#labor reforms

Frances Elizabeth Caroline Willard (September 28, 1839 – February 17, 1898) American educator, temperance reformer, and women's suffragist.

बुनियादी सुधारों का साल रहा 2020: अहम सुधारों से GDP ग्रोथ डबल करने में मिलेगी मदद, लेकिन पूरा असर लंबे समय में दिखेगा

Ads से है परेशान? बिना Ads खबरों के लिए इनस्टॉल करें दैनिक भास्कर ऐप 34 मिनट पहले कॉपी लिंक ग्रोथ को मौजूदा 4-5% के लेवल से 8-9% पर ले जाने में कृषि कानून, लेबर कोड, नई शिक्षा नीति और स्वामित्व स्‍कीम का बड़ा हाथ होगा सुधारों से मौजूदा व्यवस्था में उथल-पुथल मचेगी, लेकिन उससे धीरे-धीरे उसकी क्षमता और उत्पादकता, दोनों में बढ़ोतरी होगी इकोनॉमिक ग्रोथ को मौजूदा 4-5% के लेवल से डबल करके 8-9% पर ले…

According to Niti Aayog, the government's think-tank that replaced the planning commission, labour reforms are needed to induce productivity and create jobs in the market. The report on labour importantly suggests unifying 44 labour laws into four central ones. The reforms mooted by a panel headed by Arun Jaitley, the Finance Minister, offers an overview of development activities as part of a three-year draft action-agenda.

The logic behind the labour-reforms stems from challenges relating to industrial relations, establishing commensurate wages, social-security and safety for labourers as well as adopting a global labour code. Reforms in labour laws, or centralizing labour codes would also provide a fillip for investments in many sectors, besides reducing the burden of compliance.

Several workers union went on a strike on the 2nd September 2016, demanding the government to raise the minimum wage for unskilled laborers at par with minimum wage paid to skilled laborers. Earlier the minimum wage for unskilled non-agricultural workers in non-urban areas was Rs.246; now it has been raised by the union government to Rs.350, and minimum wage for unskilled agricultural labor in non-urban areas has been increased from Rs.211 to Rs.300. All we can say is, it's a welcome decision in the right direction, but it's not enough.

Many different arguments were coming from various sections of the society. Some argued that you cannot treat skilled and unskilled labor from the same perspective. Some others argued that if minimum wages increase then, commodity prices will also go high. It's needless to say that these arguments were coming from those who consider themselves part of the skilled or highly skilled labor pool with their concerns centered just around their income and expenditure. They are not people taking home a couple of hundred rupees after a back-breaking work of 9-16 hours a day, neither do they remain empty handed when the rest of the society enjoys a holiday break. So we don't need such so-called intellectuals arguing for their class superiority and self-centered economics to guide us on minimum wage. This is a serious issue, which often gets swept under the mat or kept aside to be considered later on. If we have a genuine debate on it, the can of worms it will open up will show that this wage disparity is a forced one, thrust upon the weaker sections of the society by all those who want a comfortable existence, exploiting unskilled laborers as slaves, whose labor is often bought with petty cash.

Two key arguments on minimum wage

Should difference in skilled, unskilled or highly trained labor be a factor for deciding minimum wage?

Education remains central to determining and distinguishing these work forms, apart from that family engagement makes some adept in handling various crafts. Primarily those who lack both these avenues to enter a skilled form of work are those who take up unskilled or semiskilled labor to mete out their livelihood. It does not mean that rest others in the society are not using their work. But even though the community uses their labor it is unwilling to consider that they too are individuals who deserve better income and living conditions.

Although everyone is part of a value chain, where only productive hours of labor should matter, we have created privileged categories within labor. If some hundreds of people are using a certain brand of software, are there not hundreds of people fed every day through farm work? Tasks like road laying may not involve extraordinary decision-making, but it can be more cumbersome and draining because it involves hard physical labor, monotonous in nature and poor working conditions. The struggle involved is more than any skilled form of work enacted in a relatively better working environment.  

On one side we talk about alleviating poverty and uplifting people from poor conditions, but on the other hand, we are not willing to part with workers a decent wage, which can make them self-sufficient to look after their needs.

Excess profit of an enterprise is nothing but labor outcome of its workers

Let's say an automobile mechanic who has an overload of work decides to hire an employee. He doubles his productivity with his additional laborer. From the profits earned, he pays a frugal amount as salary to the worker and retains the rest of the money for himself, which is nothing but a labor outcome of the newly hired laborer. Even after subtracting costs incurred to the service station of the automobile mechanic, which is now a micro business with one more worker in addition to himself, the excess profit that he retains is nothing but the strive of the laborer. If this is the case with a micro business unit, it's needless to say that the profits accrued by small, medium and large business are nothing but labor outcome of all its workers. Even an employee should know that the wage given to him is nothing but the result of his personal hardship in the form of labor, not some special grant provided by his employer.

When both skilled and unskilled workers are indeed co-workers in production, the class disparity between them should cease to exist and difference in minimum wages too. And minimum wage should not be based on whether the form of labor is skilled, unskilled or highly specialized. Basic needs of individuals and families are factors independent of their work forms. How can we say a skilled laborer should get Rs.18000 as a minimum salary and Rs.10000 should be enough for an unskilled worker? We are talking about minimum wages. It is the fundamental right of anyone who is engaged in any form of sustainable (productive) labor for stipulated hours.

Will commodity price go high if minimum wage for unskilled labor sees a rise?

Are those who are arguing that commodity price will go high if the minimum wage is raised expecting that the burden of keeping costs low should rest on the shoulders of unskilled workers? Let's know clearly; they don't have enough money even to look after their individual and family needs. Should we not ask the heads of businesses, who are accumulating enormous wealth in the name of profits bear the responsibility of keeping costs low? Who should part with their income to keep the prices low? Why is there no debate on capping salary and profits to bring down the costs?

The argument put forth by those in the upper realm of business, and economic strata are, any measure to cap salary or profits will affect the growth of firms and can also discourage enterprises from hiring more people. But the result of increasing minimum wage can be the other way round also. When there is more disposable income with a laborer, his purchasing power and consumption rate will go high, and it will give fresh impetus to the economy. The apparent loss what the elite are talking about is the profits they get to hold back. It legitimately belongs to the workers. They should be giving them back to the workers by capping their own salaries and profits. Unfortunately, we have made excess profits look like a legitimate outcome of any business operation. It's rampant in our society today, and we can see it in every business domain. For example, the profit a builder earns from the labor of scores of workers is several times higher than what he gives out as a collective wage to his workers. But propaganda mills of ill-informed industrial society presents unskilled workers' demand for minimum wage as an unsatiated greed.

If the society thinks that unskilled labor forms are tasks meant for lesser beings, perhaps we should make everyone skilled and disengage people from such tasks. But are we ready to do them ourselves? Since there is a definite need even for unskilled labor, let's treat such work with equal dignity and remuneration that will allow the workers to lead a decent life with some surplus income to save.    

All those who are arguing that any rise in the minimum wage of unskilled labor will result in higher commodity prices should know costs are the rise only because businesses are not willing to cut down their profits. The onus is on the industry, which has been lobbying against raising the minimum wage. Enterprises which are engaging unskilled/skilled laborers with poor remuneration, but flaunting their corporate social responsibility for the sake of propaganda should know that charity begins at home. If they can distribute their excess profits to their workers, the living conditions of millions of workers across the country will see a phenomenal rise.