People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 27

July 07, 2013


Shift of Policy Needed for Job-Rich Growth: ILO





THE 102nd session of ILO was held in Geneva from June 5 – 20, 2013. 4718 delegates from the member countries participated. India had a 27 member delegation comprising nine members each from the workers’, employers’ and government representatives. Representatives from BMS, INTUC, AITUC, HMS, CITU, AIUTUC and UTUC comprised the workers’ contingent of the delegation. Hemalata, secretary, CITU represented the organisation. The minister for labour and employment who usually leads the delegation had to skip the conference this time probably because of the impending changes in the cabinet.


The director general’s report was titled ‘Towards the ILO centenary: Reality, renewal and tripartite commitment’ to prepare for the observation of the centenary of the formation of ILO in 2019. The prolonged global economic crisis that continues to haunt the world is reflected in the report.




The report points out that 4.45 crores workers per year, ie, more than 22.2 crore people all over the world, will enter the labour market in the next five years in search of new jobs. Around 20 crore workers are now out of work. ‘It requires a shift of policy mixes and production patterns towards job rich growth’. It also warns about the declining prospects of job creation on the scale that is required. ‘Robotics is making a major breakthrough in manufacturing with 2 lakhs industrial robots coming into use each year and a total of 15 lakhs expected by 2015. The implication is that manufacturing can be a major contributor to gross domestic product and productivity but with a more modest share in job creation. Robotics and automation will most probably accelerate the ongoing decline of manufacturing employment worldwide and seem likely to penetrate other sectors too, including transport, hospitals and the caring profession’ the report says.




Quoting this year’s annual survey on global risks of the World Economic Forum, which categorised ‘severe income disparity’ as the highest likely risk, the director general’s report expressed concern at the widening inequality within and between countries. According to the report ‘…Concentration of very high incomes for very few people at one end of the scale, and low incomes for large numbers at the other, has weakened global demand and the poverty reducing effect of growth. Importantly, wider inequalities have gone hand in hand with a growing disconnect between incomes and productivity, which has distorted economic incentives’. At the global level, as per the report, 70 percent of households can be categorised as poor, 28 percent as middle class and 2 percent as rich.


We have seen inequality widen under neoliberal globalisation in our country where the net worth of the 100 richest Indians was around Rs 12 lakh crore in 2011 – more than the size of the annual budget of the country while the poorest 10 percent of the rural population survive with less than Rs 15 per day and the poorest 10 percent of urban population with Rs 20 per day.


Referring to the ILO’s concept that unacceptable levels of inequality, like absolute deprivation and hardship can pose a threat to social stability and cohesion, the director general sought a major role for ILO in addressing this issue in the coming years.


The report admits that work no longer works to lift oneself out of poverty as often ‘work fails to generate income above poverty levels’. It expresses concern at the increasing numbers of working poor. The World of Work Report, 2013, shows that ‘many of those who succeed in getting out of poverty remain in near poverty circumstances or in danger of falling back into their previous conditions’


In the wake of the attempts of companies and countries to improve their competitiveness, particularly in their efforts to overcome the impact of the global economic crisis, the ILO director general’s report argues that ‘it is logically impossible for all to become more competitive: greater competitiveness for one by definition means lesser competitiveness for another. By the same token, not all countries can export their way out of crisis, because one’s export is another’s import.’  It seems to wonder why countries were failing to ‘grasp and act on that simple logic’ and risk ‘setting off a competitive downward spiral in pay and conditions against which the ILO has warned, for example in the 2009 Global Jobs Pact, and which can benefit no player in the long term’.




The report observes that in the background of the huge differences in the international wages, the notion that competitiveness can be enhanced by reducing wage costs, is not valid. The more pertinent question is to examine the relationship between wages and productivity. And in this regard all the available evidence shows that wages were lagging behind productivity in both the developed as well as the developing countries; the share of wages in national income has come down. The average labour share in 16 developed countries fell from about 75 percent in the mid-1970s to about 65 percent just before the global financial crisis hit. In the case of 16 developing and emerging nations, the corresponding reduction from the early 1990s up until the crisis was from 62 percent to 58 percent. In India, we have noted that the share of wages fell from 30 percent in the late 80s to below 20 percent in the 90s to 9.4 percent in 2010, of the net value added.


Full time permanent jobs with fixed hours, defined benefit pension on the completion of a largely predictable and secure career path with a single employer are becoming rare globally, as per the report. Today, about half of the global workforce work for more than one employer. Work, which the ILO calls ‘atypical’, or ‘non standard form’ where workers do not have any job security, income security or social security, has become predominant; the ‘standard’ has become the exception. This is one of the methods through which wage costs are brought down by the employers.


The director general’s report candidly admits that ‘it has been difficult to find consensus on these issues in the ILO although considerable effort has been invested in trying to do so’. The ILO has adopted many Conventions and Recommendations on several issues like part time, home based work, on employment relations etc. But, as the report says, these conventions and recommendations have received ‘only modest levels of ratification. …. and strong controversy continues over the issues they address… The defence of legitimate interests in these matters as in others, and the divergent views resulting from it are a normal part of the life of the ILO. But, the report warns, ‘if they result in a long term stand off on matters which must and will be the subject of political decisions and action at the national level, there is a risk that the ILO will inevitably be seen as irrelevant in areas where it absolutely must be present.’


The facts and figures that are presented in the ILO director general’s report mirror the increasing attacks on the lives and livelihoods of the workers by the employers under neoliberal globalisation and more in the context of the global economic crisis. The governments today are increasingly formulating policies and intervening in workers’ struggles to protect the interests of the big national and multinational corporations.




However, the International Labour Organisation (ILO), as is well known, is not an organisation of labour as the name suggests. It is a tripartite forum comprising the employers’, the workers’ and government representatives and was established as an agency of the League of Nations following the Treaty of Versailles which ended the World War I. It has to be noted that this was a period when the victory of the Great October Revolution and establishment of socialism in Russia in 1917 had created great interest and enthusiasm among the workers all over the world. It was necessary for the capitalist class to prevent the working class from getting attracted towards socialism.


In this background, the Preamble of the ILO constitution had to acknowledge that ‘…universal and lasting peace can be established only if it is based upon social justice; And whereas conditions of labour exist involving such injustice, hardship and privation to large numbers of people as to produce unrest so great that peace and harmony of the world are imperilled; and an improvement of those conditions is urgently required;…’ The preamble gives examples of how this can be done ‘by regulation of the hours of work, including the establishment of a maximum working day and week, the regulation of the labour supply, the prevention of unemployment, the provision of an adequate living wage, the protection of the worker against sickness, disease and injury arising out of his employment, the protection of children, young persons and women, provision for old age and injury, protection of the interests of workers when employed in countries other than their own, recognition of the principle of equal remuneration for work of equal value, recognition of the principle of freedom of association, the organisation of vocational and technical education and other measures’.


Since its formation, the ILO has adopted many Conventions and Recommendations, after elaborate discussions in its conferences where all its three constituents, the workers, employers and governments participate, on all these issues. But as the director general’s report noted very few Conventions and Recommendations have been ratified by the governments. And still fewer, if at all, are implemented. The most important conventions like the one on the right to organisation and collective bargaining, equal wage, etc are freely flouted by the employers with the connivance of most of the governments globally.


But, given the composition of the ILO, despite presenting the facts that show increasing attacks on the workers under neoliberal globalisation, the language in which these facts are presented seeks to blunt the disastrous consequences of its impact. Solutions are sought and recommendations made on the assumption that there is no basic contradiction between the interests of the employers and the workers, and whatever differences exist can be resolved through negotiations and within the existing system – through ‘social dialogue’. The blatant refusal of the employers to enter into any type of talks with the workers’ or their unions, the increasing use of the State administration to attack and intimidate workers and their organisations, the increasing interventions of the governments including at the policy making level in favour of th employers etc, which the workers experience in their daily lives do not find mention in the reports. In 2008 it has even adopted a ‘Declaration on Social Justice for a Fair Globalisation’.


Guy Rider, a former general secretary of ITUC who was elected as director general of ILO last year, sought a mandate from the conference to reform the ILO to make it more relevant and effective and take it closer to its constituents. The role of IMF in imposing conditions related to work and workers, a sphere in which it was not competent, was criticised and the ILO seeks to involve itself in such issues. It was also suggested that like the G 20, E 20 and L 20 meetings should also be held involving the employers and workers.


The director general also wanted ILO to directly engage with the multinational corporations. The recent intervention of the ILO in the case of the worst industrial accident in history due to the collapse of a building housing several garment factories in Bangladesh that led to the death of more than 1100 garment workers, most of them women was highlighted as an achievement for the ILO. Soon after the accident, the director general of ILO went to Bangladesh and brokered an agreement between two GUFs (Global Union Federations), UNI and IndustriALL and some of the international brand owners who buy from the Bangladesh garment manufacturers. This model of agreements between GUFs and multinational corporations was sought to be promoted by the ILO with the full support of the European Union and the governments of the developed countries. Several trade unions and the WFTU criticised the agreement as it does not hold the international brands for which the goods are produced as responsible for the conditions of the workers. The agreement provides only for limited inspection and a meagre financial commitment from these big corporates to meet the expenses of the safety inspector’s office to be created as per the agreement. 


In the 102nd session, the ILO has selected eight areas in its effort ‘to embark on its second century with an explicit commitment to the most vulnerable in the world of work’. These include formalisation of the informal economy, decent work in the rural economy, protection of workers from unacceptable forms of work, and creating and extending social protection floors. It is interesting that when more and more workers were being employed under informal and non standard forms of work including in the developed countries under neoliberal globalisation, the idea of ‘formalisation of informal economy’ was supported by all the advanced capitalist countries including those in the European Union, the USA etc.


All the draft resolutions on the items in the agenda were unanimously adopted by the conference. Even in the case of ‘social dialogue’ which was being increasingly flouted globally, there was total consensus on its necessity. However, the experience of the working class whether it is in relation to the various ILO conventions, recommendations and resolutions that are unanimously adopted or to the national laws of their own countries is that, these remain only on paper so long as the governments are not compelled to implement them through strong struggles by the working class.


Our experience in India too is the same. The demand to ratify the ILO conventions 87 and 98 related to the right to organisation and collective bargaining, in addition to the demands for minimum wages, universal social security, equal wages for contract workers etc have been repeatedly raised by the joint trade union movement during the last four years including in the historic two days general strike on February 20 – 21 this year. But, the government of India, which boasts of being the founder member of the ILO, has not taken any effective measures to meet these demands. Thus it becomes necessary for the working class to intensify its efforts to further strengthen its unity and take the joint struggle to new heights to force the government to implement these fundamental demands of the workers, which have also been supported in international tripartite platforms like the ILO.