Kerala protests contract labour

Kerala protests contract labour
Sixteen trade unions are on strike in the southern Indian state of Kerala. Employees are protesting the government’s intention to amend the Industrial Establishment..

Sixteen trade unions are on strike in the southern Indian state of Kerala. Employees are protesting the government’s intention to amend the Industrial Establishment (Standing Order) to allow fixed term employment. Fixed term employment would severely threaten the job security of numerous workers, particularly as India does not have universal social security.


On March 21st, the Indian labour ministry issued a notification amending the Industrial Establishment (Standing Order) of 1946. This order had been amended in 2016 to allow fixed term employment in the apparel manufacturing sector. The notification issued earlier this month stated that the phrase “fixed term employment in apparel manufacturing sector” would be replaced by the broader phrase “fixed term employment”. This would allow contractual employment across all sectors.

Fixed-term employment is a form of contractual labour. Contractual labour is thought to improve the ease of doing business. Proponents argue that it will allow organisations to hire seasonal workers. However, fixed term employment also allows “hire-and-fire” policies. According to these rules, companies would be allowed to terminate workers without notice, and without a notice-period salary. Groups that oppose this move have noted that contracts can be terminated by non-renewal. Fixed-term employment would not change the worker benefits received.

In 2003, the NDA government led by Vajpayee had introduced a similar measure to allow fixed-term workers. The move was cancelled by the UPA government in 2007 after protests from labour organisations.

Social security

Social security is a program of public provision for the economic security and social welfare of individuals and their families. Social security is intended to both protect citizens against a fall in living standards and promote better living conditions to help overcome deprivation. A number of countries across the world have robust social security programmes. In the United States, the Social Security Act signed in 1935, gave social security benefits to retired or disabled citizens and their families.

India has some benefit schemes that address poverty and promote welfare. However, the country falls short on “protective” measures, particularly for the working poor. India does not have a formal, universal social security system. According to the Hindu, it spends only 1.4% of its GDP on social protection.


Trade unions in the southern Indian state of Kerala are currently on strike. The call for the strike began earlier this month, when the central government expanded fixed term employment across multiple sectors.

At the time, CITU state general secretary Elamaram Karim told the Hindu that the action was “blatant, unilateral, and arrogant.”  “Institutionalising contract labour is an atrocious step by the Modi government to appease the corporate employers,” Karim stated. “This will turn the industrial labour into slave workers and take away the collective bargaining power of the trade unions.”

16 trade unions joined in the strike, led by the Centre of Indian Trade Unions (CITU). Union leaders noted that the proposed amendment had not been examined by the Parliament or the Parliamentary Standing Committee on Labour. They argued that the new legislation would be detrimental to workers job safety and rights. “The amendment will enable employers to adopt a policy of hire and fire,” said CITU Kerala leader Anathalavattom Anandan said.

CITU, Indian National Trade Union Congress (INTUC), All India Trade Union Congress (AITUC), Swatantra Thozhilali Union (STU), Hind Mazdoor Sabha (HMS) and United Trade Union Congress (UTUC) were some of the major unions involved. The Bharatiya Mazdoor Sangh (BMS), the labour wing of the BJP, did not participate.  

According to the news agency Manorama, only 10% of staff (300 individuals) were in attendance at the state secretariat. The Kerala State Road Transport Corporation (KSTC) stopped its services, and most public transport was at a standstill, including bus services. Employees from state owned banks and other services such as BSNL took part in the strike as well. Media noted that taxis, autos, and a large majority of businesses were closed.


Our assessment is that the key problem of this amendment is its inability to factor in social security. Most employees are outside the social security bracket and therefore face job insecurity. These workers find continuity of employment and the provision of pension to be of utmost importance. Prior to enacting “hire-and-fire” legislation, the state must ensure some form of social security. Automation is already threatening a huge proportion of Indian jobs. The government must therefore also focus on reskilling employees so that their skill sets aren’t redundant. We believe that the country is not a private limited and doesn’t function on bottom line; it must have heart and soul for its citizens.