Social security acts as an essential instrument for social justice, transitioning modern states from laissez-faire regimes to active welfare providers.
1. Social Insurance vs. Social Assistance
| Social Insurance | Social Assistance |
|---|---|
| Funded jointly by contributions from employers, employees, and sometimes the state. | Funded entirely from the general revenues of the state (zero employee contributions). |
| Benefits are granted as a matter of right based on contribution records (e.g., ESI Scheme). | Benefits are granted based on a needs-test or specific eligibility criteria (e.g., old-age pension). |
2. Constitutional Mandates protecting Labour
The Indian Constitution incorporates social security guidelines under the Directive Principles of State Policy (DPSP):
- Article 39: Mandates that the state secure adequate means of livelihood, equal pay for equal work, and protect the health and strength of workers.
- Article 41: Mandates the state to secure the right to work, to education, and to public assistance in cases of unemployment, old age, sickness, and disablement.
- Article 42: Directs the state to make provisions for securing just and humane conditions of work and for maternity relief.
- Article 43: Mandates securing a living wage and decent standard of life for all workers.
- Article 43A: Directs the state to secure the participation of workers in the management of undertakings.