Covid-19 relief: How India doesn’t count the poor as workers

The labour ministry’s focus is on registered construction workers and provident fund subscribers, excluding a vast majority of the working poor.

WrittenBy:Anumeha Yadav
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On March 29, four days after Prime Minister Narendra Modi announced that all establishments and public transport would be shut down to prevent the spread of coronavirus, Rashmi Ahirwar and her husband, Rakesh, picked up their bags and left. They planned to walk 570 km to their village in Tikamgarh, Madhya Pradesh, to survive the lockdown.

But the Ahirwars were turned back by the Delhi police. They had to walk back to the construction site in Delhi University’s South Campus where they have worked and lived for the past year.

“We were carrying grains. We could have cooked on the way and managed,” said Rashmi, as she set her bags down.

The government has announced a Covid-19 relief package of Rs 1.7 lakh crore, a meagre 0.8 percent of the gross domestic product. However, labour economists calculate that the working poor like the Ahirwars, who constitute nearly 90 percent of all workers, have suffered an earnings loss of nearly double this, at Rs 3.5 lakh crore since the lockdown. Activists say the government has failed to provide low-wage workers with any income support.

Rakesh and Rashmi Ahirwar are among over 40 workers at two construction sites on the college campus. Like a vast majority of India’s workforce, a month after the lockdown was announced, no state relief has reached them.

On March 28, the couple had met Subodh, a representative of the labour contractor of the Central Public Works Department, the central government agency in charge of public sector works. He had paid them Rs 6,000 for the work done by both of them over 21 days, from February 29 to March 21, and an additional Rs 2,000 as “kharchi”, a weekly installment of cash for expenses that the contractor adjusted against their wages. He had given them Rs 6,000 as expenses, in installments of Rs 2,000, over the previous three weekends.

Their combined wages for over 21 days of work came to Rs 14,000, or Rs 333 a day. This is less than 60 percent of the daily minimum wage in Delhi for “unskilled work” – Rs 570 a day, as notified in October 2019.

For the Ahirwars and seven other families at the same site who too had tried to walk back home in a group – seven women, nine men, and nine infants — the payments from the contractor was a signal that they could leave.

“The contractor usually pays only the ‘kharchi’ weekly. The wage payment is done after some months, after the work is finished,” said Narayan Kumar, the contractor’s representative at the site. “There is no written contract, and if he has paid the wage, the workers interpret it to mean the contract is done.”

One of the workers, Roopram Ahirwar, who is in his 40s, said he was eager to return to his home in Tikamgarh, Madhya Pradesh. He was willing to walk all the way because only one of his children, six years old, lived with him on the construction site.

“Our children cannot go to school in Delhi as schools ask for residence proof. Two of my children who are 10 and eight are back home with my elderly mother. Who will take care of them in the lockdown?” said Roopram, who never went to school himself.

Apne aap ghabrahat hoti hai. Yahan mann bhaari hota hai,” said Roopram. “I feel heavy-hearted and anxious here.”

Another worker in his late teens, Phoolchand Kevat, was thrashed by the police at Rao Tula Ram Marg when he tried to leave the construction site and walk home. The police forced him to return to the site.

“But what will we live on here?” he said. “Employers care only about whether we work and are productive. They will not care for us during lockdown.”

At a second site on the university campus, near Aryabhatta College, live 20 Adivasi workers from Jharkhand’s Godda. They ran out of rations after three days and survived on rice with saltwater until a few college teachers arranged for the delivery of cooked meals. But the workers were anxious as the food van did not stop by every day.

Kishore Oraon, one of the workers, said the contractor had last paid him and his wife three months ago. They had received cash for 60 days of work. Since then, the contractor has given a “kharchi” of Rs 1,000 per week per person.

A second labour contractor at this adjoining site paid them Rs 250 a day, less than half of Delhi’s minimum wage for “unskilled work”.

‘Governments flout labour laws’

None of the over 40 workers at the two sites run by labour contractors of the Central Public Works Department received the mandatory provident fund or social security benefits at the rate of 12 percent of their wages, contributed by the worker and the employer and deposited with the Employees’ Provident Fund Organisation.

A construction worker tried to walk from Chhatarpur to Delhi cantonment, where he heard he could get transport in the first week of the lockdown.
Kishore Oraon, an Adivasi worker from Jharkhand, has lived in a CPWD construction site since October. He ran out of food during the first week of the lockdown.
Afroz's parents work on a construction site for a school in Nangloi. He lives on the site and hasn't gone to school in six months.

None of them were registered under the Building and Other Construction Workers Regulation of Employment and Conditions of Service Act of 1996, or the BOCW Welfare Cess Act of 1996, intended to provide social security to construction workers. Under these laws, states levy a cess of 1-2 percent on construction projects, applicable to any establishment employing 10 or more workers and to projects costing more than Rs 10 lakh, to create a welfare fund for registered workers. Workers between 18 and 60 years of age, and employed for at least 90 days in the preceding 12 months in building or construction work, are eligible for benefits, such as pension, house loans, education support, assistance in case of accident, and medical expenses.

None of the workers Newslaundry spoke to at the CPWD sites were registered with the BOCW welfare boards.

A notification issued by the lieutenant governor of Delhi in April 2018 authorises assistant engineers, civil and electrical, of the CPWD to register construction workers for social security benefits under the BOCW Act, 1996. This was meant to make it simpler for the workers to register for benefits.

Puneet Kumar Vats, the director general of the CPWD, told Newslaundry that the agency deducted and submitted a one percent cess on its construction projects, but he did not have any information on the registration of construction workers who work at its sites with BOCW welfare boards. “Labour officials would have to register them,” he said.

Besides the CPWD, the 2018 order says, assistant engineers from other public bodies can do this too, including the Public Works Department, the New Delhi Municipal Corporation, the Municipal Corporation of Delhi, the Delhi Jal Board, the Delhi Metro Rail Corporation, the Delhi Development Authority, the Delhi Cantonment Board, the Delhi Agriculture Marketing Board, the Delhi State Industrial and Infrastructure Development Board, building and construction work of public sector undertakings, and “building and other construction work” that does not fall under any of these categories. Executive engineers of these departments are authorised as “recommending authorities” if registered workers apply for welfare benefits.

Subhash Bhatnagar, the coordinator of the National Campaign Committee for Central Legislation on Construction Labour, said the assistant engineers of the CPWD could have acted as registering authorities.

“There is no reason why they could not register the workers themselves, and it is surprising they are not even aware of it,” he said. He added that government public works agencies, both at state and central level, flout the law, and do not provide minimum wages, or housing or toilets to workers at the site.

‘Fake news made workers leave’

On March 31, activists Harsh Mander and Anjali Bhardwaj filed a public interest litigation in the Supreme Court, seeking that the government pay minimum wages to all migrant workers stranded in the lockdown. On April 7, Gyanesh Kumar, the additional home secretary, responded that the petitioners were in “blissful ignorance” about all the actions the government had taken to protect the poor, and asked for the petition to be dismissed.

Responding to another PIL filed by lawyer Alakh Alok Srivastava on providing food and shelter to migrant workers, home secretary Ajay Kumar Bhalla said the government had taken care of the daily needs of every poor person, including migrant workers. Bhalla asked the court to issue directions to news organisations as “fake news” had created panic, leading to workers walking hundreds of miles home in defiance of the lockdown.

As part of the financial relief measures rolled out for workers, Bhalla claimed, 3.5 crore workers registered under the BOCW Act would get aid. Low-wage earners in the organised sector, earning below Rs 15,000 a month, would get 24 percent of their wages in their provident fund accounts.

Construction workers from Tikamgarh, Madhya Pradesh, have lived on this site for the past year.
Construction workers who tried to walk from Delhi to Jhansi. They were stopped by the Delhi police and sent back to the construction site.
The construction site at Delhi University's South Campus. It lacks basic amenities like toilets.

On March 29, after Modi announced the lockdown, the union home secretary, in a video conference ordered state officials to prevent the large-scale movement of low-income workers on foot. States such as Haryana passed orders that migrant workers could be arrested under the Disaster Management Act and kept at indoor stadiums serving as “temporary jails”.

On April 15, a day after the prime minister extended the lockdown by three more weeks until May 3, the home ministry issued guidelines that permitted workers who had tested negative for Covid-10 to be transported by state governments to work sites — but not to their homes. It allowed construction and industrial activity to resume with geographical restrictions from April 20.

Precarious work

As of 2018, around 369 million people – or 80 percent of India’s workforce of about 460 million – were self-employed in agriculture, or worked in small and medium enterprises with less than 10 workers which are not required to provide provident fund or social security benefits to workers. Of the remaining 92 million designated as working in the formal sector, 49 million were employed as temporary or informal workers, without written contracts or social security.

In 2017, the labour ministry set up an expert committee to devise methods for fixing a national minimum wage. The committee submitted its report in 2019. It said nearly 60 percent of all Indian workers, or 278 million, did not earn a daily wage (or income if self-employed) of Rs 375, which it recommended as the daily minimum sum workers need to meet their basic household needs at 2017-18 prices.

As per the periodic labour force survey by the National Statistical Office in 2017-18, two-thirds of all workers don’t have employment contracts. In the construction sector, which is as large an employer as the entire manufacturing sector, less than 10 percent of the workforce is employed formally.

Among the key measures announced by the labour ministry, it advised states to use Rs 52,000 crore available as cess funds with building workers boards to give cash to 35 million registered construction workers.

According to government data, this will benefit 35 million registered workers who comprise 60 percent of the 54 million construction workers in India.

But activists with the National Campaign Committee for Central Legislation on Construction Labour, a campaign founded by retired Justice VR Krishna Iyer that advocated for the 1996 BOCW laws, say their studies show that the actual number of construction workers is over 100 million. So, the benefits will apply to only a third of all construction workers in India.

R Geetha, a regional coordinator of the Nirman Mazdoor Panchayat Sangam, pointed out that a majority of workers could not register with welfare boards as their employers refused to give employment certificates showing 90 days of work in a year. “Most employers do not pay minimum wages and refuse to register workers. Even government bodies such as the PWD employ workers without registering them with welfare boards,” she said.

Geetha added that even when workers were registered, they found it cumbersome to renew their registration every year as their places of work and proof of work changed.

“In Tamil Nadu, for instance, the total number of workers is estimated at 51 lakh, of which 29 lakh were registered in 2017,” she said. “But the most recent data show only 13 lakh were able to renew registration, and only this one-third fraction will get Rs 2,000 in two instalments from the state government.”

At a press conference in New Delhi on April 8, the home ministry announced that nearly two crore registered construction workers had been given a total of Rs 3,000 crore.

Bhatnagar, the coordinator of the National Campaign Committee for Central Legislation on Construction Labour, said the government’s claims appeared “imaginary” because in most states the governments did not have the bank account details of the majority of the workers who had registered with welfare boards.

Nine children live on this construction site in South Campus. They have no access to schools or anganwadis.

“In Uttar Pradesh, government estimates put the total number of construction workers at over 1.21 crore. As of June 2017, 36 lakh or 30 percent were registered with the UP BOCW board, which is the highest number among all states,” he said. “As per a letter of the board’s principal secretary, labour, on April 5, the government has bank details of only 10.92 lakh of 36 lakh registered workers. The Uttar Pradesh government announced it would pay Rs 1,000 per registered construction worker but even if it transferred this amount to all of them, it comes to Rs. 109.2 crore.”

Bhatnagar pointed out that in states such as Delhi, where the government had announced a more substantive sum of Rs 5,000 to each worker registered with the board, the number of beneficiaries and amount came to very little.

“In 2017, around 5.4 lakh, or nearly half of all Delhi’s workers, were registered. But after the government made the process of registration digital, very few workers were able to renew and the number dropped from 5.4 lakh to 44,000 now,” he said. “The transfer in Delhi amounts to a total of Rs 22 crore. Where is the union government citing this Rs 3,000 crore figure from? It ought to explain.”

Chandan Kumar, convenor of the Angmehnati Kashtakari Sangharsh Samiti, an umbrella organisation representing construction labourers and other casual labourers in Maharashtra, has filed a petition in the Bombay High Court asking the state to pay construction workers three months’ minimum wages.

On April 18, the Maharashtra government announced that of the Rs 8,207 crore with the board, it would deposit Rs 2,000 each into the accounts of 12 lakh registered construction workers.

“This comes to spending just Rs 240 crore and leaves Rs 7,967 crore unspent with the board,” Kumar pointed out. “If the state deposits three months’ minimum wages for unskilled work – which comes to Rs 21,000 – into workers’ accounts, that would amount to disbursing Rs 3,000 crore and still leave Rs 5,207 crore unspent.”

Since a majority of workers are not registered, Kumar asked that the government allow workers’ organisations to help register them through simple means and include them in welfare benefits.

“If the government is allowing construction sites to reopen, it should allow no work without first registering these workers for social security,” he said. “It should allow workers’ organisations to join task forces to include more workers. When low-income workers lack smartphones and are not fully literate, the government cannot rely on apps and registering digitally in an emergency.”

Development economist KP Kannan, who was a member of the former National Commission for Enterprises in the Unorganised Sector, pointed out that the central government was highlighting the disbursal of BOCW funds which were managed by the state governments but had not provided any additional funds.

“If the central government wished, it could make additional payments to state-level boards and instruct them to pass on to the members who are in construction,” he said. “That would be a direct payment from the union government, but it has not added any additional funds.”

Ministry measures leave out vast majority

Between March 20 and April 20, the Ministry of Labour and Employment made 16 public statements related to Covid-19 relief. Ten of these were about relief pertaining only to subscribers of the Employees’ Provident Fund Organisation.

Less than 20 percent of the total workforce in India consists of regular wage workers, and EPF accounts cover only 12.5 percent of the total employees.

A key relief for EPFO subscribers came on April 11. The ministry announced it would pay both the employer and employee contribution to EPF accounts (24 percent of wages) from April to June for factories that employ less than 100 workers if 90 percent of the workers in the unit earn below Rs 15,000. It stated that it expected this measure to benefit 79 lakh EPF subscribers and 3.8 lakh establishments, and amounts to a subsidy of Rs 4,800 crore from the government.

On April 15, the ministry announced that it had extended the date for employers to file EPF electronic returns till May 15. It also announced an expedited process of online claims for those who wished to withdraw their provident funds. It stated that it had processed 3.31 lakh claims of Rs 946.4 crore.

The ministry’s measures partially help employers in payment of provident fund dues. But the 79 lakh, or nearly eight million EPF subscribers, that this measure aims to cover constitute less than two percent of India’s workforce of 467 million. It does not even touch over 90 percent of the working poor.

Kannan, the development economist, said these measures lacked realism and a sense of responsibility towards the working poor.

“The government of India seems to have completely abdicated its responsibility,” he said. “Provident fund subscribers are a very small fraction of the Indian workforce, and this measure has no meaning for the vast majority. PF benefits are retirement savings, and all the government is doing is allowing workers to consume their future savings, saying take it and eat it in an emergency.”

Heeralal Samariya, a secretary in the labour ministry, did not respond to an emailed questionnaire, phone calls, and text messages asking for comment on relief measures for workers in the unorganised sector.

Ajay Tewari, a joint secretary in the directorate general of labour welfare, told Newslaundry he had been deputed in the Northeast for Covid-19 relief since March 19, and could not comment.

An official in the directorate general of labour welfare who declined to be named said the ministry was implementing the measures that fell under its purview out of the prime minister’s relief programme.

“The prime minister has announced a huge package under the PM Garib Kalyan scheme. We are working on the measures that fall under the labour ministry,” he said. “Nearly 50 crore workers in India are in the unorganised sector and some may be stranded here and there. Various state governments are providing them food relief, and we collated data that Rs 3,100 crore for construction workers have been disbursed so far.”

He added that the ministry was working on a dashboard which would show the status of relief operations. This dashboard may become operational this week.

An official in the minister’s office said the labour ministry had released the phone numbers of 20 regional commissioners to serve as workers’ helplines since April 14.

“The commissioners are coordinating with the Employees’ Provident Fund Organisation and the Employees' State Insurance Corporation. We have received over 2,100 complaints on these helplines in the past week, including on non-payment of wages, but 1,400 complaints fall in state labour departments’ purview,” said the second official, who also declined to be named.

Families from Tikamgarh, Madhya Pradesh, living on a CPWD construction site in South Campus.
Workers, with their bags and children, were sent back to the construction site by the Delhi police.

Economist Ravi Srivastava, who is the director of the Centre for Employment Studies at Delhi’s Institute for Human Development, said the government had failed to measure migration accurately, and had failed to design labour policies factoring migrant and informal workers.

Srivastava said: “A majority of Indian workers are casual and contract workers and live at construction sites, factories, restaurants where they work, or precariously on rent in slums near cities. The census fails to account for them and they are not factored in policies.”

He added: “The labour ministry is now struggling to calculate the correct estimates of migrants in each state, and is playing around with EPFO schemes and struggling to find a space for itself to intervene. The home ministry is viewing workers as only a law and order problem.”

Intensifying distress

The union government submitted data in court that till April 7, at least 1,03,7027 people had been housed in relief camps. Of them, 405,908 people (39 percent) were provided shelter by NGOs. Additionally, 17,321 “food camps” were organised, of which 9,473 (54 percent) were by NGOs, and 8,42,6509 people had been provided food, of which 3,01,1051 (36 percent) were fed by NGOs.

Activist Anjali Bhardwaj of Satark Nagrik Sangthan had petitioned the Supreme Court saying that with 90 percent of Indian workers in the unorganised sector, the government was not enforcing the payment of wages and rent relief through the lockdown, and it ought to provide income support equivalent to minimum wages to migrant workers, whether in self-employment or in temporary contracts.

“Low wage workers’ distress is growing every day. If 200 food packets arrive at a food camp, 500 people are needing food and it leads to stampedes and distress,” said Bhardwaj. “Even if they get a meal that day, how long can they survive only on khichdi being served at camps? They have no money for essential medicines, milk or sanitary napkins.”

On April 21, the Supreme Court dismissed the PIL without any directions to the government, while maintaining that “everybody was trying to do their best.”

A report released by researchers working with the Stranded Workers’ Action Network, a group of 73 social activists and volunteers who attended to distress calls for cash and food from workers stranded in the lockdown, found intensifying distress among the working poor.

Between March 27 and April 13, the volunteers had interacted with 640 groups of workers: 11,159 workers in total, including 1,643 women and children. Of this, 79 percent were daily wage industrial or construction workers, eight percent were self-employed as craft-persons and hawkers, and eight percent were in services such as domestic work.

Seventy eight percent of the workers had less than Rs 300 cash left for the remaining period of the lockdown. Seventy percent had less than Rs 200 left, and 89 percent of the workers had not been paid by their employers or contractors since the lockdown began. Most of them had no social support networks in the cities they were working in, or knew only their labour contractor. A majority of workers could not recall or identify the name of the company or builder they worked for.

“Most of the workers are informal workers and worked through contractors. When we told them that their employer should pay them, many of the workers said they tried reaching out to the contractor but their phones were switched off,” said one of the authors, Sakina Dhorajiwala.

Photos by Anumeha Yadav

This piece is part of a project supported by the Thakur Family Foundation. The Thakur Family Foundation has not exercised any editorial control over the contents of this research.


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