The aim of the
Globalisation is to have unfettered flow of finance capital the world over.
While the maximisation of profits is in any way an integral part of capitalist
dynamics from its inception, globalisation seeks to crush in a frenzied pitch,
all the rights of the workers won over decades to take the law of maximisation
of profits to unprecedented levels. In this process, Globalisation has brought
out some important trends in the production process, seeking legislative changes
which are affecting their job opportunities, working and living conditions,
pushing the workers’ lives to the brink.
Though every section
of society was hit by this imperialist onslaught, the attack on workers is more
direct and severe. The first causality in this attack is the declining
employment opportunities i.e their source of living itself. The second serious
impact on the working class is their deteriorating working conditions.
Unemployment escalating to the
According to the
recent round of the national surveys the unemployment rate in India is 7.2% i.e.
about 7 crore people. This is despite the fact that about 55% of the people are
figures published by the government are grossly under-reported and misleading.
The official unemployment rates are low because the poor never get themselves
into the registers of unemployment. According to the latest World Bank report
the poverty in India is about 32%. In other words much of the employment is not
The earlier clashes
in Assam and elsewhere in the country on the issue of Railway recruitment is a
glaring example showing the acuteness of the problem. According to Railway
official sources they have received about 74 lakh applications for 2000
vacancies. While the qualification required for these posts is a pass in Class
VIII, graduates and post graduates including 20,000 engineers and 3,000 MBA
degree holders were among the applicants.
The major reasons for
this escalating unemployment are the de-industrialization process swaying
throughout the country and the reduction of jobs for cutting costs at a feverish
pitch as globalisation is underway. Because of liberalization policies, Indian
markets are flooded with MNC products. The MNCs are crushing already beleaguered
small capital. Unable to face the competition from the MNCs many small scale
industries, which are the main employers are closing down. The onslaught of
globalisation is such that under the wheels of juggernaut through privatisation
the huge Public sector companies are sold to the MNCs and the big bourgeoisie
for a song. In the last few years six lakh units have closed down and millions
of people have been thrown out of their jobs. Even the Report of NCL, 2002 which
avowedly supported the globalsiation process and suggested anti-labour policies
too can not ignore the reality staring on the face: "A large number of
workers have lost their jobs due to VRS, retrenchments and closures both in
organised and unorganised sector. Exact number is not available. No data have
been compiled by any State governments"
Cutting down the wage
bill has become the thrust area for the imperialists. All the technological
improvements and mechanization are centered around the concept of ‘jobless
growth’ i.e. increasing the production and reducing the workforce. New
industries established by foreign capital have not created enough jobs to absorb
those who lost jobs in the process of de-industrialization.
According to the
report of May 2002, a special group on Employment opportunities constituted by
the Planing Commission, the rate of employment growth had declined from an
annual average of 2.8% in the period 1983 and 1993-94 to 1.07% in the period
between 1993-94 and 1999-00. This happened despite a significant acceleration in
the recorded rate of economic growth, from an annual average of 5.2 percent in
the earlier period to 6.7 percent. As a result of this the unemployed population
had increased from 20.13 million to 26.58 million.
The condition of
those who are employed is no better. Most of the workers in India are not only
under-employed but working under horrible working conditions and increased work
pressure. Flexibility of deployment of labour is the new mantra of the
globalisation period. Flexibility of labour means employing labour at the whims
and fancies of the employer. Workers are hired and fired as per the convenience
of industrialists. Keeping the workers whenever there is a demand for their
products and firing them when the demand falls. This flexibility of hiring
workers facilitates the management to maintain the wage bill at the minimum
level and pushes workers into permanent uncertainty.
asking for freedom in dealing with workers. Because of this approach of
industrialists, the status of worker is undergoing a see a change. "Restrictions
on the hiring and firing of workers are identified as one of the challenges of
doing business in India". The imperialists and big bourgeoisie want ‘hire and
fire’ policy to be legalised. This is the remark of World Development Report,
despite the fact that more than 90 percent of workers are under the unorganised
sector who do not have any protection of labour laws whatsoever.
According to the
Second National commission on Labour Report, a mere 8.3 percent of the Indian
labour force is organised, the majority of which mainly belongs to the public
sector. Estimates say that no more than 2 to 3 percent of the labour force in
India has access to assertion of labour rights through the collective bargaining
The new trend in
industrial production is outsourcing. Outsourcing or contracting out is a
process to get certain activities outside their expertise through contractors.
This will not only reduces the management’s burden but also becomes economical.
Though outsourcing was an age-old practice in the manufacturing industries, now
it has become an important phenomenon to reduce the cost of production. Since
the contractors generally employ casual workers who are generally unorganised
and don’t have any job protection or wage protection and hence become a most
vulnerable section of the working class.
Casualisation of the
work force is another important feature in the current production process. Most
of the firms are taking casual workers in place of regular employees. Even for
regular and continuous production work they are using temporary workers. With a
large reserve army of unemployed it is not difficult for the industrialists to
find a continuous inflow of temporary workers. Using contractors for supplying
labour is another important method of having casual labour. This casual labour
is not only denied benefits like minimum wages, compe-nsation, insurance,
medical, provident fund, etc, their right to form unions to protect their
interests is also undermined.
In this way workers
are the direct victims of Globalisation. In this present phase of Globalisation
to enhance the profitability by cutting down the wage bill the whole production
process is being restructured. This restructuring process has adversely affected
the working class.
Since the late 1970s,
a relentless process of casualisation of employment has been under way. In 1983,
31.5 percent of the employees are recorded as casual, 7.5% were salaried and 61
percent self employed. According to the National Sample Survey records of
1999-00, the casual employees increased to 37.3%, salaried employees decreased
to 6.7% and self employed has fallen to 56%.
The decline in the
already modest contribution of the organised sector shows the same trend of a
rapid deterioration in the quality of employment. In 1990, the total employment
in the organised sector, with the public sector amounted for over 71% of the
total. Up to 1997, there was some increase in the employment of organised sector
and after that there is some steady decline. In the net, recent figures
available for the year 2001, the organised sector is 27.79 million of which
about 69% is in the public sector.
Another trend the
present day production system is using multi-skilled workers. It means using the
same worker from different operations to do other jobs. This has considerably
increased the work pressure on workers and saved money for the capitalists. In
modern management terminology this is also called as "functional flexibility".
As a result of
bringing so-called labour flexibility and the international competition, which
led to increased emphasis on reducing costs, mainly labour costs, in order to
retain both domestic and international markets, labour saw the erosion of many
benefits which they had earned through past struggles. It leads to further
segmentation of the labour market and the expansion of low-income informal
sectors in the economy. This process was accompanied by increasing casualisation,
contract labour, subcontracting, house working and lengthening of working hours.
Another aspect which
has seriously affected the working class is with liberalisation and structural
adjustment policies, agricultural subsidies were cut and the food prices are
moving towards international prices which are typically higher than domestic
prices. As workers both in urban and rural area as well spend a large share of
their income on food, the real wages of the workers have gone down adversely
affecting their living standards.
With the introduction
of mechanization, demand for skilled workers would increase and the gap between
the wages of skilled and non-skilled worker will increase. Various studies
conducted in the underdeveloped countries, which have undertaken trade
liberalisation under the directives of the WB and IMF have empirically shown
that wage inequality has considerably increased.
The impact of
globalization is more severe on women. Many supporters of globalization claim
that it is creating more employment opportunities but the fact is that woman
employment has increased only marginally. And it is only in the flexible and
cheap labour category catering mainly to the needs of contract works and the
informal sector. Of course there has be an increase as sex objects in the
tourism, advertising and entertainment sectors.
There is another
factor for women employment. With the drop in the primary worker’s wages and
employment, women are typically called upon to help sustain household income. In
other words, more women are pushed into the labour market. According to World
Development Report [WDR] (1995) relative position of women has often
deteriorated under structural adjustment, because women, who are mostly employed
in low-wage informal sectors are more vulnerable than men.
The reforms with the
help of the restructuring process, have further accelerated the segmentation of
the labour market through informalisation of the economy which has spelt
deterioration of labour standards. More and more skilled and unskilled workers
retrenched from the formal sector have sought employment in the informal sector.
Changes in labour
The MNCs and big
bourgeoisie want key changes in the labour laws. They argue that labour is over
protected. The essence of their endevour is to nullify all the rights won over
the decades through the change of labour laws. Their essential target is on two
pieces of legislation. They want freedom to close industrial units and they want
to use contract labour as the primary method of employment (whom they can hire
and fire at will). The Industrial Disputes Act, the legislation which most
employers clamour for abolition. The industrial dispute Act of 1947 whose stated
objective was to protect workers from the threat of unfair dismissal and with
lot of loopholes accept the right to strike by the workers. The other one is The
Contract Labour (Abolition and Regularisation) Act, 1970. It is obvious that
industrial houses will greatly benefit if these two legislations are dismantled.
Companies can hire and fire at will on contractual terms that are far more
onerous for workers.
The Second NLC has
recommended on changes in labour laws on the same lines as demanded by the MNCs
and big bourgeoisie. Its recommendations free are to employers from the
obligation of obtain-ing prior permission from the government for closing down
establishments employ-ing up to 300 workers. Worker will however be entitled to
two months’ notice or pay in lieu of notice in case of retrenchment.
The employees of
units, with more than 20 and more workers could be closed by payment of 20 days
salary. This category includes the majority of industrial units India.
In this new economic
environment of stabilisation and adjustment programmes, firms are responding by
introducing new technologies and workplace laying-off business, retrenching
workers and cutting costs. These new technologies are supposed to engender
economic growth by bringing about increasing levels of productivity, efficiency
and profitability. The speed of operation, labour saving, accuracy, variety,
quality of product and reliability, are the most distinguishing characteristics
of the new technologies from the management point of view. However major
undesirable side effects of the new technologies are related to its negative
impact on employment and job impoverishment.
offering VRS often require more workers. Therefore they offer VRS to their
permanent workers, claim Income Tax benefit on their compensation and
simultaneously recruit as temporary or badli workers who are not only
relatively less costly but are also more "flexible".
The offensive of capital is
See how the NCL
reports of this phenomenon after the post "reforms" period, noting that there
are more man days lost due to lockouts rather than to strikes (13 crore due to
lock outs, and 8 crore due to strikes between 1991-2000). The NCL admits:
Conditions of employment have been uncertain, and many workers do not seem to be
willing to go on strike or resort to action that may put their jobs in jeopardy.
But employers seem to have acquired more confidence and are resorting to
lockouts more often. The agreements that are arrived at too are more in favour
of the managements. This reflects a changed situation.
The downsizing of
industrial units, VRS, shrinking job market, changing of labour laws in favour
of employers are all part of the changing industrial scenario in the
globalisation period. The judiciary which is part of the regime is playing its
anti-worker role. There are a series of Supreme Court decisions, which patently
serve the neo-liberal agenda of the imperialists and big bourgeoisie. The SC’s
dictum of banning or restricting bandhs, its stamp on the most draconian law —
ESMA, and the amended version of it by TN government, its pronouncement of
making all strikes by government employees as ‘morally and legally invalid’
thus striking at the very roots of the rights of the people. Its recent outpour
is on ‘violence’ of workers at the time of hartal or strike, are all
indications on how the judicial system has fully backed the imperialist agenda.
unprecedented. The summary dismissal of over one lakh employees in TamilNadu is
a clear signal. Workers have to take up the new challenge and respond. Thousands
of workers are already are on the streets who became victims of the
liberalisation process initiated in the 1990s.
Imperialism and all
exploiters are monsters with clay feet. If the working class rises like a
tornado like in the Paris Commune, or in the Bolshevik revolution and in various
social revolutions, the monsters will be swept away. The Indian working class
has to play its historical role. Then oppression will come to end.