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The Object of the Contract Labour Regulation and Abolition) Act,
1970 is to prevent exploitation of contract labour and also to
introduce better conditions of work. A workman is deemed to be
employed as Contract Labour when he is hired in connection with
the work of an establishment by or through a Contractor. Contract
workmen are indirect employees. Contract Labour differs from
Direct Labour in terms of employment relationship with the
establishment and method of wage payment. Contract
Labour, by and large is not borne on pay roll nor is paid
directly. The Contract Workmen are hired, supervised and
remunerated by the Contractor, who in turn, is remunerated by the
Establishment hiring the services of the Contractor.
Registration And Licensing
The Act applies to the Principal Employer of an Establishment and
the Contractor where in 20 or more workmen are employed or were
employed even for one day during preceding 12 months as Contract
Labour. For the purpose of calculating the number, contract labour
employed for different purposes through different contractor has
to be taken into consideration. This Act does not apply to the
Establishments where work performed is of intermittent or seasonal
nature. If a Principal Employer or the Contractor falls within the
vicinity of this Act then, such Principal Employer and the
Contractor have to apply for Registration of the Establishment and
License respectively. The contractor The Act also provides for
Temporary Registration in case the Contract Labour is hired for a
period not more than 15 days. Any change occurring in the
particulars specified in the Registration or Licensing Certificate
needs to be informed to the concerned Registering Officer within
30 days of such change. From combined reading of Section 7 and
Rules 17 & 18 of the Contract Labour (Regulation and Abolition)
Central Rules, 1971, it appears that the Principal Employer has to
apply for registration in respect of each establishment. Other
important point to note is that a License issued for One Contract
cannot be used for entirely different Contract work even though
there is no change in the Establishment.
Penal Provisions
Section 9 of the Act provides that the Principal Employer, to whom
this Act is applicable, fails to get registered under the Act,
then such Principal Employer cannot employ contract labour. It
also appears that if the Establishment is not registered or if the
Contractor is not licensed then the contract labour shall be
deemed to be the direct workmen and the Principal Employer or the
Establishment shall be liable for the wages, services and
facilities of the contract labour etc. For contravention of the
provisions of the Act or any rules made thereunder, the punishment
is imprisonment for a maximum term upto 3 months and a
fine upto a maximum of Rs.1000/-.
Responsibilities
The Act enjoins Joint and Several responsibity on the Principal
Employer and the Contractor. The Principal Employer should ensure
that the Contractor does the following:
a) Pays the wages as determined by the Government, if any, or;
b) Pays the wages as may be fixed by the Commissioner of Labour.
c) In their absence pays fair wages to contract labourer.
d) Provides the following facilities:
i. Canteen (if employing 100 or more workmen in one place) and if
the
work is likely to last for 6 months or more.
ii. Rest rooms where the workmen are required to halt at night and
the
work is likely to last for 3 months or more.
iii. Requisite number of latrines and urinals - separate for men
and
women.
iv. Drinking water.
v. Washing.
vi. First Aid.
vii. Crche
e) Maintains various registers and records, displays notices,
abstracts
of the Acts, Rules etc.
f) Issues employment card to his workmen, etc.
Precedents
Significant judgments of the Supreme Court in the matter are:
1. Steel Authority of India Ltd. vs. National Union of Waterfront
Workers & Ors.
The Sail judgment stated that the contract workers would have no
right
to automatic absorption upon abolition. They would only have a
right to
a preference in employment if permanent workers were to be
employed to
fill in the vacancies created by the removal of the contract
workers
upon abolition. The Bench further added that on issuance of
notification by the appropriate Government under S 1 0(1) prohibiting
employment of
contract labour in a given establishment, it is for the contractor
to
provide work to his labour in other establishments, where the
contract
labour system is not prohibited. This decision reversed the
Supreme
Courts decision in Air Indias Case (contract labour of the
erstwhile
contractor stand absorbed on the rolls of the Principal employer
on
abolition of contract labour system by appropriate Government
under
section 10 of the Act).
2. Maharashtra General Kamgar Union vs. Cipla Ltd.
Gist of this judgment is that, if contract workers filed a
complaint of
any unfair labour practices against any principal employer
alleging
that he was, in fact, their employer and that the contractor was a
mere
name-lender interposed in the relationship merely to shield the
principal employer, this complaint would become non-maintainable.
Checklist For Principal Employer
1. Registration of the Establishment.
2. Display of the following notices rate of wages, hours of work,
wage
period, date of payment of wages, date of payment of unpaid wages
and
name and address of the inspector having jurisdiction.
3. Maintenance and Preservation of Register of Contractor.
4. Filing of Return of Commencement and Completion of the
Contract.
5. Filing of Annual Return.
6. Supervising the responsibilities of Contractor to avoid
enjoining of
the liabilities.
7. Ensure provision that facilities of Canteen, Drinking Water,
Washing,
Rest Room, Latrines and Urinals, First Aid, Crche are provided by
the
Contractor.
Checklist For Contractor
1. Licensing.
2. Renewal of the License.
3. Maintenance and Preservation of Register of Persons employed,
Muster
Roll, Register of wages, Register of Fines, Register of Deductions
for
damages or loss, Register of advances, Register of overtime.
4. Display of Notice rate of wages, hours of work, wage period,
date of
payment of wages, date of payment of unpaid wages and name and
address
of the inspector having jurisdiction.
5. Provide facilities of Canteen, Drinking Water, Washing, Rest
Room,
Latrines and Urinals, First Aid, Crche.
6. Employment card.
7. Service Certificates.
8. Half yearly return.
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Bibliography:
1.Labour File- Monthly Journal
2.Contract Labour- A Hand Book by A R Naidu
3.An Article by J Kanakiah on Contract Labour-
www.Shilpachitra.com
4.Contract Labour in India-
www.labour.nic.in
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Authored by Paras Jain and can be reached at
: paras_acs@yahoo.co.in
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