With Parliament passing the three new labour codes that replace 25 existing labour laws, the present conjuncture officially marks the end of labour law as we have seen it for most part of the 20th century.
The codes substantially revise the pre-existing thresholds which were used to earmark the ambit of labour law enforcement; namely the size of an establishment’s workforce. The Industrial Relations Code, for instance, allows establishments employing up to 300 workers to layoff and retrench workers or close units without prior approval of the government; thereby pushing out a large section of workers employed in numerous medium-sized enterprises from the ambit of industrial disputes legislation. Earlier this threshold was 100 workers.
Likewise, the codes categorically double the threshold for the applicability of the Factories Act, 1948, i.e. from 10 to 20 workers in the case of establishments run on electricity, and from 20 to 40 workers in the case of units run without electric power.
Even the threshold specified in the Industrial Employment (Standing Orders) Act, 1946, by which an establishment with at least 100 workers was mandated to formally define employment conditions, has been enhanced to 300 workers. The Occupational Safety, Health and Working Conditions Code, meanwhile, increases the threshold limit of contractor-employed workers from 20 to 50 while allowing the hiring of contract workers in all areas, including core production.
In reality, these labour codes constitute de jure recognition of a wave of piecemeal endeavours by which state governments have been chipping away at key labour laws under the authority granted to them in the concurrent list within which labour falls. Periodic amendments to the Industrial Disputes Act, Factories Act, Industrial Employment Act, etc. by several states, as well as a slew of executive orders passed at the state and central level in the bid to attract foreign and domestic investment, are well known.
Of course, the bulk of amendments have concentrated on introducing self-certification of employers’ compliance with labour laws in small and micro industrial establishments, and the exemption of these establishments from the ambit of crucial labour laws. In 2014, the Labour Laws (Exemption from Furnishing Returns and Maintaining Registers by Certain Establishments) Act was amended to change the definition of “small” establishments so as to cover units employing a larger number of workers than the original piece of legislation. Now, with the Central Acts being modified and superseded by the new labour codes, the protection offered by the law to workers of larger establishments stands withdrawn.
In real terms, the essential thrust of the new labour codes is the generalisation of a paradigm of labour–capital relations, which is based on reduced state intervention or deregulation, and its corollary, bipartite industrial relations.
Importantly, the consolidation of this paradigm of deregulation marks a jurisprudential shift towards the more brutal, early colonial precarious labour conditions in which the state refrained from regulating work relations, using the logic that employer-employee relations are a private matter or private domain of social relations. In the global as well as the Indian context of burgeoning historical struggles of collective labour, a more interventionist role of the state in labour-capital relations became the order of the day since the 1920s, which culminated in the tripartite industrial relations machinery that persisted till the start of the liberalisation era of the 1990s.
However, with successive governments steadily withdrawing from regulation of contemporaneous industrial relations, the domain of the workplace is sought to be reduced to a private domain in which employers shall yield enhanced power to unilaterally fix wages, extract overtime, manage leaves, determine compensation, hire and fire, etc. Once inside the workplace, labour shall be under the blanket authority of employers. Given that labour inspection has shifted towards the self-certification system and third-party inspection by the employer, the private power of employers is all the more expected to grow with the enforcement of the labour codes. Henceforth, state intervention will be restricted to the use of the criminal law framework to curb labour unrest; a trend which is already rising.
The immediate consequence of deregulation is the generalisation of the highly oppressive paradigm of work relations typical of the informal sector. In the informal sector where a vast majority of working-class men and women are labouring in labour-intensive, lower-segment jobs, the absence of the state has nurtured the condition of quasi-magisterial powers of employers over the work contract. Now, of course, such enhanced private power of employers with respect to the work contract will be the norm across a large part of the formal sector as well.
This concerted attack on higher segments of the labour market shall have a spillover effect on the lower rungs where informal workers will be exposed to exceedingly higher levels of exploitation. The possibility of this is undeniable, considering what enhanced deregulation of work relations would mean in terms of periodic unemployment of higher skilled workers, who shall proceed to crowd lower-skilled, informal sector jobs. Subsequently, the existing informal workforce shall be compelled to negotiate their own survival through lowering of wages, longer spans of overtime, enhanced quantum of work, etc.
The rapidly unfolding context of deregulation, backed by persistent criminalisation of the labour movement, expunges the collective force of labour from ensuring the implementation of welfare legislation; thereby rendering the alleged extension of social security as unattainable for the larger section of workers.
This article first appeared in the print edition on October 15, 2020 under the title ‘Enslavement by law’ The writer is assistant professor, Delhi University, and a labour historian
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