveen Jha said:
“Prof KR Shyam Sundar has been a major scholar of Industrial Relations in India and has a substantive body of work to his credit. The current book focuses on the context of the COVID 19 pandemic and its implications for the world of work. It consists of his short and incisive pieces on the devastating impacts of governance and policy failures during the pandemic on livelihoods of the working people in general and multiple deprivations they have been subjected to. Prof Sundar has chronicled these with care, empathy, and an eye for detail while providing a persuasive analysis. It is a fine balance that the book offers in terms of description and powerful insights. I recommend it as a must-read for those interested in the subject.”
Ramapriya Gopalakrishnan observed:
"The book is a must-read for anyone interested in understanding: the impact of covid-19 on the lives of workers in the country and the changes in the labor law landscape in the new normal world. I commend Synergy Books for bringing out such a book and also the author for his excellent writings."

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