A Critique on the Suspension of Labour Laws
Suspension of Labour Laws probes the dilemma of safeguarding workers’ rights versus easing business norms in a phase of economic recovery. Introduction Justice P. N. Bhagwati while accentuating the hardships of the wage-earner class of the society, had said, “If the sugar barons and the alcohol kings have the fundamental right to carry on their business and to… Read More »
Suspension of Labour Laws probes the dilemma of safeguarding workers’ rights versus easing business norms in a phase of economic recovery.
Justice P. N. Bhagwati while accentuating the hardships of the wage-earner class of the society, had said, “If the sugar barons and the alcohol kings have the fundamental right to carry on their business and to fatten their purses by exploiting the consuming public, have the chamars belonging to the lowest strata of society no fundamental right to earn an honest living through their sweat and toil?”
The Supreme Court in its various labour law related judgements has held that beneficent legislation that is for workmen benefit and which support the fundamental rights of workers, should be enforced by the government. If the weaker sections of society are unable to knock the gates of justice in Courts, the government must, of its own initiative, ensure that workers’ fundamental rights are upheld.
It goes against the essence of human rights enshrined in our Constitution, but in the aftermath of the economic crisis caused by the coronavirus, many State governments have brought out ordinances, suspending the labour laws.
Uttar Pradesh came out with its Temporary Exemption from Certain Labour Laws Ordinance, 2020, which suspends labour laws for three years. However, UP has not suspended Bonded Labour (Abolition) Act, 1976; the notification also clarifies that workers will have to be paid at least the minimum wage.
Madhya Pradesh which has its separate MP Industrial Employment (Standing Orders) Act, 1961, also brought out the Madhya Pradesh Labour Laws (Amendment) Ordinance, 2020.
Similarly, Gujarat, Rajasthan, Haryana, Uttarakhand, Himachal Pradesh, Assam, have also through their rules and notifications declared suspension of labour laws. Uniformly, these states have extended the per day factory work hours from the previous maximum of 9 hours to now stretching up to 11-12hours a day. Provisions of overtime pay are also not etched out clearly.
Ministry of Labour and Employment of India states that the ILO (International Labour Organization) conventions which India has ratified would act as guiding principles for the labour laws.
India has ratified 6 conventions which are, namely,
- Forced Labour Convention,
- Equal Remuneration Convention,
- Abolition of Forced Labour Convention,
- Discrimination (Employment Occupation) Convention,
- Minimum Age Convention, and
- Worst Forms of Child Labour Convention.
The notifications suspending labour laws clearly go against the ILO conventions. Further, the suspension of the provisions of the Factories Act, 1948 is unconstitutionally done. In Section 5 of the Factories Act, the “Power to exempt during public emergency” is given to the State Governments, yet it is not correct to interpret the COVID pandemic as an emergency that would enable curtailing labour laws.
Public emergency would usually be seen as circumstances endangering the security of India, internal disturbance, external aggression, war, and putting the COVID pandemic as a public emergency that could suspend labour laws, is indeed a mockery of all the democratic and socialist ideals our Constitution enshrines for us
Suspension Of Labour Laws Not In Accordance With Constitutional Provisions
Labour Laws are in the Concurrent List in the Seventh Schedule, and in Article 254(1) of our Constitution, Centre made laws/Parliament upheld laws would be given primacy. But Article 254(2) provides the exception to this. The second clause allows States to enact their own laws if the President’s assent is received.
Under Article 213, the Governor of a State cannot promulgate ordinances without instructions from the President. Though the contemplation by different states to dilute labour laws is happening, we can still see that Presidential assent is essential constitutional protections against any unwarranted legal deviations that State governments may want.
The Doctrine of Repugnancy has arisen here as there is a direct conflict between statutes enacted by the Centre and the State on matters in the Concurrent List, and there is repugnancy between them as held in the case of Deep Chand v. State of Uttar Pradesh.
Explaining the effect of Article 254(2), the Supreme Court said in the case of Hoechst Pharm Ltd. v. State of Bihar, that the result of obtaining the assent of the president in respect to a state act which was inconsistent with a previous Union law relating to a concurrent subject would be that, the state law would prevail in that state and it would override the provisions of the Central act in that state only.
In Chhotabhai Jethabhai Patel and Co. v. State of Madhya Pradesh and ors. The court said that a state may legislate on an item in List III and such legislation will be perfectly valid if it does not conflict with a piece of legislation of parliament or with existing law as defined by the constitution. But in the present case, there is a conflict with the law of the parliament and hence it should be declared invalid. Therefore, the notifications/ordinances are not valid as the assent of the president has not been taken and hence due to lack of proper procedure they stand invalidated.
The Notifications/Ordinances Are Also Violative Of Fundamental Rights
Justice Chandrachud held in a judgment that “suspension of labour laws will be a major violation of fundamental rights and Directive Principle of the State Policy.”
Article 39 of the DPSPs, urges the State policy to ensure “adequate means of livelihood”, while Article 43 is broad enough to encompass workers in agriculture, industries, or even daily wage-earners, where the State must ensure “a decent standard of life and full enjoyment of leisure and social and cultural opportunities…”. These notifications by suspending various significant laws would violate the fundamental rights like the right to livelihood, dignity, living wages, and protection from exploitation, etc.
In the case of Narayanaswamy and Others, Etc. v. State of Karnataka And Another decided on 11 March 1991, any person in this country (citizen or non-citizen) has his or its guaranteed rights, guaranteed under Part III of the Constitution. An Ordinance issued by due deliberation and in full bona fide exercise of the power (i.e., considering all relevant circumstances and eschewing irrelevant considerations), would still be liable to be struck down if the Ordinance offends any of the fundamental rights.
The Factories Act, 1948 which ensures basic safety and other facilities like water, hygiene, electricity, and canteen will also be compromised due to this ordinance. In a landmark judgment of Consumer Education & Research union of India & Others the court observed that “employer is duty-bound to provide a safe and secure condition of work as the same is a part of his right to life with dignity enshrined under article 21 of the constitution.”
In D.K. Yadav v. J.M.A. Industries, The Supreme Court has held that the right to life enshrined under Article 21 includes the right to livelihood and therefore termination of the service of a worker without giving him reasonable opportunity of hearing in unjust, arbitrary and illegal. As after the Industrial Disputes Act, 1947, suspension this right of being heard would also be suspended.
Uttar Pradesh has seen to it that its ordinance will not impact minimum wage, or health and safety welfare, as health-related provisions in the “Building and Other Construction Workers Act, 1996 and Factories Act, 1948 will continue to apply.”
In the Factories Act, 1948, the working hours of adults under Section 51 are not to exceed 48hours per week, and under Section 54 the per day working hours would be limited to a maximum of 9hours, with a mandatory period of rest of at least half an hour after working continuously for 5 hours (Section 55).
Under Section 59, wages for work exceeding the permissible limit of 9hours per day would entitle the worker to double the wage rate for the overtime work. But States are contemplating that the wage rate for the overtime hours would be proportionate to the per hour wage rate given for the regular hours. 
For example, if the wage rate for working 9hours is Rs 90, then the wage rate for working 11 hours would be Rs 110. Without the ordinance, the wage beyond 9hours would be double, so if Rs 10 is the wage rate per hour, the overtime of 2 hours would imply that 40 Rs would be earned(2 hours overtime*20 Rs). In the sum, it would mean that for 11 hours, the worker would earn Rs 130.
For the daily wage-earners, who are just a step above poverty, this shortfall of Rs20 would act as a world of difference. Karl Marx’s statement that “The pay of the common soldier is also reduced to a minimum — determined purely by the production costs necessary to procure him”, would not be an exaggeration. This reduction of wages is an exploitation of the worker, and Karl Marx’s theory of surplus-value of labour would apply here. While the worker struggles with even getting basic subsistence, the capitalists would simply be lining their own pockets with the surplus that should rightly be distributed with the workers.
Conclusion / Towards Reviving The Economy While Upholding Workers’ Rights
The harsh reality of COVID pandemic is that it has not spared even the employers, and the manufacturing and allied services sector alone “faces 1.5 crore job losses due to order cancellations”.
Providing a kick-start to the economy through flexible labour rules seems to be the way forward. In the Olga Tellis v. Bombay Municipal Corporation case it was ruled that the word life includes “Right to livelihood” also under article 21. An equally important facet of that right is right to livelihood because no person can live without the means of livelihood.
To provide workers means of livelihood it was necessary to suspend few laws. However, provisions ensuring safe working environments, health facilities, consideration for women labourers, the prohibition of child labour, paying minimum wage rate, and giving appropriate overtime pay as stipulated in the Factories Act, 1948, should be held sacrosanct.
Clearly, what State Governments must do is follow a middle-path that would impose lesser restrictions on the job-providers, while also maintaining workers’ inalienable rights.
- Priyanka Guleria, Student, National University of Study and Research in Law, (NUSRL), Ranchi
- Madhvi Wadhawan, Student, Rajiv Gandhi National University of Law, (RGNUL), Patiala
 People’s Union for Democratic Rights v. Union of India, (1982) 3 SCC 235, pg 241.
 Id, Para 15, pg 260.
 Id (V Gopal Gowda).
 Constitution of India, 1950, Art. 254(1).
Deep Chand v. State of Uttar Pradesh, AIR (1959) SC 648.
 Constitution of India, 1950, Art. 254(2).
Hoechst Pharm Ltd. v. State of Bihar, AIR (1983) SC 1019.
Chhotabhai Jethabhai Patel and Co. v. State of Madhya Pradesh and ors, AIR (1966) MP 34
People’s Union for Democratic v. Union Of India & Others, (1982) 3 SCC 235.
 Constitution of India, 1950, Art. 43.
Narayanaswamy And Others, Etc. v. State Of Karnataka And Another, AIR (1992) Kant 28
Consumer Education & Research v. Union of India & Others, (1995) AIR 922
D.K. Yadav v. J.M.A. Industries, MANU/SC/0529/1993.
Olga Tellis v. Bombay Municipal Corporation, AIR  SC 180