The Silence of the Laws

Inter arma enim silent lēgēs (In the times of war, the law falls silent) is an age-old Latin maxim that several states across India seem to be vigorously translating into action in their ‘war’ against the COVID-19 pandemic.

While some states like Uttar Pradesh have taken the Ordinance route to make most labour laws inapplicable, some others like Madhya Pradesh have amended key labour legislation. States such as Gujarat, Himachal Pradesh, Punjab, Rajasthan and Uttarakhand have extended the maximum working hours and abridged the entitlement for overtime wages.

Creating gainful employment avenues for lakhs of home-returned workforce by attracting investments to boost the economy seems to be a plausible argument advanced in defence of the decision. Those who claim to tread a middle path seem to be against this decision in principle. However, archaic labour laws, they argue, were counterproductive for industrial growth.

It is also contended that in case we don’t ease the labour laws, we won't be able to encash upon the opportunity created by the flight of industries from China.

Untouchable

Informal sector workers account for 93% of the total workforce and it is estimated that only less than 6% of the entire unorganised sector workers have recourse to any form of social security cover. So, an overwhelmingly large section of the workforce remains untouchable by the labour laws.

Even in the organised sector, one must firstly examine if at all the industry cares to take cognizance of labour laws. The Centre for Monitoring Indian Economy (CMIE), an independent think tank of repute, estimates that more than 12 crore people lost their jobs during COVID-19. Of them, 27 million are the youth in the age group of 20-30 years.

Non-payment of wages and retrenchments made today are in the teeth of a host of legislation, most stringent of them all being an order passed by the Home Secretary on March 29, 2020, under Section 10 of the Disaster Management Act, 2005. Even in the wake of this worst human tragedy, that too when violation attracts imprisonment and exemplary fines, lakhs of employers have gleefully violated the basic legal obligation of payment of wages and have gone scot-free.

Do we, therefore, really need a formal annulment of labour laws at all?

Constitutionality

The government, in its obsession to owe the capital, does not seem to be examining whether protecting the workforce is an obligation exclusively emanating from labour laws. Policymakers seem to be forgetting the thematic edifice that labour laws have in our constitutional provisions. Almost all articles of our Constitution in the part relating to fundamental right (more specifically Articles 14-16, 19(1), 23-24) have labour protection at their heart; Part Four (Articles 38, and 41-43A) too, which has been held to be as sacrosanct as fundamental rights, concerns labour rights. Thus, whether by a mere easing of labour laws, constitutional rights can get subdued is to be examined.

International Obligations

India is a founding member (1919) of the International Labour Organisation (ILO). One of the first conventions that India ratified was the Hours of Work (Industry) Convention, 1919 (No. 1). Annulment of labour laws may be opposed to several international conventions and protocols that India has ratified over the years including the one mentioned above.

Even the backward nations have not amputated their labour laws in the wake of COVID-19. Sapping safety and security for income is sure to be deemed as retrograde action and will certainly impact India’s standing in the international arena.

Easing labour laws vs. doing business

A nation's ranking on the Ease of Doing Business Index is a function of these subindices: procedure, time and capital needed for starting a business, construction permits, getting electricity, property registration, credit, investor protection, tax regime, the enforceability of the contract, particularly, ones relating to debt and resolution of insolvency. The capital and their benefactors must seriously invest themselves to the thought as to why expunging labour laws is not one of of the subindices.

Even the Victorian-era laissez-faire regime has never profited the industries in true terms; rather it has augmented the schism at the workplace, enhanced trade disputes, and resultant litigation. Prudent management of industrial relations is one of the prime parameters for industrial success. The industry must not be naïve to neglect those workers. This benign industrial relation has a sound economic sense too within and outside the workplace.

Unless the vast workforce placed at the base of the societal pyramid is enriched, the overall purchasing capacity of the economy will never improve. This has been the founding philosophy of the Golden Age of capitalism that led to the constitution of the Bretton Woods twins in 1944.

Demand-side management

Much before the onslaught of COVID-19, the grave concern was of shrinking demand which will get worsened by the hire-and-fire policy. It will destabilise not just the workroom, but the overall economy in more ways than one. In its own interest, therefore, the industry must act to protect the workers and guarantee incomes, if not for the sake of moral obligation, sound economic logic.

Executive despotism

Removal of labour laws would mean amputation of a mechanism for dispute resolution, collective bargaining and compromise on safety and sanitation. All these are foundational for the existence of any civil society. The vacuum in the legislative sphere will be filled by the executive fiats. The legislature cannot be stripping itself of its essential functions and vest it to the executive.

Today, we are virtually living in times some would like to call an age of Executive Emergency. If the legislature, being the elected arm of the state, decides to defrock itself of its basic duties and welfare functions, it can hardly be deemed as a democratic rule.

Conclusions

Despite decades of independence, a disproportionately large workforce remains untouched by labour laws, welfare schemes or social security measures. Labour laws have their roots in the inalienable fundamental rights guaranteed under the constitution.

Legality apart, removal of labour laws will not revamp industrial growth. International experience shows that easing of labour laws has no bearing on the ease of doing business. Jeopardising the workforce on job and income fronts will destabilise the societal pyramid of demand and will further worsen the demand side economic woes.

The legislature of a welfare state cannot afford to absolve itself of its basic function of protecting its vulnerable sections.

The author is a Bengaluru-based Advocate practicing in the High Court of Karnataka.