No labour reform

Updated May 01, 2017


THE world of labour has gone through great turbulence. Globalisation, restructuring, deregulation of economies and technological changes have reshaped labour relations. Precarious, informal emp­loyment and diverse contractual forms of work have replaced traditional permanent employment.

The supply chain production system has left the workforce dispersed in various unconnected spaces, shrinking the power of labour unions. Legal frameworks based on old employment relations models no longer protect workers. This has led to a global debate on labour law reforms to address adverse impacts of change.

Many countries have enacted laws seeking to protect workers from vulnerability. Examples include the Dutch Flexibility and Security Act 1999, the Austrian Severance Act 2002, Indonesian National Social Security System Act 2004, Indian National Rural Employment Guarantee Act 2005 and Unorganised Workers Social Security Act 2008, Myanmar Social Security Law 2012, Brazilian domestic workers’ legislation 2014 and the Turkish law governing temporary employment contracts 2016.

Outdated, repressive labour laws remain in force.

Pakistan’s story is different. Labour entered the new millennium with the Industrial Relations Ordinance (IRO) 2002 imposed by the military regime, which was more restrictive than IRO 1969. The Finance Act 2006 imposed further curbs on workers’ rights, and when the Industrial Relations Act 2008 was enacted by the democratic government it too did not conform to the spirit of the Constitution. The passage of the 18th Amendment in 2010, which devolved labour to the provinces, brought a ray of hope to workers who expected greater provincial autonomy to deliver improved labour legislation, better enforcement and thus decent work conditions.

The hope for modernising and reforming the labour code (based on the colonial era legal framework) soon faded as constraints surfaced, including lack of political will, low priority to labour, poor capacity of provincial labour departments and the absence of a tripartite mechanism. The reviewing, modernising and provincialising of the pre-devolution labour code required strong national commitment, prioritising, provincial coordination, federal guidance and oversight.

In the absence of these, the provinces have gone their own which way, sluggishly, to adopt the once federal — once colonial — laws. The process has so far yielded the adoption of 19 labour laws in Punjab, 12 in Khyber Pakh­tunkhwa, 11 in Balochistan and 10 in Sindh.

The provinces opted not to reform the key legislation, the industrial relations law, and instead based it on IRO 1969. None of the provinces did away with repressive and exclusionary clauses. Only the Sindh Industrial Relations Act 2010 granted the rights to organise and collective bargaining to agricultural workers, but the rules have yet to be formulated. Hence, the clause is as good as dead. Many of the provinces’ laws do not adhere to international standards.

The crucial issue of ensuring uniformity of laws in the provinces remains to be addressed. An overarching, broader national framework embodying fundamental principles as enshrined in the Constitution and the ILO standards is needed. Seven years have passed since the 18th Amendment and the federal government has neither come up with such a framework nor placed a statutory mechanism to ensure that provincial laws adhere to this blueprint.

Far from responding to the emerging needs of social protection to workers, reforming labour laws and formulating inclusive legislation, the country has failed to strengthen even the couple of laws dealing with social security of a minuscule section of the workforce, ie Employees Old-age Benefits Institution Act 1976 and the Workers Welfare Funds Ordinance 1971. The status of the two state-run labour welfare institutions based on these laws remains contested vis-à-vis the 18th Amendment. Amidst the ongoing conflict over ownership between the provinces and the federation, the constitutional petitions filed in the Supreme Court (by Punjab for devolution, by KP and Balochistan against devolution) and the adoption of the two laws by Sindh, the institutional decline of the EOBI and WWF continues to the detriment of workers in the four provinces. The EOBI, WWF and Provincial Social Security Ordinance 1971 need to be made inclusive of temporary workers and other categories of vulnerable workers.

The federal Law and Justice Division should partner with the provinces on reform and scrutiny of labour laws under a well-defined system. Provincial governments should put in place tripartite consultation mechanisms and ensure transparency. Draft bills should be shared with all stakeholders and enough time given for adequate review and feedback.

Labour laws must have three attributes: a grounding in fundamental principles (constitutionally mandated rights and international standards); coherent building of the labour code upon these principles; and fair and efficient implementation.

The writer is a researcher in the development sector.

Published in Dawn, May 1st, 2017