Dilution of labour laws is unconstitutional

COVID-19 may be the most devastating pandemic the modern world has ever seen, but it still does not qualify as a public emergency for the purposes of the Factories Act, 1948, as it stands currently.
For instance, the provisions of the Factories Act, 1948, have been suspended. (Photo|Martin Louis, EPS)
For instance, the provisions of the Factories Act, 1948, have been suspended. (Photo|Martin Louis, EPS)

The outbreak of the COVID-19 pandemic has resulted in not only an unprecedented humanitarian crisis, but an economic crisis as well. The response of some state governments to the closure of factories and businesses on account of the nationwide lockdown has been to introduce ordinances to dilute the effect of labour laws. The Uttar Pradesh Temporary Exemption from Certain Labour Laws Ordinance, 2020, suspends the operation of all labour laws in the state for a period of three years, with the exception of the Bonded Labour System (Abolition) Act, 1976, and certain provisions relating to the security of the workers under the Factories Act, 1948, and Building and Other Construction Workers (Regulation of Employment and Condition of Service) Act, 1996. It further provides that work hours can extend upto 11-12 hours a day.

Similarly, Madhya Pradesh has brought in the Madhya Pradesh Labour Laws (Amendment) Ordinance, 2020. News reports also indicate that other states, including Karnataka and Gujarat, are planning to or are in the process of passing similar ordinances. The moves have received mixed reactions. While large corporations and organisations such as FICCI have welcomed it, trade unions and large sections of civil society have condemned them, for it is essentially the state governments leaving the workers in the lurch by taking away the most basic protections that the law has to offer them.

However, apart from the policy and ethical ramifications, it is crucial to also examine the constitutional ramifications of the promulgation of such ordinances. India is a founding member of the International Labour Organisation (ILO). Of the eight Core Conventions of the ILO, India has ratified six. These are Forced Labour Convention (No. 29); Equal Remuneration Convention (No.100); Abolition of Forced Labour Convention (No.105); Discrimination (Employment Occupation) Convention (No.111); Minimum Age Convention (No.138); Worst forms of Child Labour Convention (No.182).

While the other two, Freedom of Association and Protection of Right to Organised Convention (No.87) and the Right to Organise and Collective Bargaining Convention (No.98) have not been ratified by India yet, the public position of the Ministry of Labour and Employment itself is that the ILO conventions serve as a guiding law for labour laws in India, and the government strives to bring domestic labour law at par and in conformity with the high standards set by the ILO conventions. India has also ratified Tripartite Consultation (International Labour Standards) Convention, 1976, which enforces the tripartite consultation process between the country, employer and workers that is at the heart of the spirit of the ILO. These ordinances prima facie are in clear violation of the ILO Conventions, which are a globally recognised standard of what domestic labour laws should aspire to be.

Further, these ordinances are also prima facie in contravention of the provisions of the Acts themselves. For instance, the provisions of the Factories Act, 1948, have been suspended. The power to suspend the operation of the provisions of the Factories Act, 1948, is found in Section 5, which confers power on the state government to exempt any factory or a class of factories from the provisions of the Act. But it is crucial to keep in mind that this power can be exercised only in case of a ‘public emergency’. The term public emergency for the purpose of the Factories Act is defined as a ‘grave emergency whereby the security of India or of any part of the territory thereof is threatened, whether by war or external aggression or internal disturbance’. COVID-19 may be the most devastating pandemic the modern world has ever seen, but it still does not qualify as a public emergency for the purposes of the Factories Act, 1948, as it stands currently.

It is now a well-settled principle of law that the power conferred on an authority to do something must be exercised in that manner or not at all. Thus, to the extent these ordinances suspend the operation of even one provision of the Factories Act, 1948, vis-a-vis a single factory, they are violative of Section 5 and thus, patently illegal. Another crucial aspect that requires careful consideration is the issue of federalism. In the case of both the UP and MP ordinances, the assent from the President has not been received yet. Labour laws are found at Entry Nos. 22-24 of List III of the Seventh Schedule of the Constitution of India. Article 254 of the Constitution lays down the scope of the Centre and states to legislate on subjects in the concurrent list.

Article 254(1) provides that when a law enacted by Parliament holds the field, then the law enacted by the state shall be void to the extent it is repugnant to Parliament law. Article 254(2) however, provides an exception to Article 254(1) and provides that the repugnancy can be cured if the assent of the President is received, and that law shall prevail in the state once the President assents to the same. This provision is often employed by state governments to introduce specific provisions for their state on subjects that fall in the concurrent list. In a landmark judgment ‘Kaiser-i-Hind Pvt Ltd v. National Textile Corporation (Maharashtra North) Ltd.’ [(2002) 8 SCC 182], a Constitution Bench of the Supreme Court held that the giving of assent is not an ‘empty formality or an automatic event necessitated or to be given for the mere asking’ of a state government.

It further held that: “In a federal structure, peculiar to the one adopted by our Constitution, it would become necessary for the President to be apprised of the reason as to why and for what special reason or object and purpose, predominance for the state law over the Central law is sought deviating from the law in force made by Parliament for the entire country, including that part of the state.” Thus, deliberation and application of mind are the prerequisites for giving assent to a repugnant state law to hold the field. In terms of Article 213 of the Constitution, the Governor of a state cannot promulgate an ordinance without instructions from the President on a law that requires his assent.

Recently, these provisions also attracted much attention in the context of the Land Acquisition Act, 2013, and amendments by states to them to dilute key provisions such as social impact assessment. Acquisition of property is also a subject in the concurrent list. Thus, the assent of the President was required before these state amendments could be passed into law.  The attempt by state governments to promulgate these ordinances without the assent of the President is thus patently illegal, unconstitutional and a clear disregard for the federal structure, which is a part of the basic structure of the Constitution.

Justice V Gopala Gowda 
Former judge, Supreme Court of India

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