Including the excluded : A study of the impact of contract labour

�Including the Excluded

Members of the Study Team

Adv. Shrikant DharapSenior Advocate, Bombay High Court,

Senior functionary of Bharatiya Mazdoor Sangh (BMS) for the last over three decades

Tel. 9� 22 26478754 Mobile 982�47�767

Adv. Vinay MenonAdvocate, Bombay High Court

Yashwant ThakarAdvisor, RMP’s Centre for Development, Planning and Research

Suryakant ParanjapeSenior Functionary, BMS and Bharatiya Shramshodh Mandal

Documentation Consultants

Pulind Samant, Mumbai

Niranjan Welankar, Vasai

Project Coordination

Mrudul Bapat,Project Officer, Rambhau Mhalgi Prabodhini, Mumbai

�Including the Excluded

Including the ExcludedA Study of the Impact of Contract Labour

(Regulation and Abolition) Act, �970

S M Dharap Advocate, Bombay High Court

Mumbai Office:

�7, Chanchal Smurti, G.D. Ambekar Road, Opp. Shriram Industrial Estate,Wadala, Mumbai - 400 03�.

Tel: 022 - 24�6 6966 / 24�8 5502, Fax: 022 - 24�5 6725.

RMP - KEC:

Keshav Srushti, Essel World Road, Uttan Village, Bhayander (West), Thane - 40� �06. Tel: 022 - 2845 0�0�, Fax: 022 - 2845 0�06

Website: http://www.rmponweb.org

2 Including the Excluded

Including the ExcludedA study of the Impact of Contract Labour(Regulation and Abolition) Act, �970

© Rambhau Mhalgi PrabodhiniAll Rights reserved.

By: S. M. Dharap, Advocate, Bombay High Court

Price : Rs. �50/-

Publication No.: Gen./ B / Eng. /7� / 20�2-�3(�)ISBN 978-8�-903837-5-2

Date of Publication: April 30, 20�2

Publisher:Anand ShidhayeRambhau Mhalgi Prabodhini�7, Chanchal Smruti, G. D. Ambekar Marg,Opp. Shriram Industrial Estate, Wadala, Mumbai- 40003�Tel. + 9� 22 24�3 6966, 24�8 5502 Fax: + 9� 22 24�5 6725E-mail: [email protected]: http://www.rmponweb.org

Printed at:Rachana MudranDadar, Mumbai.Tel. +9� 22 24�244�0

Designed by:Reflections,Mumbai.Tel. 9820�30094

3Including the Excluded

Contents

S. No. Topic Page No.

�. List of Tables 4

2. Preface 5

3. Background 7

4. Chapter I: Research Design 9

5. Chapter II: Literature Review �2

6. Chapter III: Case Law and the Role of Judiciary 23

7. Chapter IV: Data Analysis 34

8. Chapter V: Views of Trade Unions 62

9.Chapter VI: Views of Law Practitioners, Consultants & Educationists

70

�0. Chapter VII: Conclusions 73

��. Chapter VIII: Recommendations 76

�2.Annexure I: Contract Labour (Regulation and Abolition) Act, �970

78

�3.Annexure II: Conclusions of Workers Symposium on Policies and Regulations to Combat Precarious Employment (Geneva, 4 – 7 October 20��)

9�

�4. Annexure III: Interview Schedules 96


List of Tables

Sr. No. Title

�. City- wise distribution of respondents

2. Type of Units

3. Types of Management or Ownership

4. Age Wise Distribution of contract workers

5. Education of Contract Workers

6. Number of Dependents

7. Ownership Pattern of Residence

8. Number of Migrants.

9. Periods of Work

�0.Distribution of contract workers According to CompaniesWhere They Have Worked

��. Number of Years Working with the current Contractor

�2. Nature of Work

�3. Engagement in Any Productive/ Main Work

�4. Average Wages

�5. Wages According to Type of Unit

�6. Place Wise Wages

�7. Salary Received in Last 3 Years

�8. Facilities. (Only Positive Responses)

�9. Awareness About the Act

20. Available Staff in the Offices of the Assistant Labour Commissioners

2�. Details of Licenses Issued and Number of contract workers

22. Details of Inspections Carried Out

23. Enforcement of Contract Labour (R and A) Act, �970 (96-00)

24.No. Of Cases Received / Disposed of During the Last Five Years under Rule 25 (2) (v) (a) and (b) of the Contract Labour (R and A) Central Rules, �97� Relating to Payment of Wages (96-00)

25. Enforcement of Contract Labour (R and A) Act, �970 (04- 08)

26.No. Of Cases Received / Disposed of During the Last Five Years under Rule 25 (2) (v) (a) and (b) of the Contract Labour (R and A) Central Rules, �97� Relating to Payment of Wages (03-06)

27. National figures about cases


PrefaceThe Contract Labour (Regulation and Abolition) Act �970 (hereinafter referred to as the Act) has been in force for last 42 years. During these 42 long years several changes have occurred in the industrial sector. Especially after opening the economy in the early nineties and globalisation, the industrial picture of India has changed completely. Adoption of high-tech methods for the production and the quality of the products has assumed an exceptional importance, primarily because of the market oriented business and industrial policies adopted by the Government as well as by the practices of industrialists/businessmen. It has also extremely affected the employer - employee relations. Output and profitability have assumed greater importance, encouraging some employers to bypass or find loopholes, in the laws enacted for protection of the interests of the workers, with the sole objective of achieving higher productivity, which in turn has affected this relationship. One of such laws which was passed for the protection of the contract labour was the Act, Contract Labour (Regulation and Abolition) (CLRA) �970. The decisions by the Courts, in respect of this law, are now being used for the purposes contrary to the purpose for which the Act was enacted.

Our Constitution, enjoins the responsibility on each of the four factors of production, which should consider each other’s interest in this era of cooperation. However this shared responsibility has been largely ignored.

We met several Trade unionists, lawyers and such other persons who have worked in the field for long time. We tried to analyse and find out as to what is the reason for this Act becoming impracticable and redundant and whether it should be repealed or amended and if amendment is to be carried out, what can be the basis on which we can arrive at relevant conclusions for suggesting amendments or whether a fresh legislation should be enacted by incorporating such provisions which can be expected to fulfil the objects of the Act and also remove its shortcomings.

It was thus necessary to approach some leaders of the labour unions, employers’ associations, and lawyers appearing on both sides, contractors and contract workers to gather impartial and unbiased information to arrive at relevant conclusions. An approach under Right To Information Act was required to be made wherever information from the Government machinery was not readily available.

The project was conceived by Adv. Shrikant M. Dharap, a senior lawyer specialising in labour law, practising in Bombay High Court. He is also one of the senior national level functionaries of the Bharatiya Mazdoor Sangh (B.M.S.), a leading labour organisation in India for the last over three decades. He was duly assisted by a team comprising Adv. Vinay Menon, Yashwant Thakar and Suryakant Paranjape.

We must say that our endeavour was not easy one as we found a lot of psychological resistance on the part of employers and surprisingly even some unions, in furnishing


the information sought. Certain employers went to the extent of prohibiting the entry of the researchers of Rambhau Mhalagi Prabodhini.

The work was carried out in spite of all such difficulties. Accordingly, a report was prepared and the conclusions drawn, which are being presented in this report. We also would like to make certain recommendations, which are stated separately.

The exercise was not undertaken with an objective of finding fault or assigning blame, but only with an earnest desire to ascertain, as to whether, the present Act, with the interpretations placed by the Hon’ble Supreme Court and High Courts have helped in achieving the objectives of the Act for which it was enacted and if it is so, what are the other factors responsible for that. While researching the topic from various angles, we did come across a few other similar studies undertaken in the past by different institutions and organisations, which we have taken due cognisance of in the body of the report, wherever appropriate.

We hope this report serves the cause of the most under previliged and highly neglected class of unorganised labour in our country. To that end this report very clearly tries to point out the gaping inadequacies in the whole system including the Act itself and its present day administration.

Last but not the least, it is only necessary to thank some people and appreciate their effort in making this project a meaningful one. As aforesaid, Adv. Dharap has been the initiator and the leading light throughout. He successfully solicited strong contributions to the body of the project, through all his team members. Adv. Dharap was so very keen about the success of this project that he voluntarily took pains to organise some financial support through his personal friends. Some valuable assistance was rendered by some other of his such as members of Labour Law Practitioners’ Association, Mumbai, Thane, Nashik and Pune trade unionists and representatives of employers’ associations and that too at their own costs. We are grateful to all of them.

Vinay SahasrabuddheDirector General

Rambhau Mhalgi Prabodhini April 30, 20�2


BackgroundThe triggering point of this project was the judgment of the Supreme Court in Steel Authority of India Case which caused us to refer back to the history, the purpose and the object of the legislation known as Contract Labour (Regulation and Abolition) Act. �970. When we refer to the background of the legislation, which is almost fully covered in the case of Standard Vacuum Company Vs. Its workmen, 1960 (Supreme Court), which emphasised on the condition then prevailing that in absence of any legislation or rules dealing with the conditions of service of the contract labour, the workers were being exploited by the Industrialists.

We presume that the Hon’ble Supreme Court, in the said judgment, had rightly given the guideline to the Government and as a matter of necessity, the Bill came to be placed in July �967 before the parliament, which resulted the Contract Labour (Regulation and Abolition) Act of �970. All the judgments delivered by the Supreme Court thereafter, right up to the 200� Case of Steel Authority of India Ltd., were studied and pondered over, resulting in a disturbed state of mind about not so positive results of the decisions reached in respect of this Act. The �st Case of the Supreme Court, in �97�, separated the cases under this Act from the coverage of Industrial Disputes Act �947, on the ground that the new legislation was a special legislation dealing with the subject matter under the Act and therefore, ousted the jurisdiction of the forum under the I. D. Act �947.

Alternative to this machinery was the creation and the formation of the State and Central Advisory boards which was in the nature of an administrative body which was made the sole alternative to the I.D. Act expecting that the machinery of the boards would resolve all the issues. Strangely, these boards were not given any judicial powers with a binding effect. This resulted in taking away the rights of the concerned workmen to approach the Court under any law and who could not knock the doors of any judicial forum having powers to deal with various aspects arising out of the dispute. The Act more relies on the Government machinery functioning under the Department of the Labour which in fact, as our experience goes, is totally inefficient, inadequate and in some cases corrupt.

Another case in point and that too of recent origin is that of Jupiter Life Line Hospital, Thane (Arbiter, Jan.’��) had engaged over 500 contract labour in various jobs, 77 of whom were engaged through one agency viz. ‘Rare Hospitality Services’ for housekeeping work, which they had been doing continuously for 5 years, ever since the said hospital was established. In March 2009, the said contract labour was transferred arbitrarily to distant places in and around Mumbai. As they were earning between Rs. 3000 and Rs. 4000 a month, they couldn’t manage the conveyance expenses, consequent to said transfers. They complained to the State Labour Ministry, who after going through the facts of the case, abolished the said contract work, but the complainant workers lost their jobs, as there was no provision in law, for prohibiting


the practice as an interim relief on receipt of the complaint or/and for regularisation of their services post abolition and. Thus it was a victory in principle for them, but which brought along the ‘gift’ of job-loss.

All these and such other shortcomings resulted in denial of justice to the workers, upon the abolition of contract and the regularisation of their employment with the principal employer and in fact prolonged the dispute where approach was only to the High Court. In the intervening period several judgments show that technicalities crept in, as a result of which, instead of dealing with the main issue, the Courts got involved in dealing with the technical issues. This resulted, unfortunately, in keeping aside the main issue of abolition of the employment of contract labour and regularisation with the principal employer or regulating their conditions of service to a possible extent, wherever such regularisation was not possible. The classic example is of the judgement of the Steel Authority of India Ltd., where the main issue was as to the definition of the term “Appropriate Government”. All these exercises undertaken by the SC resulted in the continuance of Contract labour in the same status in which they were placed and denying all hopes of contract workers in getting the status of permanency with the principal employer. The study of cases also shows that the Courts have deviated themselves from the earlier principles laid down by them while interpreting the provisions of law. The glaring example is of statutory and non-statutory canteens. The variation in various pronouncements and the approach of the Courts has, according to us, resulted in making the Act redundant or inapplicable. We also thought that the interpretations made by the Hon’ble Courts, have deviated from the philosophy of labour jurisprudence, as espoused by the earlier decisions of the Hon’ble Supreme Court.


Chapter I

Research Design

1. Objectives of the StudyIn this study efforts are made to find out whether any improvement or changes have occurred in the conditions of the contract labour by the implementation of the Act and whether the purposes for which this law was enacted have been fulfilled. Keeping in mind this main objective, following points were proposed to be studied in details, during this survey:

�.� To find out the present conditions of the contract workers in the context of the Act by visiting and interviewing them and to find out the conveniences and facilities available at their work places.

�.2 To understand the mechanism and methodology of the implementation of the Act.

�.3 To carry out comparative study of the various cases and decisions of the courts thereon in respect of the implementation of the provisions of the Act.

�.4 To examine the roles of the various players in the effective implementation of the Act.

�.5 To study and discuss the deficiencies and shortcomings in the provisions of the Act.

�.6 To consider the utility of the Act and also suggest the improvements required to be made in the Act.

2. Scope of the StudyIt covers a limited industrial zone of the Maharashtra state. Industrial areas viz. Mumbai, Pune, Thane, Nashik and Aurangabad were selected for this study.

Some Government establishments have been included in this study because there is a good proportion of the contract labour in such Government establishments. Thus this survey is restricted to the workers appointed as contract workers and for whom the Act is applicable.

3. Research Questions and Items of InformationA questionnaire was prepared for interviewing them and was tested prior to actual start of the survey. The questionnaire was finalised on the basis of the findings of the pre-testing. These contract workers were contacted at the following places:

�0 Including the Excluded

Their actual places of work.

In or out of the premises of work, but at the time of their lunch break or after their work hours were over.

Offices of the trade unions.

Offices of the Assistant Labour Commissioners.

Their residences.

The work of contacting these labourers and eliciting information from them was the most difficult task of this study. These labourers were afraid that if they provide the information asked for, they may lose their jobs. They were afraid of the intimidation by the contractors. Hence they were required to be contacted in a number of ways. The method of direct interviews was adopted for collecting necessary information for this survey. The workers from large, medium and small scale private industries as well as those from Government or Semi-Government establishments were selected for this study.

The other constituents related to the Act were also contacted and interviewed with the help of different FGD checklists designed for the purpose and the data was collected from them. These constituents include:

Contractors supplying labour.

Industrialists or owners of the businesses.

Officer in charge of administration and welfare in industry / business.

Labour advisors / consultants.

Trade union officials.

Association of employers.

In addition, the officials of the Labour Commissioner who are entrusted with the task of implementation of the Act were also contacted. Discussions were held with the Assistant Commissioners, Government Labour Officers and the Inspectors working under them.

It was also necessary to obtain authentic information in this context from the Government authorities. Offices of the Assistant Labour Commissioners were visited a number of times and efforts were made to obtain the necessary information. But we could not get any response from them. The required information was therefore obtained by resorting to the Right To Information Act (RTI).

In this entire study, the Library Research was also equally important. The literature available in respect of the Act was carefully gone through. Similarly the reports of the discussions in the Loksabha in this regard, were also studied. This pilot study being related to the Maharashtra State, Labour Policy of the state was also studied. As a part of this study, members of the study team also participated in seminars, symposia, and workshops pertaining to the topic under study.

��Including the Excluded

Efforts were also made to collect information about the case studies related to this subject. For this purpose the offices of the trade unions as well as the Assistant Labour Commissioners and other such authorities were contacted. But except for one case of Pune Municipal Corporation (PMC) establishment, in no other case- information could be collected for the detailed study. The detailed information of that case (PMC) has however been collected.

Information about the movements organised by various trade unions in this context of laws concerning contract labour, the resolutions passed, efforts made for the regulations and various cases raised by them has also been collected for this study. This is because the role of the trade unions was very important for the successful implementation of the Act and as such it was obligatory to take a note of the same for this study.

It was also absolutely essential to obtain the details of the decisions of the various courts in this regard, for this study. Effort is made for carrying out comparative study of the main judicial decisions in this matter, during this survey.

Besides the above a number of focussed group discussions were also arranged independently, with the concerned players.

4. Sampling Universe

Sampling universe for this study was the contract labours in industrial areas of Thane, Pune, Nashik and Aurangabad cities in Maharashtra.

5. Sample Size and Method

It included views of 57� contract labours from industrial areas of the cities along with a few FGDs of contractors and other key- persons related to labours. For this project random sampling method was used.

6. Tools and sources of Data Collection

Major tool of data collection was the interview schedules for the contract labour respondents. Mostly primary sources of data were used. Also, to complement the interview schedules, Focused Group Discussions (FGDs) were conducted with some contractors and key persons in order to understand their perspectives.

7. Data Analysis

Tabular and descriptive analysis of data was conducted.


Chapter II

Literature Review In order to have a comprehensive approach towards the subject of research a review of the past work in this regard is essential. The past work majorly consists of work done at the government level and initiatives of non-government agencies.

Firstly let us review the documents produced by the government and allied organisations.

I. Review of Government DocumentsIt is seen that there are �7 different forms required to be filled in as per the Act. Details of the same are given in the Annexure I. It is difficult to scrutinise these large number of duly filled in forms. The facilities of computerisation available in the offices of the labour commissioners are greatly insufficient. This is a matter of grave concern. These inadequacies are visible even to any casual visitor to the offices of the labour commissioners, who are entrusted with the task of implementation of the Act. The cases for regulation and abolition under this Act are received by the offices of the State and Central Advisory Boards. But owing to the delay in these cases being sent to these boards the contract workers whose cases are referred do not get justice as they are no longer in the employment of the same contractor. When asked about the numbers of meetings held by these boards, it was stated that only 74 meetings of the Central Advisory Board are held so far. The information about the State Board meetings was not available.

A special group was appointed in accordance with the recommendations of the Indian Labour Conference (ILC) held on 20-2� February 2009 for the protection of the interests of the contract workers under the Act. So far 4 meetings of this group have been held. The report of this group was expected to be received by 3�st December 2009. However the report is not readily available.

Similarly a Central Industrial Relations Machinery (CIRM) has also been appointed under the chairmanship of the Chief Central Labour Commissioner. The work of implementation of the provisions of the Act has been entrusted to this machinery.

But all these arrangements are found to be severely wanting in protection of the interests of the contract workers.

There are a number of provisions in the Act, from registration to issuance of the license, after issuance of the license inspection of the industries, to take cognizance of the complaints when received and cancellation of licenses etc. But because of the insufficiency of the implementing machinery, and basically because of the

�3Including the Excluded

unwillingness on the part of the existing machinery, enforcement of the provisions of the Act is not effective, and now that the provision for approaching the courts of law for removing the injustice done to the contract workers has not been for in this Act, this machinery has become absolutely toothless.

Standing Labour Committee SessionIn the 44th session of the Standing Labour Committee (20��), the following was mentioned:

As far as the issue of amendments in the Act and its Rules are concerned, a proposal for the amendments was prepared. However, it was found desirable to have an impact study of the proposal on the economy and financial implications for the Central and the State Governments, including different sectors of production and employment which depend on labour as one of the important input. The V.V. Giri National Labour Institute, NOIDA was entrusted with the task and they have submitted their study report. The report is now being examined by the Government

Apart from the above, the following resolutions were passed unanimously in the said session:

i) All efforts should be made to ensure that the existing provisions of the Act and the Rules made there under are implemente in letter and spirit.

ii) The labour enforcement machinery in the Centre and the State should be strengthened by providing requisite manpower and other logistic facilities so as to ensure effective implementation of labour related legislations.

iii) States are mandated to constitute Tripartite State Advisory Boards under the Act. However, it was pointed out that a number of states do not have such Boards constituted. It was unanimously resolved that such states should be asked to constitute such Boards at the earliest.

iv) Payments should be made to the contract workers through banks. Necessary amendments should be made in the Act/Rules.

It would be pertinent to take a quick stock of the happenings at the Government level as regards the subject.

Government of Maharashtra Labour PolicyGovernment of Maharashtra came out for the first time, with a proposal (draft) of its labour policy on 06/��/�0. It invited suggestions and objections on the same, from interested parties, whom they addressed as ‘social partners’. The said exercise was preceded by State level conferences involving all interested parties, under the


Chairmanship of Mr. Arun Maira, Member – Planning Commission, Government of India, on 26/08/�0 and 27/�0/�0.

It would be interesting to go through some excerpts from the background note prepared by the Government of Maharashtra, for the purpose of the conference dated 27/�0/�0, which are as below:

Employers favour contract labour as a means to give them flexibility they require in that they do not have to commit to permanent employees and the associated higher non-wage costs, for efficiency, competitiveness, lower wage cost, lack of employer-employee relations. It is argued that lack of any relation between productivity and wages, higher labour cost due to job security, pressure of trade unions to adjust workforce discouraged organised sector to expand employment. These factors are responsible for modernisation, substitution of capital for labour and tendency to employ contract labour to achieve productivity. It is also argued that due to rigid provisions in the Industrial Disputes Act, employers are unable to reduce workforce and hence reluctant to increase strength of permanent employees. Contract labour is one of the principal methods used by employers to gain flexibility in the labour market.

Currently contract labour are being liberally employed to perform even task which are regular, perennial and permanent in nature though the law prohibits employment of contract labour in such activities.

A few relevant salient features of the �st draft policy of the Government of Maharashtra, in the context of contract labour are as follows:

It has acknowledged contract labour as one of the vulnerable groups (page 6) as, “there is a need for targeted protection and assistance to some of the State’s most vulnerable groups including contract workers in both organised and unorganised sectors”.

It has also acknowledged the need for ‘capacity building for dept. of labour’ (page 36) as, “this will require the dept. to be strengthened, revitalised and probably restructured to give full effect to policy intentions and ensure adherence to the principles of good governance”.

It further acknowledges “the need to improve the overall efficiency and effectiveness of the labour inspection services”. (page 37)

Based on the suggestions / objections that may have been received in the meantime, the Government came out with the revised draft in 20��, which is yet to be made a policy. Its salient features in the context, are as follows:

Paragraph 4.�.2 talks about its intention to enforce effectively its earlier mandate under various labour laws about payments to labour through cheque/bank account only, both in organised and unorganised sectors.


Paragraph 5.� acknowledges the need for protection to contract labour as, “with more than 93% o Maharashtra’s workers engaged in the unorganised sector and a substantial number working as contract workers, extending protection to these workers poses a major challenge for the Labour Dept. since such workers would be numbering more than 40 million. For these workers, protection is virtually non-existent and the workers are caught in the low wage, low productivity trap where they have no voice, their safety an health considerations are largely ignored and other social security is non-existent”.

Paragraph 5.2.� acknowledges specifically the inadequacy of the Act as, “due to lacuna in the Act, which does not mandate regularising contract workers in case of abolition of contract, the abolition may not necessarily go in favour of the contract workers”.

Paragraph 5.2.3 promises to address the issue as, “the Dept. of Labour will facilitate discussions with the social partners with a view to deciding on a model/s that ensure/s both fairness and productivity. It would also work on amendments or legislations that will enable the implementation of the said model/s after being found suitable”.

The same paragraph, while discussing the proposed issue of incentivising flexibility by providing a loading factor to compensate contract workers against their loss of certain benefits, also doubts the fundamentals that may have formed the basis of said ‘flexibility’ as, “it is nonetheless necessary to re-examine whether flexibility necessarily results in enhanced productivity and competitiveness. This is because the employers are not incentivised to provide skill-upgrading, training and adequate safety and health provisions to contract workers, which may result in their lower productivity levels”.

The same paragraph also comments on the issue of the nature of contract work (under section �0 of the Act) as, “the State would also examine whether it would be appropriate to demarcate activities into core and non-core and limit contract. If however the core and non-core activity demarcation is worked upon, the State shall define the core activity and would prepare a list of no-core activities. Generally, contract labour would not be permitted to be engaged in core activities. However, for sporadic seasonal demand, such employment would be permitted. The non-core services like sanitation, housekeeping, canteen and eatery services, courier services, transport services etc. which are in the nature of support services like running of hospitals, clubs, educational or training institutions, guest houses etc. to be provided by other agencies would be permitted on the following conditions.....”.

The same paragraph also proposes as, “the Act should be amended to place the responsibility of payment of all non-wage benefits like bonus, gratuity, provident fund, earned leave encashment benefit, maternity benefit and all other such legal benefits, on the principal employer”.


Paragraph 5.4.2 mentions that the Government is considering amendment to chapter VB of the Industrial Disputes Act, changing its applicability to establishments employing 300 workmen, in place of current �00.

Paragraph 5.4.5 talks about a proposed amendment to Trade Unions Act, by introducing provisions to enable unorganised sector workers to form trade unions, where “the employer-employee relationship does not exist or is difficult to establish”.

Paragraph 5.�3.2 acknowledges “the need to prepare a staffing plan (for Labour Dept.) with reference to numbers, levels and deployment to ensure the fullest possible implementation of the labour policy”.

The same paragraph also acknowledges “the need to adopt a systematic and co-ordinated approach to staff training and development, to cater for induction, refresher and upgrading training and preparation of training material for labour officials as well as for the benefit of employers and workers, including establishment of a dedicated training cell within the dept.”.

Paragraph 6.2 comments on the dept.’s proposed computerised Labour Management System viz. ‘Mahashramm’ as, “it would have significant impact on inspections, considerably reducing the requirement of inspections since it will be possible to monitor compliance on on-line basis. Only in case that compliance does not happen, inspection would be required”.

Planning Commission Directives The planning Commission also constituted a pan-India working group for deliberating on future policy directives on the subject of ‘Labour Laws and Other Labour Regulations, consisting of representatives of all interest groups, in April 20��. The points as regards the topic of contract labour, that figured in the agenda for the meeting of the said working group on 20/05/��, were as under:

Point no. �0 consisted of the matters that can be considered for suitable amendments in concerned statutes. The 3rd bullet point under the same mentioned, “Contract labour shouldn’t be engaged for core production/service activities”.

Point no. 28 mentions, “Regular workers are getting substituted by contract labour, in the on-going process of liberalisation/ privatisation/globalisation. Various studies show differences in wage rates, work hours, holidays, social security applicable to permanent and contract workers. There is a need to have a law to prevent exploitation of contract labour.

Point no. 3� enumerates the matters proposed to be considered for amendment to the Act as, “give effect of same wage rate, working hours, holidays and social security to the contract labour (to be mentioned in the agreement between principal employer and contractor), as available to the


regular workers, if the work performed is same or similar. The Act may be made applicable to establishments where the number of contract labour is �0 or more”.

Moreover, a private member’s bill (no. XI of 2002) was moved by one Shri Ramchandra Khuntia (MP) in the Rajya Sabha where inter alia several proposals for amendments were made. It was proposed that the section �0 of the Act should be amended so as to ensure regularisation of the contract workers’ services in a particular establishment where they were found to have been engaged in the tasks/processes/operations that could be termed as of perennial nature. Although the said proposal was important and so much necessary, it has yet to see the light of the day. It appears that this bill now lapsed.

CommentsThe readers, after going through the whole quoted text above, can easily notice practical acceptance by the Central as well as State Governments of the failure of their policies as incorporated in the Act and enforcement thereof for last over 40 years, with an expression of their intentions to handle things appropriately in future.

II. Review of Studies through private initiatives and Other PublicationsWe believed that a study of this volume would attain the state of comprehensive coverage, by going through similar studies or research papers, articles and other publications on the subject, that may have taken place in the past, and acknowledge notable contributions from there. The relevant excerpts from among the same, are presented below:

i. Study Report by Bharatiya Sharmshodh Mandal, Pune (1996):

It was a peripheral study of contract workers and their socio-economic conditions. It was taken up in Jan-Feb.,’96 in four districts of western Maharashtra viz. Pune, Ahmednagar, Sangli and Solapur. Their observations are reproduced in the following bullet points.

Contract labour which accounts for a significant proportion of the total labour force in the large scale industries, is also the most disgruntled and depressed as well as exploited segment of the workforce.

After independence, the Central as well as State Governments Enacted different legislations and consequent rules and regulations, to safeguard welfare and interests of the labour class. However, the machinery to implement the said legislations and rules thereunder was neither adequate nor vigilant enough to do the same.


Earlier, the operators (permanent workers) used to do the work of cleaning and repairs on their own, but now they refuse to do the same, under the plea of extra effort needed to be put in for increased productivity. Sometimes such jobs involve difficult or extremely unhealthy conditions and grave danger. In order to avoid confrontation with such organised permanent workers, the management, instead of improving the working conditions, resort to engagement of insecure contract labour.

One can understand employers’ interest in creating a rif t between the permanent and contract workers or discouraging unionisation of the latter; but it is difficult to understand the reluctance on the part of trade unions to enrol the contract workers in their fold and make a common cause with them.

Under the new economic policy of liberalisation, the employers’ lobby always insists on reduction of costs of their production and services, because they have to sustain themselves in internal/external competition. An employer of a paper manufacturing factory located on the border of Maharashtra and Andhra Pradesh, has been engaging contract labour in the regular production process. He says that if the contract labour system is abolished in Maharashtra and they are made permanent, his costs will increase and then he will not be able to compete with his competitors having their factories across the border, in A.P. Many industries even threaten the respective State Governments to close down their operations if the Act is enforced diligently and go to neighbouring States. Under such circumstances, many State Governments are reluctant to strictly implement the Act.

ii. Study Report by Tata Institute of Social Sciences and Navjeevan Samiti on ‘Wages and Work Conditions of Contractual Conservancy Workers’ (April, 2008):

Conducted in two phases. Phase � – Pimpri Chinchwad Municipal Corporation., Navi Mumbai Mun. Corp. (both Maharashtra); Hubli Dharwad Mun. Corp., Mysore Mun. Corp., Bangalore Mun. Corp., Tumkur, Mandya (all Karnataka); Chennai, Chandigarh, Surat, Udaipur AND Phase 2 – Workers in solid waste management, situation at a glance in 27 urban centres in Maharashtra. Their observations are reproduced in the following bullet points.

Conservancy work is statutory and perennial in nature; contract labour should not be employed for performing the same.

Conservancy work has been taken out of the purview of the Act, in Tamilnadu through an amendment.

Except in Chandigarh, the contract workers are nowhere paid minimum wages. They do not get a single day of leave with pay. In some cases, there is deduction in wages for provident fund, but the proof of the same is not given to them.


In all the urban centres, contract workers are engaged alongside the permanent workers in the same tasks, where the issue of ‘Equal Pay for Equal Work’ emerges as significant and needs to be addressed.

Working conditions are very difficult and compounded by the fact that work with waste is itself hazardous to heath and increases proneness to skin and respiratory infections. Contract workers are not provided any safety gear.

There are dif ferent patterns of employment. For instance, in one of the corporations, each worker has been treated as a contractor and has to sign an independent contract, evidently in order to circumvent the Act.

iii. Contract Labour Act in India – A Pragmatic View, (research paper) by Meenakshi Rajeev (Faculty, Institute of Social and Economic Change, Bengaluru): (2009)

A primary survey carried out in Karnataka, an industrially developed state, reveals that many of the stipulations made in the Act to safeguard contract labour are not followed in practice. It has been felt by the workers that collusive agreement between the Labour Inspector, the protector of law, and the principal employer and the contractor has aided the violation of law. Among different kinds of employment that have been created in various economies to circumvent labour laws, contract labour is becoming one of the prominent forms. It is revealed through survey that some of the companies maintain more than one register, one for the scrutiny of the labour inspector and other contains the actual figures.

Collection of data regarding contract labour is extremely dif ficult and managements of the firms were often secretive about the number of contract workers employed and the benefits provided to them.

Knowledge of high level of corruption in connection with violation of the Act has been reported by 90% of the agencies. It has been reported that government officers have been neglecting their duties towards compliance of the Act for extraneous reasons.

There are number of unregistered contract agencies that deduct P.F. contribution from the workers but never deposit the same in P.F. office and after few years change the location and start the same business with different name. There are obvious advantages of being unregistered to its owner as it enables agency to evade taxes, paying P.F., E.S.I. benefits etc. to a worker and thereby increase one’s profit margin.

It is the overtime payment through which contractors usually try to generate additional income for themselves by taking advantage of the vulnerability of contract employees. The contract workers interviewed were not very sure of the wage rate for the overtime work.


In Indian case, blame is on the fact that for a contract worker it is not only hard to prove his/her identity as worker under the relevant labour law, but employer- employee relationship is also not easy to establish.

iv. Contract Labour in South Asia, (book) by D.P.A. Naidu, International Labour Organisation (ILO) Geneva: (1999)

Employment of contract labour is a long established practice in virtually the entire public sector. Now it is becoming more extensive. Due to the ban on new recruitment by Government, large number of regular posts lie vacant and establishments are rather forced to engage contract labour. Low labour costs, flexibility in the size of labour force and ease of maintaining discipline and extracting work are strong incentives for them to engage contract labour.

In almost all units work done through contract labour includes essential and perennial jobs in the unit. Though law clearly prohibits it, the practice persists and even grows. In majority organizations proportion of contract labour is up to 40% of the work force.

In the name of introducing greater flexibility in the labour market, Government has for the past five years tilted in favour of non-regular modes of employment rather than job security for workers which earlier used to be public policy.

Industrial society has undergone a drastic change over the years in terms of technology, work organization, and human resources. These developments during recent past have posed serious challenge to trade unions. Trade unions are faced with threats of survival in the new economic environment. In this situation, non-governmental and unorganized sector including industries and services engaging large proportion of contract labour need to be focussed upon and their needs to be identified. Where contract labour are unionised, they have been able to make significant gains in respect of prohibiting the contract labour system on essential and perennial jobs, improving wages and securing fringe benefits and a modicum of job security. The gap between wages of contract employees and regular employees is also narrowed to some extent.

v. Contract Labour and Judicial Interventions, (book) by Sanjay Upadhyaya, V.V. Giri National Labour Institute, New Delhi. (2009)

Process of globalization, liberalization has resulted in the increase in the trend towards substitution of regular employment by contract employment and this trend is going to continue and grow in future.

One of the major factors responsible for preferring contract labour against the regular employees is the temptation to lower overall wage cost for similar quality and quantity of work.

2�Including the Excluded

Poor conditions of work; excessively long hours and very low wages as compared to workers with permanent status doing similar work. Many of the benefits, even the statutory ones, like provident fund, sickness insurance, gratuity, and privilege leave with pay and so on are usually not available to contract workers.

Indian state has made different enactments for labour at different points of time to cover various categories of workers including contract labour. However the limitations and constraints of most of these enactments are that majority of these enactments put one kind of ceiling or the other either in terms of number of workers engaged or wages or duration of employment for the purpose of coverage under these enactments. As a result large section of vulnerable group of workers including those working as contract labour is left out of the legislative coverage and protection. Another limitation of these legislative measures is that the various kinds of penalties provided under most of these enactments are quite meagre in nature and the procedures prescribed under most of these enactments for realising various kinds of dues and benefits are quite cumbersome which defeats the very purpose of making elaborate legislative provisions.

vi. Contract Labour in India, (book) by Dr. D.C. Mathur: (1989)

It is opined that the factors like uncertainly of work-orders, difficulty in ensuring closer supervision by employer, higher output by workers cost effectiveness, flexibility in manpower deployment, concentration in core competencies etc/., justify the system of contract labour.

In the name of employment through contractors many employers have tried to evade their responsibilities towards a section of labour which is connected with the manufacturing process and resultant overall development of the industry as well as of the country but the contract worker is an exploited section of Indian working class.

vii. Indian Industry Dependent on a Forgotten Workforce by Dibyendu Maiti, Institute of Economic Growth, New Delhi: (20/07/2009)

In India we observe an increasing use of casual, contract or other such non-regular labour over a time-period. In India’s manufacturing sector surprisingly high levels of contract workers are being used, in some cases, as many as three times the regular workers. The official estimate however, states that, some of India’s key industries such as cement, iron and steel, cotton textile and jute, rely on contract labour. As many as four out of every five workers are contract workers. The official record of industrial statistics puts the share of


contract labour in organised manufacturing sector at �5% to 26% across West Bengal and Gujarat states; but research found the share to be much higher, up to 60% to 70% across these states.

But, India’s economic success is not improving the lives of contract and informal workers who form the largest section of the economy and make a major contribution to the country’s global success.

viii. No End in Sight to Contract Labour Debate, by Maitreyee Handique (Mon. 3, August 2009; livemint.com/Articles):

At Indian labour conference, employers pointed out that in order to remain competitive firms must be allowed greater flexibility to outsource workers. Employers also said that in changing environment of business a separation of core and non-core activities in not possible and pointed out that China’s contract law does not make such distinction.

In Bharat Aluminium Co. Ltd. (a public sector unit), contract labour has increased from �500 to �5000 and regular employment decreased from 7000 to 5400. However, the wages of contract labour were Rs. 3000/- to Rs. 5000/- p.m. and regular workers Rs. �2000/- to Rs. �9000/- p.m. Contract workers are also often deprived of benefits such as medical facilities.

ix. Impact of Liberalisation on Employment in India, by R.K. Shastry, Ravindra Tripathi and Anushree Singh (International Journal of Technical and Vocational Education, Vol. 2(3) pp33-35: (July 2010)

In Urban India, contract and sub-contract as well as migratory agricultural labours make up the most of the unorganised labour force 90% of this labour force do not have social security and other benefits of employment as in the organized sector.

Harmonisation of labour welfare with the privatisation process is really desirable in the present scheme of things, so as to strike the right balance between economic exigencies and social justice.


Chapter III

Case Law and the Role of Judiciary

Statement of Object and Reasons of the Contract Labour (R&A) Act 1970.“The system of employment of contract labour lends itself to various abuses, The question of its abolition has been under the consideration of Government for a long time. In the Second Five Year Plan, the Planning Commission made certain recommendations, namely, undertaking of studies to ascertain progressive abolition of system and improvement of service conditions of contract labour where the abolition was not possible. The matter was discussed at various meetings of Tripartite Committees at which the State Government were also represented and the general consensus of opinion was that the system should be abolished wherever possible or practicable and that in cases where this system could not be abolished altogether, the working conditions of contract labour should be regulated so as to ensure payment of wages and provision of essential amenities.

The bill aims at abolition of contract labour in respect of such categories as may be notified by appropriate Government in the light of certain criteria that have been laid down, and at regulating the service conditions of contract labour where abolition is not possible. The Bill provides for the setting up of Advisory Boards of a tripartite character, representing various interests, to advise Central and State Governments in administering the legislation and registration of establishments and contractors. Under the Scheme of the Bill, the provision and maintenance of certain basic welfare amenities for contract labour, like drinking water and first- aid facilities, and in certain cases rest room and canteens, have been made obligatory. Provisions have been made to guard against delays in the matter of wage payment.”

Preamble: An act to regulate the employment of contract labour in certain establishments and to provide for its abolition in certain circumstances and for matter connected therewith.

Though the preamble of the Act speaks of abolition in certain cases, the whole of the Act is silent about any reference to abolition, but talks of prohibition of contract labour in certain cases on issuance of notification under S. �0 of the Act. The legal pundits infer that following the principles of statutory interpretation, the act does not spell out any provision of abolition and absorption of workers but of regulation. This and such other interpretation makes the whole or major part of the Act redundant and nugatory in nature. Though the interpretative law says that the statement of object and reasons as well as the preamble of the Act are not binding while deciding the object of the Act which can be inferred from the actual provisions of the Act, it is suggested that


the Courts should also give importance to the history of legislation and the purpose for which the Act is enacted; if not done, the legislation will make the act redundant, useless and the utility of the rest of the provisions of the Act will be only restricted to implementation of the Act, which will be entirely in the hands of administrative machinery.

It is clear that the mischief sought to be corrected by the act was that the system of employment of contract labour lends itself to various abuses and hence working conditions of contract labour should be regulated so as to ensure payment of wages and provision of essential amenities, ultimately aiming at, ascertaining progressive abolition of system of contract labour.

If we apply the principles of mischief rule, purposive interpretation and interpretation of a beneficent piece of legislation are applied, the act should be interpreted in such a manner which will be beneficial to the weaker section which in the present case is contract labour.

Article. 38, 39, 40 and 43(a) Constitution of India, may be useful for interpretation of the provisions of the act in favour of contract labour.

For the sake of convenience we quote herein below some of the observations on the construction of Statue with reference to purpose and object of the Act, reproduced from the Book “Principles of Statutory interpretation’ �

“The duty of judicature is to act upon the true intention of the legislature – Mens or sententia legis” 2

“If a statutory provision is open to more than one interpretation the court has to choose that interpretation which represents the true intention of the legislature” 3

“Legislation in the modern state is actuated with some policy to curb some public evil or to effectuate some public benefits” 4

“The legislation is primarily directed to the problems before the legislature based on information derived from past and present experience. It may also be designed by use of general words to cover similar problems arising in future” 5

“The intention of the legislature thus assimilates two aspects; in one aspect it carries the concept of ‘meaning’ i.e. what the word means and in another aspect it conveys the concept of purpose and object or reason and spirit prevailing in the statute. The process of construction therefore combines both literal and purposive approach.”

�. by Justice G.P. Singh, (Former Chief Justice Madhya Pradesh High Court) (��th Edition 2008)2. J. P. Bansal vs. State of Rajasthan, (A.I.R. 2003 SC �405)3. Bhatia International vs. Bulk Trading S.A. (A.I.R. 2002 SC. �432)4. United Bank of India Calcutta vs. Abhijit Tea Company Pvt. Ltd. (A.I.R. 2000 SC. 29575. American Cynamid Co. vs. Upjohn Co. (�970 ) 3 All. E. R. pg 7856. Land acquisition officer and Mandal Revenue Officer vs. Narsaiah (A.I.R. 200� SC, pg. ��7)


“Court should adopt an object oriented approach keeping in mind the principal that legislative futility is to be ruled out so long as interpretative possibilities permit” 7

Foundation of the Act The judicial world woke up to the plight of such workmen in the case of Standard Vacuum Refinery Company Private Limited Versus Their Workmen Standard Vacuum Refinery Company Private Limited Versus Their Workmen

(1960 LLJ II 233, SC)‘It was concerned with an Award of the Industrial Tribunal, which considered the demand made by the Union for abolition of contract system of work, where the nature of work was of cleaning and maintenance of machinery. The award was in favour of workmen. The said award was challenged by the employer in special leave petition before the Apex Court wherein two issues were raised as to whether such dispute constitutes an Industrial Dispute under (Sec.2-K) of the Industrial Disputes Act and justifiability of the tribunal in interfering with the Managements right.

The Supreme Court observed that “there was a community of interest between the concerned workers and the workers of employer, who had a substantial interest in the contractors’ labour. In this Judgment, Supreme Court referred to the observation of the Royal Commission of the Labour and observed that the complex responsibility lay down upon it by law and by equity, that the manager should have full control over the selection, hours of work, and payment of workers”.

The Supreme Court observed the system to be primitive and baneful. A reference was also made to a discussion of Indian Labour Conference. The other issue regarding justifiability of the tribunal in interfering with the Managements right was also negated by the Supreme Court.

The Supreme Court observed “so far as this work is concerned it is incidental to the manufacturing process and is necessary for it and of a nature which must be done every day. Such work is generally done by workmen in the regular employee of the employer and there should be no difficulty in having regular workmen for this kind of work”.

Thus it is clear that the Supreme Court has simply upheld the order of the Industrial Court which directed the company to discontinue the practice of getting work done through contractor’s and to have it done through workmen engaged by itself. Surprisingly there was no justification given by the Industrial Court in holding that the workman of the contractor could not claim any relief in respect of their past services

7. Nathdevi vs. Radha Devi (2005, 2SCC pg. 27�)


rendered to the company. All that was said was that the company was free to give preference to the workmen engaged by the contractor.

Pursuant thereto a Bill was introduced in the Lok Sabha on 3�.7.�967 for regulation and abolition of employment of contact labour. The said bill aimed at abolition of contract labour in respect of such categories as may be notified by the appropriate government in the light of certain criteria that had to be laid down and at regulating the service conditions of contract labour where abolition is not possible. The Bill also provided for various other things such as establishment of Central and State Advisory boards, on the basis of whose report, the appropriate government may take a decision of abolition or regulation of contract labour. The Bill provided for coverage of establishments, employing 20 or more persons. It provided for registration of the principal employer and license for the contractor and also for certain welfare measures.

Since then there have been a cartload of Judgements which have reiterated the need of abolishing contract labour but has however not granted any practical relief to the contract workers. As such, despite the passing of 40 years, after the implementation of the act the plight of the workers continues to be the same. While analysing the case law, we have referred only to the Supreme Court judgements and not High Court judgements, though the latter have also dealt with the issue appropriately, as the finality rests with the Hon’ble Supreme Court. We also make it clear that in this analysis, we have not intended to show any disrespect to it nor is there an intention to criticise its hon’ble judges or the judiciary in general. This exercise is intended to find out the reasons for ineffectiveness of the Act in doing justice to the subject viz. Contract labour.

Analysis of the Supreme Court Judgements: Post Enactment of the Law: Supreme Court Judgments on the provisions of the Act especially with reference to Section 10 (2) of the Act:

1) Vegoils Pvt. Ltd. vs. Its workmen, 1971 II LLJ 567. AIR Supreme Court �972, pg. �942

In this case a reference was made under Section 10 of the I.D. Act for adjudication to decide whether contract labour system should be abolished and whether the workmen engaged by the contractor should be treated as principal employer’s regular employees. The Industrial Tribunal, Maharashtra delivered an award directing the employer, not to engage any labour through a contractor. The claim for abolition was rejected by the Tribunal in respect of Canteen Section and directed not to engage contract labour for work of loading and unloading.

The Hon’ble Supreme Court held that “the abolition of contract labour in respect of feeding the hoppers, for the requirements of the solvent extraction plant, is quite correct in accordance with the various decisions.


The issue whether the Act, which is the Central legislation or the State legislation viz. Maharashtra Mathadi, Hamal and Other Manual Workers (Regulation of Employment and Welfare) Act would prevail and also the one about the jurisdiction of the Tribunal for its direction not to engage contract labour, was set aside.

Under Section �0 of the Act, the jurisdiction to decide matters connected with prohibition of contract labour is now vested in Appropriate Government.

On facts of the case, the Supreme Court directed the enquiry about the regularisation. At that time the Act had received assent on 05/09/�970, which eventually came into force from �0/02/�97� and the Mathadi Act was in force from �3/06/�969 at the time of passing award, by the Industrial Tribunal. The said award by thus set aside by the Apex Court, in view of the later day development of the Act coming into being (paragraph 44).

2) Denanath vs. National Fertilizers (1992 1 CLR 1, 1992 LIC 75, 1992 I LLJ 289)

This is a case of non-compliance of section 7 and section �2 by the principal employer and contractor and the issue involved was whether due to non- compliance, the employees of the contractor are deemed to be the employees of the principal employer.

Paragraph 22 of the Judgment states “it is not for the High Court to enquire into the question and decide whether the employment of the contract labour in any process, operation or any other work should be abolished or not. It is entirely in the hands of the Government. Therefore under Article 226 of the Constitution the Court cannot issue a writ of mandamus or any writ for deeming the contract as having become the employees of the principal employer.”

In view of the difference of opinion of the various High Courts, after consideration of those judgments, the Supreme Court upheld the view that Non Compliance of Section 7 of the Act would result only in prosecution.

3) Gujarat Electricity Board vs. Hind Mazdoor Sabha and others 1995 1 CLR 967. In spite of there being an agreement between the company and the contract labourers’ union as regards the service conditions of the members of the latter under section 2P read with section �8 of the ID Act and award being declared the Supreme Court considered to give importance to the point of jurisdiction and held that the issue of jurisdiction of court under ID Act is ousted and a reading section �0 of the Act, it is only the appropriate Government to decide whether the system of contract labour should be abolished.


The Apex Court for the first time however, observed that the Act was silent on the question of status of the workmen of the erstwhile contractor once the contract is abolished by the appropriate government. It also expressed its dismay over the fact that even the public sector undertakings were indulging in unfair labour contracts by engaging contract labour when the workmen can be employed directly. It further observed that economic growth is not to be in terms of production and profits alone but to be gauged primarily in terms of employment and earnings of the people.

4) Air India Statutory Corporation vs. United Labour Union 1997 I CLR 292, 1997 I LLJ 113, 1997 (1) LLN 75, 1997 LLR 305It is held that the notification dated 9/�2/�976 prohibiting employment of contract labour was valid in law.

Here, the Supreme Court provided clear and specific relief, holding that on abolition of contract labour system, by necessary implication, the principal employer is under statutory obligation to absorb the contract labour. The linkage between the contractor and the employer stood snapped and direct relationship stood restored between principal employer and the contract labour as its employees.

The Supreme Court further upheld that the High Court under Article 226 of the Constitution can direct the principal employer to absorb the contract labour after its abolition.

There are instances where statutes provide for some welfare measures such as canteen, etc. Section 46 of the Factories Act, provides that in case where the factory engages �00 or more workers, the principal employer must make a provision for canteen. Provisions of Section 46 of the Factories Act came to be considered in various judgments and ultimately it was held that though the factories Act provides for a canteen in the factory engaging more than �00 workers it cannot be said to be a regular activity of the principal employer. The employer therefore can give contract of the canteen to the contractor and make a provision of canteen as provided for under section 46 of the Factories Act. There are cases where contractor continues to be same for years together but workers are changed or where the workers continued to be same for years together but the contractors are changed and the third case is that the contractor and workers continued to be same for years together. The issue whether the activity is of perennial nature came to be considered for various courts and it was held that since it’s a statutory liability therefore the nature of work is perennial. As regards the status of workmen of contractor it is held that the workmen of the contractor do not automatically become direct employees of the principal employer even where the registration/licence is cancelled or the contract is abolished.

5) In Steel Authority of India Ltd. vs. National Union Waterfront Workers, 2001 III CLR 349, 2001 II LLJ 1087


Though the main issue for consideration was whether for Steel Authority of India, whether the Appropriate Government is the State or the Central Government and even though the issue of interpretation of section 10 of the Act was not there, the Supreme Court while holding that for Steel Authority Of India the Appropriate Government was the State Government went ahead and thought of deciding the issue of section 10 of the Act.

In this case though the issue in respect of contract labour did not directly arise, as there was no specific prayer, the Hon’ble Supreme Court took a stock of various judgments on the Act, and in paragraphgraph l04 and 105 considered the previous decisions. The Supreme Court summarised the decision in various cases in the said paragraphgraphs. In paragraph 122 of the said Judgment the Supreme Court dealt with the powers of the appropriate Government u/s 10 of the Act. By this paragraphgraph the Supreme Court overruled the judgment in Air India’s case prospectively holding that there cannot be absorption of the workmen of the contractor even if the contract is abolished or it is held to be sham and/or bogus.

Though the said issue was incidental one, the Supreme Court went on to decide it as a main issue.

The net result of the above mentioned judgement is that the door which was open for the workers to ventilate their grievance before the adjudicating authority is closed but the same is available only in the cases of sham, bogus contract or a contract which was not genuine. The issue of contract being bogus, sham or not genuine mainly depends upon facts, the knowledge of which is with the employer and the contractor and therefore, in fact, the door for adjudication was completely closed. Indirectly it also resulted in denial of opportunity to the workers to ventilate their grievances as the power of deciding the issue is exclusively in the hands of the Government whose order is an administrative order and the issue is not decided there by any judicial or quasi-judicial process.

6) Cipla Ltd. Vs. Maharashtra General Kamgar Union and others (200� CLR I 754, SC)

The case put forth by the workers was that they had been directly employed by the company and the contract was a camouflage. Their union considered the said matter as one of unfair labour practice (ULP) by the company and approached the Court under the concerned law viz. Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act. When the matter reached the Supreme Court, it observed that for any practice to be considered as an ULP, there had be a clear employer-employee relationship between the parties to the case. Since such a relationship didn’t exist between the appellant and the respondents, the Court under MRTU and PULP Act can’t adjudicate the said case.


Thus, although the company had truly been committing an unfair practice, (though not defined so under the concerned law as an ULP), the Apex Court dismissed the case by taking a very technical view as regards the employer-employee relationship, which was actually the bone of contention.

7) Vividh Kamgar Sabha vs. Kalyani Steels Ltd. and Anr. (2001 I CLR 532, SC)The context of this case was exactly the same, only the parties to the case being different. The Supreme Court held exactly the same view as, “The provisions of MRTU and PULP Act can only be enforced by persons who admittedly are workmen. If there is a dispute whether the employees are employees of the company, then that dispute must first be got resolved by raising a dispute before the appropriate forum. It is only after the status as a workman is established at the said forum, that a complaint could be made under the provisions of MRTU and PULP Act”.

After considering these judgments, one can see that instead of providing solutions, these judgments have multiplied the problems of the contract labours.

Prior to the enactment of the Act, the remedy of adjudication was available to the aggrieved workers. Considering the history prior to the said enactment, the intention was to give powers to the Government to abolish the contract labour, wherever the nature of work was found to be permanent or incidental thereto. Due to the interpretations of the highest Court of the land, the available remedy at times is taken away and the fate of the aggrieved workers is placed entirely in the hands of the Government. The interpretative process may be within four corners of the law, but the results do not afford any substantive relief to the contract labours. The Act has not provided for any separate adjudicating machinery to resolve the grievances of the aggrieved workers resulting into denial of fundamental rights of the workers to ventilate their grievances before the adjudicating authority.

The advisory board can only recommend and final decision remains in the hands of the appropriate Government, which is only on the basis of the material collected by the Government machinery.

Comparing this Act with other statutes, viz. I.D. Act, BIR Act, MRTU and PULP Act, it does not provide for any judicial or quasi-judicial forum for determination of disputes. This has resulted either in perpetuation or prolongation of the issue of the contract labour and their employment.

Today we are placed in a situation that grievance of contract labour continues to exist in spite of perennial nature of work and there is no machinery for redressing these grievances. Unfortunately therefore, we come to the conclusion that this act has not served the object and purpose for which it was enacted.


A ray of hope is created by the recent Supreme Court judgment reported by an observations in paragraph 23 in the judgement of the Hon’ble Supreme Court in the case of Harjinder Singh versus Punjab State Warehousing Corporation, reported in Manu /SC/0060/2010, without any further comment

Quote: - Of late, there has been a visible shift in the court’s approach in dealing with the cases involving the interpretation of social welfare legislations. The attractive mantras of globalization and liberalization are fast becoming the Raison D’ etre of judicial process and an impression has been created that the constitutional courts are no longer sympathetic towards the plight of industrial and unorganized workers”.

Quote:- “The courts have readily accepted such plea unmindful of the accountability of the wrong doer and indirectly punished the tiny beneficiary of the wrong ignoring the fact that he may have continued in the employment for years together and that micro wages earned by him may be the only source of his livelihood. It needs no emphasis that if a man is deprived of his livelihood, he is deprived of all his fundamental and constitutional rights and for him the goal of social and economic justice equality of status and of opportunity the freedom enshrined in the constitution remained illusory. Therefore the approach of the courts must be compatible with the constitutional philosophy of which the directive principles of state policy constitute an integral part of justice due to the workmen should not be denied by entertaining the spacious and untenable grounds put forward by the employer/ public or private”.

Similarly, in the past too, there were a few such Court verdicts, though more as exception, but nevertheless provided the much needed ray of hope. They are as follows:

National Federation of Railway Porters, Vendors and bearers vs. Union of India (1995 II CLR 214, SC)In this case the Supreme Court granted regularisation to the railway parcel porters, provided by societies or private contractors as contract labour, at the backdrop of those porters having worked so continuously for a number of years and also that the work of parcel-handling was perennial in nature.

Indian Airports Employees’ Union vs. International Airports Authority of India (1996(1) Mah. LJ, SC)The Central Government had issued a notification dated 09/�2/�976, prohibiting engagement of contract labour in sweeping, cleaning, dusting work with effect from 0�/03/77 in respect of establishments for which the appropriate Government was the Central Government The respondent company fitted squarely under the purview of the said notification. Despite the same, it continued its practice of engaging contract labour in the said work. The supreme Court in this case, provided the expected relief of absorption of the concerned contract labour.


Secretary, Haryana State Electricity Board vs. Suresh and Ors. etc. etc. (1999 I CLR 959, SC)Safai karmacharis were engaged as contract labour for cleaning/sweeping work. After their services were terminated, they claimed permanency. The Supreme Court in this case called the said contract system a mere camouflage, smokescreen and disguised in a veil, which could easily be pierced and the real relationship between the Board on one hand and the employees on the other hand, could clearly be visualised. The facts of the case that supported the said conclusion of the Court was notably the absence of due registration of the Board as well as that of a licence, as required under the Act, in the hands of the person who posed as contractor.

Hindalco Industries Ltd. Vs. Association of Engineering Workers (2008 I CLR 1023, SC)Here, the contract labour working in the canteen of the company had continued working so despite a change in the contractor in the meantime. Secondly, evidence on record established the ultimate control of the company management on the said workers. The respondent union had approached the Industrial Court by filing a case of ULP under the Industrial Disputes Act, who in view of the facts and circumstances of the case, that the canteen contract was merely a paper agreement. In the appeal, the High Court had endorsed the view of the Industrial Court. In the subsequent appeal, the Supreme Court also upheld the same.

Sarva Shramik Sangh vs. Indian Oil Corporation Ltd. and Ors. (AIR 2009 2355, SC)Here, relief was sought under the Act, for abolition of contract labour system in the canteen of the marketing establishment of the principal employer. The State Government examined the merits of the dispute and refused to make reference on the ground that the workers were not the employees of the company, where the very dispute that required reference was whether the workers should be considered as the employees of the company. In this case, the Supreme Court directed the Central Government to reconsider the matter and take an appropriate decision on the request for reference of the dispute to the industrial adjudicator (paragraphs�3, �5).

Bhilwara Dugdh Utpadak Sahakari Sangh Ltd. V. Vinod Kumar Sharma Dead by LRS and Ors. (SC, Sept., 2011)The Labour Court had held that the workmen were the employees of the appellant and not the employees of the contractor. The High Court too had upheld the said position. In the appeal to the Supreme Court, it not only upheld the said finding but also observed, “This appeal reveals the unfortunate state of affairs prevailing in the


field of labour relations in our country. In order to avoid their liabilities under various labour statutes, employers are very often resorting to subterfuge, by trying to show that their employees are in fact the employees of their contractors. It’s high time that such subterfuge must come to an end. Globalisation / liberalisation in the name of growth, can not be at the cost of exploitation of workers”.

Ironically, every judgment stated above has very broadly reiterated the principles and foundations on which the Act was based, that are to prevent the exploitation of contract labour and also to introduce better conditions of work.

We feel that the Hon’ble Supreme Court did not give due importance to the object of providing for job security for such of those employees who have been engaged as contract labour and bring them at par with the permanent employees. Except for a few Judgements passed by the very same Supreme Court that have boldly pointed out that there is a gross lacuna in the Act itself which required a very strong amendment, none of the Judgements have in fact, set out any path nor shown the way to help these contract employees.


Chapter IV

Data AnalysisField research was carried out as mentioned earlier. Relevant data was gathered during the same, the analysis of which has been presented with the help of the following tables.

Table No. 1

Type of Contact Pune % Nasik % Thane %A.

bad% Mumbai % Total %

Contract Labour �20 2� 60 �0.5 200 35 40 7.0� �5� 26.4 57� �00

Contractor 8 33.3 3 �2.5 4 �6.7 2 8.33 7 29.2 24 �00

Trade Union Official

6 25 4 �6.7 5 20.8 3 �2.5 6 25 24 �00

Government Officials

4 22.2 3 �6.7 0 0 3 �6.7 8 44.4 �8 �00

Employers 8 23.5 3 8.82 5 �4.7 2 5.88 �6 47.� 34 �00

Legal Advisors/Labour

Consultants�0 4�.7 2 8.33 5 20.8 2 8.33 5 20.8 24 �00

Employers Association

� 25 2 50 0 0 0 0 � 25 4 �00

Coverage of the Pilot Study.

The detailed observations pertaining to the field survey that covered people ranging from contract labour to the representatives of trade unions as well as employers and also independent professionals, have been narrated.

2.1 Survey of the contract workers:

2.1.1. The Number of the contract workers Selected for the Survey, according to the Categories of the Industries:

During this study total 57� contract workers were interviewed . Among them 200 labourers i.e. about 35%, were from Thane Belapur Industrial area, while 26% are from Mumbai, industrial area, where as 2�% from Pune industrial area and remaining �00 (�8%) are from Nashik and Aurangabad industrial areas.

While selecting the contract workers for the survey, all the three categories of industries viz. the large, medium and small scale inclusive of Government and semi Government establishments were taken into consideration.


Break up of these labourers selected for the survey is as under:

Table No. 2 Break-up According to Type of Units

Type of Contact Pune % Nashik % Thane % A. bad % Mumbai % Total %

Small Scale �2 30. 4 26.7 30 32.3 5 3�.3 8 20.0 59 28.9

Medium Scale 8 20. 3 20.0 34 36.6 6 37.5 �� 27.5 62 30.4

Large Scale �4 35. 8 53.3 29 3�.2 5 3�.3 8 20.0 64 3�.4

Gov. and Semi Government

2 5. 0 0.0 0 0.0 0 0.0 5 �2.5 7 3.4

Service Sector 4 �0. 0 0.0 0 0.0 0 0.0 8 20.0 �2 5.9

Total 40 �00 �5 �00 93 �00 �6 �00 40 �00 204 �00

Thus this pilot study has surveyed 57� contract workers from 204 units of different types of industries.

Break-up of the units according to type of management is shown in the table below.

Table No. 3 Break-up of Units According to Types of Management or Ownership

Type of Contact

Pune % Nashik % Thane % A. bad % Mumbai % Total %

Government � 2.5 � 6.7 0 0.0 0 0.0 � 2.5 3 �.5

Semi-Government

2 5.0 0 0.0 0 0.0 0 0.0 4 �0.0 6 2.9

Private 37 92.5 �4 93.3 93 �00.0 �6 �00.0 32 80.0 �92 94.�

Others 0 0.0 0 0.0 0 0.0 0 0.0 3 7.5 3 �.5

Total 40 �00 �5 �00 93 �00 �6 �00 40 �00 204 �00

It will be evident from the above data that 94 % of the units were from the private sector. As explained in the methodology, stress in this pilot study was laid mainly on the contract workers from the industrial sector. Efforts were also made to contact the semi-government agencies like, MMRDA, MSEDL and Municipal Corporations etc., where there is a higher proportion of work being carried out through contract workers, for this study. Comparatively, it was easier to contact the contractors or their labourers and collect the data for this survey from Government and Semi- Government establishments than from Private agencies. Before contacting these units, the lists of industries from the office of the Chamber of Commerce and Industries or from the Industrial Directories were obtained for collection of the information. However, actual selection of the units was made on the basis of availability of the concerned persons in these units.


Personal Information of the contract workers Selected for the Survey:The detailed information of the contract workers selected for the survey viz. their age group, level of education, marital status and family background. has been collected during this survey for understanding their background. The information collected in respect of each of these aspects is presented in the following paragraphgraphs:

1. Age Group:Out of 57� contract workers surveyed, more than half i.e. 5�.8% were found to be in the age group of 26 to 35 years, while 26% were of the age less than 25 years of age. In short, more than three fourth of them belong to a young age group. The youth have greater physical strength and therefore those establishments gave preference for employing this category of the workers. Their proportion is higher in small and medium scale establishments as shown in the the following Table

Table No. 4 Age Wise Distribution of contract workers.

Age Group

Pune % Nashik % Thane %A.


�8 - 25 42 35 2� 35 30 �5 2� 52.5 35 23.2 �49 26.�

26 - 35 54 45 32 53.3 ��5 57.5 �3 32.5 82 54.3 296 5�.8

36 - 50 �4 ��.7 7 ��.7 53 26.5 6 �5 3� 20.5 �� 9.4

5� - 60 �0 8.3 0 0 2 � 0 0 3 2 �5 2.6

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00


2. Educational Level:There were only four illiterate contract workers among those surveyed. About 25% of them had however, completed only Primary Level education i.e. up to 7th standard, while 44% contract workers had studied up to �0th standard. Thus about 70% have however completed only mid-level education i.e. up to �0th standard. Percentage of the contract workers who have studied up to �2th standard works out to 23%. A few of them were observed to have been trained in technical subjects/crafts in the Industrial Training Institutes (ITIs). They appeared to be more interested in securing jobs for their livelihoods rather than those matching their education and training.

Table No. 5 Educational Level of Contract Workers

Education Pune % Nashik % Thane %A.


Illiterate 0 0 0 0 0 0 0 0 4 2.6 4 0.7

Primary (Up to 7th) 26 2�.7 � �.67 70 35 �3 32.5 34 22.5 �44 25.2

Up to �0th 69 57.5 33 55 80 40 �4 35 56 37.� 252 44.�

Up to �2th 20 �6.7 �8 30 40 20 �0 25 42 27.8 �30 22.8

Under Graduate 0 0 0 0 0 0 0 0 3 2 3 0.5

Graduate 5 4.2 0 0 5 2.5 3 7.5 7 4.6 20 3.5

ITI Trained 0 0 7 ��.7 5 2.5 0 0 5 3.3 �7 3

Engineering Diploma

0 0 � �.7 0 0 0 0 0 0 � 0.2

Engineering Graduate

0 0 0 0 0 0 0 0 0 0 0 0

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00


3. Marital Status:As per the survey it was found that about 76.2% of the workers were married.

4. Number of Dependents:Average number of dependents on 58.7% of those contract workers was found to be 4 to 6, while that in case of 24% of them was 3, which indicates the significant number dependents on the contract workers. The Chart below gives the relevant details.

Table No. 6 Number of Dependents

No. of Dependents



Nil 0 0 2 3.3 0 0 0 0 20 �3.2 22 3.9

One 0 0 2 3.3 0 0 0 0 �7 ��.3 �9 3.3

Two 4 3.3 8 �3.3 �2 6 2 5 23 �5.2 49 8.6

Three �2 �0 26 43.3 50 25 �� 27.5 38 25.2 �37 24

4 to 6 �04 86.7 22 36.7 �38 69 24 60 47 3�.� 335 58.7

7 and Above 0 0 0 0 0 0 3 7.5 6 4 9 �.6

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00


Ownership of ResidencesThe data in respect of the ownership of the residences indicates their economic status. It is revealed from the survey that 45% of them have their own houses. The rest of them are staying in the rented accommodations. It is also observed that out of the contract workers surveyed, the number of those commuting daily from their residences to the places of work, in the industrial estates is significant. Generally it is seen that, in the areas surrounding the industrial estates, chawl type structures are built on a large scale which enables the workers to hire the accommodations in these chawls. It is also observed that in some cases labour contractors do provide accommodations to the workmen at their own cost. However barring a few cases, more often than not; this provision of accommodation benefits the contractor more as he thereby ensures that the labourers are available to him beyond the legally permissible hours. Besides thereby these labourers are kept under obligations.

Further it is seen that most of the workers who migrate for the employment, do so singly. Rest of their family members stay back at their original places. It therefore becomes possible to provide accommodations to these individual labourers easily.

Table No. 7 Ownership Pattern of Residence

Ownership Pune % Nashik % Thane %A.


Own 65 54.2 25 4�.7 94 47 �8 45 54 35.8 256 44.8

Rented 55 45.8 35 58.3 �06 53 22 55 97 64.2 3�5 55.2

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00

5. Places of Origin:It is noted that out of 57� contract workers surveyed, about 46% of them have migrated from their native place to the places of work. This factor is very important. Since there are no means of earning livelihoods at their places of origin, they have migrated in search of jobs after studying up to �0th or �2th standards out of sheer necessity and not by their own choice, as stated by these labourers surveyed.

The above personal information of the contract labour has been collected by adopting methodology of direct interviews. Some of the workers were required to be interviewed at their residences. This provided an opportunity for us for observing the living conditions of these labourers. The conditions of the workers staying in the MIDC areas are found to be worse. The contract workers staying at Kurkumbh (Baramati), Waluj – Pandharpur (Aurangabad), Rajangaon (Pune) and Satpur (Nashik) are places where these contract workers have migrated solely for the purpose of earning livelihood and sending money back home for helping their family members. Their only aim in their


life is to keep soul and body together, at whatever cost by forgoing other pleasures of life. The conditions of the local contract workers are not much different from those of the migrated workers. Only qualitative differences between the two are that the local workers are able to stay with their families. Because of the compulsion of earning the livelihood, they had to forgo their education, especially the technical education, which would have enabled them to earn better remunerations.

Table No. 8 Number of Migrants.

.

Migration Pune % Nashik % Thane %A.


Yes 54 45 27 45 �00 50 �6 40 64 42.4 26� 45.7

No 66 55 33 55 �00 50 24 60 87 57.6 3�0 54.3

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00

2.1.3 About the nature of Contract Work:

During this survey, the labourers were asked to state as to how long they were carrying out that type of work, in how many companies they had worked so far, with how many contractors they had worked and what type of work they had carried out.

i) Periods of Work: The following table shows the period of their work as contract workers

Table No. 9 Periods of Work

Period of Work Pune % Nashik % Thane %A.


Up to One Year 0 0 � �.7 �0 5 8 20 8 5.3 27 4.73

� - 3 Years 32 26.7 2� 35 40 20 �3 32.5 3� 20.5 �37 24

3.� - 5 Years 48 40 �6 26.7 ��0 55 �8 45 75 49.7 267 46.8

5.� - �0 Years 30 25 �6 26.7 30 �5 � 2.5 29 �9.2 �06 �8.6

More than �0 Years �0 8.3 6 �0 �0 5 0 0 8 5.3 34 5.95

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00

out of 57� contract workers surveyed nearly 46.8% are engaged in contract work for last 3 to 5 years. This percentage is slightly higher in Mumbai and Thane Belapur industrial area. About 25% of these workers have been working as such, for more than 5 years, a few of whom are working for only last � to 3 years.


Due to their working conditions they cannot enjoy any facilities which the regular workers are entitled to. These workers continue with the fond hope that one day they would be appointed as regular workers.

It was further found that quite a few workers, when asked about the number of places where they had worked in the past, revealed that they had worked in many establishments. About 34.6% of these contract workers were compelled to change their jobs three or more times, 33.8% have had to move from one establishment to another for two or more times while the remaining 3�.5% have done that only once.

While discussing this subject further with those contract workers, following information came forth:

a) In several cases was found that contract workers have continued working for more than five year with the sole hope that sooner or later they will be absorbed. It was also found that in some cases workers are offered training by the principle employers. It may be noted here that principle employers often preferred same set of workers without confirming or absorbing them. In many cases they have encouraged new contractors to take old contract workers and seek benefits of their continued service.

b) Another main reason for the frequent changes of workers from one establishment to another is the contractors themselves. Sometimes the contractor is changed owing to the employers’ wishes and sometimes being dissatisfied with the employer, the contractor himself move on to another organisation /establishment. Net result being that the workers are shunted from one place to another.

c) Another important factor is found to be that, service-breaks to contract workers are given every year, though the contract workers have worked for long periods, and this too only for the purpose of avoiding the legal liability that may be arising out of the uninterrupted service-tenure beyond a limit. After the said breaks, they are employed afresh. In all such cases these actions are taken in understanding and collaboration with the contractor.

d) Some of these contract workers change the companies on their own accord, because of the lure of more wages and assurance of continuity in employment.

ii) Changes of the Establishments:It is generally believed that the contract workers frequently change the companies or the establishments. During this survey, this aspect was enquired into and data about the number of companies/establishments where these contract workers have worked so far was collected. Findings of the same are shown in the table below.


Table 10 Distribution of contract workers according to Companies

Where They Have Worked

No. of Companies



One 29 24.2 30 50 88 44 �2 30 2� �3.9 �80 3�.3

Two 45 37.5 26 43.3 76 38 20 50 26 �7.2 �93 33.8

Three 43 35.84

6.67 36 �8 8 20 20 �3.2 �� 9.5

Four or More 3 2.5 0 0 0 0 0 0 34 55.6 87 �5.2

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00

It is however predominantly observed that most of those contract workers had worked in one or two companies and their percentage works out to 65 %. Rest of them (35 %) had worked in three or more companies/establishments, which appears to be a case restricted to Mumbai industrial zone as compared to other areas.

One can clearly conclude that in spite of the fact the nature of work carried out is of permanent character, the labour force employed continues to be temporary. This is done only with a view to deprived the contract workers from claiming the benefits of a permanent worker with the principle employer.

iii) Change of the Contractors:The proportion of the contract workers working with the same contractor is found out to be much less over a period of time. While nearly 69.5% of those surveyed have worked with the same contractors for periods less than 3 years, only 30% worked beyond that. The treatment given by the contractors, their indifference to the welfare of the labourers and the exploitation done by the contractors are the main reasons for reluctance on the part of the workers to work with the same contractor for longer periods.

Table No. 11 Number of Years Working with This Contractor

No. of Yrs. working with this

ContractorPune % Nashik % Thane %

A. bad

% Mumbai % Total %

Up to One Year 34 28.3 28 46.7 40 20 4 �0 7 4.64 ��3 �9.8

� to 3 Years 65 54.2 25 4�.7 80 40 �2 30 �02 67.5 284 49.7

3 to 5 Years �8 �5 5 8.33 60 30 �8 45 �0 6.62 �� 9.4

More than 5 Years 3 2.5 2 3.33 20 �0 6 �5 32 2�.2 63 ��

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00


IV) Nature of Contract Work:

The contract workers covered under the survey were of unskilled, semi-skilled and skilled nature. We didn’t have access to those contract workers who may be working in clerical/supervisory capacity, though it is a common knowledge that there is a growing trend, especially in service industry segment, to engage contract workers in the said capacity.

Out of 57� contract workers surveyed about 72% of them are found to be deployed in such core activities related to manufacturing/production. This is the case observed prominently in all 3 types of establishments viz. the small, medium and large. It is revealed from the discussions with these contract workers that, more than 70% of such activities/processes related to production are being done by those contract workers. From the survey it was found that in areas near Mumbai there was comparatively lesser number of workers who were performing perennial or incidental work of an establishment whereas in other places the percentage was more than 80 % Workers. This is because of the simple fact that the ratio of regular workers to contract workers in establishments outside Mumbai was around 30:70. When the labour officers of these establishments were asked about this situation, they flatly denied the same and stated that no contract labourer was working in any manufacturing process in their establishments. Despite this flat denial, it was seen during the visits to those factories that, the contract workers were actually working even on CNC machines and also working in shifts, similar to their permanent counterparts.

This clearly shows that there is a tendency on the part of the owners of these establishments/factories, to pay low wages and extract more work from these contract workers.

Table No. 12 Nature of Work

Nature of Work Pune % Nashik % Thane %A.


Supervisor 4 3.3 0 0 0 0 0 0 4 2.6 8 �.4

Clerical 0 0 0 0 0 0 0 0 9 6 9 �.6

Unskilled 45 37.5 �7 28.3 75 37.5 �3 32.5 30 �9.9 �80 3�.5

Semi-Skilled 4� 34.2 22 36.7 65 32.5 �2 30 65 43 205 35.9

Skilled 30 25 2� 35 60 30 �5 37.5 24 �5.9 �50 26.3

Security 0 0 0 0 0 0 0 0 9 6 9 �.6

Other 0 0 0 0 0 0 0 0 �0 6.6 �0 �.8

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00


Table No. 13 Engaged in Any Productive Work?

Are you doing any productive or main work



Yes �0� 84.2 53 88.3 �6� 80.5 36 90 62 4�.� 4�3 72.3

No �9 �5.8 7 ��.7 39 �9.5 4 �0 62 4�.� �3� 22.9

Don’t Know 0 0 0 0 0 0 0 0 27 �7.9 27 4.73

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00

v) Remunerations for the work:

In this survey, information about the wages earned by these contract workers during last 3 years was also collected. It is revealed that they earned between Rs. 3000/- to 5000/- per month on an average. In some cases it is found out that they were paid even less than the minimum wages for the labourers. The average monthly wages paid to these contract workers during last 3 years are as under:

Table No. 14 Average Wages

Year Average Monthly Wages Rs.

2007-08 3960

2008-09 4600

2009-�0 5530

This data of average monthly wages according to the types of establishments is as under:


Table No. 15 Wages According to Type of Unit.

Type of Establishments

2007-08Rs. p. m.

2008-09Rs. p. m.

2009-10Rs. P. m.

Small 4063 4059 4732

Medium 4604 5044 527�

Large 42�4 4263 4350

Government/Semi-Government 3654 3846 4�92

This data according to places of work is as under:

Table No. 16 Place Wise Wages.

Centre2007-08Rs. p. m

2008-09Rs. p. m

2009-10Rs. p. m

Pune 3958 402� 4787

Nashik 4458 4667 499�

Thane 3387 4750 5660

Aurangabad 4487 4637 4500

Mumbai 3847 4824 6444

All 3960 4600 5530

It will be seen from the above that there are no large scale differences in the wages earned by these contract workers . The wages of the contract workers in small scale factories/establishments are somewhat less than their counterparts in other establishments.


Table No. 17 Salary Received in Last 3 Years

YearSalary

AmountPune % Nashik % Thane % A. bad % Mumbai % Total %

2007To

2008

Less Than 3000

�5 4.2 �9 �0.6 40 6.67 8 6.67 60 �3.2 �42 8.3

300� – 5000

�00 27.8 25 �3.9 �55 25.8 23 �9.2 66 �4.6 369 2�.5

500� - �0000

5 �.4 �6 8.9 5 0.83 9 7.5 �6 3.5 5� 3

�0000 and

Above0 0 0 0 0 0 0 0 2 0.4 2 0.�

NR 0 0 0 0 0 0 0 0 7 �.5 7 0.4

2008To

2009

Less Than 3000

�0 2.8 �3 7.2 �2 2 4 3.33 2� 4.6 60 3.5

300� - 5000

�05 29.2 30 �6.7 �40 23.3 27 22.5 89 �9.6 39� 22.8

500� - �0000

5 �.4 �7 9.4 48 8 9 7.5 36 7.9 ��5 6.7

�0000 and

Above0 0 0 0 0 0 0 0 5 �.� 5 0.3

2009To

20�0

Less Than 3000

5 �.4 7 3.9 5 0.83 3 2.5 3 0.7 23 �.3

300� - 5000

88 24.4 33 �8.3 98 �6.3 30 25 5� ��.3 300 �7.5

500� - �0000

24 6.7 20 ��.� 97 �6.2 7 5.83 84 �8.5 232 �3.5

�0000 and

Above3 0.8 0 0 0 0 0 0 �3 2.9 �6 0.9

Total 360 100 180 100 600 100 120 100 453 100 1713 100


V (i) Other Observations in respect of Wages:It was seen that the payment of wages to the contract labour surveyed is done by the contractors invariably. No representative of the company is present at the time and place of payment, whereas as per the Rules under the Act, a representative of the Principal Employer must be present.

The payment was made mostly in cash. About 84% of the contract workers surveyed confirmed the same.

Payment for the overtime made by the contractor to the contract labour was not according to the rates applicable to the regular workers of the company.

The principle of equal pay for the equal work was not observed anywhere.

Annual increases in the wages at the year-ends are decided by the contractors arbitrarily. No criteria appeared to have been applied while determining these increases.

Barring a few large scale industries in most of the small and medium scale industries, the contract workers were not paid wages for the weekly holidays.

Majority of the labourers surveyed complained that they were not paid full wages for the work done by them.

They were not issued any pay-slips and as such they were unaware of the deductions made from their wages. It was also seen many a time that they were made to sign some papers on which some entries were made in pencil.

In many cases the contractors are found to be providing certain facilities like accommodation, food, uniforms to the contract workers, for which deductions are made from their wages. Some contractors were inclined to pay a part of wages in kind rather than in cash.

Basically, there was no record maintained in many cases and if anybody c omp la ine d , t he re wa s a t h rea t o f h i s be ing remove d f rom work . This results into a situation of having no protection of any law for such contract workers.


Facilities/Services Made Available to the Contract Labour at the Places of Work:The following table gives the details of the facilities or services made available to the contract labour at their places of work.

Table No. 18 Facilities (Only Positive Responses)

Facility Pune % Nashik % Thane %A.


Appointment Letter

0 0 0 0 0 0 0 0 �0 6.6 �0 �.8

I Card 86 7�.7 57 95 �98 99 38 95 86 57 465 8�.4

Salary Slip �0 8.3 0 0 0 0 0 0 27 �7.9 37 6.5

Pay Leave 0 0 2 3.3 �0 5 0 0 2� �3.9 33 5.8

PF 60 50 45 75 90 45 23 57.5 24 �5.9 242 42.4

ESI 25 20.8 23 38.3 �0 5 �8 45 42 27.8 ��8 20.7

Bonus 40 33.3 40 66.7 �55 77.5 �5 37.5 45 29.8 295 5�.7

Gratuity 0 0 0 0 0 0 0 0 7 4.6 7 �.2

Overtime 70 58.3 52 86.7 �78 89 33 82.5 62 4�.� 395 69.2

Weekly Off 0 0 �2 20 53 26.5 �2 30 64 42.4 �4� 24.7

Canteen 35 29.2 �6 26.7 56 28 24 60 24 �5.9 �55 27.�

Security Equipment

68 56.7 42 70 �25 62.5 35 87.5 9 6 279 48.9

Medical Facility 76 63.3 54 90 68 34 37 92.5 �8 ��.9 253 44.3

Other 0 0 0 0 � 0.5 � 2.5 2 �.3 4 0.7

Base �20 60 200 40 �5� 57�

The data presented above is analysed as under:

Services: The proportion of the services like letters of appointments, pay-slips gratuity and paid holidays/leaves in case of these contract workers is quite insignificant.

Identity Cards: Upon survey it was found that 8�% of these contract workers are issued identity cards. This is because these identity cards are used mainly as gate passes. The said identity cards however indicated only their names and the names of the contractors but not the other details like the names of the departments where they worked or their dates of joining etc.


Provident Fund: About 42% of the contract workers surveyed told that they were informed by their contractors that they were getting provident fund. But at the same time they complained that they had not been given the numbers of their PF accounts. Hence, they do not know whether their contributions towards the PF are credited in their accounts or otherwise.

Bonus and Overtime: It is observed that in quite a few cases employers were also giving bonuses as well as overtime. However considering the limitations of the sample size this fact cannot be generalised.

Canteen: Only about 27% of the surveyed contract workers accepted that they able to avail this facility of canteen, to the extent of using the place. But they did not get the facility of the subsidised rates of the food articles served in the canteen, which was available only to the permanent workers. They were only allowed to eat their own lunch in the canteens and get the food articles at normal unsubsidised prices, as stated by 25 % of them. At some places it was observed that the contract workers were not allowed to avail the facility of the canteen or even to enter the canteen.

Medical Facilities: Only 44% of the surveyed contract workers stated that the facilities of medical treatment and first aid were available in their establishments and that too only at the places of work.

In general, there was a huge disparity in the availability of the facilities for the regular permanent workers and the contract workers of these industrial establishments/ factories/ companies.


Awareness among the contract workers about the Act:When the contract workers surveyed were asked, whether they knew anything about this Act, it was found that there was complete ignorance on their part. This is really a worrying situation. Only 3 out of the 57� contract workers surveyed stated that they knew something about it.

Similarly, only 29 out of 57� were found to have been enrolled as members of a trade union. It is more interesting that out of 204 contracted units only �3 units were having a union for contract workers.

Of the 57� contract workers surveyed it appeared that just five of them have taken the trouble of registering a complaint with the concerned Labour Commissioner, against the injustice done to them.

It can be seen from the above information that, there are a number of drawbacks or deficiencies in the implementation of the Act, and the purpose behind making this enactment has been served only marginally. The pathetic conditions of the contract workers came to light during this survey. In general, the economic conditions being not good, so being the educational level, no means of livelihood being available at their places of origin and the number of dependents on them also being large, they had no option but to migrate to cities and industrial areas in search of employment of whatever type available. Because of their extreme helplessness they were compelled to accept the jobs on contract basis for the sake of earning some income. The contractors as well as the employers take advantage of their helplessness. In these circumstances the Act would have proved to be helpful to them, provided it was implemented effectively by the concerned authorities. Presently its implementation is totally inept, as such they are deprived of the desired protection of this Act.


Table No. 19 Awareness about the Act

Aware about contract and contractor



License under sec. �2 of CLRA �970

2 2 0 0 0 0 0 0 54 54 56 �00

Terms and Conditions of Contract

2 2 0 0 0 0 0 0 �4 �4 32 �00

Do you know about CLRA 1970



Yes 2 �.67 0 0 0 0 0 0 � 0.66 3 0.53

No ��8 98.3 60 �00 200 �00 40 �00 �50 99.3 568 99.5

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00

No. of Workers made a compliant to labour

commissionerPune % Nashik % Thane %

A. bad

% Mumbai % Total %

Yes 0 0 � �.67 0 0 0 0 4 2.65 5 0.88

No �20 �00 59 98.3 200 �00 40 �00 �47 97.4 566 99.�

Total �20 �00 60 �00 200 �00 40 �00 �5� �00 57� �00

Focused Group Discussions in respect of ContractorsDuring this survey discussions were held with 24 contractors. At the outset, they stated that they are fully complying with all the relevant provisions of the Act. The companies/owners do not award contracts to the contractors without meeting all the requirements of the legal documents needed for the same. They are therefore carrying out the contract work in accordance with Act.

During these discussions, they explained how difficult it is to procure labour on contract, and after procuring them, how difficult it is to retain them and then to get the target oriented work done from them. In their opinion, they do not get the contract labour to work at the wage rates paid by the owners/companies. At the local level it is practically impossible and hence they are required to procure the migrated workers/ labourers, by offering several special concessions and facilities to them. Sometimes if payments from the companies are delayed, they are required to make payments to the contract workers from their own pockets. The labour is required to be supplied to the companies at any cost. At times, even by paying higher wages or by offering various concessions/facilities etc. to them, they have to fulfil their obligations. If proper care of the labour is not taken, there is a possibility of them abandoning the jobs.

It is observed from the discussions held with the contractors that, they were not fully aware of the provisions of the Act. They were simply concerned about the number


of the labourers to be supplied. Many companies/owners however, appoint labour advisors for examining and getting them fulfil the legal aspects of the contracts and the contractors. It suits the contractors as well. Primarily, the contractors only supply the labour to the companies, but the task of allotting work to them and getting the work done from them, is carried out by the companies in majority of the cases. The responsibility of getting the work done from the labour is not that of the contractors.

In our survey it was observed that a sizeable number of contractors interviewed happened to be the relatives of local politicians or enjoyed political support. Their behaviour with the labour was rude. They seem to have continued in this business, thanks to their ability to keep the company officials as well as influential persons in the office of the respective labour commissioners in good humour.

During this survey it was not possible to collect any detailed information from the contractors. They did not show any record. Probably they did not maintain much record. The large companies which hire the contract workers from these contractors fulfil the legal requirements in respect of the contractors. In case of small and medium companies the responsibility of the contractors was limited to supplying the contract workers. These contract workers were in gear of the contractor. The contractor employed a separate supervisor to keep an eye on those contract workers. It was observed that the contractors posed themselves as ‘Employment Bureaus’ under fancy names, for their businesses. It was noticed that many such ‘Employment Bureaus’ had cropped up near the industrial areas at Chakan, Ranjangaon and Sanaswadi in Pune district.

Most contractors expressed displeasure against the records to be maintained as required under the Act. They stated that the said requirement was very complicated. They also complained that they were harassed by the staff of the Labour Commissioner for the inspection of the record. Similarly during this survey we heard a complaint that the office bearers of the big unions also threaten them, from time to time.

In general the contractors raised various complaints rather a series of complaints during the discussions with them. They tried to make a point that they were the real protectors of interest of the contract workers. They stated that the contract workers were made to suffer the injustices because of the collusion between the Government officers and the owners of the companies/establishments.

FGDs with the Owners / Principal EmployersAs a part of this study Focused Group Discussions (FGDs) were also held, with the owners/employers who are important constituents in the implementation of the Act. They were asked with the help of the questionnaire, about the usefulness of the Act and also about its implementation. Outcome of those discussions are as under:


The owners stated that they were following the Act in the letter and the spirit. They replied to all the queries of the questionnaire and their response was positive. They informed us that they were strictly observing the practices as prescribed under the Act in respect of all matters, especially the following:

�. Registration under section 7 and licences for the contractors under section �2.

2. Make payments to the contractors in accordance with conditions mentioned in the licence.

3. Ensure that the labour is paid, by the contractors, in accordance with the conditions stated in the licence.

4. Ensure that the minimum wages Act is followed by the contractors.

The owners/employers readily provided the information about the number of contract workers and the contractors engaged by them. Similarly they provided the information about the type of work done by the contract workers. Some of them stated that the labourers carried out all types of work, while some others mentioned the following types:

�. Packaging.

2. Housekeeping.

3. Cleaning.

4. Cutting, fabricating, finishing and polishing.

5. Machine Operating.

6. Loading-Unloading.

7. Sundry Help.

8. Washing/Steaming.

9. Sorting.

�0. Checking.

��. Counting.

It is noticed from the said list that the contract workers were used for getting done even the main works. They however stated that the principle of equal pay for the equal work was not practised in their industries. Similarly for over last 5 years there was not a single case of Regulation in any of the establishments and the case of Abolition also did not arise.

The main reasons for employing contract workers stated by them are as under:

Flexibility of the number of labourers.No burden of ancillary/incidental wagesRelatively lower wagesNo unwanted responsibility of dealing with periodical demands.More efficiency.


The owners/employers therefore preferred the system of employing contract workers. They also happened to share their point of view related to the issues faced by them, during the discussions. The contract workers reported for work only when they were in need of the same. They were prepared to work even in shifts. They were not organised into a union nor were they able to complain to anybody in any matter. Even if they were removed from the work, there was nobody to fight for them. This practice of employing contract workers was therefore in their opinion, very convenient to them.

In an ideal sense, for the production of the best quality, the continuity in the employment of the skilled and loyal workers is highly desirable, but from practical considerations in the context of rising labour costs and unreasonable demands of the permanent workers, they were compelled to give up the concept of continuity of loyal workers, as told by them. Some of the employers however opined that, because of the system of contract workers, economic disparity is on the rise.

They further stated that the contract workers were paid as per the market conditions. In good seasons they were paid higher wages. And in case of rush job orders they were paid additional incentives according to the capabilities of the individual workers. Flexibility in the number of workers to be employed was the need of the hour, according to them. Therefore even though the Act was not very neat or convenient and even though they were facing some sort of trouble from the inspecting authorities, they considered that the Act was necessary in the present circumstances. However, they maintained that the amendments, if any, were to be made to the Act; they should be made after detailed discussions and open debate with all the stake holders.

Apart from the summary of views presented above, it would be worthwhile to reproduce the gist of responses from a sampling of the representatives of the industry owners / principal employers, gathered during the said survey, as below:

Krishna Gawde, Head – Personnel and Industrial Relations, Exide Industries (Mumbai)

The provisions under the Act are sufficient to take care of the contract labour.

Manoj Gurkhe, Asst. Manager – HR/IR/Admn., Kaycee Industries (Mumbai)

The Act is adequate to protect the contract labour but an amendment is needed for establishing machinery for redressing the grievances.

Sanjay Jadhav, General Manager – H.R., IPCA Laboratories Ltd. (Mumbai)

Contract labour system is welcome, as it generates employment opportunities. As regards protection and welfare of the contract labour, it is the contractor who needs to be held responsible.


Madhav Sawargaonkar, Director – Human Resources, Pfizer Ltd. (Navi Mumbai)

The Act is being misused across the country. A railway, the single largest employer in the public sector, has maximum number of contract labour. The Act is not being administered effectively, because of the corrupt bureaucracy. Where particular principal employers who base their business practices on value systems, not only comply with the Act but also follow certain good practices that benefit their contract labour. Trade unionism has become more of a business than a cause; you will find very few committed to the same which explains as to why they are not taking up the contract labour’s issues as they should be.

Sharad Patil, Secretary General – Employers’ Federation of India

The provisions under the Act are quite sufficient to take care of the concerned issues. But, the key lies in its proper implementation.

FGDs with the Government MachineryThis FGD session for observing the effective implementation of the Act by the Government machinery was restricted to the offices of the Labour Dept. Accordingly, offices of the Assistant Labour Commissioners were visited and discussions were held with the Assistant Labour Commissioners and Labour Inspectors and other various such officials about the Act. Efforts were made for obtaining statistical information in respect of Act. Despite frequent visits to these offices, the requested statistical information was not made available officially to us. On the contrary, those officials told us that it was very difficult to supply the said data directly and advised us to approach them for the same under Right to Information Act (RTI). Finally we did approach them under the RTI and tried to obtain the required data for this study. The information received from them is presented in the following paragraphs:

1. Staff Availability for the Implementation:Firstly information about the strength of the staff available in the offices of the Assistant Labour Commissioners for the implementation of the Act was obtained, because it is one of their duties to oversee the implementation of the Act. They were asked as to whether the available staff was adequate to fulfil that task. Out of the 5 districts surveyed for this study, we did not get the necessary information from the office of the Assistant Labour Commissioner of Mumbai district. The information obtained from the remaining officers is presented is as under:


Table No. 20 Available Staff in the Offices of the Assistant Labour Commissioners

Designation Pune Nashik Thane A. badAssistant Commissioner � � � �

Labour Inspectors �4 (3) 4 (�) �6 (4) �6 (2)Registration Officers 7 (3) 3 6 (4) 3 (3)

License Officers 7 (3) 3 6 (4) 3 (3)Clerical 3 (3) 2 (2) 8 (4) �4 (�2)Others 3 � 0 6

(The figures in the brackets show the vacancies)

It is seen from the above as well as from the discussions held with the Assistant Labour Commissioners that the available staff is quite inadequate for the effective implementation of the Act. According to them, this is the main reason for the lacuna in this respect.

Licenses Issued to the Contractors:The data in respect of licenses issued to the contractors by the offices of the Assistant Labour Commissioners during last 5 years, together with the number of contract workers covered under these licenses, was also obtained through the RTI and the same is presented in the following table:

Table No. 21 Details of Licenses Issued and Number of contract workers

Item /Year 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Pune

No. of Units 348 8�6 962 924 ��40

No. of Registered Contractors 348 8�6 962 924 ��40

No. of Contract Workers 2��53 4598� 63784 65473 4656�

Nasik

No. of Units 20 46 33 48 28

No. of Registered Contractors 38 85 46 95 59

No. of Contract Workers �049 3637 2899 3602 �842

Thane

No. of Units ��00 �500

No. of Registered Contractors �600 2000

No. of Contract Workers

Aurangabad

No. of Units 50 8� �32 38 57

No. of Registered Contractors �95 �90 425 226 259

No. of Contract Workers 63466 69557 666�� 8300


It is seen from the above that there is no uniformity in the issue of licenses. In Pune district it appears that only one contractor is registered per unit. This, however, does not appear to be true as generally separate contractors are appointed in different departments of the units. The information obtained from Thane district is quite disappointingly vague and incomplete. Same appears to be a case in respect of information of Nasik district especially the number of registered units and the number of contractors shown appear to be doubtful. These numbers appear to be much less than the actual as compared to the present number of units working in the district. If the number of registered contractors is so small, then there is certainly a room for believing that there are a large number of unregistered contractors working illegally in this district. Generally it can be concluded that the data furnished is far from reality and it appears that there is a lack of sincerity in providing information even to the queries of RTI.

2. About Inspections:Attempt was also made for collecting the data about the actual number of units inspected by the offices of the Assistant Labour Commissioners. The data obtained is shown in the table below:

Table No. 22 Details of Inspections Carried Out

District/Year 2007-2008 2008-2009 2009-2010

Units Inspected No. of Prosecutions Launched

Pune 2�43 �360

�6 45

Nasik �262 89� 469

2 6 �

Thane �800 �750

0 0

Aurangabad 4�4 ��6 240

50 57 57

The data presented above is self-explanatory. Firstly the information for 5 years asked for was not made available. The deficiencies in the implementation of the Act become evident from the data pertaining to actions taken after inspections, made available even for 3 years.

Further these offices were asked about the number of cases finally taken to the State Advisory Board, out of the cases in which prosecutions were launched. The reply received was quite disturbing. Out of 4 districts only 4 cases that too from only from Nasik district were taken to the Board.


It is clearly seen from the above data of 4 districts that the offices of the Labour Commissioners were unable to provide justice to the contract labours. The inspections carried out were more of eyewash.

When the issue was discussed with the Assistant Labour Commissioners and Labour Inspectors, they frankly admitted that on many occasions, when they went for inspections, the owners of the units did not provide correct information and they hid the contract workers. The contract workers themselves also do not come forward to complain because of the pressure from the owners and they found themselves helpless in the matter. This sort of helplessness was expressed by all the officers of the Assistant Labour Commissioners contacted for the survey. They carry out the inspections, when they receive complaints about payment of lesser wages, the number of hours of work being more and allotment of type of work to the contract workers which is supposed to be carried out by the regular/permanent workers etc. Such inspections are also carried out on regular basis. But because of the absence of the factual information, they say, they are unable to take any action in the matter.

It was however stated that, during these inspections if they notice that these contract workers are not provided the required facilities, these units are penalised. But since amounts of penalty are so ridiculously low (Rs. 500/-), there is no effect or pressure on either the contractor or the owner of the unit.

Prima-facie it is shown that these contract workers are not allotted the work of the regular/permanent workers. It therefore becomes practically impossible for converting these contract workers into regular/permanent workers. Again the procedure of the State Advisory Board is so lengthy and complicated that the contract workers are not in a position to receive justice from the Board. Hence, these officers opined that, despite the inspections the contract workers remain deprived of their legal rights.

3. Central Advisory Board.In this context, the information provided by the Central Advisory Board on all India basis, is given below for ready reference.


Table No. 23 Enforcement of Contract Labour (R and A) Act, 1970

Sr. No.

ItemYear

1996 1997 1998 1999 2000

�No. of Registration Certificates Issued to

Principal Employers375 425 639 670 658

2 No. of Licenses Issued to Contractors 36�3 4660 547� 6632 7734

3 No. of Inspections Conducted 4653 3956 4263 528� 5479

4 No. of Irregularities Detected 7254� 70709 65509 58936 834�4

5 No. of Prosecutions Launched 3705 3330 3�47 3805 3857

6 No. of Convictions 2770 2240 2060 20�9 2�26

7No. of Contract Labourers Covered by

Licenses489776 588678 6642�6 762425 773849

8 No. of Licenses Revoked/Cancelled 757 �37� �669 �099 3562

9 No. of Registration Certificates Revoked 23 0 0 0 2

* Total no. of licensed contractors at the end of the year 2000: 24208.

Table No. 24

No. of Cases Received / Disposed of During the Last Five Years under Rule 25 (2) (v) (a) and (b) of the Contract Labour (R and A) Central Rules, 1971

Relating to Payment of Wages.

YearNo. of Cases Received During the Last Four Years

Under Rules 25 (2) (v) (a) and (b)Order Issued

�996 4 �

�997 6 4

�998 �5 3

�999 35 5

2000 23 20

** Rules 25 (2) (v) (a) of Contract Labour (R and A) Central Rules, �97� has been amended vide notification No. GSR 4� (E) dated 2�st January, �999 delegating powers to the Deputy Labour Commissioners (Central) instead of the Chief Labour Commissioner (Central).

It is seen from the above during �996-2000 only 25 registration certificates have been revoked in the entire country on account of irregularities committed by the contractors / establishments.

The same data presented for the latest period i.e. 2003-2004 to 2008 – 2009.


Table No. 25

Enforcement of Contract Labour (R and A) Act, 1970.

Sr. No.

Item 03-04 04-05 05-06 06-07 07-08 08-09

�No. of Registration Certificates Issued to Principal Employers

720 590 675 752 8�9 930

2No. of Licenses Issued to

Contractors6788 7277 6973 9280 9587 �0389

3 No. of Inspections Conducted 499� 4540 5663 5365 6843 6925

4 No. of Irregularities Detected 7�632 5930� 59298 77422 �0440� 94�62

5 No. of Prosecutions Launched 3896 3356 29�4 2648 3675 3573

6 No. of Convictions 2072 20�8 �000 887 �228 733

7No. Of Contract Labourers

Covered by Licenses853690 968792 97�570 �00�947 �3�3742 �3776�0

8No. of Licenses Revoked/

Cancelled40�4 660� 7578 8�86 5657 74�9

9No. of Registration Certificates

Revoked52 8 2�� 5� �4 35

Table No. 26

No. Of Cases Received/Disposed of During the Last Five Years under

Rule 25 (2) (v) (a) and (b) of the Contract Labour (R and A) Central Rules, 1971

Relating to Payment of Wages.

YearNo. of Cases Received During the Last Three

Years Under Rules 25 (2) (v) (a) and 7 (b) Order IssuedB/F Received Total

2003-2004 33 � 34 �8 �6

2004-2005 �6 2 �8 �2 6

2005-2006 6 0 6 4 2

This can be considered as a great defeat of the implementation of the Act. The same

is the case in respect of cancellations of the licenses. The year 2006-07, is the year in

which the maximum number (8�86) of licenses were cancelled or revoked in the entire

country in a single year. If we assume that at least 200 districts are connected with

this cancellation, the average number of cancellations per district works out to 26.

In the Parliament the Union Minister of Labour and Employment Mr. Mallikarjun Kharge

gave the following information regarding action taken for violation of various labour

laws and details of inspection conducted and prosecutions launched under various

labour laws are as under.


Table No. 27

Sr. No. Activity 2006-2007 2007-2008 2008-2009 2009-2010 (Prov)

� No. of Inspections 3�265 447�3 40725 35824

2 No. of Irregularities 366326 358��6 347875 320�28

3 No. of Prosecutions �3049 �0647 �2565 ��968

4 No. of Convictions 4446 6409 7289 7540

These figures are sufficiently eloquent of the state of implementation of the Act, in the entire country. In general the Government machinery is found to be greatly wanting in this matter and therefore enforcement of law has generally be suffering. Thus it will be seen from the above information that it is self-evident and it is not necessary to go deeply in the matter of inefficiency of the Government machinery.


Chapter V

Views of Trade UnionsThere are many organisations of the workers which are engaged in protecting the interests of the workers. The contract workers are also part of the worker community and as such they are important for the trade unions. It was therefore decided to hold discussions with them in connection with the implementation of the Act. Accordingly discussions were carried out with the representatives of the following trade unions:

�) Bharatiya Mazdoor Sangh (BMS)

2) The Indian Trade Union Congress (INTUC)

3) All India Trade Union Congress (AITUC)

4) Centre for Indian Trade Unions (CITU)

5) Hind Mazdoor Sabha (HMS)

6) Sarva Shramik Sangh

7) Bharatiya Kamgar Sena

8) Maharashtra Trade Union (Pune)

9) Transport and Dock Workers Union, (Mumbai)

�0) Mumbai Port Trust, Dock and General Employees Union.

��) Mumbai Mazdoor Sangh.

Following points were kept in mind while carrying out these discussions:

a) Efficacy of the Act

b) Status of implementation of the Act

c) The advantages derived if any of this Act, by the contract labour

d) Improvements needed to be made in the Act

Similarly information about the role played by these trade unions for the protection of the interests of the contract workers was also collected during this interaction with them.

It was seen that in most of the major trade unions there were separate independent ‘wings’ for the contract workers, but as stated above independent trade unions of the contract workers were not found during the survey. Even the ‘Sarva Shramik Sanghatana’ which is an organisation mainly working in the unorganised sector and which has organised workers of the fourth class, have not entered the field of the contract workers.

Contract workers are not accepted as members of the unions of the permanent employees.


At some places where efforts were made for organising the unions of these contract workers, the owners of the establishments threatened to close the units or to terminate the services while some others actually closed them. As a result, the contract workers themselves are/ were reluctant to form the unions, due to fear of termination of job; despite the constitutional grant

During the discussions with these trade unions and other existing organisations, it was stated by them that it was extremely difficult to organise independent trade unions of these contract workers. The reasons put forth by them were as under:

�) These contract workers feared that if they joined a Union, or complain in any way or opposed the employer, they would be removed from the work and thus would lose the jobs. Since they were living in a hand to mouth situation, there were limitations for being mentally prepared to fight against the injustice done to them. Hence, they cannot be persuaded to come together and be prepared to join the Trade Union movement. The helplessness of the contract workers was the main obstacle in organising them into a trade union.

2) Even if they are organised, it becomes a futile exercise because of the absence of strict implementation of the Act, and due to same reason these workers’ unions fail to provide necessary protection to these contract workers against the injustice done to them.

However, though there are no independent unions of these contract workers, the organised unions of the permanent employees try to help and solve whenever some problems of the contract workers arise. In fact the unions of the permanent employees help to bring to the surface the problems of these contract workers. It also certainly remains a fact that these unions of the permanent employees are not in a position to give priority to solving the problems of the contract workers in the same proportion, in comparison with those of the permanent employees.

The existing trade unions however, are trying to solve the problems of the contract workers in their associated industries/companies wherever possible. The first important matter which came to be noticed during this survey was that, there was only one independent union of the contract workers named ‘Mahindra Hitoday’ in existence in MIDC area in Pune district at Bhosari, which was working for the interest of those contract workers. Efforts were being made by BMS, for organising the contract workers of a private factory, into a union at Ranjangaon MIDC area. Similarly efforts are on by the same BMS for organising a union of the contract workers working for Pune Municipal Corporation, through a company called ‘Vidya Online’ on contract basis. Here BMS had successfully fought against the injustice done to contract workers employed by the contractor company ‘Vidya Online’ in 2005. This has further boosted the idea of organising contract workers.


The BMS has also taken in hand the problems of the contract workers working in private companies in MIDC areas, and public companies like Maharashtra State Electricity Distribution Company Ltd. (MSEDCL), and the transport wing of the PMC etc. The HMS has successfully stopped the practice of ‘out sourcing’ by the companies in Nashik. The Sarva Shramik Sanghatana has undertaken the programme of creating awareness among the contract workers in the PMC about their problems and possible solutions for them and also implementation of a plan for their welfare, their medical check-up etc. Similarly the INTUC and CITU have given emphasis on organising workshops and dissemination of information.

Basically, these trade unions are first committed to and hence are engaged in carrying out various activities for the benefit of only the permanent workers of the industrial establishments. Their fields are also quite large and as such they are naturally obliged to give emphasis on restricting their activities related to the permanent workers. However, while discharging their duties to their members, if they come across any problems of the contract workers, they do try to help these contract workers and provide the needed assistance to overcome their problems wherever possible. But they are not found to be taking up any independent activities for the contract workers.

In this context, it has come to notice during this survey that there is a new trend of ‘labour aristocracy’ which has started taking roots in this field. Owing to which a new problem has arisen wherein the organised unions are not inclined to take up the cause of the Contract workers as taking up their cause for absorption may adversely affect the existing service conditions and benefits of the permanent workers.

When the above issues were discussed with the above unions of the permanent employees, they clearly accepted that they had not succeeded in giving justice to the contract workers. There is no new recruitment of the permanent workers and their wages are also comparatively much higher and because of this there is a growing tendency of employing contract workers on a larger scale. The contractors do provide the needed contract workers as required by the companies/establishments. The owners of these companies/establishments have practically no responsibilities/obligations towards these contract workers. Hence this system of engaging contract workers is on the rise everywhere. These contract workers can’t go to the courts for the redressing instances of injustice done to them. Similarly they do not get adequate and necessary response from the offices of the Labour Commissioners. It, therefore becomes very difficult to solve the problems of the contract workers. Further these contract workers cannot be relied upon, as they rarely participate in the strikes and peaceful demonstrations organised by the unions of the permanent employees. There are difficulties faced by the unions in respect of raising demands and espousing the cause of the contract workers Further, owing to the nexus amongst the principal employer, contractor and politicians, the contract workers are not regularised but are continued in the status of Contract workers even there is an existence of regular work. In some cases it is found that the politicians head the trade unions and use


their influence over the employers to continue contract workers in place of necessity of regular workers. This also becomes a stumbling block for the contract workers for fighting against the injustices. The experiences of the unions of the permanent employees generally appeared to be as under:

Equal wages for equal work Little success in implementing the principle

Adopting the principle of ‘Abolition’ for absorbing the contract workers as permanent workers

Near failure

Going to Courts for redressing the injustices Nil

Attempt to take the cases to the State Machinery Little success

Organising the contract workers Little success

In short, the unions of the permanent employees are not much successful in solving the problems of the contract workers. Similarly, according to these unions, the inaction on the part of the offices of the Labour Commissioners as well as the deficiencies in the implementing agencies of the Act contributes to the failure to achieve the expected success in the matter.

To some extent however, these unions have succeeded in some instances in giving relief to these contract workers. For example they were instrumental in causing increase in wages, assurance of regular payment of wages, reducing the hours of work and making available the medical and canteen facilities while they were employed, to these contract workers.

Similarly, they fully supported the cause of safety of contract workers working in establishments involved in activities which were hazardous to health, in respect of their demands. For example they discussed the issue of injuries caused while handling hot iron during summer, with the management. They also helped in issuing safety tools and uniforms to these contract workers in such establishments.

They also mentioned the help given to the contract workers who were working for nearly 20 years in organising the struggle in ONGC and raising the issue of the safety of the contract workers working in MSEB etc.

The important achievements of the trade unions in this regard are:

�. They have pointed out the drawbacks/ deficiencies in the Act.

2. They have demanded in a number of ways, even up to Central Government level, for the amendments/improvements in the Act.

3. They have submitted several proposals to the labour commissioner regarding the regulation and abolition etc. and have followed them up.

4. They have held a number of seminars and workshops for enlightening these contract workers in respect of their rights and obligations.


5. They have tried to solve the disputes between the contract workers /contractors and the employers through informal discussions.

6. They have also tried to make available the facilities to the contract workers to which they are entitled to, in the industries or factories/establishments with whom they are associated.

Despite the above efforts on their parts, it can be stated that the said unions are rather sceptical about the implementation the provisions of the Act. They are of the opinion that the administration existing on ground for the implementation of the same is weak and totally ineffectual as well as partisan in favour of the owners. According to them the State Advisory Board is a pure and complete eye-wash, inasmuch as, it is very difficult for Contract workers to approach the Advisory Board for relief. Therefore the provision about regulation and abolition has remained in the law book. Further most of the contractors are from the political field. They themselves or their relatives are the workers of the political parties. This makes it practically impossible to get problems of the contract workers solved through the offices of the labour commissioners, which are not amenable to the idea, due to the political clout or patronage enjoyed by the said contractors.

The opinions of the trade unions in respect of the changes needed in the Act, appeared to be as under:

�. The principle of equal pay for the equal work should be made obligatory on the part of the contractor under section 25(�) of the Act, while granting permission to the contractor.

2. Under the provisions of Chapter V B of the Industrial Disputes Act �947, workmen cannot be retrenched from the work without the permission of the Government, if the workmen’s strength in the unit exceeds �00. Unscrupulous employers bypass that provision by employing contract workers through a contractor, while keeping the permanent workmen’s strength below �00. In the opinion of the trade unions, the Act has been enacted solely for the purpose of nurturing the institution of contractors in the industrial field. Some of them are of a firm opinion that it should be repealed. There are some trade unionists who want the Act to be amended suitably for effective implementation.

3. The existing provisions of the Act, as per the Unions, are such that a contract worker, though he is carrying out the work of ‘permanent’ nature, will remain a contract labourer for ever. This is because the Act does not elaborate as to what types of works should be given and should not be given on contract. So also there is no mechanism available with the Government for collecting and verifying the information about the types of work carried out by both the type of workers.


4. The process of abolition is a very long drawn one. It goes on for years together but no decision is arrived at. The concerned players in this matter also are not fully aware as to when the meetings of the Advisory Board Members are held. The contract workers also do not know of such meetings. In these circumstances, implementation of provisions regarding the abolition can never take place.

5. In the opinion of the Hamal Panchayat, this Act should not be made applicable to ware-houses, where the work of loading and unloading is done on a large scale.

6. This Act has become totally ineffective, because there is no provisions under which the labourers could have approached the courts for the justice, directly.

7. The provision under Rule 25 of the Act that, if the minimum wages are not paid to the contract workers, the contractors should be prosecuted under criminal laws should be implemented very strictly and exemplary punishment both to contractors and the Principle Employers, by way of imprisonment and penalty should be awarded.

8. The contract workers should be brought under the ambit of the Industrial Dispute Act by repealing the Act.

9. An independent board should be established exclusively for the contract workers as on the lines of Mathadi Board.

Apart from the range of opinions of the trade unionists as gathered and presented above, it would be worthwhile to reproduce below a sampling of a few of their prominent representations, as below:

I. R.V. Subba Rao, Member – National Executive committee (BMS) and Member – Central Advisory Board (Contract Labour), New Delhi Indian judiciary was the first to realise the extent of exploitation of labour by the contract system. The Act was brought on the statute book due to judicial pronouncement of as early as �962. The provisions of the Act are inadequate to reflect the objective, indicative of the indifferent attitude of the people’s representatives while making law. Status of contract labour in the event of prohibition under section �0 of the Act, was left to the vagaries of the employer. It was the judiciary that interpreted and tried to bridge the lacunae by ordering regularisation of the services of contract labour. The Supreme Court judgement of �995 in the Gujarat Electricity Board case is a landmark. Here the executive failed to take note of and review the contract cases as per the parameters of section �0 of the Act. Of late, the judiciary has become indifferent to the social objective and justice, as could be seen from the judgement of 200� in the SAIL case. The fragmented and political trade unions failed to rescue the contract labour.


II. Suryakant Mahadik, President – Bhartiya Kamgar Sena, Mumbai. He had looked forward to better handling of contract labour issues after the enactment of the Act in �97�. But, looking back he feels that it has not delivered what it promised to, till date. Large-scale engagement of contract labour in the manufacturing process activities and in perennial jobs, which is actually prohibited by the Act, can be seen everywhere. Even in the banking sector, one would notice contract labour engagement in various forms, for doing perennial jobs. In the eventuality of abolition of contract labour in any establishment, the displaced labour of the old contractor should be hired by the new contractor. His other demands / recommendations include standardisation of an acceptable ratio between the permanent and contract labour in any establishment across industries, equal pay for equal work, inclusion of contract labour under the Standing Orders Act, �946, creation of machinery for redressing their grievances. He also talks about the need to permit the principal employer to hire contract labour directly, coupled with an inbuilt flexibility to reduce their numbers on need basis. However, such breaks in their service should be treated as no break, for future opportunities for permanency, if any, that may be based on seniority.

III. P.N. (Dada) Samant, President – Maharashtra General Kamgar Union, Mumbai. He recommends amendments to the Act, for extension of its applicability to establishments engaging �0 contract labour instead of current 20 numbers. Secondly, he recommends substitution of the word ‘any’ by ‘non-core’ under section 2(�)(c) and addition of a provision for a hearing for an existing union before registration of the establishment under the Act, to resist engagement of contract labour in perennial jobs. He quotes an example of a reputed MNC viz. Fiat India Ltd. Who took over Premier Automobiles Ltd., eventually moved its Mumbai manufacturing facility to Ranjangaon near Pune. While Premier had all permanent workers on its pay-roll earlier, the new site of Fiat has practically engaged mostly contract labour for its operations, supplied by locally influential political leaders. He is quite blunt in calling the Government officials as the main culprits for the situation, as they have failed in their duty of implementing the Act.

IV. Suryakant Bagal, General Secretary – Hind Mazdoor Sabha (Maharashtra), Mumbai.The concept of social justice, which had always been the guiding principle for the administration and the judiciary, started losing ground post �99� when India embarked on liberalisation and globalisation. The unholy alliance of powerful capitalists and Government Machinery serving only their interests, came into being. It caused bottlenecks in delivering justice to the contract labour, where they were fighting against injustice. Even when a favourable verdict was delivered by a lower Court, the industry establishments always appealed against it, as a rule, to make things unviable and more difficult for the concerned contract labour. ONGC, a renowned


profit-making public sector company is a prominent case in point. It has been fighting several court cases in the context, since �99�, four of which pertain to contempt of Court, for having failed in complying with the Courts’ orders. In one of the case involving 76 contract labour, it worked out an out of court settlement scheme that was accepted by 7� workers, who withdrew from the case. Out of remaining 5, one died in due course and one went missing. ONGC is still bent upon fighting the case against the remaining 3 workers who have withstood the pressure for relenting, but wouldn’t consider regularising their services, thus squandering crores of the public money. Mr. Bagal recommends amendments to the Act for absorbing contract labour as permanent workers post abolition of contract system and also under section 5(2), where no concerned contract labour should be removed from work, till the Advisory Board delivers its decision in the case pending before them.

V. Govind Balkrushna Sawant, Secretary – Kamgar Aghadi, Mumbai.Mere capital does not make an industry. It has to collaborate with labour to generate wealth. Due to large-scale unemployment in the country, you can buy labour very cheaply. The most exploited labour in this context is the contract labour. Industry started exploiting this factor indiscriminately post �995, under the garb of reducing costs and increasing productivity. The breed of the middlemen called contractors, has largely emerged from among the political parties’ workers associated with influential politicians in the respective areas, which deters the Govt. officials from initiating appropriate enforcement of the Act. If and when the appropriate Government abolishes contract labour, all concerned labourers are thrown out of jobs. When they want to appeal against such arbitrary action, the principal employer denies any relationship with them. The contractor raises his hands by blaming it on his contract having been abolished. Thus, the provision under section �0 of the Act that provides for abolition of contract labour, is like throwing baby out along with the bath water.

VI. Vasudevan Nambiath, General Secretary – CITU, Mumbai.He acknowledges the contract labour system as a severe challenge to the Indian labour movement and has formed ‘Forum Against Contract Work’ (Thekedari Pratha Virodhi Manch) to deal with it. He condemns the lack of political will and capacity of the Govt. to enforce the legal rights of contract labour, even after 40 years of enactment of the Act. He also laments the fact that the contract labour movement has not emerged as an autonomous struggle, which should broaden and deepen the Indian trade union movement. He acknowledges the importance of moving beyond all political divisions and coming together and build an organisational process & capacity to shape an independent strategy, programme and mobilisation. He even promotes the idea that the struggle of contract labour has to move beyond legal battles and mobilise militancy to eliminate it. He, inter alia, recommends amendment to the Act, as regards the composition of the Advisory Boards, where the Chairman should be a person of eminence in public life such as retired High Court judge.


Chapter VI

Views of Labour Law Practitioners, Consultants and Educationists

At the backdrop of the survey that covered the elements who have direct stakes in the subject matter, it was also important to obtain the opinions of independent professionals, who possessed knowledge on the subject. A few prominent representations of the said lot have been presented below:

I. Adv. Sanjay Singhvi (Lawyer for employees), Mumbai.

He feels that Contract labour today is more widespread and more abused and

exploited than when the Act came into being. According to him, the main lacuna in

the Act, is the absence of any forum for redressing the contract labour’s grievances.

He also points at the provision under section �2 of the Act, for investigation before

issuance of licence to a contractor, which can be used to examine whether the said

contract pertains to the type of work prohibited under section �0 of the Act, which is

not happening. He also points at Government records, showing only �50 cases from

�970 till date, where the wages of contract labour were fixed as per Rule 25 under the

Act, as a sign of abuse. As regards functioning of the Advisory Boards under the Act,

he says that some are diligent but some are callous too and it depends completely on how they are constituted.

II. Adv. R.D. Bhatt (Lawyer for employees), Mumbai.

The Government machinery doesn’t fulfil its obligations under the Act, beyond issuing

registration certificates and licences. The advisory Boards are ineffective. He, like

Adv. Singhvi, points at the constitution of the Boards, where the Labour Minister is the

Chairman, whereas such Boards are expected to function independently. He laments

that judicial pronouncements of the Apex Court have made it more difficult for the

contract labour to get security of tenure and fair wages. He is also critical of trade

unions, some of whom acquiesce with the employer in engaging contract labour in certain jobs.

III. Adv. K.M. Naik (Lawyer for employers), Mumbai.The Act takes care of contract labour’s interests fully, who are benefited by it more that the employers. Hence no amendment to the Act needed, not even for agitating grievances.


IV. Late Adv. C.V. Pawaskar (Lawyer for employers), Mumbai.The very nature of contract work means it is for a limited duration. Therefore, there is no question of claiming permanency. Secondly, the Act has made adequate provisions for the protection of contract labour and also the machinery to ensure it. However, a board akin to that under the Mathadi Act can be set up to address their issues.

V. P.M. Mantri, Labour Advisor, Mumbai.While it was not intended by the Act to provide permanent employment, it is a common knowledge that success of any law depends on its enforcement, which has failed in the case of the Act. It certainly needs amendment, to provide for the right to the contract labour to agitate their grievances before a judicial or quasi-judicial authority. He agrees that the percentage of pragmatic employers is small, who comply with the Act in letter and spirit.

VI. Dr. Krishna Murthy, Industrial Relations Consultant and Editor of ‘Arbiter’ journal, Mumbai.The Act is an anachronistic piece of legislation that seeks to deal with an economy that has transformed drastically, at it came into being in an environment that was the anti-thesis to the present day highly competitive and dynamic world. He substantiates his comment by pointing at the prevalent practices of outsourcing functions like payroll, maintenance and using the temporary staffing services run by domestic as well as multinational firms, adopted in the corporate world, apart from the commonly known jobs like security and housekeeping, which according to him, is the direct outcome of certain provisions under the Industrial Disputes Act, �947 that prohibit flexibility in manufacturing operations. It is also the cause behind principal employers keeping away from providing common benefits even training to contract labour, for fear of future claims of permanency. As regards the Act, he feels that it is not toothless per se but the flip side of corruption within the enforcement machinery is the cause of its ineffectiveness, who according to him use the Act to threaten non-complying employers and extort money from them, especially before elections.

VII. V.S. Rajan (Advocate, Notary & Legal Consultant), ChennaiIt is important to distinguish between engaging contract labour and outsourcing i.e. commercial contracts for service, which are between user and service-provider. He feels that amendment to the Act is needed to prevent employers from using low cost contract labour as substitute to permanent workers; it should also provide for a loading for compensating the contract labour for loss of benefits as compared to the permanent workers, as a premium payable by the employers, for enjoying the benefit of flexibility.


VIII. Dr. Sharad Sawant, Ex-Director, Maharashtra Institute of Labour Studies (MILS), and Honorary Professor, TISCO Chair of Tata Institute of Social Sciences (TISS), Mumbai.Research has shown that contract labour is a phenomenon widely seen in mofussil areas which is a practice followed by big industries when they shift out of metro cities. One way of managing contract labour would be to ensure that core labour be permanent, while non-core industries/occupations can be with contract labour. And in such cases of flexible labour model, a cost tag be attached- double or such rate of the nominal wages, as is practiced in countries like USA. The Act should see that the contract labour get benefits similar to permanent workers; they are paid through cheques, and provided with I-cards. If we wish for abolition of contract labour, we must insist on permanency instead. Without employment security there will not be any compliances with the statute, no provision of good working conditions. Just de-regulation will not serve any purpose. Improvements have to be effected in the present legislation; there is no need for a fresh legislation. The Act need to be amended-e.g the composition of the advisory board. Boards like the Dock Labour Board can be set up to regulate contract labour. Section �0 need to be amended in the light of the structural transformation in the industrial sector in India. Outsourcing of labour, by definition, be included as being in the purview of the Act. Ambiguity is a loophole that creates exploitation of workers, and is taken advantage of by employers. Various terms have to be made clear in the context of clarity when seeking justice for contract labour, such as-‘perennial work’, ‘core work’ and ‘regular work’ in the present context. In the provision of basic amenities like water, sanitation, training for health and safety, there should be no difference between regular and contract workers. Employer needs flexibility in the deployment of people, to meet the peaks and lows of the supply cycle. Some anomalies that take place in the process need to be corrected so as to ensure fair treatment to labour in the process. Contract labour will continue to be exploited as long as trade unions are not strong. On the other hand it is difficult for trade unions to deal with the contract labour which is dispersed all over industries and occupations. One can refer to an experience of the textile industry -that to the decasualization scheme- every worker at the time of leaving used to register in the decasualization scheme-this was officially valid procedure, though not a legal one. Similarly an agency can be created by trade union/NGO which will create a pool of workers (industry wise), functioning like an employment exchange for the contract labour market.


Chapter VII

ConclusionsAnalysing the matter presented in the foregoing chapters, the following conclusions can be presented.

�. The Contract Labour (Regulation and Abolition) Act �970 was enacted with a view to “the regulate the employment of contract labour the certain establishment and to provide its abolition in certain circumstances and for matters connected therewith.” However it is observed that this objective has not been fully achieved.

2. The object with which the Act was enacted, it is observed that, the same is not fully achieved.

3. Insufficiency of provisions of law has resulted in non delivering the intended justice to the contract labour.

4. Interpretations placed by the judiciary have added to the failure of achieving the desired results.

5. The machinery created by the government is hopelessly inadequate, not to mention inefficient, to execute the provisions of the Act and rules.

6. Apart from inefficiency there is an element of corruption which has been eating away at the system for the past several years, thus resulting in the failure of the Act.

7. It is observed that in several cases there is a large scale exploitation of the needy workers who have no alternative but to accept the terms offered by the Contractors/principal employers, in order to made two ends meet.

8. The contract workers in most of the cases are a floating community who have no alternative but to leave their places of residence and go wherever they find employment in whatever possible manner.

9. This situation is exploited by the persons whose main business is to provide supplying labour/ manpower, as per demand of the principal employers thus treating the workers as one of the commodities.

�0. These workers lack basic adequate education to aspire for better employment or to qualify themselves for it.

��. In this field for more than a decade and half there is great political interference and in many cases, the politicians act as contractors, which ultimately results in these workers becoming a gang of bonded labourers.


�2. It has been found that in some cases the contract workers are provided with basic amenities such as residence and other material requirement, under one roof, so as to ensure that they remain within the vicinity, entirely under the control of the contractor. In such cases they are not permitted to enjoy their leave as per the law.

�3. In order to avoid the clutches of law the principal employer prefers to engage workers on contract and not on his rolls, to show the workers’ strength to be less than �00. This is only to avoid the application of the provisions of the Sec. 25(o) and (n) chapter VB of the Industrial Disputes Act �947.

�4. The above position is also to be found not only in the private sector but also in the public sectors. Apart from this the contract workers many times suffer from either lesser payment and / or delayed payment of wages than that statutorily fixed by law.

�5. The Trade Unions of the organised workers do not and in many cases cannot take the cudgels on behalf of the contract workers, their main interest being protecting the interests of the permanent workers in the concerned unit. There is an exception to this in some cases, however, which are rare.

�6. The contract workers, though have a right of association under the Constitution cannot in fact, join a general union or form their own union as they are likely to lose the employment itself which worries them.

�7. The Boards created by the statute have been found to be totally useless as they have no powers to pass an order which is quasi- judicial in nature.

�8. The Court decisions given from �960 till date have been inconsistent with the aims and objectives of the Act.

�9. From the promulgation of the act till the SAIL judgement there appears to be grave consistency in view and interpretation.

Road to Potential Anarchy:An important aspect of this whole issue is that the contract workers themselves are too scared to fight their own cases. They do not dare to complain against anybody because of the dread of the intimidation by the owners/employers and the contractors. If anybody dares, he loses his job. They have therefore accepted this as their fait accompli. Even though a few trade unions try to take up their cause, they do not respond wholeheartedly, due to such fears. The instances of their success are far and few between.

As aforesaid, they belong to the weaker section of societ y from underdeveloped regions in India and are most likely to be coming from the socially less privileged or deprived class of society, typically ridden by the age old Indian caste system.


Their manual labour is the only thing they can offer to the outside world, for a living. They hope to rid themselves off the sufferings of poverty and a caste-ridden society and approach industry which they see as a manifestation of modernity as well as prosperity. Unfortunately, they end up working there as modern day traditional down trodden (read contract labour) who have only a hopeless future. Such frustrated people, alien to the insensitive administration and the rest of the society in general, can be a ready fuel to the already restive India, struggling to deal with movements like naxalism, which have roots essentially in a large-scale social unrest, arising out of feelings of injustice and hopelessness.

In the final analysis, if India Inc. wants not just faster growth but sustainable and inclusive growth, it will have to convert contract labour not only into a productive and workforce but also a happy part of society. If done earlier, it will be better for the overall progress of the economy and the nation. However, sadly enough, the present day Union Government including its top-most representative viz. The Prime Minister does not seem to think so. It appears from the speech of our beloved Prime Minister Dr. Man Mohan Singh as appeared in the Times of India, dt.20/02/�2, that the government in not inclined to take in to consideration the exploitative situation but only considers that if the contract labour offers ‘flexibility’ to the industry it would result in the growth of the economy in general. It is unfortunate that he did not utter a word recognising the need for the protection and welfare of the contract labourers, who possibly did not figure in his image of India.


Chapter VIII

Recommendations�. As per the Economic Survey of 2007- 08 and subsequent Economic Surveys thereafter over 90 % of India’s workforce include the self employed and employed in unorganised sector. The Ministry of Labour, Govt. Of India has a category the unorganised labour force under four groups in terms of occupation, nature of employment, especially distress category and service categories. Considering the fact that a large number of our workforce has been continuously marginalised we strongly recommend establishment of a National Commission for Unorganised Labourers on the lines of National Commissions for Schedule Tribes and Schedule Caste.

2. Certain organisations of employers, in the past have recommended distinction between “core” and “noncore” activities to be carried out by contract workers. On the basis of this suggestion the Andhra Pradesh and Goa governments have introduced an amendment to Sec. �0 of the act. We strongly recommend that emulating what the Andhra Pradesh and Goa governments have done should suitably amend the central act.

3. The Act should be amended to provide for;

3.� Absorption of employees performing the work of perennial or incidental nature where the government issues notification abolishing the contract.

3.2 Creation of the machinery for adjudication of disputes, as regards contract labour.

3.3 Section �0 of this act provided for Prohibition of Employment of Contract Labour. This section should be suitably amended to provide for an alternative avenue of approach for the aggrieved workers to ventilate the grievances through quasi-judicial machinery instead to adhering administrative machinery.

3.4 The provision with regard to the Advisory Board under the Act should be repealed and the jurisdiction in deciding such matter should be referred to the machinery under the Labour laws having powers to impart t judicial decision.

3.5 Definition of the terms worker / workman should be suitably amended on the lines of those provided under the Bombay Industrial Relations Act, so as to include contract labour under it.

3.6 “employee” means any person employed in or in connection with the work of any establishment to do any skilled, semi- skilled or unskilled manual,


supervisory, technical or clerical work for hire or reward in any industry, and includes-

(a) A person employed by a contractor to do any work for him in the execution of a contract with an employer

But does not include any such person

(A) …..

(B) ……

(C)…

3.7 Equal wages for equal work, to “strictly” be the responsibility of the principal employer, failure of which shall result in severe punishment, to the Principal employer and his agents.

3.8 A Method and procedure for regularization of the employment of contract labour or their absorption, post abolition of a contract work, should be provided for.

3.9 The term “Sham and Bogus contracts/ contractors” should be defined and included in the Act.

3.�0 Powers to the Inspectors under the Act, to inspect relevant records pertaining to the implementation of social security statutes viz. Provident Fund Act and Employee State Insurance Act, in addition to those available to the Inspectors under the said statutes.

3.�� The number of forms to be filled in by the employers (Principal/Contractors) should be minimized.


Annexure I

Contract Labour (Regulation and Abolition) Act, 1970

Brief Description of the Act.SECTION CONTENT

CHAPTER I: PRELIMINARY

�. Short title, extent, commencement and application2. Definitions

CHAPTER II: THE ADVISORY BOARDS

3. Central Advisory Board4. State Advisory Board5. Power to constitute committees

CHAPTER III: REGISTRATION OF ESTABLISHMENTS EMPLOYING CONTRACT LABOUR

6. Appointment of registering officers7. Registration of certain establishments8. Revocation of registration in certain cases9. Effect of non-registration�0. Prohibition of employment of contract labour

CHAPTER IV: LICENSING OF CONTRACTORS

��. Appointment of licensing officers�2. Licensing of contractors�3. Grant of licences�4. Revocation, suspension and amendment of licences�5. Appeal

CHAPTER V: WELFARE AND HEALTH OF CONTRACT LABOUR

�6. Canteens�7. Rest-rooms�8. Other facilities�9. First-aid facilities20. Liability of principal employer in certain cases2�. Responsibility for payment of wages

CHAPTER VI: PENALTIES AND PROCEDURE

22. Obstructions23. Contravention of provisions regarding employment of contract labour24. Other offences25. Offences by companies26. Cognizance of offences27. Limitation of prosecutions


CHAPTER VII: MISCELLANEOUS

28. Inspecting staff29. Registers and other records to be maintained30. Effect of laws and agreements inconsistent with this Act3�. Power to exempt in special cases32. Protection of action taken under this Act33. Power to give directions34. Power to remove difficulties35. Power to make rules

Contract Labour (Regulation and Abolition) Act, 1970

CHAPTER I: PRELIMINARY

Section 1: Short title, extent, commencement and application

�. (�) This Act may be called the Contract Labour (Regulation and Abolition) Act, �970.

(2) It extends to the whole of India.

(3) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for difference provisions of this Act.

(4) It applies –

a) To every establishment in which twenty or more workmen are employed or were employed on any day of the preceding twelve months as contract labour;

b) To every contractor who employs or who employed on any day of the preceding twelve months twenty or more workmen:

Provided that the appropriate Government may, after, giving not less than two months’ notice of its intention so to do, by notification in the Official Gazette, apply the provisions of this Act to any establishment or contractor employing such number of workmen less than twenty as may be specified in the notification.

2. (a) It shall not apply to establishments in which work only of an intermittent or casual nature is performed.

(b) If a question arises whether work performed in an establishment is of an intermittent or casual nature, the appropriate Government shall decide that question after consultation with the Central Board or, as the case may be, a State Board, and its decision shall be final.

Explanation - For the purpose of this sub-section, work performed in an establishment shall not be deemed to be of an intermittent nature –

i. If it was performed for more than one hundred and twenty days in the preceding twelve months, or

ii. If it is of a seasonal character and is performed for more than sixty days in a year.

Section 2: Definitions

(�) In this Act, unless the context otherwise requires,-

(a) “appropriate government” means-

(i) in relation to an establishment in respect of which the appropriate government under the Industrial Disputes Act, �947 (�4 of �947), is the Central Government, the Central Government;


(ii) in relation to any other establishment, the Government of the State in which that other establishment is situates;

(b) a workman shall be deemed to be employed as “contract labour” in or in connection with the work of an establishment when he is hired in or in connection with such work by or through a contractor, with or without the knowledge of the principal employer;

(c) “contractor”, in relation to an establishment, means a person who undertakes to produce a given result for the establishment, other than a mere supply of goods or articles of manufacture to such establishment, through contract labour or who supplies contract labour for any work of the establishment and includes a sub-contractor;

(d) “controlled industry” means any industry the control of which by the Union has been declared by any Central Act to be expedient in the public interest;

(e) “establishment” means-

(i) any office or department of the government or a local authority, or

(ii) any place where any industry, trade, business, manufacture or occupation is carried on;

(f) “prescribed” means prescribed by rules made under this Act;

(g) “principal employer” means-

(i) in relation to any office or department of the government or a local authority, the head of that office or department or such other officer as the government or the local authority; as the case may be, may specify in this behalf,

(ii) in a factory, the owner or occupier of the factory and where a person has been named as the manager of the factory under the Factories Act, �948 (63 of �948), the person so named.

(iii) in a mine, the owner or agent of the mine and where a person has been named as the manager of the mine, the person so named,

(iv) in any other establishment, any person responsible for the supervision and control of the establishment.

Explanation : For the purpose of sub-clause (iii) of this clause, the expressions “mine”, “owner” and “agent” shall have the meanings respectively assigned to them in clause (j) clause (l) and clause (c) of sub-section (�) of section 2 of the Mine Act, �952 (35 of �952);

(h) “Wages” shall have the meaning assigned to it in clause (vi) of section 2 of the Payment of Wages Act, �936 (4 of �936);

(i) “workman” means any person employed in or in connection with the work of any establishment to do any skilled, semi-skilled or unskilled manual, supervisory, technical or clerical work for hire or reward, whether the terms of employment be express or implied, but does not include any such person-

(A) Who is employed mainly in a managerial or administrative capacity; or

(B) who, being employed in a supervisory capacity draws wages exceeding five hundred rupees per mensem or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature; or

(C) who is an out-worker, that is to say, a person to whom any article and materials are given out by or on behalf of the principal employer to be made up, cleaned, washed, altered, ornamented, finished, repaired, adapted or otherwise processed for sale for the purposes of the trade or business of the principal employer and the process is to be carried out either in the home of the out-worker or in some other premises, not being premises under the control and management of the principal employer.

(2) Any reference in this Act to a law which is not in force in the State of Jammu and Kashmir shall, in relation to that State, be construed as a reference to the corresponding law, if any, in force in that State.


Contract Labour (Regulation and Abolition) Act, 1970CHAPTER II: THE ADVISORY BOARDS

Section 3: Central Advisory Board

(�) The Central Government shall, as soon as may be, constitute a Board to be called the Central Advisory Contract Labour Board (hereinafter referred to as the Central Board) to advise the Central Government on such matter arising out of the administration of this Act as may be referred to it and to carry out other functions assigned to it under this Act.

(2) The Central Board shall consist of-

(a) a Chairman to be appointed by the Central Government;

(b) the Chief Labour Commissioner (Central), ex officio;

(c) such number of members, not exceeding seventeen but not less than eleven, as the Central Government may nominate to represent that government, the Railways, the coal industry, the mining industry, the contractors, the workmen and any other interests which, in the opinion of the Central Government, ought to be represented on the Central Board.

(3) The number of persons to be appointed as members from each of the categories specified in sub-section (2), the term of office and other conditions of service of, the procedure to be followed in the discharge of their functions by, and the manner of filling vacancies among, the members of the Central Board shall be such as may be prescribed:

PROVIDED that the number of members nominated to represent the workmen shall not be less than the number of members nominated to represent the principal employers and the contractors.

Section 4: State Advisory Board

(�) The State Government may constitute a Board to be called the State Advisory Contract Labour Board (hereinafter referred to as the State Board) to advise the State Government on such matters arising out of the administration of this Act as may be referred to it and to carry out other functions assigned to it under this Act.

(2) The State board shall consist of-

(a) a Chairman to be appointed by the State Government;

(b) the Labour Commissioner, ex officio, or in his absence any other officer nominated by the State Government in that behalf;

(c) such number of members, not exceeding eleven but not less than nine, as the State Government may nominate to represent that government, the industry, the contractors, the workmen and any other interests which, in the opinion of the State Government, ought to be represented on the State Board.

(3) The number of persons to be appointed as members from each of the categories specified in sub-section (2), the term of office and other conditions of service of, the procedure to be followed in the discharge of their functions by, and the manner of filling vacancies, among, the members of the State Board shall be such as may be prescribed:

PROVIDED that the number of members nominated to represent the workmen shall not be less than the number of members nominated to represent the principal employers and the contractors.

Section 5: Power to constitute committees

(�) The Central Board or the State Board, as the case may be, may constitute such committees and for such purpose or purposes as it may think fit.

(2) The committee constituted under sub-section (�) shall meet at such time and places and shall observe such rules of procedure in regard to the transaction of business at its meetings as may be prescribed.


(3) The members of a committee shall be paid such fees and allowances for attending its meetings as may be prescribed:

PROVIDED that no fees shall be payable to a member who is an officer of government or of any corporation established by any law for the time being in force.

Contract Labour (Regulation and Abolition) Act, 1970CHAPTER III: REGISTRATION OF ESTABLISHMENTS EMPLOYING CONTRACT LABOUR

Section 6: Appointment of registering officersThe appropriate government may, by an order notified in the Official Gazette-

(a) appoint such persons, being Gazetted Officers of government, as it thinks fit to be registering officers for the purpose of this chapter; and

(b) define the limits, with in which a registering officer shall exercise the powers conferred on him by or under this Act.

Section 7: Registration of certain establishments(�) Every principal employer of an establishment to which this Act applies shall, within such period as the appropriate government may, by notification in the Official Gazette, fix in this behalf with respect to establishment generally or with respect to any class of them, make an application to the registering officer in the prescribed manner for registration of the establishment:

PROVIDED that the registering officer may entertain any such application for registration after expiry of the period fixed in this behalf, if the registering officer is satisfied that the applicant was prevented by sufficient cause from making the application in time.

(2) If the application for registration is complete in all respects, the registering officer shall register the establishment and issue to the principal employer of the establishment a certificate of registration containing such particulars as may be prescribed.

Section 8: Revocation of registration in certain casesIf the registering officer is satisfied, either on a reference made to him in this behalf or otherwise, that the registration of any establishment has been obtained by misrepresentation or suppression of any material fact, or that for any other reason the registration has become useless or ineffective and, therefore requires to be revoked, the registering officer may, after giving an opportunity to the principal employer of the establishment to be heard and with the previous approval of the appropriate government, revoke the registration.

Section 9: Effect of non-registrationNo principal employer of an establishment, to which this Act applies, shall-

(a) in the case of an establishment required to be registered under section 7, but which has not been registered within the time fixed for the purpose under that section;

(b) in the case of an establishment the registration in respect of which has been revoked under section 8,

employ contract labour in the establishment after the expiry of the period referred to in clause (a) or after the revocation of registration referred to in clause (b), as the case may be.


Section 10: Prohibition of employment of contract labour(�) Notwithstanding anything contained in this Act, the appropriate government may, af ter consultation with the Central Board or, as the case may be, a State Board, prohibit, by notification in the Official Gazette, employment of contract labour in any process, operation or other work in any establishment.

(2) Before issuing any notification under sub-section (�) in relation to an establishment, the appropriate government shall have regard to the conditions of work and benefits provided for the contract labour in that establishment and other relevant factors, such as-

(a) whether the process, operation or other work is incidental to, or necessary for the industry, trade, business, manufacture or occupation that is carried on in the establishment;

(b) whether it is of perennial nature, that is to say, it is of sufficient duration having regard to the nature of industry, trade, business, manufacture or occupation carried on in that establishment;

(c) whether it is done ordinarily through regular workmen in that establishment or an establishment similar thereto;

(d) whether it is sufficient to employ considerable number of whole-time workmen.

Explanation : If a question arises whether any process or operation or other work is of perennial nature, the decision of the appropriate government thereon shall be final.

Contract Labour (Regulation and Abolition) Act, 1970CHAPTER IV: LICENSING OF CONTRACTORS

Section 11: Appointment of licensing officersThe appropriate government may, by an order notified in the Official Gazette-

(a) appoint such person, being Gazetted Officers of government, as it thinks fit to be licensing officers for the purposes of this chapter; and

(b) define the limits, within which a licensing officer shall exercise the powers conferred on licensing officers by or under this Act.

Section 12: Licensing of contractors(�) With effect from such date as the appropriate government may, by notification in the Official Gazette, appoint no contractor to whom this Act applies, shall undertake or execute any work through contract labour except under and in accordance with a license issued in that behalf by the licensing officer.

(2) Subject to the provisions of this Act, a license under sub-section (�) may contain such conditions including, in particular, conditions as to hours of work, fixation of wages and other essential amenities in respect of contract labour as the appropriate government may deem fit to impose in accordance with the rules, if any, made under section 35 and shall be issued on payment of such fees and on the deposit of such sum, if any, as security for the due performance of the conditions as may be prescribed.

Section 13: Grant of licences(�) Every application for the grant of licence under sub-section (�) of section �2 shall be made in the prescribed form and shall contain the particulars regarding the location of the establishment, the nature of process, operation or work for which contract labour is to be employed and such other particulars as may be prescribed.


(2) The licensing officer may make such investigation in respect of the application received under sub-section (�) and in making any such investigation the licensing officer shall follow such procedure as may be prescribed.

(3) A license granted under this chapter shall be valid for the period specified therein and may be renewed from time to time for such period and on payment of such fees and on such conditions as may be prescribed.

Section 14: Revocation, suspension and amendment of licences(�) If the licensing officer is satisfied, either on a reference made to him in this behalf or otherwise, that-

(a) a license granted under section �2 has been obtained by misrepresentation or suppression of any material fact, or

(b) the holder of a license has, without reasonable cause, failed to comply with the conditions subject to which the license has been granted or has contravened any of the provisions of this Act or the rules made hereunder,

then without prejudice to any other penalty to which the holder of the license may be liable under this Act, the licensing officer may, after giving the holder of the license an opportunity of showing cause, revoke or suspend the license or forfeit the sum, if any, or any portion thereof deposited as security for the due performance of the conditions subject to which the license has been granted.

(2) Subject to any rules that may be made in this behalf, the licensing officer may vary or amend a license granted under section �2.

Section 15: Appeal(�) Any person aggrieved by an order made under section 7, section 8, section �2 or section �4 may, within thirty days from the date on which the order is communicated to him, prefer an appeal to an appellate officer who shall be a person nominated in this behalf by the appropriate government:

PROVIDED that the appellate officer may entertain the appeal after the expiry of the said period of thirty days, if he is satisfied that the appellant was prevented by sufficient cause from filing the appeal in time.

(2) On receipt of an appeal under sub-section (�), the appellate officer shall, after giving the appellant an opportunity of being heard dispose of the appeal as expeditiously as possible.

Contract Labour (Regulation and Abolition) Act, 1970CHAPTER V: WELFARE AND HEALTH OF CONTRACT LABOUR

Section 16: Canteens(�) The appropriate government may make rules requiring that in every establishment-

(a) to which this Act applies,

(b) wherein work requiring employment of contract labour is likely to continue for such period as may be prescribed, and

(c) wherein contract labour numbering one hundred or more is ordinarily employed by a contractor, one or more canteens shall be provided and maintained by the contractor for the use of such contract labour.

(2) Without prejudice to the generality of the foregoing power, such rules, may provide for-


(a) the date by which the canteens shall be provided;

(b) the number of canteens that shall be provided, and the standards in respect of construction, accommodation, furniture and other equipment of the canteens; and

(c) the foodstuffs which may be served therein and the charges which may be made therefore.

Section 17: Rest-rooms(�) In every place where in contract labour is required to halt at night in connection within the work of an establishment-

(a) to which this Act applies, and

(b) in which work requiring employment of contract labour is likely to continue for such period as may be prescribed,

there shall be provided and maintained by the contractor for the use of the contract labour such number of rest-rooms or such other suitable alternative accommodation with such time as may be prescribed.

(2) The rest-rooms or the alternative accommodation to be provided under subsection (�) shall be sufficiently lighted and ventilated and shall be maintained in clean and comfortable condition.

Section 18: Other facilitiesIt shall be the duty of every contractor employing contract labour in connection with the work of an establishment to which this Act applies, to provide and maintain-

(a) a sufficient supply of wholesome drinking-water for the contract labour at convenient places;

(b) a sufficient number of latrines and urinals of the prescribed types so situated as to be convenient and accessible to the contract labour in the establishment; and

(c) washing facilities.

Section 19: First-aid facilitiesThere shall be provided and maintained by the contractor so as to be readily accessible during all working hours a first-aid box equipped with the prescribed contents at every place where contract labour is employed by him.

Section 20: Liability of principal employer in certain cases(�) If any amenity required to be provided under section �6, section �7, section �8, or section �9 for the benefit of the contract labour employed in an establishment is not provided by the contractor within the time prescribed therefor, such amenity shall be provided by the principal employer within such time as may be prescribed.

(2) All expenses incurred by the principal employer in providing the amenity may be recovered by the principal employer from the contractor either by deduction from any amount payable to the contractor under any contract or as a debt payable by the contractor.

Section 21: Responsibility for payment of wages(�) A contractor shall be responsible for payment of wages to each worker employed by him as contract labour and such wages shall be paid before the expiry of such period as may be prescribed.

(2) Every principal employer shall nominate a representative duly authorised by him to be present at


the time of disbursement of wages by the contractor and it shall be the duty of such representative to certify the amounts paid as wages in such manner as may be prescribed.

(3) It shall be the duty of the contractor or ensure the disbursement of wages in the presence of the authorised representative of the principal employer.

(4) In case the contractor fails to make payment of wages within the prescribed period or makes short payment, then the principal employer shall be liable to make payment of wages in full or the unpaid balance due, as the case may be, to the contract labour employed by the contractor and recover the amount so paid from the contractor either by deduction from any amount payable to the contractor under any contract or as a debt payable by the contractor

Contract Labour (Regulation and Abolition) Act, 1970CHAPTER VI: PENALTIES AND PROCEDURE

Section 22: Obstructions(�) Whoever obstructs an inspector in the discharge of his duties under this Act or refuses or willfully neglects to afford the inspector any reasonable facility for making any inspection, examination, inquiry or investigation authorised by or under this Act in relation to an establishment to which, or a contractor to whom, this Act applies, shall be punishable with imprisonment for a term which may extend to three months, or with fine which may extend to five hundred rupees, or with both.

(2) Whoever willfully refuses to produce on the demand of an inspector any register or other document kept in pursuance of this Act or prevents or attempts to prevent or does anything which he has reason to believe is likely to prevent any person from appearing before or being examined by an inspector acting in pursuance of his duties under this Act, shall be punishable with imprisonment for a term which may extend to three months, or with a fine which may extend to five hundred rupees, or with both.

Section 23: Contravention of provisions regarding employment of contract labourWhoever contravenes any provision of this Act or of any rules made there under prohibiting, restricting or regulating the employment of contract labour, or contravenes any condition of a license granted under this Act, shall be punishable with imprisonment for a term which may extend to three months, or with fine which may extend to one thousand rupees, or with both, and in the case of a continuing contravention with an additional fine which may extend to one hundred rupees for every day during which such contravention continues after conviction for the first such contravention.

Section 24: Other offencesIf any person contravenes any of the provisions of this Act or of any rules made thereunder for which no other penalty is elsewhere provided, he shall be punishable with imprisonment for a term which may extend to three months, or with fine which may extend to one thousand rupees, or with both.

Section 25: Offences by companies(�) If the person committing an offence under this Act is a company, the company as well as every person in charge of, and responsible to, the company for the conduct of its business at the time of commission of the offence shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

PROVIDED that nothing contained in this sub-section shall render any such person liable to any punishment if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.


(2) Notwithstanding anything contained in sub-section (�), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or that the commission of the offence is attributable to any neglect on the part of any director, manager, managing agent or any other officer of the company, such director, manager, managing agent or such other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Explanation : For the purpose of this section-

(a) “company” means anybody corporate and includes a firm or other association of individuals; and

(b) “director”, in relation to a firm, means a partner in the firm.

Section 26: Cognizance of offencesNo court shall take cognizance of any offence under this Act except on a complaint made by, or with the previous sanction in writing of, the inspector and no court inferior to that of a Presidency Magistrate or a Magistrate of the first class shall try any offence punishable under this Act.

Section 27: Limitation of prosecutionsNo court shall take cognizance of an offence punishable under this Act unless the complaint thereof is made within three months from the date on which the alleged commission of the offence came to the knowledge of an inspector:

PROVIDED that where the offence consists of disobeying a written order made by an inspector, complaint thereof may be made within six months of the date on which the offence is alleged to have been committed.

Contract Labour (Regulation and Abolition) Act, 1970CHAPTER VII: MISCELLANEOUS

Section 28: Inspecting staff(�) The appropriate government may, by notification in the Official Gazette, appoint such persons as it thinks fit to be inspectors for the purposes of this Act, and define the local limits within which they shall exercise their powers under this Act.

(2) Subject to any rules made in this behalf, an inspector may, within the local limits for which he is appointed-

(a) enter, at all reasonable hours, with such assistance (if any), being persons in the service of the government or any local or other public authority as he thinks fit, any premises or place where contract labour is employed, for the purpose of examining any register or record or notice required to be kept or exhibited by or under this Act or rules made there under, and require the production thereof for inspection:

(b) examine any person whom he finds in any such premises or place and who, he has reasonable cause to believe, is a workman employed therein;

(c) require any person giving out work and any workman, to give any information, which is in his power to give with respect to the names and addresses of the person to, for and from whom the work is given out or received, and with respect to the payments to be made for the work;

(d) seize or take copies of such register, record of wages or notices or portions thereof as he may consider relevant in respect of an offence under this Act which he has reason to believe has been committed by the principal employer or contractor; and


(e) exercise such other powers as may be prescribed.

(3) Any information required to produce any document or thing or to give any information required by an inspector under sub-section (2) shall be deemed to be legally bound to do so within the meaning of section �75 and section �76 of the Indian Penal Code, �860 (45 of �860).

(4) The provisions of the Code of Criminal Procedure, �898 (5 of �898), shall, so far as may be, apply to any search or seizure under sub-section (2) as they apply to any search or seizure made under the authority of a warrant issued under section 98 of the said Code. 2

Section 29: Registers and other records to be maintained(�) Every principal employer and every contractor shall maintain such register and records giving such particulars of contract labour employed, the nature of work performed by the contract labour, the rate of wages paid to the contract labour and such other particulars in such form as may be prescribed.

(2) Every principal employer and every contractor shall keep exhibited in such manner as may be prescribed within the premises of the establishment where the contract labour is employed, notices in the prescribed form containing particulars about the hours of work, nature of duty and such other information as may be prescribed.

Section 30: Effect of laws and agreements inconsistent with this Act(�) The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law or in the terms of any agreement or contract of service, or in any standing orders applicable to the establishment whether made before or after the commencement of the Act:

PROVIDED that where under any such agreement, contract of service or standing orders the contract labour employed, in the establishment are entitled to benefits in respect of any matter which are more favourable to them than those to which they would be entitled under this Act, the contract labour shall continue to be entitled to the more favourable benefits in respect of that matter, notwithstanding that they received benefits in respect of other matters under this Act.

(2) Nothing contained in this Act shall be construed as precluding any such contract labour from entering into an agreement with the principal employer or the contractor, as the case may be, for granting them rights or privileges in respect of any matter which are more favourable to them than those to which they would be entitled under this Act.

Section 31: Power to exempt in special casesThe appropriate government may, in the case of an emergency, direct, by notification in the Official Gazette, that subject to such conditions and restrictions, if any, and for such period or periods, as may be specified in the notification, all or any of the provisions of this Act or the rules made thereunder shall not apply to any establishment or class of establishments or any class of contractors.

Section 32: Protection of action taken under this Act(�) No suit, prosecution or other legal proceedings shall lie against any registering officer, licensing officer or any other government servant or against any member of the Central Board or the State Board, as the case may be, for anything which is in good faith done or intended to be done in pursuance of this Act or any rule or order made thereunder.

(2) No suit or other legal proceeding shall lie against the government for any damage caused or likely to be caused by anything which is in good faith done or intended to be done in pursuance of this Act or any rule or order made there under.


Section 33: Power to give directionsThe Central Government may give directions to the Government of any State as to the carrying into execution in the State of the provisions contained in this Act.

Section 34: Power to remove difficultiesIf any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order published in the Official Gazette, make such provisions not inconsistent with the provisions of this Act, as appears to it to be necessary or expedient for removing the difficulty.

Section 35: Power to make rules(�) The appropriate government may, subject to the condition of previous publication, make rules for carrying out the purposes of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely-

(a) the number of persons to be appointed members representing various interests on the Central Board and the State Board, the term of their office and other conditions of service, the procedure to be followed in the discharge of their functions and the manner of filling vacancies;

(b) the times and places of the meetings of any committee constituted under that Act, the procedure to be followed at such meeting including the quorum necessary for the transaction of business, and the fees and allowances that may be paid to the members of a committee;

(c) the manner in which establishments may be registered under section 7, the levy of a fee therefor and the form of certificate of registration;

(d) the form of application of the grant or renewal of a licence under section �3 and the particulars it may contains;

(e) the manner in which an investigation is to be made in respect of an application for the grant of a licence and the matters to be taken into account in granting or refusing a licence;

(f) the form of a licence which may be granted or renewed under section �2 and the conditions subject to which the licence may be granted or renewed, the fees to be levied for the grant or renewal of a licence and the deposit of any sum as security for the performance of such conditions:

(g) the circumstances under which licences may be varied or amended under section �4;

(h) the form and manner in which appeals may be filed under section �5 and the procedure to be followed by appellate officers in disposing of the appeals;

(i) the time within which facilities required by this Act to be provided and maintained may be so provided by the contractor and in case of default on the part of the contractor, by the principal employer;

(j) the number and types of canteens, rest-rooms, latrines and urinals that should be provided and maintained;

(k) the type of equipment that should be provided in the first-aid boxes;


(l) the period within which wages payable to contract labour should be paid by the contractor under sub-section (�) of section 2�;

(m) the form of registers and records to be maintained by principal employers and contractors;

(n) the submission of returns, forms in which, and the authorities to which, such returns may be submitted;

(o) the collection of any information or statistics in relation to contract labour; and

(p) any other matter which has to be, or may be, prescribed under this Act.

(3) Every rule made by the Central Government under this Act shall be laid as soon as may be after it is made, before each House of Parliament while it is in session for a total period of thirty days which may be comprised in one session or in two successive sessions, and if before the expiry of the session in which it is so laid or the session immediately following, both Houses agree in making any modification in the rule or both Houses agree that the rule should not be made, the rule shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.


Annexure II

Workers Symposium on Policies and Regulations to Combat Precarious Employment

(Geneva, 4 – 7 October 2011)

CONCLUSIONS:Worldwide, unimaginable numbers of workers suffer from precarious, insecure, uncertain, and unpredictable working conditions. Unemployment figures alone are cause for concern, but even these fail to capture the larger majority of people who work, but who do not have a decent job, with a decent wage, a secure future, social protection, and access to rights. The universality and dimension of the problem call for coordinated and comprehensive action at the international level.

The global financial, economic and social crisis we are experiencing since 2007 has intensified these problems. Instead of drawing lessons from the crisis and changing a failed economic model, governments have allowed themselves to be governed by financial markets. Public sector employment is being slashed, workers rights have been further eroded, wages have been cut, and millions of additional workers have been pushed into precarious, temporary and insecure employment, with undeclared work on the rise in many countries

This symposium has allowed us to take stock of the development of precarious work worldwide and of its impacts on workers and their ability to exercise their right to associate and bargain collectively. Workers in precarious employment suffer from inferior working conditions in all aspects of work: security, predictability, health and safety, pay and benefits, and access to social security. The spread of precarious employment is part of what it is fair to call a worldwide corporate attack on the right to organize and bargain collectively, by shifting to subcontracting and individual contracts, attacking sectoral and national bargaining, and evading employer responsibilities by complicating what should in fact be a direct employment relationship with their workers.

Combating precarious work requires a comprehensive policy response that includes economic, fiscal and social policies geared towards full employment and income equality, a regulatory framework to reduce and ultimately eradicate precarious work, and greater efforts to empower workers by promoting the extension of collective bargaining and by ensuring that all workers can access and exercise their right to associate and to bargaining collectively freely and without fear. Minimum wages globally, basic income security through a universal social protection floor and policies to combat the erosion of the employment relationship are indispensable to limit precarious employment, indecent working and living conditions. Any credible plan of action would also have to address the specific conditions of migrant, women and young workers who are most affected by precarious work, and 2 should be informed by an analysis of how precarity among these workers amplifies the spread of precarity for all.

The ILO has a vital role to play in providing an appropriate and modern regulatory framework to stop the growing circumvention of labour and social protection through precarious employment arrangements. The ILO and the trade union movement should continue and strengthen their efforts to realize the ambition of the Employment Relationship Recommendation �98 that no contractual arrangements have the effect of depriving workers of the protection they are due. More efforts are needed to implement this Recommendation at the country level.

In the light of the concerns expressed with the rapid growth of triangular relationships through agency work there is also a need to examine the meaning, scope, impact and application of Convention �8�. Ratification and implementation of existing ILO Standards by governments would be a major contribution to reducing precarious employment. Changes in the global economy, in the world of work, in gender equality and family patterns also call for new regulatory initiatives to close regulatory gaps.


Legislative regulations need to be complemented by collective bargaining agreements where workers can directly negotiate and determine their conditions of work. Experience shows that without workplace empowerment through trade unions and collective representation, legal provisions and regulations often do not materialize in practice.

These collective bargaining rights must also be guaranteed for government employees. The transformation of many public sector jobs into precarious work through privatisation, outsourcing, or outright administrative wage cuts underline the urgent need for giving full right to public servants to bargain collectively for working conditions, wages and employment. Governments need to be exemplary as employers. Quality public services are essential to sustainable development and cannot be based on casual employment.

Organizing all groups of workers, and particularly reaching out to workers in informal and precarious employment, requires a wide spectrum of established and innovative forms of mobilizing and organizing workers. The trade union movement is better placed than any other organization to be the voice of all working people, and a powerful partner in alliances with other movements to create secure, stable and predictable working conditions for all workers.

At the ACTRAV Symposium, trade union and labour experts from around the world discussed options and possibilities to respond to these trends that deprive more and more workers from decent work.

A response should include:

�. Social and economic policies to combat precarious work

The ILO will work to develop a new economic paradigm in line with the global jobs pact and the four pillars of the decent work agenda, based on full employment and a wage-led recovery underpinned by social security and a social protection floor. Any plan to combat precarious work must be based on fundamental changes in social and economic policy.

2. Promotion of Collective Bargaining to reduce precarious work

The production of a Law and Practice Report and the holding of an ILO expert meeting on obstacles to collective bargaining for precarious workers by the ILO, such a report could inter alia address

The measures that should be taken to ensure that workers in triangular relationships can participate in meaningful collective bargaining.

Extending rights and working conditions provided to workers with recognised permanent employment relationships and collective bargaining arrangements to workers in precarious forms of employment

Provide safeguards against undermining collective barraging agreements and rights through the use of precarious work.

Collective bargaining in multi-employer workplaces and bargaining unit determination.

The mechanisms and measures to ensure the effective access of the right to collective bargaining for specific categories of workers whose status in law inhibits this access.

Obstacles to forming or joining trade unions for workers in triangular relationships;

The allocation of responsibilities between temporary work agencies and user enterprises.

Review of the criteria for determining an employer.

The effect of precarious working arrangements on health and safety.

Best practices to ensure coverage of precarious workers (extension mechanisms, etc.)

The promotion and reinforcement of central, national, regional and sectoral bargaining, including mechanisms for the legal extension of collective bargaining agreements.

3. Promotion of existing standards

Creation of a comprehensive package of relevant instruments to combat precarious work including core labour standards and:


C�22 on Employment Policies

Recommendation �98 on the Employment Relationship

C�58 on the Termination of Employment

C�54 on the Promotion of Collective Bargaining

C�75 on Part-Time Work

C�3� on Minimum Wage Fixing convention

C8� and C�29 on Labour Inspections

C94 on Labour Clauses in Public Contracts

Specific Categories

C97 and C�43 on Migrant Workers

C�56 on Workers with Family Responsibilities Convention

C�59 on Vocational Rehabilitation and Employment (Disabled Persons) Convention

C�83 on Maternity Protection

C�77 on Home Work

C�89 on Domestic Workers Convention, not yet in force as well as their accompanying recommendations.

4. Further regulation

New instruments should improve the predictability, stability and equality of employment conditions including equal pay for work of equal value for all workers. Regulations should ensure that exceptions from secure, opened and direct employment must be justified by valid reasons.

Temporary work

Limit, restrict and reduce the resort to precarious forms of employment

Establishing clear conditions under which an employer can hire temporary and agency workers

Limiting the proportion of workers at a given workplace on precarious contracts

Limiting the amount of time a worker can be on a temporary contract, after which they must be given a permanent contract.

Second, an instrument could seek to prevent the abusive use of precarious forms of employment by establishing clear criteria to determine the employment relationship building on the existing provisions of Recommendation �98.

The instrument should establish ef fective remedies for workers who are victims of abuse, to discourage such practices and encourage the allocation of joint and several liabilities in the case of multiple employers.

5. Capacity building

Upon request from the trade unions the ILO needs to provide its expertise and

technical assistance in order to enable trade unions to make full use of the ILO

Standards, the ILO Jurisprudence and its knowledge base of the organisation in their efforts to combat precarious employment.

There is a need for special efforts to work with trade unions to promote the above mentioned standards. This should include a special combined programme of the ILO technical department, the field offices, the Bureau for workers Activities and the

Turin Training Centre to develop and promote the necessary regulatory framework to put an end to precarious work.

Development by governments with the active support of the ILO of better statistical indicators to capture the reality of precarious employment


6. Union campaigns on precarious work

Make a priority of organizing precarious workers

Build alliances among trade unions and with social movements

Information campaigns for the population at-large

Through comprehensive International Framework agreements

To respond to the current offensive to make public sector work more precarious

To make a more active use of the OECD guidelines on multinationals and the

ILO Declaration on Multinationals

Develop observatories to monitor along with the ILO the development of precarious employment in each country and internationally

Use the ILO supervisory mechanism to create new jurisprudence on precarious work

Work towards the establishment of social protection floors, minimum wage levels that provide living wages, macroeconomic policies geared towards full employment, development friendly trade agreements, and re-regulation of financial markets

List of References�. Contract Labour and Judicial Interventions, Upadhyay Sanjay, V. V. Giri National Labour

Institute.

2. A Raw deal for contract labour, Singhvi Sanjay (www.labourfile.org CEC)

3. Contract Labour not a Master- Servant Relationship- SC- Times of India (Sept 2, 200�)

4. Pay Equal Wages to Contract Labour and Regular Workers: Group- Yahoo! India News (Sun, Oct. �0 yahoo.com/tnl.pay-equal-wages-to)

5. No end in sight to contract Labour debate, Maitrayee Handique- posted Mon. 3 2009- livemint.com articles.

6. Contract labour law: Convincing workers, employers key- The Economic Times 4th October 20�0 Amit Sen ET Bureau (www.indiatimes.com)

7. Contract Labour and The New Economic Policy- Is the Harmonisation possible- by Aparajita Tayal (Cited as 2004 July PL (Jour) �3 ebc.india.com/lawyer/articles)

8. Government seeks to amend contract labour law- The Economic Times Sept. 20�0, 04 Vikas Dhoot E T Bureau.

9. National Committee IFTU called All India General Strike on 20th August- Contributed cpimind- Tuesday �2 Aug. 2008

�0. Contract Labour Act in India- A paper with a pragmatic view by Meenakshi Rajeev (IGIDR Proceedings/ Project report series PP- 062-33 pdf)

��. Indian Industry Dependent on a forgotten workforce by Dibyendu Maiti, Institute of Economic Study- 20 July 2009 (www.ippg.org.uk/papers)

�2. Peoples Democracy volume xxxi no. �8- 4�st Indian Labour Conference.

�3. Submission to Chairman, Law Commission by Bharatiya Mazdoor Sangh dt. 4/3/20�0 on contract labour (R and A) Act �970.

�4. Contract Labour in India- DC Mathur

�5. Contract Labour in India- (labour.nic.in/dglw/session4�of ILC.doc)

�6. Contract Labour in India (labour.nic.in)

�7. Impact of liberalization on employment in India, Shastri R K, Tripathi Ravindra and Singh Anushree, International journal of vocational and Technical education volume II (3) PP 33-35 July 20�0 (www.academicjournals.org/ IJVTE)

�8. Conclusions of Workers Symposium on Policies and Regulations to Combat Precarious


Employment (Geneva, 4 – 7 October 20��)

�9. Contractual system and Indian Economy- some reflections from Trade Union point of view by Dr. Sharad Sawant, Advisor, Ambekar Institure for Labour studies.

20. On contract Labour Resolution passed by Bharatiya Mazdoor Sangh in �5th conference held in 2008 at cuttak, Orissa.

2�. Programme on contract Labour- Issues and problems- Jan. 27, 20�� Co-ordinator- Dr. Onkar Sharma – V.V. Giri National Labour Institute

22. Contractual system in production and Employment – A Possible Legislative frame work- by Suryakant Bagal, G.S. Maharashtra Council, Hind Mazdoor Sabha.

23. 43rd session of The Indian Labour conference, New Delhi.

24. Report of the Tripartite Group on contract Labour prepared by Directorate of Labour welfare, Ministry of labour and employment, New Delhi.

25. Contract Labour in south Asia- edited by D P A Naidu, ILO, Geneva.

26. CLRA Act is Divorced from Realities- Repeal or amend it by H.L. Kumar, Advocare – CLR June 2002-320

27. American Legislation for Regulating contract Labour – Engaged contractor on contractual work with the Federal Govt. by R.P. Siddhanti CLR Nov. 2004-38.

28. Internation Action – International Labour standards – International Labour conference 85th session �997.

29. Extract from Report of Tripartite Group on CL (RA) Act �970 dt. 30.�2.2009

30. Wage Inequality and job Insecurity among permanent and contract workers in India.. By Amit K. Bhandari and Almas Heshmati – university of Kalyani and Seoul National university.

3�. The Contract Labour (R&A) Act �970 issues and concerns (Estimates) by saini, Debi S. Indian journal of industrial Relations pub dt.7/0�/20�0.

32. Labour Laws – Recent Trends by S.N. Murthy, senior Advocate (email [email protected])

33. Labour and Labour Laws- India and ILO – 9th f.y.plan 97-02 para 4.�2


Annexure III

Interview Schedules and Checklist for FGDsQuestionnaire in respect of Contract Labour

�. What is your opinion about the existing CLRA Act?

2. On the basis of your experience whether this act is sufficient to deal with the objective of the

act?

3. Do you feel whether the provisions of this Act has Achieved the purpose for which it has

been enacted?

(on the background of the case of Stan Vac)

4. Do you feel that the workers are benefited by the provisions of this Act, insofar as, their

regulation of service conditions and getting permanent employment?

5. Do you feel that this act needs amendments so that the workers would have a right to agitate

their grievance before the judicial or quasi -judicial authority save and except high Court?

6. By your experience for the last several years in the field are you of the opinion that principle

employers comply with the provisions of the act and rules?

7. Whether the approach of the employers is to avoid the provisions and see that they are not

required to spend more money in statutory compliance and therefore the contractors are

appointed?

8. What is your definition of the term perennial nature of work and incidental thereto?

9. Do you feel that the trade unions or the workers are partly responsible for the present status

of the contract workers?

�0. In your experience in legal practice in how many cases you are aware that the contract

employees got the benefit of regularization by the procedure laid down by the act or by way

of agreement amongst the principle employer, contractor and contract workers. ��. What is your opinion about the function/non functioning about the government machinery

created under this act?�2. Can you tell the Boards appointed u/s 6 of the Act do really deliver the goods in dealing with

the cases of contract workers for regularization and or permancy.�3. Do you feel on the basis of your experiences;a. Whether the act is thoroughly useless deserving the repealment?b. Needs to be amended?c. Whether a separate enactment is necessary to deal with the problems?d. If you feel that i t needs proper amendments, what is your suggestion about the

amendments?�4. Are you of the opinion that the employers are benefited by this legislation and it has helped

the industry in its production and growth of wealth?�5. In your span of practice how many cases have you dealt with / come across with the issues

of contract labour regarding regularization and betterment of service conditions. �6. In how many cases there was an order rejecting the demand of the workers?�7. Have you attended functioning of the Board constituted under Sec. 6 of the Act where

normally the minister is the chairman?�8. Do you feel that the method adopted by the board to decide the issues on the basis of the

report of the office of the labour commissioner is sufficient?

Registered under Societies Act. (Reg. No. 6�8 Bom./82)Trust Act (Reg. No. F-7863 Bom./82)

80-G Certificate No. DIT(E)/ITO/(Tech)80G/�450/2009-�0(Valid from 0�.04.20�0)FCRA No. 083780667

Managing Committee Gopinath Munde : Chairman Prof. Bal Apte : Vice-Chairman Pratapbhai Ashar : Treasurer Chandrakant Patil : Secretary Devendra Fadanavis : Member Vijay (Bhai) Girkar : Member Mangalprabhat Lodha : Member Rekha Mahajan : Member Dr. Medha Naniwadekar : Member Arvind Rege : Member Rajesh Shah : Member Vinod Tawde : Member Adv. Chintaman Vanaga : Member Satish Velankar : Member

Functionaries Dr. Vinay Sahasrabuddhe : Director General Ravindra Sathe : Executive Director Dr. Aruna Kaulgud : Hon. Director, (CIBLS), Pune Madhav Bhandari : Hon. Director (Vilasrao Salunkhe Chair) Yashwant Thakar : Hon. Director (CDPR), Pune Sumeet Bhasin : Hon. Director (CLD), New Delhi Umesh More : Resident Sr. Executive Milind Betawadkar : Sr. Programme Officer

“ ….. a development strategy that, in the face of excess supply, seeks to keep the price of labour as low as possible, allows no room for collective action to reduce these people’s vulnerability and refuses to provide this footloose workforce with public representation. In short, the lack of registration, organization and protection does not have its origin in the free play of social forces, but it’s the deliberate product of economic interests that benefit from the state of informality in which a wide range of activities in all branches of the economy are kept, systematically and on a large scale, through evasion of labour laws and taxation.”

“Now with the neo-liberal economic policies there is the widespread informalization of the formal sector through down sizing, casualisation and contractualisation.”

(Excerpted from the document Unorganised Sector in India, prepared by Tomy Jacob of fedina.org)

Including the excluded : A study of the impact of contract labour

Education

sarva shramik sangh

bharatiya mazdoor sangh

sarva shramik sanghatana

hind mazdoor sabha

shriram industrial estate

indian labour conference

assistant labour commissioners

honble supreme court