Bonded labor, also known as debt bondage and peonage, occurs when people sell themselves as collateral for a loan or inherit a debt from a family member. It can be disguised as an employment contract, but it is one in which the worker is given a debt to repay – generally under harsh terms – only to discover that repayment is impossible. Their servitude will then be permanent.

When someone’s labor is requested as a form of repayment for a loan, they become a bounded laborer. The individual is then duped or forced to work for very little or no pay.


It is a practice in which companies provide high-interest loans to low-wage workers to help them pay off debt. The supreme court of India defined bonded labor as the payment of wages that are less than the current market wage and the legal minimum wage.

Whoever unlawfully compels any person to work against his or her will shall be punished by imprisonment of any description for a term up to one year, or by fine, or by both. The Indian penal code section 374

The individual is then duped or forced to work for very little or no pay. In India, bonded labor is illegal under Articles 21 and 23 of the constitution. The bonded labor system (Abolition) act, passed in 1976, was the first law to abolish the practice.


Workers are exploited via bonded labor. The cyclical process begins with a debt that cannot be paid promptly, whether purchased or inherited. The company then continues to pile on more charges as the worker works to repay the debt. A laborer, for example, might start out with a $200 debt. This worker needs a shelter, food, and water while working and unable to leave. To cover these costs, the employer adds $25 every day to the loan. As a result of continuing to work for his debtor, the employee’s debt accumulates, and payback is unattainable.

This obligation is frequently passed down through the generations, hauntingly resembling chattel slavery in the 18th and 19th centuries. It’s seen all over the world when businesses force employees’ children to work in the same environment as their parents to help pay off their parents’ debts, or when parents or family members pass away and employers demand another body to fill the void – all under the guise of a debt owed.

This type of captivity is especially dangerous for migrant workers. Migrant laborers contract with labor agencies and businesses in their home countries in order to find work in a destination country. Because agencies and employers have a debt or a bond over these employees, these situations are ideal for exploitation. Rather than respecting a legitimate term of employment, some recruiters or employers illegally abuse the initial debt by tacking on immigration, housing, and other expenses designed to keep migrant workers from ever being able to return the amount. In some cases, recruiters and employers seize legal immigration documents, rendering legal workers completely reliant on them. Alternatively, they may require a temporary job to maintain their legal status. In other cases, recruiters fake paperwork or simply ignore them, leaving migrant workers vulnerable and reliant. Workers are typically afraid to seek remedy in these instances.


  • Poverty
  • Discrimination
  • Social exclusion and insufficient implementation of legislation
  • Poor wages and inadequate education
  • deteriorating labor standards


The international Palermo Protocol mandates that bonded labor be classified as a type of human trafficking. Slavery remains a deeply ingrained system in many parts of the world. In India, Pakistan, Bangladesh, and Nepal, it is the most frequent. In truth, India is home to the bulk of the world’s slaves, who are forced to work as bonded laborers.


It is a felony and a blatant violation of a person’s human rights to force someone to work in a bonded labor situation. The national human rights commission and the Supreme Court have established rules to be followed in combating this evil in various judgements. Many non-governmental organizations (NGOs) are also active in this subject.

                                                                                                 WRITTEN BY JHARANA JENA

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