The startling comment by Infosys co-founder N.R. Narayana Murthy that youngsters in India must say, “This is my country. I want to work 70 hours a week”, in order to make the country competitive, and the support he received from several members of India Inc., is undoubtedly an example of how captains of industry can adroitly hide their lust for profits by preaching virtue. More importantly, it is an argument that fails the litmus test on three counts.
First, Mr. Narayana Murthy made a factually incorrect statement that extended working hours helped advanced countries such as Germany and Japan to succeed. Second, he placed the burden of increasing productivity on the shoulders of workers, when the reality is that they have underinvested in innovation, the critical factor for raising productivity. Third, Mr. Narayana Murthy’s 70-hour week proposal violates international labour standards (ILS), the International Labour Organization’s (ILO) Decent Work Agenda and its Fundamental Conventions that lay down the working hours in order to ensure that women and men get decent and productive work. The ILS is increasingly becoming the prerequisite for gaining market access in advanced countries and for companies to participate in supply chains. Non-adherence to ILS could, therefore, seriously affect the aspirations of Indian industry to expand their presence in global markets.
Working hours in the advanced world
Contrary to Mr. Narayana Murthy’s argument, advanced countries have witnessed a continuous decline in working hours per worker during the past 150 years. In Germany, weekly working hours have reduced by about 59%, from 68 hours in 1870 to less than 28 hours in 2017. Japan had a 44-hour working week in 1961, the highest ever since 1950, which steadily decreased to less than 35 hours in 2017. Working hours tend to decrease when incomes rise and people can afford more things that they enjoy, including more leisure. In fact, in more productive economies, workers work less, while in the less productive poorer economies, workers have to work more to compensate for lower productivity.
In this context, the ILO has reminded us (“Working Time and Work-Life Balance Around the World”) that “working hours and the organization of work and rest periods can have a profound influence on the physical and mental health and well-being of workers” and that “decisions on working time issues can also have repercussions for the broader health of the economy”. In a country, i.e., India, which considers its large young workforce as its most significant asset for future development, Mr. Narayana Murthy’s pitch for a 70-hour working week is nothing but a recipe for their early burn-out.
The leading lights of India Inc. who have triggered this controversy need also to be reminded that the level of productivity of a country depends on the strength of its innovation system. India’s reality in this regard was elaborated in the India Innovation Index 2021, produced by NITI Aayog. This report showed that in 2018, India’s gross expenditure on research and development (GERD) as a percentage of GDP was 0.65%, one of the lowest in the world). This figure dipped further to 0.64% in 2020-21, according to the Department of Science and Technology (DST).
The DST also informed that the private sector’s share in the country’s R&D spending was 41% in 2020-21, a decline from 45% in 2012-13. It may be noted that in countries which have stronger innovation systems as compared to that of India’s, private sectors have much higher shares. For instance, in 2020, the private sector’s share was 79% in Japan and Korea, 75% in the United States, and 67% in Germany and the UK. Even in China, the private sector’s share was 77%. These figures cogently explain why, in general, Indian enterprises lack the competitive edge in global markets due to lower levels of productivity.
The importance of the ILS
Ironically, a section of India Inc. has supported a 70-hour working week despite being aware that if it is implemented, this would be out of step with the ILO’s Convention No. 1, the Hours of Work (Industry) Convention, 1919, which had benchmarked an eight hour average working day. Together with the ILO’s Decent Work Agenda which deals with “decent working time”, the ILS is increasingly figuring in global trade rules. Advanced countries are insisting on the inclusion of the ILS in bilateral free trade agreements (FTAs). Thus, the FTAs India is currently negotiating with the European Union (EU) and the United Kingdom, both include the ILS.
The negotiating text unveiled by the EU last year includes a chapter on Trade and Sustainable Development which says that as members of this bilateral FTA, India and the EU shall promote “decent working conditions for all, with regard to, inter alia, wages and earnings, working hours, other conditions of work and social protection”.
The ILS is also central to the implementation of the Indo-Pacific Economic Framework for Prosperity (IPEF), a 14-country grouping for promoting economic cooperation in the region led by the United States of which India is a part. Six months ago, IPEF members forged an agreement relating to supply chain resilience seeking, among other things, “to promote supply chains in which labor rights … are respected, and create market demand for sustainable and responsible sources of supply”. Labour rights, according to this agreement, includes the ILO’s Fundamental Conventions, including “acceptable conditions of work with respect to minimum wages and hours of work”. This implies that Indian companies can participate in the supply chains among IPEF members only if they respect labour rights.
Supply chain regulations
Finally, the EU member-states have put in place regulations on supply chains, the so-called “Supply Chain Due Diligence”, obliging companies to implement due diligence processes to address their adverse impact on slavery, child labour, labour exploitation, besides environmental degradation throughout across the supply chains that they participate in.
France led the way by enacting the Corporate Duty of Vigilance Law, 2017, applicable to French companies having at least 5,000 employees in France or 10,000 worldwide, either directly or in their subsidiaries. Such companies must establish a “plan of vigilance” to “identify risks and forestall serious infringements of or harm to human rights and fundamental freedoms, personal health and safety …”. Germany enacted the Supply Chain Due Diligence Act, 2022 making it mandatory for German companies with 3,000 or more employees to monitor and act on violations of human rights, including forced labour, both within their own operations, as well as those of their direct suppliers. This requirement is applicable regardless of whether the activity was performed in Germany or abroad.
Also read | Former director of IISc Balaram defends Narayana Murthy’s 70-hour a week remark
Earlier this year, the EU member-states collectively adopted the Corporate Sustainability Due Diligence Directive, 2023, making it mandatory for companies to undertake due diligence to identify, and, where necessary, also prevent, end, or mitigate the negative impact of their activities on child labour and labour exploitation. Companies must assess the impact of their activities on their value-chain partners including, suppliers, sales, transport, distribution and storage.
With the developed world veering towards strict enforcement of ILS across global supply chains, India Inc. can ill-afford to support a weakening of labour rights.
Biswajit Dhar is a retired professor from Jawaharlal Nehru University and is now Distinguished Professor, Council for Social Development, New Delhi
