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The Cost of ‘Ease’: Labour Protections Under Attack in Andhra and Karnataka

Pranjali Tripathi

On 4th June 2025, the Andhra Pradesh Cabinet approved the proposed AP Factories (Amendment) Bill, 2025, which alters key provisions of the Factories Act, 1948: increasing the maximum daily working hours from 9 to 10 (Section 54); extending the uninterrupted work period before a rest break from 5 to 6 hours (Section 55); and raising the total duration of the workday, including rest, from 10.5 to 12 hours (Section 56). The quarterly overtime ceiling, previously capped at 50-75 hours (Sections 64 and 65), is nearly doubled to 144 hours. A parallel amendment to the AP Shops and Establishments Act seeks to exempt commercial establishments employing fewer than 20 workers from most provisions (Section 73).

Two weeks after the Andhra Pradesh announcement, the Karnataka government unveiled its planned amendments to the Karnataka Shops and Commercial Establishments Act, 1961. Notably, the Karnataka Factories Act was amended in May 2023 to extend work shifts from 9 to 12 hours, pushed through after significant lobbying by Foxconn and Apple, but without any debate or trade union consultation. The flexibility clauses in the new labour codes and the central government’s deregulation push have spurred a “race to the bottom” to dismantle worker protections, with states feeling compelled to undercut each other on labour standards to attract business. These latest proposals have been met with immediate and widespread backlash — from trade unions, civil society groups, medical and industrial safety experts, and regular citizens/workers — decrying the rampant erosion of hard-won labour rights. A major coalition of trade unions has announced a nationwide demonstration on 9th July, 2025, with workers across sectors expected to participate.

The two state governments, like others, have justified the changes as part of efforts to improve “ease of doing business,” attract investment, enhance “competitiveness,” and align with “global standards” — echoing the central government’s rhetoric over the past decade. Indian policymakers have been pushing changes in this vein for years, eager to improve rankings (such as the controversial, now-discontinued Ease of Doing Business Index) and attract foreign investment. The 2024-25 Economic Survey, published earlier this year, doubled down on this rhetoric, highlighting ‘labour’ as one of four core areas for deregulation and urging states to lead “Ease of Doing Business 2.0” by addressing the “root causes behind the unease of doing business.”

For MSMEs, the Survey claimed, the primary barrier to scaling up is the desire to “steer clear of labour and safety laws,” and thus, deregulating labour is imperative. Empirical evidence from the past decade, however, shows that dilution of labour laws does not yield the much-touted ‘growth’ for MSMEs. To consider one instructive example, Rajasthan in 2014 was the first to implement significant rollbacks, including raising the threshold for retrenchment permissions from 100 to 300 employees, increasing trade union membership requirements from 15% to 30% of the workforce, and exempting smaller factories (with up to 50 contract workers) from the Contract Labour Act. These changes were hailed by large businesses across India as major ‘reforms.’ How did these ‘reforms’ fare? Chaudhary & Sharma (2022) found that “the amendments did not have a sizable aggregate impact on employment or output in the formal manufacturing sector.” A PHDCCI survey revealed that 70% of MSMEs were unaware of the reforms, and those who were aware only expected “marginal improvement” in business activity, as they continued to face significant operational and structural challenges including lack of market access, power and infrastructural deficits, and extensive administrative bottlenecks. On the other hand, the impact on worker safeguards was far-reaching. Using difference-in-differences analysis, Goswami & Paul (2021) found a “disproportionate decline in the directly employed workers.” Factories subject to the new rules “increased employment of contract workers by about 124%, and reduced the permanent workforce by 19%.” The “implicit labour cost” for firms fell ~14% (since contract workers are cheaper and have fewer rights), but there was no detectable improvement in output, investment, or productivity in those firms. The evidence from Rajasthan and other states is clear: when labour laws are relaxed, permanent jobs give way to contractual and casual labour, increasing precarity and lowering bargaining power without leading to real growth in employment.

Even if such deregulation does lead to increased investment or profit, this is a pyrrhic victory. And these are not new dilemmas. The dilution of the provisions of the Factories Act, 1948, across states, based on the argument that restriction on working hours prevents manufacturers from “meeting demand surges and participating in global markets,” reverses decades of progress made by working class struggles in India. When several Indian states justified longer shifts during the COVID-19 lockdown, they explicitly said the aim was for factories to operate with fewer workers and reduce the number of shifts while meeting production targets. The 8-hour workday, adopted in the very first ILO Convention in 1919, was a landmark victory for the international labour movement achieved after a century of struggle.The Supreme Court also weighed in on this principle during a 2020 case: when Gujarat tried extending workdays to 12 hours without proper compensation, the Court quashed the move as prima facie unconstitutional, calling it “an affront to the workers’ right to life and right against forced labour.” But the Indian State seems to have abandoned its constitutional mandate to ensure just and humane conditions for work (Art. 42).

State governments are, paradoxically, simultaneously relaxing labour protections while lacking the capacity to enforce even existing regulations. According to the Survey itself, just 644 inspectors are tasked with overseeing over 321,578 factories nationwide. Giving this withdrawal of oversight policy legitimacy, the Survey states: “under low-state capacity administrative systems, unrealistic expectations can lead to ‘premature load-bearing.” Tragically, India’s poor labour inspection record and severely understaffed labour departments are thus being used to justify deregulation rather than to build state capacity. While the vast majority (>90%) of India’s workforce has long operated outside the protections of labour regulation, for a small, shrinking segment of ‘formal’ sector workers, especially in factories, retail, and IT/ITeS, certain legal guarantees had remained, at least on paper: the eight-hour workday, capped overtime, weekly rest, and defined service conditions. It is these last vestiges of formal labour protection that are being systematically dismantled.

(Pranjali Tripathi is a researcher-practitioner working at the intersection of informal labour, migration, and social protection. She is currently based in Delhi. Courtesy: Countercurrents.org, an India-based news, views and analysis website, that describes itself as non-partisan and taking “the Side of the People!” It is edited by Binu Mathew.)

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‘Lazy’ Workforce or ‘Arrogant’ Government? Row Over Andhra Ordinance Allowing Ten-Hour Workdays

Pavan Korada

In the official vocabulary of the Andhra Pradesh government, the word is ‘flexibility’. It’s a clean, modern term used to justify a new ordinance allowing factories and private firms to extend the length of the standard workday from nine hours to ten.

According to the government, this is not about compulsion, but choice. Telugu Desam Party (TDP) spokesperson Deepak Reddy frames the policy as a move that simply “removes an illegality”, enabling companies and willing employees to agree to an extra hour of work.

But on factory floors and in the state’s industrial belts, that explanation is viewed by many as a threat. For workers like Ramesh, a middle-aged factory operator, the language is a dangerous distortion.

“For whom is this flexibility?” he asked The Wire. “The company now has the flexibility to demand another hour of my life. I have the ‘flexibility’ to either say yes or be marked as a troublemaker and lose my job.”

He added, “When one person has a stomach to feed and the other has a profit to make, it is not a negotiation. It is a demand. The government says the law removes ‘illegality’. No, it legalises exploitation.”

Ramesh’s poignant words throw into sharp relief the deep chasm over one of Andhra Pradesh’s most contentious new policies. Introduced as an ordinance by the National Democratic Alliance coalition government without legislative debate, the amendment to the foundational Factories Act of 1948 has reignited a debate, pitting the government’s push for investment against the rights of its workforce.

The government’s case: a pitch for global investment

The official narrative, articulated by information and public relations minister Kolusu Parthasarathy, is one of pragmatic necessity.

“You are in a global economy,” TDP spokesperson Reddy told The Wire. “If you come up with a large number of laws compared to what China has, how are you going to compete with China?”.

The argument is that to attract global capital, Andhra must offer competitive conditions. The key changes introduced by the ordinance, news of which circulated starting June 7, are:

• The maximum daily work hours are extended from nine to ten.
• The cap on overtime hours per quarter is nearly doubled, from 75 to 144.
• The continuous work period required to earn a 30-minute break is increased from five hours to six.
• Restrictions on women working night shifts have been eased, a move minister Parthasarathy bills as a step toward gender empowerment that will help women “contribute to industrial growth”.

Reddy insists the extra hour is not compulsory. “Whether somebody wants to follow that or not is based on their discretion,” he says, describing a state with a skilled labour shortage where companies are eager to pay more for extra hours.

The reality on the ground: ‘An illusion of choice’

This narrative, however, is met with deep scepticism on the factory floor. Trinadh, a young worker, told The Wire that he sees the law not as an offer but as a directive that removes any real choice.

“The government says it’s not compulsory. I want to invite any government official to come to the factory floor at 6 pm when the supervisor is standing there with the overtime sheet. Let’s see who has the real power to say ‘no’,” Trinadh said.

“This law doesn’t give us a choice; it gives the company a weapon. They will say, ‘The law allows ten hours, why are you only working nine?’ It becomes the new normal, and anyone who resists is seen as lazy or inefficient. It’s a trap.”

Opposition parties and civil society groups agree. “The state is under pressure from the [Union] government to amend rules to appease big industrialists,” said Communist Party of India (Marxist) state secretary V. Srinivasa Rao, arguing the changes “will only make the workers slaves”.

The Human Rights Forum was more blunt, describing the law as “an irresponsible and deliberate assault on labour rights and dignity” and demanding its rollback.

A ‘lazy’ workforce or an ‘arrogant’ government?

When pressed by The Wire on the risk of coercion, Reddy suggested that state welfare schemes have made some people unwilling to work. “The welfare schemes are making a lot of people too comfortable,” he stated.

When asked if this is the government’s ‘opinion’ or a ‘fact’, he insisted on the latter. “They are very choosy about what [work they want to do] … They want only IT-related jobs sitting under the fan or AC.”

This claim has drawn criticism, particularly as the government had, for the first year of its term, largely delayed the implementation of its own flagship “Super Six” welfare schemes. For workers, the comment is seen as a profound insult.

Lakshmi, a mother working in an electronics assembly unit, told The Wire: “Lazy? I wake at 4 am to cook for my family, work for nine hours on my feet looking at tiny circuits, come home to cook again, clean and care for my daughter.

“That little money from the welfare scheme – the one they delayed – helps me buy her milk and schoolbooks. To call us ‘lazy’ is a deep insult from a man who has never known a day of our lives.”

A senior trade union organiser from the All India Bank Employees’ Association, on the condition of anonymity, described this as a calculated political strategy.

“This is a classic ‘blame the victim’ tactic,” she told The Wire. “First, you create an economic environment that suppresses wages. Then, when workers demand dignity, you label them ‘choosy’. Finally, when they rely on promised welfare, you brand them ‘lazy’. It’s a narrative to justify stripping away their rights. The problem isn’t a lazy workforce; it’s an arrogant government.”

A ‘solution for a file, not a woman in the dark’

Disconnect between official policy and lived reality is also evident on the issue of women’s safety. With the new law relaxing restrictions on night shifts, the government’s proposed safeguard is the appointment of a “nodal officer” for every company.

Lakshmi, speaking to The Wire, explained why she believes this solution is inadequate.

“The government talks about a ‘nodal officer’. Will this officer walk with me down the dark lane to my house at 1 am? Will he be there when a group of men are standing at the corner?” she asks.

“A nodal officer is a phone number on a poster inside the factory. It is a solution for a government file, not for a woman alone in the dark. We need guaranteed, door-to-door, secure transport. Anything less is just an empty promise.”

Andhra’s approach contrary to Tamil Nadu’s

The path Andhra Pradesh is charting stands in stark contrast to some of its neighbours. In 2023, Tamil Nadu’s Dravida Munnetra Kazhagam government passed a similar Bill, only to withdraw it after widespread protests.

Chief minister M.K. Stalin called the withdrawal “a matter of pride”, declaring his government would “not compromise on the welfare of the workers”.

Andhra Pradesh appears determined to ignore this precedent. The government speaks of gross state domestic product, global value chains and skill censuses. But for the people who will power this new economy, the language is simpler. They speak of exhaustion, of time stolen from children and of a fundamental right being legislated away.

For them, the government isn’t building a new future, but dismantling a hard-won promise codified in the first flush of India’s independence: a life with dignity, earned in eight hours, not demanded in ten.

(Courtesy: The Wire, an Indian nonprofit news and opinion website. It was founded in 2015 by Siddharth Varadarajan, Sidharth Bhatia, and M. K. Venu.)