A Project Of

Labour Law On

UNORGANISED WORKERS' SOCIAL SECURITY

ACT, 2008
Submitted to:
Mrs. Balwinder Kaur

Submitted by:
Ankita Agrawal
B.A.LL.B.(Hons.)

Semester V, Section A
Roll No. 29

Submitted on:
24th August 2015

HIDAYATULLAH NATIONAL LAW UNIVERSITY, RAIPUR

DECLARATION

I hereby declare that the project work entitled Unorganised Workers' Social Security Act, 2008
submitted to HNLU, Raipur, is record of an original work done by me under the able guidance of
Mrs. Balwinder Kaur, Faculty (Labour Law), HNLU, Raipur.

ANKITA AGRAWAL
ROLL NO. 29
SEM-V

ACKNOWLEDGEMENTS
2

With a deep sense of gratitude, I acknowledge the help of all those people who have made the
completion of this project possible. I would like to thank my teacher Mrs. Balwinder Kaur for
her help and guidance and also for putting her faith on me by giving me such a topic to work on.
Mam, thanks for the opportunity which helped me grow.
My gratitude also goes out to the staff and administration of HNLU for the infrastructure in the
form of our library and IT Lab that was a source of great help for the completion of this project.
Last but not least, I would like to thank my family and all my friends who helped me do this
project by sharing their ideas when we discussed together.

Ankita Agrawal
Semester V
Section A
Roll No. 29

CONTENTS
3

DECLARATION
ACKNOWLEDGEMENTS
1. INTRODUCTION.......5
1.1. A CONTEXTUAL OUTLINE5
1.2. OBJECTIVES OF THE STUDY6
1.3. METHODOLOGY AND DATABASE..6
1.4. ORGANISATION OF THE STUDY.6
2. PURPOSE OF THE ACT ..........7
3. AN OVERVIEW OF THE ACT ..7
4. KEY FEATURES OF THE ACT ...10
5. MAJOR LIMITATIONS OF THE ACT ....12
6. IMPLEMENTATION ISSUES: THE FAILURE FRONT....15
7. PROPOSED AMENDMENTS IN THE ACT.16
8. CONCLUSION..21
9. REFERENCES..22

[1] INTRODUCTION
[1.1] A CONTEXTUAL OUTLINE
Profit in a business is perceived to be directly proportional to the extent of exploitation of labour.
Labour is classified into different segments as unorganised and organised, wage earners and selfemployed, skilled, semi-skilled and unskilled and so on, depending upon the nature, period, and
place of work. Stunningly, the labour laws of the country only covered workers of organised
sector, who form only 8 % of the total labour force. Informal sector or unorganised sector in
India is broadly characterized as consisting of units engaged in the production of goods and
services with the primary objectives of generating employment and incomes to the persons
concern. In India, almost 92% of the labour comes under unorganised sector. Dearth of
regulations and absence of Legislation purports the connivance of the government towards
barbarous and roughshod (of course even Inhuman, at times) treatment of these labourers by the
employees. They are not provided with any security against working conditions including safety,
maximum hour of work and job security.
4

To protect the rights of this segment of workers, the first of its type; Unorganized Workers
Social Security Act, 2008 was passed by the parliament. The preamble of the Act reads as: An
Act to provide for the social security and welfare of unorganised workers and for other matters
connected therewith or incidental thereto.
Unorganized Workers Social Security Act, 2008 is the beginning in the direction of protecting
the rights of unorganised workers in India but numerous implementation issues, inherent in the
very structure of the Act, barricades in its well functioning. Being among ratifying countries of
UDHR and International Covenant on Civil and Political Rights, the social security of
unorganised workers should be considered as their basic human right in India and the country
must adhere to protect such rights.
The Act is claimed to cover six crore unorganized workers, and in turn their family members of
30 crore people.6 The expectations are high but the objective still seems to be far-flung. This
paper analyses the provisions of the Act and also proposes amendments, wherever it is felt
necessary.

[1.2] OBJECTIVES

OF THE STUDY

To understand the nature and purpose of the Unorganised Workers' Social Security Act,
2008.
To study the different provisions of the Act.
To focus on the major limitations of the Act.
To suggest certain amendments in the Act to make it more relevant and meaningful.

[1.3] METHODOLOGY

AND

DATABASE

The present study is a doctrinal and descriptive study based on the critical review of both
primary & secondary sources. Secondary & Electronic resources have been largely used to
gather information & data about the topic. Books & other references have been primarily helpful
in giving this project a firm structure. Websites, dictionaries & articles have also been referred.
Footnotes have been provided wherever needed, to acknowledge the sources.

[1.4] ORGANISATION

OF THE STUDY

The project is divided into 6 major sections. They are:

1. Purpose of the Act: This section explains the purpose and object of enacting the
Unorganised Workers' Social Security Act, 2008.
2. An overview of the act: This section deals with the different provisions of the Act.
3. Key Features of the Act: this sections deals with the framework for Social Security
Schemes, Creation of State and National Social Security Advisory Boards, and
Registration and Smart Cards for Unorganised Sector Workers.
4. Major limitations of the act: This section highlights the major loopholes in the Act.
5. Implementation issues - the failure front: This sections deals with the problems in the
implementation of the Act in particular.
6. Proposed Amendments in the Act: This section deals with the amendments proposed by
the National Convention on Social Security for Unorganised Workers in the Act.
7. Conclusion: This section concludes the project work.
8. References: This section underlines the different references used to complete this project.

[2] PURPOSE OF THE ACT

The Unorganised Workers' Social Security Act 2008 of the Parliament of India is enacted to
provide for the social security and welfare of the unorganised workers (meaning home-based
workers, self-employed workers or daily-wage workers) and for other matters connected
therewith or incidental thereto.1

[3] AN OVERVIEW OF THE ACT

An Act of 33 of the year 2008 was enacted by the Parliament of India with the short title as the
Unorganised Sector Workers Social Security Act, 2008. This Central Government Act is
provided with the purpose and object of providing social security and welfare of the unorganized
workers. The legislation was assented by the President of India on 30th day of December 2008
and the provisions of this Act were extended to the whole of Indian territories.
The provisions of the Act are divided into six chapters containing several provisions, and the first
Chapter therein makes preliminary provisions including short titling, extension and
commencement of the Act. And also the same Chapter also provides for certain important
1 Unorganized Workers Social Security Act, 2008.
6

definitions of various terms used under the provisions of the Act, including the one important
term Unorganised worker 2 which is being used under the long title also, which here means a
worker working home based, as self employed or wage worker in the unorganized sector and
also the term including the workers from the organised sector, who are taken away from being
covered under the provisions of any of the enactments enumerated under the Second Schedule
annexed to this Act.
The Chapter II of the Act makes provisions for social security benefits which can be seen as the
main purpose of the Act. Section 3 of the Act provides for making of welfare scheme by the
Central Government for the unorganized worker which should deal with the matters provided
under the several clauses of this provision, such as covering life and disability, matter of
providing benefits such as maternity and health benefits, old age protection and all other benefit
so determined by the Central Government and all other matter provided over there. Under the
same chapter, the provisions of section 4 of the Act provides for issuing funds by the Central
Government for the Scheme which is being notified by it under the previous provision. Entire
funding is required to be made by the Central Government or in case of partly funding by the
State Government then remaining part to be funded by the Central Government or even in case it
is partly funded through collected contributions from the beneficiaries of the Scheme or
employers thereof then remaining part to be funded by the State and also by the Central
Government.3 The Central Government is also required to notify the scheme and while doing so,
under the same notification, the Central Government is required to necessarily provide for
matters significant for proper and efficient implementation of the said Scheme. And certain
matters regarding such implementation are given as includes, scope of the Scheme, beneficiaries
and resources thereof, implementing agency(s) and also for relevant matter including grievances
redressal.
The next Chapter being third one, dealing with the provisions for constitution of Board for the
unrecognised workers. The chapter contains only one section i.e. Section 5 of the Act, making
provisions as to constitution of the aforesaid Board. The Central Government is empowered to
2 Section 2(m), Unorganized Workers Social Security Act, 2008.
3 Section 4, Unorganized Workers Social Security Act, 2008.
7

constitute such Board with the name and title as National Social Security Board by notifying
the same.4 Such Board is required to deal with the powers and functions provided under this Act. 5
So far as the composition of the said Board is concerned, the Union Minister for Labour and
Employment should be the Chairperson, ex officio, the Director General (Labour Welfare)
should be Member-Secretary, ex officio and besides both of them there should be other 34
Members being nominated by the Central Government from respective provided sectors. 6 All
such members including Chairperson must be from the persons having eminence in the labour
welfare, management, etc. fields of labour.7 And the Board is empowered to provide for matters
like number of nominated Members, their term of office, other conditions as to their services, etc.
Such Boards term is given as of 3 years8 and for its meetings the Board is required to meet at
least 3 times in the year at the prescribed place.9 As to allowances of the Members for attending
meetings also the Board can fix the same. And the said section 5 itself provides for several
functions of the Board including making of recommendations to the Central Government for
framing suitable schemes for different sections of unorganised workers and also other provided
functions.10
Further, the Act makes provisions for constitution of similar security Board for the States, as per
its Chapter IV, where in section 6 of the Act empowers the State Government of every State to
constitute such Boards with the name and title as for say, Maharashtra State Social Security
Board. For composition, the Minister of Labour and Employment of the concerned State will be
4 Section 5(1), Unorganized Workers Social Security Act, 2008.
5 Ibid.
6 Section 5(2), Unorganized Workers Social Security Act, 2008.
7 Section 5(3), Unorganized Workers Social Security Act, 2008.
8 Section 5(5), Unorganized Workers Social Security Act, 2008.
9 Section 5(6), Unorganized Workers Social Security Act, 2008.
10 Section 5(8), Unorganized Workers Social Security Act, 2008.
8

Chairperson, ex officio, the Principal Secretary or Secretary (Labour) will be Member-Secretary,

ex officio; and other 28 members whose nomination to be made by the State Government from
different sectors.11 Other provisions under the said section provides for more or less similar
issues as are involve in case of the National Board as aforesaid. Moreover, the State Government
issued scheme for such unorganised worker, is required to be funded in the manner as aforesaid
in case of the Central Governments Scheme, only funding from the Central Government is not
required in this case, however, the States can seek financial assistance from the Centre, in respect
thereto.12 Moreover, the Act requires to keep the records under this Act by the District
Administration.13 Also, the State Governments are required to setup the Workers facilitation
centres for informing workers about the social security schemes available for unorganised
workers, assisting them to have registered with District Administration and facilitating their
enrolments in the Schemes.14
The Next chapter of the Act dealing with the provisions effecting registration of the unorganised
worker, wherein section 10, provides for eligibility conditions for such registration. The
provisions further speaks of making an application to the District Administration for registration
and on such application the registration should be effected and such registered worker should be
issued an identity card which is also treated as smart card carrying a unique identification
number.15
And finally, the Act makes miscellaneous provisions, including the Central Governments
powers as to issuing directions under this Act, and making rules for the purpose of this Act and
on matters enlisted under section 12. Similarly, the State Government is also empowered to make

11 Section 6(2), Unorganized Workers Social Security Act, 2008.

12 Section 7, Unorganized Workers Social Security Act, 2008.
13 Section 8, Unorganized Workers Social Security Act, 2008.
14 Section 9, Unorganized Workers Social Security Act, 2008.
15 Section 10(3), Unorganized Workers Social Security Act, 2008.
9

rules under this Act.16 Besides other provisions under this chapter, the Section 16 provides for
saving clause, wherein the provisions of any corresponding law of the States, if having more
beneficial effect, then the provisions of this Act should not affect them.

[4] KEY FEATURES OF THE ACT

[4.1] ENABLING FRAMEWORK FOR SOCIAL SECURITY SCHEMES
[4.1.1] The Act enables the central government to formulate welfare schemes for unorganised
sector workers regarding (i) life and disability cover; (ii) health and maternity benefits; (iii) old
age protection; and (iv) any other benefit decided by the government. Eleven existing social
security schemes for the unorganised sector workers are listed in this Bill. 17 The central
government may modify this list by notification. The Bill also enables state governments to
formulate welfare schemes related to (i) the provident fund; (ii) employment injury benefits; (iii)
housing; (iv) educational schemes for children; (v) skill upgradation of workers; (vi) funeral
assistance; and (vii) old age homes.
[4.1.2] Any notified scheme may be wholly funded by the central or state government or both,
and could require contributions by the beneficiaries of the schemes or their employers.
[4.1.3] Welfare schemes introduced under this Bill will not affect existing welfare schemes of
any state that may be more beneficial to unorganized sector workers.
[4.2] CREATION OF STATE AND NATIONAL SOCIAL SECURITY ADVISORY BOARDS
[4.2.1] The Act establishes a national level Social Security Advisory Board to: (a) recommend
suitable welfare schemes for different sections of unorganised sector workers; (b) advise the
central government on the implementation of this Bill; (c) monitor relevant centrally
16 Section 14, Unorganized Workers Social Security Act, 2008.
17 (a) National Old Age Pension Scheme; (b) National Family Benefit Scheme; (c)
National Maternity Benefit Scheme; (d) Mahatma Gandhi Bunkar Bima Yojana; (e)
Health Insurance Scheme for Handloom Weaver; (f) Scheme for pension to Master
Crafts persons; (g) Group Accident Insurance Scheme for Active fishermen; (h)
Saving-cum-Relief for the fishermen; (i) Janshree Bima Yojana; (j) Aaam Admi Bima
Yojana; (k) Swasthya Bima Yojana.
10

administered welfare schemes; and (d) review state level record keeping functions and
expenditures under various schemes. The national board will consist of an appointed chairperson,
a member secretary, and 31 nominated members.18
[4.2.2] The Act also establishes state level Social Security Advisory Boards. The state boards will
have similar functions as the central board at the relevant state and district levels. Each state
board will consist of an appointed chairperson, a member secretary, and 26 nominated
members.19
[4.3] REGISTRATION AND SMART CARDS FOR UNORGANISED SECTOR WORKERS
[4.3.1] Unorganized workers must apply for registration with the district administration. An
individual must be 14 years or older and should declare that he is an unorganised sector worker.
Upon registration, the district administration will issue a portable smart card carrying a unique
identification number.20
[4.3.2] If a scheme requires contribution from the registered unorganised worker, he will be
eligible for social security benefits under that scheme only if he has made the required
contribution.

[5] MAJOR LIMITATIONS OF THE ACT

Any legislation is meant for guaranteeing certain legal commitments on the part of the state; this
Act, instead, leaves the implementation entirely to the whims of governments of the day.
[5.1] NO SOCIAL SECURITY
The name itself is a misnomer because the Act does not provide any social security (except mere
registration) to any section of workers. The Act does not guarantee anything other than the
formation of an advisory board at central- and state-level and making the respective Labour
Ministers the chairpersons of the same. This is the highest ever fraud on unorganised workers,
18 Section 5, Unorganized Workers Social Security Act, 2008.
19 Section 6, Unorganized Workers Social Security Act, 2008.
20 Section 10, Unorganized Workers Social Security Act, 2008.
11

who not only constitute one third of the entire population but contribute two third of our national
income.
[5.2] AMBIGUITY IN DEFINITION
The Act says, unorganised worker also includes a worker in the organised sector, who is not
covered by any of the Acts mentioned in Schedule II of this Act. At the surface level, it might
appear that unorganized workers of organized sector are also covered by the act. But, it says that
the workers covered under the purview of ESI Act (and also PF Act, ID Act, Workmen
Compensation Act, Maternity Benefits Act and Gratuity Act) will not come under the ambit of
the present legislation, which implies that 2.92 crore casual and contract workers in the
organized sector will be completely left out of the purview of the present legislation.
Furthermore, it has defined unorganized sector as enterprises employing less than 10 workers.
The Act says that unorganized worker means a home-based worker, self-employed worker or a
wage worker in the unorganized sector but it is also subjected to the condition of a ceiling on
monthly earnings which is not defined. It could be the ceiling for determining BPL (Rs.300 in
rural areas and Rs.500 in urban areas) or could be the extent of landholding or could be anything
which is unknown and yet to be notified by the government.

[5.3] NEITHER REGULATION NOR SOCIAL SECURITY

The Act neither provides for regulation of conditions of employment nor any social security
schemes; neither encompasses agrarian labourers nor extends to all unorganized workers; neither
makes a categorical definition of unorganized workers nor binds the government to any
commitment; neither provides a mechanism for implementation nor suggests penalty for nonimplementation; neither creates a corpus fund nor makes a categorical promise of generating
resources.

[5.4] SOCIAL SECURITY: A MIRAGE

12

The Act has mentioned that the government would periodically notify schemes related to life and
disability cover, health and maternity benefits, old age protection and any other benefit as may be
determined by the central government. It has also mentioned ten schemes in the schedule which
includes Aam Admi Bima Yojana, Rashtriya Swasthya Bima Yojana, Janshree Bima Yojana,
Janani Suraksha Yojana, Old Age Pension, Family Benefit and schemes related to weavers,
artisans and master crafts persons. None of these schemes are new and are mostly applicable
only for BPL families. Most of the urban unorganized workers may not fall under the BPL
category. The BPL income of Rs 500 is too less even for bare existence in urban areas. Moreover,
most of these schemes are insurance schemes which are to be sourced from workers and operated
by insurance companies. The only possibility is that the central and state governments may
subsidise contributions from BPL workers at a ratio of 75:25. Beyond this, there appears to be no
plan

for

the

government

to

fund

the

entire

social

security

schemes.

The state governments have been given a free hand to design their own schemes related to
provident fund, employment injury benefit, housing, education, skill upgradation, funeral
assistance and old age homes. It can be noted that none of them are mandatory on any
government.
[5.5] UNKNOWN RESOURCES AND NOTIONAL SCHEMES
Nowhere in the Act can one find explanation of the scope of the Act, targeted beneficiaries,
implementation and grievance redressal mechanisms, penalties for violation or any other
common features expected in any act worth the name. But, it says that all these will be taken care
of by the (notional) schemes that would be notified by the central government from time to time.
The Act is too vague on the point from where will one get the requisite funds for the operation of
those notional schemes. Schemes may be funded partly by the central and state governments,
partly by the contributions from workers and from employers. Not only are the workers but also
are the employers, an unknown quantity.

[5.6] THE HOAX OF BOARDS

13

There is a lot of hue and cry over the formation of social security boards. The fundamental nature
of those boards is only recommendatory and advisory in nature. They are toothless and they
cannot take any decision on their own but for recommending possible schemes and advising on
issues of administration to the government. They may also review issues related to the
registration of workers and monitor schemes notified by the government. The board has no
power, no authority over anything. If forming such advisory boards is the intention of the
government it does not require any legislation, just a government order would have sufficed.
[5.7] EXCLUDED SECTIONS
The NSSO 61st Round report put the number of non-regular workers in the organised sector at
2.92 crore and they include contract, casual workers probationers and trainees, para workers
and temps etc. [According to 61st Round of National Sample Survey in 2004-05, the number of
unorganised workers in the Indian economy stood at 42.26 crore, of which 39.35 crore are in the
unorganised sector of economy and 2.92 crore are unprotected workers in the organised sector of
economy. According to the same sample survey 6.26 crore of workers are employed in the
organised sector of economy. This means one-third of workers in the organised sector who enjoy
no job security or social security or wage security have been left out from the purview of the bill
for the sole fault of working in the organised sector. Unorganised workers in the cooperative
sectors have been totally excluded. India has 1.38 crore workers in the cooperative sector
including self-employed workers like weavers. All of them have been left out. There are 6.5 lakh
anganwadi workers and an equal number of helpers under the ICDS programme alone covering
6.49 lakh anganwadi centres in the country. Besides these workers, there are mid-day meal
workers in many States covering primary school children. All over the country, around 17 lakh
workers are involved in this scheme. There are about 2.4 million para workers including para
health workers and para teachers and non-regularised employees of local bodies including
municipal workers. Neither the governmental or quasi governmental bodies employing them
provide comprehensive social security to them nor have they been brought under the ambit of the
Bill. So, nearly 50 million workers already stand excluded from social security by this
inclusive government.

[6] IMPLEMENTATION ISSUES: THE FAILURE FRONT

14

The prime issue in implementation of the Act is that there is no Justiciable Social Security given
to unorganised workers. To make a right justiciable, it must be defined, although the stated
objective of the Act is to provide social security and welfare to the unorganised workers, the Act
does not confer any defined right to social security for them. In the Act, social security schemes
are not included as part of the body of the Act and are given in a schedule. This essentially means
that schemes can be changed at any point of time by a notification, and not after discussion in the
Parliament, thereby denying the workers the benefit of consistency and justiciability. Also, the
Act does not provide any additional and new welfare scheme rather just mentions 10 existing
welfare legislations as the applicable schemes under the Act.21
The fairness and effectiveness of the implementation of the Act greatly depends on the
availability of a functional institution of grievance redressal mechanism, through which workers
have recourse to a method for registering their complaints about violations. Thus, a new Chapter
needs to be added on Dispute Settlement requiring the government to formulate a model Dispute
Settlement Mechanism for unorganised workers of each occupations involving local
administration, employers, police and other authorities for resolving disputes and grievances.
The mechanism should be empowered for arbitrating and also for punishing faulty employers.
The district administration, the state boards established under the Act 22 and the National Board
should also be empowered to entertain and enforce complaints from aggrieved workers.

[7] PROPOSED AMENDMENTS IN THE ACT

The National Convention on Social Security for Unorganised Workers have proposed a number
of amendments to overcome the deficiencies in the Unorganised Workers Social Security Act,
2008 and to make it relevant and meaningful to about 40 crore unorganised workers in India.23

21 Section 3 (2).
22 Section 6, Unorganized Workers Social Security Act, 2008.
23 Suggested amendments to the unorganised workers social security Act, 2008, National
Convention on social security for unorganised sector, January 8-10, 2010.

15

[7.1] DEFINITIONS NOT INCLUSIVE

Section 2(l) needs to be amended deleting coverage of enterprises employing less than 10
workers.
PROPOSED AMENDMENT
Section 2 (l)- unorganized sector means an enterprise owned by individuals or self employed
workers and engaged in the production or sale of goods or providing service of any kind
whatsoever and where the enterprise does not fall under the definition of factories in Factories
Act, 1948.24
[7.2] SOCIAL SECURITY NOT DEFINED
The Act does not give any clarity on what the State means by 'Social Security'. Chapter II
explains the possible schemes of social security. Social security cannot be reduced to schemes
but should be articulated from the perspective of rights derived from constitutional rights and
principles.
PROPOSED AMENDMENT
An additional sub section may be added as section 2(i) unless otherwise provided in this Act or
schemes made there under social security means measures by the government in collaboration
with employer, worker or otherwise, designed to meet the contingencies in life of a worker,
namely old age pension, unemployment benefits, maternity benefits, livelihood loss
compensation, accident and medical care, provident fund etc.25
[7.3] DEFINITION EXCLUDES WORKERS DEPENDENT ON LIVELIHOOD SYSTEMS

24 Ibid.
25 Suggested amendments to the unorganised workers social security Act, 2008, National
Convention on social security for unorganised sector, January 8-10, 2010.

16

The definitions exclude workers dependent on livelihood systems - like forest workers and
fishworkers, who could not be brought within the ambit of 'home-based worker', 'self-employed
worker', and 'wage worker'. For instance, most of the traditional fishworkers in India follows a
sharing system, in which the catch is shared among the boat owner and the crew.
PROPOSED AMENDMENT: SECTION 2 (M)
Section 2 (m) reads as unorganised worker means a home based worker, self employed worker
or a wage worker in the unorganized sector and included a worker in the organized sector who is
not covered by any of the Acts mentioned in Schedule II to this Act; and
In section 2(m) following words should be added after the words, who is not covered and
includes workers dependent on traditional livelihood systems as specified in the schedule.
[7.4] DEFINITION EXCLUDES UNPAID WOMEN WORKERS AND UNPAID FAMILY MEMBERS
In this Act, the unpaid women workers are not covered as they do not fall within the definitions
of home-based worker, self-employed worker, or wage worker. In all these definitions,
wage or monthly earnings are a precondition for being considered as unorganised worker. The
definition of self-employed worker should include unpaid women workers, unpaid family
members engaged in the work done by the family for livelihood, and workers paid in kind.
PROPOSED AMENDMENT: SECTION 2 (K)
Section 2 (k) read as Self-employed worker means any person who is not employed by an
employer, but engages himself or herself in any occupation in the unorganised sector subject to a
monthly earning of an amount as may be notified by the central government or the state
government from time to time or holds cultivable land subject to such ceiling as may be notified
by the state government (following words should be added here) and also includes unpaid
women worker and unpaid family member engaged in household or other family occupations.
[7.5] NO JUSTICIABLE SOCIAL SECURITY TO UNORGANISED WORKERS
A justiciable right is one in which the aggrieved individual can seek remedy in a court of law. To
make a right justiciable, it should be defined and be available for the individual for a sufficiently
long period of time. Although the stated objective of the Act is to provide social security and
17

welfare to the unorganised workers, the Act does not confer any defined right to social security
for them. In the Act, social security schemes are not included as part of the body of the Act and
are given in a schedule. This essentially means that schemes can be changed at any point of time
by a notification, and not after discussion in the Parliament, thereby denying the workers the
benefit of consistency and justiciability.26
PROPOSED AMENDMENT
Section 3.(1) be modified to begin with
The Central Government may, by notification in the Official Gazette, frame schemes to be called
the Unorganised Workers Social Security Fund Schemes for the establishment of Social Security
fund under this Act for unorganized workers as defined in this Act, to whom the said Schemes
shall apply and there shall be established, as soon as may be after the framing of the Schemes, a
Fund in accordance with the provisions of this Act and the Schemes on matters relating toSection 3(2) may be modified as follows:
The schemes included in the Schedule I to this Act be suitably amended to include all
unorganized workers as defined in the Act and by notification in the Official Gazette, be made
social security schemes under this Act.
[7.6] SOCIAL SECURITY NOT UNIVERSAL AND, THEREFORE, CONSTITUTIONALLY INVALID
Most of the schemes are available only for BPL workers. A person earning more than Rs.12 per
day in a village is not considered BPL as per the current BPL norms, which leave a large
proportion of the deserving poor outside the safety net. The Central Vigilance Commissioner
(CVC) has, therefore, recommended enhancing the number of BPL families. By this restrictive
clause in the schemes, more than 90 per cent of the unorganised workers, the contingencies of
whose lives have pushed them into poverty and increased vulnerabilities, are, in effect, denied
the benefits of the schemes mentioned in the schedule of the Act.
In the Schemes given in the Schedule I of the Act, unorganised workers, except the BPL workers,
have been generally excluded from enjoying the benefits of the schemes, and, therefore, from the
26 Ibid.
18

benefits of the Act. This generalised exclusion is constitutionally invalid. It is in violation of

Article 14 of the Constitution, which does not permit generalised discrimination.

PROPOSED AMENDMENT
The act should specifically provide:
Section 3(2) may be modified as follows: The schemes included in the Schedule I to this Act be
suitably amended to include all unorganised workers as defined in the Act and by notification in
the Official Gazette, be made social security schemes under this Act.27
[7.7] NO SOCIAL SECURITY FUND
The absence of a financial memorandum to the 2008 Act as well as the non-allocation of funds
for social security for unorganised workers in 200809 and 200910 budgets casts doubts on the
genuineness of governments intentions in delivering social security rights to the unorganised
workers in India. The Act should have provided for the creation of a Social Security Fund, and a
financial memorandum for budgetary allocation for the Fund.
PROPOSED AMENDMENT
We suggest for adding a clause under Section 4(1) of the Act as under.
Section 4(1)A: There shall be created a National Social Security Fund and all contributions,
grants, donations and other proceeds shall be deposited with the National Social Security Fund.
The Government of India shall make budgetary provisions for transferring budget allocation for
social security for unorganised workers to this Fund subject to minimum of five percent of the
total budget.
[7.8] ABSENCE OF GRIEVANCE REDRESSAL MACHINERY

27 Suggested amendments to the unorganised workers social security Act, 2008, National
Convention on social security for unorganised sector, January 8-10, 2010.

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The fairness and effectiveness of the implementation of the Act greatly depends on the
availability of a functional institution of grievance redressal mechanism, through which workers
have recourse to a method for voicing their complaints about violations.
PROPOSED AMENDMENT
A new Chapter be added on Dispute Settlement:
Chapter VII(1): The government should formulate a model Dispute Settlement Mechanism for
unorganised workers of each occupations involving local administration, employers, police and
other authorities for resolving disputes and grievances relating to employment, livelihood,
encroachment, displacement, land rights, discrimination, state actions etc with powers to
grievance redressal authority to enforce attendance, take evidence, inspections and
investigations, seize records and such other powers as necessary to resolve dispute or differences
amicably between parties and if necessary to refer the dispute for arbitration.
[7.9] INCONSISTENCIES IN THE CONSTITUTION AND POWERS OF THE BOARD
The Act is for unorganized workers, but the representation of workers is from unorganized
sector.
The Social Security Boards have only advisory role according to the Act. The Board will be
effective only if they are given powers to administer and enforce.
PROPOSED AMENDMENTS
The word, sector to be deleted from Section 5(2)(c)(i) and Section 5(2)(c)(ii).
Replace the word, monitor in Section 5(8)(c) by the words administer and enforce to read
Section 5(8)(c): administer and enforce such social security schemes for unorganized workers as
are as administered by the Central Government.
Section 6(8)(c): administer and enforce such social security schemes for unorganized workers as
are as administered by the State Government.
[7.10] REGISTRATION OF EMPLOYER
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The Act does not bestow any responsibility on the employer, wherever, an employer-employee
relationship exists. The Act should provide for the registration of an employer of an unorganised
worker, as the case may be.28

[8] CONCLUSION
The Act as enacted is totally inadequate. Government ignored recommendations of all the
workers organisations and its own commissions. The law has failed to indicate clearly the extent
of funds that must be earmarked for providing social security and welfare. In all, the Act suffers
from a serious lack of legislative policy and intent.
The Unorganised sector being so diverse; the major challenge is to extend social security to 300
million workers covering all States and all groups of workers. As India has not implemented
protective social security schemes on a large scale, more debate and discussions are needed for
better implementation. The Unorganized Workers Social Security Act, 2008 can be considered
as a welcome legislation from the government where the function of registration of workers, the
biggest advantage of the entire Act. But, the Act fails measurably on the implementation front
and requires reconsideration in this regard.

28 Suggested amendments to the unorganised workers social security Act, 2008, National
Convention on social security for unorganised sector, January 8-10, 2010.

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[9] REFERENCES
BOOKS

MISHRA S.N., AN INTRODUCTION TO LABOUR & INDUSTRIAL LAWS (7th

Edition, Allahabad Law Agency, 2010).

PILLAI K.M., LABOUR AND INDUSTRIAL LAWS (14th Edition, Allahabad Law

Agency, 2012).
SINGH AVTAR, INTRODUCTION TO LABOUR AND INDUSTRIAL LAW (2 nd

Edition, Lexis Nexis, 2008).

DR. V.G.GOSWAMI, LABOUR AND INDUSTRIAL LAWS (9 th Edition, Central Law

Agency, 2011).
MALIK P.L., HANDBOOK OF LABOUR AND INDUSTRIAL LAWS (14 th Edition,

Eastern Book Co., 2013).

SHARMA A.M., ASPECTS OF LABOUR WELFARE AND SOCIAL SECURITY, (7 TH

Edition, Himalaya Publishing House, New Delhi, 2009).

BHATNAGAR DEEPAK, LABOUR WELFARE AND

LEGISLATION IN INDIA (24th Edition, Deep & Deep Publication, New Delhi, 2012)
GUPTA N.H., SOCIAL SECURITY LEGISLATION FOR LABOUR IN INDIA (12 th

Edition, Deep & Deep Publication, 2010).

PURI S.K., INTRODUCTION TO THE LABOUR AND INDUSTRIAL LAWS, (15 th
Edition, Allahabad Law Agency, 2011).

WEBSITES

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SOCIAL

SECURITY

http://www.ilo.org/dyn/travail/docs/686/Unorganised%20Workers%20Social%20Security
%20Act%202008.pdf.

http://labour.gov.in/upload/uploadfiles/files/ActsandRules/SocitySecurity/TheUnorganise
dWoekersSocialSecurityAct2008.pdf.

http://www.epw.in/commentary/critique-unorganised-workers-social-security-act.html.

http://www.prsindia.org/billtrack/the-unorganised-sector-workers-social-security-bill2007-434/

http://www.advocatekhoj.com/library/bareacts/unorganised/index.php?Title=Unorganised
%20Workers%20Social%20Security%20Act,%202008.

http://www.thealternative.in/society/review-of-social-security-for-unorganized-workersin-india/.

http://www.sacw.net/article658.html.

http://www.cec-india.org/archs/SSN-2010--Suggested-Amendments-to-the-USSW-Act2008.pdf

http://articles.economictimes.indiatimes.com/2012-12-19/news/35912487_1_ageprotection-social-security-health-and-maternity-benefits.

http://india.gov.in/topics/labour-employment/unorganized-sector-workers.

http://foundation.ifmr.co.in/wp-content/uploads/2014/05/CSS-Report.pdf

http://164.100.47.132/LssNew/psearch/QResult16.aspx?qref=5621

http://www.wunrn.com/news/2010/02_10/02_22_10/022210_india2.htm.

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http://www.lawzonline.com/bareacts/unorganised-workers-social-securityact/unorganised-workers-social-security-act.html.

http://lawyerslaw.org/the-unorganised-sector-workers-social-security-act-2008/

http://www.businessnonstop.in/sme-buzz/unorganised-workers-social-security-act-2008supporting-workers-in-unorganised-enterprises.html

http://www.academia.edu/11955096/Unorganised_Workers_Social_Security_Schemes

http://www.comply4hr.com/showact.asp?act=UWSCA

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