Applicability of Contract Labour (Regulation & Abolition) Act 1970

This is with reference to the Contract Labour (Regulation & Abolition) Act, 1970, where I have some queries pertaining to adhering to statutory compliances by the principal employer and contractor. I, therefore, request you to kindly clarify the following issues:

Whether contract workers working under a contractor are eligible for paid holidays as per the National & Festival Holidays Act, 1969? If their physical attendance is absent one day before and after the paid holidays fall, are they still eligible for paid holidays?

Is it right to maintain separate registers like Wage Sheet and Attendance for each work order in one establishment, or can common wage sheets and attendance registers be maintained for separate work orders allotted by a single establishment?

If a contractor has been allotted three work orders by an establishment for providing different services (such as manpower supply, cleaning jobs, machine maintenance jobs) where 10 laborers, 15 laborers, and 15 laborers shall be engaged as per the work order for providing services to an establishment, will he be required to obtain a labor license from the concerned labor authority? Since he is not engaging more than 20 laborers in a single work order, will he be exempt from obtaining a labor license?

Thank you.

Dear Prakash,

Basically, contract labor has been a form of indirect labor adopted by some employers to facilitate the hiring and firing of labor according to their business necessities, so as to circumvent the provisions of the existing labor laws that protect the job security of employees. Though this practice initially started only with certain intermittent and incidental nature of operations or works that are distinguishable from the core activities of the establishment, it gradually spread to all activities, culminating in the passing of the Contract Labor (Regulation and Abolition) Act, 1970 by the Government of India. As the very title of the Act suggests, its objective is to regulate the working conditions of contract labor wherever it exists and only then to abolish it completely wherever possible. However, after the advent of the L.P.G (Liberalization, Privatization, and Globalization) era, the pace of abolition almost came to a grinding halt, and the engagement of contract labor has become ubiquitous, including in Government services. Therefore, the answers to your queries can only be with reference to the regulatory provisions of the Act as given below:

1) Water does not have any definite shape of its own; rather, it takes the shape of its container. So is contract labor. Contract labor is governed by the provisions of working hours, leave, holidays, etc., based on the laws applicable to the principal employer's establishment. Therefore, whatever rules relate to national and festival holidays applicable to the P.E's establishment are equally applicable to the contract labor engaged therein. I don't think that any law relating to national and festival holidays entitles an employee to such a holiday if they were unauthorizedly absent the day before.

2) If you go through the relevant rules of your state, you will find that the license issued is work-specific only. Therefore, the registers, etc., have to be maintained accordingly.

3) My answer to the previous question also applies to this. It is the work for which the contract labor is to be engaged that requires licensing. If the number falls below 20, there is no necessity to take up a license for that work, notwithstanding the fact that the same contractor has some other contract works in the same establishment.