LAW

AND
POVERTY
MADE BY:
Aquib ahmed
B.A. L.L.B. (Hons.)
IVTH semester

Unorganised
labour and
the law

INDEX
Topic
Page no.
2

1. Unorganised Nature of Rural Labour

2. Contextual Framework

3. Concept and Classification of Rural Labour

4. Wages of Agricultural Labourers and the Law

5. Social Security for the Unorganised Labour

11
19

6. Organisation of Rural Workers

23

Unorganised Nature of Rural Labour

The factual conditions of agricultural labour are quite different from
non-agricultural labour. Agricultural labour force is widely dispersed on
3

holdings, often of small size, which are scattered due to fragmentation and dubdivision. In view of this wide scatter of holdings, labourers who work mostly on
daily wages are unorganised. There is no agglomeration of labour on a farm
continuously for a long time to enable them develop collective bargaining
power as in industry. Due to this disability, agricultural labourers are susceptible
to exploitation by land-owners who employ them. Another inherent weakness is
the absence of a fixed occupation as agricultural labour, for most workers all
the year round. What labourers are concerned with is employment on
remunerative wages, whether it is in agricultural or non agricultural work.
Agricultural operations provide employment on a sufficiently large scale during
busy seasons. During slack seasons, however, they look for alternative avenues
of employment.

The extent of rural unemployment defies assessment as much of it designed.

According to Planning Commission the number of jobless people in the rural
sector is around 20 million, but unofficial estimates put the figure at 45 million.
Indeed, in the Indian agricultural sector the intensity of the problem lies in the
fact that agricultural labourers are unemployed for 168 days in a year. Further
unemployment adds to the intensity of the problem, and in rural context both
unemployment and underemployment get inextricably mixed. Either of it
voluntarily or involuntarily adds to the complications in analysing the situation.
But, statistics apart, in the years since Independence, the developments in rural
areas taken together indicate that some relief in terms of more work has already
reached them. Thus, the various Five Year Plans, particularly Fourth, Fifth and
Sixth Plans, have visualised the urgent nature of the problems of unemployment
and underemployment and has in fact formulated schemes for promoting self
employment, imparting training facilities, encouraging commercial banks to
advance loans etc. Further, provision has been made in the budget for schemes
designed to benefit small farmers, marginal cultivators and agricultural
labourers to meet the employment needs of certain areas. But the pace should be
accelerated and more job opportunities should be created.

Contextual Framework
(A) Size of Agricultural labour force

India is predominantly an agricultural country. According to the

1981 census, nearly 525.4 million people out of the total
population of 685.14 lived in rural areas. Further, 180.5 million
people who constituted and entire labour force in 1971 about
125.8 million i.e. 70.8 percent of the total work-force were
employed in cultivation and agricultural occupations. The
estimated work-force in rural areas in 1978 was 216.16 million
as against urban work-force of 44.76 million. Work-force in
agriculture was 192.43 million. The remaining 23.73 million of
the rural work-force was engaged in non-agricultural
occupations. However, the Planning Commission estimated that
by 1978, the work-force have gone up to 265.3 million and out
this agriculture would be employing 192.43 million. By 1983 the
work-force in agriculture is likely to go up to 213.83 million,
indicating an addition to 21.4 million persons in just 5 years.

(B) Agricultural Labourers Place in the Economy

India has been and will remain in the foreseeable future, predominance
agricultural nation. Agriculture in its broad connotation accounts for
approximately fifty per cent of our national income. According to the Central
Statistical Organisation the net national product generated in India in 1977-78
was estimated to be Rs.30621 crores and the number of workers on the land
(including land holders and landless) was 192.43. Food grains production was
estimated to be 131.9 million tonnes in 1979-80, when the country suffered a
severe drought. But, in spite of this agriculture labour occupies the lowest rung
of the rural ladder. A major part of the area in rural areas is concentrated in a
few hands. For example, in 1971 the top 30 per cent of the rural population
claimed nearly 82 per cent of the total assets and within this group the first 10
per cent monopolised as much as 51 per cent of the total assets. On the other
hand, the lowest 10 per cent possessed a mere 0.1 per cent of the assets and the
lower 30 per cent were to be contended with a 2 per cent share. The disturbed of
agricultural holdings, the small and marginal farmers, who constituted over 70
per cent of the land owners, operates barely 24 per cent of the agricultural land.

(C) Rural Poverty

Poverty is the greatest economic evil in a welfare state. Agricultural
labour that constitutes about one-fifth of the rural work force is the poorest of
the poor in India. Fifty per cent of the agricultural labour households are
landless and have no asset base. The landless labourers are suffering from a
compounded problem of unemployment, low and uncertain income and
nutritional deficiencies. Low incomes, indebtedness, unemployment and
underemployment, big size of the family illiteracy and ignorance may primarily
be accounted for the high degree of poverty among rural workers.

(D) The Present Attack: Economic Front

Jawaharlal Nehru warned the Constituted Assembly about the problem of
poverty and social change:
The service of India means the service of the millions who suffer. It means the
ending of poverty and ignorance and disease and inequality of opportunity. The
ambition of the greatest man of our generation has been to wipe every tear from
every eye. That may be beyond us, but as long as there are tears and suffering,
so long our work will not be over.

It is significant to note that various Five Year Plans have taken some
steps to achieve the desired objective. Soon after the commencement of Indian
Constitution the Planning Commission was introduced in India. The basic
objective of the First Five Year Plan was summed up by the planners in the
following terms:
The Plan has two main objectives: (1) a better standard of life for the people
and (2) social justice. The objectives of the Plan reflect the idealism of the
community and are derived from the Directive Principles of State Policy
embodied in the Constitution. These principles envisage equality of opportunity,
the right to work, the right to an adequate wage and a measure of social security
for all citizens. A Welfare State is the avowed goal of our Constitution. To
achieve this new order, the Plan has taken the first few steps.

The Second Five Year Plan emphasised on the expansion of the community
development programme, Rs.200 crores were allocated for development of
village and small industries. In rural programmes high priority was given for
schemes intended to benefit the weaker section of the population like
agricultural labourers and artisans and others.

The Third Five Year Plan laid considerable emphasis for the cause of
agricultural labourer. The Plan provided for additional employment in
agriculture for about 3.5 million. However, in the Plan rural works programmes
and rural industries projects received half-hearted support, and were even
interrupted.

The Fourth Five Year Plan drew attention to the problems of submarginal cultivators, and agricultural labourers by two sets of measures viz.
(i) land reforms and (ii) generation of employment oriented activities.

The Fifth Plan was intended to make substantial reduction in the

magnitude of poverty.

The Sixth Five Year Plan brought new era during which the major goal was the
realisation of an economic and social order based on principle of socialism,
secularism and self reliance. The Plan used the poverty line of Rs.65 per month
at 1977-78 prices for rural areas. In order to remove rural poverty the Plan has
allocated Rs.1500 crores for the Integrated Rural Development Programme
(I.R.D.P.) which seeks to create productive assets in rural areas.

On 15th August, 1982 Prime Minister Mrs. Gandhi in her Independence Day
address announced a scheme under which one member of every family in the
country would be given a job. The Prime Minister however did not spell out the
scheme in detail but assured that funds would not be a problem. On that basis
jobs for 30 lakh persons would mean creation of 300 million man-days in a
single year.
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Concept and Classification of Rural Labour

Since the rural labour persons who are agricultural labour, as well as holders of
petty plots or cultivators of small plots on behalf of the rural owners it is very
difficult to identify the agricultural labour as such if one has to go strictly by the
occupation only, becausethe occupational structure in a village is overlapping in
character. The casual nature of employment, which keeps them shifting from
one farm to another, further adds to the difficulty of identification. Be it as it
may, the rural labour may broadly be classified into the following categories:
(A) Agriculture Labour
It is very difficult to define the agriculture labour. Section 2(f), of the Kerala
Agricultural Workers Act defines agricultural worker to mean:
a person who, in consideration of the wages payable to him by a landowner,
works on, or does any other agricultural operation in relation to the agricultural
land of such landowner.

The aforesaid definition postulates a wage-earner under a landowner, either

working on agricultural land or doing any other agricultural operation in
relation to such land.

Earlier, the National Commission on Labour defined agricultural

labour to be persons whose main source of income is wage employment. It
consists of two sub-categories: (i) landless agricultural labour, and (ii) very
small cultivators whose main source of earnings, due to their small and submarginal holdings, is wage employment. However, the aforesaid definition of
agricultural labour does not accord with the 1981 Census definition agricultural
labour wherein it is defined as:
one whose principal means of livelihood is wage income arising out of the
farm labour and other allied activities.
It will thus be seen that the scope of agricultural labour still remains uncertain.

(B) Para-Agricultural Labour

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Labour who are employed in activities incidental to or in conjunction with the

agricultural operation subsequent to harvesting such as grains processing, hand
pounding of rice or other food grains, splitting of pulses, splitting of maize or
other food grains or even preparation for selling or delivery to storage or to
market may be called para agricultural labour.

(C) Rural Labour in Allied Activities

The rural labour employed for wages either in cash or in kind or partly in cash
and partly in kind in dairy farming, raising of live stock, bees or poultry
grazing, collective cow dung or selling the agricultural commodities may not be
called agricultural labour and may well be classified under the aforesaid
category.

(D) Plantation Labour

The plantation labour in India includes all those who are employed in any
agricultural undertaking which is mainly concerned with the cultivation or
production for commercial purposes of coffee, tea, sugarcane, rubber, bananas,
cocoa, coconut, groundnuts, cotton, tobacco, fibres, citrus, palm oil, cinchona or
pineapple.

(E) Bonded Labour

Bonded labourers constitute one of the most exploited section of the rural
labour. It is the relic of feudal exploited system. Till recently there existed in
our country a system of usury under which the debtor or this descendants or
dependants had to work for the creditor without reasonable wages or with no
wages in order to extinguish the debt. At times, several generations work under
bondage for the repayment of a paltry sum which had been taken by some
remote ancestor. The interest rates were exorbitant and such bondage could not
be interpreted as a result of a legitimate contract or agreement. This system
implies infringement of basic human rights and destruction of the dignity of
human labour. The practice of forced labour is condemned in almost every
international instrument dealing with human rights.
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(F) Labourer in Forestry

Notwithstanding the fact that the Agricultural Labour Enquiry Committee and
Rural Labour Enquiry Committee treats workers employed in forestry and
timbering operation to be agricultural labour they may be kept under separate
category viz., forestry labour.

(G) Rural Labour for Other Work

Quite apart from the aforesaid classification there are other classes of
rural labour such as barber, washer man, milkman, carpenter, blacksmith,
cobbler etc. who work either on part time or fulltime basis wages in cash kind or
share of produce on another persons land.

(H) Self Employed Person

A person may be regarded as self employed in an occupation if
he is working as an employer or own account worker in that
occupation. An own account worker could be both a single
worker or joint owner of an enterprise.

Wages of Agricultural Workers and the Law

10

In order to appreciate the prevailing low rates of wages it is desirable to know

the average earnings of some of the agricultural and other rural workers. The
estimated average daily earnings of men, women and children in agricultural
and other rural household reveals that there was a sharp increase in the average
daily earning during 1974-75. But, the high rate of wages could not keep pace
with the increase in the cost of living index. The wage rates are so low that it
may be called even starvation wages.

(A) Minimum Wages Act, 1948

Problems relating to minimum wages of agricultural workers attracted the
attention of I.L.O. way back in 1921, I.L.O. adopted Minimum Wage
(Agriculture) Convention, 1921.Seven years later in 1928 the Minimum WageFixing Machinery Convention was adopted by the I.L.O. in 1928. The
Convention recommended to the Member States the desirability of setting up
machinery for fixation of minimum rates of wages in certain industries. The
object of the convention was to fix minimum wages in industries in which no
arrangements exist for the effective regulation of wages by collective agreement
or otherwise, and wages are exceptionally low. India has however, ratified the
1928 Convention. To give effect to the convention the Central Legislature
passed the Minimum Wages Act, 1948. The Act prevents the exploitation, inter
alia, of agricultural workers.

(1) The Coverage of the Minimum Wages Act

The Act extends to the whole of India. Part 2 of the Schedule to
the Act covers employment in agriculture. The appropriate
Government is empowered to add to the Schedule any
employment after giving by notification in the Official Gazette
not less than three months notice of its intention so to do.
Under this provision Central Government and several State
Governments have fixed minimum wages for agricultural
workers. However a good number of agricultural workers are
still outside the purview of the Act. If the object of the Act is to
project sweated labour against exploitation there is no longer
any justification for keeping a vast number of persons
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employed in exploitative conditions in agricultural occupation

without protection about their wages.

Government is committed to the uplift of the

weaker sections of the society. Adoption of the 20-point
programme makes it incumbent upon the Government to give
serious attention to the fixation and revision of minimum
wages. It is therefore essential that types of agricultural
workers who are working under conditions of sweated labour
and/or essentially below the poverty line should be brought
within the purview of the Minimum Wages Act so as to assure to
them a wage which is essential for at least their subsistence.

(2) Fixation and Revision of Minimum Wages

While appropriate Government is under an obligation to fix minimum rates of
wages in the entire state in respect of employments specified Part 1, it has
discretion to fix minimum rates of wages even in a part of the State in respect of
employment specified in Part 2 of the Schedule. Further the appropriate
Government shall not be required to fix minimum rates of wages in respect of
any scheduled employment in which less than one thousand employees are
employed at a given time in the whole of the State. The appropriate Government
may fix minimum rate of wages for time work, piece work and overtime work
and a guaranteed time rate for piece work. Further, in fixing or revising
minimum rates of wages different minimum rates of wages may be fixed for (i)
different scheduled employment, (ii) adults, adolescent, children and
apprentices; and (iv) different localities. Similarly, the minimum wages may be
fixed by any one or more of the following wage period, namely (i) by the hour
(ii) by the day (iii) by the month or (iv) by such other longer period as may be
prescribed.

The Minimum Wages Act, however, neither defines minimum wage

nor does it lay down criteria to be considered in determining the minimum wage
in any given case. To fill this gap Courts have helped that statutory minimum
12

wage is higher than the bare subsistence wage and provides for measure of
education, medical requirement and amenities. The Courts have also ruled that
the policy and principle for the guidance for the exercise of this power is
inherent in the purpose and object of the Act, and the machinery enacted for
assisting the Government in making the equitable adjustment of conflicting
claims of labour and management.

(3) Time for revision of Minimum Wages

Wage structures are not static and are liable to be revised with the
change of circumstances. The Act, therefore, empowers the appropriate
Government to review the minimum rate of wages so fixed and revise the
minimum rate at such intervals as it may think fit. A perusal of wages revised
reveals the fact that the minimum rates of wages have not been revised for more
than five years, from the date of fixation/revision by the appropriate
Government. The period varies from six to twenty years.

(4) Choice of Minimum Wage Fixation Process

The Act empowers the appropriate Government not only to fix
minimum rates of wages in respect of any scheduled employment for the first
time or in revising minimum rates of wages so fixed but also to choose either of
the following two processes:(i) appoint as many committees and sub-committees as it considers necessary to
hold enquiries and advise it in respect of such fixation or revision, as the case
may be
Or
(ii) by notification in the official Gazette, publish the proposals for the
information of persons likely to be affected thereby and specify a date, not less
than two months from the date of the notification, on which the proposal will be
taken into consideration.

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(5) Mode of Payment

Section 11(1) of the Minimum Wages Act, 1948 provides for the mode of the
payment of minimum wages. It requires that the minimumwages should be paid
in cash. But sub-sections (2), (3) and (4) of Section 11 provides for the payment
of minimum wages in kind wholly or partly in certain circumstances and for
essential supply of commodities at concessional rates.

(6) Payment of Minimum Rates of Wages

Section 12 imposes an obligation upon the employer to pay every
employee engaged in a scheduled employment under him wages at a rate not
less than minimum rate of wages fixed by the Government subject to deductions
and as may be authorised and subject to such conditions as may be prescribed.
This provision will, however, not affect the provisions of the Payment of Wages
Act, 1936.

(7) Fixing Hours for a Normal Working Day and Overtime

Section 13 empowers the appropriate Government to fix the working
hours and the days of rest as therein indicated in regard to any scheduled
employment in respect of which minimum rates of wages have been fixed. Rule
24 of the Minimum Wages (Central) Rules prescribes 9 hours of work for adult
workers and 4.5 hours of work for child labour per day. But these provisions are
not being observed by employers in agricultural sectors. It is because of
variation in the length of working day based on seasonal emergencies of
agricultural production that the Minimum Wages (Central) Rules framed under
the Minimum Wages Act, 1948, while prescribing that 9 hours constitute the
normal working day for an adult, provided that, in so far as agricultural
employments are concerned, they may be subjected to such, modifications as
may, from time to time, be notified by the Central Government.

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(8) Enforcement
For the administration of the Act the State Government have been
authorised to appoint Inspectors. With the announcement of the New 20-point
Programme by the Prime Minister on the 14 th January, 1982, the Department of
Labour, Government of India drew up the following Plan of Action to secure
fixation and revision of minimum wages for employment in agriculture and
their effective enforcement:
(i) to persuade the State Governments concerned to fix minimum wages;
(ii) to expedite the revision of minimum wages by State Governments which
have already notified proposal or constituted committees for the revision of
minimum wages;
(iii) to persuade the State Governments to initiate action for the revision of
minimum wages where no such action has yet been taken;
(iv) to expedite the finalisation of proposals for amendment of the Minimum
Wages Act to improve its working;
(v) to advise the State Governments to setup monitoring units in their Labour
Departments to monitor the progress of implementation and send reports to the
Monitoring Unit set up in the Department of Labour.

(B) Supreme Courts Contribution towards payment of minimum

wage
(1) Payment of bare subsistence or minimum wage
In order to protect the interest of weaker sections of the society the
Supreme Court ruled that if the employer cannot pay to its workmen at least the
bare subsistence or minimum wage, it has no right to exist.

Thus, in Crown Aluminium Works v. Their Workmen, the Supreme

Court observed:

15

It is quite likely that in underdeveloped countries, where unemployment

prevails on a very large scale, unorganised labour may be available on
starvation wages, but the employment of labour on starvation cannot be
encouraged or favoured in a modern democratic welfare state. If an employer
cannot maintain his enterprise without cutting down the wages of his employees
below even a bare subsistence or minimum wage, he would have no right to
conduct his enterprise on such terms.

(2) Non-payment of minimum wages amounts to violation of

Article 23 of the Constitution
Where a person is suffering from hunger or starvation, where he has no
resources at all to fight disease or to feed his wife and children or even to hide
their nakedness, where utter grinding poverty has broken his back and reduced
him to a state of helplessness and despair and where no other employment is
available to alleviate the rigour of his poverty, he would have no choice but to
accept any work that comes his way, even of the remuneration offered to him is
less than the minimum wage. He would be in no position to bargain with the
employer he would have to accept what is offered to him. And in doing so he
would be acting not as a free agent with a choice between alternatives but under
the compulsion of economic circumstances and the labour or service provided
by him would be clearly forced labour.

In view of the prevailing situation the Supreme Court in Peoples

Union for Democratic Rights v. Union of Indiaruled that the word force must
therefore be construed to include not only physical or legal force but also force
arising from the compulsion of economic circumstances which leaves no choice
of alternatives to a person in want and compels him to provide labour or service
even though the remuneration received for it is less than the minimum wage.
The Court accordingly held that where a person provides labour or service to
another for remuneration which is less than the minimum wage, the labour or
service provided by him clearly falls within the scope and ambit of the words
forced labour under Art.23. Such a person would be entitled to come to the
Court to direct payment of the minimum wage to him so that the labour
orservice provided by him ceases to be forced labour and the breach of Art.23
is remedied.
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The aforesaid view was followed in Sanjit Ray v. State of Rajasthan 3

where in the Supreme Court reiterated that every person who provides labour
or service to another is entitled at the least to the minimum wage and if anything
less than the minimum wage is paid to him, he can complain of violation of his
fundamental right under Article 23 and ask the Court to direct payment of
minimum wage to him so that the breach of Art. 23 may be abated.

(3) Protection under Article 23 enforceable against the whole

world
Article 23 is designed to protect the individual not only against the
State but also against other private citizens. Article 23 is not limited to its
application against the State but it prohibits traffic in human beings and beggar
and other similar forms of forced labour practised by anyone else. The sweep
of Article 23 is wide and unlimited and it strikes at traffic in human beings and
beggar and other similar forms of forced labour wherever they are found.

(4) Constitutional obligation for the State to enforce the

Minimum Wages Act
The Supreme Court in Peoples Union for Democratic Rights v. Union of India
also pointed out with all emphasis at their command that:
whenever any fundamental right which is enforceable against private
individuals such as, for example, a fundamental right enacted in Aricle 23 or 24
is being violated, it is the constitutional obligation on the State to take the
necessary steps for the purpose of interdicting, such violation and ensuring
observance of the fundamental right by the private individual who is
transgressing the same. Of course, the person whose fundamental right is
violated can always approach the Court for the purpose for enforcement of his
fundamental right, but that cannot absolve the State from its constitutional
obligation to see that there is no violation of the fundamental right of such
persons, particularly when he belongs to the weaker section of humanity and is
unable to wage a legal battle against a strong and powerful opponent who is
exploiting him.
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It is hoped that appropriate Government would now take serious step

to implementation of the Minimum Wages Act particularly in agricultural and
unorganised sectors.

(C) Payment of Wages Act

Section 22F of the Minimum Wages Act empowers the appropriate
Government to direct that subject to the provisions of sub-section (2) all or any
of the provisions of the Payment of Wages Act, 1936 shall with such
modifications, if any, as may be specified in the notification apply to wages
payable to employees in such scheduled employments as may be specified in
the notification. The inspectors appointed for the purpose of enforcement of the
provisions so applied acts within the legal limit. In exercise of these powers the
Central Government has applied the provisions of the Payment of Wages Act,
1926, inter alia, in respect of employees in employment included in Part 2 of the
Schedule. Further, States have also applied the provisions of the Payment of
Wages Act.

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Social Security for the Unorganised Labour

The need for providing social security benefits was recognised by the
International Labour Organisation since its inception through the I.L.O.
Conventions viz., Workmens Compensation(Agriculture) Convention, 1921,
Sickness
Insurance(Agriculture)
Convention,
1933,
Invalidity
Insurance(Agriculture) Convention, 1933, Survivors Insurance(Agriculture)
Convention, 1933 and Minimum Age(Agriculture) Convention, 1921. India has
however not ratified any of the conventions. But, the framers of Indian
Constitution paid due attention to the amelioration of labourers of the country.
The Indian Constitution has made a specific mention of the duties that the State
owes to rural labourers. Article 43 of the Constitution provides that the State
shall endeavour to secure by suitable legislation...to all workers agricultural,
industrial or otherwise...conditions of work ensuring a decent standard of life...
In order to achieve the objective several social security legislations have been
enacted in India. They are, however, applicable to a very negligible section of
rural population.

(A) Workmens Compensation Act, 1923

The Workmens Compensation Act which imposes an obligation upon
employers to pay compensation to workers for accident arising out of and in
the course of employment, resulting in death or total or partial disablement is
also applicable to workers employment in farming by tractors or other
contrivances driven by steam or other mechanical power or by electicity. From
this it is evident that the Act has an extremely limited application and does not
apply to all agricultural labour.

(B) Employees State Insurance Act, 1948

The Act is one of the pioneering measures in the area of insurance for workers.
It provides for (i) sickness benefit; (ii) maternity benefit; (iii) disablement
benefit; (iv) dependents benefit and (v) medical benefits. However, section 1(5)
empowers the appropriate Government, in consultation with the Corporation, to
extend the provisions of the Act or any of them to any other establishment or
class of establishment, including agriculture. However, these benefits, if at all,
19

are available only to a negligible section of agricultural labour, because of legal,

administrative and other problems. The question has been considered recently
by a high powered sub-committee of the Employees State Insurance
Corporation which has come to the conclusion that the scheme should be
modified to suit the consitions of rural area. The Central Standing Committee on
Rural Unorganised Labour set up by the Central Government is also
considering, inter-alia, the question of social security for rural workers.

(C) Maternity Benefit Act, 1961

Like the Employees State Insurance Act, the Maternity Benefit Act, 1961
empowers the State Government to extend the provisions of maternity to an
establishment or class of establishment including agriculture. This Act provided
for cash maternity benefit for certain periods before and after confinement,
grant of leave and certain other facilities etc. to women. However, this Act has
an extremely limited application and has rarely been applied in agricultural
sector. To avoid this hardship to agricultural women workers section 6 of the
Agricultural Workers(Payment of Pension, Fixation of Minimum Wages,
Compulsory Insurance and other Amenities) Bill, 1983 provides for payment of
maternity allowance of rupees fifty per month by the Government to women
agricultural workers for a period of three months and for one months maternity
leave with full pay. This provision if passed would provide much needed relief
to women agricultural workers.

(D) Provident Fund, Family Pension and Insurance

The Employees Provident Funds Act, 1952 provides for the institution of
provident funds for the employees in the factories and other establishments. By
Labour Provident Fund Laws(Amendment) Ordinance and Act, 1971 provision
has been made for Family Pension and Life Insurance Benefit also. The
Employees Family Pension Scheme became effective from 1-3-1971. In the
year 1976, the Act was further amended with a view to introducing yet another
social security scheme to provide and Insurance cover to the members of the
Provident Fund in covered establishments without payment of any premium of
such members, the Insurance cover being linked to the deposits in the provided

20

fund to the credit of the decease employees. The Employees Deposit linked
Insurance Scheme thus came to effect from 1-8-1976.

The Act, however, applies to a very small section of working class.

As on 30 September, 1979 the Act applied to 89977 factories/ establishments.
The number of subscribers to Provident Fund stood around ten million. More
than 11000 establishments with 1.8 million employees belonged to
industries/employments located predominantly in rural areas. Thus, a vast
majority of rural population has been kept outside the purview of the Act. To
meet this hardship the Agricultural Workers(Payment of Pension, fixation of
minimum wages, compulsory insurance and other amenities) Bill, 1983
provides for Agricultural workers Provident Fund scheme:
th

(1) The provident fund facilities shall be extended to the agricultural workers
and for that purpose the Central Government may, by notification in the Official
Gazette, frame a scheme to be called the Agricultural Workers Provident Fund
Scheme.
(2) In particular and without prejudice to the generality of the foregoing power
to frame the Scheme:(a) the Government and the employer of agricultural workers each shall
contribute separately to the provident fund at a rate of six and a quarter per cent
of the wages payable to each of the agricultural workers employed by an
employer;
(b) the expenditure on enforcement of the scheme shall be borne by the
Government;
(c) the agricultural worker shall be required to contribute two per cent of the
total wages to the provident fund.

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(E) Unemployment Insurance

More than seventy per cent of the total population live below poverty line.
Needless to mention that most of these unfortunate people are the agricultural
workers. They do not get work throughout the year. They get work for about
three months in a year and for nine months they are unemployed and suffer
from starvation. The reality is that they are ready to work for their livelihood
and for the progress of the country but the Government have failed to utilise
these human resources and this huge manpower is going waste due to nonutilisation. Another important factor is that the poor and marginal farmers are
losing their land every year and they are merely increasing the number of
agricultural workers, and this is a continuous process. Until and unless the age
old feudal practice of private money lending denying minimum wages to the
agricultural workers, creating bonded labour and exploiting them economically,
socially or culturally, is prohibited and simultaneously the Government came
forward with financial assistance, they will not be freed from the present social
evils.

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Organisation of Rural Workers

(A) Why to Organise
Organisation of rural workers is based on labour philosophy united we stand,
divided we fall. The Green Revolution, abolition of Zamindari System, and
introduction of mechanised farming changed the traditional outlook in the
labour management relationship. Next, the needs and expectations of rural
people have changed. Further, about half of the population in rural areas live
below the poverty line. Furthermore, the labour is in the state of bonded
relationship. Indeed, rurallabour is exploited by landlords. Moreover, unless
there is conscious and deliberate effort to develop organisations of the poor, the
whole exercise of growth with social justice becomes a mere platitude. The
formation of farm labour union provides the solution.

(B) Major Constraints in Organisation of Problem Areas of

Agricultural Labour
Notwithstanding Mahatma Gandhis emphasis on the value of self sufficient
village economy agricultural labour have been most neglected and exploited
class of human labour who have suffered because they happen to belong to
economically and socially backward class of society as also from the ravages
of sacrifices and famines in different parts of the country. Further, their
illiteracy, poverty, indebtness, seasonal nature of work in villages also create
obstacle. Heterogeneity and homogeneity and their migratory character also
work against their organisation. Agriculture workers also do not have almost
any experience in trade unionism. They are even unable to pay even the
membership subscription. Furthermore, there is danger of being suppressed, in
the formative stage of trade unionism by the landlord. Moreover, centuries of
oppressed and inhuman treatment received as untouchables have damaged their
confidence and lowered their self image.

(C) Trade Union Movement in Rural Areas

During the freedom struggle several socio-political organisations such as
KisanSabhas, KrishakSabhas and Peasant Unions came into existence in
the late twenties for the benefit of agricultural communities. In 1931 the
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KisanSabha in Bengal demanded abolition of Permanent Settlement and

forced labour. In 1935, the All India KiasnSabha took shape. A mass peasant
movement developed after the Second World War in some parts of the country
led by local KisanSabhas. By 1945, the Sabha claimed to have enrolled
membership of about 8.25 lakhs. Peasant organisations spread to other parts of
the country to protect the interests of the small farmer and labour from
backward communities and tribes such as halis and warlis in Bombay, and
Pannaiyals in Madras. The KisanSabha in 1953 called for abolition of
landlordism without compensation, free distribution of land among agricultural
labour and poor peasants, stoppage of eviction of peasants and substantial
reduction in rent. During post 1960 period, the All India KisanSabha agitated
against evictions of small peasants and for radical land reforms, distribution of
waste land, provision of irrigation facilities for all cultivators and for unity
between poor peasantry and agricultural labour who constitute the bulk of the
population in the countryside. During Kharif season of 1982, 2 million
agricultural workers directly participated in the strike and 4 million agricultural
workers participated in propaganda and campaign for struggle in different States
for increase in wages.

Besides this politically-oriented organisation, there are many small

organisations which are largely non-political. None of them, however, has been
able to bring together large sections of unorganised and scattered agricultural
workers and weld them into a force for concerted action. A weakness of the
Kisan Movement arises out of the dual character of the leadership of the
organisation. This in turn is the consequence of the operation of the parallel
interests of the leadership as small land-owners in villages and as salaried
employees or colleagues in urban areas. While they fight for their own
democratic rights and economic uplift in towns and cities, they hesitate to raise
their voice to secure higher wages for agricultural labour in rural areas in view
of their own involvement there as employers. Quite apart from this there are
several voluntary organisations that are active in organising rural labour.

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(D) Leadership of Rural Trade Unions

One of the significant features of Trade Union Movement in rural areas is
outside leadership. At present the Union of agricultural labour depend on their
leadership on social workers, philanthropists, political parties, voluntary
organisations and Government Agencies.

(E) Plan Schemes for Organising Rural Workers

Various studies and rural labour enquiries conducted from time to time have
revealed that the benefits of many statutory and non-statutory schemes have not
reached the workers in rural areas, primarily due to lack of their own
organisation. Realising the fact that the social gains of economic development
can be secured by rural workers only if they are properly educated and
organised, a plan scheme was formulated for appointed honorary organisers at
block level to organise the rural workers. The functions of the organisers
broadly are to educate the workers on their rights and duties and stress the value
of organisation, to help them to organise themselves into cooperatives trade
unions, or other forms of organisation, as may be considered necessary. It has
been considered necessary to make the functions of the rural organisations more
broad based.

(F) Trade Union of Agricultural Labour and the Law

Article 19(1) (c) of the Constitution guarantees the right to form association or
union which right, however, does not include the right to strike. There is no
specific provision, like Trade Unions Act, 1926, for agricultural workers.
However, the Annual Reports of the Ministry of Labour of 1978-79 and 197980 reveal that few agricultural trade unions have been registered. These unions
appear to be those which are covered under the industry under the Industrial
Dispute Act. The data collected by the Rural Labour Enquiry 1974-75 reveals
that only about one percent labourers belonging to agricultural labour
household were members of the Trade Unions. This evidently speaks of the
slow growth of trade union movement in the country.

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It is, therefore, suggested that the Trade Unions Act should be amended to
enable agricultural labour to get them registered under the Act. The Labour
Minister announced in the Parliament that the Trade Unions would be amended
to enable agricultural workers to form their own labour organisation. It may,
however, be relevant to note that the Assam Government has enacted the Assam
ShramikVahini Act, 1959 to facilitate formulation of voluntary association of
workers and registration for better and regular supply of labour for execution of
labour work. Any twenty-five or more workers in an area may constitute a
ShramikVahini. Similar legislation should be enacted in other States.

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