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Central TUs Strike: LABOUR LAWS VS REFORMS, by Shivaji Sarkar, 4 Sept, 2015 Print E-mail

Economic Highlights

New Delhi, 4 September 2015

Central TUs Strike


By Shivaji Sarkar


The September 2 strike by trade unions has highlighted the problems of the workers and how they have been ignored over the years not only in deciding their wages but also some key elements that affect them the most - interest rates and taxes. The so-called proposed reform in labour laws calls for a relook.


The 10 unions, including the Bharatiya Mazdoor Sangh (BMS) stated to be close to the ruling BJP combine and which did not join the strike, have raised some vital issues of how the workers voices have remained unheard for the last two decades. One aspect that has softened the unions is the Government’s willingness to negotiate with them. The Government, they are happy, has not taken the strike as a prestige issue and labour minister Bandaru Dattatreya averred that the talks would continue.


The unions representing 15 crore workers have demanded raising the minimum wages nationally to Rs 15,000 per month. It seems to be a modest demand. A worker has to travel to his office, fend for his family, educate children and also pay for health care. The official ESI facility is not easily available for various reasons, one being their location. Can anyone have all these even at this minimum wage?


Prices, despite a fall in wholesale index, remain beyond their reach. With higher prices cost of conveyance has gone up. Health care is expensive. Workers and their families are unable to meet these expenses. They are unable to have minimum level of nutrition.


The bureaucracy does not feel that the workers need that much. They proposed less than half of it, Rs 6330, as the minimum wage. It is based on “calorific” needs. This was the major reason for the chasm between the unions and the Government. They were forced to go on a day’s strike to highlight their plight. The proposed slab is unsuitable for the workers as they would not be even able to fend for the minimum daily requirements. Striking a generous posture the Government increased the proposal to Rs 7098 per month.


They have some other demands as well and that included higher limit for bonus and correction in the provident fund system, social security coverage and non-interference in existing labour laws.


During the past two decades, the unions have raised their voices sporadically. They did not resort to industrial action except strikes in the banking sector on some occasions. The Economic survey 2014-15 is eloquent on declining mandays lost due to srikes and lock-outs from 17.6 million in 2009 to 14.46 million in 2011; 3.65 million in 2013 and 1.79 million in 2014. This exemplifies that the workers are keen on contributing to the progress.


The Economic Survey expresses concern on the deceleration in the compound annual growth rate (CAGR) since 2004-05 based on current daily status (CDS). It states that employment as per CAGR is as low as 1.8 per cent.


The workers have suffered immensely owing to job losses, denial of wage hike, unpaid provident fund and other dues and having one of the worst conditions at working places. The grievance redressal process of the labour department could not provide much succor owing to the laws that favour the employers and their machinations. Employers reportedly have not paid billions, if not trillion, of rupees of their dues.


As per official reports about four lakh workers lost job during the past about five years. This is supposedly in a regime where workers are “protected” by laws. If those laws are diluted one can presume that the future of workers would be bleaker. So why such “reforms” are being contemplated, the workers have been asking.


The Economic Survey 2014-15 says that the informal employment increased by 9.5 million to 435.7 million from 2004 to 2012. This means people are getting odd jobs, which are extremely temporary. The rise of informal employment also means that organized sector employment is coming down. This should be of concern to the nation as rate of labour force will continue to be higher than that of the population in 2021.


According to Labour Report (2007), 300 million youth will enter the labour force by 2025 and 25 per cent of the world’s workers will be Indians as the population would comprise of the youngest people with average age of 29 years compared to 37 in China and the US; 45 in Europe and 48 in Japan. 


The youngest population definitely requires a more caring nation. The low unsustainable wages are likely to create more problems.


The workers are also concerned that the Government does not negotiate with the unions on critical issues like income and other tax rates. Any tax is a burden on the working class. Though their wages have not risen, their contribution to the tax kitty both direct and indirect has increased significantly. The workers rue that they pay highest income tax of 33 per cent on total wages of Rs 22,000 a month and over 40 per cent of their wages go as various indirect taxes. The Government never discusses the tax issues with them though the industry is always consulted.


Lowering of interest rates is also impacting their savings. It helps only the ten largest borrowers who have pushed banks to Rs 3 lakh crore NPAs. An average depositor loses more because of loss in lowering of rates. The worker and retired persons feel that they are punished for saving and contributing to the nation’s growth.


Any cash they put in bank as savings is taken as an income and made liable to taxes. Savings on which they already have paid taxes attract more taxes and they rue that it is deducted by banks as tax deducted at source (TDS) without any rational. Most of the deductions are unwarranted and they have to shell out extra to chartered accountants to get a refund of illegal and improper deductions.


The nation moves on the sweat and blood of the workers. The shabby treatment they are meted out against the VIP treatment to government employees is leading to social chasm and disquiet. The past regimes had ignored this aspect. The NDA government has to prioritise and put the labour at the forefront for taking the nation ahead. It should call for a national discussion for equitable and sustainable wages with all stakeholders.---INFA


(Copyright, India News and Feature Alliance)

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