Report on Role of Trade Unions in State Building
Organised by Center for Labour and Social
28-29 April, Kathmandu
Ritu Raj Subedi
There has been unprecedented level of debate
over the nature and contents of new constitution although the
ongoing political crisis has cast a shadow on divergent voices
to be incorporated into the main law of land. Nepalese workers
that consist of around 12 million of total population are seeking
their role in the current state building process and thereby,
want to reflect their aspirations in the new statute. Trade unions
are now engaged in constructive dialogue with concerned stakeholders
to this end. To give a boost to their campaign, the Friedrich
Ebert Stiftung, the German political foundation, and the Centre
for Labour and Social Studies (CLASS) - Nepal, an NGO working
in the areas of labour and social issues, recently (28-29 April
2010) organised a national workshop 'Role of Trade Union in the
State Building' where the trade union representatives, government
officials and experts extensively shared their views. The participants
of the programme were composed of the people from different backgrounds
ranging from the social activists, workers and media people to
The two-day seminar was divided into two parts
- inaugural, and paper presentation and discussion sessions.
The issues of social security, labour-capital relations and
the contribution of trade unions in the constitution making
were vigorously raised during the programme. The speakers dwelt
on the workers' condition, their role, the limitation and responsibility
of the state and employers, and future course the trade unions
need to follow to bolster their positions. Many of them expressed
their concerns over the increasing militancy trend and divisions
among the trade unions.
National Planning Commission vice-chairman
Dr. Jagadish Chandra Pokharel called for identifying the real
stakeholders. "When I attend any programme, I am always
haunted by a question as to who are the true stakeholders?"
Pokharel presented an analogue of a gambling
to specify the genuine stakeholders. "In a gambling, there
are three groups - the players, those who partially participate
in the game by putting chankhe (bet), and finally the onlookers."
The interests of all sides are related to
the outcome of the game. "The players are the real stakeholders
because they are one who lose or win the game. Those who place
bet are at a little risk because they will not make or lose
the big amount of money. But, the onlookers are completely carefree.
They have nothing to do with who win or lose the game. They
finally join the winners for celebration."
Dr. Pokharel called of harmonious ties among
three components of the state - the government, the business
community and the civil society that also includes workers -
for the smooth functioning of national economy. "The labour
laws should be formulated and implemented in line with international
conventions and practices," he said.
Dev Raj Dahal, head of FES Nepal, said the
state needed to be strong enough to guarantee the rights of
weaker and deprived segment of the society. "When the elements
of violence and non-state players supersede the state, it is
the poor and working class people, who become the first victim
The workers constitute majority of Nepal's
voters, and, thus, it is reasonable to subordinate the power
of capital to sovereign people, said Dahal.
He said that the crucial priority for unions
now lay in making the invisible workers publicly visible, articulating
their legitimate concerns and becoming a creative partner in
social dialogue for the improvement of labour market situation.
He called for investing on human resource
development, launching poverty alleviation programmes and expanding
production facilities for decent wage and working condition,
enhancing workers access to health and education, and sharing
information about labour market.
He maintained that the CA had offered an opportunity
to the Nepalese trade unions to negotiate for a new social contract
and co-determine public policies.
CLASS-Nepal chairman Shankar Lamichhane, focusing
on the aims and overview of the event, noted that the organisers
wanted to make sure that the job and social security provisions
of workers be enshrined in the new constitution. "Labour
movements are the movements of creativity, and need to be respected
and should be properly recognised by the state."
GEFONT vice-president Bina Shrestha said that
a vast chunk of workers, involved in the informal sector, were
denied their basic rights while the formal sector workers, who
constituted less than 10 per cent of total workforce, had no
access to the services and facilities guaranteed by the existing
Khilanath Dahal, chairman of Nepal Labour
Academy, said that the trade unions needed to be independent
of the government, political parties and the employers, and
shun a negative image that workers are just a group of people
who only demand from the employers and do not contribute to
Saran KC, regional coordinator of Trade Union
Solidarity of Centre of Finland, said trade unions played an
effective role in the formulation of social, economic and monetary
policies in the advanced countries and this practice should
be also followed in Nepal.
Erik Neilsen, LO-FTF, Council, International
Consultant, South Asia Sub Regional Office, noted that the trade
unions were grappling with similar challenges worldwide and
the time had come for the Nepalese trade unions to work jointly
to realise their common goals.
Roman Awick, Labour Law and Industrial Relations
Expert Employers' Council -FNCCI, said that the trade unions
and the employers should be equally flexible so as to let the
national economy function smoothly.
Rajendra Kumar Acharya, UNI Regional Programme
Coordinator, said that the politicisation of the trade unions
had further added uncertainty to the effective implementation
of the existing labour laws.
Pushkar Acharya, chairman of Girija Prasad
Koirala Workers Academy, said that the Nepalese workers had
a role in the nation building and should work for the restoration
peace because new jobs were created only when there was peace,
law and order.
Mitra Kumar Rai of Nepal Trade Union Congress
said that the workers should contribute to the nation building
through their effective role in production and distribution
of the income.
During the first day close session, Deepak
Gajurel, an assistant professor at the Tribhuvan University,
and C.D. Bhatta, a programme officer at the FES, presented their
working papers. Gajurel's paper 'Labour, Social Security and
State in Nepal,' offered a historical background of social security
system and its international practices, and status in Nepal.
Bhatta's paper 'Restructuring Labour-Capital Relationship in
Nepal' was highly academic and offered insights about how capital
is formed in Nepal.
The participants complained that they could
not grasp much from the experts' concept papers as they are
in English. They asked the organisers to provide them in Nepali
Labour, Social Security and State in Nepal
"Social security is a public provision
for the economic security and social welfare of individuals
and their families, especially in the case of income losses
due to unemployment, work injury, maternity, sickness, old age
and death," Gajurel writes in his paper.
The social security programme was first introduced
in Germany in 1880 but it has not been yet fully introduced
and implemented in Nepal. The existing Labour Act and Rules
have some provisions to benefit the formal sector employees
and workers such as Provident Fund, gratuity, treatment expenses,
salary during treatment, compensations in case of disability
and death, among other. However, these provisions cover the
employees of limited areas - army, police, civil servant and
"The social security programme needs
to be implemented from the organised sector and trade unions
should act as vital stakeholders for this," said Gajurel.
He pointed out the need of chalking out flexible
legislations and their effective implementation to put a comprehensive
security system in place. However, the country is lacking a
viable economy to implement the security schemes suggested by
His paper drew both praise and criticism from
the dais and floor.
Commenting on it, Dr. Amuda Shrestha said
that Gajurel's paper did not mention about the methodology he
applied while preparing it. "In addition, it lacks statistics
to back his proposition. It keeps mum on the role of the state
as to how it could implement the social security provisions
for the majority of workers."
Shrestha said that there existed work-based
discriminations. "No work is big or small, good or bad.
We must learn to respect works of any kind. Those, who are involved
in menial jobs, should not suffer from inferiority complex,
which only weaken their bargaining capacity to claim decent
wages and better working conditions."
Stating that positive discriminations and
affirmative actions were necessary to bring the disadvantaged
and deprived communities into the mainstream of development,
she said that the time had come to vigorously debate on the
issue of corporate social responsibility in the Nepalese context.
Participants from the floor enthusiastically joined the discussion
on the issues touched and untouched by Gajurel's dissertation.
One participant said that the government collected
taxes from the workers involved in the industrial sector in
the name of social security but they were unknown about how
the funds has been utilised.
Women involved in the cosmetic business rued
that the trade unions were indifferent to their problems. "We
are self-employed and run business on our own. We have to face
various problems from the state agencies as we are unorganised
and do not get support from the unions."
Santosh Sadha of Janakpur, said that paper
could not address the social security of workers involved in
the agriculture sector. "The issue of social security should
not be confined only to the urban-based workers."
It is silence about the plight of domestic
and migrant workers, some said. "Migrant workers have no
access to the correct information as the government officials
often snub them despite their immense contribution to the national
economy. ILO should act as a watchdog so that their rights should
not be curtailed."
Many were critical regarding the role of trade
unions. "Are they just handy tool of the parties or real
agents of the workers?"
Moderator Saran KC, summing up the discussion,
said that there were good policies but they were not properly
implemented. "Unity among the trade unions is key to achieve
their social security goals."
Restructuring Labour-Capital Relationship
In his highly scholastic dissertation, CD
Bhatta said that the Nepalese state had failed to formulate
the policy in the favour of working people as it came under
the swing of neo-liberal agenda. "So, the trade unions
and the government should work together to establish a new labour-capital
"The way the capital is formed in the
country only serves the interest of a limited elitist class
and a vast chuck of population have no access to it," he
Presenting an asymmetrical structure of CA,
Bhatta said that there were only ten lawmakers representing
the 90 per cent of working population while 27 lawmakers were
from business community that represents just a 10 per cent of
total population. "This has made the task more difficult
to formulate policy in favour of workers. Therefore, the Nepalese
trade unions should be vocal and intervene in the public policies
to democratise the national economy in order to expand job opportunities,
build their capacity and ensure their social rights."
Commenting on Bhatta's paper, Ananda Raj Khanal
said that the paper offered a fresh approach on labour-capital
relations in Nepal.
However, Khanal said the writer did not mention
about the contribution of labour force to the national trade
"With the government's adoption of laissez-faire
principle, it was the elite, who benefited most from the liberalisation
policy. This has pushed the middle class into poverty and the
poor into poorer, which in turn, created a fertile ground for
social unrest" Khanal said.
He said there was capital flight from village
to town, and then from town to abroad following the opening
of the banks in the rural areas.
"Farmers are unable to get the fair price
of their products. For example, a farmer sells tomato at Rs.
5 per kg in Dhalkewar of Dhanusha but the people of Kathmandu
have to pay Rs. 45 per kg for the same amount of tomato. Middlemen
make a heavy profit by cheating both producers and buyers,"
Many of the participants from the floor pointed
out the need to harmonise the state's policy with that of trade
Dal Bahadur Dhami of WOREC said the existing
Company Act was more mercantilist and less benign to the workers.
Some said the trade unions should work for
capital formation by utilising the savings of the workers. One
participant said the development budget had not been fully spent
although the development budget had been increased. There is
a challenge to make fair distribution of profit. Referring to
the special economic zone (SEZ), Deepak Dhungana said the foreign
investment was considered as an important factor for economic
growth but there was the risk of capital flight provided the
government failed to bring appropriate laws to regulate the
Ram Mani Adhikari suggested for setting up
herbal industries in the mountainous region and providing technical
training to the locals so that they could be self-employed and
self-reliant. "Tariff on the items of tobacco products
and alcohol should be increased and the certain amount of this
revenue should be spent to create jobs."
Yuva Raj Neupane, an NGO worker, said the
common agenda of workers should be identified, and increase
in the extortion and unrests in the industrial sector, which
had led the industries to bankruptcy must be stopped. Shankar
Lamichhane viewed the hereditary skill should be utilised in
the social and economic areas so as to form the capital to the
benefit of workers.
Summing up the discussion, Bhatta said that
there was the need of structural change and policy should be
clear about the areas of economy, which could be privatised.
"For the last 50 years, the power structure of the country
has remained the same in the absence of democratic culture and
polity. This situation has posed a question: Who did actually
reap the fruit of democracy for the past several decades?"
On the second day of seminar, Umesh Upadhyaya
of GEFONT and Prem Singh Bohara of NTUCI presented their working
papers - 'Resolution on Trade Union Challenges in Nepal' and
'the Role of Trade Union in Constitution Building' respectively.
These papers highlight the responsibility of trade unions and
call for their collective action to fulfil their common agenda.
Resolution on Trade Unions' Challenges
Upadhyaya argued that those industrialists,
who rose from the landlord's background, had still feudal mindset
and are not positive towards the trade unions. The character
of state is capital-tilted and needs to be changed into a neutral
player so that it can balance between labour and capital. He
stressed on expanding the labour intensive economy to generate
more jobs. The negative image that the trade unions are instruments
of political parties and troublemakers for the employers must
be removed, he said and added that the informal sector should
be massively unionised to ensure that workers have better working
conditions, salary and other benefits. The formation of joint
union strictures at central and local levels, minimisation of
inter conflict, building public opinion, garnering support from
media and international agencies, developing industrial bargaining
system and educating the workers are necessary to give a new
height to the labour movement and solve the challenges they
Commenting on Upadhyay's paper, trade union
leader Khilanath Dahal said that there was the need of poverty
alleviation programmes to lift the people living below the poverty
It is said that employees, working in civil
services, education and banking sector, do not attend office
on the excuse that they are trade union leaders. "This
tendency must be stopped." Dahal suggested verifying the
number of union members and documenting informal workers through
a credible mechanism. "There should be equal participation
of labour and capital in the major policy formulation."
Rajendra Kumar Acharya said that the trade
unions are political institutions but not political parties.
There is need to define the relationship between trade unions
and the parties. "Now the trade unions should seek their
role in the management and share in the industries when they
are privatised." He argued that the political parties are
internally strong and the trade unions are externally powerful
because of workers' global network. In order to strengthen the
negotiating power of unions, Acharya offered a SCORE formula,
which literally means:
S - Socialisation and solidarity for social
C - Campaign for better wage, salary and working condition
O - Organisation
R - Research to back workers' position from fact and data
E - Education for the union members.
Keshav Bhattarai, the moderator of the session,
said that modern economy is based on skill, knowledge and technology
where there is no exploiter and exploited classes.
Role of Trade Unions' In Constitution Building
Bohara's working paper highlighted the history
of workers' movements, its contribution to democratic revolution,
the struggle and works trade unions to ensure their rights in
the interim and the new constitution.
Following the restoration of loktantra in
2006, seven trade unions formed an alliance 'Joint Trade Union
Co-ordination Centre (JTUCC) to bring their common agenda and
put pressure on the parties to include them in the future constitution.
The centre has succeeded to incorporate a13-point proposal in
the preliminary and concept papers of various CA thematic committees.
Some of propositions are: every individual has right to fight
against any form of exploitation; no worker will be exploited
on the basis of social ritual, tradition and culture; every
worker has right to be organised to protect his or her individual
right and welfare; no one will be forced to work against his
or her will; there will be no discriminations between male and
female workers in the distribution of wage for same the work,
and children will not be used in factory, mine and other risky
"To ensure these and other rights in
the new constitution, Bohara said, "the trade unions should
collectively campaign and lobby with political parties, NGOs,
INGOs, donors and international communities."
If the trade unions can't rise above the partisan
interests and if they fail to seize this golden opportunity,
the history will not pardon them, he warned.
Lawyers Dinesh Tripathi and Keshav Pandey
commented on Bohara's paper.
Pandey said that constitution should be drafted
on the basis of constitutional exercises and the practices of
court. "There is lacking the meaningful participation of
the people in the ongoing constitution making process."
Tripathi said the constitution is manifestation
of the country, not a documents of a single party. "It
should articulate the ambitions and aspirations of the people."
He said the constitution, as the main law
of the land, should be written lucidly so that laymen could
easily comprehend it. But, the elite people often try to mystify
The workers are major component of civil
society so they should strive to codify their concerns in the
new statute in line with the broader democratic framework, he
Both the lawyers expressed their strong reservation over the
attempt of some political parties to keep judiciary under the
Moderator Meena Singh Khadka said that laymen
were confused by the jargons of constitution and every people
should know it to exercise his or her rights in the society.
Participants called for strong mechanism to
implement the constitutional and legal provisions related to
the working class. "The right of minority such as Muslim
community and workers, involved in the informal economy, should
be guaranteed in the new constitution," some of them said.
Like the every segment of population, workers
are also trying to define their role at this critical juncture
of history. The Nepalese workers are not only crucial players
of the popular movements in the past. They were and are also
significant contributors to the economic health of the nation.
For the last sixty years, it the elite and a set of politicians
who have been taking the benefits from the political changes.
Now the time has come for the Nepalese workers to stake their
legitimate claim. They can achieve their goal only when they
meaningfully participate in nation building process. For this,
they should build their unified position and bring forward their
shared agenda to guarantee them in the new constitution. They
must initiate social dialogue with other stakeholders of the
society to oblige the state and business community to agree
for a new social contract to create wealth and redistribute
it fairly among the workers.
(The writer is a sub-editor of The Rising
Nepal, national English daily and can be accessed at firstname.lastname@example.org)