The growth of the country may well be riding on the frail shoulders of the ubiquitous contract worker who is increasingly being favoured over regular workers. Contract workers now form a quarter of the workforce in the country. The number seems to be increasing daily if quarterly labour surveys of the government to assess the impact of the recession are to be believed.
For the worker, it does not mean anything other than more labour. It usually means poor wages and an existence in a grey area where no labour laws on entitlements exist.
In fact, the Contract Labour (Abolition and Regulation) Act of 1970 seems like a mistake of the distant past. The law was about restricting contract labour to certain core activities. But such distinctions are hardly made. Contract labour is so popular in industry that the law seems out of place. Hence, the government is thinking in changing the law itself.
The new law will try a new strategy: Putting contract labour on a par with regular labour. Minister of State for Labour Harish Rawat recently said the law was being made only to tackle the evils that come with contract labour.
But what are the evils faced by contract labourers, who comprise 26.49 per cent of the total workforce, according to the National Sample Survey of 2005? At Allied Nippon, where an executive was killed by angry workers last week, the 900 contract workers earn a fraction of what the regular employees get. Many have been in service for decades and still were being threatened with dismissal. A worker in the bonding department, for instance, earns Rs 12,000 per month, while the contract worker doing the same job gets Rs 3,200. The contract worker puts in 12 hours, while others work eight hours.
For the former, there is no employment provident fund (EPF), no health insurance under the ESI scheme and no leave, according to the workers. In another factory in the area, workers said they worked 12 hours all seven days of the week and were paid Rs 3,000 per month.
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An attraction about hiring contract workers is that they can be dismissed at the management’s whim. But many of these so-called plus points are against the country’s labour laws. The law provides for ESI, PF and bonus benefits for contract workers. The law does not say that contract workers can be made to work 12 hours every day and denied leave. What is missing is a machinery to ensure that the workers are not deprived of the entitlements promised under the law.
Now, the government is promising a new law so that it will no longer be attractive to hire contract workers for the wrong reasons .
The Indian Labour Conference, which has representatives from employer groups, worker groups and the government, will take up the issue at its annual meeting this month for the second consecutive year.
But the big question before all bold legislative steps is whether they can be enforced or monitored. Rawat would hear none of this. Having a law giving equal rights to contract workers is the best way to protect them against exploitation, he says.