Role of Trade Unions after Labour Reforms – UPSC GS3

  • Labour law reform has been on the table since 1991 as every government’s favourite solution for economic growth. Yet, there was no consensus between governments, political parties, workers and their trade unions, and employers, on what this meant.
  • In 2019, the Central Government introduced four bills on labour codes to consolidate 29 central laws.
  • While the Wages Code was passed in 2019, the other three bills were referred to a Standing Committee on Labour. As per the recommendations of the Committee, the government replaced these bills with new ones in September 2020, and these were passed in the same month.
  • The government, in 2020 passed three Bills (Labour codes) to amalgamate laws on social security, occupational safety and health and industrial relations.
Labour Reforms ignored Trade Unions:
  • Concerns are being raised that the Central government has actively excluded trade unions from pre-legislative consultations on drafting the new labour codes, repealing all existing labour laws and replacing them with four new labour codes.
  • It is opined that they dilute workers’ rights in favour of employers’ rights, and together undermine the very idea of workers’ right to association and collective action.
Long History of Trade Unions:
  • Trade unions first emerged in the 19th century as self-managed organisations of workers in the face of extreme exploitation.
    • They provided, and continue to provide, a collective voice to working people against employers’ exploitative, unfair and often illegal practices.
    • It is through trade unions that workers have been able to win better wages, fairer employment conditions, and safe and secure workplaces.
    • It also provided members (workers) and elected officers of a union a degree of immunity, including against the law on criminal conspiracy.
    • The law recognised that actions based on collective decisions by workers were legal and did not constitute a criminal conspiracy.
  • In India, workers won the legal right to form trade unions under the colonial rule in 1926, when the Trade Union Act (TUA) was adopted.
    • The law provided a mechanism for the registration of trade unions, from which they derived their rights, and a framework governing their functioning.
    • The TUA also bound workers’ actions within a legal framework by providing for deregistration if a trade union “contravened any provisions of the Act”.
  • The creation of the Industrial Relations Code (IRC), has a very sinister outcome for workers’ right to association.
    • The code widens the grounds under which a trade union may be deregistered.
    • Under the TUA, deregistration was limited to the internal functioning of a union — in case a union violated the financial rules set down under the law or its own constitution.
    • The Standing Orders Act and the Industrial Disputes Act had nothing to do with the internal functioning, and, therefore, with the existence of a trade union.
Vague definitions:
  • Under the new IRC, a trade union can be deregistered for contravention of unspecified provisions of the code.
    • The possibility of deregistering a trade union in this unspecified manner shifts the balance completely in favour of employers, who continue to enjoy protection under the Companies Act.
    • This violates the principles of equality before the law and of natural justice.
  • When a trade union is deregistered, it can no longer represent its members (the workers) before the dispute resolution machinery or in court and any collective decision taken by its members and elected officers can be treated as illegal.
  • The new code would deter collective action by workers’ unions.
Extra-legal formations:
  • With the threat of deregistration ever-present, workers and their unions will be pushed to create extra-legal formations like ‘struggle committees’ and ‘workers’ fronts, that existed before the TUA, in order to advance their demands against unreasonable employers.
  • This would have two outcomes:
    • It will push employment dispute resolution outside the legal framework.
    • It would lead to criminalising working-class dissent, since workers’ agitations will have to take place through extra-legal formations.
Once a trade union is deregistered or is effectively silenced by a constant and amorphous threat of deregistration, workers effectively lose their fundamental right to freedom of association. This has grave implications for the working class’s ability to defend its rights.
Related Questions:
  • Undermining the trade unions poses a grave challenge for the working class in their ability to defend their rights. Examine the statement in light of the newly introduced Labour Codes.
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