Labour Strike | Voices rise against rights erased

The July 9 strike was a clear expression of growing unease. The new labour codes are not a progressive change, but are legal instruments to legitimise informalisation and suppress collective bargaining.

India’s labour movement sent a resounding message on July 9, as workers across transport, construction, banking, and manufacturing sectors joined a nationwide strike. The immediate cause was the Centre’s renewed push to operationalise the four labour codes, but the unrest has long been simmering. Workers fear that these laws, presented as reforms, are gutting decades of labour protections in the garb of ease of business.

Enacted in 2020 with minimal consultation, the four codes — the Code on Wages, Industrial Relations Code, Social Security Code, and the Occupational Safety, Health and Working Conditions (OSHWC) Code — replace 29 labour laws. Marketed as a simplification exercise, the changes mark a significant shift in how labour is governed in India. For workers and unions, these are not reforms, they represent a rollback of rights.

At the heart of the controversy is the redefinition of a ‘worker’. The industrial relations code excludes employees in supervisory roles earning above ₹18,000 per month. This cuts off large segments of the workforce from protections such as unionisation and protection from arbitrary dismissal.

More concerning is the legitimisation of fixed-term contracts across all sectors. What was once limited to specific seasonal or project-based tasks can now be used for permanent roles. Employers can renew contracts indefinitely without obligation, making long-term job security a thing of the past. This precariousness discourages union activity, and weakens workplace resistance.

Retrenchment protections have also been diluted. Employers now need government approval to lay off workers only if they employ more than 300 people, up from 100. Given that India’s economy is dominated by small and medium enterprises, most workers will no longer have any institutional shield against sudden dismissal.

The codes further restrict the formation and functioning of trade unions. Registration requires support from 10% of the workforce or at least 100 workers — whichever is less. While this may seem reasonable, in informal or fragmented workplaces, such thresholds are nearly impossible to meet. Recognition rules have also changed, privileging majority unions without mandating secret ballots. The process of determining membership strength lies with the government, leaving room for interference.

The right to strike has been severely curtailed. Strikes now require prior notice and are banned during conciliation or tribunal proceedings — periods that can be extended indefinitely. Workers participating in or even supporting an ‘illegal’ strike can face fines and jail time. Meanwhile, employers face no comparable penalties for lockouts or policy changes imposed without consent.

The social security code was touted as a leap forward for gig and informal workers. In practice, it remains a paper promise. The code expands definitions but lacks enforceable schemes or funding models. Simultaneously, it narrows the definition of ‘wages’ and reduces provident fund contributions, weakening formal sector benefits too.

The OSHWC code shrinks coverage by redefining what constitutes a ‘factory’. Premises with fewer than 20 workers using electricity (or 40 without) are no longer covered. Contractors employing fewer than 50 workers don’t need licenses, effectively deregulating a major part of the workforce.

Many critical sector-specific safety laws have been repealed, and no clear replacements have been notified. Even fundamental protections like the eight-hour workday are weakened, as state governments can extend daily work hours up to 12 by simple notifications.

The codes give employers greater power and flexibility while reducing workers’ ability to organise or negotiate. Even the façade of labour oversight is being eroded; inspectors have been renamed ‘facilitators’, and inspections now require government approval.

The government argues that these reforms will bring India’s labour laws in line with global standards. But international conventions, including several core ILO standards (like Convention 87 and 98 on freedom of association and collective bargaining), emphasise social dialogue, union rights and job security — elements steadily stripped away in India.

The July 9 strike was a clear expression of growing unease. These codes are not a progressive change, but are legal instruments to legitimise informalisation and suppress collective bargaining. The argument for simplification does not justify the erosion of rights. Reforms built without dialogue are unlikely to succeed, and ones that marginalise the very people they claim to benefit are bound to invite resistance.

India’s labour laws were not perfect. But the new codes don’t fix the flaws; they replace them with gaps. Where the law becomes a tool to weaken rather than protect the vulnerable, protest is not just justified, it becomes necessary.

(Yadul Krishna is a policy economist and fellow at Governance Innovation Labs. X: @yadul_krishna.)

Disclaimer: The views expressed above are the author's own. They do not necessarily reflect the views of DH.