Consolidated Labour Laws and the Crisis of Worker Protection

Context:
The Labour Codes enacted during 2019–2020—covering industrial relations, wages, social security, and occupational safety—have sparked serious concerns regarding their impact on informal (unorganised) workers, who constitute over 90% of India’s workforce and contribute nearly 65% of GDP. Editorial critiques highlight the erosion of worker protections, dilution of welfare mechanisms, and weakening of democratic labour governance.

Key Highlights:

Nature of the Labour Reforms:

• Four consolidated Labour Codes:

  • Industrial Relations Code

  • Code on Wages

  • Social Security (SS) Code

  • Occupational Safety, Health and Working Conditions (OSHWC) Code

• Passed without tripartite consultation through the Indian Labour Conference (ILC).

• Raises concerns over procedural legitimacy and worker representation.

Impact on Occupational Safety & Health:

• OSHWC Code replaces sector-specific laws such as the Building and Other Construction Workers (BOCW) Act, 1996.

• Introduces web-based inspections, undermining physical workplace monitoring.

• Violates ILO Convention 81 (Labour Inspection), ratified by India.

• Fails to adequately address occupational diseases like:

  • Silicosis (mining, construction)

  • Pesticide-induced cancers (agriculture)

  • Chronic illnesses in salt pan workers

• Contravenes ILO Convention 161 (Occupational Health Services).

Social Security & Welfare Concerns:

• Social Security Code abolishes sector-specific cesses used to fund welfare boards.

• Establishes a single central welfare board, threatening existing decentralised systems.

• In Tamil Nadu, this could dissolve 39 sector-specific welfare boards protecting informal workers.

• Welfare schemes for unorganised workers are vaguely defined, with no guaranteed funding mechanism.

Federal & State-Level Implications:

• e-Shram portal centralises registration of informal workers.

• Could enable Centre to control nearly ₹1 lakh crore in accumulated welfare funds.

• States like Andhra Pradesh have closed welfare boards post-codes.

• Tamil Nadu, with nearly 3 crore informal workers, is deliberating rule-making to protect its welfare architecture.

• Kerala’s model cited, where States resist dilution of labour protections.

Relevant Prelims Points:

• Issue: Dilution of labour rights under consolidated labour codes.

• Causes:

  • Push for labour market flexibility

  • Ease of doing business agenda

  • Centralisation of welfare governance

• Government Position:

  • Consolidation simplifies laws

  • Claims of universal social security

• Challenges:

  • Exclusion of informal workers

  • Weak enforcement mechanisms

  • Loss of dedicated welfare funds

• Impact:

  • Increased vulnerability of informal labour

  • Erosion of occupational safety standards

Relevant Mains Points:

• Facts & Provisions:

  • Informal sector employs over 90% of India’s workforce.

  • BOCW Act, 1996 provided cess-funded welfare boards.

  • Labour Codes lack mandatory funding guarantees for welfare.

• Keywords & Conceptual Clarity:

  • Informalisation of Labour, Tripartite Governance, Social Security Architecture, Labour Federalism

• International Commitments:

  • ILO Convention 81 – Labour Inspection

  • ILO Convention 161 – Occupational Health

• Way Forward:

  • Restore tripartite consultations in labour reforms

  • Ensure ring-fenced welfare funds for informal workers

  • Preserve State autonomy in labour welfare

  • Align domestic laws with ILO standards

UPSC Relevance (GS-wise):

• GS 2: Social justice, governance, federalism

• GS 3: Labour reforms, informal economy, inclusive growth

• Prelims: Labour laws, ILO conventions, welfare mechanisms