Labour ministry examining proposal to bring wages of contract workers at par with regular workers

By Yogima Sharma, ET Bureau | 12 Jun, 2015, 04.21AM IST

The labour ministry is reexamining its proposal to bring wages of contract workers on a par with those of regular workers, evoking strong reactions from trade unions that allege that the government is backpedalling under pressure from corporates. 

A senior labour ministry official said the proposal is being reconsidered because the existing salaries of the regular workers are not in sync with market rates. "Over a period of time because of better negotiating powers of regular workers, their salaries have gone up significantly, which is not in sync with market rates. Hence, we are relooking at it and hope to finalise the changes within two-three months," the official told ET on condition of anonymity. 

Contract workers account for 55% of public sector jobs and 45% of all private sector jobs in the country and raising their salary to the levels of regular workers would lead to significant cost escalation for employers. 

An estimate suggests that bringing contract workers' wages and benefits on a par with regular workers would cost the central government alone more than Rs 10,000 crore every year because of the sheer number of public sector companies. 

Employers mostly prefer contract workers owing to the flexibility of terminating their service as well as the fact that contract labourers are paid much less than permanent workers in a country like India with high unemployment levels. 

As part of its amendment to the Contract Labour (Regulation & Abolition) Act, 1970, introduced contract workers on the rolls of in July last year, the ministry had proposed to add new sections under the existing Act to ensure that contract workers are paid the same wages and social security benefits as regular workers for the same work. 

The ministry's move to go back on this has prompted sharp criticism from trade unions, including the RSS-affiliated Bharatiya Mazdoor Sangh (BMS). 

Vrijesh Upadhyay, all 

India general secretary of BMS, said the country's largest trade union will not settle for anything less than same wage and benefits to contract workers as entitled to a regular worker in the same grade. "If the government deviates from this, there will be an acute crisis as trade unions will not settle for anything less than the same entitlement under a particular grade to contract workers vis-a-vis regular workers," he said. 

Ashok Singh, vice president of Indian National Trade Union Congress (INTUC), said the Congress-affiliated union would not support any proposal where contract workers are3 paid less that regular workers. "How can you expect them (contract workers) to work at lower wages than their counterparts in regular jobs when commodity prices are touching the roof ?" he said. 

Trade unions have been accusing the Narendra Modi government of being pro-corporate after the government introduced a series of changes in the archaic labour laws of the country over the last one year in the name of labour reforms. "This government is pro-capitalist," INTUC's Singh said. Out of an estimated 80 million contract workers in the country, a mere 300,000 are employed in the organised sector. The rest —almost 80 million — are deprived of social security benefits.

 

Source:-http://economictimes.indiatimes.com/