PROTECTING THE VULNERABLE

(Social Welfare of Informal Sector Workers)Team Coordinator – Anurag Kumar, IIFT-Delhi, Kolkata Campus

Team Members – Gautham P R, Rishabh Jain, Shahmir Alam, Swapnil Pandey

• Agricultural workers• Handloom and power loom

workers• Beedi and cigar workers• Crackers and matches industry

workers• Sweepers and scavengers• Domestic Help• Tea Estate workers• Construction site workers• Mining workers• Logistics – Truck Drivers• Casual labour• Employees in shops and

establishments• Workers in tanneries• Tribal labour

BACKGROUND

90-93% of the working population in ourcountry fall in the unorganised informalsector and are not covered by any type ofsocial security protection.

They contribute to nearly 45 % of the nationalincome. The unorganized sector thus addedsubstantial amount to the national economyall through their life. Their participation inmajor industrial activities reveal what actuallyhad they contributed to the building of thenation. The statistics of labour forceparticipation in major industrial activitiesshow us the involvement of the unorganizedsector.

As it is repeatedly said that Indian economy ispredominantly an agricultural basedeconomy, it is also true that it ispredominantly unorganised.

MAJOR PROBLEMS AFFECTING THE INFORMAL SECTOR WORKERS

• The unorganized labourers are directly hit either by inflation rise or by the price rise since their wage rise is always not indexed to the inflation trends in the country on the lines of their counter parts in the organized sector. This throws the unorganized poor into more poverty than they were in before price rise or inflation rise

Poverty Levels

• Another great problem faced by the labour market is the process of casualisation and out sourcing the employment by the industry. The casual labour suffers more from the poverty and from uncertainty of income because of casual nature of employment

Casualisationof

employment

• Another malady of the unorganized labour is the gender inequality. Female are more in casual employment than the males both in urban and the rural labour markets. We find same phenomenon in the self-employed segment also

Gender inequalities

• In the unorganized sector, we find more child labour and the persons aged above 60 years of age

Old aged and Child Labour

• The unorganized in the country do not have any enforceable labour laws. Even bonded labour abolition has not been able to wipe out the bonded labour fully in the country. The minimum wages act has never been fully enforced even in the organized industrial markets for the casual labour they engage. The industrial disputes Act, The trade Unions Act etc. are far from the reach of the unorganized workface thereby making them more insecure than their counterparts in the organized sector

No enforceable labour laws

SOCIAL SECURITY SCHEMES FOR UNORGANISED WORKERS

Indira Gandi National Old Age Pension Scheme

National Family Benefit Scheme

Janani Suraksha Yojana

Pension to Master craft persons

National Scheme for Welfare of Fisherman and Training

Janshree Bima Yojana

Aam Aadmi Bima Yojana

Rashtriya Swasthya Bima Yojana

Handloom Weavers’ Comprehensive Welfare Scheme

Handicrafts Artisans’ Comprehensive Welfare Scheme

The Maharashtra government Mathadi Workers Welfare Fund

The coastal Andhra Hamali Association

Beedi Workers Welfare Fund,

Limestone & Dolomite workers welfare fund

SEWA – Self Employed Women's Association

SOCIAL WELFARE MEASURES ALREADY IN PLACE

UNORGANISED SECTOR RELATED ACTS

Minimum Wages Act

Provident Funds Act

Beedi and Cigar Workers (Conditions of Employment) Act 1966

Beedi Workers Welfare Fund Act 1976

Contract Labour (Regulation & Abolition) Act 1970

The Interstate Migrant Labour (Regulation of Employment and Conditions of Service) Act 1973

Building and Construction Workers (Regulations of Employment and Conditions of Service) Act 1996

The Building and Other construction Workers Welfare Cess Ordinance 1996

GENERAL IMPROVEMENT MEASURES

Monthly pension scheme for the retired at the age of 60 years

Provident fund scheme in addition to the pension scheme for the workers in theunorganized sector

Medical and disablement benefits

Crop insurance to farmers without linking to the banking finance for agriculture but linkedto the holdings of land

These programs either could be run through the existing institutions or as suggestedseparate organizations need to be created. However, the limitations of the existingorganizations (like The Employees Provident Fund Organization, The Employees StateInsurance Corporation) and the legislations have to be examined before assigning theadditional responsibility. The existing organizations may not be able to run or implement allof the above schemes. They should be asked to implement only the scheme in which theyhave gained some experience and expertise

Use of Media Shows like Satyamev Jayate to create awareness about the problem

Accountability and actions against officials who cannot prevent

Encouraging saving habits of the unorganised workers by creating banking awareness- Incentivising banks to open more rural branches and ATMs

Creating awareness and ensuring adequate insurance facilities to the unorganised workers

SECTOR-SPECIFIC IMPROVEMENT MEASURESSCAVENGERS

• “Right to Health” must be included in the fundamental rights of Indian citizens• Women form a major chunk among scavengers and sweepers and this should be taken up at the level of women welfareprograms• The Prohibition of Employment as Manual Scavengers and their Rehabilitation Bill, 2012, is the new legislation that has beentabled in the Parliament on 6 September, 2012. It should not be left unimplemented like the 1993 legislation• Self Employment Scheme for Rehabilitation of Manual Scavengers• Ambit of the law must be widened by encompassing the sewage system, railway tracks, septic tanks etc. under the definition ofmanual scavenging and addresses rehabilitation• A body like National Safai Karamcharis Finance & Development Corporation, with proper financial roadmap should be setup

TEA ESTATE WORKERSWomen constitute over 50% of the workforce and about40% of the Union Committee members. However in most unionsrelatively unimportant positions are given to women. To overcome this problem, women should be given Know Your Rights training, negotiations training and trade uniontraining. This could begin with functional literacy and numeracy, legal literacy. Legal literacy, trade union consciousness, awareness of workers’ rights, human rights and women’s rights should be imparted A vicious cycle of ineffective trade unions and non-representation of the interests of the majority of workers exists, becauseeither there are no elections, or the same (male) leaders get elected over and over again. To avoid this, regular, free and fairelections at different levels of the unions are needed.

BEEDI/CRACKER/MATCHES INDUSTRY WORKERS Though trade unions exist, only 15% of beedi workers are organised in the unions. Steps should be taken to enroll all unorganised workersBeedi Rolling being a home-based production is difficult to organise, issue ID cards, get the exact count of workers involved and implement welfare measures. So it should be converted into an factory-based production.

Lack of alternative skills, little or no access to credit force many women to persist in this occupation. So education has to be imparted to them through night classes and their children should be given free education.India’s child labour law does not cover children who help out as family labour. This loophole has to be adressed and appropriate amendments have to be made.

CONSTRUCTION WORKERS Naka Markets - A local government official should be placed at Naka markets who will monitor the hiringand payment of the labors. He/she will ensure that the labourer is appropriately paid

Give a slip of appropriate amount to the employerAt the end of the day if the labor gets the pre-decided amount, he shall accept the receipt back fromthe employerReturn the slip back at the local government office to ensure that whole deal was closed properly.

Sanitary checks at regular intervals- at construction sites

Ensuring that contractors have basic medical amenities at the construction site as small accidents tend tohappen every other day

Amendment to Contract Labour (Regulation & Abolition) Act 1970: Number of minimum workforce required to hold this law applicable should be reduced from 20 toaround 10

Proper maintenance of attendance registers, entry/exit timings, etc.Payment of appropriate overtime wages to be ensuredIdeal working hours and overtime hours as specified in Companies Act 1956 to be followed, beyondwhich enticing workers to work for extended hours by offering more overtime wages should not beallowed

Effective implementation of the labour laws that making provision of better health, safety and welfare ofthe construction labourers

NGO's working for child welfare should also focus on helping construction workers by providing freeeducation to their children

Constructive support from the trade unions to the construction labourers to be ensured where thegovernment and management couldn't support

COVERAGE AND REGISTRATION:The first thing required to cover the targetpopulation is to make certain legislativemeasures like amendment to the EmployeesProvident Fund and Miscellaneous provisionsact and the Employees state Insurance ActSimilar changes or amendments in theEmployees state Insurance Act 1948 is alsorequired making it a universal applicationAll the contractors of all sorts of businessand shop owners should make provision forsocial security contribution for theiremployeesMake it mandatory to produce socialsecurity identity card for all employees as wellas employers whether casual or regularOnce the legislative changes are made, thecoverage of the members would becompulsory as well as voluntaryIn the case of voluntary coverage, theEmployees Provident Fund Organization alongwith the association of the Employees StateInsurance Corporation conduct joint coveragecampaigns and to give publicity to theschemes of social securityThe Commercial banks, the Regional RuralBanks, and the post offices should be madecollection centres for the collection of thecontributions

RECEIPT AND RECORD OF CONTRIBUTIONS:Once the system of coverage andregistration of the beneficiaries is establishedand the process of coverage is completed itwill be the duty of the organization of thesocial security to collect and record thecontribution of the beneficiaries

The contributions thus collected will berecorded by the organization on real-timebasis and update the account

Further it is also recommended thatindividuals paying contribution can have theircontributions recorded in the passbook by thebank or the post office where they had paidthe contribution

The subsidies sanctioned by the governmentwill directly go to the organization as is beingdone now and it need not be recorded in theindividual account

IMPLEMENTATION PLAN

COMPLIANCE AND ENFORCEMENTCompliance should be encouraged linkingsome incentives to the regularly sensitiveemployers and disincentives to the badpaymasters

In addition, where rural and agriculturalworkers and construction workers areinvolved, the possibility of utilizing theservices of local governments may beexplored

Instead of making the program totally acentrally administered scheme, stategovernments also should be involved for it isrecommended that the medical facilities arelinked with the utilization of the facilities ofthe primary health centres

Compliance can be better managed withthe involvement of NGOs

FINANCE AND INVESTMENTThe government should pay towards partfinancing of the pension scheme and themedical benefits

The government should also stop all thesubsidies given to the social assistancepension schemes and divert all the fundstowards the proposed pension scheme

All the state run pension funds should bemerged with the centrally sponsored pensionfund and legislation should be brought to thiseffect

The funds thus collected will be invested asper the norms prescribed for the presentpension and provident funds as it is proposedto run the social security schemes for theunorganized through the presentorganizational arrangements. The valuation ofthe fund should be done periodically and therates of the contribution should be reviewedevery three years

AWARD AND PAYMENT OFBENEFITSIn case of medical benefits asstated above persons carryingsocial security cards should betreated free of charge in thestate run hospitals

A tie up arrangement shouldbe made with the charitablehospitals by diverting certainamount from the fund to themto extend the treatment to thesocial security cardholders

Disbursement of pensionshould be done through postoffices banks and other state runfinancial institutions free of cost

All these governmentalorganizations and public sectorbanks should be involved indisbursement of benefitswithout charging anything eitherto the beneficiary or theorganization since the socialsecurity for the unorganized isfor a noble cause

POLICY DECISIONS REQUIREDSocial security should be made a fundamental right enforceable bylawIt is urgently required to constitute a commission in the name ofNational Social Security Commission of India, with Prime Minister ofIndia as its ChairmanSocial security Budget should be introduced in the Parliament onthe lines of Railway BudgetPolicy decisions should also be taken to involve NGOs andPanchayats in the rural areas to implement the social securitypoliciesSteps should be taken to introduce social security as a compulsorysubject of study at plus two levels at least in schools and colleges

LEGISLATIVE DECISIONS & CHANGES REQUIREDFirst and foremost in this direction is writing a comprehensivesocial security law-merging all the existing social security laws. Thiswill remove much duplicity in different ActsConstitution should be amended to incorporate social security as afundamental rightConstitution of a National Commission of Social Security forunorganized sector

ALTERNATIVE ARRANGEMENTS FOR EXTENDING SOCIAL SECURITY TO THE UNORGANIZED

It is suggested that the comprehensive social securityscheme should be administered by a tripartite bodywith full autonomy under the Chairmanship of PrimeMinister of India. The proposed Organisation should beheaded by an officer of the rank of Special Secretary tothe Government of IndiaEvery year the Union Public Service Commissionshould conduct a special social security serviceexamination where syllabus is announced in advanceand only those seriously interested in the socialsecurity service should b inducted into the proposedsocial security commissionThe Commission should have zonal offices, Regional(State) Offices, Subordinate Regional Offices at Districtlevel and at Taluk level to administer the schemesThe Commission can also utilize the Gram Panchayatsand Local Bodies for reaching the beneficiary foridentification and distribution of benefit amounts. TheRegional Rural Banks spread all over the country can beutilized for cash benefit disbursementThe total Computerisation of entire administration,opening of kiosks everywhere in the country and issueof a smart card to each beneficiary would go a long wayin the Administration. The smart card would eventuallyexplore many cards like Ration Card, Voters IdentityCard, and Employment Identity Card etc

All the balances from Employees' ProvidentFund Organisation, should be transferred

All the balances from Employees StateInsurance Corporation should be transferred

Employers should contribute a consolidatedsum towards Provident Fund, Pension,Medical, and Gratuity & WorkersCompensation

Employee’s contribution at different ratesbased on their wage structure would also gointo the Fund

All Government grants for old age persons,Medical benefits, Employees PensionScheme’s Pension, subsidy and other socialsecurity schemes should also go into the Fund

ADMINISTRATIVE REFORMS & SET

UP REQUIRED

FINANCING TO MANAGE SOCIAL SECURITY SCHEMES

• INFORMAL ECONOMY: The Growing Challenge For Labour Administration ILO 2005

• The Restructuring of the unorganized sector in India- a paper by Sheila Bhalla

• The Exceptional Persistence of India’s Unorganized Sector by Ejaz Ghani, William R. Kerr and Stephen D. O’Connel

• INTERNATIONAL LABOUR ORGANISATION

• Beedi Sector in India: A Note

• Review of the Child Labour situation in Fire Crackers

• statistical commission_unorganised

• visva-bharati.ac.in

• centreright.in

• cbwe.gov.in

REFERENCES