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There has been talk for some time about easing labor laws, already seen in industry circles as too rigid and acting as an obstacle to growth, specifically to facilitate those who come out of the blockade. And it’s not just about getting out of there, there’s also the problem of surviving what appears to be a brutal and protracted global economic recession. It was reported Friday that ordinances were being issued in some states.
Obviously, there is little room to doubt that it will take some time for the world to emerge from the blow it has suffered. Economists have agreed on one thing: until we know how long the pandemic will last and in what form, it is not possible to predict how long it will take for the global economy to begin to approach something that looks like business as usual. We still don’t know if there will be numerous waves, what will happen in the winter, etc.
Archive image of migrant workers waiting to board a special train in Gujarat. AP
These uncertainties are crucial to the issue of relaxing labor regimes to help boost the economy in this country, as elsewhere, especially in the United States, where a virtually unimaginable rise in unemployment is driving draconian solutions in some states.
In India, one of the key changes devised has been to allow an increase in the working day from eight hours to 12 and the working week from 48 to 72 hours. It had been reported in the second week of April, even in the first phase of the national closure, that the Center was considering amending the Factories Act of 1948 to allow this.
Although the Center has not yet followed up on this, several states have already issued notifications under the provisions of the Factory Law, increasing the workday of factory workers to 12 hours.
By April 21, Gujarat, Rajasthan, Punjab, and Himachal Pradesh had done this in chronological order. Whereas Punjab, Rajasthan and Himachal Pradesh had provided for overtime to be paid at twice the rate of pay as prescribed by law, but Gujarat had expressly provided for additional pay at the normal rate. Haryana did the same at the end of the month, stipulating overtime pay under the law.
The first four states had stipulated a period of approximately three months for the new regime, while Haryana specified a two-month “amnesty”. We will return to this point. At first glance, these ordinance Factories Act amendments suffer some legal ‘illnesses’, despite the fact that a provision of the Act itself, Section 65 (2), allows state governments to make exemptions from daily and weekly hours. and weekly holidays to help factories deal with “exceptional work pressure.” Possible problems with the ordinances include a separate section of the Factories Act that prohibits increasing the workweek to more than 60 hours, including overtime work, and the fact that the enabling section does not allow for modification of the provision (Section 59) for payment of double the ‘normal’ rate for overtime (see here).
Although the unions protested in a memorandum to the government, there have been no reports that these notifications have been challenged in any court or tribunal. But far from legal issues, there are issues of convenience, optimization, and fairness. The eight-hour day was first won by workers in the aftermath of World War I, in the context of desperate attempts to increase productivity. Several studies at the time had found that a reduction in frequent long working hours (and better pay) actually increased productivity.
Ford was one of the first major companies to adopt the new hours, in 1918, increasing productivity and doubling profits in two years. After the war, several countries passed laws that limit working hours and require workers to receive other benefits, including better working conditions. In India, the existing Factory Law was amended in 1948 to limit working hours and to require worker safety.
The reduction of the working day to eight hours is not only a matter of workers’ rights, but also of the physical and mental health of workers and, from a purely practical point of view, of productivity, which promoted labor reforms, such as It was mentioned in the first place. It is unlikely that workers will be forced to work shifts that are one and a half times existing. It had been said in defense of the measure that this will help manage factories with the participation of fewer workers. Given the travel restrictions and the difficulty and inadvisability of putting large numbers of workers in hastily arranged housing, this seems reasonable, provided these measures are of limited duration, for example three months.
But now several states plan to introduce relaxations that are designed to last longer, for years. These are questionable. Uttar Pradesh has said it will pass an ordinance that will suspend labor laws regarding wages, hours and welfare provisions for three years, although the form of the exemptions has yet to be clarified. Madhya Pradesh has issued an ordinance amending two state laws to achieve more flexible labor regimes. Many restrictions do not apply for 1,000 days for startups. Gujarat said on Friday that new industrial companies would be exempt from some labor laws for 1,200 days, more than three years.
That there is a crisis is obvious. It is also obvious that industries, especially those in the medium, small and micro sectors, will need assistance in various ways to get out of the shutdown and the tide during the period that will be unfavorable for companies. What is questionable is granting general immunities for long periods of time, citing current demands.
It would have made more sense to grant immunities for shorter periods and extend them as needed. It could, and has been, argued that rigidities in labor regimes should be removed anyway. This is an issue that must be established, on merit, through public debates that involve those involved or interested. The current crisis should not be treated as an opportunity to avoid legitimate debate.
Chambers of commerce reportedly suggested to Union Labor Minister Santosh Gangwar in a webinar on Friday that labor laws should be suspended for two to three years, except those related to minimum wages, bonuses and other legal fees. , and the increase in working hours to 12 per day to help the industry face the current crisis.
Neither one seems reasonable because, as argued, the latter is unlikely to be an efficient long-term solution, especially once lock restrictions are removed and mobility is no longer a problem, while the other prolongs exceptional remedies beyond demonstrated needs. At least for the moment.
Finally, there is the question of asking “people” to make sacrifices. Care must be taken to ensure that the poor, who already bear a disproportionate share of the “social” burden, should not be asked to make even more disproportionate sacrifices to overcome a crisis that disproportionately affects them in any case.
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