Golden rule

Investors have long wanted the labour law to become ‘more flexible’, meaning, among other things, giving them greater powers to hire and fire workers. But workers and their trade unions have always been in favour of job security and clear and favourable service terms. During the decade-long insurgency and the two years of political transition, Maoist-affiliated trade unions have pushed for better terms and conditions for workers through various measures, including strikes and intimidation. This caused open disputes between labour and management, and in most of them the two sides also finally worked out compromises. Now, the CPN-Maoist, as the single-largest political party in the Constituent Assembly, is poised to lead the next government. Businessmen have been wary of the policy that the Maoists might take in economic and industrial fields. Labour policy is one such widely debated area.

In an interaction held in the capital on Monday with entrepreneurs in three export-based industries, Maoist politburo member Dr Baburam Bhattarai said the industrial units closed down following labour-management disputes would soon be opened again. Investors in the garment, carpet and pashmina industries called for a new labour law aimed at boosting these industries and protecting the interests of both employers and workers. The main thing is that labour and management should not be viewed as adversarial, but as two sides complementing each other to achieve common goals, maximising their mutual interests, in the process also serving society. Adversarial thinking lies at the root of mutual mistrust and never-ending industrial disputes, each side trying to put the other side at a disadvantage. This negative attitude helps none - employers, workers, society and economic growth. And ‘economic revolution’ is being stressed as the next revolution.

Industrialists have a point when they point out that in certain respects the existing labour law is too rigid. And rigid labour law also stands in the way of foreign investment, because foreigners do not want to become involved too much in labour disputes and court hassles. The intention behind prescribing job confirmation when workers have completed a certain period of service has been to ensure that they are not exploited. But employers face certain genuine problems, too — for instance, when seasonal or other temporary factors drive up demand, they have to hire temporary workers. But if they are compelled to

retain them even after the additional demand is gone, they will find it financially difficult to sustain this. On the other hand, if blanket hire-and-fire authority is given, it will be liable to gross abuses. Therefore, the new labour policy should be fair and practical, aimed at maximising investment and labour productivity, as well as contributing to amicable industrial relations. The same approach should be taken to questions of bonus, yearly increment and other perks. The provisions of law should be clear and unambiguous. Before introducing a new policy or law, all contentious issues need to be sorted out. In this regard, the idea of a tripartite commission of employers, workers and the government is a sound one.