May Day Under Modi: A Distress Call From India’s 40 Crore Workers

Neither has the Modi govt been able to generate more jobs, nor has it been able to improve the worker’s life.

Image used for representational purposes.

(Photo: iStock / Altered by The Quint)

What has ‘Modinomics’ done for workers? If they were dreaming of achhe din, they’ve got a nightmare. The Modi government has not only failed on its promise to create more jobs, it has actually ended up reducing them.

The government’s own leaked report, held back on grounds of being unsound, says that unemployment is at a 45-year high. Data from India’s most respected private economic intelligence agency, CMIE, says employment has dropped from about 40.7 crore in 2016-17 to 40.1 crore in March 2019. That’s about 57 lakh jobs lost in the space of three years. RBI-KLEMS data shows a drop of 12 lakh jobs in the two previous years.

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What Happens When The Opportunity For Jobs Goes Down?

What happens when the opportunity for jobs goes down? Some people simply stop looking for work, while others take whatever they can. So, workers are forced to accept low-paid, short-duration contract jobs. Reports by ICRIER, Oxfam and the government’s own Annual Survey of Industries points to the explosion of contract work in the organised sector, over the past two decades.

Between 2000-01 to 2015-16, 44 percent of new workers were taken on contract. At the beginning of the millennium, two out of three workers were hired directly. Now, half of them are outsourced to third-party contractors.

When Narendra Modi was bidding for power five years ago, he promised ‘minimum government, maximum governance.’ It was an industry-friendly mantra that India Inc fell in love with. It promised easy loans, quick permits and hire-and-fire laws. And, the Modi government moved pretty quickly.

Work began on consolidating the myriad labour laws in the country into four labour codes. But, making big changes like these had to go through a lengthy parliamentary process. The BJP wanted to ‘Modify’ things faster. So, the first move came from the Vasundhara Raje government in Rajasthan.

Rajasthan’s ‘Experiment’ With Labour Laws

Labour is a concurrent subject and states have a range of laws to deal with working conditions and industrial disputes. The Rajasthan assembly, where the BJP had a four-fifth majority, moved to amend four key labour laws. The first change allowed factories with less than 300 employees, to fire workers without any prior permission from authorities. This reversed a 1982 law that had set the threshold at 100 employees.

Rajasthan also modified threshold limits to keep a larger number of units out of the purview of the Factories Act, which lays down rules for working conditions. Employers were also allowed to ask workers to do 100 hours of overtime per quarter, raising the work day to 10 hours and the work week to 60 hours.

Along with that, the ban on night-shift for women was lifted. Registering Trade Unions was made tougher. The number of workers needed to form a Trade Union was doubled from 15 percent to 30 percent.

How to Make Trade Unions Toothless, the BJP-Govt Way

Analysts wondered why a state, where less than 10 percent of workers are employed in industry, would lead the charge on labour-reforms.

It was, most likely, just a laboratory to test the industry-friendly labour laws that the Modi government at the centre was planning to introduce. This became evident as several BJP-led state governments followed the Rajasthan example and made similar changes to their labour laws.

Over the next few years, Team Modi brought the key features of these amendments to the Centre. The first of these was the Labour Code on Industrial Relations Bill, 2015, which combined provisions of the existing Industrial Disputes Act and the Trade Union Act. While the bill made registering trade unions easier, stringent reporting rules were added, which would allow unions to be derecognised as easily.

More importantly, the proposed law makes trade unions toothless, as it virtually takes away the worker’s right to strike.

Unions would have to give a six-week notice before a strike and if a strike were to be declared illegal, each member would face a Rs 50,000, fine and could also be sent to jail.

More Misery for Workers

When workers go on strike, they have to live without wages. At times like these, they depend on money collected by their unions and funds given by well-wishers, friends and family.

The new law proposes to punish anyone who gives monetary support to a strike that has been declared illegal. While there are identical harsh provisions against employers in case of an illegal lockout, it is much easier for a factory owner to fork out Rs 50,000 than for a worker living without wages.

While the government had to go slow on the Labour Code on Industrial Relations Bill due to opposition from the Sangh’s own trade union – BMS – it managed to pass laws that adopted the Rajasthan norms on 100-hours of overtime per quarter, and allowed companies in every sector to hire contract workers.

The Modi government’s labour and economic policies were supposed to make it easier to do business in India. Removing the so-called rigidities in labour laws was supposed to increase employment. While India has gone up in rankings in the ease of doing business, it is clear that it has neither helped create more jobs, nor has it made the worker’s life better.

For India’s 40 crore workers, May Day now means a distress call.

(Aunindyo Chakravarty was Senior Managing Editor of NDTV's Hindi and Business news channels. He now anchors Simple Samachar on NDTV India. He tweets @AunindyoC. This is an opinion piece. The views expressed above are the author’s own. The Quint neither endorses nor is responsible for them.)