Govt approach to social security to unorganised sector workers is welfare and not rights based


After years of deliberations, the Government of India has circulated a draft social security code, a key labour law proposal that seeks to amalgamate a clutch of existing laws and proposes several new initiatives including universal social security for unorganized sector workers. Besides, it also proposes corporatization of existing organizations like EPFO and ESIC headed by people other than the labour minister.

Currently,  India’s social security laws are applicable only to the organised sector because the Unorganised Workers’ Social Security Act, 2008, has been poorly implemented. Excerpts from a critique of the existing Act by Kathyayini Chamaraj, Executive Trustee, CIVIC Bangalore:

Right of workers to social security has been recognised as an inalienable right and, therefore, must accrue to every worker. Provision of social security is mandated in our Constitution under Articles 38 (securing a social order for the promotion of welfare of the people), 39 (certain principles of policy), 41 (right to work, education and public assistance in certain cases), 42 (just and human conditions of work and maternity relief) and 43 (living wage etc.) of the Constitution of India as a part of the Directive Principles of State Policy.

The issue of providing social security to the unorganised sector workers has been vexing workers and civil society since long.  The response of the government has been at best welfare and not rights-oriented, tokenistic and splintered. An Unorganised Workers’ Social Security Act was passed in 2008 to provide social security to all the unorganised sector workers, which instead of integrating and rationalising all splintered Acts and schemes and making one comprehensive general law, has merely become one more such Act.

First of all, it confers no rights and is only an enabling law.  It merely says that States may devise schemes for providing social security to unorganised workers.  It does not cover all workers or make their registration compulsory as in other countries.  Even for those covered, their inclusion at least in a ‘minimum social floor’ of benefits, if not all benefits, is also not mandatory.  It does not ensure a mechanism by which workers can be incrementally covered and fixes no time-frame within which all workers will be covered.  It has prescribed no means of creating a fund from which benefits can be drawn.  The Karnataka Rules continue to prescribe incremental coverage of workers sector by sector which approach has been shown to fail in enhancing coverage in the other such sector-based schemes and is actually not required under the Act.

Limited coverage of workers:  Workers already covered under the six schemes listed under Schedule II of the Act in the organised sector are ineligible for coverage under the USWSSA.  These schemes are the ESIC Act, EPFO Act, the Maternity Benefit Act, the Workmen’s Compensation Act, the Industrial Disputes Act and the Payment of Gratuity Act. However, the Act makes workers in the organised sector who are not covered by any of the Acts mentioned in Schedule 2 eligible under the USWSS Act.

But the USWSS Act sets further conditions by saying that only those, either home-based workers, self-employed workers or wage workers, working in establishments that have less than 10 workers are covered under the Act.  Among those again, those earning more than an amount of monthly income fixed by the State governments are ineligible to come under the Act.  Moreover, a list of 43 sectors has been identified by the State Board as coming under the unorganised sector in addition to those covered by the definition of the unorganised sector in the Act.

The Act requires States to fix an income limit to determine eligibility.  Karnataka has ruled that only those workers with BPL cards from the Food & Civil Supplies Department are eligible under the Act.  It is to be noted that the current BPL criteria in Karnataka do not include an income limit for being considered BPL at all and have several ambiguous ‘exclusion criteria’ only.  Also, it is well known that several ineligible persons have BPL cards while several genuinely poor do not have them.

Also, several workers who are currently APL, may fall below the poverty line suddenly due to health-related or other calamities.  Thus restricting coverage to those with BPL cards leaves many vulnerable families without coverage.

Mr. R.K.A. Subrahmanya, a former Union Labour Secretary and expert on social security, points out that “a review of current labour laws indicates that “in providing protection to particular classes of workers,  the generality of the workers is left without  any protection  thus  creating  pockets of privilege among the working classes.” He laments that there is a “situation of great diversity without a unity of purpose”.

Self-affidavit not being considered for registration of workers:  The only three conditions placed by the Act as eligibility for registration of an unorganised worker are that:

  1. he or she should  be working in an establishment that has less than 10 workers;
  2. he or she should have completed 14 years of age [under Section 10 (1) (a)]; and (2) that
  3. he should file a self-affidavit that he is an unorganised worker [under Section 10(1)(b)]  .

But currently, the State Board is insisting that NGOs, trade unions, etc., should certify that the worker is working in a specific sector, which is not at all required under the Act.   Moreover, unions of domestic workers relate that despite lists of names of thousands of domestic workers being sent to the Board, it does not result in the workers being registered.

No unified scheme or comprehensive benefits

Instead of listing all nine benefits considered as social security benefits by the ILO as the contingencies for which the Central Government may formulate and notify welfare schemes for unorganised workers, the USWSS Act lists only life and disability cover, health and maternity benefits, and old age protection as the contingencies, with the proviso that any other benefit determined by the Central government may also be given.  This leaves out unemployment benefit and family benefit.

The USWSS Act also says that the 10 Schemes included in Schedule 1 of the Act shall be deemed to be the welfare schemes formulated by the Central Government.  There are several problems with such a formulation.  The ten schemes listed in Schedule 1 of the Act are the following:  The Aam Aadmi Bima Yojana (AABY), the Rashtriya Swasthya Bima Yojana (RSBY), the National Family Benefit Scheme, the Indira Gandhi National Social Assistance Programme which provides pensions to the elderly, widows and the disabled, the Janani Suraksha Yojana (JSY), the Janashree Bima Yojana, the Handloom Weavers’ Comprehensive Welfare Scheme, the Handicraft Artisans’ Comprehensive Welfare Scheme, the Master Craftsman Pension Scheme, and the National Fishermen’s Welfare Scheme.

Very little thought seems to have gone into the design of the USWSS Act while formulating it in this manner. It does not provide a unified comprehensive scheme that covers all unorganised workers.   It also does not provide a road-map for gradually working towards a simplification and rationalisation of all existing Acts and schemes, such as those for beedi workers, mine workers, construction workers, etc., with their separate administrative machineries, and bringing all under a single authority and administrative mechanism over time.

It does not provide at least a ‘minimum social floor’ as a right, if not all the nine social security benefits. It has merely put together ten existing schemes each of which have different eligibility criteria for covering workers, have piecemeal and varying benefits and are administered by different departments.

Some of them are restricted to BPL families while others prescribe no income limits.  Some of them are contributory, while others are not.  Some are sector-based while some others are not.  How will these criteria for individual schemes be reconciled with the criteria fixed for registration with the USWSS Board?  While there is cause for confusion within these listed ten schemes, the confusion gets compounded when the plethora of other overlapping schemes that are not listed under this Act, some of which are run by the Centre and some by the States are also taken into account!

Click HERE for full text of the critique

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