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The plight of workers belonging to the unorganised sector has been engaging the attention of successive governments since independence. Their bane is that they are unorganised. They are bereft of economic and social security. Their work places are scattered and fragmented with no defined employer- employee relations. Lack of resources, low skills and absence of stable and durable avenues of employment are some of the other afflictions they suffer from.
The First National Commission on Labour (1966-69) defined unorganised labour as those who have not been able to organize themselves in pursuit of common objectives. The Commission alluded it to casual nature of the employment, ignorance and illiteracy etc. Nearly 20 years later, the National Commission on Rural Labour (1987-91) visualized the same scenario and the same contributory factors leading to the present status of the unorganised labour in India.
According to NSSO estimates the total employment in the country has risen from 374 million in 1993-94 to 397 million in 1999-2000 (based on Usual Principal and Subsidiary Status). Out of this, around 28 million are in the organised sector and the balance 369 million in the unorganised sector. About 60% of the labour in the unorganised sector are engaged in agriculture and allied activities. They constitute small and marginal farmers, landless agriculture labourers, share croppers etc.
The welfare of these workers is one of the major priority issues that the United Progressive Alliance (UPA) government led by Dr. Manmohan Singh is addressing. Listing its priority in the Common National Minimum Programme, the UPA said that “some changes in labour laws may be required but such changes must fully protect the interests of workers and families and must take place after full consultation with trade unions.” Reiterating its firm commitment to the “welfare and well-being of all workers, particularly those in the unorganised sector who constitute 93 per cent of our work force”, the NCPM said that the social security net would be expanded.
In the absence of a universal legislation for providing social security to unorganised workers, the Ministry of Labour set up from time to time Welfare Funds for five specific category of unorganised workers. These workers include Building and Other Construction Workers, Beedi workers, Cine workers and certain categories of non-coal mine workers. These funds have been helping the specific category of workers in health care, housing, education of children and providing for social security like pension and insurance cover.
Welfare of Beedi Workers
There has been an effort to increase the coverage of some of these welfare funds and new initiatives taken to liberalize and improvise various schemes. For example there has been a steady increase in the expenditure on welfare of poor Beedi workers which has risen from around Rs. 50 crore in 2000-01 to Rs. 88.88 crore in 2004-05. To meet the additional requirements of funds in this regard, the rate of cess levied on manufactured beedis has been enhanced from Rs. 2/- per thousand beedis to Rs. 4/- per thousand beedis from April, 2005. The increase will facilitate an additional Rs. 70 crore to Rs. 75 crore per annum towards the welfare cess. In order to improve the healthcare of Beedi workers and their dependents, provided at present through 4 hospitals and 206 dispensaries all over the country, 3 more hospitals are nearing completion. Further, to encourage expansion of existing hospital facilities exclusively for Beedi workers, the Central Government has initiated a new scheme for providing a one-time grant of Rs. 2 crore to State Governments or any other institution for this purpose. In addition liberal reimbursement of medical expenditure is provided for specialized treatment of serious ailments. Women beedi workers enjoy maternity benefits. Group Insurance Scheme is being run for Beedi workers for which they are not required to pay any premium. The housing scheme for construction of houses by Beedi workers has also been revised and liberalized. The subsidy available to Beedi workers for this purpose has been doubled to Rs. 40 thousand per unit and eligibility norms relaxed including increase in wage ceiling from Rs. 3,500/- to Rs. 6,500/-. These changes are applicable to non-coal mine workers also.
However any effort to improve the lot of unorganised sector workers would be incomplete without bringing in agricultural workers, who constitute majority of unorganised workers, within the ambit of welfare schemes. Attempts to bring them into the social security net on pilot basis have not proved successful. ‘Krishi Shramik Samajik Suraksha Yojana’ launched by the previous NDA government in 2001 is one such case. The issues and problems of these workers are complex. Seasonal employment, large scale migration, lack of formal employer-employee relationship and lack of resources for funding welfare measures have been some of the contributory factors.
Workers’ Welfare Bill
After a prolonged public debate on the recommendations of the Second Labour Commission, the Labour Ministry has proposed a draft ‘Unorganised Sector Workers’ Welfare Bill – 2004.’ It has been circulated among social partners, experts and state governments to elicit their views on it. The proposed draft Bill provides for setting up of Unorganised Sector Workers’ Welfare Board at the Centre. The Board would be required to advise the Government on policy matters relating to employment, social security, safety and welfare of workers. It would also advise the Government on regulation of employment in unorganised sector and formulate schemes on pension, health and medical care, employment injury benefit, maternity benefit, group insurance and housing safety. The Board would also formulate schemes and review their implementation and recommend to the Central Government the changes required from time to time in such schemes. Provision has been made in the draft Bill for setting up of similar Boards by the State Governments.
Another important component of the draft Bill is setting up of Workers Facilitation Centres. These Centres would be responsible for registration of unorganised sector workers and of employers of different categories of such workers. In addition these Centres would provide a social security number and an identity card to registered workers.
The draft Bill envisages a contribution of 5 per cent of monthly wages by the workers for the welfare fund and the matching contribution by the employer, in whose absence the contribution would be made by the appropriate State Government. The Central Government would also contribute an amount not exceeding 2.5 per cent of the monthly wage of each registered worker.
Identification of unorganised workers and funding of welfare schemes has been one of the major stumbling blocks in setting up welfare funds for unorganised workers. Experience has shown that the welfare schemes mostly dependent on contributions of unorganised workers and their employers have not been able to sustain. Keeping this in view and drawing upon the recommendations of the Second Labour Commission, the National Advisory Council (NCS)has recently forwarded the draft of a proposed ‘Unorganised Sector Workers’ Social Security Bill-2005’ to the Government. The Draft Bill intends to address the requirements of the social security system for unorganised workers, which would be administered by a National Social Security Authority for Unorganised Workers. It, inter-alia, propose to redefine “worker” so as to include all types of unorganised workers in the definition of workers and to provide them with social security including healthcare, insurance, maternity benefit and pension. The draft Bill seeks to reach the workers through Workers Facilitation Centres to be set up and supervised by the Facilitating Agencies which could include Post Offices, Cooperative Societies, Micro-Finance Institutions, Trade Unions, District and Village Panchayats and Urban Local Bodies.
Funding of Welfare Schemes
The most important feature of the proposed draft is in funding of the welfare schemes. It proposes to levy a cess or an appropriate tax by the Central Government to partly finance the schemes, programmes and projects for the welfare and social security of unorganised workers. The other sources of income would be the registration fee of the workers and grants and loans by appropriate governments. The floor level schemes of social security propose to have atleast components of insurance, medial care, sickness benefits, employment injury benefit, maternity benefit, old age pension and survivor’s benefit.
All these measures reflect the Government’s resolve to fulfill its commitment to the workers belonging to the unorganised sector . Nevertheless, there should not be any unnecessary delay in seeking the Parliament’s approval. Enactment of law in this regard would be very big and a historical leap forward in the labour history of the country. It will considerably improve the lot of these workers, majority of whom belong to weaker and marginalised sections and are living below the poverty line. Sooner it is done, the better.
*Deputy Principal Information Officer, PIB, New Delhi
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