CONSTRUCTION WIORKERS IN NEPAL

Shankar Lamichhane

INTRODUCTION
Construction - Major contributors to the process of development . Accounted for 45% of the total development investment made since 1975. Contribution to GDP was 9 percent (CBS 2001a). Provides employment for 1115% of the working age population in the non-agricultural sector (NLFS, 1998 & 2008). Informal approach to construction practices is prevalent. Registered contractors also engage workers through informal contracts. Due to high flow of Nepalese Workers to foreign countries has caused

shortage of workers - Indian migrant labourers ( Skilled and Non Skilled) fill
the gap in the construction actives.
2

Objectives : To identify the types of employment relationship that exists in the construction industry of Nepal Explain about organizing strategies to organize the construction workers.

Methodology Quantitative & Qualitative Analysis mostly based on secondary information.

Limitation of the Study Report based on available secondary information .

Agriculture is the main occupation employing 73.9% of labour force and contributes 34% of the GDP The service sector provides work for around 19% of the labor force. Industry accounts for the remaining 7% approx.

About 54 percent of Nepal's population constitutes labor force (aged between 15-64 years).
Labour force in wage employment in Nepal is 21%, selfemployed labour force is 79 per cent. Five percent of population is totally unemployed.

Sector wise labour participation

Year 1998/99 Years 2008

Description

Number Thousand

Percentage of
Total

Number Thousand

Percentage of
Total Employed Non Agri. 0.9 25.1 3.5 11.9

Employed Total Employed Employed in Agriculture Employed in Non Agriculture Mining & Quarrying Manufacturing Electricity, Gas and Water Supply Construction 9463 7203 2260 7 553 26 344 76.1 23.9 0.1 5.8 0.3 3.6

Non Agri. 0.3 24.5 1.2 15.2 11779 8705 3074 27 773 109 367

73.9 26.1 0.2 6.6 0.9 3.1

Wholesale, Retail & Trade

Hotels / Restaurant Transport/Storage/Communication Financial Intermediation Real Estate / Renting and Business Public Administration / Defense Education Health & Social Work Community Social Activity Private Household Work

408
114 135 19 32 70 164 34 57 289

4.3
1.2 1.4 0.2 0.3 0.7 1.7 0.4 0.6 3.1 0.1

18.1
5.0 6.0 0.8 1.4 3.1 7.3 1.5 2.5 12.8 0.4

692
197 198 32 71 109 285 77 99 33 5

5.9
1.7 1.7 0.3 0.6 0.9 2.4 0.7 0.8 0.3 0.0

22.5
6.4 6.4 1.0 2.3 3.5 9.3 2.5 3.2 1.1 0.2

Others 8 Source: Nepal Labour Force Survey Report 1998/99 and 2008

Informal Sector in Nepal

About 3 million people aged 15 and over in the informal sector accounts for 70 percent of all employment in main jobs outside of the agricultural sector. Formal sector is employing 0.93 million persons. Out of total working people in informal sector 1.37 million are male and female are 763000.
Employed Population (Age 15+) by Formal / Informal

1998/99
Sector Total Agriculture Non Agriculture , Formal Non Agriculture, Informal Total 7204 603 1656 9463 Male 3176 509 1052 4736 Female 4027 94 605 4727 Total 8705 932 2142 11779

2008
Male 3429 711 1379 5519 Female 5275 221 763 6259

Source: NLFS, 1998/99 and 2008, CBS

History of Construction Development

Periods of Development From To 1769 1846

Contemporary Regime

Characteristic Feature

Kingship Founder Establishment of 'Banaune Adda' (Construction Bureau) king and his heirs Up-grading of BA - To Central Public Works Bureau.

1846

1951

Rana Regime

Separate units for construction within and outside valley. All works executed departmentally.
Ministry of Works and Transport established in 1951-52.

1951

1957

Panchayat Regime

First five year plan put into implementation. Industrial Policy Resolution 1957 - declared construction as the priority sector industry.

1957

1974

Industrial Enterprises Act (IEA 1974) defined contractors, and made Panchayat Regime provisions for the registration and classification of contractors in class 'A', 'B' and 'C' categories

Panchayat 1974 1990 Regime 1990 To date Multiparty Democracy

IEA 1974 was modified to provide specific legal definition of the construction firm. Construction Enterprises Act 1998 and Construction Enterprises Regulation 1999 promulgated.

Source: CAN Various

Legal Framework - Construction Workers Issues

Labour Act 1992(Amended 1998) Labour Act 1993 (Amended 1998) No separate set of acts and regulations governing construction sector workers.(The Labour Act and Regulations only legal instrument). Labour Act , Clause 46 -The management (owner) is responsible for: Providing all the equipment to be used at construction site. Accommodation, food supplies and potable water with more than fifty labour at work. Ensuring appropriate accidental insurance, safety of the workers on site. PPEs to be made available. Clause 84 Paid to be in accordance with the written contacts or else within 7 days. In case of default in payments the worker can lodge a complaint in DLO or CDO. DLO or the CDO will summon the culprit within fifteen days and can force him to deposit the due payments. Labor legislation prohibits employment of child labour and night-shift duties for women, compulsory record keeping and a set of wage and welfare arrangements. The welfare arrangements include compensation for accidents and 'incapacity to work', social benefits available through the Provident Fund, medical facilities, insurance and public holidays. The regulation provisions "Minimum Wage Fixing Committee", consisting of equal representations of workers Although legal provisions cover major aspects but lags to address the grievances due to weak implementation.

Trade union Act 1993 First amendment 1998 in trade union act widened the labour union coverage to informal sector. Thus Trade union right of the construction workers is legally protected by the Act.

Scope of Construction Activities in Nepal

Public Sector Annual Government spending on infrastructure development is the major source of construction sector employment. Private Sector Construction works owned and funded by private sector constitute a significant proportion of construction activities, particularly in the urban areas. Construction of Hotels, commercial and office complexes, real estate development (residential complex) as well as private houses are the dominant source of employment in construction sector (Jha, 2002). Building Material Production The processing and manufacturing units for building materials such as bricks, stone aggregates and tiles also generate considerable employment.

Stakeholders in the Construction Sector

Government Agencies Employer and Regulator Ministry of Physical Planning and Works , Ministry of Water Resources and Ministry of Local Development The Ministry of Labour and Its Departments / Branches Nepalese Contractors - Federation of Contractor's Association of Nepal (FCAN -1997). Construction firms- Class A contractors - 175, Class B - 350 , Class C 1425 and Class D 2000 (CAN 2000). Nepalese Consulting Firms and SCAEF - 1990 Expatriate Contractors Linked with Projects financed by bilateral and multilateral funding. Sublet more than 60% of the contract value to local contractors. Local contractors sublet labour components to - Smaller contractors, including unregistered enterprises headed by Naikeas. Council of Technical Education and Vocational Training (CTEVT) - Government agency Skill development. - General Mechanic, Electrical, Sanitary Fitter, Construction Supervisor, Welder, Basic Construction Trades (Mason, Bar-bender, Scaffolder etc.), Fitter, Woodworker/ Carpenter, Metal Worker and Surveyor. Construction Industries Training Center (CITC) - Private sector initiative Trade Unions - Main stake holder of the construction sector. Trade Union National centers and their construction sector federation are dedicated to organize and protect the right of the construction workers. Decent work is the major issue of workers of Nepal.

EMPLOYMENT SYSTEM IN CONSTRUCTION SECTOR

Informal Construction Enterprises

The Naikeas
Private House Building Private Non-Residential Building Registered Construction Enterprises
( Public Infrastructure Development and Housing Companies)

Construction Workers
Easy entry - The bulk of construction workers from Agricultural Sector enter in the Construction Work

Supply of labour is largely seasonal.

{Unskilled Workers having agricultural land in their villages, prefer not to work from June to August -paddy plantation season and November/December - paddy harvesting season}.

75% Construction Workers are unskilled workers. Workers start as unskilled labour and acquire their skills on the job (process of learning by doing) Skill is more important than the years of formal education in construction sector.

Category of the Construction Workers by Skill

Category Unskilled Semi skilled Skilled Male 23.5 23.5 41.2 Female 58.8 35.3 2.9

Highly Skilled

11.8

2.9

Source: GEFONT, Search for Alternatives, 2003

Construction Workers
Labour Associated With Naikeas - Informal construction groups or Naikea, may be either skilled or unskilled . Socially cohesive entity, in which the members work and live together. Naikeas is not just a head of the business but is more like the head of a family. Construction Workers at Pickup Points (Naka Workers) - Information is exchanged and contacts renewed. Meeting ground for the stakeholders. Informal information centre for labour market. Place for social interactions find relatives, friends and associates and renew contacts. All categories of construction workers - skilled mason or stone dresser, (Dakarmi), carpenter (Sikarmi), bar-bender (Nakarmi), plumber, electrician or unskilled workers (Jyami), Specialized Groups at Local Level Specialized groups - roof casting, bar-bending and scaffolding, electrical wiring and fitting, plumbing, marble and tile fitting, plaster of Paris works etc. Roof casting (Dhalan-party) Unique in nature / majority members unskilled. Generally, consists of 30 to 40 members, 25% to 40% women. Specialized Groups at National Level

Construction Workers
Construction Material Workers - Workers involved in the production of construction materials Stone Aggregate Workers The established and highly mechanized factory Workers and Manual Stone Crushers Brick Kiln Industry Workers There are more than 500 brick factories in Nepal employing more than 400,000 workers. Female Construction Workers Significant Contribution of female workers. The NLFS (2008) survey found 52,000 female construction workers as against 292,000 males. Female constituted 25 to 40% of the roof casting groups and 75% of the stone crushers. Marble Polishing - specialized job where women workers at majority Migrant Workers in Construction Sector (Indian Labourers) Around 50 to 55 % of construction workers at pickup points in Kathmandu are Indian migrant labourers while proportion of Indians in the Terai towns is lower. Half (50%) of the Indian migrant workers are from Bihar. Uttar Pradesh , Bengal , Rajasthan and others states constitute 20 %, 15 %,10 % and 5 % respectively. Similarly, 35% of the Indian labourers are skilled and 65% unskilled (Jha, 2002).

Terms and Conditions of Employment in Construction Sector

Working duration per day - 8 hours. Overwhelming majority - daily wage earners. Wage - normally above than casual workers (ILO, 2005). Unskilled Construction worker - NRs 8000-10000 / month or NRs 350 450/day (Minimum wage NRs 4600/month or NRs 190/ day in Kathmandu) Similarly, Skill labour NRs 500 600/day or NRs 12000- 15000 / month (minimum wage of NRs 4760/month for skill labour). Payment mechanism - informal and purely guided by inter personnel relationship. The mode of payment for labour depends upon mutual convenience. Workers may be paid individually and directly by the contractor as per daily wage rate . Public sector construction activities, registered contractors depend on gang leaders to supply labour. Workers paid on daily wage rates, no any social benefits. Discrimination in wage by gender despite the legal provision of equal remuneration for equal work. Lack of awareness about Workmen's Compensation Insurance Policy and kind of social benefits. Thinking about retirement or non working period benefits is beyond imagination. Brick making and stone crushing are least rewarding. Usually filled by women, children and the elderly. Health and safety on the average site is very poor. Use of safety equipment (Personal Protective Equipment) is the rare trend. Mostly workers are not provided such PPEs.. The concept of accidental insurance is relatively new. Victims were helped by the Naikeas or the owners, sub-contractors and contractors on purely humanitarian grounds. Social protection is the far reaching issue till date.

Organizing Construction Workers

Organizing - Its Importance
Unity is only strength of the weaker. Sangham Saranam Gachhami, Shanghe Shakti Kaliyuge Government support, employers rational or law for workers only cannot be the reliable means for the justice to the working people. Members are the union and organizing is about winning in the workplace, winning in the society. WhereWining by and large mean, win group strength over individual weakness, win hope over fear and win dignity over oppression.

Organizing and Trade Union

Trade unionism - Fundamentally based on the principle of collectivism. Organizing - Key priority for Trade Union.

Organizing - Communicate with members and other , Awareness creation, Recruit new members.
Construction sector operations generally of mobile nature. High mobility - Major challenge to organize workers.

Present Organizing Situation

Process of unionization - after restoration of democracy in 1990. First amendment of Labour Act in 1998 and Trade Union Act in 1999 provisioned for organizing informal workers accelerated union activities in the informal sector including construction sector.

Construction and Allied Workers Union of Nepal (CAWUN) affiliate union of NTUCI 60330 Members Central Union of Painters, Plumbers, Electro and Construction Workers Nepal (CUPPEC-Nepal) affiliated with GEFONT 56228 Members . All Nepal Construction Workers Union (ANCWU) affiliate union of ANFTU -13500 members. Total unionized number (Including the members of all other unions) - 135000.
Nepal Labour Force Survey Report 2008 344000 workers in construction work. (So the percentage of unionized workers in this sector is approx 40%). CAWUN and CUPPEC are affiliated with Building and Woodworkers International (BWI) a global union federation of construction sector workers in the globe .

Organizing Techniques
No readymade solutions and single model regarding organizing the workers. Organizing strategy depends on legal framework of the country such that what right exist. Type of industry and state of the industry, nature of employment, types of workers (self employed/wage employed/home based/ contract/etc), availability of the union resources (financial, material & people) determine the organizing strategies. Image and status that the trade union has is another matter that influence the organizing process. In conventional approach, union/union officials provide collective & individual services to members. Wide spared informal workplace - Insufficient and quit impossible to provide services by handful of union officials to the union members. So the concept of organizing model in trade unionism.. Actions at macro policy level - effective tool to create environment for organizing.
Campaigns at national level on issues such as Labour law reforms to ensure the Right to Organise, to Union Recognition, for Collective Bargaining Rights (ILO Conventions 87 & 98) TripartismRight to be represented in the decision making bodies at Govt level Campaign for domestic social clause (Companies using public funds/ subsidies/national resources to respect workers rights) Partnerships with other social organizations/ linking workers movement with others

Organizing Techniques
Organizing Culture - Organizing at top priority - allocate resources, involve unions in systematic campaigns, increase members . Organizing culture not just implies an approach to organizing but also a vision of union purpose & form. It seeks workers as the active participants rather than passive consumers. Instead of just solving problems, union fosters activism, cooperates to empower workers to solve their problems through union.
Team Building a Tool for Effective Organizing Leadership Development AHA (Anger, Hope, Action) Technique for Organizing : Tool for organizing the working people.

Organizing Techniques
Campaign as a Tool for Organizing
Campaign - Identifying the issues , getting people to help and run the campaign program. Campaign - Increases the visibility of union, Improves the representation of underrepresented groups and ultimately Attracts the non member to join the union Major Campaign Issues for organizing Collective Bargaining at sectoral level, regional level Coalition building Workplace educational campaigns Lobbying Media campaign Health and safety

Organizing Actions at Workplace

Field action program like; workshops and educational forums, social events, demonstrations and rallies, informational picketing and distributing literature in the field / workplace are the tools that pay effective result in promoting organizing.

Multi-union Organizing Regular Visit by Organizer / Leader

Organizing Techniques
Organizing through Self Help Groups Cooperatives
Working together - main philosophy of cooperative. Cooperative is an autonomous association united voluntarily to meet - common economic, social, and cultural needs and aspirations through a jointly owned and democratically controlled enterprise.

Utilize the potential of cooperatives Saving and credit cooperative, Consumer cooperative, Group insurance are the collective action binding the workers in the group - ultimately helps for greater cohesion among the working people.

Membership Servicing For the effective organizing Trade Union need to go beyond collective bargaining, like Providing social welfare services linking with govt programmes for providing access to workers for social welfare programmes. Using group insurance schemes to provide social protection - health care, life insurance Organizing through saving, credit and social welfare services Organizing not at workplace but at workers living areas Housing, Cultural, sports and leisure activities, Skill training

CONCLUSION
Construction sector plays vital role - providing employment; absorbs underemployed agri. labours
Informal employment relation is the wide spread phenomenon . Major priority of workers finding the work on regular basis and maintenance of the income.

Skill supports in raising the income. Process of learning by doing - to upgrade the skill .
Contribution of women is significant but are deprived. Along with the exploitation in terms of wage, are employed only as helpers and lag for opportunity in acquiring skills.. Low wages, long working hours, seasonal and temporary nature, no paid leaves (weekly rest, sick leave, public holidays), no provision of social security (provident Fund, gratuity, Medicare facilities), unhealthy workplace and unsafe working environment, gender discrimination, problem of timely payment, unhealthy competition among the workers, and Contractual work are the common feature of construction sector. Such features causing exploitation and deprivation are the major challenge. Establishment of collective bargaining mechanism and system can support for wellbeing. Unity of the workers is the ultimate mean. Organizing and organizing only should be the major target of trade union.

References & Bibliography

CAN (2000), Nepalese Construction Souvenir, Published by the Federation of Contractors' Associations of Nepal (CAN) to Commemorate the 7th General Assembly, Kathmandu. Carr, M & Chen, M.A. (2002), Globalization and the Informal Economy: How Global Trade and Investment Impact on the Working Poor, ILO, Geneva CBS (2000), Statistical Pocket Book Nepal, Kathmandu, Central Bureau of Statistics, National Planning Commission, His Majestys Government, Nepal. CBS (2001a), Statistical Pocket Book Nepal, Central Bureau of Statistics, National Planning Commission, His Majestys Government, Nepal. CBS (2001), Census 2001, Kathmandu, Central Bureau of Statistics, National Planning Commission, His Majestys Government, Nepal. CBS (1998/99), Nepal Labour Force Survey, Central Bureau of Statistics, His Majestys Government, Nepal, Kathmandu. CBS (2008), Nepal Labour Force Survey, Central Bureau of Statistics, Government of Nepal, Kathmandu. CUPPEC-Nepal (Various-1998 to 2002), Nirmankarmi, periodical published by the Central Union of Painters, Plumbers, Electro and Construction Workers-Nepal (CUPPEC-Nepal), an affiliate of GEFONT, Kathmandu. GEFONT (2007), Nepal: Labour under the Chimney, General Federation of Nepalese Trade Unions, Kathmandu Jha, K.K. (2002), Informal Labour in the construction Industry in Nepal, Sectoral Activities Programme, Working Paper 187, ILO ,Geneva ILO (2005), Decent Civil Works in Nepal: From Research to Action Planning, ILO Country Office Nepal, Kathmandu NPC (1998), Eleventh Plan (2007-2012), National Planning Commission Secretariat, Government of Nepal, Kathmandu. UNDP (2001), Nepal Human Development Report 2001 - Poverty Reduction and Governance , United Nations Development Program, Kathmandu. Vaid, K.N. (1999), The Construction Industry in Nepal - the Challenges of Manpower Development. National Institute of Construction Management and Research (NICMAR), Walchand Center, Mumbai.

Thanks for Listening