PROVISIONS RELATING TO CONTRACT EMPLOYEES
Many organizations, in the form of housekeeping employees, security guards, cafeteria personnel, etc., hire contract workers. These entities-as the major employers-must ensure compliance on a variety of fronts by statute. A fast read of your duties, and a booting checklist!
Land law requires that compliance be maintained at all times with regard to the wages and benefits of all employees deployed on your premises, whether direct or indirect. You-the principal employer-are responsible for the enforcement of both these direct workers and contract or indirect workers.
If the main employer hires 20 indirect workers, he must ensure that the Contract Labor Act provides for a licensed certificate. That is the fundamental premise of the Act. It also mentions benefits, such as drinking water, proper urinals, etc., and maintaining the Contract Labor Act register. In case you do not meet the requisite number of workers, all records and registers are to be kept under the Minimum Wages Act / Payment of Wages Act.
The mandatory PF deductions are also to be made for all employees who receive basic wages of less than Rs.15000. This covers direct and indirect employees, or contract staff. Even if you hire only 5-6 indirect employees which then take your total number of employees to more than 20, you need to register under the PF Act and ensure compliance is maintained.
If your organization's overall headcount with a gross wage of less than Rs.21000 is more than 20, then the Workplace State Insurance Act applies to you. In the case of factories the headcount level is 10. This act also covers direct as well as indirect employees. It is also noteworthy here that ensuring that all contract employees hold an ESI card is the responsibility of the principal employer.
The main employer is also to ensure that the employees receive minimum wages.
As a principal employer, the evidence of payment of wages to secondary workers must be obtained. Such payment can not be made in cash but only by bank transfer (on or before the seventh of the month) or check (before the seventh of the month).
Significant employers shall ensure that Form C and Form D are retained by the Contractor under the Bonus Act. In addition, it would be useful to collect Form F from the contractor in cases where there may be mishaps or accidents. The principal employer shall preserve and monitor all compliances with respect to gratuity.
You-as a principal employer-must also have a copy of the certificate of registration pursuant to the Respective State Social Welfare Fund Act, failing to provide fines that could be incurred. The registration copy may be produced within 7 days of inspection. It is notable here that the 12-hour contracts are non-compliant. The law allows only eight-hour working days, adding up to a total of 48 hours a week.
Main accordance with the Principal Employer (P.E.) Checklist under the Contract Labor Act, 1970 [CLRA] (TO BE READ WITH STATE RULES) Correct agreement between the Principal Employer and the Contractor should be drawn up.
In contracts with contractors, contractual requirements regarding contract labor workers should be integrated. This makes contractors accountable to the Principal Employer by contract.
Contractor should be engaged for the reason set out in the Principal Employer's Registration Certificate, and should have employees within the maximum limit set out in the Principal Employer's Registration Certificate.
The representative of the Principal Employer should be present and sign the Payment Register token of the Contractor who disbursed the salary in his presence or review the bank transfer statement along with the PF and ESI challans and then his bills must be cleared. (Ultimate Responsibility for Principal Employer: if Contractor does not pay Contract Labor employees then the Principal Employer will be responsible for it and will have to pay) Registration of the Establishment by Principal Employer, if 20 or more workers are employed as Contract Labor employees, and registration certificates to be obtained by Principal Employer.
Principal Employer shall be responsible for compensation, statutory fees, e.g. PF, ESI, PT, Incentive, Free etc., payable to employees of Contract Labor.
It is best to engage in non-perennial and incidental / ancillary job contract labour. Contract labor should not be engaged in main establishment operations but in ancillary activities – otherwise the same wages / wages and terms of service must be offered to Contract labor as given to Regular Employees [Reason: Standard License Requirement granted to Contractors pursuant to CLRA State Rules] Legislative registers and records to be maintained Registry of Contracts
Land law requires that compliance be maintained at all times with regard to the wages and benefits of all employees deployed on your premises, whether direct or indirect. You-the principal employer-are responsible for the enforcement of both these direct workers and contract or indirect workers.
If the main employer hires 20 indirect workers, he must ensure that the Contract Labor Act provides for a licensed certificate. That is the fundamental premise of the Act. It also mentions benefits, such as drinking water, proper urinals, etc., and maintaining the Contract Labor Act register. In case you do not meet the requisite number of workers, all records and registers are to be kept under the Minimum Wages Act / Payment of Wages Act.
The mandatory PF deductions are also to be made for all employees who receive basic wages of less than Rs.15000. This covers direct and indirect employees, or contract staff. Even if you hire only 5-6 indirect employees which then take your total number of employees to more than 20, you need to register under the PF Act and ensure compliance is maintained.
If your organization's overall headcount with a gross wage of less than Rs.21000 is more than 20, then the Workplace State Insurance Act applies to you. In the case of factories the headcount level is 10. This act also covers direct as well as indirect employees. It is also noteworthy here that ensuring that all contract employees hold an ESI card is the responsibility of the principal employer.
The main employer is also to ensure that the employees receive minimum wages.
As a principal employer, the evidence of payment of wages to secondary workers must be obtained. Such payment can not be made in cash but only by bank transfer (on or before the seventh of the month) or check (before the seventh of the month).
Significant employers shall ensure that Form C and Form D are retained by the Contractor under the Bonus Act. In addition, it would be useful to collect Form F from the contractor in cases where there may be mishaps or accidents. The principal employer shall preserve and monitor all compliances with respect to gratuity.
You-as a principal employer-must also have a copy of the certificate of registration pursuant to the Respective State Social Welfare Fund Act, failing to provide fines that could be incurred. The registration copy may be produced within 7 days of inspection. It is notable here that the 12-hour contracts are non-compliant. The law allows only eight-hour working days, adding up to a total of 48 hours a week.
Main accordance with the Principal Employer (P.E.) Checklist under the Contract Labor Act, 1970 [CLRA] (TO BE READ WITH STATE RULES) Correct agreement between the Principal Employer and the Contractor should be drawn up.
In contracts with contractors, contractual requirements regarding contract labor workers should be integrated. This makes contractors accountable to the Principal Employer by contract.
Contractor should be engaged for the reason set out in the Principal Employer's Registration Certificate, and should have employees within the maximum limit set out in the Principal Employer's Registration Certificate.
The representative of the Principal Employer should be present and sign the Payment Register token of the Contractor who disbursed the salary in his presence or review the bank transfer statement along with the PF and ESI challans and then his bills must be cleared. (Ultimate Responsibility for Principal Employer: if Contractor does not pay Contract Labor employees then the Principal Employer will be responsible for it and will have to pay) Registration of the Establishment by Principal Employer, if 20 or more workers are employed as Contract Labor employees, and registration certificates to be obtained by Principal Employer.
Principal Employer shall be responsible for compensation, statutory fees, e.g. PF, ESI, PT, Incentive, Free etc., payable to employees of Contract Labor.
It is best to engage in non-perennial and incidental / ancillary job contract labour. Contract labor should not be engaged in main establishment operations but in ancillary activities – otherwise the same wages / wages and terms of service must be offered to Contract labor as given to Regular Employees [Reason: Standard License Requirement granted to Contractors pursuant to CLRA State Rules] Legislative registers and records to be maintained Registry of Contracts