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In India, unorganised workers constitute about 93% of the total workforce, which is a sizeable portion of the country’s population.[1]  The unorganised sector is an organisation owned by individuals or self-employed workers and is in the production or sale of goods or providing services of any kind. This sector is normally not regulated by governments, examples of which include street vendors, small-scale farmers, construction workers, and domestic workers. [2]


The Universal Declaration of Human Rights, which was adopted in 1948, states that “everyone, as a member of society, has the right to social security”.[3]  In India, social security laws such as the Employees Compensation Act of 1923, [4] the Factories Act of 1948, [5] the Minimum Wages Act of 1948, [6] and others were first introduced. 

The First National Commission on Labour of 1969 and The Second National Commission on Labour of 1999 both proposed legislation to govern and protect unorganised workers.[7] Dr Arjun Sengupta was appointed head of the National Commission for Enterprises in the Unorganised Sector (NCEUS), which was founded in 2004. [8]  This commission was established with the intention of acting as an informal sector advising group. Finally, the Unorganised Workers’ Social Security Act, 2008 was passed in parliament with the objective to regulate and provide welfare to unorganised workers. [9]


The Act established the National Social Security Board, State Social Security Boards, and Worker’s Facilitation Centers.[10]  It also made provisions for unorganised workers to register with the District Administration and receive a smart card with a unique identification number upon registration, ensuring that they would be eligible for benefits under the government’s various programmes. [11]

But this Act, also had its drawbacks like the term ‘social security’ is not defined under the Act which is a disadvantage for an Act that centred around delivering social protection to the workers in the informal sector. The Act defined the unorganised sector as an enterprise that is employing less than 10 workers, [12] which should be extended to include a broad spectrum of workers. Also, this Act did not address the inhumane working conditions of the unorganised sector workers and long working hours and not setting penal provisions to curb the exploitation of workers, which felt like this Act had glossed through the ground-level problems that were being felt by the unorganised workers. And perhaps the most glaring drawback of this Act was that it did not mandate the Central and State governments to introduce welfare schemes in the unorganised sector, this Act gave the power to National and State Social Security Boards to ‘recommend’ schemes to the Center and State, which thereby did not bind the public bodies to implement welfare schemes which is the need of the hour.[13]


Any individual who works in any occupation in the unorganised sector without being engaged by an employer, subject to a monthly earning of an amount as may be announced by the Central Government or the State Government, is defined as a self-employed worker under the Code of Social Security 2020.[14]  Even the word “social security” was defined as safeguards for both organised and unorganised workers that guarantee access to healthcare and guarantee a steady income, particularly in circumstances of old age, unemployment, illness, etc. [15] This Code also states that the Central Government shall establish a ‘Social Security Fund’ for the social welfare of informal sector workers. [16] Even though legislative measures have been laid down by the Parliament, there are still some drawbacks that we can witness in the Code. The Code has the same drawbacks as the Act of 2008, i.e., that this Code only gives power to the Center and States to form schemes which is a discretionary power and are not binding in any manner. It looked like some of the concerns of the Unorganised Workers’ Social Security Act, 2008 were addressed in the Code of Social Security, 2020 [17] but it is definitely not enough.


Even though it is It’s crucial to remember that even if social security measures like the Aam Admi Beema Yojana [18] and the Pradhan Mantri Shram Yogi Maan-dhan Yojana (PM-SYM) [19] have been introduced, the biggest roadblock in ensuring the social security of workers is the lack of awareness these workers have about their own rights on these schemes.

There are also other drawbacks like the lack of formal employment relationships since self-employed workers typically do not have formal employment relationships with employers and may not be eligible for the same benefits and protections as employees which can make it difficult to design social security programs that are tailored to their needs. In most cases, schemes are enacted for regular formal workers and these workers are given priority over the informal workers.[20]

There are also administrative challenges since self-employed workers typically work in a variety of industries and have different levels of income, making it difficult to designate their pay scale also self-employed people must disclose their income, maintain records, collect contributions, and apply for benefits on a more frequent basis which is a difficult task.

There also arises the issue of non-compliance. Even though benefits have been put in place for these workers, compliance with these social benefits is barely seen at the grassroots level. The lack of enforcement of these rights is a huge issue that needs to be overcome by the administration and the various stakeholders.


While the government has introduced certain schemes and Acts to regulate unorganised workers there is still a long way to go, for example, introducing measures so that both men and women workers are given the same benefits and securities, stricter regulations for minimum wages for unorganised workers so that there is consistency and these regulations have to be not just codified and ratified by the Parliament, but also there has to be proper implementation of these regulations not just in central and state levels but also in the local levels.

New regulations for the benefit of unorganised workers have to be made taking opinions from various stakeholders so that we get a broader understanding and can work more towards the expansion of their rights.

Author(s) Lichee Pattnaik (Nirma University, Ahmedabad)


[1] Unorganized Worker Ministry of Labour & Employment: Government of India. Available at: (Accessed: April 23, 2023).

[2] Facts on Social Security. International Labour Organisation . Available at:—dgreports/—dcomm/documents/publication/wcms_067588.pdf (Accessed: April 11, 2023).

[3] Article 22 of the Universal Declaration of Human Rights, 1948

[4] The Employee’s Compensation Act, 1923, No. 8, Acts of Parliament, 1923 (India)

[5]  The Factories Act, 1948, No. 63, Acts of Parliament, 1948 (India)

[6]  The Minimum Wages Act, 1948, No. 11, Acts of Parliament, 1948 (India)

[7] INDUSTRIAL RELATIONS AND LABOUR LEGISLATIONS; Indian Labour Policy: Evolution, Key Concerns, Recommendations of 2nd National Commission on Labour (no date) e-PG Pathshala – INFLIBNET Centre. Available at: (Accessed: April 23, 2023).

[8]  National Commission for Enterprises in Unorganised Sector (no date) Ministry of Labour & Employment. Available at: (Accessed: April 23, 2023).

[9] The Unorganised Workers’ Social Security Act, 2008, No. 33, Acts of Parliament, 2008 (India)

[10] Unorganised Workers’ Social Security Act, 2008, § 5, 6, 9, No. 33, Acts of Parliament, 2008 (India)

[11] Unorganised Workers’ Social Security Act, 2008, § 10, No. 33, Acts of Parliament, 2008 (India)

[12] Unorganised Workers’ Social Security Act, 2008, § 2 (l), No. 33, Acts of Parliament, 2008 (India)

[13] Luhar, D.N. (2019) “Unorganised Workers’ Social Security: Legal Appraisal And Criticisms,” Journal Of Legal Studies And Research, 5(6), pg. 72–96. Available at: (Accessed: April 11, 2023).

[14] Code on Social Security, 2020 § 2 (75), No. 36, Acts of Parliament, 2020 (India)

[15] Code on Social Security, 2020 § 2 (78), No. 36, Acts of Parliament, 2020 (India)

[16] Code on Social Security, 2020 § 141 (1), No. 36, Acts of Parliament, 2020 (India)

[17] The Code on Social Security, 2020, No. 36, Acts of Parliament, 2020 (India)

[18] Aam Admi Beema Yojana: Ministry of Labour & Employment: Government of India. Available at: (Accessed: April 23, 2023).

[19] PM-SYM: Ministry of Labour & Employment: Government of India. Available at: (Accessed: April 23, 2023).

[20] Kar, D.S. (2021) Protection of Self-Employed Unorganized Workers under the code on Social Security, 2020, SSRN. Available at: (Accessed: April 12, 2023).