86_constuction workers in nepal.doc

7/27/2019 86_Constuction workers in Nepal.doc

http://slidepdf.com/reader/full/86constuction-workers-in-nepaldoc 1/11

Construction workers in NepalPresented by Umesh Upadhyaya, Representing GEFONT and CUPPEC Nepal in

Construction Industry Network Meeting, Aug 27-29, 2006, Organized by BWI/KFCITU,

Busan, Korea

1. Current Political situation

• Retrogression by the constitutional king after a series of dramatic events on

October 4, 2002 as a major turning point of the history of Nepal

• Already declared General Election postponed with no dates fixed in 2002

• The demand for all party government with full executive power and restoration of

the dissolved parliament–the major slogan of the joint movement declared by the

five major political parties of the dissolved parliament actually representing 84%of the peoples votes.

From May 4, 2003, the Joint peoples' movement started under five major political parties CPN-UML, NC, PF, NWPP and NSP

Major objective of the Joint Peoples' Movement was to protect the rights from the

attack of the ultra left violence and rightist retrogression

The movement of the five political parties became more popular and king

dissolved the cabinet under SB Thapa and asked the agitating political parties togive the consensus name for the post of PM in April 2004.

Parties could not give a consensus and hence a new coalition took the shape.

CPN-UML, NC Democratic, RPP and NSP joined hands in order to lead thecountry to the point of pre-regression. and supported Sher Bahdur Deuba who was

formerly kicked out by the king.

Thus in May 2004, king came to negotiate and appointed Deuba as the PrimeMinister and coalition government came into existence. NC and three other small

parties are in the street

Peace talks with Maoists as the major agenda of the government could not

become successful.

In February1, 2006, King grabed the power through mobilization of Royal nepal

army and started his direct rule.

Political parties tried to negotiate with the king even though they were in streetagainst king's unconstitutional autocratic move, but king tried to stabilise his

autocracy in the name of maoist terrorism

King took side against peace and tried to go in a useless military solution working

against all democratic norms negating the multiparty system in practice

Frustrated from the king's ambitious go ahead, seven political party Alliance

started to talk with Maoists and after a long exercise of more than 7 months,successful negotiation with maoists in the form of 12 point understanding in

Decenber 2005 could be reached to restore democracy and peace in the country.

From the beginning of the year 2006, the political environment of Nepal had beendominated by heavy tousle between King and mainstream political parties. The



movement being launched by the seven party alliance started to gain momentum

and and suppression from the side of autocracy became more and more cruel.

The autocratic king moved on to hold the so called municipality election on

February 8. Seven Party Alliance declared general strike and grand peaceful

demonstration to be staged on January 20 and urged to people to come to the

street. Arrests and brutal suppression became daily routine. The municipal election was a total failure caused by the successfull boycott of the

people. Even by casting fake votes as there was no one to oppose in the polling

centers, the regime with its total efforts could cast lower than 20 % of the votes.

The 12-point understanding between mainstream political parties and CPN-

Maoist developed after series of informal talks was welcomed by the People.

People took it as the real road-map for the solution of Maoist problem as well asfor the end of absolute monarchy. This could give a significant hope among the

people. Therefore, the movement of SPA gained momentum and participation

became more and more effective.

During this period, the international support to restore democracy, press freedom

and release of political detainees has been highly significant. Human Rightmonitoring office of UN has played a very important role during this period.

April 2006 in the history of Nepal has proved to be big turning point. The

political environment of Nepal came to a decisive point with extreme tousle

between King and mainstream political parties. The movement being launched by

the seven party alliance gained incomparably high momentum and suppressionfrom the side of king's autocracy became cruel at its extreme.

With increasing flow of people in the movement, arrests and injuries were

maximum never witnessed in the history. The entire nation came into the street.From April 6, the movement in the form of general strike started for 4 days as

declared in the beginning. Later on with nationwide success and heroic encounter

by the armless people with suppressive royal force, the general strike became aroutine for every coming day. This continued for 19 days. During these 19 daysmaximum mobilization of people was 8 millions in a single day on April 22. In

Kathmandu during April 15 -22, half a million people came in the street everyday

defying the curfew. The whole nation was under curfew but everyday peopledefied curfew. Because of incomparable mass mobilization, security force finally

became frustrated with the king and only on 19thday,the autocratic king

surrendered. He accepted the roadmap of seven party alliance in his formaldeclaration and reinstated the parliament to go ahead for peace and full

democracy. New SPA government came to work in the democratic environment.

The reinstated parliament declared many things, among them is the election of

Constituent Assembly and formation of new inclusive constitution. For this theseven party alliance government has appealed the Maoists to join the interim

government. Dialogue with Maoists is in progress. Maoists are now in open and both way cease-fire has been declared. Terrorist tag and red corner notice against

Maoists has been canceled. Though there a number of confusions and

dilemas/disputes, positive and hopeful situation is gradually developing.

Based on 12-point understanding between mainstream seven party alliance andCPN-Maoist, new 8 point understanding is also conducted. Now the issue of



management of arms is at height and UN has been formally invited to cooperate

on this issue.

At present, Nepali sky is fully surrounded by achievements, hopes and

confusions. People are happy, but confused whether this peace will be permanent

or not.

Now the politics and so the entire nation has entered into a very complicated process of negotiation with Maoists basically on the management of arms,

modality for constituent assembly and model of restructuring of Nepali state. SPA

government is in power, but with consensus on management of arms, new interimgovernment with involvement of Maoists will have to be formed.

2. Labour market & Union Movement

Unemployment, displacement of rural labour and out-migration

Declined Economic activities

Increased closures & high demand for exit policy by employers

The level of unemployment gone high up.

Displacement of families from rural areas

Pouring masses in District HQs & Kathmandu valley

Out-migration expanded more for foreign employment

Expansion of union activities in the informal sector

Expansion in construction sector

Expansion in agricultural sector

New initiatives for street vendors

Single union initiatives

Unity has become the most relevant agenda in trade union scenario with the

increasing pressure of globalization, slackening economic activity, closures

resulting into higher level of unemployment, violation of collective bargainingagreements & labour laws in enterprise level and employers continuous urge

for hire & fire in addition to illegal threatenings of Maoists

GEFONT moves to interact with Non-NTUC public sector unions

GEFONT and NTUC initiatives

BWI Affiliates Committee Nepal in a number of joint activities

ICEM Affiliates Coordination Committee Nepal in a number of joint activities

Minimum wages revised with significant achievement in 2003 and 2006 In 2003 - Altogether 21% increase in the national monthly minimum wages

and 25 % in national daily minimum wages (17% increase in basic wage and

29% in dearness allowance)

Revised again in 2006 – 29 % increase in national monthly minimum wages

and 39% increase in daily minimum wages (29 % in basic and 28 % in DA)



3. Construction industry and trade unions

The construction industry in Nepal is significant as its contribution to GDP is about 10 %,which is one of the largest single contributions after agriculture. About 70 % of the

national gross capital formation also comes from this sector.

Table-1: Composition of GDP in Nepal, 1994 to 2002 (in percent )

Description 1994 1995 1996 1997 1998 1999 2000 2001 2002

Agriculture 40.75 40.4

8

40.3

6

38.8

2

40.11 39.63 38.3

8

39.4

9

39.16

Non-agriculture 59.25 59.5

2

59.6

4

61.1

8

59.89 60.37 61.6

2

60.5

1

60.84

Mining &

Quarrying

0.53 0.56 0.55 0.54 0.51 0.50 0.49 0.51 0.50

Manufacturing 9.31 9.38 9.21 9.31 9.19 9.16 9.02 8.09 7.91

Electricity, Gas& Water

1.36 1.50 1.65 1.51 1.40 1.62 1.78 2.02 2.15

Construction 11.0 10.9

0

10.8

6

10.5

2

10.08 10.21 10.0

6

10.4

3

10.36

Trade, restaurant& Hotel

11.59 11.83

11.33

11.62

11.91 11.71 11.33

10.05

10.14

Transportation,

Communication& Storage

6.67 6.64 7.17 7.80 7.46 8.01 8.46 8054 8.76

Finance & realEstate

9.78 9.83 10.07

10.28

10.06 10.08 10.58

10.82

10.95

Community &Social Services 9.01 8.88 8.80 9.60 9.27 9.09 9.91 10.05 10.06

Source: CBS, National Accounts of Nepal 2003

Distribution of economically active population has increased significantly if we compare the

statistics of two censuses

Table-2: Percent Distribution of Economically Active Population by Industry

Major Industry 1991 2001

Agriculture, Forestry & Fishing 81.23 65.70

Mining & Quarrying 0.03 0.16

Manufacturing 2.04 8.81Electricity, Gas & Water 0.16 1.49

Construction 0.49 2.89

Commerce 3.49 9.94

Transport & Communication 0.69 1.63

Finance & Business Services 0.28 0.00

Personal & community Services 10.25 6.70



Others 0.38 1.65

Industry not related 0.96 0.22

Source: CBS, Population Monograph of Nepal, Vol. I, 2003, Kathmandu

Among the total labour force of non agricultural employment, construction workers have

the share of 8.4 %, overwhelming majority of which is in the informal sector.

Table 3: Distribution of Labor force in Non-Agricultural Occupation, 2001

Occupation Number %

Mining and quarrying 16048 0.5

Manufacturing and recycling 872253 25.7

Electricity, gas and water supply 148218 4.4

Construction 286418 8.4

Wholesale and retail trade 863773 25.4

Hotels and restaurants 120889 3.6

Transport, storage and communication 161638 4.8Financial intermediation 46765 1.4

Real estate, renting and business activities 29922 0.9

Public Administration and personal service 301024 8.9

Education 228381 6.7

Health and social work 61797 1.8

Other community, social and personal service 72575 2.1

Private households with employed persons 105139 3.1

Extra-territorial organisations and bodies 58273 1.7

Not reported 22395 0.7

Total 3395508 100.0Source: Central Bureau of Statistics, Population Census, 2001

Looking at the age structure of the construction workers in Nepal, extent of child labour seems little but not negligible, whereas more than 3/4 th are in the age group of 15 to 44.

Table 4: Construction Workers by Age Group

Age-group Number of workers %

Below 15 8640 3.0

15-24 73855 25.7

25-34 84059 29.3

35-44 63688 22.2

45 and above 56178 19.6

Total 286420 100.0

Source: Central Bureau of Statistics, Population Census, 2001



The construction industry consumes more unskilled workers. A study conducted by

GEFONT in 2003 has revealed the fact that 3/4th of the workers in this sector are

unskilled.

Table-5: Category of the Construction Workers by SkillCategory Male Female

Unskilled 23.5 58.8

Semi skilled 23.5 35.3

Skilled 41.2 2.9

Highly Skilled 11.8 2.9

Source: GEFONT , Search for Alternatives, 2003

Basic rights in construction:

The CUPPEC Survey of 2004 has shown a clear picture of basic rights in Nepali

construction, the table below clarifies the realityTable 6: Provision of Basic Rights of the Workers

Basic Rights Availability Yes

Appointment letter 4.8

Permanent Appointment after 240 days work 2.5

8 hours working hours 93.2

Provision of Overtime 82.1

Right of Collective Bargaining 30.5

Provision of OSH 60.9

Provision of Labour Relation Committee 36.1

Regulation (BINIYAM) of enterprise 30.0Provision of PF, Pension & Gratuity 6.2

Fixation of Minimum Wage 4.9

Use of Foreign Workers 32.9

Job Security 4.9

Skill Development & Promotion 56.0

Leaves

Weekly 11.5

Public 11.5

Funeral 14.3

Home 6.5Sick 15.4

Maternity 13.0

Source: CUPPEC Survey, 2004

It can be easily concluded that only the administrative and technical workers enjoy most

of the rights and the general workers are deprived from various rights.



Wages & discrimination in Construction Industry

The wage rate of construction workers is normally above than casual workers of other sectors, but due to the entrance of large number of displaced people market rates

have taken a downward trend. The Bhutani refugees almost from a decade have been in

the labour market in disguise and they work mainly in construction industry in whatever conditions and rates.

Overwhelming majority of workers in construction work in daily wage basis while

only a few in other terms and condition. About 10 percent construction workers in

Kathmandu are involved in other activities as a secondary occupation like street-vendor,newspaper-hawkers, and casual workers known as kulli- kawadi, where local workers can

be found engage in farm related occupation in morning and evening time. On an average

an unskilled worker could draw about NRs 2470 per month where skilled worker earn NRs 4400 at the same time. In this sector, one working have to support up to 5 non-

working family members.

Table 7: Percentage of Wage Earners in Construction Industry

Area/particulars Construction workers

among total

Non-agricultural

Workers

Nepal 35.3

Male 37.4

Female 23.1

Eastern Development Region 36.8

Central Development Region 26.6

Western Development Region 38.5Mid-west Development Region 50.3

Far-west Development Region 47.3

Mountain 39.9

Hill 30.9

Terai 39.2

Rural 41.4

Urban 17.7

Poorest 53.7

Richest 12.2

Source: NLSS 2003/04, CBS, Kathmandu

The monthly per capita earnings of the employee in construction sector are far

below than the average earnings of the workers in other sector. Agricultural workers have

lowest earnings. Construction sector comes at the 14th rank.

Table 8: Average Monthly Per capita Earnings

Sector Average Monthly



Per capita Income

(NRs)

Financial Intermediation 4,468

Extra Territorial Organisation 3,425

Real estate, renting and business 3,399

Electricity, gas and water supply 3,373Public administration and defence 3,078

Hotels and restaurants 2,988

Transport, storage and communication 2,950

Health and Social work 2,948

Education 2,844

Fishing 2,827

Manufacturing 2,567

Other community services 2,561

Wholesale and retail trade 2,331

Construction 2,298

Mining and quarrying 2,073Private household workers 1,519

Agriculture, hunting, forestry 1,246

Source: ILO, Decent Construction Work in Nepal

The monthly earnings in construction sector are low though daily wage in

construction sector is usually higher than the nationally established minimum wage. The

average daily wage in different ecological zone shows higher wage rate in the mountainand lower in the Terai. The wage rate varies largely from place to place and one season to

another.

Table 9: Average Daily Wage in Construction Work by Ecological ZoneCategory of Worker Terai Hill

Skilled 200 237

Semiskilled 150 157

Unskilled Male 104 132

Unskilled Female 80 112

Source: ILO, Decent Construction Work in Nepal

There is significant discrimination in wage by gender despite the legal provision of

equal remuneration for equal work. The discrimination is more among females.

Discriminatory Practices

Gender discrimination is clearly visible in all construction companies, though the proportion may vary from one company to another or from one grade to another. It is

surprising that gender discrimination is low in the non-graded companies.



Table-10: Status of Discrimination

Between male and female by grade of construction companies

Grade of Companies Yes

Grade-A 94.4

Grade-B 100.0

Grade-C 100.0Grade-D 88.9

Non-Graded 60.0

Total 78.7


High discrimination is evident in wage payment. Generally, females draw low wage

compared to their male counterpart for the same volume and type of work. Besidesgender discrimination, the construction workers are also equally discriminated on the

basis of their origin - workers from Terai origin known as Madhesi (either from any parts

of Nepal or from India) and from the hill origin as Pahade.

Generally the Madhesi workers are abused verbally by most of the Pahadeemployers. Mostly they are humiliated in every work place. The wage rate is

comparatively low than the Pahade workers in all types of work though they work more

than normal working hours. Delay in payment is another discrimination being faced bythe Madhesi workers. There are few incidents, where the Pahade has been harassed

similar way in the construction site owned or managed by Terai origin people.

Unions at work

The violent conflict has naturally affected the whole economic & business environment

causing slackness even in the construction industry. However, union work iscontinuous and union activities have been expanding in construction sector in

spite of all these difficulties. If the problems will be solved and permanent peace

is restored, then union work as we hope will take new heights and speed.

At present owing to increased unemployment, construction sector is also affected.However, because of the physical destruction through explosives by Maoists, scope and

necessity of additional constructions and maintenance-renovation work is highly

increasing. As the infrastructures developed within the past years have been damaged bythe Maoists, reconstruction is highly required, which will generate heavy employment

opportunities in future.

Women workers' situation does not seem to improve immediately as there existunemployment and slackness of construction industry. Construction through MNCs is nothigh in Nepal and there are no new mega Construction project at present.

Thus in a difficult political and economic situation, CUPPEC-Nepal is working as the

biggest trade union of the construction industry. Other two federations CAWUN and

NBCWU are also working. BWI affiliates committee has organized grand interaction,workshop and seminar on social protection of workers in construction industry.



Proceedings have been published. Joint rallies have been organized. Lobbying and

campaigning for social protection has gained momentum this year.

Additionally, CUPPEC Nepal has also organized a number of activities on social protection in grass-root level. Mobile health camps as a part of health protection

campaign and counseling have been conducted. Saving Fund for its members have been

introduced by CUPPEC.

Looking back to the early days, Unionisation of workers in the construction sector startedin 1970s while the government was constructing East-West High way. Some 25,000

workers of East-West High way had launched general strike demanding immediate

settlement of their grievances, which later helped to strengthen newly launched National

Federation-NIWU- Nepal Independent Workers Union.

In post-1990 periods, unionization became very fast in construction. In the beginning

painters, plumbers, electro-workers and workers in carpentry & general construction were

in NIWU. With the realization of the need of separate union, Central union of plumbers,

painters, electro & construction workers of Nepal (CUPPEC- Nepal) came into existence.

The CUPPEC is working since 1991 (renamed as CUPPEC after amalgamation of three

federations in1997) and has unionised 56,228 workers. Adding the unionized number

estimated in the fold of all other unions of various small sizes, roughly 135,000construction workers are union member in different parts of the country.

Based on CUPPEC estimates, nearly 1,050,000 workers are involved in construction work

all over the country, which shows only 12.85 percent workers are unionized.

Problems Faced by the Construction Workers

Majority of workers are not getting wage in time. Their sickness is ignored and

leave is denied. Their labour is undocumented even if the employer fails to supplynecessary materials and equipment in time. Job security is major problem in this industry.

No written agreement between workers and employer is entertained.

Above all there are multiple problems the workers in construction industry facing.Table below reveals few major problems.

Table-11: Type of Problem Faced by the Workers

Problems In percentage

Main Contractor

Non-availability of wage in time 86.7

No agreement of work 4.4 Non-availability of goods/equipment in time 2.2

No attendance card 4.4

Fire of workers 2.2

Petty Contractor

Non-availability of wage in time 86.1

No agreement of work 5.6



Fire of workers 2.8

Non-availability of goods/equipment in time 2.8

No attendance card 2.8


The minimum wage/remuneration fixed by the government covers formalmanufacturing sector, agriculture and tea estate. Construction sector is not covered fromthe minimum wage provision. As a result they are exploited. Excess supply of labour

compared to demand in this sector reduces their bargaining power.

Generally, the workers involved in this sector do not shift elsewhere due to lack of knowledge and skill required for other occupation. As a result, they are compelled to

spend their whole life in construction industry.

Illiteracy and faith on the contractor is one of the major causes of exploitation of

unskilled workers by the contractors because in the absence of attendance card they could

not maintain daily attendance on the one and on the other they should rely on thecontractor to calculate their wage. Frequently it is known that the employers try to cheat

the illiterate workers by reducing the days of work and amount of wage in the absence of

attendance card.

General problems viewed by CUPPEC

Low Wages

Non-implementation of Minimum wages

Long working hours

Seasonal and temporary nature

No paid leaves such as weekly rest, sick leave, public holidays

No provision of provident Fund, gratuity, Medicare facilities

Unhealthy workplace and Unsafe working environment

Gender discrimination

Risky and hazardous job

Problem of timely payment

Humiliation in workplace

Unhealthy competition among the workers

Contract labour

Lack of education

Job unavailability due to Indian migrants and Bhutanese refugees

Source: Haami Niraman Kshetra Ka Mazdoor Haru

86_constuction workers in nepal.doc

Documents