“Explore social security laws for unorganized workers in India, their legal framework, and challenges in implementation. Learn about government initiatives like PMSYM, Ayushman Bharat, and steps taken to address awareness, enrollment, funding, and coverage issues.”

The unorganized sector in India constitutes a significant portion of the country’s workforce, accounting for approximately 90% of total employment. However, a vast majority of these workers are employed in low-paying and precarious jobs without access to social security benefits. In recent years, the government has taken several measures to address this issue and provide social security provisions for unorganized workers.

In this blog, I will discuss the social security laws for unorganized workers in India, including the legal framework and the challenges faced in their implementation.

Legal Framework for Social Security for Unorganized Workers in India

The Constitution of India guarantees social security as a fundamental right under Article 41, which states that “the State shall, within the limits of its economic capacity and development, make effective provision for securing the right to work, to education and to public assistance in cases of unemployment, old age, sickness and disablement, and in other cases of undeserved want.”

In line with this constitutional mandate, the government of India has enacted several laws and policies aimed at providing social security benefits to unorganized workers. The major laws governing social security for unorganized workers in India include:

The Unorganized Workers’ Social Security Act, 2008: This Act aims to provide social security benefits to unorganized workers, including health and maternity benefits, life and disability cover, old age protection, and other welfare measures. The Act establishes a National Social Security Board for Unorganized Workers to oversee the implementation of social security schemes.

The Employees’ State Insurance Act, 1948: This Act provides for social security benefits to employees in factories and establishments employing ten or more persons. The benefits include medical care, sickness benefits, maternity benefits, and disability benefits.

The Employees’ Provident Fund and Miscellaneous Provisions Act, 1952: This Act provides for the establishment of a provident fund for employees in factories and establishments employing 20 or more persons. The scheme provides for savings and retirement benefits to employees.

The Maternity Benefit Act, 1961: This Act provides for maternity benefits to women employees in factories, mines, and other establishments. The benefits include paid leave, medical benefits, and other welfare measures.

Challenges in Implementation of Social Security Laws for Unorganized Workers in India

Despite the legal framework, the implementation of social security laws for unorganized workers in India has been slow and inadequate. The following are some of the key challenges faced in their implementation:

Lack of Awareness: The majority of unorganized workers are not aware of their entitlements under social security laws. The lack of awareness is due to the informal nature of their employment and limited access to information.

Poor Enrolment: Enrolment of unorganized workers in social security schemes is low due to various reasons such as lack of formal identification documents, inadequate infrastructure, and difficulties in accessing government offices.

Inadequate Funding: The government’s allocation for social security schemes is insufficient to cover the entire workforce. The limited funding also affects the quality of services provided under the schemes.

Poor Implementation: The implementation of social security schemes suffers from inadequate infrastructure, bureaucratic delays, and corruption. The lack of coordination between government departments also affects the effectiveness of the schemes.

Limited Coverage: The current social security schemes cover only a limited number of unorganized workers, leaving a vast majority without any social security benefits. The schemes also do not cover certain categories of workers, such as domestic workers and agricultural workers.

Steps Taken by the Government to Address Challenges

In recent years, the government of India has taken several measures to address the challenges in the implementation of social security laws for unorganized workers. The following are some of the key steps taken by the government:

Pradhan Mantri Shram Yogi Maandhan (PMSYM) Scheme: The government launched this voluntary pension scheme in 2019 for unorganized workers in the age group of 18-40 years. Under this scheme, the workers can contribute a certain percentage of their monthly income, and the government matches the contribution. The scheme provides for a monthly pension after the age of 60, helping workers build a retirement corpus.

National Health Protection Scheme (Ayushman Bharat): This scheme provides health insurance coverage to vulnerable sections of the population, including unorganized workers. The scheme aims to provide financial protection against high medical costs and ensure access to quality healthcare services.

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY): These are insurance schemes launched by the government that provide life and disability cover at affordable premiums. These schemes are available to unorganized workers and provide financial protection in case of unfortunate events.

Building of Infrastructure: The government has taken steps to build infrastructure and establish Common Service Centres (CSCs) in rural areas to facilitate the enrollment of unorganized workers in social security schemes. These CSCs act as a single point of contact for various government services, including social security schemes, making it easier for workers to access these benefits.

Extension of Existing Schemes: The government has also taken steps to extend the coverage of existing social security schemes to include more unorganized workers. For example, the coverage under the Employees’ State Insurance (ESI) Act has been expanded to cover more geographical areas and additional industries, including unorganized workers in the construction sector.


Social security for unorganized workers is a critical issue in India, considering the significant proportion of the workforce employed in the informal sector. While the government has made efforts to provide social security benefits to unorganized workers through various laws and policies, challenges in implementation persist. Lack of awareness, poor enrollment, inadequate funding, and limited coverage are some of the challenges that need to be addressed to ensure effective social security coverage for unorganized workers.

The steps taken by the government, such as the PMSYM scheme, Ayushman Bharat, PMJJBY, PMSBY, building of infrastructure, and extension of existing schemes, are positive initiatives towards addressing the challenges. However, sustained efforts are required to create awareness, streamline implementation, and ensure adequate funding to cover a larger section of unorganized workers.

In conclusion, social security for unorganized workers is a crucial area of research in labor law in India, and further studies and policy interventions are needed to strengthen the social security framework for unorganized workers, ensuring their well-being and protection in the workplace.

Author Bio

Qualification: Student- Others
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Location: Ahmedabad, Gujarat, India
Member Since: 26 Apr 2023 | Total Posts: 1

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February 2024