Social security for the workers of the unorganised sector as well as the gig workers was the focus area of recently held Chintan Shivir (conference) of Labour Ministers and Secretaries from the Union and State.

Major Outcomes of the Meeting

• Labour Codes: The discussions focused on the implementation of the four Labour Codes.
  • Code on Wages, 2019,
  • Industrial Relations Code, 2020,
  • Code on Social Security, 2020 and
  • Occupational Safety, Health and Working Conditions Code, 2020.
• Social Security for Unorganized Workers: The conference extensively discussed social security for unorganized sector workers.
• Formation of Committees: The meeting resulted in the formation of three committees  to develop a sustainable model for comprehensive social security coverage for workers. 
  • These committees are expected to submit their reports by March 2025. 

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What is Social Security?

• Definition: Social security refers to a system of protection designed to safeguard individuals and households from economic risks and vulnerabilities. 
  • According to the International Labour Organization (ILO), social security is, “The protection provided to individuals and households to ensure access to health care and to guarantee income security, particularly in cases of old age, unemployment, sickness, invalidity, work injury, maternity, or loss of a breadwinner.”
• Key Components of Social Security:
  1. Health Care Protection: Ensures affordable medical treatment and support.
  2. Old Age Security: Pensions and retirement benefits.
  3. Unemployment Benefits: Financial support during job loss.
  4. Disability and Work Injury Benefits: Compensation for work-related accidents or permanent disability.
  5. Maternity and Family Benefits: Financial and medical support for mothers and families.
  6. Survivor Benefits: Assistance for dependents after the loss of a breadwinner.

Need for Social Security

• Poverty Alleviation: Social security programs help reduce poverty by providing financial support to vulnerable populations.
  • MGNREGA has provided employment to over 110 million rural households since its inception, lifting many out of poverty.
• Poor Working Conditions and Exploitation: Unorganised sector workers face long hours, no paid leave, and unsafe workplaces.
  • The construction sector has one of the highest workplace accident rates, with thousands of deaths annually due to unsafe working conditions.
• Economic Stability:  Social security helps stabilize the economy during downturns. 
  • For example, unemployment benefits allow people to continue spending, which supports businesses and prevents deeper recessions.
• Protection Against Life Risks: Social security protects individuals from unforeseen events such as job loss, disability, or illness, which can lead to financial hardship.
  • The Ayushman Bharat program has led to a 21% reduction in out-of-pocket healthcare expenditures and an 8% decrease in the incidence of emergency loans taken for health-related expenses.
• Support for the Elderly: Pensions and retirement benefits provide financial security for older adults who are no longer able to work.

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Initiatives to Improve Social Security

• The Code on Social Security, 2020: The Code consolidates and amends existing social security laws to extend coverage to all employees and workers, including those in the unorganized sector. 
  • It contains provisions for life and disability insurance, health and maternity benefits, provident funds, and pensions.
• Pradhan Mantri Jan Arogya Yojana (PM-JAY): Launched under the Ayushman Bharat initiative, PM-JAY aims to provide health insurance coverage of up to Rs. 5 lakh per family per year for secondary and tertiary care hospitalization. 
• eShram Portal: The government introduced the eShram portal to create a national database of unorganized workers, including gig and platform workers. 
• Social Security Initiative for Gig Workers: The Union Budget 2025 introduced measures aimed at strengthening social security for gig workers.
• MGNREGA: It aims to guarantee the ‘right to work’ by providing at least 100 days of wage employment in a financial year for unskilled manual work. 
  • It is considered one of the world’s largest public work programs. 
• Pradhan Mantri Shram Yogi Maandhan (PMSYM): The scheme provides pension security to unorganized sector workers.
  • Workers aged 18–40 earning less than Rs. 15,000 per month can enroll. They receive a monthly pension of Rs. 3,000 after turning 60.
• International Commitments: 
  • India ratified the UN Covenant on Social, Economic, and Cultural Rights, which recognizes the right to social security.
  • India has also accepted ILO Recommendation 202, which outlines the essential components of a Social Protection Floor tailored to national circumstances.

Challenges in Social Security for Unorganized Sector

• Delayed Implementation of the Four Labour Codes: The four new Labour Codes were passed between 2019 and 2020 with the aim of consolidating 29 existing labour laws into a simplified and modern framework.
  • However, their implementation has faced significant delays due to state-level challenges, compliance issues, and opposition from various stakeholders.
• Lack of Formal Employment Records: Most unorganized sector workers lack formal employment contracts, making it difficult to identify and enroll them in social security schemes.
  • Construction workers, domestic workers, and street vendors often work without any formal documentation.
• Low Awareness and Literacy: Many workers in the unorganized sector are unaware of the social security schemes available to them.
• Financial Constraints: Low and irregular incomes make it difficult for workers to contribute to social security schemes.
  • Many workers earn less than the minimum wage and prioritize immediate needs over long-term savings.
• Bureaucratic Hurdles: Complex enrollment processes and excessive documentation requirements deter workers from registering for social security schemes.
  • Workers often face difficulties in obtaining necessary documents like Aadhaar cards, bank accounts, and proof of income.

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Way Forward

• Expanding Social Security Coverage: Universal social security under the Code on Social Security, 2020, ensuring access to healthcare, pensions, maternity benefits, and insurance.
  • As of 2024, over 30 crore unorganized workers have been registered on the e-Shram Portal, but only 10% have access to social security benefits like pensions and healthcare.
• Ensuring Minimum Wages and Income Security: Effective implementation of the Code on Wages, 2019, ensuring minimum wages and timely payments.
  • A 2021 report by the ILO found  266 million wage earners are paid less than the minimum wage. 
• Improving Working Conditions and Safety Standards: Enforcement of the Occupational Safety, Health and Working Conditions Code, 2020, to ensure safe workplaces and regulated working hours.
  • In 2024, over 400 workers died in construction-related accidents, highlighting gaps in safety enforcement.
• Legal Protection and Job Security for Domestic and Gig Workers: Introduction of a Central Law for Domestic Workers, as recommended by the Supreme Court.
  • Regulation of gig economy work, mandating fair wages, social security benefits, and accident insurance.
  • A 2023 study by the Indian Federation of App-based Transport Workers (IFAT) found that 76% of gig workers earn less than Rs. 15,000 per month.
• Awareness and Strengthening Union Representation: Campaigns to educate workers about their rights under new labour codes and welfare schemes.

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