Need to move past binary ways of thinking about workers’ conditions and economic growth – The Economic Times

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Synopsis—With the Covid-19 pandemic, we have yet another crisis on our hands that appears never-ending, obfuscating any clear thinking on fundamental questions: what kind of society do we want to rebuild after the pandemic? How will benefits and burdens be distributed in such a society?

It’s a testament to the complexity of our era that our crises seem to run on like never-ending, overlapping nightmares, leaving little scope for rebuilding. The War on Terror never really ended. The Great Recession of the last decade came and went, yielding immediate lessons on risk management for some, but few, if any, structural changes.

With the Covid-19 pandemic, we have yet another crisis on our hands that appears never-ending, obfuscating any clear thinking on fundamental questions: what kind of society do we want to rebuild after the pandemic? How will benefits and burdens be distributed in such a society?

The Covid-19 pandemic seems at once smaller and larger than some of the defining predicaments of the past like terrorism or the Great Recession. Smaller, since we are, perhaps, viewing matters in a narrower scale of time, and the cadence of history is yet to yield the broader revisions of our age. But its effects already seem to exacerbate existing fault lines between rich and poor, old and young, settled and the migrating.

By now, we are beginning to understand that much of the world is in the unhappy position of being subject to both considerable devastation to livelihoods and the continued threat to lives. This means that the question of reconstruction has somehow arisen even as we are still very much in the throes of the pandemic. How we deal with reconstruction today is an indication of what society might look like post-pandemic.

On October 1, the Supreme Court struck down an order of the Gujarat government exempting factories from following certain worker protection measures. It was hearing a challenge to certain notifications passed by the Gujarat government that raised the upper limit of working hours of factory workers in the state, a limit ordinarily fixed by labour laws.

Having raised the upper limit, the state government felt no need to require factories to pay workers higher overtime rates. The government claimed before the court that this change was needed to offset the ‘public emergency’ created by the effects of the lockdown. Where was the money to retain more workers, or pay them double, going to come from?

The court found that the Covid-19 pandemic had clearly not created the kind of grave emergency that the law required before passing such a blanket notification. It was simply not within the competence of the Gujarat government to mandate additional working hours without overtime pay, contrary to what the law required.

The three-judge bench of Justices DY Chandrachud, Indu Malhotra and KM Joseph harked back to references from our constitutional experience in 1975-77, which have shown that allowing for an emergency, when there is no severe threat of physical violence, can be foolhardy. The pandemic may be an exceptional event, but not the kind of event that the Factories Act (yet to be replaced and promulgated by the recently passed Occupational Safety, Health and Working Conditions Code, 2020) envisaged as a public emergency denuding workers of their statutory due.

As a matter of legal interpretation, the court was undoubtedly correct. The specific words used in the Factories Act plainly did not allow factories to ramp up production, even in a pandemic, with no commensurate benefits to workers.

A new abnormal
But there is more at play here than the text of the statute. Some states have simply avoided the controversy by using Ordinances to exempt employers from providing for workers’ rights. As a result, they don’t need to show the existence of conditions for public emergencies under the Factories Act in the first place. Other states have considered amending their labour laws themselves to expressly grant themselves such powers. So, how should burdens of reconstruction be allocated?

It is trite that to get the economy going again, it cannot be ‘business as usual’. In their emerging definitions of this ‘new normal’, however, several governments appear to be gravitating towards a recovery founded on low wages, longer work hours and, consequently, greater production. But this is a regurgitation of the status quo that is itself under severe scrutiny — increasing work hours may seem to make industries more competitive but they reduce the number of shifts and, thus, the number of jobs.

The circulation of workers’ wages may, in fact, be needed to bolster consumption. Increased work hours may still be genuinely necessary to ensure the speedy production of goods that are truly essential at this time, like medical equipment. But the terms on which workers perform these additional tasks require a parsing of evidence, rather than a simplistic dilution of existing protections.

The true effect of the Supreme Court judgment is that we must consider the alternatives to reactionary ways of thinking about relationships between working conditions for labour and economic growth. Decades of overzealous labour protection may well have hampered industrial growth, as much as contractual relationships have typically failed to provide workers their due. The judgment provides us a point of departure to write a new post-pandemic script. In our hurry to escape misfortune, we must not let the chance slip by to learn worthwhile lessons from our current crisis.

Sengupta and Panda are research director and senior associate fellow, respectively, Vidhi Centre for Legal Policy.

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