In one of the workshops related to contract labor management, one speaker queried if contract labor is eligible for a bonus or not. The question was raised in light of the fact that the Payment of Bonus Act does not specify payment to contract labor. Furthermore, the Contract Labor (Regulation and Abolition) Act is also silent on the payment of a bonus.
In our organization, we include the bonus component in the minimum wages payable, which is then paid to the contract labor. However, we would like to request our friends to share their opinions on this subject.
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In our organization, we include the bonus component in the minimum wages payable, which is then paid to the contract labor. However, we would like to request our friends to share their opinions on this subject.
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Why do you pay bonuses to your contractors' employees who are engaged in your establishment? Bonuses should be paid by the contractor. As far as you are concerned, you just have to ensure that bonuses have been paid to all employees of the contractor who are eligible for them. If you find that contract employees have not been paid bonuses, then you can intervene and arrange to give bonuses either by instructing the contractor or by doing so directly, pending recovery from the contractor.
Now, the practice of you fixing the wages of contractors' employees is very dangerous. If you fix them, that means your relationship with the contractor's employees is that of employer and employee. If so, the contract employees can claim employment in your establishment.
Furthermore, it is not by adding bonuses or other variables that you should determine wages as per the Minimum Wages Act.
Regards,
Madhu.T.K
From India, Kannur
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4479Now, the practice of you fixing the wages of contractors' employees is very dangerous. If you fix them, that means your relationship with the contractor's employees is that of employer and employee. If so, the contract employees can claim employment in your establishment.
Furthermore, it is not by adding bonuses or other variables that you should determine wages as per the Minimum Wages Act.
Regards,
Madhu.T.K
From India, Kannur
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We pay bonuses to contract laborers, but how can we ensure that the bonuses are being paid to all contract employees? The contractors provide bonuses for all their contract workers who have been working in the organization under their contract for more than 30 days. However, those who leave the job within 30 days do not receive the bonus. In some cases, the contractor submits a bonus disbursement statement to us, showing fake signatures of contract employees acknowledging receipt of the bonus.
Brijesh
From India, Pune
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Brijesh
From India, Pune
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You have to instruct the contractor to disburse the payment of bonus in presence of authorized representative of Principal employer.
From India, Pune
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From India, Pune
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Dear All, Could you clarify whether the contractor labour is eligible for Bonus under payment of bonus act if yes- who has to pay and is it compulsory? rns
From India, Mumbai
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From India, Mumbai
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Primarily it is the obligation of the contractor to pay bonus to his workers. Regards, Madhu.T.K
From India, Kannur
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From India, Kannur
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Contract labor are not employees of the Contractor. They are a special category who acquire the status of 'contract-labor' under the Contract Labor Act-1971. If they were the employees of the Contractor, they would be eligible for bonus, gratuity, retrenchment compensation, etc., as the normal employees of an employer would be entitled to. However, 'contract-labor' are a special species who trace their origin and existence under the Contract Labor Act. Therefore, they are entitled to only those benefits as are specified for 'contract-labor' in the Act, which are wages, PF, and ESI. Nothing more, nothing less.
rhari
From India, Ahmadabad
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rhari
From India, Ahmadabad
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HI, I have a doubut, if we add bonus to the monthly wage, just to increase their net, will this bonus component attract the ESI? Chaitra
From India, Bangalore
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From India, Bangalore
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Yes, it will attract ESI since all payments made in an interval of not more than two months will be treated as part of wages. Madhu.T.K
From India, Kannur
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From India, Kannur
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