Low-skilled or unskilled labour is considered to belong to the unorganized sector.

The organized sector is incorporated with the appropriate authority or government and follows its rules and regulations. Whereas, the GDP does not even calculate the income of the unorganized sector.

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What defines this unorganized segment?

The Ministry of Labor, the Government of India, have classified the unorganized sector under four groups:

1.     Under the terms of Occupation

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Small and marginal farmers, landless agricultural labourers, sharecroppers, bakers, ceramic workers, potters, carpenters, etc. fall under this category.

2.     Under the terms of Nature of Employment

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Agricultural labourers, non-agricultural labourers, people who migrated from backward areas, railway workers, labourers working in Road constructions and other infrastructure activities.

3.     Under the terms of Special Distressed Category

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Toddy tappers, scavengers, auto drivers, transporters in bullock carts, come under this category.

4.     Under the terms of Service Category

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Nurses, Anganwadi teachers, Housemaids, Newspaper sellers, barbers, vegetable and fruit shopkeepers, hawkers, etc. belong to this category.

Relief to the people working in the unorganized sector

It is tough to resolve the issues of the enormous volume of this category.

The government has undertaken several measures to take care of the welfare of unorganized sector.

Present Scenario

At present, the organized sector of the Indian economy is merely 10%. The other 90% of the total workforce as per the government survey consists of the unorganized sector. They do not even enjoy the necessary privileges like social security and workplace benefits.

Bill for fixing Minimum Wages for the Unorganized sector

On Aug 10, 2017, Lok Sabha introduced the Wages Bill. The bill was made for the betterment of 40 crore people in India who belong to the unorganized sector.

The bill seeks to set a national minimum wage for all categories of the unorganized sector. It provides a fixed time and method for their payment.

The Bill seeks to amalgamate four laws –

  • The Payment of Wages act, 1936
  • The Minimum Wages Act, 1948
  • The Payment of Bonus Act, 1965
  • The Equal Remuneration Act, 1976

This raises the question on which the need for labour reform is often defended.

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