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Rostrum’s Law Review | ISSN: 2321-3787

THE IMPACT OF COVID-19 PANDEMIC ON VARIOUS UNORGANISED SECTORS AND THE POLICY RESPONSE IN INDIA

ABSTRACT                                                                                                                                           :

“The greatest global humanitarian challenge the world has faced since World War II is the COVID-19 pandemic”. In India, the pandemic unfolded on January 20, 2020. To curb the transmission of the virus, lockdown was implemented from March 24, 2020 to March 31, 2022. The Indian economy has a preponderance of unorganised sectors, which employ over 90% of the total Indian workforce. The stringent nationwide lockdown had immense impact on the income, employment, and life of workers in the unorganised sector. The object of this research paper is twofold. Firstly, this paper aims to briefly analyze the effect of lockdown on source of income, means of support, social security, health, and indebtedness of various unorganised sectors in India. Secondly, this study mainly discusses in detail on the policies and Acts introduced during the pandemic crisis in favor of scavengers, street vendors, agricultural laborers, construction workers, domestic workers, and so on. This article identifies the presence of inbuilt vulnerabilities in the unorganised sector, and the scenario has been worsened by COVID-19 and lockdown multi-dimensionally. As a survival strategy workers in unorganised sector undergone reverse migration in the absence of source of income. The study shows that the lack of reliable data for specifically targeted unorganised workers is the cause for the paucity of legislation and welfare policies. Based on my findings, I argue that to secure broad-based improvements in the living standards of the unorganised sector, it is essential to address working conditions and prospects for unorganised workers.

Keywords: Informal economy, Unorganised workers, COVID-19, Poverty alleviation, labour policies

INTRODUCTION

The COVID -19 virus is the dreadful disease of this decade. The pandemic is not mere a health crisis it largely devasted every aspects of life. The pandemic ruined nearly every country in the world in every possible manner. As a result of dense population, Indian government implemented stringent quarantine since March 24, 2020 as a curbing strategy throughout the country. The health and social disruption caused by the impact of the lockdown shattered Indian labour market. Indian GDP shrank by 7.3%[1] and the share of informal economy has fallen drastically from 52.4% to 15-20% of GDP in the financial year of 2020-2021. The pandemic highly affected the unorganised sector multi-dimensionally. The Periodic Labour Force Survey (PLFS) data for 2020–2021 shows that the 89% i.e. 434 million workers falls under the category of unorganised sector among which more than 80% falls under non-agricultural employment.

The term unorganised and informal sector is used inter changeably in India. Unorganised workers are casual workers without any organisation or standardized rules whereas certain work areas without adequate guidelines and yet to be accepted by people are considered as informal. For example, domestic tuition and manufacturing works done by housewives are under informal sector. Since, the Indian official statistical documents like National Accounts Statistics (NAS) followed the terms organized and unorganised, the same is followed here.

Employments covered under unorganised sector based on various reliable documents are listed. Those are workers engaged in cigar making, beedi making, incense stick making, tailoring work, street vendors, platform workers, scavengers, gig workers, cobblers, rag pickers, domestic workers, washermen, auto and cab drivers, certain agricultural workers, construction workers, piece-workers and jobbers, artisans and crafts producers, plantation workers, workers in- mines, plantation, home-based workers and similar other occupations.

OBJECTIVES AND METHODS

The study is based on doctrinal method with primary and secondary sources like government reports, reports of special Boards and authorities, newspaper articles, published journals, surveys, research articles etc. Firstly, this paper aims to briefly analyze the effect of lockdown on source of income, means of support, social security and health of various unorganised sectors in India. Secondly, findings of this paper discussed about the immediate actions taken by the government before and during the pandemic crisis with respect to various unorganised sectors. This article analysed the extend of basic needs and monetary incentive reached by the policies of Government and special Boards in favour of various unorganised sectors.

GOVERNMENT INITIATIVES FOR UNORGANISED WORKERS IN THE PANDEMIC

To uplift the condition of the unorganised workers, Indian government took various legislative measures to ensure social security to the vulnerable workers. In 2008, Unorganised Workers Social Security Act, was enacted to ensure social security to unorganised workers. Subsequently, in 2009, the “National Social Security Board for Unorganised Workers” was established. The Unorganised Workers Social Security Act, 2008 failed to specify at what extend the “Workers Facilitation Centers” are to be established. Due to lack of implementation such legislative measures and policies not lifted the unorganised workers from their vulnerable condition. The Code on Social Security, 2020, a consolidated law enacted in the period of pandemic with the objective to ensure the benefit of minimum wages and social security to unorganized workers. It solves the knowledge gap and implementation issues available in other Acts. Provisions of this Act ensures maternity benefits, health benefits, standard condition of work, old age pension with redressal mechanisms[2].

In the pandemic time, Union and State government provided different basic needs and monetary assistance in the form of micro-credit loans, free or subsidised food grains, and others. Labour Commissioner of India prohibited employers to dismiss workers from their job and they are deemed to be on duty without any deduction in wages. The officers provided basic necessities like food, medical aid and shelter to the workers.

BUDGET ORGANISED FOR UNORGANISED WORKERS

                                       IN THE COVID-19  PERIOD (Rupees in crores)

Schemes/ Assistance 2019-2020 2020-2021 2021-2022
Budget Actuals Budget Revised Actuals Budget Revised Actuals
Pradhan Mantri Shram Yogi Maan-DhanYojana (PMSYM) 500.00 352.20 500.00 330.00 319.71 400.00 350.00 324.23
(Pradhan Mantri Karam Yogi Maandhan Yojana) 750.00 155.87 180.00 15.00 5.94 150.00 1.00 0.24
Pradhan Mantri Suraksha Bima Yojana (PMSBY) 17.01 190.00 200.00

 

1.00 0.00 0.10 0.10 0.00
Creation of National Platform for Unorganised Workers 1.00 0.15 50.00 50.00 45.50 150.00 280.00 255.24
Aatmanirbhar Bharat Rojgar Yojana (ABRY) Approved on December 2020 1000.00 405.00 3130.00 5000.00 3930.61

 

Life and disability cover: During COVID-19 around 2.66 Crore beneficiaries including workers in unorganised sectors were covered under the Pradhan Mantri Jeevan Jyoti Yojana (PMJJBY) and Pradhan Mantri Surksha Bima Yojana (PMSBY) which provides monetary benefits on death and disability in the period of 2019-20.[3]

Employment  generation and monetary benefits: Aatmanirbhar Bharat Rojgar Yojana (ABRY) Scheme, launched with the motive to create new employment and to restore loss of employment in the lockdown. Surprisingly more than 43 thousand beneficiaries benefitted through this scheme.[4] Additionally, MGNREGA programme[5] increased the workers revenue from INR182 to INR202 per day which helped 136 million workers in the lockdown survival period. Around 30 million people who are vulnerable individuals like, poor senior citizens, widows and people with disabilities benefitted through Rs.1,000 per month.

Awareness and skill development programme: During COVID-19 lockdown to provide special emphasis for enforcement of beneficial enactments, around 42,409 inspections were conducted and 3,693 convictions have been secured in the period of  2019- 2021. The Dattpoant Thengadi National Board for Workers Education and Development launched 421 programmes for unorganised workers from which around 13,733 participants were benefitted. As per the report around 71 online training programmes and webinars were conducted by the board during lockdown period. Labour welfare and COVID awareness programms were conducted with 31,493 workers of rural and unorganised sectors. In total 799 and 6829 awareness generation programmes were organised in the period 2020-2021 and 2021-2022 respectively.

National Database of Unorganised Workers: To get a reliable survey and to implement the welfare measures to unorganised workers e-SHRAM portal was launched during pandemic to build a National level registration portal for unorganised workers. The Universal Account Number in this portal helps the implementing authority to deliver other cash grants, temporary employment and food distribution for identified vulnerable groups.

INITIATIVES BY APPROPRIATE STATE GOVERNMENT DURING COVID-19

Most of the States announced relief packages for workers in the unorganised sector and issued ordinances against reduction of salaries during the lockdown period. In Karnataka, free food served through the Indira Canteens (March 28, 2020). West Bengal government provided Rs.1000/ incentive to daily wage workers through “Prochesta” scheme to manage pandemic crisis. Tamil Nadu Government gave 15 kg Rice, 1 kg Dhaal with edible oil  to reverse migrants and unorganised workers. Several boards and authorities under the state government facilitated the unorganized workers with food, shelter, medical aid, subsidised grains, transportation facility.

INITIATIVES FOR WOMEN UNORGANISED WORKERS

During quarantine, women shoulder the additional household tasks. The trend shows that women has less access to sexual and reproductive health. (UN WOMEN, 2020). The domestic violence also increased during the crisis. These factors marginalized women in rural labour markets. By understanding the condition of women during pandemic the Ministry of Women and Child Development under various schemes and institutions provided masks, sanitary equipments, sanitizers, soaps and other disinfectants. Specific institutions distributed sanitary napkins in collaboration with States and Union Territories. The Women Jan Dhan account holders were given Rs.500 per month for three months.

JUDICIAL DIRECTIONS

When legislative and executive bodies were striving to provide all essential needs to the workers and citizens, Judiciary contributed in this work in it’s own way. Supreme Court of India directs State and Union Government to implement welfare measures in the case of In Re Problems And Miseries Of … v. Union Of India & Ors.[6] The directions are as follows:

  1. The Union Government is directed to re-determine the figures of population increase during the decade 2011-2021, and stated that benefits under National Food Security Act, 2013, should not be restricted as per the census 2011.[7]
  2. The States are directed to enforce “One Nation One Ration Card” scheme and to run community kitchens at necessary places.
  3. The States are directed to impose scheme for distribution of food relief packages to migrant workers.

STREET VENDORS

The condition of street vendors aggravated in the pandemic time. Street vendors lacked adequate food and money for survival. During lockdown 64.7% of the street vendors survived through self-financing and 17.6% have switched their business for mere survival. Majority of them not forms a part of any street vendor union and not get any help from the self- help groups. One of the hardest part is that the street vendors paid bribes to run their business during lockdown.[8] The table below shows the condition of street vendors in the period of pandemic.

Condition of street vendors during COVID-19 pandemic Positive answers in percentage Negative answers in percentage
Received Special guidance from BBMP 11.8 88.2
Member of self- help group 0.0 100
Member of street vendor union 0.0 100
Switched the business during lockdown 17.6 82.4
Weekly income – below Rs. 3000 84 Rest (Rs.3000-9000)
Vending as their family businesses 94
Working for 8hrs- 13 hrs 62.7

Government Assistance to street vendors

The Pradhan Manthri Street Vendor’s Atmanirbhar Nidhi (PMSVA Nidhi), 2020 launched in the pandemic time to provided credit of Rs.10.000/- for street vendors with interest subsidy at 7% for a period of one year. The scheme covered five million vendors in urban and rural areas. Subsequently, Pradhan Mantri Karam Yogi Maandhan Yojana benefits 41,473 beneficiaries with Rs.2.44 crores in the form of pension in the year 2019-2020. These financial supports helped street vendors to manage their survival in the pandemic with holistic development. It also ensures street vendors to re-enter the labour market. Due to lack of digital and financial literacy, only 11.8% of street vendors were aware of PM-SVANidhi scheme. The findings shows that the credit system is not a direct relief but a prolonged trouble. After the pandemic, in the absence of any help from the government around 80% of the street vendors not able to repay the debt and loans.

CONSTRUCTION SECTOR

The construction sector with 40% of the casual labour force have been directly and immediately affected by the pandemic. Construction works largely ceased in the lockdown period which forced construction workers to undergo inter-state migration. The workers in this sector completely depended on the government since most of the workers work in contractual basis. Where contractors failed to provide necessary helps to the needy workers.

Government initiatives to curb the economic disruptions

The Union Government instructed State governments to provide assistance and support to construction workers. For which around Rs.31,000 crores were released to benefit 3.5 crores registered workers. To protect building and other construction workers against the economic disruptions, an aid of Rs.1,000 provided to 6.32 lakh construction workers. The State Welfare Boards distributed monetary incentives to around 1.83 Crores workers. The Arunachal Pradesh government in March 31,2020 has provided cash relief of Rs.2000/- for the registered construction workers. The government of Uttar Pradesh provided food relief packages to about 1.65 crores construction workers and daily wage workers. Haryana government distributed a sum of Rs.4,500 per month. These initiatives remarkably uplifted the economic condition of most of the construction workers. In the absence of efficient enforcement only registered construction workers were able to avail these benefits.

SECTOR WITH SCAVENGERS AND SANITARY WORKERS

Sanitary workers played a very important role to control COVID-19 spread. They collect, load, unload garbages, and worked at dump yards. While working, they come across cleaning various food wastes, human and animal wastes, sewage fume, dangerous gases, blood clot, used sanitary napkins, and several other waste products. As per the nature of the COVID virus it easily infects the sanitary workers. Since they live as a community with common toilet and water pipe they were at high risk of COVID-19 infection and can easily disseminate it.

The study shows that around 40.7% of the sanitary worker are contractual workers. The contractors benefits with minimum workforce and exploits the workers. In the absence of providing soap, sanitizer, adequate no of masks and guidelines by the authority, the lack of awareness among the sanitary worker and scavengers, leads to COVID-19 infection and transmission. It is reported that the authority failed to provide safety equipments like gloves and shoes but took sign and thump print of workers to decept higher officials. Around 39.3% of workers were affected by chronic illness and 61.3% with other health problems[9]. Mere scanners and screening of COVID virus are the facilities given by the authorities to protect these workers in the pandemic period. It is the same scenario still prevalent in the country. In the need of the hour it is essential to appoint a district level officer to look up on whether the contractors and authorities adhere to the rules for sanitary workers.

PLANTATION SECTOR

The plantation is the major source of income for people in Shimla, Darjeeling, Assam and the Nilgiri mountains. Owing to complete closure of plantation industry workers lost their jobs with arrears in pay. The plantation managements provided deductable emergency assistance to workers. In the absence of banks, ATMs, and public transport in their area, workers not able to withdraw their money from their bank accounts. Many workers changed their working area and some opt for another jobs. In the periods of financial difficulty workers borrowed money by mortgaging the gold through illegal money lenders since banks are closed at the time.[10]

Initiatives by the Union and State Government

The State government ran community kitchen and distributed food relief packages to avoid death due to starvation. The government distributed a kit containing fifteen essential commodities with 15 kilograms of rice and 30 kilograms of rice. Zero% interest loans with Rs.2000/- launched in the name of Kudumbasree–Ayalkkoottam scheme. The amount spent to ensure social security to the unorganized workers in Plantation sector is listed in the table below:

BUDGET RELEASED TO ENSURE SOCIAL SECURITY IN PLANTATION
Name of the scheme 2019-2020 2020-2021 2021-2022
Budget Actuals Budget RE Actuals Budget RE Actuals
Social security for plantation workers 19.90

 

19.04

 

40.00 40.00 27.38 60.00 50.00 50.00

Despite the schemes and implementation most of the plantation workers relied on the management due to lack of awareness and scheme promotions. Report shows in the majority instance plantation managements provided adequate relief to the workers. This particular sector not affected largely due to lockdown since partial lockdown allowed workers to resume their job and the salary facility with ‘on duty’ was properly maintained by the employers.

AGRICULTURAL SECTOR

In India, around 90% of agricultural workers are informal. They get employment only on the seasonal and temporary basis. The employment share of the agricultural sector is 44.2% in the year 2020–2021. In spite of exemption to agricultural sector from business closure this sector faced the problem to hire workers. Due to strict quarantines and closure various market brokers and intermediaries largely lost their jobs. As a coping strategy, some workers returned to their villages, sold their assets, got predatory loans from informal money lenders, and some undergone child labour. Farmers were paid Rs.2,000 under Kisan Yojana scheme which provides a minimum income to 87 million farmers. The Gareeb Kalyan Rojgar Yojana, 2020 is launched with the aim to tackle the impact of lockdown and COVID-19 on returnee migrant workers. This fixed scheme provided immediate employment and livelihood opportunities for 125 days to 6.70 lakhs agricultural migrant workers. The massive reverse migration and exemption of the agricultural sector from lockdown witnesses sector’s employment growth at the rate of 7.0% between 2017–2018 and 2020–2021. The agricultural business continued with guidelines. Hence, farmers were not largely affected by the quarantine.

DOMESTIC WORKERS

In India, about 7.79 million domestic workers falls under the category of unorganised sector on which more than 85% of them are women. Majority of women hardly have any land on their own and 17% of them are single women. At many instance these women are the bread winners of their families. The study shows that the monthly income of domestic workers is less than Rs.3000, which indicates that they not get any survival wage in the pre-lockdown period[11]. In the fear of virus infection majority of the domestic workers stopped working. The apartment boards and authorities prohibited most of the women to enter the area in the fear of infection. As per the table around 80% of domestic workers lost their jobs with wage deprivation. In the absence of source of income domestic workers and their families highly depend on money lenders or on governmental schemes for their daily survival.

CONDITION OF DOMESTIC WORKERS IN THE COVID PERIOD
Condition of workers Workers in percentage
No of women workers 85
Single women 17
Loss of employment 80
Partial loss of employment 10
Recovery of work in mid-May 46
Loss of income 51
Partial loss of income 18.5
Absence of adequate livelihood 87
Increased domestic violence 23

The Domestic Workers’ Welfare Boards failed to implement the policies and schemes enacted by the government. Basic necessities and cash benefits are provided through food relief packages and Women Jan Dhan scheme respectively. The table below shows the beneficiaries under various governmental schemes. Despite the initiative many workers were not able to avail these benefits. Since food relief packages and free rations benefits 76% of workers, it’s insufficient to meet their needs and the subsidies were irregular. Findings shows that most of the domestic workers took 4-5 works at different areas with lower wages in which some workers barely get wages instead they were provided with food and commodities by the family to whom they worked due to failed implementation on the side of implementing authority.

Government Initiatives Beneficiaries in percentage
Loans and micro credit 28
Access to medical aid 53
Assistance at hospitals 7
Access to free/ subsidised ration 76
Rs. 500 under Jan Dhan Yojan 24
Widow pension scheme 5
State government scheme 5
Non-government agencies 11
Others 2
Absence of benefits from Government 53

OTHER SECTORS: The government provided health care facilities to 50 lakhs of registered beedi, cine and non-coal mine workers in the year 2020- 2021[12]. Uttar Pradesh government provided Rs.1,000 through DBT for the 15 lakh unorganised workforce who are identified as hawkers, vendor, and rickshaw and cart pullers.[13]

FINDINGS AND SUGGESTIONS

Findings of the article shows that the unorganised sector workers received the basic essentials to survive which is not like the securities and benefits received by organised workers. Significant proportion of unorganised workers undergone reverse migration and some changed their profession to cope up with greater livelihood challenges and financial hardships during COVID-19 pandemic period. In addition to the health crisis they faced financial disability. Since, the miniscule coverage of policies and schemes provided resources for mobilization that not improved the living conditions of workers in the targeted sector. The government initiatives failed to provide adequate relief in the livelihood of unorganised sector workers’ for the following reasons:

  • Lack of reliable and latest data to understand the employment conditions of workers in unorganised sector is the major implementation barrier.
  • Absence of adequate bargaining power and lack of awareness regarding Trade Unions or other institutional machinery deserted their capacity to access capital and public services.
  • Absence of trust and confidence on government policies is still prevalent among the marginalized unorganised workers.
  • Inability to access digital platform reduces the eligible beneficiaries to avail credit facilities.

This study finds that the commercial banks failed to properly implement credit facility schemes. As a suggestion, it’s essential to setup a development bank with stringent regulations to deal with monetary schemes for specific sectors. Eg NABARD for Agricultural sector. It’s also essential to develop simple and pragmatic procedures to the workers in unorganised sector as many are illiterate. Some suggestions are like; clear and short, documentation procedure to release the money quickly.

CONCLUSION

The unorganised workers’ struggled to survive in the pandemic crisis with loss of employment, livelihood and salary. The remedies provided by the government remarkably uplifted the condition of fragile sector. The findings shows that in the presence of irregular performance and knowledge gap between the workers in unorganised sector and the implementing authority the policies and schemes will fail to benefit the needy workers. By bridging the knowledge gap and promoting the Government schemes will benefit the illiterate workers. By educating and creating awareness about their rights and duties prohibits the exploitation of unorganised workers by anyone. Monitoring wage trends, proper maintenance of reliable data is the main essential to understand the extend of beneficiaries benefitted from the Government policies. With effective promotion of trade union and other institutions locally ensures collective bargaining power for the unorganised workers. When developed countries are struggling to manage pandemic, Indian government imposed stringent plans and strategies for unorganised workers. Such policies and initiatives remarkably reduced the death rate which would have caused by both deadly virus and starvation in the unorganised sectors. In conclusion, the effective implementation of these Acts and promotion of policies will organise the unorganised, thereby ensures the better livelihood to the unorganised workers.

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[1] Ministry of statistics and programme implementation, Government of India, Annual report 2021-2022, available at https://mospi.gov.in/sites/default/files/annual_report/Approved_NSC_Annual_Report_2021_22.pdf, last seen on 08/08/2023.

[2] S.109, The Code on Social Security, 2020.

[3] Ministry of Labour and Employment, Government of India, Annual report 2020-202, pg  84, available at https://labour.gov.in/sites/default/files/annual_report_202021_english.pdf, last seen on 08/08/2023.

[4] Ministry of Labour and Employment, Government of India, Annual report 2020-2021, pg 245, available at https://labour.gov.in/sites/default/files/annual_report-21-22.pdf, last seen on 08/08/2023.

[5] Mahatma Gandhi National Rural Employment Gurantee Act (MGNREGA)

[6] In Re Problems And Miseries Of … vs Union Of India & Ors, W.P. (C) No.916 of 2020 (Supreme Court of India 29/06/2021).

[7] In Re Problems And Miseries Of … vs Unknown, Suo motu W.P. (C) No. 6 OF 2020 (Supreme Court of India 21/07/2022).

[8] Dr.Shilpa Sharma, Shweta Sharma & Sumiya Begum, Analysis Of Impact Of The COVID-19 Pandemic On Street Vendors – A Case Study Of North Bengaluru, 9 International Journal Of Commerce And Management Research

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[9] Krishan Kumar & Deepalatha R. Shetty, Safai Karamchari (Sanitary Workers)/Scavenger Community and Risk of Coronavirus (COVID-19) Pandemic in India, 15 Contemporary Voice of Dalit, 1–10, (2021) available at https://journals.sagepub.com/description/VOD, last seen on 13/05/2023.

[10] Najeeb V R, The Impact of the COVID-19 Lockdown on the Tea Plantation of Thettamala village, Wayanad, Kerala, available at https://www.google.com/url?sa=t&source=web&rct=j&opi=89978449&url=https://www.macroscan.org/spfea/apr20/pdf/Najeeb.pdf&ved=2ahUKEwj83KLXi82AAxVLGIgKHYtTDxAQFnoECBEQAQ&usg=AOvVaw32YFDD9riYh51J_Lnnl2BA, last seen on 23/03/2023.

[11] Impact Of COVID 19 Lockdown On Domestic Workers In India, 24 March to 4 May 2020, All India Democratic Women’s Association Domestic Workers survey, (2020) available at https://www.google.com/url?sa=t&source=web&rct=j&opi=89978449&url=https://www.labourbureau.gov.in/all-india-survey-on-domestic-workers&ved=2ahUKEwiqhdi9jc2AAxWXet4KHdhkCmsQFnoECA0QBQ&usg=AOvVaw1mmGuNBTZ79AtrW44pDRP8, last seen on 20/03/2023.

[12] Ministry of Labour and Employment, Government of India, Annual report 2020-2021,pg 84, available at https://labour.gov.in/sites/default/files/annual_report_202021_english.pdf, last seen on 08/08/2023.

[13] Suo Motu vs State Of Gujarat , WPPIL (C) No.42 of 2020 (Gujarat High Court 03/04/2020).

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