Labour Reforms - Tiger and Palm Tree

One of the contentious issues that is going to come up in the coming months is labour reforms. Many wonder why the present government did not bring this in the first year of its first term. Bibek Debroy, Chairman, Economic Advisory Council to the Prime Minister, in Mint a few days back (27 May 2020) outlined nine measures required to reform the labour laws in the country. Briefly, these are as follows:

All labour laws should be unified, not just those administered by the labour ministry.
The wall between formal and informal must be broken down. Our inherited labour laws
didn’t anticipate the advent of services.
An employee is an employee, regardless of whether s/he is formal, “part-time”, “work from home” or “migrant”, and must have rights. There must be a system of registration of employees, and incentives for it, perhaps through Aadhaar numbers.
A similar registration for employers as well as contractors employed by them.
Though labour is in the concurrent list, recognising state-wise differences, Central legislation should cover the basics, maybe even with just a model law.
As amendments take time, legislations should not be open-ended, be limited in time to about 25 years, and details left to be notified through rules.
As employment contracts are bilateral contracts, which stipulate different conditions, obligations and remuneration, including productivity-based incentives, there is no need for an all-India legislation covering issues such as bonus which vary across States, industries, etc.
Why not put the onus of safety not just on a particular company but on collective, industry-wide, or cluster-wide efforts. Similarly, look at alternatives for social security measures.
Employee associations should registered, and be at the enterprise level.

Of course, all these require further deliberations. This will involve rationalising and reducing the current labour legislations from 40-plus to three or four. And, of course, a tenth point would be the need to cover migrant labourers to be treated on par with other labourers, with separate provisions to take care of their special needs. Lack of data on migrants is a reason why the government is not able to have targeted welfare measures when they suffered during the current lockdown.

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