6th Five Year Plan
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28 || Appendix

Chapter 24:

Labour policy derives its philosophy and content from the Directive Principles of State Policy as laid down in the Constitution and has been evolving in response to the specific needs of the situation and to suit the requirements of planned economic development and social justice. It is the product of tripartite consultations in which representatives of the working class, the employers and governments have been participating at various levels. Participation of the parties so vitally concerned lends the product the strength and character of a national policy. The aim is to promote cooperation between workers and employers in order to improve production and working conditions and to promote the interests of the community at large.


24.2 While in the early years of industrialisation labour policy was preoccupied mainly with the organised sections of the labour force, growing attention is being paid to the interests of the workers in the unorganised sector without detracting from the concern of Government for the improvement of the real-earnings and working conditions of those in the organised sector.

24.3 The legislative measures adopted during the last decade are evidence of diversification of labour policy to progressively fulfil the Directive Principles of the Constitution. The more important of the measures taken since 1970 are the Contract Labour (Regulation and Abolition) Act to regulate


24.4 The thrust of the programmes in the Sixth Plan should be on implementing effectively the measures contemplated in these different legislative enactments and in extending the coverage of the employees state insurance scheme, the employees provident fund and family pension scheme. Special programmes would also need to be undertaken by the State Governments for the benefit of agricultural labour, artisans, handloom weavers, fishermen, leather workers and other unorganised workers in the rural and urban areas.

24.5 Programmes of workers' education will need to be extended and their quality improved to bring greater awareness of the wider national interests so that workers' representatives can play an effective role in economic and social life.

24.6 There are two special problems facing women workers: discrimination in the labour market based on sex, and their dual responsibility as workers and mothers. Special programmes of workers' education will need to~be evolved for women workers. Young persons also face special problems in a rapidly changing society and economy where there has to be an equilibrium sought between preservation of inherited values and adjustment to changing work patterns and living conditions. It is necessary to have special programmes of workers' education for young persons.

24.7 In the organised sector emphasis will have to be on (i) improving the services of 'the employees state insurance, employees provident fund and family pension scheme, (ii) promoting cooperation between workers and employers through participation in management and (iii) strengthening the industrial relations machinery to better anticipate industrial disputes and to act promptly in order to avert work-stoppages.

24.8 The severity of the energy constraint, the ageing of plant and equipment and prevalence of excess capacity in a number of industries, are features Of the emerging situation during the Sixth Plan, These call for (i) conservation and economy in the use of oil and oil based industrial processes, (ii) better maintenance of plant and equipment, (iii) replacement of plant and equipment which have either outlived their economic life or have to be adapted to use new sources of energy, and (iv) greater labour productivity and acquisition of multiple skills. Training programmes, work schedules and incentive schemes will have to be adapted to meet these needs.

24.9 The determination of the size and level of wages is linked with the problems of evolving and sustaining a wage structure which while based on accepted notions of fair remuneration to labour takes into account the relevant consideration of economic efficiency and incentive. In a society dedicated to the ideals or social justice, it is doubtful if the wage rate can be left entirely to be determined by the market forces of demand and supply. The accepted purpose of policy is to narrow down the existing inequalities and to eliminate malpractices in regard to wage rate and wage payment. On the other hand the commitments to the principles of freedom of association and collective bargaining would require that state regulation should be minimised and it should be limited to ensuring that the weaker sections of labour are not exploited. The tasks of policy here are to lay down criteria for fixation and revision of minimum wages and to evolve wage structure without impinging on the freedom of the parties to negotiate wage agreements.

24.10 The Indian economy is characterised by a dualism, i.e., the existence of comparatively well organised sector side by side with the decentralised sector with a large population which is self-employed. Conscious efforts have, therefore, to be made to bring about a greater degree of inter se equalities in the incomes of non-wage earners, the self-employed, the professionals and the like. In this context, the ro;e of an integrated type of income policy suited to the structural features of the economy holds out promise of fruitful results. The policy instruments for the implementation of such a policy have to be different and more complex than those which have been employed by the developed countries. In the developed countries, wage policy is oriented to their internal problems such as rising prices and balance of payments. The main objective of these countries is to contain the rate of increase in money wages to rate of growth of productivity so that cost inflation does not result. Furthermore, the employment (unemployment) situation in such countries is vastly different from that of ours. In the case of India, however, the main attention has still to be towards providing employment and also minimum levels of wages so that bulk of the population comes above the poverty line.

24.11 In specific terms, the issues and problems of the wage policy relate to the elements like need based minimum wage, .protection of the real wages through compensation for rise in the cost of living, incentives for increases in productivity, allowances for hazards of occupation, wage differentials for skills, responsibilities and other justifiable reasons, essential fringe benefits, bonus and such other ex-gratia payments, social security arrangements like medical care, provident fund, gratuity, family pension etc.

24.12 The level of the minimum wages should be raised, in such a manner that soon the concept of a need-based minimum wage becomes a reality. Construction of a proper cost of living index and the linkage of the wages to the index by appropriate formulae in all areas of wage employment are necessary for protection of the real wages. Criteria would have to be evolved by means of tripartite consultations for allowing increases in wages on the basis of productivity. The techniques of job grading and evaluation should be developed for determining the differentials to be allowed for difference in the nature of the duties and responsibilities.

24.13 While the impact of certain factors like the capacity to pay, productivity and profitability, consumption pattern and cost of living, system of wage fixation, criteria considered in respect of wage fixation etc. as also the heterogeneous character of the economy as reflected in different regions would be felt in the wage differentials disparities, it is to be recognised that the national wage policy should be based on a rational system of wages which inter alia provides for wage differentials justifiable mostly on economic criteria. It is in this context that certain guidelines have to be prescribed even while the primacy of collective bargaining is stressed.

24.14 Bonus payments and some social security benefits have been brought under statutory arrangements. The system of productivity linked bonus introduced recently in Railways, Posts and Telegraphs and some departmental undertakings has the merit of the incentive element capable of application in similar areas where linkage with the profits is not a possible proposition. These systems may be rationalised and refined.

24.15 Marked disparity between inter-State and inter-regional, inter-industry occupations and also between the organised and unorganised, and urban and rural sectors in all these matters is a noticeable feature. Low productivity in agricultural/rural unorganised sectors, socio-economic characteristics including the large extent of mass poverty, unemployment/under-employment, limitation of avenues for gainful employment, lack of organisation on the part of workers affecting their bargaining capacity account for the disparities. The protection afforded under the Minimum Wages Act 1948 has helped minimise the exploitation, to some extent in the rural/unorganised sectors. Growth of income and employment in the un-organised sectors would, however, go a long way in narrowing down these disparities.

24.16 Even in the organised sector, disparities exist between the more sophisticated technolsgy industries and financial institutions on the one side and the rest due mainly again to factors like extent and effectiveness of unionisation, higher profitability, built in privileges and rigidities etc. It would be prudent to consider measures which would ensure that some portion of the wages be linked to minimum productivity norms in case of factories, mines and plantations, and in case of financial institutions and establishments these be linked to the agreed norms of work standards and work performance.

24.17 Industrial harmony is indispensable for a country to make economic progress. Economic progress is bound up with industrial harmony for the simple reason that such harmony inevitably leads to greater cooperation between workers and management which results in better production and productivity and contributes to all round prosperity of the country.

24.18 One of the indicators of the state of industrial relations in the country is the data on the loss of mandays due to strikes and lockouts. Mandays so lost during the 1970s were:

Year Time less (in million mandays)
1971 16.5
1972 20.5
1973 20.6
1974 40.3
1975 21.9
1976 12.7
1977 25.3
1978 28.3
1979 (provisional) 43.9

24.19 Except for the year 1974 whL-h witnessed a prolonged strike in the railways, the time loss in the first six years was generally well below 22 million. Thereafter, there was a rising trend in the time loss till it attained its peak figure of 43.9 million. In most of the cases, wages and allowances, bonus, personnel and retrenchment and conditions ot work have been identified as the causes resulting in disputes leading to strikes and lockouts. Attempts to tackle these issues and to settle the disputes through conciliation, arbitration and adjudication have had partial success.

24.20 Healthy industrial relations, on which industrial harmony is founded, cannot be regarded as a matter of interest only to employers and workers, but also of vital concern to the community as a whole. Further, in the ultimate analysis, the problem oi industrial relations is essentially one of attitudes and approaches of the parties concerned. A spirit of cooperation stipulates that employers and workers recognise that while they are fully justified in safeguarding their respective rights and interests, they must also bear in mind the larger interests of the community. This is the true significance of the doctrine of industrial harmony in its three dimensional aspect.

24.21 The Industrial Disputes Act, 1947 has been the main legislative framework which has provided the machinery and procedure for the settlement of disputes through mediation, conciliation, arbitration and adjudication. Steps were also taken in the past to provide a voluntary approach to industrial relations through Codes. A general feeling has developed that the existing arrangements have not proved effective in preventing disputes and promoting settlements. Since the submission of the report of the National Commission on Labour, efforts have been made for evolving a new and comprehensive industrial relations legislation but these have not succeeded on account of the divergence of approaches among the trade union organisations on certain basic issues such as the machinery and procedure for settlement o't' disputes, the criteria and procedure for recognition of trade unions, i.e., whether the representative character of trade unions should be determined through verification of paid membership of contending unions or through secret ballot; right to strike in essential industries including public utilities, role of government in regulating industrial relations, etc. While efforts must continue to minimise the areas of disagreement among the parties concerned and acceptable improvements in law and machinery effected, some of the changes in the existing laws on trade unions, industrial disputes and standing orders, which are generally considered essential for promoting industrial relations, need not be held over and should be carried out. These changes would help in streamlining the existing procedures, and securing speedy justice to workers. The question of providing security of service to such categories of employees who are at present outside the ambit of labour laws also needs consideration.

24.22 It may also be stressed that if the huge investments during the Five Year Plan are to yield th« desired results, certain important measures cannot be delayed for long; for example, the core sector including power, energy, coal, steel and transport needs to be insulated against uncertainties of the industrial relations situation to the maximum extent possible. H adequate consultative machinery and grievance procedures are evolved and made effective, strikes and lockouts can become redundant in these industries. In other areas, also, strikes and lockouts should be resorted to only in the last stage. Effective arrangements should also be made for the settlement of inter-union disputes and to discourage unfair practices and irresponsible conduct.


24.23 At the enterprise level, workers' participation in management should become an integral part of the industrial relations system to serve as an effective instrument of modern management. It should be made a vehicle of transforming the attitudes of both employers and workers for establishing a cooperative culture which may help in building a strong, self-confident and self-reliant country with a stable industrial base. Various measures have been tried in the past to promote workers' participation. Starting from the limited scheme of statutory Works Committees, voluntary arrangements were made in the form of joint management councils, scheme of worker-directors, both as a statutory arrangement in nationalised banks as well as a voluntary one in selected Central public enterprises, and voluntary scne-mes of workers' participation for manufacturing/ mining industries in 1973 and for commercial and service organisations in the public sector in 1977 as essential ingredients of the 20-Point -bconomic Programme. A 21-Member Committee comprising the representatives of employers, trade unions, government and academicians has studied the matter m depth and recommended, among others, a legislative scheme of workers' participation providing three-tier participative forums at shop floor, plant level and Corporate/board levels. An enlarged area of participation to cover matters relating to operational economic and financial, personnel, welfare and environment areas has also been recommended. It is recognised that there is a very wide area of relationship in an enterprise outside the domain of collective bargaining where employers and workers can work jointly for the benefit of different interest groups and for the common interest of the enterprise as a whole. Such a system of consultative and joint-decision making would ensure frictiomess operation at various levels, provide job satisfaction, release the latent creative energy of workers, reduce their alienation and enhance the commitment of workers and the line management to the common ideal of better performance. But it is necessary to provide effective arrangements for training workers and managerial! supervisory personnel so as to motivate them in making the scheme of workers' participation a success in the larger interest of the enterprise on which depends the well-being of both the parties. An effective agency for monitoring and evaluation would greatly help in making participative management a success.

24.24 It is necessary also to strengthen the tripartite consultative machinery so that it may be possible to evolve the broad framework of labour policies and programmes after full consideration and discussion among all interests concerned—the trade unions, employers and government. At the industry level, standing tripartite committees could serve a useful purpose in identifying the bottlenecks and deficiencies and suggesting corrective measures. Regular and effective functioning of such forums would provide opportunity for a dialogue and facilitate proper motivation which is essential for improving industrial relations. To help this process, communication and information sharing systems should be enlarged and decisions arrived at after proper consultations should be implemented with the utmost expedition.


24.25 Trade Unions in the organised sector have attained a unique status and position. But the extent of unionisation has not been uniform. On the whole, it would be in the vicinity of about 30 per cent of the strength of the working force in the organised sector. Proliferation of unions and inter-union and intra-union rivalry have affected their reasoned bargaining power as well as their financial position. This phenomenon of multiplicity and the dependence of unions on outsiders tor leadership have sometimes led to inter-union rivalries which have often undermined the effectiveness of collective bargaining and led to industrial unrest. It would help in the growth of trade unions on healthy lines i'i multiplicity is overcome. It would enhance their strength and facilitate the enlargement of their role in many areas of nation building including planning and development. It calls for a reorientation of the approach, which has to be based on a value system of social obligations, mutual trust and fair practices in an atmosphere of goodwill and understanding. Trade unions must give serious thought to these matters in the interest of the trade union movement.

24.26 Serious efforts need to be made by trade unions to promote a spirit of greater involvement of workers in the enterprise to fulfil the norms of greater efficiency and also achieve excellence in its overall performance so as to be able to share the benefits of such improved functioning.

24.27 Trade unions have a vital and constructive role in improving the quality of life of the workers. They should evince greater interest in welfare programmes for their members such as education including literacy, health and family planning, and recreational and cultural activities. They can also promote personal and environmental hygiene and promote a sense of thrift and savings. Government can consider some financial aid to those trade unions which take up such welfare activities. Such involvement in constructive activities would help the trade unions in furthering the interests of their members.


24.28 Expansion of social security measures result in multiple advantages. Several social security measures like Employees State Insurance, Employees Provident Fund, Gratuity, Maternity benefits, etc. have been in operation. However, their coverage is limited mostly to the organised sector. The Employees Provident Fund assumes significance in terms of accruals which are sizeable. A major portion of these accruals form an important source for financing development. Together with employers' contribution and the availability of accumulated benefits, it also acts as an important redistributive measure benefiting the lower income class. The coverage of the scheme currently extends to 157 industries/classes of establishments with a total membership of about ten million. The scheme should be gradually extended to smaller establishments and to the rural areas. With increase in membership and a possible enhancement in the rate of contribution, the size of the fund could be augmented considerably and, among other things, this could be used to finance important direct benefit programmes like housing for workers which has so tar lagged behind due to paucity of resources.

24.29 The Employees State Insurance Scheme provides for medical care, maternity care, insurance against sickness or employment injury and similar benefits. At the end of December, 1980 it covered over six million workers in 408 centres; the total number of beneficiaries including family members was twenty seven million. The medical benefits under the Scheme are provided through the State Governments except in Delhi where they are provided by the Corporation direct. A phased programme for expansion of the scheme has been drawn up but limitations of financial and physical resources of the State Governments have been a major constraint in expanding the scheme. Efforts should be made to remove the difficulties and to extend the coverage to new areas.

24.30 There are statutory welfare schemes for workers in mining industries like coal, iron oce, manganese ore, limestone and mica and for workers in the beedi industry which provide facilities of drinking water, housing, education and recreation. It is necessary for State Governments to undertake welfare programmes 'for the benefit of workers and artisans in the rural sector particularly for those engaged in agriculture, fishing, weaving and leather processing.

24.31 As welfare and social security services often overlap in areas of medical care and income security during sickness and disability, it will be conducive to efficiency and economy if services in such common areas can be integrated.


24.32 Working conditions include not only wage structure, fixing of a minimum wage and protection of income, but also the fixing of working hours, periods of rest, paid holidays, provision of canteen facilities and provision of creches for children. Today, safety includes not only protection of workers against accidents at work but also against occupational diseases. Indeed, with the growth and diversification of industry and agriculture, the safety and health of workers goes beyond mere measures of prevention. It is equally important to improve the environment since safe and healthy working conditions are the best protection for the worker and the best guarantee for increased production. Safety in industrial establishments is the concern primarily of the State Governments. Safety in ports and docks and in mines, including oil fields, is the concern of the Government of India. The Director General of Factory Advice Service and Labour Institutes lays dock standards and carries out inspections in ports and docks. He also undertakes research and studies in the fields of industrial safety, ergonomics, industrial hygiene and occupational health. .He liaises with the Chief Inspectors of Factories of the different States to secure common standards, exchange of information and experience and to develop alert system to detect occupational hazards to the health of the workers. He. is also the National Authority in the International Alert System to detect potential hazards.

24.33 The Director General of Mine's Safety is concern with the safety and health of workers in the mines. In the field of mines safety, surveys are undertaken regarding accident prone mines for identification of corrective measures. Augmentation of training facilities and modernisation and expansion of rescue services constitute an important area of activity in this field. Provision has also been made tor improvement in the R and D facilities and development of rescue apparatus. These institutional arrangements and promotional measures would be adequately strengthened. Effective measures would be taken to ensure consciousness at all levels regarding safety precautions at work place. Steps would also be taken for an overall improvement of safety education and the provision of arrangements for this purpose in au factories, mines, ports etc. The National Safety Councils and Safety Conferences can make a significant contribution to bring about safety consciousness in this area also, workers' representatives will be increasingly associated as they can play an effective role in the maintenance and preservation of safe working conditions.

24.34 The thrust in the Sixth Plan ought to be in extending measures to protect the safety and health of workers engaged in agriculture and forestry. There is also need to intensify and extend the studies which have been initiated with the assistance of organisations like the Indian Council of Medical Research to identify the incidence of occupational diseases in specific areas, to evaluate the adequacy of existing arrangements for protection and treatment of workers and to detect newly emerging occupational health hazards.


24.35 The activities relating to labour research and statistics would also be strengthened to expand the coverage and improve the quality of the data and minimise the timelag in compilation and publication. Schemes have been included for the revision of the Consumer Price Index Numbers relating to industrial workers and agricultural workers compiled by the Labour Bureau. The National Labour Institute would extend consultancy and training services particularly in the areas of workers' participation in management, promotion of grass root leadership and motivation research etc.


24.36 Vocational rehabilitation of the physically handicapped categories would be promoted through evaluation and adjustment services and skill training imparted in specially designed centres which would also have facilities for production under controlled conditions. At present eleven Centres are functioning under the Directorate General of Employment and Training (DGE and T) for their rehabilitation. During the Sixth Plan it is proposed to set up more such centres in addition to expanding the existing ones. The attention of these Centres has been mostly towards the orthopaedically handicapped category so far and oiher categories like blind, deaf and dumb, mentally retarded, spastics etc. would also have to be covered. Voluntary organisations have been playing an effective role in this field. A coordinated approach towards optimum utilisation of the facilities would be beneficial. A suitable action programme is being drawn up on such an integrated approach in the context of the International Year for Disabled Persons 1981. Reservation of training places as well as jobs for these categories to a suitable extent is being pursued.


24.37 This item has been included in the 20-Point Programme. Location of training capacity based on surveys is a continuous process. The progress of this programme has been affected by deficiencies in the quality of training imparted and the non-absorption of the trained apprentices in regular jobs. These issues are inter-related to some extent. Hence alongwith the extension of this scheme to cover more trades, efforts will be made to improve the quality of training through better practical instructions including related instruction facilities, provision of hostel arrangements for the benefit of out-station apprentices, increase of stipend, more effective supervision and better liaison with the industries etc. Regarding absorption of successfully trained apprentices preferably in the same units where they have received training, reserving some percentage of jobs filled by open recruitment is recommended. Successful completion of apprenticeship could be prescribed as one of the qualifications for employment so that there could be optimum utilisation of trained manpower.


24.38 Involvement of rural workers' organisations is relevant not only for the better implementation of the minimum wage provisions but also for generally ensuring the benefits intended for rural workers under the various development programmes. It is well known that even in the organised sectors, the growth of trade union movement has not been significant in terms of strength of membership, or its even spread. Tlie problem in the case of rural workers is further aggravated due to their lower level of awareness and other disabilities. As it would take time for voluntary trade unions to make a dent among these sections, it is considered necessary for the State machinery to facilitate the process in the initial stages.

24.39 It may also be noted that the Government of India has already ratified I.L.O. Convention No. 141 which enjoins that it shall be an objective of the national policy concerning rural development to facilitate the establishment and growth of strong and independent organisations of rural wprfeers, including agricultural labourers, artisans, share croppers, tenants and small farmers so that they get their due share in the benefits of economic and social development. As in the case of trade unions of industrial workers, organisation of the rural poor needs to be sponsored by the workers themselves or voluntary organisations including political organisations interested in the welfare of the rural poor. The Government may lake some measures to facilitate the process. T'hese would include suitable legislation for conferment of specific rights to the rural poor to set up unions for safeguarding their interests, registration of such unions of the rural poor, specific Immunity to office-bearers and members of such unions from certain crim'nal and civil suits and setting up machinery for settlement of disputes, training and education of the cadre and some form of financial support for meeting organisational expenses, etc.

24.40 A promotional effort in this area is proposed to be undertaken with necessary guidance and financial assistance from the Centre and the active involvement of the 'State Governments particularly their block level agencies.


24.41 Another aspect relevant to the upliftment of certain sections of the poor relates to the effect-tive enforcement of the provisions of the Minimum Wages Act, 1948 which provides for the fixation and periodical revision of minimum rates of wages in agriculture and other employments in the unorganised sectors. The protection mainly benefits the landless agricultural labourers and workers in other 'sweated' employments. Except in the employments under ths Central Government which do not account for much under these categories, the implementation of this Central legislation is the responsibility of the State Governments. Slow-coverage of new employments, delay in periodical revisions of the minimum rates fixed under the Act and ineffective enforcement of the existing provisions have been the main issues relating to this measure. The need for strengthening the enforcement machinery, simplification of the procedure relating to coverage and revisions, the linkage of the rates with the Consumer Price Index Numbers, involvement of the rural workers' organisations in the implementation of the provisions are among the steps advocated to improve the results. The necessary amendments in the statutory provisions are likely to be initiated soon. Sufficient strengthening of the enforcement machinery would provide an effective arrangement for better implementation of the. Minimum Wages Act. In this context it may be pointed out that this measure coupled with programmes like National Rural Employment Prooramme and Integrated Rural Development etc. would represent a coordinated and mutually supporting effort for raising large number of rural poor above the poverty line. Proposals for Central leaislation for aaricultural workers are under con-e'aieratioo,


24.42 Besides the evils of indignity and exploitation involved, the system of bonded labour has placed certain sections of the population in perpetual poverty, backwardness and dependence. The abolition of the system by an appropriate legislation in 1975-76 was first step in generating hopes for this section, 'the lowest among the rural poor. Subsequently efforts were undertaken for the social and economic rehabilitation of the freed bonded labourers by making available opportunities for gainful employment including self-employment. While these efforts were mostly integrated with the on-going sectoral programmes, the need for special schemes to supplement these efforts was realised and a Centrally sponsored programme was started in 1978-79. The experience of last two years has brought to light certain practical problems in implementing this programme. Even the identification of this category has given rise to vastly varying estima'es partly, due to the lack of clear concept and also due to the inadequacies in the machinery of the State Governments.

24.43 The preliminary report of the survey on the incidence of bonded labour conducted in 1978 by the Gandhi Peace Foundation and National Labour Institute indicated a high figure of about 22.0 lakhs. However, according to the findings of the National Sample Survey (32nd round) the estimated number of bonded labourers in 1977-78, was about 3.5 lakhs. Pending further scrutiny of these estimates, the figure of 1.20 lakhs as reported by different State Governments was adopted for operational purposes. While these persons are expected to be rehabilitated by 1981-82 the State Governments have been requested to identify if any more persons falling in this category. Any partial rehabilitation would defeat the purpose of the programme and result in their relapse into near J bondage. To prevent such an eventuality, an expan-jj ded scope of rehabilitation on a family basis is being% considered with provisions for minimum consumption loans and making available durable assets to facilitate their engagement mainly in non-farm occupations like animal husbandry, piggery, bee-keeping, etc. which could provide a reasonably sound basis for sustained employment and income. A change in the pattern of issistance is also under contemplation.


24-44 Total abolition of child labour with all its socio-economic ramifications does not seem to be a feasible proposition in the immediate future. According to 1971 Census, the estimated number of child workers below the age of 15 years was 10.74 million representing 4.66 per cent of the total child population and 5.95 per cent of the total labour force. Ths ~ predominance of boys in the category of child labour is indicated by the fact that they account for more than 70 per cent of the estimated child labour force. The incidence of child labour is mostly in the unorganised, informal and unregulated sectors. This is to be ex-pec'.ed since there are statutory provisions regulating the engagement of child labour in factories, mines and plantations whi^h are in the organised sector. While this system is spread throughout the country, the State of Audhra Pradesh accounted for more than 15 per cent of the total child labour in the country. Abolition of this practice has to be a long term goal based on minimising the need for their earnings to supplement the family incomes and suitable statutory provisions for regulating their engagement in different occupations. However, immediate attention should be given to prevent their exploitation which when pursued in unhealthy environment causes permanent damage to the physical and mental development of children. Towards this end the tightening of the existing regulatory provisions and introduction of welfare measures to improve the nutritional level of the working children would be reflecSed in the appropriate programmes.

24.45 A high powered Committee has recently studied this question and recommended among other things, a multiple policy approach in dealing with the problems of working children. Appropriate measures would be taken to regulate employment of cirld labour, guarantee minimum standards relating to condition of service, welfare etc. Child labour has to be seen d'st'ncily in the categories of wage earning employment: paid fam'Iy workers; and apprentices in traditional crafts. The household approach to poverty alleviation envisages the ultimate elimination of child labour through programmes for the economic emancipation of the family and for education of children.


24.46 Since women form an important component of the workforce and since they bear a triple burden, special steps will have to be taken to promote their welfare and development. Generally, welfare agencies have been reluctant to press for their demands because of the fear of the adverse impact such demands may „ have on women's employment. Non-recognition of | their role has led to complete neglect of their needs. | The protection extended so far relates to prohibition of employment of women in underground coal units/ mines, also in certain other hazardous occupations. provision of certain welfare facilities like creches, maternity benefits and ensuring eaual wages for equal work for both male and female labour. While social services like health services, education, etc. are re-ouired bv ali labour, male and female, the employment of female labour would call for special attention to the following:

  1. provision of basic amenities in working and living conditions, such as housing, water supply, hospital and medical services, sanitation, e
  2. provision of maternity leave benefits, family planning incentives, etc.;
  3. provision of care and education for all the children of the family;
  4. provision of opportunities for education, skill training and upgrading and advancement in order to widen areas and avenues for their employment; and
  5. provision of alternative employment schemes for off-season and unemployment periods.

24.47 This requires the development of suitable infrastructure and joint action by the Ministries of Labour, Rural Reconstruction and Social Welfare, besides the State Governments, local authorities and voluntary agencies. Such measures would be promoted during tne Plan.


24.48 Contract labour is generally employed for casual, seasonal or irregular work. The Contract Labour (Regulation and Abolition) Act, 1970 seeks to abolish the contract labour system in perennial operations and regulate it where the system cannot be abolished. The Act is implemented both by the Centre and the States. In the Central sphere the contract labour has been prohibited for certain specified operations in coal, iron ore, limestone, dolomite and manganese mines, and in buildings owned or occupied by establishments under the Central Government. The working of the Act over the years has indicated somewhat slow rate of progress in abolishing contract labour. Various deficiencies have also been noticed and suitable amendments to the Act are under consideration.


24.49 A large part of the unorganised labour force in the country consists of unskilled labour, both male and female employed in various forms of building and construction activity. They are mostly rural migrant either landless or sharecroppers and marginal/small land holders who come to the cities in search of work, being drawn from the same pool as the unorganised agricultural labour in the rural areas. This is not only migrant in the conventional sense of having moved from their original place of residence due to economic pressure but also extremely mobile due to the conditions and problems of emoloyment in the construction industry which is characterised by high turnover, use of contract labour, irregular employment, seasonal variability, dependence on supplies of raw materials etc. Some of the characteristics-of this category are:

  1. high economic vulnerability due to the double combination of irregular and unstable employment and consequent high mobility on the one hand and their utilisation omy in the lowest grade of job on the other;
  2. high proportion of female labour and frequent employment of whole family or couples;
  3. low capacity to utilise existing services because of high mobility; ignorance resulting from migrancy, lack of responsibilty of civic agencies towards them as well as poverty, illiteracy etc.;
  4. low health status, particularly harmful to children resulting from hazardous, insanitary and inadequate working conditions;
  5. lack of unionisation due to mobility and other reasons mentioned above; and
  6. lack of opportunity for training, skills upgrading or li'eracy for older people and of basic education for the children due to above conditions.

24.50 The basic steps that need to be taken to provide a fair deal for this group are:

  1. provision of some degree of stability and longer duration of employment;
  2. recognition of the special role of women in the labour and provision for them; and
  3. infrastructure for the development and practical implementation of services which are provided for by existing legislation.

24.51 To a limited extent, the Workmen's Compensation Act, 1923, the Minimum Wages Act, 1948, the Employees State Insurance Act, 1948, the Contract Labour (Abolition and Regulation) Act, 1970, and Standing Instructions relating to casual labour applicable to tfie employing agencies apply to construction labour. It has, however, been noticed that these legislative enactments and standing orders do not cover safety at work and social security. To remove this lacunae, a Central legislation for construction workers is under consideration.

24.52 Even for projects which are planned to continue for five years the unskilled labour is usually employed for periods of three months or less. Often there are long gaps and periods of unemployment. A minimum of 200 consecutive working days would need to be assured. This can be done through adoption of NREP approach with proper forecasting of labour requirements at different stages by employers. The Ministry of Labour should insist upon suitable arrangements regarding the utilisation of unskilled labour by Government departments. Significantly, about 80 per cent of all investments in buildings and construction in the country is Government investment and nearly half of all Plan expenditure is eventually routed to this sector. It should thus be possible to insist' on such an exercise in the interest of labour and make it a pre-condition for project approval.


24.53 Lack of employment opportunities have forced many rural workers to migrate in search of jobs. Special problems of this category of laboiners have been recognised. To regulate the employment and conditions of service of such workers and to provide them certain welfare amciities, the Inter-State Mierant Workmen (Regulation ot Employment and Conditions of Service) Act. 1979 has been enacted and rules framed under it bro""ht into force with effect from 2nd October, 1980. The Act provides for repistration and li'ensinn of establishments and contractors. The other obligations on )he part of the contractor relate to furnt

24.54 Effective steps would be taken during the Sixth Five Year Plan to ensure implementation of this Act by a suitable machinery at the Central and tl'e State levels. The infrastructure in this regard could be developed on the following Sines'

(i) Migrant Labour Board—A statutory body would be set up with representation from the three main concerned Ministries (namely, Labour, Social Welfare, and Works and Housing) though other M'nis-tries and Departments (notably Irrigation) are also concerned and may be included The Board would not be merely advisory but should have executive powers to enforce its decisions; otherwise it cannot be effective. It would concern itself with all issues affecting wages and working conditions, of planning for stability in employment and welfare provisions; and should have powers to revoke or withhold licenses until such time as its requirements are met. with. There should be corresponding Boards in each State.

(ii) Funding for the Board and services operated by it should come from a cess levied on all projects. The cess should be related to the volume of investment and duration of the project and not to the numbers of people employed. This should be regularly costed for as part of the tender.

(iii) The Board should have a team of specialised social workers, in each State, to constitute a Migrant Labour Cell. The duties of this cell should be to keep in touch with all migrant labour, to provide them access to normal facilities and civic amenities, to act as an employment information bureau. The team of social workers will have to be mobile and flexible and should receive special orientation and training for this work. The cell should work in close collaboration with local authorities, particularly the health and education departments of municipal authorities, who should be helped tc form Iheir own mobile teams to offer services to such groups, so that they can be gradually integrated In the regular urban networks.

(iv) Tht, Board should fund creches, non-formal education centres anj other specialised services which Aould be provided by competent agencies, with adequate trained staff. These specialised services cannot be rendered by building contractors, but can only be funded by them. Separate fund has to be found for training, supervision and management of these centres and monitoring to be done by the Board or a specialised sub-Committee of the Board consisting of people with competence in the field.

(v) Training is needed, not only for workers, organisers and supervisors of creches, non-formal education centres, health centre!? and other specialised services, but also for the staff of the Migrant Labour Cells, and for extension work to local authorities, as well as for functionaries at all levels handling this programme. Suitable budgets for this mirastn:cU'rc has to be worked out.


24.55 With the spread of intensive agricultural practiced in the Punjab-Haryana-Westem U.P. region, large numbers of labour families from Bihar and Eastern U.P. are moving towards areas where there is work. The living conditions of such migrant farm labour need considerable improvement. Measures would be introduced during the plan to lay down norms "f welfare activities and dormitory housing on the farms for such migrant farm labour.


24.56 Several communities engaged in animal husbandry have to move over long distances in the hills to feed their animals. Jammu and Kashmir has started educational programmes for the children of such migrant families. However, this problem needs integrated action. For this puropose, suitable projects would be supported for developing systems of delivery of minimum needs to such families.


24.57 An outlay of Rs. 161.9 crores is proposed for Labour and Labour Welfare programmes for the period 1980—85. Of this, the Oantral ouday would be of the order of Rs. 78.5 crores and the remaining Rs. 83.4 crores being accounted for by States and Union Territories. Annexure 24.3 gives the broad break-up of the total outlay by major programmes.

Annexure 24.1 Growth of Trade Unions and Membership

Year No. of Registered workers' Unions

Number submitting returns

Membership of Unions submitting returns
(in Lakhs)
1973 23503 6402 43-77
1974 25056 5716 42-19
1975 25460 6097 45-69
1976 25665 6609 46-97

Source : Labour Bureau

Annexure 24.2 Average Annual Wages of Factory Workers

Year Average Wage Per Worker All-India CoMumer Price Index Number for Industrial Workers (Base 1960-100) Average Wages at 1960 (Constant) Prices*
(Rupees) (Rupees)
1960 1202 100 1202
!965 1735 137 1265
1968-69 2223 174 1263
1973-74 3364 250 1304
1974-75 3821 317 1249
1975-76 4301 313 1374
1976-77 4357 301 1443
1977-78 4560 324 1407

*Deflated by the All India Consumer Price Index Number for Industrial Workers, (base 1960== 100)
source: Annual Survey of Industries.

Annexure 24.3 Sixth Plan Outlay : Craftsmen Training and Labour Welfare Programmes
(Rs. in lakhs)

Sl.No. Group of Schemes Centre States Union Territories Total
i Craftsmen Training 2350 4566 633 7549
ii Apprenticeship Training 750 456 65 1271
iii Employment Service. 700 723 70 1493
iv Labour Welfare 1550 1011 148 2709
Total (i to iv) 5350 6756 916 13022
v Centrally sponsored scheme of Rehabilitation of Bonded Labour 2500 668 3168
Grand Total (i to v) 7850 7424* 916* 16190 *
or say (in Rs. crores) 78.5 74.2 9.2 161.9

*As recommended by Working Groups.

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