The term contract labour is a relative term and for the principal employer (for whom he works) only he is a contract employee but for the contractor with whom the principal employer has contracted the employee engaged by him at the work place of the principal employer is his pay roll employee. It is between the contractor and the employee that the relationship is that of employer and employee. As such he is eligible to all benefits including Bonus and gratuity as if he is an employee under the rolls of the contractor. However, the principal employer is expected to ensure that the contractor's employee working in his plant is getting bonus as per the Bonus Act and if the contractor has not paid it, the principal employer can interfere and make the payment and recover it from the payments due to the contractor.
Madhu.T.K 11th December 2009 From India, Kannur