Legal battles being waged in the corporate world for haircuts and for bringing down the non-performing assets (NPAs) effectively conceal the ground realities of thousands of smaller bad loans that are threatening to run into amounts ranging from a few crore to Rs500 crore. These NPAs are being generated by the loss of wages being suffered by millions of unskilled and semi-skilled labourers, rendered completely defenceless, with nothing to fall back upon. The smallest of organised protest by these vulnerable sections can easily land them in jail.
I have not come across a single case of violence by unpaid workers erupting from NPA impacted factories and companies in the last few years. This is so mostly because by the time, it dawns on them that wages for the past three or six or nine months have vanished, they are too tired to utter a squeak.
And I have visited factories all over India, where very often the percentage of unskilled labour who have not been paid is usually 50% or more. And their combined monthly wages would be less than the EMI on the luxury cars in the same company's name used by the promoters.
But first, some background.
Why do we make the "unskilled" labourers in India carry headloads or squat and sweep or clean all their lives?
Two of the commonest answers to this question that I have found over the decades are as follows:
1) If we provide them with wheelbarrows and long-handled brooms, they will get a sense of self-importance and will start asking questions.
2) We have to keep reminding them who the boss is and this is the best way to ensure that they remain meek and subservient.
These answers lead us to another question of a more fundamental nature:
Why do we refer to this workforce as "unskilled labour"?
This discussion highlights the total absence of dignity of labour in India. Most of the unskilled labour that I have met can, apart from turning barren land into prime agricultural, also have the capabilities to do technical work learnt on the job. And what they don't know, they look up on their smartphones, and figure out for themselves.
At a dud factory, lying in shambles, I got a dozen "unskilled" labourers to use the basics of tallying cargo and stores learnt on ships, and their smartphones next, to provide me with a very accurate list of assets by evening, which was later assembled and put into an Excel sheet and then converted into a pdf file by one of the younger so-called ‘unskilled’ worker. I also got them to generate a list of the cleaning equipment required, backed up with photographs and notes on what to do to clean up and to order an acid to get the toilets functional again. All this, , including delivery the next day of cleaning equipment bought online, as well as ready to heat and eat food, for less cash than a single night’s charges for a 5-star hotel room!
As junior deck cadets on TS RAJENDRA, each of us was given a long handled broom, which remained our constant companion: we even slept with them by our bedside and became emotionally attached to it: till the time we became senior cadets a year later and were allowed to throw these brooms overboard. But before doing so, each of us received from the senior cadet a painful whack on our tender butts with the handle of the broom.
This act was called ‘Charlies’. By then we had learned multiple uses of this broom and had become very skilled indeed.
Working our way up thereafter, many of us received senior most positions to command huge foreign-going, ocean crossing merchant ships within about 10 years from the date we first bent as 16-18 year olds and got a ’Charlie’ as unskilled junior cadets.
During my visits to manufacturing units counting their last days, I have noticed that the human beings, who get the rawest deal in terms of payment of wages and treatment, are the so-called ‘unskilled labour’, who actually form the backbone of the industrial world in India. But they remain designated "unskilled" all their lives, and are seldom, if ever, considered eligible to reap the benefits of a wheeled aid, such as a wheel-barrow or the long handled broom.
The bosses seem mortally afraid that this workforce will start thinking and asking questions. Worse, they will ‘look up’ and meet the bosses ‘eye to eye’.
Coming back to companies and NPAs, wages payable to workers typically start slowing down six months or so before a factory goes bottom up. The Insolvency and Bankruptcy Code (IBC) process is now fairly predictable, and the day it starts, the promoters throw up their hands and decline all responsibility for debts, old or new. The earliest that one can expect resolution is 180 days, likely 270 and often more.
Here is what happens to the workers.
a) They have already been weakened by months of delayed or no payments. This often includes borrowing loans and remain in debt to the local goons who in turn are hand in glove with the factory promoters.
b) The money lying in the provident fund (PF) now becomes unreachable. The standard response from Employees' Provident Fund Organisation (EPFO) is that they have a claim on the promoters and therefore till that is resolved, along with other legal issues, the workers’ PF and other dues is in limbo.
c) The Employees' State Insurance Scheme (ESIS) also becomes invalid. Any smart card presented provides details of payments and contributions not having been received.
d) Obviously, the wages and benefits are not reaching their hands or bank accounts. Where the bank account had been linked to the promoter's bank, there is more problem with the fine print, especially if it is a private bank.
e) Hanging around outside the factory, signing a daily register and then doing nothing, fetches them no income. It does, however, expose them to all sorts of accusations of theft or pilferage. More problems!
f) The smarter ones simply abandon all hope and move on. The not so smart ones eventually do the same. The remainder, which in my experience after 180 days would count to about 10%, are by now in debt to the loan sharks. I do not know what happens to them, they probably end up selling kidneys, and I say this seriously.
The statistics meanwhile will show that:
a) The number of EPFO accounts and bank accounts have gone up. I have seen unskilled workers with different bank accounts for every company they have worked at and each reduced to zero by all sorts of charges.
b) The resolution and liquidation process places employee wages on top priorities. But only as long as the employees file their claims. How are they to do this if the registered office and the Justice Delivery System proceedings are in some other part of the country?
c) The NPA was resolved with minimal haircuts.
What are the solutions?
The simplest solution is that outstanding of wages should never exceed a week. Pay every weekend, and in case of default, the employee has the option of leaving before the amount rises hugely, and EPFO and ESI should come into the loop, and provide cover till resolution or solution, insolvency, bankruptcy, revival or whatever. This, of course, works if the worker has the confidence to get another decent employment.
A slightly more complex solution has to do with paying workers who have completed six months or more, in advance for the month to be worked, that is - pay them between the 7th and 15th of the month for the full month.
I know people who do this, and apart from the warm fuzzy goodwill it generates, it also takes care of a significant issue - if a worker has to run away with unearned wages, then so be it, the logic is that the factory owner or promoter has got the closure he wants at a low cost.
The third solution has to do with the justice delivery system-pushed resolution process itself. Using the huge funds and resources at their disposal, and recognising that EPFO as well as ESI are already claimants under the process, the overdue payments for unskilled and semi-skilled workers at the bare minimum and for other employees too, should be brought up-to-date and their payouts or at least 75% of payouts made automatically within a month. This money can always be recovered in due course as it is already the first in the list.
Let people in the justice delivery system of India have their salaries and allowances delayed for a month to see how it feels. Their lofty castles and palaces dispensing ‘justice’ were also built by the same unskilled workers, right?
(
Veeresh Malik is an activist from Delhi, who continues to explore several things in life.)
