Labour law changes in UP, MP a bigger pandemic in the offing: BMS President

Labour leader C K Saji Narayanan
Trade unions are upset over a proposal by the states of Uttar Pradesh and Madhya Pradesh to exempt businesses from a set of labour laws in order to boost investment over the next 2-3 years. RSS-affiliated Bharatiya Mazdoor Sangh national president C K Saji Narayanan tells Somesh Jha in an interview that the country needs bureaucratic reforms instead. He says the states are under an illusion that investments will move from China to India. Edited excerpts:

What do you think of the labour law reforms introduced by Uttar Pradesh and Madhya Pradesh?

This will lead to a law of the jungle. Rule of law is a characteristic of every civilized society and any area exempting from the rule of law will lead to a ‘jungle law’. Uttar Pradesh (UP) and Madhya Pradesh (MP) are creating a situation where there will be no rule of law and the two parties (employers and employees) will have to settle the course on streets as the Industrial Disputes Act of 1947 has been withdrawn. Safety will be compromised as the provisions of the Factories Act will no longer be there. A paltry amount of Rs 80 which goes into a welfare fund per worker every year in Madhya Pradesh will no longer exist.

What is your future course of action of the trade unions?

We will discuss the issue with our office bearers in both the states and also in other states that are planning to undergo similar labour law changes and decide upon the course of action in next few days. We will surely agitate and protest.

Do you agree labour laws need to be reformed?

What’s the emergency to make these reforms? These can very well be discussed in a tripartite forum where industry, workers and government can sit together. These are against the International Labour Organisation conventions ratified by the Indian Parliament. The conventions have become the law of the land and won’t sustain legally. Once the Parliament ratifies these even the state governments cannot do anything. It will surely become a big issue in the ILO which will issue a show-cause notice to India. Already, India has been put to trial for doing away with the inspection system in the proposed labour codes some years back. The Indian government had to take a step back and re-introduce the provisions terming inspectors as inspectors-cum-facilitators in the proposed law. Probably, the advisors that have drafted these aren’t aware of these developments.

What can the ILO do?

The ILO can impose sanctions on India as it is a specialised agency of the United Nations. So far, Myanmar has been the only country on which sanctions have been imposed by the ILO in its history of over 100 years.

Are you more concerned about the changes made by UP than in MP as most labour laws have been proposed to be written off?

We are equally concerned. Both the states have exempted industries from labour laws for around 3 years. MP government has withdrawn most of the provisions under the Industrial Disputes Act. This is a new pandemic coming to India which will spread to other states and perhaps more dangerous than the the coronavirus. Like coronavirus has followed us from China, this disease is also coming from that country.

What is the need of the hour in terms of reforming the labour laws?

India requires a bureaucratic reform. Red-tapism is the biggest hurdle in the ‘ease of doing business’ and not labour laws. Our bureaucrats continue to follow the practices of the British era.

But the industry and economists say that labour laws are also an impediment to investment…

The World Bank was also of the same belief till 2009 when the drooped the idea. The 10th item in the Ease of Doing Business was related to labour but this was subsequently dropped. How can human beings be a hurdle to investment?

There is an argument that labour laws have led to informalisation in the labour market. Your comments?

Laws are meant to formalize and not informalise. No industry will make good with five people, if it requires 10 workers. But it’s the bureaucratic maze that creates the problem and the industry eventually shows less people on its records to stay away from the labour laws. We do agree that inspectors are corrupt to some extent but is it a problem only when it comes to labour laws? Why not withdraw inspection related to customs or excise? Or why not do away with police inspectors, too?

How do you suggest more workers can be brought in the formal sector?

Employment generation means congenial atmosphere for starting business. The biggest advantage that China had was not that you can start a business in 24 hours but the fact that within 24 hours, you will know that you can start your business. In India, you have to run from pillars to post first to get a bank loan then to register yourself it will take another few months and to get a license, it will take more time. After doing all this, you will get to know after one year that you were never eligible to start a business. Now, it’s also true that the minimum due diligence has to be done. You cannot give a factory license to a person without knowing if the firm is technically qualified to handle the machinery or chemicals and this holds all the more significance with what has happened in Vishakhapatnam.

Why do you think the labour reforms of this kind have been initiated by the BJP-ruled states? Do you think it gives them comfort that the same party is also in the Centre?

The Union labour and employment minister told us a couple of days back in a meeting with trade unions that no labour laws will be introduced through Ordinance but through the ordinary route. They had no intent to change these laws through this route. It’s happening because of a so-called competition between the states as they are living in an illusion that companies will quickly shift base from China. Companies will instead run to Vietnam and Taiwan because they operate on similar lines as China where human rights have no value. India is a strong democracy and you cannot compromise on labour laws in this manner. These changes will be challenged in the courts, too. They know trade unions cannot take to streets right now.

So do you feel that the governments have been taking advantage of the pandemic to introduce these changes?

Employers have been demanding these changes even before the pandemic as our economy was witnessing a slowdown and manufacturing growth was slumped. They are trying to fish out of troubled waters in these pandemic. That’s why one after the other the industry bodies are praising these moves.

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel