New labour laws should be productive

Standing Conference of Public Enterprises (SCOPE) as an employers' organisation of public sector enterprises is a member of the Council of Indian Employers. SCOPE's director general UD Choubey spoke to Hindustan Times on a range of issues, including contract labour in government-owned enterprises. Excerpts:

You recently participated in the Indian Labour Conference as a delegate on behalf of Council of Indian Employers and Public Sector Employees. What is your general assessment?
The common concern during the conference was employment generation, social security of labour particularly contract labour, economic development and skill development. The direction as given by the Prime Minister was that ‘industry and employee must move together to achieve objectives for inclusive growth'.

It is learnt that the government is very keen to bring further legislation or regulation on equal pay to contract labour. What is your view?
Currently, around 447 million people are employed, out of which almost 93% are contract labours. Further, one-third of the total contract labour is under licensed category and the rest are unlicensed through sublet contractors. It is true that social security in respect of contract labour is on top priority not only for government but also for employers, particularly public sector employers. SCOPE endorses the views of the government. But at the same time we must keep in our mind that any hard and rigid legislation may become counter-productive as there may be cutting down the number of employees by employers particularly in the private sector.

Can you please elaborate?
The poverty alleviation in our country has remained a matter of paramount importance for successive governments. Still, many people are below the poverty line. Out of the large contract labour, majority are engaged as sweepers, loaders, transporters and agricultural workers. They work during the day to earn their livelihood so that they can feed themselves in the evening. Any reduction in job position for such contract labour because of the hard regulations will bring larger people below the poverty line and will go against the goal of inclusive growth.

What is the way out?
Legislation should not inhibit, undermine and frustrate any effort that is required for socio-economic growth of the country. Flexibility may be required at least till the time people are brought above the poverty line. The better course would be to create larger job for unemployed by way of developing skill for the unemployed youth.

Do you think that industry will suffer because of the higher cost of production?
Yes. Increased cost of production will bring down the margin for industry and it will be difficult to compete in the international market as a result of which export earnings may come down heavily.

First Published: Nov 28, 2010 23:38 IST