8 hours is now the new 12 hours

In contemporary times, he has possibly replaced Mahatma Gandhi as the human deity who can do no wrong. Like Gandhi is considered the father of the nation, he is known as the father of the Indian Constitution. Criticising him, or his works, thoughts, and speeches can be controversial. I am talking about BR Ambedkar, one of the most fascinating characters in pre- and post-Independence India. Most people may not know or realise this but he is intimately linked to one of the most interesting debates in recent times.

Time and again, the co-founder of Infosys, Narayana Murthy, has advocated that young Indians need to work 72 hours a week. Not just because they need to develop professional careers, but for India to grow into a more successful modern economy. Juxtapose this with Ambedkar’s views on the same subject. Why? This is because before he became the father of the Constitution, and champion of caste upliftment, he was the father of modern labour laws in the country.

Ambedkar was the labour minister in the Indian cabinet between 1942 and 1946. This was still the colonial era, and the cabinet reported to the viceroy of India. During these years, Ambedkar pioneered the laws and reforms that still exist in the labour statute books. Whether one talks about the minimum wages, discusses provident funds, and debates about protection from job losses, his name is intrinsically connected. Even the issue of the maximum number of hours a worker needs to work has his imprint.

Murthy talks about 12 hours a day. Ambedkar passed laws that cut the maximum daily hours from 14 to 8. These reforms, as mentioned earlier, were drafted, and most passed, when the British ruled India. Perhaps the last of this lot of laws was the Industrial Disputes Act of 1947, which was passed soon after the British left India. So, labour reforms and laws predate the Indian Constitution. While the Constitution framed forward-looking and progressive laws and policies, one needs to examine whether they had the desired impact.

The answer, unfortunately, is no. At a macro level, let us look at the impact of the progressive labour laws on the conditions of the workers. One of the most significant aspects is the absence of what is known as a hire-and-fire policy. Any company or factory, which employs more than 100 people, needs formal approvals to shut down. The application must be submitted six months in advance. Quite naturally, the law was aimed to help the workers. The thinking was that the capitalist entrepreneurs habitually and reflexively exploit workers across the world, and fire them on the flimsiest excuses.

But the desired impact was the opposite. Two things happened. Entrepreneurs consistently tried to adopt capital-intensive measures, partially through technology, especially in manufacturing, rather than opting for labor-intensive techniques. For India, and most of East Asia, which modernised since the 1960s, labour was a crucial resource, and surplus factor of production. Nations from Japan and South Korea to Malaysia and China utilised labour as the linchpin, and fulcrum in their massive push for manufacturing.

India did not do so because the entrepreneurs were not interested in setting up large and massive factories that employed tens of thousands of people. This was the reason why, unlike other East Asian economies, India missed the manufacturing bus. Another way of looking at the same scenario is that Indian businesses did not employ scale, with or without technology, because of potential labour issues. It is true that the other laws that restricted expansion, and growth, hampered their plans to build large factories.

The corollary impact was more peculiar. We buy branded products ranging from toothpaste, soap to shampoo, as well as other goods. We presume, quite logically, that since they are made by large business houses, they are produced in the vast factories controlled by these giants. This is not true. Even today, the manufacture of these items is the preserve of the MSMEs, which consciously avoid hiring more than 100 workers to stay under the legal labour radar. Obviously, the pre-reforms laws to procure from small-scale units aided the process.

This partially explains the low number of workers in large plants in the country. Most work for MSMEs, which account for a sizable percentage of manufacturing. This is evident in the textile sector, which claims to provide employment to the largest numbers behind farming. Large-scale job opportunities in modern factories were missing for five decades, and continue to do so. The bulk of Indians work in the informal, unorganised sector.

In earlier columns, I mentioned how the DMK-led regime in Tamil Nadu tried to provide choices and freedom to workers by mandating that they could work 12 hours a day if they so wished. The thousands of women, especially those who worked in the iPhone factories, gladly welcomed the move. After all, it meant a far higher monthly income due to overtime for them. But the critics, and so-called protectors of the labour force protested vehemently. The law was withdrawn. The point is that unlike Murthy’s forced regime, workers need to sometimes decide if they wish to work for 8 or 12 hours.

Therein lies the nub, and therein lies the rub when it comes to the history of labor reforms. There were laudable efforts to protect the workers, but they have remained on paper. I will give you another example to illustrate how these laws are twisted, and made a mockery of. The teachers in private schools are appointed at salaries that are mentioned in their contracts. On pay days, however, they are handed cash, and asked to sign receipts. The discrepancy between the cash, and amount in the receipts can be as high as 50 per cent. In effect, the teachers are paid half their salaries.

The teachers have no options. If they refuse to sign the receipts, they will lose their jobs. This is why the four new labour codes that came into effect need to be implemented efficiently. Mandating that everyone will get contracts, or employment letters, or some firms need to spend two per cent on providing security to gig workers is not enough. This is because most labour laws, for the past 100 years or so, have remained on paper, and never implemented properly.

More than 600 million workers are employed in the informal sector, and it is they who need the help and protection under the codes. They need the support of the governments, not to introduce new laws and codes, but to ensure that they are implemented well.

The author has worked for leading media houses, authored two books, and is now Executive Director, C Voter Foundation