Protecting unorganised sector workers | The Financial Express

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From proactively defining gig and platform workers to facilitate their inclusion in policy decisions to social security cover through various schemes, India has been taking concrete steps in the interest of unorganised sector workers

unorganised sector, informal sector, global skill demandsThe widening gulf between the skills required by an economy vis-a-vis those available created a skill gap across countries, moving away from equilibrium in employment and investment attractiveness. (Representative image)

By Bhupender Yadav

Megatrends such as globalisation, demographic shifts, and climate change have reshaped economies, industries and societies at an unprecedented rate over the last decade or so. They have driven a rapid global transformation in operation systems, enterprise structures and marketing, and have now started influencing global skill demands. The Covid-19 pandemic and cost-of-living crisis only added to its steam. The widening gulf between the skills required by an economy vis-a-vis those available created a skill gap across countries, moving away from equilibrium in employment and investment attractiveness.

Today, four of the top five global companies in terms of market capitalisation and over 70% of Indian unicorns are platforms. Forecast also suggest that platforms would directly affect around 30% of global economic activities in the near future. India realised the enormity of the opportunity and looked to play a significant role in mitigating the global skill gap crisis. Thanks to initiatives like Digital India, the Indian youth is now well equipped with new-age skills and India has earned itself the reputation of being a bankable exporter of skilled services. During 2021- 22 alone, India’s estimated software service exports ascended by 17.2% to $156.7 billion. Through the optimal use of the gig and platform economy and India’s demographic dividend, the global skill gap could be significantly bridged. These developments have increased employment opportunities for the unorganised sector workers, especially in Tier 2 and Tier 3 cities, allowing them to gain productive employment.

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Amidst all this, the debate on ‘what is the future of work’ has been rife among employers. While gig and platform employment provide a lucrative source of human capital for employers, it also exposes workers to various risks in the absence of a traditional employer-employee relationship. The government shoulders the responsibility to ensure that all workers, regardless of their employment status, are protected from exploitation. This includes ensuring that they have access to basic labour protections such as minimum wage and provisions of basic occupational safety, along with benefits of social security.

The International Labour Organisation, in its report, highlighted the low social protection coverage among online platform workers and pointed out that only 40% of such workers have health insurance, while only 20% have access to old age protection schemes. While few countries like Spain, Italy and Belgium have included provisions in their legislature to include platform workers within their social security net, initiatives by others remain scarce, with a lot still remaining to be achieved.

The Modi government has proactively provided a legal definition for gig and platform workers in the new Labour Codes, enabling them to be included in all policy decisions, while also extending necessary protection to them. The codes specify mandatory provisions of gratuity, employee compensation and minimum wage, insurance, provident fund, and maternity benefits to the employees, in addition to creating a social security fund for gig and platform workers. They also impose an obligation on platform aggregators to contribute 1-2% of their yearly revenue to the fund.

Additionally, the launch of the E-Shram portal has proved to be a complete game changer for the entire unorganised sector, as it has provided the government unprecedented access to data pertaining to about 29 crore unorganised sector workers. Linking E-Shram data to Aadhar ensures that all of them are covered under the purview of government’s social security benefit net and are credited their rightful dues directly into their bank accounts.

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The government, through its actions has consistently demonstrated empathy towards the workers of the unorganised sector, who, until recently, remained devoid of any social security benefits, even after contributing to almost half of India’s GDP. The Pradhan Mantri Shram Yogi Maandhan Yojana was introduced as a contributory pension scheme to provide old-age protection to the unorganised workers. Voluntary insurance schemes like the Aam Admi Bima Yojana and Pradhan Mantri Suraksha Bima Yojana were established to provide accident, death and disability insurance covers to the poor, especially in the unorganised sector. During the testing times of the Covid-19 pandemic when thousands of workers were left stranded far away from their homes, the government announced the Pradhan Mantri Garib Kalyan Package which provided a host of relief measures to them, thereby helping them sustain.

India, through its G20 presidency, aims to build a consensus on an international skill gap mapping portal for all member countries and agree on a global ‘Skill Taxonomy’ to provide a common language to describe and assess the skill needs, thereby increasing transparency in the labour market. Additionally, through the G20 EWG (Employment Working Group) platform, India seeks to reach a consensus on potential policy options, such as social insurance and tax-financed schemes, to ensure sustainable financing of social security, keeping each country’s fiscal constraints in mind. This is also in accordance with UN SDG 1.3, which calls for the implementation of nationally appropriate social protection systems and measures for all by 2030. Through collective and coordinated international efforts, the global skill gap crisis can be successfully alleviated and there would be sustainable financing of social protection, ensuring well-being of all workers including gig and platform workers.

The author is Union minister for labour and employment, and environment, forest and climate change

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