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Labour
(Regulation
& Abolition)
Act, 1970
Applicability
Establishment
Contractor
Exception
Important Definitions
Contract Labour (S. 2(1)(b))
He must be a workman
He is hired by or through a contractor
He is hired in or in connection with the work of an establishment
Knowledge of his engagement to the Principal Employer is immaterial
Workman
Out worker
Important Definitions..
Contractor S. 2(1)(c)
A person who undertakes to produce a given result for the establishment
through contract labour
A person who supplies contract labour for any work of the establishment
Sub-contractor
Mere supplier of goods or articles of manufacture to establishment is NOT a
contractor
Important Definitions
Appropriate Government S. 2(1)(c)
Reference to the Industrial Disputes Act, 1947
Always decided with respect to the establishment and not the contractor
Registration
Application of registration to be made within the prescribed time from
the date the Act becomes applicable
PE cannot employ contract labour if registration not done
Forms
FORM I Application of Registration
FORM II Certificate of Registration
Revocation of Registration
Misrepresentation
Suppression of facts
Other reason rendering the registration useless/ineffective
License
Application of license to be made for each work that the contractor
undertakes
License may include conditions like hours of work, fixation of wages, etc
Application to be made to Licensing Officer appointed by AG
Forms
FORM IV Application of License
FORM V Certificate by PE
FORM VI License
Revocation of License
Misrepresentation
Suppression of facts
Failure to comply with the conditions of license
Welfare amenities
Canteen
Work requiring CL likely to continue for prescribed period (6 months)
100 or more CL ordinarily employed by contractor
Rest-Rooms
Work requiring CL likely to continue for prescribed period (3 months)
CL likely to halt at night in connection with the work of establishment
Other facilities
Drinking water
Latrines, Urinals & Washing facilities
First-aid box equipped with prescribed contents
Wages
Wage
As defined in Payment of Wages Act, 1936
For Scheduled employments, wage cannot be less than Minimum Wage
For same or similar kind of employment, wage should be the same as
regular employees
Wage period cannot exceed one month
If CL<1000 in an establishment, wage to be paid before expiry of 7 days
from last day of wage period
If CL>= 1000, then 10 days
Contractor to ensure disbursement of wages in the presence of the
Authorised Representative of the PE
Liability of PE
Amenities, if not provided by the contractor within the prescribed time,
should be provided by PE
Wages, if not paid by the contractor within prescribed time, or short
payment is made, the full or unpaid balance should be paid by PE
When PE provides amenities, and/or pays wages of CL, he can recover
the amount from the contractor:
By deduction from amount payable to contractor, or
As a debt by the contractor
These provisions ensure that the facilities and wages of the CL are
secured
Consultation
with Board
Consideration
of relevant
factors
Notification
Important Judgments
Dena Nath v. National Fertilisers Ltd
If CL employed without registration/license, penal provisions will be attracted
The CL so employed will not automatically become regular employees of PE
SAIL I case
Prohibition of CL will not lead to automatic absorption of CL (overruled AI)
Consultation with Board and consideration of S.10(2) before prohibition
SAIL II case
Labour Court or Writ Court cannot prohibit employment of CL
Risk Factors
Same or Similar Kind of work
If CL perform same or similar kind of work as the regular employees of PE:
Wage rates
Holidays
Hours of work
Other conditions of service to be same as regular employees
Questions
from the Past
Canteen
License
A leading FMCG major Piyo & Giyo wants to use CL for loading
and unloading raw material/finished goods inventory.
The Labour Commissioner refused to give license on the ground
that loading and unloading is a core activity (his contention is that
if loading and unloading is stopped the plant will also stop and
hence it is a core activity).
Prohibition of employment
In a particular motorcycles factory of Zero Corp, CL are deployed
for the daily cleaning and maintenance of machines. The Central
Government sent a notice to the factory manager declaring that
employment of CL in daily cleaning and maintenance of machines
was being prohibited from next week for that particular factory.