Prevalence of 'decent work'

The International Labour Organisation (ILO) has described 'decent work' as employment which, first, provides for adequate earnings, second, is completed in decent work time, third, ensures stability and security of work, fourth, provides for equal opportunity and treatment in employment, fifth, is undertaken in a safe work environment and, six, on retirement or unemployment ensures access to social security. The ILO also emphasizes on the need for proper representation of workers through collective bargaining rights and the avoidance of work that has been prohibited by International Conventions.

Findings of the Pakistan Labour Force Survey (LFS) of 2017-18 was published sometime ago by the Pakistan Bureau of Statistics. The survey is undertaken periodically once every two the three years. Information was collected from 43,472 households divided up into four distinct, nationally representative samples, each enumerated in a given quarter during 2017-18.

The LFS enables determination of the prevalence of 'decent work' in Pakistan. The first indicator is adequacy of earnings. The percentage of employed workers who got at least the minimum wage of Rs 15,000 per month is determined. The resulting estimate is an unfortunate revelation and vividly highlights the plight of workers in the country.

An unbelievably high percentage, 53 percent, of workers did not even get the minimum wage in the country. This proportion is the highest in rural areas. Almost 89 percent of agricultural workers received less than the minimum wage. This proportion is also relatively high in manufacturing and wholesale and retail trade at 56 percent and 54 percent, respectively. Fortunately, only 9 percent of jobs in the public administration and defence services carry a wage lower than the minimum wage.

The high incidence of grossly unpaid workers implies that the families of these workers are probably living in conditions of poverty. The cost of meeting minimum basic needs of nutrition and other goods and services was estimated at Rs 3900 per capita in 2017-18. Therefore, the minimum required income of a typical low-income family of 8 persons is Rs 31200 per month. With an average of 1.6 earners per family, this implies that the earning of each worker should be on average at least Rs 19500 per month. Therefore, we have the problem today of not only a low minimum wage but also that the majority of workers are not even receiving this minimum wage. The indications are that the incidence of poverty is currently much higher among workers than revealed by official estimates.

Turning next to working conditions in terms of number of hours worked during a particular working week, here also the results are perhaps unexpected. The norm is taken as 40 hours per week, equivalent to eight hours a working day, five days a week. It is truly amazing that almost 73 percent of workers, according to the LFS, were putting on average more than 40 hours a week in 2017-18. The incidence of overworked workers is higher among employees at 84 percent as compared to 77 percent in the case of the self-employed. Also, the percentage of workers providing inputs of more than 40 hours a week was 71 percent in 2012-13. As such, there is no doubt that Pakistan is a nation of hardworking but underpaid workers.

The next indicator of decent work is that of equal opportunity and treatment in employment. In particular, the issue is of the extent of gender discrimination. The average monthly wage received by female workers was Rs 11,884 in 2017-18. Adjusting for the occupational distribution of male workers to correspond to that for females, their average wage is estimated at Rs 19,550 in the same year. This implies that on average for the same job a female worker receives almost 40 percent less than her male counterpart. This demonstrates the evidence of substantial gender discrimination in the labor market of Pakistan. The difference in wages is most pronounced in the case of skilled agricultural and craft workers.

The definition of 'decent work' also includes employment in a safe working environment. In Pakistan, the LFS reports that almost 4 percent of the workers had work-related injury or disease in 2017-18. This is a high incidence and amounts to almost 2.5 million workers. The distribution of such workers was 42 percent in agriculture, 17 percent in manufacturing and 41 percent in various service activities.

The ILO has also emphasized on the need to abolish highly exploitative forms of work. The prime examples of this are bonded labor and child workers. ILO has reported that there are almost 2 million bonded workers in Pakistan, who are mostly enslaved after their inability to repay loans. The LFS reveals that over 11 percent of children, aged 10 to 14 years, are in the augmented labour force. This implies that there are almost 3 million child workers in Pakistan. This is yet another evidence of the high level of deprivation and poverty among families in Pakistan. There is a dire need for a social safety net for such households to enable them to avoid sending children to work rather than to a school.

Turning to the need for provision of social security to workers, there is a need for pension schemes and unemployment insurance. Unfortunately, the coverage of social security is very limited in Pakistan. Of course, government employees, both civilian and military, are entitled to superannuation. Further, retired employees of state-owned enterprises also receive pensions. However, the coverage beyond the public sector, by the Employees Old Age Benefits Institution (EOBI) is very limited.

There is, in fact, a provision for larger coverage of social security in the country. The FBR collects, along with the income tax, contributions by employers to the Workers Welfare Fund (WWF) and Workers Profits Participation Fund (WPPL). The total amount collected was Rs 16.4 billion under these heads in 2017-18. These funds should have been earmarked for the benefit of workers. This is not the case currently. As such, there is a strong case for allocating 50 percent or more of these revenues to the EOBI for expansion of social security to workers in the country. Also, there is a need for development of a contribution-based pension scheme for expatriate Pakistani workers.

Finally, there is the issue of providing collective bargaining rights to workers. There was a time in the decade of the 70s when the trade union movement was beginning to take off under the first PPP government. However, this was crushed by the military regime of General Ziaul Haq.

Today, according to the ILO statistics, only 5.6 percent of workers are unionized in Pakistan and mostly in the public sector. As compared to this, the trade union density rate in China is as high as 45 percent. However, the presence of collective bargaining has had no negative impact on the phenomenal growth achieved by the country.

Overall, the clear conclusion is that the prevalence of 'decent work' is extremely low in Pakistan. Typically, workers put in long hours but are underpaid. There is substantial gender discrimination in access to jobs and in remuneration. Almost 2 million workers are bonded and 3 million children are working. 2.5 million workers have had work related diseases or injuries. The coverage of social security is very limited and the process of collective bargaining is virtually non-existent.

The vision of the new Government is to greatly expand employment opportunities. In addition, there is a dire need to ensure more 'decent work' in the country. A sizeable part of the new Ehsaas programme should be focused on achieving this objective.

(The author is Professor Emeritus at BNU and former Federal Minister)