Unraveling Labour Law Reforms for Migrant Workers in India

Unraveling Labour Law Reforms for Migrant Workers in India

This post is based on a recent article published in the Asian Studies Review. The article can be read here and is currently available open access to all readers.

In 2019-20, India underwent codification of 29 labour laws into four Codes. Our paper addresses whether the changing legal provisions benefit inter-state migrant workers under the new labour law regime. Using comparative analysis of legislations (labour laws and codes), we argue that labour codes are exclusionary for migrant workers. This socio-legal analysis is complemented with insights generated from a stakeholder perception survey across different states in India. The amended provisions indicate de-regulation and increasing informalisation of work, enhancing the vulnerability of migrant workers in transit and at destination worksites. In this blog, we briefly outline the context in which the changed regulations were enacted, a comparative analysis of the amended laws, followed by our conclusion about the impact of this regulatory transformation on inter-state migrant workers.

Migrant workers in India

Year after year, millions of India’s inter-state migrant workers endure the brunt of precarity, informality, and exploitation at worksites. Regrettably, they fall outside the protective ambit or legislative concern of lawmakers and government, in their home state and at the destination. A majority of migrant workers belong to historically vulnerable populations such as tribal (Adivasis) and lower caste communities (especially Dalits). The magnitude of their population is estimated to be in several millions every year according to different official statistics. Yet the exact figure is unattainable due to complex processes of circular migration which leads to definitional issues in the surveys conducted by the government. Migration in India has primarily been driven by economic reasons and lopsided development which is indicative of maldistribution of livelihood opportunities as well as failure of the market to absorb labour, exacerbated by the regional divide.      

From the home state to the worksite (construction sites, brick kilns, textile units,  small-scale industries, etc.) inter-state migrant workers face a slew of issues. There are established informal migration corridors from labour surplus region to region with more demand for labour (industrial establishments, metropolitan cities, and agriculturally advanced areas). They are recruited (and travel) mostly via contractors (but without written contracts), and often do not even come into direct contact with the employer for negotiating terms of employment. The worksites where they are usually employed are of a small scale, having little to no protection or recourse in case of exploitation, violence, or injury. Their working conditions are precarious, often hazardous/dangerous, without any proper gear or equipment, without social security, are at risk of being trafficked, and often coerced into forced labour. Due to falling rates of inspections, migrant workers rarely come into contact with any government officials.

The COVID-19 pandemic led lockdown exacerbated the vulnerabilities of migrants, visibly exposing the absolute lack of any kind of social or economic protection. The exodus was likened to the Partition of India, wherein millions of migrants walked several hundreds of kilometres to their homes. Living in political denial by the government for decades, the codification process only showed a rational policy ignorance towards migrant workers as the new labour laws were passed with minimal discussion or debate in the Parliament, particularly during the initial phase of the COVID-19 pandemic.

Transitioning Legislative Framework and Policy Regime: Laws to Codes

The rationalisation and harmonisation of labour laws was meant to be a step in the right direction, due to the various overlapping and diverse sets of labour laws. The streamlining of labour laws brought about wide-ranging changes in regulation and protection. This included the sole legislation for regulation and protection of migrant workers, i.e., the Inter-State Migrant Workmen Act 1979 (ISMW Act), which was amalgamated into the Occupational Safety, Health, and Working Conditions Code (OSH Code). 

The ISMW Act was poorly implemented, and remained a dead letter. Workplaces and contractors were not registered with the Labour Department, and migrant workers were not provided proper documents as mandated by the Act. Migrant workers suffered from exclusion at destination states as most welfare policies or social protection measures carry domicile restrictions. Nevertheless, in principle, the Act was a step towards ending the exploitative practices of contractors and providing protection to migrant workers.

While strengthening the legal ecosystem and enhancing protections for migrant workers might have been the policy prerogative after the visible exodus of migrants, the labour codes that were introduced represented a step in the opposite direction. The Codes seek to make it easier to run a business, rather than protect workers. The overall push is to make compliance less cumbersome for businesses. This may lead to further informalisation of the workforce at large, particularly in the case of migrant workers. 

Reducing Applicability

The OSH Code has increased the threshold of applicability of the Code to worksites employing 10 or more inter-state migrant workers. This means that inter-state migrant workers in establishments employing less than 10 inter-state migrant workers are not entitled to any protection under the Code. In addition, according to the Sixth Economic Census (2016), only 1.6 percent of establishments employ 10 or more workers (including non-migrant workers) in the non-agricultural sector, indicating that the OSH Code is applicable to only these establishments. Consequently, the overwhelming majority of worksites (99 percent), especially those employing inter-state migrant workers, are left unregulated. This will make workers vulnerable and unprotected, as mere victims to the ever-present reality of exploitation and neglect.

Removing Accountability

The Act had a provision wherein every migrant worker was supposed to have a passbook for easy tracking of wage payments, including identification details of the worker. In a case where Rakesh (Name changed; migrant worker from Balangir, Odisha) was not being paid his full wages, the passbook came in handy to claim his unpaid wages. The passbook acted as a tool of accountability and was a safeguard for migrant workers in case of non-payment or partial payment of wages.

In the name of easing regulation, the Code does not require a passbook and removal of this provision may lead to possible exploitation of migrants by businesses. In cases of unclear terms of employment and withholding of wages, the absence of a tool such as the passbook, it becomes virtually impossible for the worker to make their claims or substantiate them for any form of relief.

Added to the passbook, each contractor was to obtain a detailed license from the Labour Department as per the Act. The license contained various details such as terms and conditions of the agreement under which workers were recruited, wages payable, hours of work, and workers’ details. The Code, on the other hand, merely requires the license to specify the number of such contract labour and the amount of security to be deposited by the contractor. This again indicates reducing regulation to the bare minimum, which will not be usable in case of violation.

Dwindling Protection

Worker protection has eroded further due to the removal of the labour official’s specific power to inspect and examine any worker to ascertain if the person is an inter-state migrant worker. This provision came in handy during the ISMW regime but found no space in the Code. A District Labour Official (from Uttar Pradesh) interpreted this omission as a weakening of their powers and duty to inspect. Coupled with extremely low rates of inspections, an increasing policy push for easing regulation via self-certification signals a virtual free-for-all in the realm of Indian industry, wherein firms can set-up, self-certify and administer worksites without being inspected by labour inspectors.

The change is not limited to the powers of a labour official, but extends to their nomenclature as well. The labour inspector is now ‘labour inspector-cum-facilitator’ heralding a new era of labour relations, where even the official empowered to take action is now transitioning to a ‘facilitator’ between workers and employers.

Reform or Retreat? The Shift Towards Informality

Enacting such structural reforms in an economy requires preceding positive economic performance with growth, stability, distribution, and most importantly institutional renovation. This happened in several developed countries, even after 2008 global financial crises led labour market changes. However, policy decisions in India have often been populist in character rather than deliberative.

The labour codes aim to informalise labour relations in existing organised units, although the ideal case should have been the opposite. The mainstream neo-liberal rationale of a free worker in a capitalist economy being the most efficient faces a defeated logic in this case, where the state is pushing informality in order to boost business. The contemporary functioning of capitalist system seems to work very well with unfree forms of labour, and in fact, thrives upon it. Global capital penetrating local markets via subcontracting and labour reforms such as this leads to the blurring of boundaries between formal and informal sectors. The Indian state has acted as an ally of global capital by facilitating this reform. The State abrogating itself of responsibilities to protect its workers, who are the backbone of the economy, and denying migrant workers security and protection under this new regime is tilting the balance of power in the favour of capital as opposed to labour.

Feature image: Photo by Pop & Zebra on Unsplash

Ishaan Bamba is an independent researcher. Kunal Munjal is a Senior Research Fellow at Indian Statistical Institute, Bangalore and Ph.D. candidate at IIT-Hyderabad.

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