CURRENT AFFAIRS – 03/05/2023
Why are Blinkit workers protesting?
At risk: A Blinket delivery agent on his way to deliver groceries in New Delhi in 2022. File Photo
How did the strikes start? What is ‘platform work’? Do the new Labour Codes protect the rights of gig workers? Does the Code on Social Security, 2020 differentiate between employee and gig worker? Have there been petitions in courts to legally recognise gig work and workers?
AARATRIKA BHAUMIK
EXPLAINER
The story so far:
The recent strike by Zomato-owned Blinkit delivery agents has once again brought to the forefront issues plaguing the gig economy in the country. The strikes began when Blinkit rolled out its new payout structure for delivery executives, under which the minimum payout per delivery was slashed to ₹15 from ₹25. As a result, Blinkit delivery executives are now set to earn ₹600-700 a day as opposed to ₹1,200 before.
Who is a ‘gig worker’?
Gig workers refer to workers outside of the traditional employer-employee relationship. There are two groups of gig workers — platform workers, and non-platform workers. When gig workers use online algorithmic matching platforms or apps to connect with customers, they are called platform workers. Those who work outside of these platforms are non-platform workers, including construction workers and non-technology-based temporary workers.
Whether gig workers should be categorised as ‘employees’ or as ‘independent contractors’ has been a heated debate. In India, employees are entitled to a host of benefits under statutes such as the Minimum Wages Act, 1948, Employees’ Provident Fund and Miscellaneous Provisions Act, 1952 (EPFA), and the Payment of Bonus Act, 1965. Similarly, contract labourers are governed under the Contract Labour (Regulation and Abolition) Act, 1970 and are also entitled to benefits such as provident funds. However, given the unique nature of gig work, gig workers display characteristics of both employees and independent contractors and thus do not squarely fit into any rigid categorisation. As a result, gig workers have limited recognition under current employment laws and thus fall outside the ambit of statutory benefits.
What is the proposed law?
The Ministry of Labour and Employment introduced the Code on Social Security, 2020 which brings gig workers within the ambit of labour laws for the first time.
Under section 2(35) of the Code, a ‘gig worker’ is defined as ‘a person who performs work or participates in a work arrangement and earns from such activities outside of a traditional employer-employee relationship’. The Code defines platform work as ‘a work arrangement outside of a traditional employer-employee relationship in which organisations or individuals use an online platform to access other organisations or individuals to solve specific problems or to provide specific services” in exchange for payment. Although the Code recognises ‘gig workers’, it distinguishes between such workers and employees. While employees have benefits such as gratuity, employee compensation, insurance, provident fund, and maternity benefits, the Code stipulates that Central and State governments must frame suitable social security schemes for gig workers on matters relating to health and maternity benefits, provident funds and accident benefits among others.
The Code also mandates the compulsory registration of all gig workers and platform workers to avail of the benefits under these schemes.
What are some of the concerns?
Out of the four new labour codes proposed, gig work finds reference only in the Code on Social Security. As a result, gig workers remain excluded from vital benefits and protections offered by other Codes such as minimum wage, occupational safety etc. They also cannot create legally recognised unions. Moreover, they remain excluded from accessing the specialised redressal mechanism under the Industrial Disputes Act, 1947, denying them an effective remedy for grievances against their employers. Considering the non-traditional nature of their work, gig workers also do not have the right to collective bargaining — a fundamental principle of modern labour law crucial to safeguard the rights of workers.
A 2022 report by Fairwork India, an international research project, highlighted the deplorable working conditions of the employees of digital labour platforms in India and the need for statutory affirmation of the rights of gig workers. Despite receiving the assent of the President, the Labour Codes are still awaiting implementation three years on. The Centre has said that this is due to the delay in framing of rules by the States.
Have the courts intervened?
On September 20, 2021, the Indian Federation of App-based Transport Workers (IFAT) filed a public interest litigation on behalf of gig workers before the Supreme Court. The petition demanded that gig workers or platform workers be declared as ‘unorganised workers’ so that they can come under the purview of the Unorganised Workers’ Social Security Act, 2008 (UWSS Act) and be provided with statutory protection in the form of social security benefits. It has been contended that the exclusion of gig workers from the category of ‘unorganised workers’ or ‘wage workers’ under Sections 2(m) and 2(n) of the UWSS Act is violating their fundamental rights under Articles 14 and 21 of the Constitution. Further, it has been argued that such denial of social benefits amounts to exploitation through forced labour, within the meaning of Article 23.
Although the Supreme Court sought the Centre’s response to this petition back in December 2021, the Centre has not yet responded.
THE GIST
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The Blinkit strikes began when the company rolled out its new payout structure for delivery executives, under which the minimum payout per delivery was slashed to ₹15 from ₹25.
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Gig workers refer to workers outside of the traditional employer-employee relationship. Whether gig workers should be categorised as ‘employees’ or as ‘independent contractors’ has been a heated debate.
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A 2022 report by Fairwork India, an international research project, highlighted the deplorable working conditions of the employees of digital labour platforms in India and the need for statutory affirmation of the rights of gig workers.
The LAC crisis and the danger of losing without fighting
Sushant Singh
is Senior Fellow of the Centre of Policy Research, New Delhi
India will have to wrest the initiative from China as far as the border crisis is concerned or else things will happen only at a time and place of Beijing’s choosing.
It was in the first week of May 2020 that news broke of ingress by China’s People’s Liberation Army (PLA) in multiple areas across the Line of Actual Control (LAC) in Ladakh. Three years later, some of those areas have witnessed disengagement — pulling troops apart by a few miles of buffer zones — while two of them, Depsang and Demchok, remain unresolved. Indian soldiers cannot touch 26 of the 65 patrolling points in Ladakh.
Neither diplomatic meetings nor talks between corps commanders have elicited any progress since September last year; regular meetings between Indian and Chinese Ministers, Foreign and Defence, have not yielded results either. Beijing has ignored Delhi’s talking points, even after they have been watered down so much that India no longer demands a return to the status quo of April 2020. Verbose non sequiturs in Indian statements can hardly cover up the government’s failure in handling the current China crisis.
The Depsang crisis of 2013
During the 2013 Depsang crisis, the United Progressive Alliance was in power, the current External Affairs Minister S. Jaishankar was India’s Ambassador to Beijing and the current Governor of Arunachal Pradesh, Lt. Gen. K.T. Parnaik (retired) was the Northern Army Commander. The PLA had then blocked Indian patrols at Bottleneck or Y-Junction, the same place where it has now blocked them in Depsang since 2020. Within three weeks, the PLA had been forced to lift the block after the Indian Army, as per Lt. Gen. Parnaik, launched a quid pro quo operation on the Chinese side in Chumar. Negotiations followed, including in Beijing, and the status quo as it existed before PLA’s block was restored.
The criticism of the government over those three weeks was deafening. Narendra Modi, then Chief Minister of Gujarat, argued that the problem was not on the border but in Delhi. He also asked why our soldiers were vacating the area after disengagement if they were on Indian territory.
Most media reports were strident in criticising the government then, but the same journalists have been silent when the very same spot has been blocked by the PLA for over three years. Their constant labelling of Depsang as a legacy issue disconnected with the current crisis so offended former Ladakh Corps Commander, Lt. Gen. Rakesh Sharma (retd.) that he was compelled to pen a strong rejoinder. However, misleading claims about Depsang continue to be regurgitated.
Unlike mainstream media, the military brass (this includes the Indian Army chief General Manoj Pande, and the Northern Army Commander, Lt. Gen. Upendra Dwivedi) has been more forthcoming about the ground realities. The cover up emanates from the political leadership, in the silence of the Prime Minister and the Home Minister or by way of the deceptive euphemisms of the External Affairs Minister. The reason is known even to watchers in Washington DC. A White House official until 2021, Lisa Curtis, wrote recently that the government of the day “might not want its public to know the full extent of PLA activities in disputed areas as this might become fodder to protest government incompetence or inaction”.
Incompetence and inaction
Incompetence may be a function of capability, but inaction seems to be driven by fear — a fear of military escalation in case India were to attempt a proactive move in disputed border areas to unsettle Beijing. If negotiations are about ‘give and take’, New Delhi must militarily take something that its diplomats can then give at the table. Devoid of that, Beijing holds all the cards. No one can deny that China is a much bigger economic, military, industrial and geopolitical power than India, but the gap shrinks considerably when it comes to local balance on the LAC. If Russia is unable to vanquish Ukraine, Chinese President Xi Jinping knows that China cannot militarily walk over India.
The decision rests with the Prime Minister but he seems haunted by the ghost of 1962. Many officials believe that Jawaharlal Nehru was pushed into a military confrontation with China then because of domestic pressure created by the likes of the Swatantra Party and the Rashtriya Swayamsevak Sangh. The Prime Minister does not wish to fall into that trap. They are right. Mr. Modi is no Nehru. Nehru faced Parliament and answered questions regularly, even during the 1962 conflict. Unlike Nehru’s time, the public relations and propaganda machinery now has fabricated such a hyper-nationalist narrative that more than 70% Indians contend that India can militarily defeat China. The pressure on Mr. Modi to militarily deliver, when the ruling party’s political campaigns have ridden the hype of so-called ‘Surgical Strikes’ and Balakot airstrike, is even greater.
Over nine years, Mr. Xi seems to have got the measure of Mr. Modi. Mr. Xi sent PLA soldiers to Chumar even as there was intense media focus and the hyped optics during the Xi visit to Ahmedabad, Gujarat, in 2014. The Chinese leader rebuffed the Indian leader’s plea in Beijing in 2015 to delineate the LAC, has blocked India’s entry into the Nuclear Suppliers Group, and has remained vague about the outcomes of informal summits. Satellite imagery shows that the Chinese were already building massive military infrastructure in Ladakh by the time the Second Informal Summit was taking place in Mamallapuram, off Chennai, in late 2019. However, Mr. Modi’s faith in the force of his personality and personal charm to win over the Chinese leader, such as by offering a handshake and having a chat in Bali last November, did not result in even a telephone call, let alone a breakthrough on the Ladakh border.
Proactive move
India is under pressure on the border, and it needs to find a way to transfer that pressure back to China. Beijing has never compromised unless it has been forced into an uncomfortable spot — a tactic India has deployed since Nathu La in 1967. This warrants India to be proactive, which calls for the political leadership to boldly use its imagination. If the political leadership is timid and fearful, the military on the China border will remain in a defensive posture. If strategic thought in Delhi lacks boldness, tactical actions on the LAC will not be daring. After all, the military is used as an instrument by states to pursue policy ends, to try and impose its will upon the adversary.
India’s failure to impose its will upon China is a direct consequence of its fear of military escalation, in the backdrop of the ghost of 1962 that hovers over the top political leadership’s thinking. Three years after the border crisis began, a status quoist approach can no longer be the answer. India will have to wrest the initiative from China; else things will happen only at a time and place of Beijing’s choosing. Mr. Modi’s personal success may lie in avoiding another 1962 but it would be a national failure for India. Unlike 1962, China would have now won without fighting.
Outlawing India’s tech tariffs
Prabhash Ranjan
is Professor and Vice Dean, Jindal Global Law School. Views are personal
Even if the EU does not impose trade sanctions on India, it might use the WTO ruling as a bargaining chip in the free trade agreement negotiations with India.
On the complaints brought by the European Union (EU), Japan, and Taiwan, three World Trade Organization (WTO) dispute settlement panels have found India’s tariffs on certain information and communication technology (ICT) products such as mobile phones inconsistent with India’s WTO obligations. Specifically, the panels concluded that India has violated Article II of the General Agreement on Tariffs and Trade (GATT) because India’s tariffs breach its Goods Schedule. Since one of the central objectives of the WTO is to boost transparency and predictability in the multilateral trading order, WTO member countries are under a legal obligation not to impose tariff rates in excess of their ‘bound’ or maximum tariff rates committed in their Goods Schedule. The Goods Schedules are based on the World Customs Organization’s classification system, which catalogues traded products with specific names and numbers. This is also known as the Harmonized System of Nomenclature (HSN). Due to the continuous emergence of new products owing to technological innovations, the HSN system is regularly updated to reflect new products, also known as ‘transposition’.
Reasoning of panels
To justify higher tariff rates, India argued that its binding tariff commitments on ICT products are contained in the WTO Ministerial Declaration on Trade in Information Technology Products (ITA Agreement), which India joined in 1997. The ITA Agreement, adopted in 1996, is an arrangement through which select WTO member countries agree to eliminate duties on IT products. However, the commitments under the ITA become binding on a country under Articles II.1(a) and (b) of GATT only if they are incorporated in the Goods Schedule. Accordingly, the panels held that India’s Goods Schedule, not the ITA, is the source of India’s legal obligations on tariffs, including on products covered by the ITA.
The panels also rejected India’s contention that its commitments under the ITA are ‘static’. India argued that its commitments under the Goods Schedule do not include products that emerged due to technological innovations after the conclusion of the ITA. But the panels held that the ITA cannot override the tariff commitments given in India’s Goods Schedule.
Finally, the panels also denied India’s argument based on Article 48 of the Vienna Convention on Law of Treaties, which, inter alia, declares that an error in a treaty would invalidate a state’s consent. India argued that an error was committed during the transposition of its Goods Schedule from the HSN 2002 edition to the HSN 2007 edition. The panels accepted India’s argument that at the time of the transposition, India had assumed that its ITA undertakings restricted the scope of its Goods Schedule — that is, the transposition process into the HSN 2007 edition did not expand the scope of India’s tariff commitments. Nevertheless, the panels held that India failed to show that this assumption formed a necessary basis for India’s consent for the Goods Schedule. In any case, the panels said India was put on notice that its commitments under the Goods Schedule may have expanded during the transposition process.
Appealing ‘into the void’
Accordingly, the panels have recommended that India reduce its tariff rates and make them compatible with its Goods Schedule, but it is unlikely that India will comply. Compliance would mean dismantling the high protective tariff wall that India has erected hoping it will boost domestic manufacturing of ICT products. In fact, India, relying on Article 17 of the WTO’s Dispute Settlement Understanding (DSU), is likely to appeal against the panel ruling. However, the Appellate Body that hears appeals has ceased to exist since 2019 because the United States has been blocking the appointment of the body’s members. Thus, India’s appeal will go into the void. Legally, India will not be required to comply with the panel rulings till the time its appeal is heard.
Relying on Article 25 of the DSU, the EU and a few other WTO member countries have created an alternative appellate mechanism — the Multi-Party Interim Appeal Arbitration Arrangement (MPIA). However, India is not a party to this and will not use it to resolve this dispute.
EU retaliation
Can the EU impose trade sanctions on India in case India does not comply with the rulings, and appeals into the void? Under the WTO law, the EU cannot do so. The WTO law does not allow countries to impose trade sanctions when an appeal is pending. Retaliatory action in the form of trade sanctions can be imposed only after the authorisation of the Dispute Settlement Body, which comprises all WTO members.
Notwithstanding the above, the EU has developed a legal mechanism according to which if a country files an appeal against a panel under Article 17 of the DSU into the void, and refuses to use the MPIA to resolve the dispute, the EU can unilaterally impose trade sanctions against the losing country. The EU’s objective is to use the stick of trade sanctions to push countries like India to join the MPIA. However, such countermeasures will be inconsistent with the WTO law. Individual countries like India can’t be held responsible for a missing Appellate Body. Even if the EU does not impose trade sanctions, it might use this ruling as a bargaining chip in the ongoing free trade agreement negotiations with India. Thus, India needs to tread cautiously.
De-dollarisation: the race to attain the status of global reserve currency
While countries have tried to dethrone the dollar as the global reserve currency for many decades now for various reasons, of late such attempts have picked up pace in the aftermath of Russia’s invasion of Ukraine last year
PRASHANTH PERUMAL
De-dollarisation refers to the replacement of the U.S. dollar by other currencies as the global reserve currency.
A reserve currency refers to any currency that is widely used in cross-border transactions and is commonly held as reserves by central banks. Countries have tried to dethrone the dollar as the global reserve currency for many decades now for various reasons. But of late, attempts to de-dollarise have picked up pace in the aftermath of Russia’s invasion of Ukraine last year. The U.S. imposed several sanctions that restricted the use of the U.S. dollar to purchase oil and other goods from Russia, and this has been seen by many countries as an attempt to weaponise the dollar. Since international transactions carried out in the U.S. dollar are cleared by American banks, this gives the U.S. government significant power to oversee and control these transactions. Currently, the Chinese yuan is seen as the primary alternative to the U.S. dollar owing to China’s rising economic power.
The reserve currency advantage
Other currencies such as the British pound and the French franc have served as international reserve currencies in the past. It should be noted that it is the currencies of economic superpowers that have usually ended up being used as the global reserve currency. As the economic clout of these countries waned, their currencies faced a similar downfall. This was the case, for example, with the British pound which was gradually replaced by the U.S. dollar as Britain lost its status as a global economic superpower in the first half of the 20th century.
Critics of the U.S. dollar believe that the global reserve currency status gives it unfair privileges over other countries, thus justifying de-dollarisation attempts by many countries. It should be noted that when a country’s fiat currency enjoys reserve currency status, it gives the country the power to purchase goods and other assets from the rest of the world by simply creating fresh currency out of thin air. However, such irresponsible expansion of the money supply can cause the debasement of the currency and eventually threaten its status as a reserve currency.
Others point to the expansionary monetary policy adopted by the U.S. Federal Reserve over the decades to argue that this could threaten the U.S. dollar’s status as a global reserve currency. The U.S. central bank usually increases the supply of dollars through various means to tackle economic downturns and also to fund the U.S. government’s expenditures. But it should be noted that the U.S. Federal Reserve is not the only central bank in the world that has been debasing its currency by engaging in expansionary monetary policy over several decades. Other countries have also been expanding their respective money supplies to address their domestic economic problems. As long as the U.S. does not debase its currency at a faster pace than other countries, the dollar may manage to hold its value against other currencies and hence its reserve currency status may not come under serious threat.
The popularity of the U.S. dollar
Many economists argue that the U.S. dollar is not forced on anyone to be accepted as a medium of exchange for cross-border transactions. They note that the U.S. dollar is widely used in international transactions because people actually prefer to use the American currency over others for various economic reasons. Other currencies that have tried to compete against the U.S. dollar are not as popular as the greenback for carrying out international transactions. For example, a recent attempt by India and Russia to carry out trade between the two countries in Indian rupees rather than in U.S. dollars has hit a roadblock because the value of India’s imports from Russia far outweighs its exports to the country. This left Russia with excess rupees in hand which it was unwilling to spend on Indian goods or assets, and led to Russian demands for the settlement of bilateral trade in U.S. dollars. So, even Russia, a long-time friend of India and a long-time foe of the United States, preferred to carry out its trade with India using U.S. dollars since the dollar is far more widely acceptable than the Indian rupee.
The global acceptability of the U.S. dollar has primarily been attributed to the popularity of U.S. assets among investors. It should be noted that the U.S. has been running a persistent trade deficit for decades now (in fact the last time the U.S. ran a trade surplus was way back in 1975). That is, the value of its imports has for a long time exceeded the value of its exports to the rest of the world. The excess dollars that the rest of the world accumulates due to the U.S.’s trade deficit has been invested in U.S. assets such as in debt securities issued by the US government. The high level of trust that global investors have in the U.S. financial markets, perhaps owing to the ‘rule of law’ in the U.S., is considered to be a major reason why investors prefer to invest in U.S. assets. It should, however, be noted that it is not necessary that a country must run a trade deficit for its currency to be accepted as a reserve currency.
China, for instance, which supplies the world with huge volumes of goods and runs a trade surplus, has been trying to make the yuan a reserve currency. However, restrictions placed by the Chinese government on foreign access to China’s financial markets and doubts over ‘rule of law’ in China have adversely affected global demand for the yuan.
A good divorce
Irretrievable breakdown of marriage should be a ground for divorce
Not all marriages are happy, and not all divorces are unhappy. For those who want to opt out of a bad marriage, Monday’s Supreme Court ruling on divorce will be seen as a good move. Leaning on the “guiding spirit” of Article 142(1) of the Constitution to do “complete justice” in any “cause or matter”, a Constitution Bench said it could use this extraordinary discretionary power to grant divorce by mutual consent to couples trapped in bitter marriages. It also aims to spare couples the “agony and misery” of waiting six to 18 months for a local court to annul it, as stipulated under Section 13B of the Hindu Marriage Act, 1955. The Bench, headed by Justice Sanjay Kishan Kaul, observed that the law of divorce, built predominantly on assigning fault, fails to serve broken marriages. It pointed out that if a marriage is wrecked beyond hope, public interest lies in recognising this fact, not upholding a ‘married’ status regardless. The Court said it could use Article 142 to quash pending criminal or legal proceedings, be it over domestic violence or dowry, against the man or woman. Continuing in this strain, the Bench said the Supreme Court could grant divorce on the grounds of an “irretrievable breakdown of marriage” if the “separation is inevitable and the damage is irreparable”. Under the Hindu Marriage Act, irretrievable breakdown of marriage is not yet a ground for divorce.
In its judgment, there was a word of caution that the grant of divorce would not be a “matter of right, but a discretion which is to be exercised with great care… keeping in mind that ‘complete justice’ is done to both parties.” Several factors would be considered by the Supreme Court before invoking Article 142 in matrimonial cases, including duration of marriage, period of litigation, the time the couple has stayed apart, the nature of pending cases, and attempts at reconciliation. The Court will have to be satisfied that the mutual agreement to divorce was not under coercion. In India, while divorcees have doubled in number over the past two decades, the incidence of divorce is still at 1.1%, with those in urban areas making up the largest proportion. But the divorce numbers do not tell the whole story; there are many women, particularly among the poor, who are abandoned or deserted. Census 2011 revealed that the population which is “separated” is almost triple the divorced number. In a country which is largely poor, where gender discrimination is rife and many women are still not financially independent, the Court’s stress on “care and caution” and not to rush into a quick divorce must be welcomed. After all, marriage equality is not a reality for all.
ARTICLE 142
Article 142 provides discretionary power to the Supreme Court as it states that the SC in the exercise of its jurisdiction may pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it.
Article 142 was adopted by the Constituent Assembly on 27 May, 1949. It deals with enforcement of decrees and orders of the Supreme Court and orders as to discovery, etc.
Example- Union Carbide Corporation v. Union of India: In Bhopal Gas Tragedy Case, the court ordered to award compensation to the victims and placed itself in a position above the Parliamentary laws.
China, Russia, Pak. Ministers to attend SCO meet in Goa
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Jaishankar meeting his Chinese counterpart Qin Gang before the start of the G-20 Foreign Ministers’ meeting in March. REUTERS