How is a Contract Labourer covered under the ID Act? There is no specific provision in the CLRA Act, 1970, on the applicability of the ID Act for all purposes or with regard to disputes. There is no express provision that an illegally retrenched contract Labourer can seek a remedy under the ID Act. So, it is always a debatable question in the course of any dispute between a contractor and a contract Labourer as the enactment that exactly settles the dispute is absent in the applicable Labour enactments.
The broad view is that once a reference is made by a Labour department of any state to the Labour court, it is considered, and several judgments have come in favor of the contract Labourers on their illegal terminations. However, the provision under which enactment expressly directs the aggrieved contract Labourer to raise the dispute under the ID Act for a reference later to the Labour Court in case of non-settlement of the issue by the Labour department is not known.
Some refer to the exclusion categories in the definition of "workman" under Sec. 2(s) of the ID Act, which includes the contract Labourers, while some depend on the verdicts of the Apex court. My query is how an illegally retrenched contract Labourer can blindly approach the Labour department for redressal and what provisions of any applicable enactments would help him to do so?
From India, Visakhapatnam
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10The broad view is that once a reference is made by a Labour department of any state to the Labour court, it is considered, and several judgments have come in favor of the contract Labourers on their illegal terminations. However, the provision under which enactment expressly directs the aggrieved contract Labourer to raise the dispute under the ID Act for a reference later to the Labour Court in case of non-settlement of the issue by the Labour department is not known.
Some refer to the exclusion categories in the definition of "workman" under Sec. 2(s) of the ID Act, which includes the contract Labourers, while some depend on the verdicts of the Apex court. My query is how an illegally retrenched contract Labourer can blindly approach the Labour department for redressal and what provisions of any applicable enactments would help him to do so?
From India, Visakhapatnam
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A worker who is engaged through a contractor is not a workman of the Principal employer for whom he works but for all remedies, grievances, etc., he can approach his employer, i.e., the contractor. Between them, the provisions of the Industrial Disputes Act will work. It is only when the contractor himself is a dummy or when the contract is a sham that the question arises whether the principal employer should interfere in the dispute or not. Certainly, if the contract is a sham, the basic contract is void, and the workers engaged through the contractor shall get regularization as employees of the Principal employer.
This issue has been discussed in length by various courts at various instances. Let us reopen with some expert opinion about it.
I hope Umakanthan Sir will comment on it and take the discussion on. Please, Sir.
From India, Kannur
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This issue has been discussed in length by various courts at various instances. Let us reopen with some expert opinion about it.
I hope Umakanthan Sir will comment on it and take the discussion on. Please, Sir.
From India, Kannur
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Thank you, Madhu, for inviting me to the discussion on the query raised by our friend Kesavapanda. I am really sorry for my belated response due to my preoccupation with some personal works.
Before coming to the ultimate query, I think it is pertinent to look into the scheme of redressal of industrial employment grievances under the existing labor laws in India.
The first and foremost mechanism of dispute resolution has been provided under the Industrial Disputes Act, 1947, in the forms of collective bargaining through direct negotiation and conciliation, arbitration, and adjudication. If we analyze this, we will easily understand that the process is generally linear in its operation. The only exception in this regard is the power of the appropriate Government to refer the dispute directly for adjudication u/s 10 of the Act based on the theory of apprehension. Thus, the IDA, 1947, is the only comprehensive means of investigation, inquiry, and peaceful resolution of employment disputes, particularly collective disputes pertaining to the specific class of employees employed in any industry falling within the ambit of the term 'workman' defined under the Act. This is clearly amplified by the definition of the term 'industrial dispute' u/s 2(k) of the Act. By the Amending Act of 1965, individual disputes of workmen relating to their discharge, dismissal, etc., are dealt with u/s 2-A of the Act and further simplified by the later amendment in this regard. Therefore, any contract labor falling within the definition of the term 'workman' u/s 2(s) of the IDA, 1947, can seek remedy against his unlawful discharge, dismissal, or retrenchment u/s 2-A. But the respondent should be the immediate employer viz., the contractor unless the cause of action can also be attributed to the Principal Employer for whose benefits the contract labor was engaged as such.
The provision for appeal against dismissal found in the States' Shops and Establishments Acts and other establishment-specific laws could have triggered this question. This was due to the absence of the provision for discharge, dismissal, etc., of individual employees under the IDA, 1947, till 1965. Such a provision of appeal is not included in the subsequent Acts like the Model Shops and Establishments Rules, 2016, and the Maharashtra Shops and Establishments Act, 2017.
The CLRA A, 1970, is a comprehensive legislation to regulate as well as to abolish the indirect form of labor through the contractors, and as such, it does not provide for the direct absorption of contract labor even if it is prohibited by section 10 of the Act unless the contract is proved to be sham as observed by Mr. Madhu. Therefore, the contract labor can raise collective disputes as well as individual disputes under the IDA, 1947, for their employment grievances against both the contractor and the PE, if the dispute fastens vicarious liability on the PE or only against the respective contractor if otherwise.
From India, Salem
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Before coming to the ultimate query, I think it is pertinent to look into the scheme of redressal of industrial employment grievances under the existing labor laws in India.
The first and foremost mechanism of dispute resolution has been provided under the Industrial Disputes Act, 1947, in the forms of collective bargaining through direct negotiation and conciliation, arbitration, and adjudication. If we analyze this, we will easily understand that the process is generally linear in its operation. The only exception in this regard is the power of the appropriate Government to refer the dispute directly for adjudication u/s 10 of the Act based on the theory of apprehension. Thus, the IDA, 1947, is the only comprehensive means of investigation, inquiry, and peaceful resolution of employment disputes, particularly collective disputes pertaining to the specific class of employees employed in any industry falling within the ambit of the term 'workman' defined under the Act. This is clearly amplified by the definition of the term 'industrial dispute' u/s 2(k) of the Act. By the Amending Act of 1965, individual disputes of workmen relating to their discharge, dismissal, etc., are dealt with u/s 2-A of the Act and further simplified by the later amendment in this regard. Therefore, any contract labor falling within the definition of the term 'workman' u/s 2(s) of the IDA, 1947, can seek remedy against his unlawful discharge, dismissal, or retrenchment u/s 2-A. But the respondent should be the immediate employer viz., the contractor unless the cause of action can also be attributed to the Principal Employer for whose benefits the contract labor was engaged as such.
The provision for appeal against dismissal found in the States' Shops and Establishments Acts and other establishment-specific laws could have triggered this question. This was due to the absence of the provision for discharge, dismissal, etc., of individual employees under the IDA, 1947, till 1965. Such a provision of appeal is not included in the subsequent Acts like the Model Shops and Establishments Rules, 2016, and the Maharashtra Shops and Establishments Act, 2017.
The CLRA A, 1970, is a comprehensive legislation to regulate as well as to abolish the indirect form of labor through the contractors, and as such, it does not provide for the direct absorption of contract labor even if it is prohibited by section 10 of the Act unless the contract is proved to be sham as observed by Mr. Madhu. Therefore, the contract labor can raise collective disputes as well as individual disputes under the IDA, 1947, for their employment grievances against both the contractor and the PE, if the dispute fastens vicarious liability on the PE or only against the respective contractor if otherwise.
From India, Salem
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Thank you very much, Madhu ji and Umakanthan ji, for participating and for enlightening me on this issue. It is clear that the definition of Sec. 2(s) of ID Act would attract the contract laborer, though it is not expressly included (as in the case of an apprentice) in the definition as a contract laborer or by any other name. Furthermore, since there is a separate mechanism existing within the Shops and Establishments Act for the workers working in shops and establishments, and this enactment is not applicable to the contract laborers working in factories, according to the illustration provided by Mr. Umakanthan ji, the ID Act only provides the remedy for them in case of disputes. Am I right, sirs?
From India, Visakhapatnam
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From India, Visakhapatnam
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Dear Mr. Kesav Panda,
In the captioned matter, Mr. Umakanthan has already provided his valuable guidance, as well as Mr. Madhu.
The principal employer would definitely come into the picture if engaged directly or where the contractor did not obtain the CLR&A license. Any retrenchment without adhering to laws pertaining to retrenchment or termination falls under the purview of the ID Act.
Furthermore, there are provisions in state CL-R&A rules where a laborer can be terminated directly without referring to the ID Act, provided the labor termination falls under such service conditions.
Therefore, every employer should follow the provisions available in the state rules of the CL(R&A) Act.
From India, Mumbai
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In the captioned matter, Mr. Umakanthan has already provided his valuable guidance, as well as Mr. Madhu.
The principal employer would definitely come into the picture if engaged directly or where the contractor did not obtain the CLR&A license. Any retrenchment without adhering to laws pertaining to retrenchment or termination falls under the purview of the ID Act.
Furthermore, there are provisions in state CL-R&A rules where a laborer can be terminated directly without referring to the ID Act, provided the labor termination falls under such service conditions.
Therefore, every employer should follow the provisions available in the state rules of the CL(R&A) Act.
From India, Mumbai
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