Covid-19: Ensure labour laws benefit both workers and economy

Need to ensure labour laws benefit both workers and the economy.

In 2019, due to China’s demographic features, its workforce decreased in size. India’s growing skilled workforce provides a much more sustainable resource.
In India, loss of jobs during the lockdown was the first stage in the challenges faced by migrant workers.

By Kevin Bales

As India grapples with Covid-19, it is reasonable that people make sacrifices, accept change and try to help others. But the most devastating of these sacrifices are the ones being made by the poorest and most vulnerable citizens who lost their livelihood due to the lockdown. They stand helpless, unable to access protection schemes and, in particular, those that they need the most to provide for their families.

Many believe stripping of labour rights and protections is necessary by suspending the enforcement of law, expecting it to revive economic activity and attract investment. But there is no evidence that dropping minimum wage requirements, worker safety and sanitation rules, along with protection for women in the workforce, will lead to increase in economic activity. On the contrary, without the circulation of workers’ wages in local markets, businesses will stagnate, consumption will decline, and small businesses will fail. This is a pattern observed across the world in countries hardest hit by Covid-19. In many of these, a key strategy to maintain business viability has been adopted—benefit of direct transfer of funds to the poorest and most vulnerable. These cash transfers helped restart stalled local economies and protecting the poorest from privation. These evidences lay emphasis on the need for a deeper look into the approaches employed by governments to revive economic activity.

In countries that need to do a lot in terms of containing Covid-19—like the US, the UK, Brazil—there is a common theme of relief funds and programmes flowing to well-off political supporters. But these funds are not reaching the vulnerable communities, creating a parallel suspension of basic human and labour rights. This is also pushing more individuals into cheap and disposable labour.

In India, loss of jobs during the lockdown was the first stage in the challenges faced by migrant workers. With some exports suspended, factory workers, clothing and textile workers, and agricultural workers continue to lose livelihoods. In a desperate need to feed their families, they are taking any job on offer—work that is dirty, dangerous, and often the gateway to human trafficking and debt bondage. Likewise, with everyday schools suspended, children are pushed into equally dangerous child labour or child marriages. It is crucial labour laws and protections are reviewed from a lens that benefits both informal sector workers and the economy.

With most governments directing their energies in combating Covid-19, programmes that fight human trafficking are being neglected. In Brazil, police action against debt bondage has been halted. This has meant growth in both human trafficking and illegal environmental destruction in the Amazon. Amidst battling Covid-19 and unable to access protections, India is prone to a similar environmental damage as perpetrators enjoy a reduced chance of arrest. Even in legitimate businesses, the stripping of labour law means a return to the conditions similar to British colonial exploitation. We cannot talk of economic growth when factories no longer have to provide drinking water or basic safety, women no longer have to be paid fairly compared with men, no minimum wage is set, and workers can be dumped on a whim. These lost rights take India back by 50 or more years.

The good news is we know how to address an economic slowdown. When agricultural work slowed to a stop, then ensuring that budget allocation for rural employment guarantee schemes is adequate to address demand will sustain rural families. When falling into debt bondage is likely due to emergency healthcare costs, then proactively reaching out to vulnerable people to provide access to healthcare insurance schemes and other free health-related benefits can keep them out of bondage. When lack of access to education pushes children into labour, then teachers will be required to identify out-of-school children, re-enrolling and retaining them in schools, while carefully addressing the stigma of schools being used as quarantine centres. When there is a lack of access to basic needs such as foodgrains, then easing documentation processes that are necessary for distribution will keep families fed. Finally, notice that each of these steps needs workers to carry them out—thus injecting more wages into the economy and truly stimulating it.

The author is Professor of contemporary slavery, University of Nottingham, co-author of Global Slavery Index, and co-founder of Free the Slaves

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.