Thanks to all for such good discussion on CL act. Can any one say in which base contract labour claim for permanancy employement.
From India, Ahmedabad
Acknowledge(0)
Amend(0)
From India, Ahmedabad
Acknowledge(0)Amend(0)
Strictly speaking, the Contract Labour System is an indirect form of labor used to meet the requirements of only incidental and intermittent nature of works in any establishment. The prudence of any employer, in the interest of the economy of operations, would naturally compel them to outsource such intermittent and incidental activities to another party who has the manpower at their disposal, the ability to monitor work-in-progress, and accomplish the activities in time to the satisfaction of the establishment's employer.
However, over time, this system began to be misused by employers due to the emergence of a surplus supply of labor compared to demand. The resulting effect was the gradual and unscrupulous contractualization of labor, even for the core activities of the establishments, for the sake of operational economy. To address this issue, the Central Government enacted the Contract Labour (Regulation and Abolition) Act of 1970.
The simultaneous existence of incidental and intermittent activities, along with core and perennial activities in every establishment, makes this Act regulatory and prohibitory in its operation. Section 10 of the Act empowers the Appropriate Government to abolish the contract labor system by prohibiting the employment of contract labor in any process, operation, or other work in any establishment based on certain factors. Thus, contract labor, per se, is permissible in the processes, operations, or other works in which it is not prohibited.
Therefore, the claim for permanency or absorption as regular workmen of the Principal Employer is only possible when the contract is deemed as sham by the adjudicator or Court.
From India, Salem
Acknowledge(0)Amend(0)
6108However, over time, this system began to be misused by employers due to the emergence of a surplus supply of labor compared to demand. The resulting effect was the gradual and unscrupulous contractualization of labor, even for the core activities of the establishments, for the sake of operational economy. To address this issue, the Central Government enacted the Contract Labour (Regulation and Abolition) Act of 1970.
The simultaneous existence of incidental and intermittent activities, along with core and perennial activities in every establishment, makes this Act regulatory and prohibitory in its operation. Section 10 of the Act empowers the Appropriate Government to abolish the contract labor system by prohibiting the employment of contract labor in any process, operation, or other work in any establishment based on certain factors. Thus, contract labor, per se, is permissible in the processes, operations, or other works in which it is not prohibited.
Therefore, the claim for permanency or absorption as regular workmen of the Principal Employer is only possible when the contract is deemed as sham by the adjudicator or Court.
From India, Salem
Acknowledge(0)Amend(0)
Dear Sir,
I am facing a dilemma in deciding how to provide compensation to the worker who passed away on the job. The agency holds a labor license as well as insurance from the M.P. Government, while we, as the principal employer, are registered with the U.P. Government. We issued form V to the agency, and they obtained a license from the MP Government. The accident occurred at a location in MP. However, the ALC has stated that it is not covered under the industrial area and advised us to go to the Labor court. Upon meeting with the advocate at the labor court in MP, the agency was informed that if the principal employer obtains form V from the MP Government and applies for new registration with the MP Government, the court may be more favorable.
Sir, could you please guide us on whether it is possible for a company to be registered with both the UP and MP governments and have this issue resolved? Our primary goal is to resolve this matter promptly so that the dependents of the deceased individual can receive the compensation amount from the insurance.
Thank you.
From India, Varanasi
Acknowledge(0)Amend(0)
I am facing a dilemma in deciding how to provide compensation to the worker who passed away on the job. The agency holds a labor license as well as insurance from the M.P. Government, while we, as the principal employer, are registered with the U.P. Government. We issued form V to the agency, and they obtained a license from the MP Government. The accident occurred at a location in MP. However, the ALC has stated that it is not covered under the industrial area and advised us to go to the Labor court. Upon meeting with the advocate at the labor court in MP, the agency was informed that if the principal employer obtains form V from the MP Government and applies for new registration with the MP Government, the court may be more favorable.
Sir, could you please guide us on whether it is possible for a company to be registered with both the UP and MP governments and have this issue resolved? Our primary goal is to resolve this matter promptly so that the dependents of the deceased individual can receive the compensation amount from the insurance.
Thank you.
From India, Varanasi
Acknowledge(0)Amend(0)
Dear anonymous friend,
The statement "The agency has a labor license as well as insurance from the M.P. Govt, and we are the principal employer with registration from the U.P. Govt. We had issued Form V to the agency, and they have obtained a license from the M.P. Govt. Also, the accident occurred at the M.P. location" is not clear to me. Can you please elaborate further?
Thank you.
From India, Salem
Acknowledge(0)Amend(0)
The statement "The agency has a labor license as well as insurance from the M.P. Govt, and we are the principal employer with registration from the U.P. Govt. We had issued Form V to the agency, and they have obtained a license from the M.P. Govt. Also, the accident occurred at the M.P. location" is not clear to me. Can you please elaborate further?
Thank you.
From India, Salem
Acknowledge(0)Amend(0)
Is a labor license required to be obtained if we have fewer than 10 employees per deployment location, and the total number of locations is 15? Do we need to verify the above in each state separately? Urgent opinions will be greatly appreciated.
From India, Delhi
Acknowledge(0)Amend(0)
From India, Delhi
Acknowledge(0)Amend(0)
Dear Nikom,
Licensing of contractors under the CLRA Act, 1970 is a requirement strictly based on the number of contract labour employed by them in every contract they enter into with the Principal Employer as fixed in sec.1(4)(b) or under its proviso thereof. As it is, if the number of contract labour engaged in a particular contract work is less than the minimum number prescribed, there is no necessity to take up a license under section 12 of the Act. However, the number of contract labour to attract licensing may differ from State to State. Hence, the need for checking the criterion in all the States where your locations are situated.
From India, Salem
Acknowledge(0)Amend(0)
Licensing of contractors under the CLRA Act, 1970 is a requirement strictly based on the number of contract labour employed by them in every contract they enter into with the Principal Employer as fixed in sec.1(4)(b) or under its proviso thereof. As it is, if the number of contract labour engaged in a particular contract work is less than the minimum number prescribed, there is no necessity to take up a license under section 12 of the Act. However, the number of contract labour to attract licensing may differ from State to State. Hence, the need for checking the criterion in all the States where your locations are situated.
From India, Salem
Acknowledge(0)Amend(0)
Respected Umakanthan.M Sir,
I'm working for an HR outsourcing company that also provides staffing services on behalf of other companies through their payroll. We have a client who acts as a contractor for other major industries, selling and applying their products. To assist with the application process, they engage subcontractors at the workmen level who help with the actual application. We, in turn, act as a subcontractor, providing Application Engineers who are primarily responsible for managing shifts and ensuring that the work is completed by the other contractual workmen engaged by the contractor through other subcontractors. These engineers are also responsible for production and report to the contractor's Accounts Manager and also to the Production Engineer. Their role is purely managerial or supervisory in nature, and they receive salaries ranging from 16K to 30K, excluding benefits such as PF, ESIC, Bonus, and Gratuity. The majority of them hold diplomas or graduate degrees in engineering.
According to the definition of workmen under the Contract Labour (Regulation and Abolition) Act, they do not fall under the category of "Workmen." Does the CLRA Act apply to them? In other words, is it necessary to maintain all registers and records as per the CLRA Act for this group? Currently, we maintain a soft copy of their attendance, process payroll through banks, issue payslips, and provide PF regardless of the coverage limit. If they are covered under ESIC, they receive ESIC benefits, or alternatively, they receive insurance under the Employees' Compensation Act.
I seek your valuable advice on this matter.
Thanks and regards,
Koyel Debnath - W.B.
Email: koyeldebnath561@gmail.com
+91 9163711749
From India, Mumbai
Acknowledge(0)Amend(0)
I'm working for an HR outsourcing company that also provides staffing services on behalf of other companies through their payroll. We have a client who acts as a contractor for other major industries, selling and applying their products. To assist with the application process, they engage subcontractors at the workmen level who help with the actual application. We, in turn, act as a subcontractor, providing Application Engineers who are primarily responsible for managing shifts and ensuring that the work is completed by the other contractual workmen engaged by the contractor through other subcontractors. These engineers are also responsible for production and report to the contractor's Accounts Manager and also to the Production Engineer. Their role is purely managerial or supervisory in nature, and they receive salaries ranging from 16K to 30K, excluding benefits such as PF, ESIC, Bonus, and Gratuity. The majority of them hold diplomas or graduate degrees in engineering.
According to the definition of workmen under the Contract Labour (Regulation and Abolition) Act, they do not fall under the category of "Workmen." Does the CLRA Act apply to them? In other words, is it necessary to maintain all registers and records as per the CLRA Act for this group? Currently, we maintain a soft copy of their attendance, process payroll through banks, issue payslips, and provide PF regardless of the coverage limit. If they are covered under ESIC, they receive ESIC benefits, or alternatively, they receive insurance under the Employees' Compensation Act.
I seek your valuable advice on this matter.
Thanks and regards,
Koyel Debnath - W.B.
Email: koyeldebnath561@gmail.com
+91 9163711749
From India, Mumbai
Acknowledge(0)Amend(0)
Dear Koyel, When there is a multiplicity of applications of Labor Laws to a particular establishment, the application of every such enactment is limited by its scope. When the employees supplied by you to your client are not "workmen" as defined under the CLRA Act, 1970, the Act won't apply in respect of such employees.
From India, Salem
Acknowledge(0)Amend(0)
From India, Salem
Acknowledge(0)Amend(0)
Dear Sir,
I want to know the entire process and the total cost incurred to obtain a labor license as a Principal Employer under the CLRA for 100 laborers in Uttar Pradesh. Additionally, I am looking to engage approximately 15 contractors for the completion of the task.
From India, Delhi
Acknowledge(0)Amend(0)
I want to know the entire process and the total cost incurred to obtain a labor license as a Principal Employer under the CLRA for 100 laborers in Uttar Pradesh. Additionally, I am looking to engage approximately 15 contractors for the completion of the task.
From India, Delhi
Acknowledge(0)Amend(0)
Is it obligatory that only contractors having a valid labor license be engaged? One organization engages fewer than 10 contract laborers through a contractor. Being exempted, the contractor did not have any labor license. What will be the consequences of such engagement?
A.K. Maitra
From India, Kolkata
Acknowledge(0)Amend(0)
A.K. Maitra
From India, Kolkata
Acknowledge(0)Amend(0)Looking for something specific? - Join & Be Part Of Our Community and get connected with the right people who can help. Our AI-powered platform provides real-time fact-checking, peer-reviewed insights, and a vast historical knowledge base to support your search.