Labour threat!

Beyond cement and steel, sweat and sinew are the lifeblood of any construction. RAHUL KAMAT shifts the focus onto our labourers - who provide these intangibles to every structure - and emerges with some hard-hitting facts about their often deplorable employment, living and safety conditions. Media reports on the death of over 500 Indian construction workers in Qatar over the past two years have provoked clamour and criticism. In fact, the toll is expected to go up to 1,500 by 2022, as this Gulf nation will see a spurt in building projects ahead of the 2022 FIFA World Cup. (For a detailed story on Qatar, visit www.ConstructionWorld.in) Although the reports highlight the plight of Indian workers in GCC countries, which has gone ignored, all is also not well in our own backyard either. In India, deaths and injuries owing to negligence of safety are on the rise. While there are no official records on deaths and injuries of construction workers, the finding of a survey by the International Labor Organization, suggesting that 170 out of 1,000 construction workers suffer injury while working, should give us a pause. Indeed, a visit to construction sites across the country serves to unearth further shocking facts about construction workers. No rights, only wrongs For almost eight years, Amit Kumar, a 32-year-old construction worker from Odisha working on a construction site on the outskirts of Mumbai, has spent his life like a refugee. Taking shelter under a plastic tarpaulin and struggling for basic amenities, he and his family, which comprises two children, have often moved to different states, enduring a horrid existence. Kumar is not alone - he is just one among a mammoth construction workforce that is building, connecting and uplifting the new India, while remaining unaware of its own rights. "They are uneducated; how can you expect them to know their rights unless states make some provision for awareness programmes?" says Mohit Kapoor, Advocate, who deals with labour issues. "It is wrong to blame the Centre for negligence as it is a state subject, and it is the duty of the state machinery to register construction workers under The Building and Other Construction Workers (BOCW) (Regulation of Employment and Conditions of Service) Act, 1996, and Building and Other Construction Workers Welfare Board (BOCWWB)." In a shocking revelation, Gujarat-based Prakash Baria, a 40-year-old painter told CW that though workers are literate enough to know about some rights, it is the labour contractors who suppress workers. "If we try to revolt against them, the chances are less to get future daily jobs," says this eight pass worker who earns Rs 500 per day. "We are liable for provident funds and other schemes but no contractor follows it. No one listens to us," he adds. "We are mistreated because we do not have any identity of our own," says an emotional Baria. "The migrant nature of these workers makes it difficult for them to get registered under the various acts," points out Anil Swarup, former Director-General, Labour Welfare, Government of India. "Also, while these workers are covered under all labour laws, it is the implementation of these laws that has left a lot to be desired." Although the Act was passed in 1996 and rules were framed in 1998, except for a few states, no states or union territories showed an interest in forming a BOCWWB until Supreme Court intervention in 2006 to constitute the welfare board and register and roll out the benefits. At present, there are about 4.46 crore building and construction workers in India, of which only 23 per cent (1.10 crore) are registered with welfare boards across the country. The fate of the rest remains in the dark. This shows the indifferent attitude of the Central and state governments, compelling workers to live in deprivation. "Registration of building and other construction workers should be made mandatory," emphasises Goutham Reddy, Executive Director, Ramky Group. "And if contractors have failed to comply with the guidelines, they should be heavily penalised by the state government." Face the facts It is a fact that the construction industry has created lakhs of jobs, absorbing villagers in the hot, dusty building sites of the booming industry. But these unskilled workers - recruited by labour agents, dispatched to faraway places and clueless about their rights - live and work in squalor that the government has shown little will, or ability, to improve. Here are some figures as per International Labor Organization: About 66 per cent of labourers currently live in self-constructed temporary sheds nearby construction sites. Nearly 75.4 per cent of construction sites lack sanitation and the hygiene levels of temporary sheds are very poor. About 73.8 per cent of sites do not have any toilets. One solution here is the adoption of portable washrooms at construction sites, like the solution offered by Pune-based Saraplast. Portable washrooms should be made mandatory on sites," says Rajeev Kher, Founder and CEO, Saraplast. (To learn more, visit http://bit.ly/1rcBYyo) 72.2 per cent of companies are reluctant to pay medical costs and majority of construction companies do not make provision of medical leave facilities for their labourers. Moreover, 63.5 per cent do not provide compensation benefits. In the 66.2 per cent of construction sites, labourers have to work a spread of about 10-11 hours a day with no overtime payment. Where, then, can a labourer expect justice (see the box above)? For its part, the government has failed to take action against contractors who are unregistered and have denied construction workers their basic rights. "Nearly 10,000 labour contractors in India are unregistered, providing labourers to various infrastructure projects," says a senior official from the Ministry of Labour and Employment. As per the ministry data, 18 lakh labour contractors were covered by licences in the year 2012-13. The ministry has detected 81,475 cases of irregularities by labour contractors, mainly holding payments of workers till three months. During 2012-13, the ministry registered 11,702 cases under the BOCW Act, but disposed of only 1,040 cases with claims amounting to Rs 16 lakh. Shackled and gagged The laws are meant to be broken - it seems to have been unfortunately the case with the Building and Other Construction Workers' Welfare Cess Act, 1996 (WC Act), which regulates employment, service conditions, health, safety and welfare measures of building and other construction workers. The Act has been put on the backburner by various states. Data from the ministry indicates that Rs 11,127 crore has been collected by various states as building and construction workers' cess until September 30, 2013. However, only Rs 1,448 crore (13 per cent) has been spent on labour welfare while Rs 10,000 crore remains unused in the treasuries of state welfare boards. Despite these directives, according to the National Campaign Committee (NCC) for central legislation on construction labourers, in many states, instead of implementing a mandatory benefits board under Section 22 of the main Act, officials divert funds towards activities where they make huge commissions like distribution of cycles. "Corrupt officials are delaying registration of construction workers as beneficiaries, creating hurdles in the simple process of paying annual contribution to remain entitled to receive benefits, not keeping a proper list or record of live members, complicating the process of delivering benefits, not keeping proper records of cess collected from compulsory registration of establishments and preferring private bribes instead of collecting due cess amount," says Subhash Bhatnagar, National Coordinator, NCC-CL, in his PIL filed in the Supreme Court in November 2013. The order of the Supreme Court bench headed by then Chief Justice SH Kapadia in February 2012, suggests that the funds available with the welfare boards should not be utilised for any other head of expenditure of the state government. When questioned about fund utilisation, Oscar Fernandes, Union Minister, Labour and Employment, puts the ball back in the state government's court. "I agree that the funds remain unused and state governments have the mandate to constitute welfare boards as it is a state subject," he says. "Although some states are doing good work, the rest have failed to act in accordance with the spirit of the Act," adds the disappointed minister. (For his elaborate views, Click here) "Most workers are migrants and do not have documentary proof to avail benefits," rues MB Reddy, Vice-President, Migrants Rights Council. "In many cases, contractors have not registered their workers with the state labour department. Largely unaware of benefit schemes, the workers continue to lose out on their rights." Further, as Ketan Jani from Bhuda Consultancy, a manpower agency from Gujarat, points out, "To get registered, a worker needs to have worked for three months in the past one year. However, most migrants are brought on three-month contracts after which they return or change cities." The collection of the 1-per-cent cess under the Act is still a mystery. When CW tried to gather data on this, the boards were unwilling to share. "Despite having a central agency on top, there is no one to check whether the collection is done on a regular basis or not," comments VB Gadgil, CEO and Managing Director, L&T Metro Rail (Hyderabad) Ltd. Southern states have been better performers. Kerala has registered 17 lakh workers under the scheme and has spent 82 per cent of the total cess collection of Rs 546.88 crore; and Tamil Nadu has registered 22.84 lakh workers and spent 45.99 per cent of its cess collection of Rs 604.31 crore; while Chhattisgarh has spent only Rs 56.43 crore of its cess collection of Rs 222.18 crore. Meanwhile, a Bill for amending the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, and Building and Other Construction Workers Welfare Cess Act, 1996, is gathering dust in the Rajya Sabha. Hazard zones Rights aside, most construction sites are potential minefields for workers. The majority of construction companies (67.2 per cent) do not make provision for helmets for workers. About 25.4 per cent do not make provision for safety belts. In addition, 69.1 per cent companies do not make provision of safety materials at construction sites. "We have to pay for our own treatment from our daily savings," says Kumar. "Our contractors do not take care of our health and we live in unhygienic conditions." He tells us how, three months ago, while climbing bamboo scaffolding, his colleague fell and fractured his leg. The local contractor refused to help and the hospital authorities showed the labourer the door as it was a police case. With the help of a corporator, he was admitted to a hospital and the entire cost was paid from the corporator's corpus. Now, he has a steel rod in his leg and has taken up a security job to survive. Reputed contractors say that the entire construction fraternity should not be blamed. "It is true that some contractors do not take care of workers but workers also have to share the blame," argues Gadgil. "If a labourer is not serious about getting registered, even the government cannot help as it needs to gather age proof, which is a necessary document to get registered under the two Acts - BOCW and BOCWWC." This said, it is a reality that conditions are harsh for workers. In April 2013, nearly 1,000 migrant workers were discovered working in slave-like conditions in Bengaluru on a project of the Army Welfare Housing Organisation. They were kept in locked sheds, paid petty amounts, and beaten by supervisors if they complained. What's more, a paper presented by noted academician Sarbeswara Sahoo at a national workshop on safety, health and welfare measures for construction workers two years ago at the Mahatma Gandhi Labour Institute in Ahmedabad, highlights a serious risk of cancer from the handling of asbestos. "Equally alarming is the number of workers who succumb to dust-related illnesses, asbestosis, silicosis, mostly in the process of carrying raw materials for construction," his paper mentions. Now, many NGOs and construction workers associations have submitted a proposal for the inclusion of construction workers in the Employee State Insurance Corporation (ESIC) Scheme. If the government accepts and modifies the proposal, it will allow a labourer to avail social and economic benefits off-site. As per data from the Ministry of Labour and Employment, the number of insured persons covered under the ESIC Scheme was 1.71 crore as on 2012-13. The number of beneficiaries covered under the scheme has gone up to 6.63 crore in 2012-13 from 33.25 lakh in 2011-12. Meanwhile, the ESIC has disbursed Rs 681.85 crore as benefit in cash. Skill-wage war One of the major concerns for infrastructure players is the need for skilled labour - a FICCI survey estimates the total expected shortfall of skilled labourers to be 16.77 crore in 2022. Of this, 61 per cent will be in the infrastructure sector, followed by 19 per cent in building and construction, 11 per cent in logistics and transport, and 8 per cent in real estate. "We have a huge task and have taken a step forward in this regard by introducing a skill development programme where we have included six skills in different stages for labourers," says S Ramadorai, Chairman, National Skill Development Corporation. "This programme will give labourers their due right of higher wages as well as a universal certificate that can be used anywhere in the country." However, on the wage front, contractors and labour federations are at loggerheads; one lobby claims wages are at par with industry norms, while labour unions tell a different story. According to the Kolkata-based Construction Workers Federation of India, the average minimum wage for labourers ranges from Rs 300 to Rs 500 per day for an eight-hour shift but contractors pay well below the government minimum wage rules. Countering the Federation's claim, BD Mundhra, former Chairman, Simplex Infrastructure, says, "At present, unskilled labourer wages are at par with those of skilled workers as all the reputed contractors adhere to the guidelines set by the Labour Ministry." In fact, several engineering, procurement and construction contractors claim the average wage of a labourer, whether skilled or unskilled, at about Rs 650-800 per day for an eight-hour shift. They complain that the rising cost of labourers has started making a dent on the cost of the project. Their contention is that, earlier, the cost of labour for any construction project was 2 per cent; with the demand-supply mismatch and high cost of labour, it is now adding up to 5 per cent of the overall project cost. "We pay a high cost to labourers who are mainly unskilled, and eventually, we end up delivering projects beyond deadlines," says Reddy. Gadgil agrees, adding, "I would rather pay a high cost to a skilled labourer and get my project done well within stipulated deadlines." To this, Ajit Gulabchand, Chairman, Construction Skill Development Council India, comments, "That is why, once a labourer gets trained with the National Skill Development Council and completes its certificate course, the trend to pay the same amount to unskilled labourers will be arrested." Agenda for action All considered, it remains uncontested that the lot of the Indian construction labourer is an unenviable one. And it is vital to remember that in the rush to develop, India should not become another Qatar. CW offers some action points for the new government in this regard: State governments should open district centres to create awareness among workers and empower them to get registered under the two welfare acts. Registered workers could be issued ID cards that could be used for insurance, PF, ESIC, bank account and training certification. The Indian government should start its own manpower bank after taking applications from all levels, mainly from the village, panchayat and taluk, using these agencies as umbrella agencies for registration and ID cards. Through registered manpower agencies, the government can provide labour requirement to projects that will have registered workers. The Central or state government should encourage vocational training centres for construction workers by giving them a tax rebate and making it compulsory for all local registered labour contractors to send in their workers for periodic training. The state governments, for grievance redressal, can also constitute units at district, panchayat or taluk level. There should be tax benefits for contractors for training workers; 200 per cent weighted tax deduction can be given on the expenses incurred for training. The rule of compulsory provident fund for employees working for 90 days should be brought down to 30 days. While charging 1 per cent cess, the government should set aside 50 per cent of it towards skill development. For his part, the Union Minister has promised CW that his ministry will crack the whip on those states who have underperformed in collecting cessas well as utilising it for the welfare of construction workers. It is a promising step; we will now wait for the follow-through, no matter who the next government may be. The case against Qatar $140 billion of infrastructure spending is forecast to get Qatar ready to host the 2022 World Cup. 500,000 extra workers will be needed in the run-up to the World Cup. 1,200 workers have died since the World Cup was awarded in 2010. 4,000 workers could die before a ball is kicked in the 2022 World Cup. 218 Indian nationals died in 2013, 237 in 2012 and 239 in 2011. Migrant workers constitute over half the population of Qatar - 1.4 million in a country of 2.068 million people. The workers had their passports withheld and were paid just $220 a month. Source: International Trade Union Confederation Whom to approach Construction workers can approach the State Labour Commissioner's Office to get their grievances addressed. They should approach the Government Labour Officer. If he does not take up their case, they can approach the Assistant Commissioner of Labour, and finally the Commissioner of Labour. (For more legal information, log on to www.labour.nic.in) Source: Ministry of Labour and Employment, Government of India Building and Other Construction Workers Welfare Board (BOCWWB) Under the schemes of the BOCWWB, a construction worker once registered at the Board is eligible for various benefits, including accident compensation of up to `1 lakh, hospitalisation expenses, maternity assistance, education benefits for children, marriage assistance for children, and so on. BOCWWB takes a registration fee of `25 and a monthly fee of `10 from each worker for these benefits. Source: PRS Legislative Research Compensation, insurance and safety 63.5 per cent of companies are not making provision of compensation benefits 67.2 per cent of construction companies do not make provision for helmets 69.1 per cent companies do not make provision for safety materials and equipment 66.2 per cent labourers have to work 8 hour having a spread over about 10-11 hour in a day Source: International Labor Organization The legal view Being a construction worker, the risks are inherent - the chances of injury in a job are high while working on high altitudes and complex equipment. Karthik Muthuveeran offers a legal perspective... According to estimates, dangerous work conditions in construction sites are one of the leading causes of work related death and disability in India. Unfortunately, the figures of dying and ailing workers are never recorded. Being a part of the unorganised sector, workmen are at a liability in negotiation for fair wages. Even agreed wages are not paid on time, let alone payment for overtime. Even after the construction work is over, substantial dues in wages often remain with builders or contractors. To make matters worse, countless construction workers do not even have social security and benefits in terms of labour welfare measures and provisions. For over 50 years, India has always had some rules and regulations in place on occupational health and safety. However, the regulatory authorities are limited to 1,400 safety officers, 1,154 factory inspectors, and a mere 27 medical inspectors; numbers that are grossly inadequate even for the inspection of formal units. Consider that there are over 3.5 crore construction workers in India at present and the crisis becomes apparent. Act of law In 1996, the Central Government enacted a few laws for construction workers to ameliorate their situation. With a view to regularise wages, working conditions, safety and health and welfare measures, the Government emerged with two enactments: the Building & Other Construction Workers (Regulation of Employment and Conditions of Service (RECS Act), 1996; and the Building and Other Construction Workers' Welfare Cess Act, 1996 (WC Act). "However, the workers are not even aware of the Welfare Board's existence," points out Mohit Kapoor, an advocate on labour issues. There is another significant question to be asked: Are the states following these rules? In spite of a good legal framework for the protection of workers, India suffers from the chronic problem of lax implementation. The present state of the implementation of the provisions of BOCW (RECS) Act, 1996 does not seem to be encouraging. "The biggest drawback of the Act is that it is only applicable to establishments employing 10 or more workers in any building and other construction works," adds Kapoor. "As India is a poor country, workers mostly work for small-time establishments." Gathering dust Kodikkunnil Suresh, Minister of State (Labour and Employment), has introduced the Building and Other Construction Workers Related Laws (Amendment) Bill, 2013, in the Rajya Sabha. Enacted to provide safety, health and welfare measures to building and construction workers, it is still gathering dust. The Bill seeks to amend two laws: the BOCW (RECS Act 1996) and the BOCWWC (WC Act 1996). The RECS Act regulates the employment, service conditions, health, safety and welfare measures of building and other construction workers. Under the RECS Act, every building worker between18 and 60 years of age, who has been engaged in any building or construction work for at least 90 days (during the past one year), is eligible to register as a beneficiary. The amendments remove the following: (i) 90-day requirement for registration of workers and (ii) the upper age limit of 60 years. The RECS Act is being amended to remove the upper limit of Rs 10 lakh as the total cost of construction. The Bill allows the Central Government to notify the maximum cost of construction. The WC Act provides for the levy and collection of cess on the employer, at the rate of 1-2 per cent of the cost of construction incurred by him. The cess is paid to the Building and Construction Workers' Welfare Board constituted under the RECS Act. The WC Act is amended to prescribe a time limit of 30 days for cess collecting authorities to deposit cess to the Welfare Board. Here are the special legislations and Acts: The Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 The Contract Labour (Regulation and Abolition) Rules, 1971 The Employees' Compensation Act, 1923 The Minimum Wages Act, 1948 The Employees' State Insurance Act, 1948 The Employees' Provident Funds and Miscellaneous Provisions Act, 1952 The Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Central Rules, 1980 Equal Remuneration Act, 1976 "States have failed to collect and utilise cess." Oscar Fernandes, Union Minister for Labour and Employment, Government of India While the wage board remains a state subject and utilisation of cess collected is at a minuscule level, the Government is likely to enforce laws and raise the compensation limit for the welfare of construction workers. That said, Oscar Fernandes, Union Minister for Labour and Employment, Government of India, elaborates upon encouragement for permanent employment rather than contracts, in a conversation with RAHUL KAMAT. Why do labourers fall prey to exploitation despite laws being in place? The question is: How are we supposed to know that workers have been denied their basic rights unless they complain? The labourers, in agreement with contractors, agree to lower wages than permitted. In such cases, if a labourer is getting trapped knowingly, even the Government cannot help much. We have passed appropriate legislation in the Parliament to address the concern. Nowadays, the contractor community is interested in providing employment on a temporary basis. But employers have to consider any human hiring on a permanent basis through which they (workers) will be entitled to all rights under various laws and acts. While a few states have a decent cess collection, some states have failed. What is your observation on this? I have conducted rounds of meetings with respective departments in various states and have asked them to make an assessment of how much money is due to be collected, how much has been collected and how much has been spent. In order to expedite the process of implementation, a special group has been formed to assist the state governments in the formation of rules. I have observed that despite many ongoing projects across India, state governments have failed to collect the cess (For detailed statistics on performance of state governments refer page 45). In fact, they have not collected cess from government projects too. And even if it has been collected, the spending is minuscule. They are not bothered as the law has not been enforced. Meanwhile, I must admit that cess collection is a state subject. There is resistance on wage structure from private contractors or companies. How are PSUs looking at it? The Government intends to ensure equal rights to all, whether contract labourers or permanent. We are hell bent on this and have notified private companies that wages for contract labourers should be in line with permanent labourers. Why discriminate? At present, we are working on formulating amendments to the current law. Moreover, there is consensus from all the state governments but unless there is legislation, we cannot enforce it. I am always of the opinion that the government sector should take this initiative first. Meanwhile, the wage structure for contract labourers in PSU establishments will increase by about Rs 11,000 crore and the provident fund (PF) contribution from the Government's side will go up by Rs 150-160 crore. On the PF front, contractors are reluctant to contribute as they are already contributing through 1-per-cent cess... I agree that state governments are collecting 1-per-cent cess of the project cost. And I even know that contractors are not willing to contribute through PF. They argue why they should pay PF for a worker who works for just a day. Our argument is, why are you involving a worker for just a day? Rather, appoint him until the project is complete. Private contractors must take initiatives for the welfare and social guarantee of labourers. How is the Government dealing with the migration issue taking into account the distribution of PF? The issue of migration does not matter here. Our ultimate aim is to provide PF facility for a worker whether he is a migrant or not. As the amount will go straight into the labourer's account, there will be no difficulty for him and he can avail PF from state or district centres. It has been observed that in fatal accidents, contractors refrain from paying compensation. And the compensation from the Government is too little. Your comments... Ultimately, it will be the responsibility of the principal employers as they have to sign an agreement with labourers under the Workmen Compensation Act. It is well known that the practices have not been followed; that's why we are registering these labourers under a government scheme where we give them a smart card through which they can avail compensation from the Government. As far as the amount is concerned, we are planning to raise social security cover to Rs 1 lakh from Rs 75,000. In 2013, about 3.41crore smart cards were active and 42.57 lakh persons have availed hospitalisation facilities in 28 states. (With inputs from Garima Pant and Shriyal Sethumadhavan) To share your suggestions on labour and related aspects, write in at feedback@ASAPPmedia.com To see a video on this subject log on to www.ConstructionWorld.in