Labour Rights or Economic Recovery? – A New Dilemma amidst the Pandemic

Labour Rights or Economic Recovery? – A New Dilemma amidst the Pandemic

By Ishita Nayak

Covid 19 came as a surprise to India almost after 100 years of the Spanish Flu. We might have come far in the race for development. However, Covid 19 was something for which the entire world was unprepared and it made us realise that howsoever powerful the countries may have become but when it came to a crisis like Covid-19, they all lost the battle before this pandemic. When the entire country was grappling with the effects of the Coronavirus, the state governments found it more convenient to suspend labour laws. These steps were taken to ensure economic recovery which was severely impacted due to months of lockdown. This move will not only cripple the economy but also those dependent upon it precisely; the working class. 

This unprecedented situation has brought changes in almost every aspect of life, whether social, cultural, political or economic. All of us have made attempts to adapt to this pandemic and its effects, while it was easy for some sections of society to do so, the working sector was left in chaos amidst the period of lockdown. Although it was crucial to minimise market disruptions and stabilise the effects of Covid 19 on the economy. The government needed to understand that these disturbances couldn’t be fixed by simply suspending labour regulations and depriving the working class of their social security benefits. Various state governments like Uttar Pradesh, Maharashtra, Madhya Pradesh and Punjab have decided to suspend most of the labour laws in their respective states to curb the effects of the lockdown and to incentivize investment and employment. 

This is in fact a contrary step when viewed in light of the UN’s commitment to minimize the layoff by way of subsidies. These so-called law reforms have failed to capture the interest of the working class and it seems as if Covid-19 is being used as justification by the government to implement incomplete reforms, such as lengthening working hours and lowering wages to the bare minimum, as well as cutting social security benefits. What is interesting is that India has ratified the Tripartite Consultation Convention of the ILO, which aims at ensuring the long-term stability of the stakeholders in terms of stability and development. The state governments have failed to realise that these ordinances are in direct violation of this benchmark convention.  

Apart from conformity with ILO’s objective, it is also important that whatever reforms or laws are brought to transform the landscape of the labour industry in India, also be consistent with the constitutional values and principles. Indian constitution by way of conferring multiple rights through Part III (fundamental rights) and IV (Directive principles of state policy) safeguards the interest of the workers. With the suspension of labour laws in India, there would be a plethora of rights that would be taken away from the working class like the right to form associations or unions under Article 19(1)(c), the fundamental right to live a dignified life etc. 

The popular opinion considers labour as a constraint in bringing investments and growth. However, research and data from surveys reveal another reality it is not the labour regulations but electricity, corruption and tax rates which are more bigger constraints for investments and growth of the business and industry. The government will try to legitimise these measures as important to kickstart the crumbling economy and bring in more investments, however, it is pertinent to take note of the fact that it is not labour laws rigidity that affects investment flows, but aspects pertaining to ease of doing business.

Moreover, while these changes may be meant to support economic recovery, the ramification of their implementation can be quite severe. Suspension of these labour laws amidst a global health crisis like Corona has made the working class more vulnerable to risks of bondage labour, lower working wages and lack of social security benefits. In situations like this, when the government ought to step in to help the populace, it is instead depriving them of the essential relief that they could need in an emergency. The migrant workers experienced challenges because they were put at the mercy of a system with little social protection, not because of the pandemic or the ensuing shutdowns. Adding to the already worsening condition, the suspension of the Industrial Disputes Act, of 1947 would also deprive the working class of having easy access to justice since whatever grievance redressal mechanism the act provides would also be suspended. 


Although the suspension of employment laws and other similar measures made in this regard is justified to encourage investment and support the economy, the government’s actions run contrary to the reason for the existence of labour laws in India, in the first place. Even if the situation is exceptional and requires uncalled-for measures, the aim should be to ensure protection and not. India, in this regard, has taken the opposite step. Suspension of labour laws to sustain the economy is no better reason to gamble away with the lives of millions of workers. The government should re-assess its policy in light of the latest developments but at the same time, it should not lose sight of the fact, that such measures are in breach of worker’s constitutional and human rights and therefore stands no justification on any basis. 

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