The Trade Union Movement in India [TUMI], in the five decades since independence, has grown in size and structure. From a figure of mere 5000 at the time of India's Independence, the number of unions have grown to over 60,000 touching almost all the sectors of economic activities in India. It registered growth in the form of number of industries covered and establishment of its federations at the district, state and national levels as also industry specific national federations. The multi-party democratic system, also had influence on the nature and the size of the TUMI. From one Central Trade Union Organisation (CTUO), i.e. AI-TUC, at the time of independence, the number of recognized CTUOs have now grown to thirteen of which five [i.e. AI-TUC, BMS, CITU, HMS and IN-TUC] are major ones as they represent majority of the trade unions in India. The verified membership of CTUOs as announced in 1994 by the Government of India [GOI] gave a figure of 12.33 million as the size of their collective membership about 85.63 percent of which is contributed by industrial sector while agriculture and rural workers account for meager 14.47 per cent.

However, he TUMI activities in the post independence era has remained more or less confined to formal sector [FS], more so to the public sector enterprises – from where over 70 per cent of its membership is drawn. This may be because the state ownership on the one hand and unions’ closeness to political parties on the other hand has made unionization work easier in the public sector establishments. Thus there exist a mismatch between location of the workforce and unions' activities. Further although labour laws in India do not make distinction between the formal and informal sectors, yet the resources of the government and trade unions have been directed mainly towards workforce in the FS. Interestingly, this section of the workforce is already well protected. The real exploitation of the worker and his/her family takes place in the informal sector [IFS] where unions are conspicuously absent. The resultant lopsided growth of the ITUM has led to development of a situation where in one finds that it existence are least felt in areas where its services are most required while they are active in areas where employee are already adequately covered under various laws.

Since TUMI’s focus had been the workers in the formal sector, the mass of workforce engaged in the informal sector remained out of its areas of primary concern. Consequently, over 90 per cent of the workforce in the IFS remain unaffected by the activities of the workers' representative body. The workforce in the IFS remains unaware of their rights as workers and as such continues to be exploited by their employer (s). Many a times the exploited workers are not even aware of the employer's excesses. Long working hours, under payment, sexual harassment / abuse, physical confinement, etc. are day-to-day affaires. In an environment of helplessness the workers take these actions of their employer as fate [and rights in the case of employer or the master]. On the other hand the workers in the FS has been able to secure comparatively a better status and higher standard of livings.

Of recent, the process of liberalization, the international pressure as also the movement of workforce from formal to the informal sector, has generated renewed interests in the labour force engaged in the IFS. The government has repeatedly made announcement about its intention to focus its activities towards workers in the IFS. The current trends, however, do not speak well of the government’s intentions, as their preoccupation remains unaltered.

For long IFS have been domain of cooperatives and other non-governmental Organisation's activities. In the five decades since independence more so with effect from the 3rd Five year plan both NGOs and Coops have made significant contributions to the upliftment of the socio-economic life of workers in the IFS. They could be seen active particularly in rural part of India professing for the interests of workers such as, agarbatti workers, beedi and cigar workers, building and construction workers, domestic workers, forestry workers, handloom workers, home based workers, zari workers, etc. The trade unions too are trying to penetrate the IFS. Some impressive progress has been made in organizing the workers in Beedi, construction, fisheries, forestry, home-based workers, etc. industry. However, enrolling, a worker as a member ought not to be sufficient indictor of unions functioning particularly in the IFS. In the absence of wide spread networking of workers' organisations, one often comes across incidences of employer’s excesses on workers and government’s inability to provide necessary protection. In this connection the founding of the National Centre of Labour [NCL] in May 1995 as the apex body of the labour organisations functional in the IFS was a landmark development.

According to the data available, the workers forming part of the informal sector constitute 92 per cent of the workforce while those falling under the formal sector accounts for no more than 8 per cent of the workforce. Even in the formal sector there is a large segment of contract, badli, temporary worker that could be designated as belonging to informal sector. As such the percentage of workforce constituting part of the informal workforce could be much higher than what the data projects. Still, all the attention of the employers as also of government in the lastly five decades remained more or less focused to this minority section of the Indian workforce employed in FS.

The divided TUMI has nevertheless remained ineffective not only in reversing trend towards globalisation but also in securing benefits for the workers in the IFS. The conflict and mistrust intra and inter unions as also their non-focused approach that has always been part of the TUMI are probably the primary reasons for their current marginalized status. Consequently, the unions are distrust by the workmen, ignored by the government and disliked by the society at large.

One may then ask why had such a situation developed!

An enterprise comes into existence to economically produce goods and /or service. The goods are produced by using a combination of factors of production [land, labour and capital]. The entrepreneur, being the risk taker decides the proportion and manner in which these factors of production are to be used. This provided basis for a “give and take” relationship between entrepreneur [as employer] and worker [as an employee]. A worker agrees to render his physical and /or mental service in return for a just reward. The wages that the employer agreed to pay to the worker has to be at such a level that keeps into consideration the workers' need and the environment within which the worker lives. This agreement [whether verbal or written] between employer and employee is termed as a “contract”.

In entering into an agreement, the workmen expects 'decent work' environment and payment of due wages that would help him and his family to lead a 'decent life'. The employer on the other hand while expecting from workmen to diligently undertake the given tasks, has the responsibility to ensure payment of due wages as also decent work environment. Thus, promotion and maintenance of healthy and workable employer- employee relationship is the concerns primarily of the Employer and the Workmen. The need for involving government's authority arises only when either or both the parties decides to overlook the various provisions of the agreement/ contract and / or the statutory provisions enacted to this effect.

Contract:

A contract is a relationship between two or more individuals or parties under which a party agrees to perform certain functions under an authority of another party who in turn undertakes to provide the necessary resources and to pay the other party for the services rendered. The contract also implies that the contracting parties would respect not only the contents of the contract but also the laws laid down for the purpose. A contract could either be between two independent contacting parties wherein each party are placed on equal footing and are governed by terms of agreement. This form of contract is termed as “Commercial Contract”.

In the case of a contract between an employer and worker, workmen seek employment by offering his labour [physical and / or mental] while the employer bears ownership responsibilities and business risks. The authority to decide as to how a labour would be utilized also rests with the employer. However, this ‘master-servant relationship’ has the special protection under various laws enacted for the purpose of protecting the interests of both employer and worker. This form of contract is termed as “Employment Contract”.

Contract Labour:

According to the GOI the term "Contract Labour" refers to a situation in which the potential employer parcels out (work involving production of goods or services which is the normal business) to another enterprise usually at the lower cost of the first employer. The ILO also explains that the term "Contract Labour" is most often used to refer to a situation in which the substance of the relationship appears to be similar to an 'employment relationship' while the form is a 'commercial' one or at least where there seems to be some combination of employment and commercial aspects to the relationships established.

It relates to a relationship, direct or indirect, wherein a worker is contracted to render labour as and when required by the agency or individual that has entered into an agreement with the worker. Under the agreement [I] the form of relationship between the user enterprise and the concerned worker is that of independence and autonomy; and [ii] the substance of the relationship is nevertheless asymmetrical because of the dependency of the worker on the user enterprise, resulting from the worker's organisational and technical subordination to the user enterprise.

Accordingly, the Supreme Court of India in the case of Standard Vacuum Refinery Company vrs their workmen (1960-II-IIJ, page 233) has observed that contract labour should not be employed where: (i)The work is perennial nature and must go on from day to day; (ii) The work is incidental to and necessary for the work of the factory; (iii) The work is sufficient to employee considerable number of whole time workers; and (iv) The work is being done in most concerns through regular workmen.

The GOI has also enacted “The Contract Labour (Regulation and Abolition) Act in 1970 with the object to regulate the employment of contract labour in certain establishment. The Act applies to establishments and to contractors wherein 20 or more workmen are employed or were employed on any day of the preceding twelve months as contract labour. Further establishments in which works only of casual nature is performed do not fall with in the purview of the Act. The Act also does not apply to contractors who undertake supply of goods and articles of manufacture to establishments, such as wooden props to a coalmine, etc. However, a contractor engaged for ‘Job Contract’ or ‘Work Contract’ who is required to produce a given result for the establishment other than mere supply of goods and article for the manufacture is covered under the Act.

Contract labour system is generally restored to by the employer for reasons like uncertainty of work, difficulties in ensuring closer supervision by the higher employer or higher output by workers, cost effectiveness, flexibility in manpower deployment, concentration of core competencies, etc. Inferior labour status, lack of job security, and poor economic conditions are three major characteristics of this category of workers.

Categories of Contract Labour:

Job Contracting: A job contracting is one in which a person undertakes to produce a given result for the contracting firm through the contract labour, other than mere supply of goods and services of manufacture to such firms. Under this an enterprise contracts with an established firm for the supply of goods and services. The terms of payment are guided by the contract document, if any. The responsibility with regards to confirming with the provisions of laws applicable rests with the individual or the contract to whom the job has been contracted.

Labour Contracting: A labour contracting is the one in which a person supplies labour for any work of the contracting firm on payment remuneration or commission. The contracting firm through agent pays the contract labour. The responsibility with regards to confirming with the provisions of laws applicable therefore rests with the sub – contractor / agent who has supplied the labour.

It is of common knowledge that the contract labour are not given the same level of condition of employment including wages and benefits as are given to workers under regular employment of the firm. Various studies have studied condition of work as also living of contract labour and have concluded that the same is appalling and exploitative in nature. The conditions are worst in the case of workers employed in the IFS, as the supervisory machinery is more or less ineffective.

Perceptions of the Social Partners:

Like any other issues of the concern of labour, contract labour issue too has not received due attention of all the concerned parties. Over looking provisions of the Contract Labour Act and to that matter of the Supreme Court judgement is not uncommon. Every party gave its own reasons for failing to seek effective implementation of the legislative provisions. The government too doesn’t look committed to the concept as such one finds that the government departments and concerns are stumbling blocks. It would be interesting to have a look at the perceptions of the three social partners:

a. Government: The Indian Government is of, by and for the Indian people and as such has mandate to protect and promote the welfare of all the sections of the Indian society more so of the working class that is considered to be a weak party in the employer / employee relationship. Consequently, the Central and state governments have enacted about 200 labour laws covering practically all aspects of the workers life with object of ensuring just payment for the services rendered by individual workers, whether in formal or informal sector. However, much is needed on the enforcement side. Many of the laws are enacted in such a manner that it excludes majority of the establishments, e.g. the Factory Act, the Contract Labour Act, etc. becomes applicable to an establishment employing ten or more workers. The government labour administrative machinery too has been lethargic. Then there is time-consuming judiciary system making it almost impossible for the poor workers to get justice within one’s lifetime.

b. Employers: An employer is in business to make profit. To earn a profit, the entrepreneur endeaviours to maintaing gap between his costs of production and the products’ market price. He tries to maintain the gap through just or unjust means. Since he is incapable to influence the cost of capital, the entrepreneurs’ attention with regards to cost cutting had been on labour. The employer is able to do by not observing statutory provisions of the state and central governments. Employment of contact labour has been one of the important instruments of cost cutting for employers. Resultantly, there has been preference for contract labour among employers. According to them this system enables them to adjust workers component as per the demand cycle of his/her products. The fear of loosing job has also had positive influence on the workers’ productivity. Further the employers feel that the legislative protection has not only made labour untouchable but has also served as negative influence in employment generation.

c. Workers: Indian is a labour surplus country consequently worker is on the receiving side. Excepting the privileged few, the workers are at the mercy of the employers. In whichever industry one looks at there are a large number of workers employed on contract basis, receiving less than due return for the services rendered. They receive wages at times haft the salary of the regular employees Interesting fact remains that even in the formal sector there are a large number of contract workers employed under most exploitative conditions yet the unions, as the workers representative body, has been completing ignoring them. For Unions, contract labour is not their constituency thus leaving ground free for the play of employers’ whims and fancy. One of the reasons may be that unions as threat to regular workers consider the contract labour.

Clarifying Concepts:

There seems to be complete misconception of the conditions prevailing in the informal labour market. Trade Union’s approach towards the issue of contract labour too is misplaced. This demands clear understanding of the whole scenario:

From the viewpoint of the worker, he ought to be justifiably rewarded by employers who are enjoying fruits of his labour. A worker puts in all his commitment and labour in the production of a goods and services and expects that in return he be rewarded in such a manner that he is able to provide for the his and those of his family’s needs. For him contract or no contract document has little bearing on his level of sincerity in the performance of duties. When one looks at sectors such as agriculture, forestry, construction, etc. one finds a number of cases wherein a worker has been found to be working with the same employer for over ten to fifteen years but without any form of written document to prove the relationship between the two parties.

The Union being workers’ representative body ought to look at the issue from the workers view point and not try to shield themselves, like employers and government, through legislative provisions. For them each workmen has a right to get duly paid for the services rendered as also within the scope of the legislative provisions. WORKERS WAGES OUGHT NOT HAVE ANYTHING TO DO WITH COVERAGE OR NO COVERAGE UNDER THE ACT. The unions therefore should focus on issue of “Just rewards” irrespective of whether the relationship between employer and employee is formal or informal. If we accept this as a basis then it is immaterial whether the relationship is verbal or written, is of one day or of 35 years, is working in roadside dhaba or in a public / private sector undertaking.

The laws enacted by the state and the central government does not make distinction between workers formally employed from those who are not. It clearly states that minimum wages are to be paid as approved by the government for the various categories. The liability of the employers towards his employee is further clarify in terms of that workers are to be paid the approved wages, unmindful of employer’s financial stranding. An entrepreneur unable to pay due wages has no business to remain in business.

This implies that employers' have responsibility to pay due wages for the services rendered and decent work conditions irrespective of the nature and duration of agreement with the workmen. .


What trade unions ought to fight for?

The trade unions ought to work towards securing:

a. The payment of due wages without consideration to nature of agreement and/or size of establishment;
b. Decent work environment, particular in the informal sector and SSI; and
c. Social security coverage to each and every individual workers.


What needs to be achieved to secure the above Objectives?

This is not going to be an easy task particularly in the current industrial environment. Needless to say that both employers and government would oppose it or use delaying tactic. The high cost and inadequate size of administrative / supervisory machinery may be cited as reasons! However, the workers have waited long enough for others to look at their plight. It is time that ITUM must come together, like they had done recently to oppose certain anti-labour policies of the government, to work for achieving following objectives to alleviate the problems faced informal workers in particular by the contract labour:

1. Compulsory Coverage of all workers under some form of social security: In this regard each worker be given a distinctive Social Security Number.
2. Removal of all exclusion clauses from all labour law legislations thereby extending its applicability to individual workers
3. Enactment of a comprehensive labour laws with set time frame covering all workers in the informal sector;
4. Streamline state administrative machinery with exemplary punishment for slackness;

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