NEWS  The universalisation of social security remains an unfulfilled aspiration in the new code on social security.

CONTEXT 

• COVID-19 has destroyed lives and livelihoods, particularly, the low-paid, informal workers, who constitute 91% of the workforce.
• Further unpreparedness of the government has left them helpless, pushing them further into poverty.
• This has raised the need of social security for informal workers, including free basic curative care in public clinics and hospitals, the elderly had old age pensions, the dying had death/disability insurance or life insurance.

SOCIAL SECURITY CODE 2020

• Indian Parliament in September 2020 passed a Social Security Code (SS Code 2020).
• The SS Code 2020 merges existing social security laws and attempts to include informal workers within the ambit of social security administration. It amalgamates and rationalises the provisions of eight existing central labour laws.
• Of these acts, employees provident fund, employees state insurance (ESI), maternity benefit, and gratuity are entirely for organised sector workers. This has remained so even in the new scheme of things.
• For employees’ state insurance, the existing employee threshold has been withdrawn and now the central government can extend ESI benefits to any organisation irrespective of the number of workers employed therein. However, there are areas of ambiguity and overlapping too.

GAPS IN THE CODE

Maternity benefit:

• Under the SS Code, the provision of maternity benefit has not been made universal, similar to previous laws.
• Maternity benefit is presently applicable for establishments employing 10 workers or more.
• The definition of ‘Establishment’ in the proposed code did not include the unorganised sector.
• Hence, women engaged in the unorganised sector would remain outside the purview of maternity benefit.

Employees Provident Fund:

• The SS Code maintains that the Employees’ Provident Fund Scheme will remain applicable, as before, to every establishment in which 20 or more employees are employed.
• Thus, for informal sector workers, access to employees’ provident fund remains unfulfilled in the new code too.

Payment of gratuity:

• Gratuity shall be payable to eligible employees by every shop or establishment in which 10 or more employees are employed, or were employed, on any day of the preceding 12 months.
• But although payment of gratuity was expanded in the new Code, it still remains inaccessible for a vast majority of informal workers.

HURDLES FOR INFORMAL WORKERS

Unambiguous provisions:

• The Code proposes that both the central and State governments will formulate schemes for unorganised workers. But the legal framework as proposed in the Code and Rules, implies that the basic onus lies on informal workers registering as beneficiaries.
• Hence, registration is a prerequisite for universal coverage, and to avail social security, an informal worker must register herself on the specified online portal to be developed by the central government.
• Similar provisions are already there in existing social security schemes run by State governments under the Unorganized Workers’ Social Security Act, 2008.
• Still, a large number of informal workers are outside the ambit of any social security even after 13 years.
• Therefore, it is clear that absence of definite and unambiguous provisions in the present code would further complicate achievement of universal registration.

Lack of awareness:

• Experience shows that there is an awful lack of awareness among informal workers regarding social security schemes.

Lack of digital literacy:

• Online registration places a further challenge as most informal workers lack digital literacy and connectivity.

Lack of documents:

• Most informal workers are footloose casual workers (26% of all workers) and self-employed (46% of all). They move from one place to another in search of livelihoods.
• Hence, they also lack documentary papers required as part of the registration process.

INTER-STATE COOPERATION IS MUST

• As unorganised workers are spread across the length and breadth of India, inter-State arrangement and cooperation becomes imperative.
• The central government should conceptualise a basic structure, which if successful, should be adopted by States after necessary customisation. Without such a basic structure, implications of this code would be too varied across States to be administered.
• Thus, both Centre-State should cooperate to provide holistic social security cover for the unorganised workforce in a simple and effective manner.
• The unorganised workforce is all encompassing, minus the minuscule regular workers of organised sectors. This identity should be primal and all unorganised workers should have basic social security coverage, irrespective of labour market classifications.

LOST OPPORTUNITY

• The provision of social security could be used to formalise the workforce to a certain extent.
• Employers could have been made to own up to the responsibility of providing social security to their workers. The state has a responsibility but the primary responsibility still lies with employers since they are taking advantage of workers’ productivity.
• But the code fails to undertake inclusion of the unorganised sector in a meaningful way.

CONCLUSION

• The SS Code 2020 remains a collage of existing pieces of legislation without that interweaving thread of integration.
• At a time when India chairs a BRICS meeting in Delhi (preparatory to a Summit) that is focused on issues of labour, especially informality, it fails to even recognise that India is ageing without social security, and the demographic dividend of the young workforce that could support the ageing ends in 15 years.
• This is a dreadful failure on the part of the state in a time of dire crisis for the nation.

Reference:

1. https://www.thehindu.com/opinion/lead/a-collage-of-laws-that-leaves-the-worker-out-in-the-cold/article34600276.ece