Ans. Principal Employer should execute well drafted agreement and other documents to
establish the relationship of principal employer and contractor. Principal employer should
not establish the supervision and control over the contract labour for carrying out any activity.
It is advisable to have the expert services for this whole process. Because any minute
lacunae in drafting of various documents may land principal employer and the organization
in trouble in case of dispute. I strongly discourage the growing habit of copy paste exercise
normally concerned managers do while engaging contractor for their organization in terms
of various documents. This should not be done because each organization has its own
specifications, limitations, nature of work and requirements etc.
Q. License not renewed but contractor continues to work – legal implications
including permanency?
Ans. Even if the license of the contractor is not renewed but continues to work, contractor
labour can’t claim permanency with the principal employer merely on this ground. However
contractor can be prosecuted for the violation of the provisions of the act for not getting his
license renewed. Karnataka High Court in the case of Steel Authority of India Ltd. (1990) 64
FLR 573 has held that licensing is only a regulatory measure and it does not create any
privilege. Bombay High Court in the case of General Labour Union (Red Flag) has held that
the employees engaged by a contractor to run a canteen for a company does not become
employees of the company if the contractor fails to register the contract with the appropriate
authorities. Supreme Court in the case of Deena Nath (1992 LLR 46) has held that
consequence on non compliance with the provisions related to registration and license is
penal.
Comprehensive range of professional services and project capabilities
Professional background and career accomplishments
Ans. The situation where contractor in changing but contract labour remain same may be viewed against the principal employer as it reflects against the spirit of the act unless the shift of labour from one contractor to other is properly documented. This may lead to declaration of sham contract. Supreme Court in R.K. Panda case (1994 LLR 634) has held that workers working under different contractor for last 10 years will be absorbed by the principal employer. Q. Contract terminated due to unsatisfactory performance of the contractor, contractor leaves – can contract labour claim permanency? What should employer do? Ans. No! In this situation contract labour can’t claim permanency in the organization. The moment, contract is terminated, the workers employed by such contractor looses the right to enter into the premises of the principal employer to work as it is the responsibility of the contractor to either keep such labour under his employment or clear their accounts. If principal employer allows such contract labour to work in the premises without any tag / identification, in all probabilities such contract labour will be deemed as the workmen of the principal employer. Q. Contract labor terminated through a settlement. Should principal employer be a party? Ans. No! Principal employer should not become a party to such a settlement executed between the contractor and his workman. It is a mutual matter between the contractor as employer and his workman. Q. When contractor runs away leaving his workforce and supervisor, how to manage work and labor and who is to handle pending conciliation reference? Ans. It is for the contractor to discharge his responsibility as employer towards his workmen. If he runs away leaving his workforce, in no way principal employer is responsible for taking
Experienced trainers delivering impactful, learner-focused sessions with a commitment to skill development, practical insights, and professional growth across various domains and industries.
Objectives: Stress management Time management
Target Audience
Corporate
Materials Provided
Mode
In-person
Preferred Training Tools
Zoom plate
Required Training Setup
Mic Projector
Duration
Full day
Material Provided By
Projector
Languages
Feedback Given
Yes
Maximum Candidate Handeled
50
102 Cresent complex
Bangalore, Karnataka, India
Not available
Not available
A visual journey through our work
