The Hindu : Consulting the stakeholders

Online edition of India's National Newspaper
Wednesday, May 08, 2002

Opinion

Opinion - Editorials

Consulting the stakeholders

THE RECENT ASSURANCE by the Union Labour Minister, Sharad Yadav, that all stakeholders, including trade unions, will be consulted before amending labour laws comes at a time when there is a visible slowdown in the pace of the country's economic reform process. Translating Mr. Yadav's statement of intent into practice, however, requires a comprehensive public debate on the state of economic reforms and its impact on the country's workforce. Reviving an active and informed discussion on the state of economic affairs will be an important task for the country's intelligentsia if the oft-stated reforms with a human face are to be truly ushered in. An important fallout of the decade of reforms has been the changing composition of economic activity in India. The shift from manufacturing towards services, coupled with competition from imports, has meant that accretions to the workforce in the manufacturing sector have been sliding. More than the past decade, the years ahead will see the unfolding of the more sensitive part of the reforms as the changes contemplated will have a direct bearing on the workforce and, consequently, the individual will bear the impact of reforms in a more direct manner. As the next round of reforms will bring in fundamental changes to two basic premises of employment — permanence in jobs and the ability for collective bargaining in the organised sector — it is important that the collective mind is prepared for competition.

Mr. Yadav's statement also highlights the importance of a continuous engagement with the stakeholders, including the leadership of organised labour, as the experience of the past decade has brought home the difficulties faced by Governments in disinvestment and privatisation. In a way, the year 2001 had all the markings of a Government that wanted to push ahead with labour reforms. Last year's coming together of the various trade unions in the country to oppose the tenor of reforms should, therefore, be taken as a serious pointer that winning the confidence of the workforce will be an important prerequisite for carrying forward the reforms. It is equally important to consider the consequences of reforms on labour from a viewpoint that is wider than the legislative framework. The policy decisions on downsizing of Governments, closing down recruitment cells, freezing and lowering the intake into public sector jobs and the recent trend of outsourcing some routine operations are indications of the changes that would sweep across the Indian labour structure.

In such a changed scenario, the role of trade unions will also necessarily have to expand from collective bargaining and aim at equipping the worker to meet the new demands of employment. The new focus should be on ensuring that adequate protection clauses for the workforce in areas relating to social security are put in place. Clearly, there is a need to widen and redefine the scope of labour protection from the past public sector framework and collectively arrive at a meaningful mechanism that softens the harsh consequences that the workforce is likely to face in the event of further reforms. Addressing the needs of the unorganised sector is another important area that should engage the attention of policy makers and workers' representatives. The realisation of the inevitability of labour reforms contrasted with the continued reluctance to move further in that direction can only result in deepening the present difficulties. The most meaningful manner in which the concerns of all the stakeholders can be truly addressed in this sensitive task is to appropriately equip the workforce with the means to face competition.

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