The unorganized sector in India plays an important role in the development of
the economy. Around 92% of India's population consists of unorganized workers.
The unorganized workers do not have enough means to provide security for
themselves. Social security for workers is important for the workers families
and for the community.
Most unorganized workers face many problems like low
wages, work hazards, etc. The Unorganized Workers Social Security Act, 2008 is
the legislation enacted by the government that provides social security benefits
to the unorganized workers. The Indian judiciary plays an important role in
protecting the rights of the unorganized sector.
There are many schemes and
policies for the unorganized workers that provides social security and many more
benefits for the welfare of the workers. This paper focuses on the problems
faced by the unorganized workers, role of judiciary for protecting the
unorganized sector and policies formulated for the protection of unorganized
In India, around 44 crore people work as unorganized workers in the unorganized
sector. The unorganized sector faces many difficulties like employment
opportunities, employer- employee relationship, low wages etc. Many unorganized
workers live in slum areas and their living condition is very poor in terms of
There are many statutes and laws for the unorganized workers, but
they are still not provided with social security benefits. Social security
provides protection for the unorganized sector. The need for social security is
a fundamental human right and it should be provided to all citizens. Social
security provided to the unorganized sector is not recognized and efforts should
be taken by the government. The Unorganized Workers Social Security Act, 2008
aims in providing a framework for welfare schemes for the unorganized sector.
Who are unorganized workers?
Under section 2(m) of the Unorganized Workers Social Security Act, 2008, the
term ‘unorganized worker' means a home-based worker or a self- employed worker
or a wage worker in the unorganized sector. It includes a worker in the
organized sector who is not covered by any of the acts pertaining to welfare
schemes as mentioned in Schedule – II of Unorganized Workers Social Security
Act, 2008. Unorganized workers take over the Indian labor market and
represent 90% of the total Indian workforce. Unorganized sector in India is one
of the largest in the post- industrial world.
Unorganized Workers are people who do not have the benefit of pension,
maternity leave, provident fund, gratuity etc. These workers work on daily and
hourly wages. The unorganized labour in India is enormous when it comes to its
number range and hence they are omnipresent in India. The unorganized sector has
to put up with cycles of excessive seasonality of employment because most of the
unorganized workers do not have secure durable avenues of employment.
Unorganized workers have no formal employer – employee relationship and their
workplace is scattered and disintegrated. Unorganized workers are subjected to
indebtedness as their income does not meet with their living needs. These
workers face exploitation, harassment, discrimination by the rest of the
Major problems faced by Unorganized Workers
In India, 90% of the workforces are engaged in unorganized sector. As being the
weaker section in the society, they deal with many problems. Even though the
unorganized sector contributes to the economy, they are faced with many
challenges. They are:
- High level of insecurities in jobs:
Unorganized workers depend on various jobs due to insecurity of work. Factors
like climate change, locations etc. affect the employment opportunities for
unorganized workers. For example, agricultural sector in India is highly
irregular and unassured. This is because of the availability of work to them.
They are engaged only for 3 months in a year and the remaining 9 months they are
either unemployed or they search for alternative jobs to sustain from
- Minimum wages
Sec 2(h) of Minimum Wages Act, 1948 defines the term ‘Wages'. It
means remuneration capable of being expressed in terms of money which would if
the terms of the contract of employment express or implied were fulfilled be
payable to a person employed in respect of his employment or of work done in
such employment and includes house rent allowance. Even though the act
defines the term, the workers are not paid minimum wages in most cases.
In Peoples' Union for Democratic Rights v. Union of India, the Supreme Court
held that even if poverty forces anyone to work for minimum wage, Article 23
prohibits employing workers for wages below the statutory minimum level as it
results in forced labour.
- Long working hours
In the Unorganized sector, long working hours are beyond the labour and
regulatory norms which is standard in India. The agricultural sector has no
fixed working hours as there are no laws that regulate the working hours for the
agricultural sector. In the other unorganized sectors, the working hours are
fixed from 12- 15 hours and their wages depend on the hours their work for their
employer. As most of the workers are illiterate and are dependent on the wages
given by the employer they are exploited by the employer as they force the
workers to work for more hours.
- Work hazards, occupational safety and living conditions
Unorganized workers are exposed to dangerous working conditions which affects
their health conditions. They face many health problems because they have low
nutrition and their excessive physical activities. Due to their low income, they
are unable to pay for their medical expenses. Workers who work in firework
factories, tobacco factories, and matchstick factories are prone to respiratory
diseases because of inhaling the tobacco dust, fire powder etc. Workers in
agricultural sector are affected by excessive use of pesticide, insecticide and
fertilizers. Unorganized workers live in slum areas and unsanitary conditions.
Basic facilities like washing areas, toilet facilities etc. are below standard.
- Women and children are unprotected
Art 39(d) of the Constitution of India talks about equal pay for equal work.
This means that all workers should be given equal wages irrespective of their
sex. Wages given to men are more than the wages given to women and children for
their equal hours of work. Many children are forced to work in households,
dhabas, and tea shops for low wages. Children work for long working hours and
they are exposed to many hazardous working conditions which affect their health.
Women are sexually harassed and assaulted in many workplaces. Women experience
many physical and mental problems and they are not aware of their rights.
Unorganized Workers Social Security Act, 2008
The Unorganized Workers Social Security Act, 2008 was passed by the Parliament
of India on December 30, 2008. This act aims to provide social security and
welfare to the unorganized sector. The Central Government and State Government
has made various schemes connected to life, disability, old age, housing,
education, employment etc. These schemes are funded by the Central and State
Government. This act is applicable to whole of India, specifically for the
unorganized sector. For the implementation of the law, the government has
constituted the National Social Security Board and the State Social Security
National Social Security Board
The National Social Security Board is constituted by the Union Government. The
chairman for labour and employment is the Union Minister. The members of the
Union Government appoint 7 people who represent workers and employers in the
unorganized sector. The board gives recommendations to the Union Government
about schemes for the unorganized workers. They advise the government on matters
that arise out of administration of the act. The board monitors schemes that
were formulated for unorganized workers.
State Social Security Board
For proper implementation of the act, the State Government has constituted
social security board in each state. The composition of the State Social
Security Board is same as the National Social Security Board. The board reviews
the registration and gives identity cards to the unorganized workers. The
board is not empowered to perform many functions. They can only review and
monitor. They are not allowed to take any decisions on their own because only
the government can decide on the recommendations made by the board.
Limitations of the Act
Apart from the establishments of national and state level boards, the act does
not refer about security provided to the unorganized workers. A separate bill
for agricultural workers and schemes for agricultural workers are not brought up
by the act. This act is applicable only for a small section of unorganized
sector. There is no mention of any provision that talks about punishing any
employer who violates the act and bureaucrats who does not register any
unorganized worker under the schemes.
Role of Judiciary for the protection of Unorganized Sector
When there is a failure of proper implementation of legislations, the judiciary
protects the rights of unorganized workers. Apart from legislations, the
Constitution of India grants fundamental rights to the unorganized workers. Any
person who works but not paid minimum wages for the work he does, then it
violates Art 21 of the Constitution of India. Article 21 states that the
bonded labour should be recognized by the government. Every State Government
has to provide basic human dignity to bonded labour.
In Sanjit Roy V. State of Rajasthan
, the court held that whenever any
person who works for the state is affected by drought or scarcity, the state
shall not pay him minimum wages as it violates Art 23 of the Constitution of
India. Any labour work done by prisoners and if they are not paid minimum wages,
it means it is forced labour and it infringes Art 23 of the Constitution.
In Daily Rated Casual Labour v. Union of India
, the court held that
if the workers are classified into regular and working employees, then it leads
to infringement of Art 14 and 16 of the Constitution. No person can refuse to
render services to any worker on the ground that they belong to scheduled
caste. The judiciary should protect the rights of unorganized sector and
should implement social security welfare schemes for the benefit of the
Policies for Unorganized Workers
Social security is necessary for the welfare of unorganized workers. There was
no specific legislation on social security for unorganized workers. The
unorganized workers are covered under various policies formulated by the
National Policy on Skill Development
The National Policy on Skill Development empowers individuals to improve skills,
knowledge, nationally and internationally recognize qualifications to gain
better job opportunities. The aim of this policy is to enhance individual's
employability and ability to adapt to changing technologies.
It aims to improve productivity and standard of living for workers. The
objective of the policy is to create opportunities to workers including women
and youth who are skilled in the work they do. It also aims to develop a high
quality workforce related to current and emerging market needs. It helps to
attract investment in skill development and strengthen competitiveness in the
National Policy on Safety, Health and Environment at Work Place
Safety and health of the unorganized workers have a positive impact on
productivity, economic and social development. The goals of this policy is to
improve safety, health and environment at workplaces.
The objectives are to reduce work related accidents, harmful diseases and cover
the financial requirements for the people affected. It also aims in spreading
awareness about safety, health and environment related issues. It establishes
suitable schemes for unorganized workers regarding subsidies. It enforces all
rules and regulations regarding safety, health and environment at workplace. It
ensures that all the workers and employers have rights and responsibilities in
achieving safe and healthy working conditions.
National Policy on HIV AIDS
National Policy on HIV AIDS is necessary to provide guidelines to unorganized
workers about the HIV AIDS infection. To fight against HIV AIDS, stigma and
discrimination is an important challenge. Due to lack of understanding, most
employers from both public and private sector have not taken up workplace
In the next 10- 12 years, India's growth will create around 10 million jobs and
most workers will be young workers. If there is a spread of HIV AIDS, then it
would affect the economic growth of the country. In order to prevent this,
workplace policies should have appropriate services and provide information
regarding the same. The aim of this policy is to prevent the transmission of HIV
AIDS amongst the workers. It also aims to provide access to treatment and
protects the rights of the affected workers.
National Child Labour Policy
On 14th August 1987, the National Child Labour Policy was approved by the
cabinet. The main objective of this policy was to eliminate child labour in
hazardous working sectors. In this scheme, the target group was for children
aged below 14 years and who worked in places where children were affected with
The policy aims to launch for the welfare of children who are working in areas
where there is high concentration of child labour. The policy focuses on
rehabilitation of children who work in hazardous working areas. Activities like
formal, non- formal education, raising public awareness by conducting campaigns
and rallies are etc. conducted by the government to eliminate child labour.
Unorganized workers in India face many problems like low wages, cruel treatment
by employers, poor living condition, etc. Social security is one of the
important subject that should be recognized by the government to reduce poverty
in the country. Apart from the Unorganized Workers Social Security Act, 2008,
there are many schemes like old age scheme, life insurance scheme, health
insurance scheme, etc. for the welfare of unorganized workers.
The rights of the unorganized workers are protected by various articles in the
constitution of India. The unorganized workers should be given awareness
regarding their health, living, and wages and should not be exploited by the
employers in their working areas.
- Sec 2(m) of Unorganized Workers Social Security Act, 2008
- Sec 2(h) of Minimum Wages Act, 1948
- AIR 1982 SC 1473
- Tiwari R.S., „Informal Sector Workers: Problems and Prospects?, Anmol
Publisher, New Delhi, 2005, p.5
- Art 39(d) of Constitution of India'
- Chapter III, Sec 5 of Unorganized Workers Social Security Act, 2008
- Chapter IV, Sec 6 of Unorganized Workers Social Security Act, 2008
- People Union for Democratic Rights v. Union of India (1982 AIR 1473)
- Art 21 of the Constitution of India
- 1983 AIR 328, 1983 SCR (2) 27
- Shabnam v. Union Of India
- 1987 AIR 2342, 1988 SCR (1) 598
- The State vs Banwari Nandu Jat And Anr (1957 CriLJ 539)