T HE CHALLENGES IN CONTRACT WORKFORCE LAW PERSPECTIVE ENGAGING – LABOUR

L IVE CASES  Air India & Best & Crompton – IR exposure  Group 4 Securities – Financial exposure  Company X: for procedural and safety – Prosecution exposure

N EED FOR CONTRACT WORKFORCE  Uncertainty in businesses  Flexible arrangement within the legal framework  Employer can concentrate on ‘core’ activities  Entrusting to a professional agency

T YPES OF CONTRACTS  Job contract  Manpower supply contract (without supervision by the Principal Employer)  Both are recognised under the Act

W HAT NEEDS TO BE ENSURED ?  The work is not prohibited  Core and perennial nature of work to be avoided  Ration of regular Vs contract workers  There must be written agreement  Contractor does have EPF and ESI codes

U NDERSTANDING CERTAIN TERMS  Contractor  Contract Labour / Workman  Establishment  Wages  Ultimate liability

P RIMARY COMPLIANCE ACTIVITIES  Registration Certificate by Principal employer  Form V has to be issued to the contractor  Contractor license by the Contractor  Payment of minimum wage (national floor MW or notified MW)  ESI and EPF Coverage from day one  License by the contractor including sub contractors (or sub contractors)

O THER COMPLIANCE ACTIVITIES  Maintenance of registers  Submission of returns  Display of abstract / notices  Providing amenities to contract labour ( drinking water, toilets, canteen, etc. )  Safety measures

A BOLITION OF CONTRACT LABOUR  Only Sec 10 speaks about this  The legal position in case of ‘abolition’  Various judgements  Impact of:  240 days under ID Act  Can raise ID challenging the status  480 days under Conf Perm Status Act

O THER RELEVANT POINTS  EPF and ESI coverage from the first day  All categories of workforce “engaged for work” have to be covered  Bifurcation of minimum wages to minimize EPF outflow is not legally correct  Nature of each wage component determines statutory contributions – not nomenclature  PE’s liability on:  Gratuity – Two views prevail  Bonus – As on date, not liable

C ERTAIN CHECK POINTS  It has to be job contract  PE not to supervise and control CLs  PE not to allocate work  PE not to enforce reward or reprimand  PE not to make payment  PE not to sanction leave

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