4 From ‘rural labour’ to

‘classes of labour’
Class fragmentation, caste and class
struggle at the bottom of the Indian
labour hierarchy
Jens Lerche

Introduction
Employment relations in rural India have undergone major changes in recent
decades. Agriculture now requires fewer labour inputs; and the growth of the
non-agricultural sectors has created alternative employment opportunities. From
the 1990s, new rural and urban employment, often linked to migration, has
become an increasingly important income source for former agricultural labourers.
Close-knit patron–client relations between low-caste agricultural labourers and
their landowning caste Hindu employers have loosened. As pointed out by
Heyer and a number of other researchers, this has not always led to free labour
relations, but it has, by and large, signalled a change from the rural poor mainly
being ‘agricultural labour’ to their being ‘rural labour’ (Breman 1996; Byres,
Kapadia and Lerche 1999; Heyer 2000).
This chapter continues the investigation of three questions about this rural
labour: who the rural labourers are, in what kind of employment relations they
are involved today, and what kind of action is taken by and on behalf of the
labouring poor. The implications of significant divisions and segmentation among
the labouring poor as well as fluidity across some categories of labour will be
examined. It will be argued that it is time to conceptualise these labourers
simply as ‘labour’, with no ‘rural’ or ‘urban’ prefix, because social segmentation
is more important than site. This study focuses on the segmentation of low caste
labour. It will be argued that the combination of segmentation and fluidity
within the segments identified here impedes work-based social action while
making other types of social action, sometimes political and along caste lines,
both possible and necessary for the labouring poor.
These issues are wide-ranging, and this contribution can only point out some
major aspects and tendencies within the field. Three limitations of the argument
need noting at the outset. First, while it is organised around a perspective of
class analysis, it concentrates on the ‘labour’ side of class relations and does
not provide a full class analysis of Indian society, let alone an analysis of ‘capital’.
Second, while it seeks to break down the strict rural–urban distinctions regarding
 From ‘rural labour’ to ‘classes of labour’ 65
labour, its main concern is the labour that used to be seen as rural. This is
because the referents of the argument are a trajectory of studies starting from
an agrarian point of departure. Third, there are many, often contradictory,
tendencies between and within the regions of India which are acknowledged,
but the main contribution of the essay is at the All-India level.
Empirically, this research draws on recent case studies as well as statistical
data collected by the Indian National Sample Survey Organisation (NSSO), and
the impressive analysis of these data by the Indian National Commission for
Enterprises in the Unorganised Sector (NCEUS). It is organised into three sections.
The first section identifies the labouring classes in India and the segmentation
of these classes into different types of employment and degrees of self-
employment. This also involves a methodological/theoretical discussion of how
to conceptualise ‘labouring classes’ in India today. The second section argues
that employment is segmented along social lines. The emphasis here is on caste,
especially on labour relations involving low-caste labour. The third part focuses
on pro-labour actions and movements. It is shown that labouring groups at the
bottom of the employment hierarchy are more likely to seek redress outside the
immediate labour relation through central policies and sometimes through new
types of unions, but also through caste – or locality-based – political organisations.
The article concludes with a discussion of these struggles in relation to the ways
in which labour relations and the labouring classes are structured.

The Indian labouring classes

Any analysis of labour in India must begin with a clarification of the concept of
‘labour’. In major parts of the late-developing world including India, the kind
of capitalism that has developed has not led to the universalisation of ‘doubly
free’ labour (‘free’ to sell their labour power and ‘freed’ from ownership of the
means of production). The development of class-based categories appropriate for
the analysis of the actually existing class relations is a long-standing political
and analytical challenge. In this context, recent work by Bernstein is relevant.
Bernstein’s point of departure is that capital today is so dominant that it shapes
social and thus class relations in a very direct way, even if not expressed through
the dominance of the ‘classic’ capital–labour relations. He suggests a new
concept, ‘classes of labour’, which includes both classic wage labourers and those
who depend indirectly on the sale of their labour power. With this concept he
encompasses all those who ‘have to pursue their reproduction through insecure
and oppressive – and typically increasingly scarce – wage employment and/or a
range of likewise precarious small-scale and insecure, ‘informal sector’ (‘survival’)
activity, including farming; in effect, various and complex combinations of
employment and self-employment’ (Bernstein 2008: 18). Classes of labour thus
can include those who possess some means of production, but who nevertheless
share with wage labourers the overall position of being exploited and oppressed
– and who, indeed, may alternate between being wage workers and small-scale
petty commodity producers, seasonally or throughout their lifetimes.1
66 Jens Lerche
Rural employment and development
The ‘classes of labour’ concept provides a useful framework for understanding
the fluidity of labour relations for Indian workers of rural origin. This section
seeks to identify the labouring classes in India and their segmentation into different
types of employment and degrees of self-employment. Several qualitative
studies have lent support to the Ministry of Finance’s study of agricultural debt
(Government of India 2007a): at present, more often than not, agricultural returns
are insufficient to keep agricultural labourers and owners of small plots of land
remuneratively occupied throughout the year. It is increasingly common for
healthy, able-bodied male, rural labourers to migrate seasonally to take up slightly
less poorly paid jobs, or jobs providing them with income during the lean
agricultural season, and then to return to their villages for harvest work. This
migratory work might be agricultural and non-agricultural, or a mixture, depending
on the season and on specific local patterns of migration. It may involve self-
employment or wage employment. In many households women, together with
young and old men, stay in the village throughout the year. They do any available
paid work for the landowners and tend any livestock they may possess (e.g. chickens
or a single cow), undertake semi-skilled craft activities such as basket-making and
rope making for survival, or cultivate (very) small plots of land. In the poorest
households even the female members, and often the children of these house-
holds as well, migrate. At the very bottom of the labour hierarchy, some households
are forced to take out loans during the slack season from labour contractors of
migrant labour, or from local landowners, against their future labour input, and
so become bonded labourers. This does not necessarily constitute lifetime bondage.
Households enter into bondage in very lean years, or when additional expenditure
cannot be met (relating to disease, life cycle rituals, etc.). Some households work
their way out of it, to become ‘free’ casual labour again. Geographically, the poor
central to eastern parts of India2 and poverty pockets elsewhere serve as reservoirs
of seasonal migrant labour for the rest of the economy (Breman 2007; Breman
and Guerin 2009; Guerin 2009; Lerche 1999, 2007; Pitcherit 2009; Srivastava
2005a, 2005b).
The fluidity and variety of positions occupied by labour and labouring
households during the year and during a lifetime are important; but so too are
the constraints or limits to this fluidity. These limits are best revealed by looking
at the overall employment trends in the country. Starting with the sectoral employ-
ment pattern, India is still predominantly an agricultural society in employment
terms, but less so than it used to be. In the first couple of decades after Inde-
pendence, more than 70 per cent of the economically active population worked
in agriculture and this remained fairly stable until the 1970s. Since then, the
proportion of the working population in agriculture has fallen to 57 per cent
(Ramaswami 2007: 48).3 In some states, including those with a highly productive
capitalist agriculture and/or a strong non-agricultural economy, the share is
significantly lower.4 The importance of non-agricultural employment for
households working in agriculture is also high.5
 From ‘rural labour’ to ‘classes of labour’ 67
India’s agrarian capitalism is well documented and taken as given here. It is
less commonly acknowledged that during the last fifty years there has been
a significant decrease in land sizes. Between 1982/1983 and 2003 there was a
dramatic and accelerating increase in the proportion of farmers owning less than
one hectare of land. Today, more than 60 per cent of all landowners fall into this
category of ‘marginal farmers’. Few, if any, accumulate capital through their
agricultural activities. Most marginal farmers are best characterised as de facto
wage workers who receive a subsidiary income from the plots of land that they
own: more than half of the income of marginal farmers is wage income (NCEUS
2008: 4, 34).6 These marginal farmers are likely to belong to the ‘classes of
labour’ as defined above, together with most by far of the landless rural dwellers.
Agricultural labourers are either landless or are drawn mainly from the ranks
of marginal farmers. According to NSSO figures, the proportion of the
economically active population in agriculture whose main income is from
agricultural labour hovers at around 40 per cent, with significant swings up and
down (from 40 per cent in 1993/1994 up to 42 per cent in 1999/2000 and down
to 36 per cent in 2004/2005) (NCEUS 2007: 111–14).7
The diminishing importance of agriculture is not just due to the growth of
other sectors; agriculture itself is also in crisis, after a decade of the lowest
growth rates in agriculture since Independence. During 1994/1995 – 2004/2005,
its annual growth rate was only 0.6 per cent (as against, in most years since
Independence, between 2 per cent and 4 per cent). The crisis in agriculture is
well acknowledged by Indian authorities and is often seen as an outcome, at
least in part, of the specific liberalisation policies applied to Indian agriculture
from 1991 onwards. The agrarian crisis seems to have intensified already existing
processes of land miniaturisation and labour-shedding. Economic growth in the
non-agrarian economy from the early 1990s onwards has also not had strong
linkages to agriculture (Chandrasekhar 2007; Jha 2006; NCEUS 2008).
However, the aggregate picture disguises very different trends at state and
local level. The crisis is much deeper in some parts of the country than in
others. States with high growth rates from 1994/1995 to 2004/2005 include the
classic Green Revolution states of Punjab, Haryana and Andhra Pradesh, as well
as other agriculturally productive states such as West Bengal and, in recent
years, Gujarat and some less-developed states. In the period 2003/2004 to
2006/2007, Chhattisgarh, Madhya Pradesh, Orissa and Rajasthan have witnessed
remarkably high growth rates (Chand, Raju and Pandey 2007; Government of
India 2007b, 2008). The old Green Revolution states are also more dominated
by bigger landowners than most other Indian states, pointing to the crisis for
small-scale farmers being even greater than shown by the average figures, and
to the possibility that large-scale modern agriculture is doing a good deal better
than the story told by the All-India averages (NCEUS 2008: 81).

The informal economy and classes of labour

A relative decrease in agricultural employment and the squeezing out of the
least-profitable farmers can signify healthy capitalist development. The problem
68 Jens Lerche
for labour arises when job growth elsewhere is insufficient to provide decent
alternative employment. In India, most of the economically active population
works in the unregulated or informal economy. Enterprises (including farms)
employing fewer than ten people are in practice exempt from labour laws and
other regulations. In addition, formal-sector enterprises employ an increasing
part of their workforce as contract or casual labour, thus avoiding labour laws
and regulations (Singh and Sapra 2007). In line with ILO definitions, these
unregulated, unregistered and unprotected enterprises and jobs, both wage
employment and self-employment and both agricultural and non-agricultural,
constitute the informal economy.
Workers in the formal economy are, in principle, protected by labour law and
benefit from social protection entitlements such as sick pay and pensions. They
tend to be paid a living wage and to have regulated terms and conditions of
work. Informal economy workers have none of these benefits. Even when
employed in formal-sector enterprises they will be unprotected, poorly paid and
have no social security. In smaller informal enterprises they may also face ruthless
oppression which can include physical violence (Breman 1996).
The informal economy accounts for 92 per cent of all economically active
workers in India. In the non-agricultural sectors, 72 per cent work in the informal
economy, including nearly half of the employees working for formal-sector
enterprises in casual contracts and informal labour relations. The employment
growth of the 1990s was not only historically low; it was also limited to the
informal economy (NCEUS 2007: 4), not the least due to government initiatives
which formally extended the reach of the unregulated economy.8 In fact, the
increasing informalisation of labour in India forms part of a long-lasting labour-
unfriendly development strategy. From the mid 1970s onwards, the Indian
government moved decisively towards what Sundar calls ‘hard state policies’
and ‘authoritarian corporatism’ (Sundar 2005). Ever since then, employers and
consecutive governments have attempted to discipline labour and restructure
production to achieve maximum flexibility and a docile and cheap workforce.
Government support for the private sector, anti-union policies and activities by
companies have weakened organised labour, and more explicit liberalisation and
informalisation policies from the early 1990s onwards have further strengthened
the anti-labour hand (Banerjee 2005: 123–5; Datt 2002; Harriss-White and Gooptu
2000: 107; Lerche 2007).
Moving to a more detailed analysis of the informal economy, it is useful to
establish a hierarchy of occupational categories. The influential WIEGO network
(Women in the Informal Economy; Globalizing and Organizing) suggests that,
moving from low to high earnings, occupation types form a hierarchy: from
industrial outworkers/home workers to casual wage workers, own account
operators (self-employed), informal employees and informal employers (Table
4.1). Women are predominantly found at the low end of this pyramid, while
men dominate towards the top (Chen 2008: 21). This is a good starting point.
Exploring the classes of labour, the focus here will be on employees and self-
employed labour. It is analytically useful first to separate wage labour from the
 From ‘rural labour’ to ‘classes of labour’ 69
Table 4.1 Occupational hierarchies in India

Income and Occupational categories

power
Wage labour Self-employment

High Wage labour with formal Self-employed Self-employed with

contract in formal economy with strong employees
asset base
Informal-sector regular
wage labour

Casual/unprotected wage
labour: manufacturing, services

Formal-sector outworkers/
homeworkers

Casual/unprotected wage
labour: agriculture
Survival Unpaid family
Low Bonded labour self-employed worker
Source: Developed from Chen (2008), NCEUS (2007: 4–7) and Bernstein (2008).

self-employed, and second to keep in mind the fact that many labourers circulate
between wage labour and (often agricultural) self-employment, be this seasonally
or within a lifetime, and that households may have members straddling the two
categories.
The wage labour hierarchy in Table 4.1 covers a wide span of labour relations,
ordered by levels of protection of labour, and remuneration. This hierarchy is
also a hierarchy of powerlessness, ranging from bonded labour, tied to specific
employers through interlocked credit, subordinate social status and labour
obligations on the one hand, to more free casual labour relations on the other.
The occupation hierarchy encompasses, at the bottom, bonded labour, at the top,
wage labourers in the formal sector on proper contracts and protected by labour-
related legislation. In between, there are categories such as casual agricultural
labour, labour working in informal enterprises, outworkers from formal-sector
enterprises and casual workers in formal enterprises. Among the self-employed,
there are, in turn, two interrelated hierarchies. One relates to scale and ranges
from survival-level self-employment by those who have been unable to find
work as wage labour, to those who are self-employed with a strong asset base
(e.g. consultants, service providers and capitalist farmers). The other relates to
status differences among the self-employed, distinguishing between those self-
employed who run a business on the one hand and the household or family
members who work for them unpaid on the other.
Figure 4.1 presents the hierarchy of occupations in the labouring classes in
India, based on NSSO data. More than half the working population are self-
employed; even in the non-agricultural sectors, just under half are self-employed.
70 Jens Lerche

Self-employed,
300 formal economy

Non-agricultural self-
250 employed, informal
economy
Agricultural self-
employed, informal
200 economy
Million of workers

Labour, formal
economy
150
Non-agricultural
labour, informal
100 economy
Agricultural labour,
informal economy
50
Formal sector
outworkers

0 Bonded labour
Wage labour Self-employed

Figure 4.1 Employed and self-employed categories as a proportion of all workers

Source: NCEUS (2007), from NSSO 61st Round 2004–2005; and, for bonded labour, own minimum
estimates (Lerche 2007).
Note: ‘Agricultural labour, informal economy’ adjusted downwards by 1.5 million as 10 per cent
of bonded labourers are estimated to be agrarian (division of bonded labour into agricultural and
non-agricultural, own rough estimate). ‘Non-agricultural labour, informal economy’ adjusted down-
wards by 21.7 million: 13.5 million non-agricultural bonded labourers, and 8.2 million home workers
(1999–2000 NSS figures, which are the most recent figures available).

The latest figures (from 1999/2000 to 2004/2005) show that employment growth
is mainly driven by self-employment, whereas in the 1990s it was generated by
casual labour (Bhalla 2008). It is likely that the data overestimate the number
of self-employed: most outworkers/home workers are probably registered as
self-employed even though this category is better understood as a type of piece-
rate wage labour. Outworkers/home workers exist in many sectors, including
bidi making (a country cigarette) and garment production (NCEUS 2007; Mezzadri
2008). It is also not known if the NSSO has counted agricultural workers who
are contracted and paid for the harvest of a crop as self-employed workers or
as employees. Nevertheless, self-employment is clearly important, even if the
precise figures and at least some of the registered growth in self-employment is
disputed.
In the occupational hierarchy for wage labour (column one), wage labour
employment in the formal economy has highest earnings. This is followed by
informal economy employment. Statistical data on average wage earnings and
 From ‘rural labour’ to ‘classes of labour’ 71
poverty levels as well as case studies of household incomes show that on
average non-agricultural labour is slightly less poorly paid than agricultural
labour, so non-agricultural labour is set above agricultural labour in the hierarchy.9
The subcategories of ‘outworkers’ and ‘bonded labourers’ have the worst pay
and conditions. The numbers of labourers listed as belonging to both these latter
categories are likely to be underestimates.10 Other occupational categories are
not enumerated. This includes the important and growing cross-cutting category
of seasonal migrant labour (both agricultural and non-agricultural). Reckoned
to tally at around 30 million (Srivastava 2005b), they form one of the most
disempowered categories of labour. Srivastava estimates that about half are
hired through labour contractors, a relationship which often involves advance
payments, extreme conditions of work, sometimes physical abuse and very poor
and often irregular pay. Many, if not most, migrants working through contractors
are bonded labour, with terms and conditions of work, and pay, at the lowest
end of the scale, as shown by several case studies, e.g. Breman (2007); Guerin
(2009); Guerin et al. (2009); Srivastava (2009); Prakash (2009). It needs noting
that child labour is not included.
Turning to the hierarchy of the self-employed (column 2), while formal-
economy self-employed has highest and most secure earnings, the rest of the
vast informal economy is difficult to differentiate. Both agricultural and non-
agricultural categories cover a vast range, from surplus-producing self-employed
and employers to those engaged in survival activities and unpaid family labour.11
It is also not known how great a proportion of the self-employed have subsidiary
income from wage employment, and vice versa.
Within the labouring classes, there is a straightforward relationship between
type of employment and poverty levels. Indian poverty remains abysmally high.
According to official figures, in 2004/2005, 28 per cent of the population was
below the poverty line, which is set at a near-absolute-minimum calorie intake
purchasable with Rs.12 per person per day.12 In 2004/2005, a staggering 77 per
cent of the population were below the Rs.20-per-day line (US$2 in purchasing
power parity) (NCEUS 2007: 6; Sengupta, Kannan and Raveendran 2008: 51).
Most poor people belong to households with at least one working member.
In keeping with the hierarchy of labour outlined above, the incidence of poverty
in the unorganised economy is nearly twice as high as in the organised economy,
and higher in agriculture than elsewhere (NCEUS 2007: 24). No official poverty
figures exist for outworkers and bonded labourers. However, outworkers are
employed because they are cheaper and more flexible than workers based inside
firms, and they are thus likely to be poorer. Labour tends to be driven to bonded
labour by abject poverty.
Workers below the poverty line are more or less evenly split between the
self-employed and the casual labour category, with slightly more being self-
employed. Below US$2 a day, self-employed workers dominate in absolute
terms while more self-employed than casual labour are well-to-do in relative
terms.13 Among the self-employed, it is not possible to establish a poverty
72 Jens Lerche
hierarchy in relation to the different types of self-employment. It is likely that
those for whom self-employment is due to the unavailability of full-time wage
employment will be poorer than labour in wage labour relations. Examples of
occupation groups at the foot of the column include basket makers/bamboo
product makers, tendu leaf collectors, street vendors, cycle rickshaw pullers, rag
pickers, bidi rollers and potters (Lerche 1993; NCEUS 2007: 51). Many are
disguised wage labourers.
The upper part of the hierarchy of work of the labouring classes is rigid in
the sense that it is near impossible for poor people to get access to secure
employment in the formal economy or, unless they possess productive assets,
to enter the better-off/accumulating self-employed strata. However, there is a
great deal of fluidity at the lower end of the labour hierarchy, and between the
two main hierarchies, during the life cycle of a labourer, seasonally, and within
a household.

Social segmentation among the labouring classes

It is well known that Indian labour markets are segregated along lines of gender,
location, religion, ethnicity and caste (see, for example, Harriss-White 2004).
Here, the focus is on the caste and ethnic segmentation of the labour market.
Groups at the bottom of the caste hierarchy consist of the ex-untouchable
Scheduled Castes (SCs, or Dalits), 20 per cent of the population, and the Scheduled
Tribes (STs, or Adivasis), 9 per cent (NSSO 2007a: 19). Both groups are greatly
discriminated against socially, culturally and economically; something which is
reflected in practically all available indicators.14 They have substantially higher
poverty rates than other groups, lower literacy rates, higher infant mortality
rates, less access to electricity and so on (Planning Commission 2005; Sengupta,
Kannan and Raveendran 2008: 52).
Adivasis are still geographically concentrated in their historic strongholds of
the states of the Central Indian Plateau and in the north-eastern states of the
country, but there are also Adivasi groups in West and South India. Many
Adivasi groups in North-East India have been better able to resist the destruction
of their systems of production than the Central Indian groups and tend to be
somewhat less poor (Rath 2006). The Adivasis are much more rural than other
groups, and they often have access to forest produce and plots of poor-quality
land for cultivation. They are also more likely than caste Hindus to undertake
wage labour. Throughout India, the Dalit castes have performed menial, degrading
and underpaid tasks for the caste Hindus, often in tight-knit but oppressive
patron–client relations. The Dalit population is most preponderant in the northern
and north-western Indian states, and in Tamil Nadu in the south. They are also
more evenly distributed across the rural–urban divide (NSSO 2007a: 20). Both
rural and urban Dalits are more likely than any other group to work as wage
labourers, and they are less likely than others to be self-employed.
Some Adivasis and Dalits are employed within the government sector through
affirmative-action programmes, but nearly all Dalit/Adivasis work in the informal
 From ‘rural labour’ to ‘classes of labour’ 73
economy: their position in the overall caste hierarchy is an important employment
segregator.15 Within the informal economy, Adivasis tend to be the lowliest
employees, followed by Dalits.16
Together these two groups form the worst-off segment, with more informal
economy Dalit/Adivasi labour below the poverty line than labour belonging to
other social groups.17 Dalits work mainly as unskilled and casual labour, being
excluded from skilled work, except those skills and trades that are seen traditionally
as polluting and hence left to them – for example carcass and leatherwork – as
shown by case studies of employment and labour markets (Breman 2007; Mosse,
Gupta and Shah 2005). Within enterprises, a caste hierarchy of labour can often
be found, with skills, responsibility, status and pay tending to follow caste lines.
It is well documented that Dalit/Adivasi workers are often paid less for the same
work as others, and have worse conditions of work (Thorat 2008: 36–7).
Most bonded labourers are Adivasis and Dalits. Migrant workers of low-caste
backgrounds are often actively sought out to bond, as they are easier to control
and procure on the cheap. Bonded labour dominates in the brick kiln industry,
and is common within other sectors such as stone quarries, construction and
agricultural labour, especially in harvesting operations. Most bonded labour is
from the labour surplus regions of Central India, but disempowered groups
of Adivasis and Dalits elsewhere also do debt work (Prakash 2009; Guerin
et al. 2009; Picherit 2009; Roesch, Venkatasubramaniam and Guerin 2009;
Srivastava 2005a, 2005b).

Pro-labour development: policies, class struggle and

movements
This section looks at the various types of movements and policy initiatives by
and for the labouring classes. It traces how old and new labour organisations
have sought to improve conditions and how top–down pro-labour policy initiatives
have aimed to influence the conditions of labour without confronting employers
directly. It assesses the extent to which such initiatives have benefited those at
the bottom of the labour hierarchies. In addition, it is argued that a number of
political movements including low-caste political parties and the armed Naxalite
insurgency movements active in many tribal areas are also influencing the
conditions of the labouring classes, by taking up issues of importance to livelihoods
and social oppression, even if these issues are outside the standard arena of
labour relations.

Unions and government policies

According to official figures in 2002, only 8 per cent of India’s workforce was
unionised (Das 2008: 975). Unionisation is at its lowest among casual (informal-
ised) labour; and somewhat less extremely low among urban self-employed
workers; while regular (formal) workers have unions present in nearly half of
their workplaces (NSSO 2007b: iv, 76).18 Classically unions organised only
74 Jens Lerche
formal-sector workers, but since the early 1990s all major unions have taken on
board the need to organise informal economy workers, with some, limited, success
(Sundar 2008: 1069). A leading scholar of labour unions in India describes
their standard organising template as involving four steps: a) create special units
in the central union to organise informal-sector workers; b) provide legal aid
to informal-sector workers; c) demand the constitution of a tripartite council for
informal-sector workers and social security measures for the sector; and d)
organise demonstrations and hunger strikes to press home the demands (Sundar
2006: 903). The focus appears to be on establishing a regulatory framework for
conditions of work and pay, and promoting welfare issues, rather than undertaking
more classical grassroots union activities concerning day-to-day conditions of
work and pay within enterprises.
By the early 1990s, other organisations were also active in the field. They were
often associations which combined aspects of NGO and charity work with union
activities for informal economy workers, which might have links with international
organisational networks (e.g. StreetNet, WIEGO). They include organisations
for the self-employed in the informal economy (e.g. the Self-Employed Women’s
Association (SEWA) and the National Alliance of Street Vendors (NASVI)),
as well as slum movements and new unions (such as the fish workers’ union,
the National Fish Forum (MFF), and the Adivasi forest workers’ association
(VIKALP)). In 1995, a coalition of informal-sector unions, the National Centre
for Labour (NCL), was set up, providing an umbrella for many of them (Bhowmik
2008; Chowdhury 2003; Sinha 2004; Sundar 2006).
Most of these new organisations focus on welfare issues: night shelters/housing,
education, health, pensions, etc. Some also provide micro-credit to self-employed
people, or help to organise cooperatives of the self-employed and wage workers.
There is less emphasis on the ‘classic’ union issues relating to terms and conditions
of employment (Bhowmik 2008; Sundar 2006). The new organisations often
focus on government policy. They campaign for better welfare policies, and they
help informal labour to access government schemes and programmes, with some
success (Mosse, Gupta and Shah 2005; Agarwala 2006).19
There is some tension between the classic labour unions and these new
organisations, with the unions resisting encroachment on what they see as their
territory, by organisations many of which are not membership based, while
others are not restricted to wage employees (Sundar 2006). However, they share
a core strategy, not only with each other but also with the left parties in India,
intellectuals on the left, and the ILO in India and internationally: namely, to put
pressure on the government to regulate crucial aspects of the livelihoods of
informal labour. The struggle against employers has been replaced by a struggle
to secure improvements from government.
A good deal of legislation exists which, if implemented, would lead to major
improvements in the livelihoods of informal labour: the Minimum Wages Act,
the Inter-state Migrant Workmen Act, the Contract Labour System (regulation
and abolition) Act, the Bonded Labour System (abolition) Act and the Factories
Act, to list but a few of the most important laws supposed to regulate labour
 From ‘rural labour’ to ‘classes of labour’ 75
relations. However, the focus of these struggles has been on legislation and
government initiatives to improve other aspects of livelihoods. The reason for
this is that, given the present weakness of labour in relation to capital and the
near impossibility of taking successful action at the workplace, to seek pro-
labour government initiatives in areas not directly challenging capital is the best
way forward. In this regard, the Construction Workers Welfare Cess Act (1996)
is a celebrated piece of legislation. It set up a welfare fund for construction
workers and their families, housing loans, children’s education, providing support
to accident victims, etc. It is funded by a cess/tax of 1 per cent of the construction
cost, payable by construction companies employing ten or more workers and by
projects costing more than a million rupees. While it remains far from implemented
in most parts of India, there has been some progress in Kerala, Gujarat, Tamil
Nadu and Madhya Pradesh (Anonymous 2008a; Agarwala 2006: 433). Workers
in other industries such as bidi rolling benefit from similar legislation (Agarwala
2006). However, a case study of the bidi industry shows that only around 30
per cent of formally registered workers are eligible to access the welfare fund
and that in order to be allocated resources from the fund labourers often have
to pay NGOs a processing fee. Moreover, people other than bidi workers appear
to receive benefits from the fund, illegally (Madhavi 2006).
Some Central Indian governments have been more susceptible to pro-labour
pressure than others. In 2004, the Congress (I) party formed a government which
was dependent on the votes of the left parties. In general, the government continued
the existing non-labour friendly policies, but in a few areas some pro-labour and
pro-poor initiatives have been taken. The National Rural Employment Guarantee
Act (NREGA) passed in late 2005 has been the most important so far. The
NREGA guarantees a hundred days of manual employment per rural household
per year, paid at the statutory minimum wage (which is very often higher that
the actual daily wage paid to rural labourers). The programme has gone from
covering a third of all districts in India in 2006/2007 to more than half in
2007/2008, to the whole of India in 2008/2009. Unsurprisingly the programme
does not run smoothly, with money being siphoned off to intermediaries in many
places. Nevertheless, according to official figures it managed to provide on average
forty-three days of work to all households who demanded work in 2006/2007.
While this is a good first step it has been very unevenly implemented across
regions and states. The four states/groups of states which provided most days of
work were Rajasthan, Madhya Pradesh, Chattisgarh and the north-eastern states
(Dreze and Oldigez 2009; Mehrotra 2008: 27–8). This geographical concentration
is interesting as, apart from Rajasthan, these are some of the states with large
Adivasi populations. Altogether 37 per cent of the work went to Adivasis and
33 per cent to Dalits according to official figures (Press Information Bureau 2008).
(Forty per cent of work under the NREGA went to women.)
The implementation of the NREGA is not only a technical–bureaucratic issue.
The employment guarantee has also become a new battleground, with local
movements and activists campaigning for its proper implementation. Some state
governments are not engaging much with the programme, while in other cases
76 Jens Lerche
funds are siphoned off to contractors. Proper NREGA implementation would
challenge local economic interests directly (contractors, corrupt government
officials, employers paying very low wages) and would challenge employers in
general through tightening the labour market for all workers including Adivasis
and Dalits. Unsurprisingly, several outspoken NREGS activists have been
murdered (Anonymous 2008a, 2008b, 2008c; Khera 2008).
Another piece of legislation to which much campaigning has contributed is
the Unorganised Sector Worker’s Social Security Bill which was passed in a
watered-down, non-mandatory form in 2008 (see Jhabvala 2005; NCEUS 2006).
One of the goals was to establish welfare funds for all informal labour, but the
bill that was finally passed is unlikely to succeed in this (Rajalakhsmi 2009).20
Welfare funds are very much in line with present ILO policies (ILO 2004).
However, there are also clear limits to what can be achieved through this approach,
even if such funds were administered properly. Instead of dealing head-on with
the ongoing informalisation of work, they provide a way of making informalisation
and casualisation more palatable, by providing a basic social security net for the
working poor. They also do not deal with conditions of work, nor abominations
such as bonded labour. This fits well into the present union strategy of conceding
defeat on the bigger issues, in order to achieve at least some improvements for
labour. However, even this limited goal has hardly been achieved with the
Social Security Bill.
The Indian trade unions’ strategy resembles that of labour unions internation-
ally. Throughout the recent decades of neo-liberal policies, organised labour has
lost positions and struggles across the board, and has become significantly
weakened, as ‘labour-unfriendly regimes’ have been established (Silver and
Arrighi 2000). Unions have moved away from confrontations with individual
employers, towards seeking to achieve goals through political campaigns, legis-
lation and high-level agreements, often centred on the ‘Decent Work’ campaign
by the International Labour Office (ILO) (ILO 1999, 2004; Schmidt 2007). The
‘Decent Work’ agenda is also a referent in the Indian context, cited by academics
and unions alike.

Naxalites and caste based movements

The conditions of Adivasi and Dalit workers encompass other issues than the
labour market and welfare issues discussed above. The transformation from pre-
capitalist productive activities to present-day conditions has been painful for the
politically disempowered Adivasis. Their livelihoods have been forest-based,
relying on common property resources and free access to forest produce resources,
both for own consumption and for sale to traders. This way of making a living
was already being undermined during colonial times. Parts of their lands were
gradually taken over by caste Hindus and non-tribal traders profited from their
disempowered condition (Bailey 1957). Since Independence these developments
have been exacerbated by major development initiatives utilising Adivasi lands
for the benefit of other social interests in India – for example large-scale mining
 From ‘rural labour’ to ‘classes of labour’ 77
exploiting the rich mineral resources in parts of their lands, the building of
hydroelectric and irrigation dams, and the use of hill tracts inhabited by Adivasis
as military test ranges. One estimate cited in a recent government report is that
between 1947 and 2004, 24 million Adivasis and 12 million Dalits have been
displaced by such projects. The discrepancy between the level of investment in
such projects and the disregard for the often near-starvation conditions affecting
sections of the local population speaks volumes about existing power relations.
Judging from government-approved plans, the creation of new special economic
zones will encroach even further on their lands in the coming years (Banerjee-
Guha 2008; Planning Commission 2008; Rath 2006).
Many Adivasi households still rely in part on forest produce but, as outlined
above, they have also become wage labourers, often as seasonal migrants to the
more developed parts of the country. To a lesser degree, they have also taken
up self-employment outside their forest crafts and trades. Individuals may be
engaged in different income-earning activities in a yearly cycle, or during a life-
time; households may have several income strands to their bow and communities
are engaged in a variety of informal labour activities. Underneath such tactics
is the disempowerment which has allowed the encroachment onto Adivasi land,
discrimination in the labour market and little by way of government services in
many Adivasi areas (Rath 2006).
Several ‘mainstream’ political movements and government policies aim to
improve the livelihoods of Adivasis. However, given the poor track record
of mainstream politics with regard to pro-Adivasi development, it is unsurprising
that the most effective movement has been the Naxalites, a set of armed Maoist
organisations. They control large tracts of mainly Adivasi land in the states of
Bihar, Jharkhand, Orissa, Chhattisgarh, Madhya Pradesh and Andhra Pradesh –
that is, on and around the Central India Plateau. Naxalite dominance is not without
its own problems; the movement is undemocratic internally and its rule is
dictatorial. It is said to be corrupt and metes out summary justice. Its overall
political programme is vague, but it has succeeded in a de facto transfer of some
government-owned land to people (following its slogan ‘Land to the Tiller’) and
in its core areas it has ensured the existence of decent welfare systems – facts
acknowledged by a recent official report (Planning Commission 2008). It is only
logical to find that the struggle led by the Naxalites against their general
disempowerment in, and exclusion from, mainstream society may be as important
to the Adivasis as government programmes such as the NREGA.21
For Dalits, labour relations are not much better than those experienced by
Adivasis. Dalits rarely have land or common property rights and, like the labour
relations of the Adivasis, theirs are underwritten by extreme social and cultural
oppression. Most recently, their struggle against social oppression has been led
quite effectively by the low-caste North Indian party Bahujan Samaj Party (BSP).
The political strength of the BSP has led to social changes and some improvements
in wages and conditions of work in those parts of North India where local
grassroots movements have been able to reap the benefit of their high-level
political support. For example, during the late 1990s the BSP government in the
78 Jens Lerche
state of Uttar Pradesh dealt effectively with local atrocities against Dalits. While
the BSP did not deal with labour relations directly, tangible results were achieved
by attacking social oppression (Lerche 1999).

Everyday resistance and local labour struggles

Amidst the policy agenda-setting and armed struggles, the local-level ‘everyday
resistance’ against oppression and struggles for higher wages should not be
forgotten. For some time the struggles of Adivasi and Dalit rural labour have
been documented (see, for example, Byres, Kapadia and Lerche 1999). It has
also been pointed out that even low-caste bonded labour, which is arguably the
weakest of all classes of labour, has some bargaining power. Given that they
tend to be hired by labour contractors, and not by the actual employer, much of
their bargaining relates to what the contractor has to offer, namely as large an
advance payment as possible. Labourers also argue that it is important for them
not to stay with the same employer year on year as that would make them seem
‘docile’ (Guerin 2009; Pitcherit 2009). Prakash points out that sometimes labour
contractor and labourers tacitly work together to raise wages; the contractor would
benefit from this as well. Bonded labourers may also seek to organise themselves
in unions, although this may lead to their dismissal (Prakash 2009). The cost
arising from taking action is also highlighted by Bhowmik (2009) who reports
on a case in the tea plantation sector where migrant Adivasi bonded labour took
strike action. However, while local labour achieved results through this action,
the migrant labour failed. The difficulties involved in collective action at this
level are obvious, but so also should be the fact that collective action involving
even the most disempowered workers can and does take place.

Conclusion
India’s labouring classes have not benefited much from the transformation of
the Indian economy away from agriculture. Already, research in the 1990s
showed that the old dependency relations of rural labour and marginal farmers
on dominant social groups in the countryside had loosened. However, for most
of the labouring classes this dependence has been replaced with precarious
informalised wage labour or survival self-employment (or combinations), while
the income from farming marginal plots has dwindled. Government and capital
have rolled back the positions of organised labour and have succeeded in extending
the fragmentation of labour as well. This has been achieved through the segmenta-
tion of the labouring classes. This segmentation is not primarily along the
rural–urban divide. Instead, it is organised through types of employment and/or
self-employment and according to social status categories, of which the division
between the ex-untouchable Dalit, the Adivasi groups and the rest of caste
Hindu society is one. At the same time, the labouring classes are in internal
flux, with individuals, households and communities straddling several employment
categories at the foot of the labour hierarchies with little chance of moving up
 From ‘rural labour’ to ‘classes of labour’ 79
the hierarchy unless they acquire assets, which is rare. Both the segmentation
and the fluidity in the labour classes make it harder for workers to achieve
improved terms and conditions of work and pay. Under these conditions labour
action against employers is much less common than it used to be – let alone
successful labour action.
The strategies of the new unions have responded partly by acknowledging
the importance of the broader ‘lifeworlds’ of the labouring classes, and by
including issues such as housing, education, health and pensions in their fields
of activities. They have also moved the activities to the level above the individual
employer, seeking to establish labour-related rules and regulations at sector and
state level, and seeking to engage government in pro-labour reforms in areas
that do not directly challenge its informalisation strategy. These policy changes
are in line with policies recommended by organisations such as the ILO and the
international trade unions, which now argue explicitly that the old direct
confrontational policies by the unions against the employers have outlived their
usefulness.
There is, however, an important political space with regard to labour activities
which directly addresses employers – and also those on whom many of the
formally self-employed depend, such as larger traders etc. The era of major
strikes might be over, at least for the moment, but everyday resistance and local-
level actions still take place, even involving the most depressed segments of the
labour force, with impacts on the conditions of the labouring classes.
Indian government policies such as the NREGS and a proper social security
scheme could indeed improve the welfare of labourers in India. The NREGS
might even succeed in tightening the labour market somewhat, and through that
raise the stakes in labour negotiations. That, however, would require the legislation
to be properly implemented. There is no reason to believe that this will happen
easily. While electoral politics may lead political parties to propagate such policies,
it is unlikely that they will do much to ensure their implementation if opposed
by powerful interests at state or district level. The non-implementation of pro-
poor policies has been the prevailing pattern since Indira Gandhi proclaimed her
‘war against poverty’ in the 1970s, and still depends on the balance of power
at national, regional and local levels.
The status segmentation such as that between Dalits, Adivasis and other
segments of the labouring classes serves only to keep these groups locked into
the worst kinds of work. It is based on a segmentation of ‘lifeworlds’, in which
all aspects of their lives are affected by social and cultural oppression. It is
hardly surprising that Dalits and Adivasis treated as ‘non-citizens’ may turn to
political groups defending them against their conditions of oppression. So-called
extremist movements are not separate from the overall struggle of the labouring
classes as they deal with some of the basic building blocks of segmentation of
these most exploited classes.
So long as the processes of informalisation and the anti-labour policies persist
– including policies working against the interests of the self-employed engaged
in survival activities – it will continue to be an uphill struggle to improve the
80 Jens Lerche
conditions of the labouring classes. Unfortunately, with the segmentation of the
labouring classes, it is not easy to see how labour might be able to influence
core economic policies of the central and state governments. This makes it
important to understand the elements of labour activism in their actually existing
struggles, even if they are also shaped along other lines of identity, and even
if they seem too small to count.

Notes
1 Banaji (2003) and Linden (2005) have argued in similar theoretical terms to Bernstein.
2 Primarily Madhya Pradesh, Chhattisgarh, Jharkhand, Bihar, Orissa, Eastern Uttar
Pradesh and parts of Andhra Pradesh.
3 While, by international comparison, this constitutes a fairly slow move away from
agriculture, in India it is nonetheless a significant development, both economically
and socially.
4 The five states with the lowest share of employment in agriculture are: Kerala, Tamil
Nadu, West Bengal, Punjab and Haryana – ranging from 35 to 50 per cent in 2005
(Kannan 2007: 24). Kerala, Punjab and West Bengal are also the states with the
highest Net State Domestic Product from agriculture, while Haryana and Tamil Nadu
ranked sixth and eighth on this index (Chand, Raju and Pandey 2007: 2531).
5 It was 38 per cent in 2003 (NSSO figures) (NCEUS 2008: 35).
6 According to NSSO data, 54 per cent of the income of all marginal farmers is from
wages, 14 per cent from non-farm business, 6 per cent from husbandry and only 26
per cent from cultivation (NCEUS 2008: 34).
7 These agricultural labour figures raise the issue of the need to approach statistics
with caution, even those data generally regarded as reliable. Many field researchers
have pointed out that most of the so-called agricultural labourers are, in fact, primarily
non-agricultural labourers, even if this is not how they are enumerated. There are
also problems resulting from the lack of consensus over the enumeration of discrete
jobs: for example, is a labourer hired for a full crop harvest (which may well form
her/his main agricultural income) counted as wage labour or as a self-employed
contract worker?
8 Government regulations, including labour laws, apply only to units above a certain
size. The government extended the regulation-free zone significantly by doubling the
size of investments allowed by unregulated units (Rani and Unni 2004: 4579).
9 NSSO data shows that average real daily wage earnings of casual workers are lower
in agriculture than in non-agriculture (Unni and Raveendran 2007: 199), and poverty
data shows higher levels of poverty for casual workers in the primary sector compared
to those in the secondary sector (Bhalla 2008: 16).
10 While official figures exist for outworkers, they are likely to be on the low side
(NCEUS 2007: 5). No reliable official figures exist for bonded labour; the figure
used here is the minimum estimate by Lerche (2007).
11 Of these, only ‘employers’ and ‘unpaid family labour’ have been quantified (3 and
23 per cent of all self-employed, respectively) (NCEUS 2007: 50).
12 These figures are disputed. See Patnaik (2007) for the most radical critique, arguing
that, in fact, poverty has probably increased during this period. Moreover, applying
the 2008 World Bank upwards adjustment of worldwide poverty figures to India
would lead to a poverty figure of 42 per cent for 2005 (Ravallion 2008: 35). These
new World Bank estimates are also open to critique (Himanshu 2008).
13 The figures are: below US$1 a day: self-employed 48 per cent, against casual labour
45 per cent; the remainder are regular wage employees. Below US$2 a day, the
corresponding figures are 57 per cent and 35 per cent; above US$2 per day the
figures are 25 per cent and 10 per cent (Sengupta, Kannan and Raveendran 2008).
 From ‘rural labour’ to ‘classes of labour’ 81
14 Muslims are another group suffering from discrimination, but it is outside the scope
of the present chapter to analyse the specifics of their position (on discrimination
against Muslims, see the report by the Sachar Commiteee (Government of India
2006)).
15 Ninety-five per cent of Dalits and Adivasis work in the informal economy (Sengupta,
Kannan and Raveendran 2008: 52).
16 Of the Adivasis working in the non-agricultural sectors, casual workers in the
unorganised sector make up a larger proportion than is the case for any other group;
Dalits come second. Adivasis also have the highest poverty ratios among unorganised
sector workers, followed by Dalits (NCEUS 2007: 21–5).
17 Forty-five per cent of all Dalit/Adivasi informal economy workers are below the
poverty line and are disproportionally engaged in the least remunerative work
(Sengupta, Kannan and Raveendra. 2008: 53).
18 Seventy-nine per cent of both rural and urban casual workers work in enterprises with
no union/association. For self-employed the figures were: rural 80 per cent, urban 63
per cent, total 73 per cent. In 2004/2005, ‘only’ 53 per cent (both urban and rural)
of regular wage workers were employed in enterprises with no unions present (NSSO
2007b: vi, 76).
19 While most such organisations undoubtedly are altruistic, cases have been reported
of some new organisations being self-seeking, asking for commissions from labourers
in order to provide assistance, and then not delivering it (Madhavi 2006).
20 For example, no time frame exists for its implementation, nor are there any mechanisms
for dealing with disputes or complaints. Even more than was the case with NREGA,
its implementation will depend on power relations in the specific states (Rajalakhsmi
2009).
21 This said, the armed struggle between the Indian government, local vigilante militias
armed by the government and the Naxalites is a serious problem for the Adivasis. It
is commonplace that ordinary villagers, who tend to be sympathetic to the Naxalites,
are killed by the government side, in fake ‘encounters’; see, for example, Saha (2009).

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