|Demand of the question|
Introduction. Contextual introduction.
Body. Discuss the Importance of Labour Laws. Various issues related to labour laws. Mention some measures to resolve these issues.
Conclusion. Way forward.
Labour Law means laws that regulate conditions and well-being of labour. Labour Law in a way define the rights and obligations as workers, union members and employers in the workplace. Labour law covers employment laws, administrative rules and precedents, Industrial relations, workplace health and safety, employment standards, working hours, unfair dismissals, minimum wage etc. which address the legal rights of and restrictions on working people and their organizations. India’s complicated labour law regime is in dire need of reform due to various issues.
Importance of Labour Laws:
- Labour Law is adapted to the economic and social challenges of India. It establishes a legal system that facilitates productive individual and collective employment relationships and therefore a productive economy.
2. It lead to labour welfare by providing a framework within which employers, workers and their representatives can interact with regard to work related issues.
3. It provides a clear and constant reminder and guarantee of fundamental principles and rights at work.
Issues related to labour laws:
- Complex law system:Under the Constitution of India, Labour is a subject in the concurrent list where both the Central and State Governments are competent to enact legislations. As a result, a large number of labour laws have been enacted catering to different aspects of labour e.g. occupational health, safety, employment etc. As a result, it created a lot of redundancy and loopholes in the legal system which paves the way to exploitation of labour. Implementation of this complex system of laws has also become a challenge to limited number of Labour Enforcement Officers in India.
- Labour exploitation: Because of the predominantly heavy handed labour regulations (also called as Inspector Raj) with exploitable gaps, the MNCs and domestic organizations have resorted to alternate ways i.e. employing contract labour at less than half the payroll of a permanent employee. India has 94% of its workforce in its unorganised sector. This huge workforce getting trapped in unorganised sector is largely attributed to our stringent labour laws. Thus labour reforms are needed.
- Impact of delay of labour reforms: The Labour Reforms if not implemented soon, it would take a gross hit on India as an investment destination. Also it would incur huge loss to the economy due to undervalued GDP production. This reflects the dire need for reforms. The data shows that 94% of Labour force in India is in the unorganised sector and that shows how grossly Indian GDP is undervalued. This is so because the income of these people in the workforce is very much less than the permanent workforce for the same output. The improper regulations coupled with complexity have led to misuse of vast Labour of India.
- Issue of contract labour:One of the main reasons for labour reforms is the concept of contract labour. Trade Unions suggest that this concept itself should be removed. There is stringent hiring and firing process defined in Industry Disputes Act. It makes it mandatory for the organization to seek Government permission before removing an employee.
- Issue of apprenticeship: Another major weakness in current labour reforms is less focus on apprenticeship. Our education system is not responsive to the needs of the market therefore apprenticeship becomes important.
- Simplification and consolidation of labour laws apart would be an important step in the process of efficient implementation of the existing laws.
- The government must focus on the key issue of job creation. While the proportion of workers in regular employment has increased, unemployment has reached a 45-year high. In such a situation, the government should be better off building a broader consensus on any major rule changes to existing worker rights rather than rushing through them for the sake of simplification.
- Labour being in the concurrent list of the Constitution, both central and state government legislate on it. But the State Governments have limited space to enact labour laws to address their own requirements, promoting investment and employment generation. It is in best interest of all to shift labour in State list.
- Strengthening of enforcement machinery is needed. Increased manpower, improved infrastructure is essential for effective implementation of labour laws.
- All India Service for labour administration must be formed that will provide professional experts in the field of labour administration.
- Contract labourers should be covered under workmen’s compensation act for accidents, with inflation linked wages and limited social security benefits from employee state insurance act and maternity benefit act extended to them
The road to a $5 trillion economy by 2025 is beset with many roadblocks, one being various labour issues. Government is trying to push various labour reforms like The Code on Wages, 2019. The Industrial Relations Code Bill, 2019 is another such effort which proposes to amalgamate The Trade Unions Act, 1926, The Industrial Employment Act, 1946 and The Industrial Disputes Act, 1947. Labour reforms are the need of the hour not only as a thrust on Make in India and ease of doing
business, but also to ensure the demographic dividend does not turn into a nightmare of
unemployment and under-employment.