Sayan Chandra and Shailendra Shukla; both Second year students of Gujarat National Law University, Gandhinagar scrutinize the Ordinance temporarily suspending the labour laws in the States of Uttar Pradesh, Madhya Pradesh and Gujarat in the midst of Covid-19 pandemic.
The coronavirus pandemic, which took the entire world by storm and has brought the global economy to its knees, has shown no signs of stopping. It has been recently warned by the WHO that the virus may be here to stay, in the absence of a vaccine, however with the lockdowns getting over in different nations, it is being assumed that the virus may be a complementary part of the daily lives. Wuhan, the capital of the Hubei province of China, is assumed to be the epicentre of the Covid-19 virus. Owing to the unprecedented crisis which originated from China, global manufacturers have now started looking down South to shift their supply chains to India. India, like every other economy, has suffered major setbacks due to the imposition of an early nation-wide lockdown, which reaches nearly seven weeks as of today.
Hopeful to kick-start its economy past the flattening of the coronavirus curve, the Central and State governments have already begun to implement actions that seek to attract investment by fostering the ease of business in the sub-continental territory. As a result, three Indian states have relaxed labour laws, ostensibly to minimise red-tapism and bureaucratic inefficiency, which may deter potential investors from relocating from China. However, such actions come at the cost of infringing the fundamental rights of blue-collar workers and daily wage labourers who will now be subject to inhumane working conditions with minimal protection offered by the legislation. The authors, through this submission, seek to analyse how the implemented relaxation of labour laws may adversely affect labourers, and examine the legality and need of the ordinances issued.
WORKER RIGHTS UNDER THE SCRUTINY OF THE ORDINANCE
Uttar Pradesh, Madhya Pradesh and Gujarat have temporarily eased labour law to boost investment and job growth. Touted as a necessary measure by its proponents, this move seeks to alleviate and push India out of the growth slump it was experiencing before the advent of the pandemic. As per the Ordinance issued by the State of Uttar Pradesh, only 3 out of 38 labour laws will prevail for a period of 3 years. These include the Building and Other Construction Workers Act, 1996, Workmen Compensation Act, 1923, Bonded Labour Act, 1976 and Section 5 of the Payment of Wages Act, 1936.
Indian labourers are already severely exploited and it is imperative to realise that these legislative actions have effectively minimised employer liability with respect to worker exploitation, and have, in fact, paved a clear path which will accentuate the same. For example, The Industrial Disputes Act and The Trade Unions Act, both were envisaged to be legislative guarantees for the workers to voice their concerns and complaints will become dormant. Factories will also be exempted from The Minimum Wages Act, which mandated governments to fix minimum wages payable to employees and The Equal Remuneration Act, which ensured equal pay for equal work for women. Perhaps the most concerning is the exclusion of The Factories Act, 1948 which regulated the time put in by the workers has been relaxed, and the most obvious consequence of it will be an increase in working hours. With it being watered down, employers have no obligation even to provide toilets or basic water drinking facilities to workers.
THE VALIDITY OF THE ORDINANCE: A CONSTITUTIONAL EXAMINATION
While the opposition has slammed this move left to right and centre, there also remains a question as to whether an ordinance can be used as a tool for such suspension of laws, especially central laws as well including the Provident Funds Act and the Industrial Disputes Act. Further, the entry of industrial and labour disputes is Entry 22 of List III of concurrent List, Wherein a central law, i.e., the Industrial Disputes Act, has been suspended by the Ordinance.
Hence, quite in accordance with the constitutional process, the Ordinance has been reserved for the assent of the President under the provision of Article 213 (1)(a) as well as (3) of the Constitution of India. It is mandated under these articles that Ordinances which requires the assent of the President to be declared valid, such ordinances by the Governor has to be mandatorily sent for presidential assent. This required constitutional mandate is available under article 254 (2) which carves out an exception to the principle of repugnancy laid down in article 254(1) with respect to matters in the Concurrent List. Article 254(2) provides that the State can make a law repugnant to the Central law for matters in the Concurrent List only if the President approves the same.
However, apart from the competency of the state legislature spearheaded by the Governor in cases of Ordinance making power, there can be further grounds of challenging the viability of the Ordinance.
1) In the process of fostering the economy, the Ordinance has suspended important rights of equal payment, payment of minimum wages, maintenance of working conditions, maternity benefits which flow from article 21 itself and which cannot be suspended even at times of emergency. Further, the lockdown being not synonymous to a proclamation of emergency, the suspension of rights of protests and functioning of associations like the trade unions also curb their rights under article 19 cannot be done except for maintaining public order. This is because public order is one of the only applicable restrictions under article 19(3)-(4) in such a situation. Such an act would have been justified only if public health was mentioned as a limitation to the rights under article 19(1)(b)-(c).
While one can argue that these rights are not suspended per se, but the statutory laws furthering such rights being suspended indirectly hamper such fundamental rights and hence falls within the vires of Part 3 of the Constitution.
2) The period of 3 years for suspension of laws which is mentioned in the Ordinance can be held to be arbitrary or an un-calculated move. It is needless to reiterate that such a long period of suspension would severely hamper the labour conditions in the State. It may also result in a complete industrial rule in the State with the industries being left out of the shackles of the labour law. Further, the length of time as to when the issue of spread and effect of coronavirus will be continued is still undetermined and hence the term of 3 years can prove counterproductive as well!
3) It is required to be clarified that this Ordinance will not be applied to employees under the Union Government functioning in Uttar Pradesh as they are regulated by the Union List Entry 61. This is because the State cannot suspend any legislation which it does not have the authority to make. As the states do not have the authority to legislate on any matter in the Union List.
Another concern being raised is that the matters being in the Concurrent List, will the central law come into force on a point about which the state law is suspended? This calls for the interpretation of the term “existing law” in article 254. The term as defined in article 366(10) means any law or Ordinance which has been passed by the authoritative legislature. Hence the definition does not require that the law should remain in force at a given point of time to be termed as “existing law”. Therefore, the State has taken a wise decision by suspending the state laws which does not bring the Central laws in force. Though such an act may be wise in the eyes of a quasi-federal parliamentary democracy, still it falls short of the ideology of social and economic justice, which is deeply ingrained in the Preamble and thus our Constitution.
CONCLUSION: THE DILEMMA
The main dilemma which is reflected in this Ordinance is that which is existent worldwide, that is, to promote economy over individual health and civic needs or vice versa. Running the utilitarian reasoning of the greater good principle in India would be indeed going against the constitutional approach of socialism and the idea of a social welfare society. It is undeniably the need of the greater society to further economic growth in the post-coronavirus period to generate employment, for more cash flow, to generate revenue and ultimately to prevent the State from slipping into anything close to economic depression and preventing our GDP from a downward fall. But simultaneously it is also necessary that these labourers and workmen who have suffered the most due to this extensive lockdown don’t suffer more post the lockdown, as that would lead to civic unrest further hampering the economic growth.
A middle ground is indeed the need of the time, a sustainability-oriented step where the ease of doing business needs to increase but not at the cost of basic rights and protections of labourers and workmen. Steps of fast-tracking judicial disposition of cases and suspension of institutional processes of closures and strikes should be prevented, but simultaneously there can be the composition of a grievance redressal committee to solve issues through mediation and negotiation while avoiding judicial settlement and institutional breakdown of business establishments as much as possible. The complete suspension of labour laws is indeed not the best step legally or socially at the moment.
Sayan Chandra and Shailendra Shukla are Second Year Law Students at Gujarat National Law University, Gandhinagar
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The Employees’ Provident Funds And Miscellaneous Provisions Act, 1952, No. 19, Acts of Parliament, 1952 (India).
The Industrial Disputes Act, 1947, No. 14, Acts of Parliament, 1947 (India).
India Const. sch. VII, List III, Item 22.
Id. art. 213.
Id. sch. VII, List I, Item 61.
IMPORTANT – Opinions expressed in this article are the sole responsibility of the author and do not necessarily reflect the views of IJOSLCA.