THE GIST of Editorial for UPSC Exams : 22 November 2018 (New labour for new India)

New labour for new India

Mains Paper 2: Polity
Prelims level: Universal account number
Mains level: Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes


  •  Any discussion on the unemployment challenge in India should be grounded in the following facts:

  •  The Indian economy needs to generate employment for about 5-7 million people that enter the labour force annually;

  •  Over 90 per cent of the workforce has informal employment they have neither job security nor social security; and

  •  There has been a growing infomalisation in the organised sector.

  •  The trade unions have focused their attention on only protecting the rights of workers in the organised sector.

Addressing the problems

  •  The government has tried to address the problems.

  •  The first is to promote formalisation and the second is the provision of social security to those remaining in the informal sector.

  •  The most important reform is the introduction of “fixed term contract” employment.

  •  Fixed contract workers must be employed under the same working conditions (such as wages, working hours, allowances and other benefits) as permanent workers.

  •  Fixed-term workers are also eligible for all statutory benefits.

  •  Allowing fixed-term employment would help employers to respond to the fluctuating demand and seasonality in their businesses and facilitate the direct employment of workers.

  •  Formal employment is also sought to be promoted by reducing the compliance cost for companies.

Initiatives taken by the government

  •  The government has also taken numerous technology-enabled transformative initiatives such as the Shram Suvidha Portal, universal account number (UAN) and national career service portal in order to reduce the complexity burden and ensure better accountability.

  •  The central government has also managed to persuade state governments and Union Territories (UT) to allow self-certification and regulate inspection.

  •  One of the major achievements of the government is the increased Employees’ Provident Fund (EPF) coverage.

EEC Campaign

  •  The Employees’ Enrolment Campaign (EEC) was launched by the government in January 2017 to enrol employees left out of the EPF and provided incentives to employers.

  •  The government also launched the Pradhan Mantri Rojgar Protsahan Yojana in 2016 (revised this year) under which the government will pay the full employers’ EPF contribution for three years for new employment.

  •  The construction sector employs the highest number of casual workers outside of agriculture.

  •  The most important reform for this sector is the introduction of Universal Access Number (UAN).

  •  The central government also amended the Building and Other Construction Worker Rules, 1998, on December 29, 2017, so as to make the process of filing of the Unified Annual Return transparent for registered establishments.

  •  The amendment of the Payment of Wages Act in 2017 introduced a provision that the government may, by notification in the official gazette, specify that an industrial or other establishment shall pay wages only through its bank account.

  •  The railways, air transport services, mines and oil field sectors covered under central sphere has been issued on April 25, 2017.

  •  The government is also in the process of finalising Labour Code on Social Security.


  •  Historically, due to well-intentioned but poorly-designed labour laws, only a small section of India’s labour force has had job security and social security.

  •  Change is being reflected in monthly data released by EPFO, which shows that there is a shift from the unorganised to organised sector.

Online Coaching for UPSC PRE Exam

General Studies Pre. Cum Mains Study Materials

Prelims Questions:

Q.1) Five schemes have been launched under Pandit Deendayal Upadhyay Shramev Jayate Karyakaram. Which of the following come under those?

1) Revamped Rashtriya Swasthya Bima Yojana.
2) Apprentice Protsahan Yojana
3) Universal Account Number Scheme
4) Random Inspection Scheme

A. Only 1 and 2
B. 2, 3 and 4
C. 1, 3 and 4
D. All of the above
Answer: D

Mains Questions:
Q.1) Critically evaluate the performance of unemployment alleviation programmes in India.