Rajanassociates
Legal Counsel
Balaji.venkatesan
Payroll, Statutory Compliance & General
RedStarGroup
Consultant
Raj Kumar Hansdah
Shrm, Od, Hrd, Pms
Rajanlawfirm
Legal Consultant
Varadan Sounder Rajan
Legal Consultant Hr Issues
BARAUNI2006
Human Resource
+13 Others

Dear All



By way of sharing knowledge in a series of Legal Compliance required for the Staffing Industry due to the coming into effect on 15-9-2010 of Industrial Disputes (Amendment) Act, 2010 (No. 24 of 2010) a Grievance Redressal Machinery has been introduced by insertion of Section 9 C .By this the following needs to be immediately done for Setting up of a Temps Grievance Redressal Machinery deputed to the Clients:

Setting up of Grievance Redressal Machinery

9C. (1) Every industrial establishment employing twenty or more workmen shall have one or more Grievance Redressal Committee for the resolution of disputes arising out of individual grievances.
(2) The Grievance Redressal Committee shall consist of equal number of members from the employer and the workmen.
(3) The chairperson of the Grievance Redressal Committee shall be selected from the employer and from among the workmen alternatively on rotation basis every year.
(4) The total number of members of the Grievance Redressal Committee shall not exceed more than six:
Provided that there shall be, as far as practicable one woman member if the Grievance Redressal Committee has two members and in case the number of members are more than two, the number of women members may be increased proportionately.
(5) Notwithstanding anything contained in this section, the setting up of Grievance Redressal Committee shall not affect the right of the workman to raise industrial dispute on the same matter under the provisions of this Act.
(6) The Grievance Redressal Committee may complete its proceedings within thirty days on receipt of a written application by or on behalf of the aggrieved party.
(7) The workman who is aggrieved of the decision of the Grievance Redressal Committee may prefer an appeal to the employer against the decision of Grievance Redressal Committee and the employer shall, within one month from the date of receipt of such appeal, dispose off the same and send a copy of his decision to the workman concerned.


A confusion may come into the mind of the Staffing Industry whether it will come within the definition of Industry For this Sec 2 (j) of the Industrial Disputes Act defines "industry" means any systematic activity carried on by co-operation between an employer and his workmen (whether such workmen are employed by such employer directly or by or through any agency, including a contractor) for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes (not being wants or wishes which are merely spiritual or religious in nature), whether or not, - (i) any capital has been invested for the purpose of carrying on such activity; or
(ii) such activity is carried on with a motive to make any gain or profit, and includes - (a) any activity of the Dock Labour Board established under section 5A of the Dock Workers (Regulation of Employment) Act, 1948 (9 of 1949);
(b) any activity relating to the promotion of sales or business or both carried on by an establishment, but does not include - (1) any agricultural operation except where such agricultural operation is carried on in an integrated manner with any other activity (being any such activity as is referred to in the foregoing provisions of this clause) and such other activity is the predominant one.
Explanation : For the purposes of this sub-clause, "agricultural operation" does not include any activity carried on in a plantation as defined in clause (f) of section 2 of the Plantations Labour Act, 1951 (69 of 1951); or
(2) hospitals or dispensaries; or
(3) educational, scientific, research or training institutions; or
(4) institutions owned or managed by organizations wholly or substantially engaged in any charitable, social or philanthropic service; or
(5) khadi or village industries; or
(6) any activity of the Government relatable to the sovereign functions of the Government including all the activities carried on by the departments of the Central Government dealing with defence research, atomic energy and space; or
(7) any domestic service; or
(8) any activity, being a profession practised by an individual or body of individuals, if the number of persons employed by the individuals or body of individuals in relation to such profession is less than ten; or
(9) any activity, being an activity carried on by a co-operative society or a club or any other like body of individuals, if the number of persons employed by the co-operative society, club or other like body of individuals in relation to such activity is less than ten;

Hence a separate Grievance Redressal Machinery for Temps needs to be set up with proper Legal advice.From the Clients side also they will need to ensure whether the Staffing Companies have such a redressal machinery in place.This would become a need of legal compliance.


We owe a special thanks to Mr Johann Pillai Director Regional [Asia -Pacific] Manpower Services India P Ltd a renowned expert in Indian Staffing Industry for inducting us into providing Legal advice for Staffing Industry for nearly 5 years which we continue to do .


With Regards



Advocates & Notaries -Legal Consultants-HR



E-mail : rajanassociates@eth,net,

Mobile : 9025792684.








From India, Bangalore

Dear All
We request to see https://www.citehr.com/285851-id-act...ne-update.html which gives the overall picture.
As we have just touched upon one aspect of the Amendment Setting up of Grievance Redressal Machinery in relation to the Indian Staffing Industry,we shall follow up with other aspects .
With Regards
Advocates & Notaries & Legal Consultants[HR]
E-mail : rajanassociates@eth,net,
Mobile : 9025792684-9025792634
.
From India, Bangalore
Dear All

Sub : Effect of the Amendment- Sec 2 A of the Act - Sub Section (2) & (3) Direct reference of Dispute.

Earlier the Temp could not approach a Labour Court without the assistance of a Labour Union. Now by the amendment he/she can approach the Labour court directly. This a drastic provision and will have a crippling effect on the Staffing Industry.

The remedy is:

1. First he/she has to make an application to the Labour Department Conciliation Officer.
2. If no action is taken by the Conciliation Officer then he/she can file an application to the Labour Court for adjudication of the Dispute.
3. Time limit for questioning all such disputes in relation to discharge, dismissal, termination or retrenchment is 3 years.

Issue for Staffing Industry:

1. Individual Employee grievance is subject to Conciliation by Labour Officer and thereafter by Labour Court.

2. Will open the floodgates of Employee Litigation.

Tips for avoidance:

1. Need to have a strong Internal redressal mechanism thereby closing all issues internally.
2. Take Notices from individual Temps and their Lawyers seriously and solve them immediately.
3. A pro-temp approach even without consulting the Principal employer [Client] needs to be taken.
4.A separate provision needs to be made out of the Staffing Company's funds to effect pro-active settlements.

With Regards

Advocates & Notaries & Legal Consultants for Staffing & Recruiting Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

Sub: Enhancement of wage ceiling by the ID Amendment Act

In continuation of the relevance of the recent ID Act amendments for the Staffing Industry we refer to the aspect Enhancement of wage ceiling by the ID Amendment Act.

Prior to the amendment Wage ceiling of workman in the definition clause Sec 2 (s) was Rs. 1600/- .Now it is enhanced to Rs. 10,000/- per month,.

Consequently any person working in any industry doing any manual, unskilled, skilled, technical, operational, clerical or supervisory work drawing wages up to Rs. 10000/- will be considered as a workman. Workman definition now reads like this:

(s) "workman" means any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute, but does not include any such person –
(i) who is subject to the Air Force Act, 1950 (45 of 1950), or the Army Act, 1950 (46 of 1950), or the Navy Act, 1957 (62 of 1957); or
(ii) who is employed in the police service or as an officer or other employee of a prison; or
(iii) who is employed mainly in a managerial or administrative capacity; or
(iv) who, being employed in a supervisory capacity, draws wages exceeding ten thousand 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.

The exclusion is where the workmen employed in a supervisory capacity, draws wages exceeding ten thousand 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.

In the Staffing Industry this change is conspicuous and Deputed Supervisors and real time Deputed Managers drawing wages exceeding ten thousand rupees per mensem alone may be exempted .All others will come within the definition of workmen for the purposes of any proceeding under the Industrial Disputes Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute.

With Regards

Advocates & Notaries & Legal Consultants for Staffing & Recruiting Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Can anyone share statutory checklist for doing Statutory Compliance Audit of Staffing companies.
From India, Mumbai
Dear All

Sub: Impact of changes in Appropriate Govt for disputes between Contractor and Contract Labour.

The impact of the Amendment on the definition of appropriate Govt has been clarified Accordingly Industry, corporation, PSEs and PSU owned or controlled by the Central Govt., for them appropriate Govt. would be Central Govt. and if such industry under the control of State Govt., appropriate Govt. would be State Govt. The amendment reads as follows:

Amendment of section 2

2. In the Industrial Disputes Act, 1947 (14 of 1947) (hereinafter referred to as the principal Act), in section 2,—

(i) in clause (a),––

(a) in sub-clause (i), for the words “major port, the Central Government, and”, the words “major port, any company in which not less than fifty-one per cent of the paid-up share capital is held by the Central Government, or any corporation, not being a corporation referred to in this clause, established by or under any law made by Parliament, or the Central public sector undertaking, subsidiary companies set up by the principal undertaking and autonomous bodies owned or controlled by the Central Government, the Central Government, and” shall be substituted;

(b) for sub-clause (ii), the following sub-clause shall be substituted, namely: -

“(ii) in relation to any other industrial dispute, including the State public sector undertaking, subsidiary companies set up by the principal undertaking and autonomous bodies owned or controlled by the State Government, the State Government:

Provided that in case of a dispute between a contractor and the contract labour employed through the contractor in any industrial establishment where such dispute first arose, the appropriate Government shall be the Central Government or the State Government, as the case may be, which has control over such industrial establishment.”;

Another important Amendment affecting the Staffing Industry and Contractors in general is inclusion of the following proviso :

Provided that in case of a dispute between a contractor and the contract labour employed through the contractor in any industrial establishment where such dispute first arose, the appropriate Government shall be the Central Government or the State Government, as the case may be, which has control over such industrial establishment.

The above proviso literally means that for the Employees of the Contractor of such Industries the concerned Government shall be the Central Government or the State Government, as the case may be, which has control over such industrial establishment. In case the Staffing Company is a Contractor for a central PSU then for the employees of the Contractor to raise a dispute will be the Central Govt and if deputed for a State PSU then it will be the State Govt.

With Regards

Advocates & Notaries & Legal Consultants for Staffing & Recruiting Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

Changes made in the Section 11 –Enforcing the Awards of Labour Court.

In section 11 of the principal Act, after sub-section eight , the following sub-sections shall be inserted, namely:

“(9) Every award made, order issued or settlement arrived at by or before Labour Court or Tribunal or National Tribunal shall be executed in accordance with the procedure laid down for execution of orders and decree of a Civil Court under order 21 of the Code of Civil Procedure, 1908

(10) The Labour Court or Tribunal or National Tribunal, as the case may be, shall transmit any award, order or settlement to a Civil Court having jurisdiction and such Civil Court shall execute the award, order or settlement as if it were a decree passed by it.”

By introduction of the provision the award of Labour Court / Tribunals is now additionally executable by a Civil Court. After the Labour Court/Tribunal passes the award it shall be transmitted to the Civil Court for execution. By this process both the moveable and immovable property of the Judgment Debtor i.e. the person/company against whom the award is passed can be attached. Also the Judgment Debtor can be arrested and put in prison. Earlier the awards were executed by the Revenue Recovery process alone.

With Regards

Legal Consultants for Staffing & Recruiting Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
STATUTORY COMPLIANCE MOST RELEVANT TO STAFFING INDUSTRY

Labour Welfare Fund ACT Statement of Contribution along with cheque to be submitted to the Authority Concerned.

The Profession Tax ACT Monthly Returns along with cheque.

The Contract Labour (R&A) ACT, 1970 Half Yearly Return - by Contractor to be submitted to Asst. Labour Commissioner

The Maternity Benefit ACT, 1961 Annual Return

The (National & Festival Holidays) ACT, 1963 Annual Return.

The Minimum Wages ACT, 1948 Annual Return

The Contract Labour (R&A) ACT, 1970 Annual Return by Principal Employer.

The Payment of Wages ACT, 1936 Annual Return

The Employees Provident Fund ACT, 1952 3A & 6A Annual Individual Returns & Returns of Contributions to the Regional Provident Fund Commissioner.

The Employees State Insurance ACT, 1948 Summary of Contribution

The Contract Labour (R&A) ACT, 1970 Renewal of Licence .

The Payment of Bonus ACT, 1965 Annual Return

Shops & Establishment Act Renewal & Registration Certificate.

With Regards

Advocates & Notaries & Legal Consultants for Staffing & Recruiting Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Sub: Dealing with Temporary Employees Absconding cases in the Staffing Industry

Dear All

In the Staffing Industry one can find several instances of the Temporary Staff Absconding. In such cases the Temps need to be terminated so that the F & F is done and the name removed from Pay rolling records.

Securing this process is a challenge for the HR Managers of staffing Business .

The process will be dependent on each of the Staffing Company HR practice and needs of the Client.

There is a practice in the Staffing Industry that until the Client gives the “No dues “the F & F cannot be done .Therefore the Termination practice has to be sync with that.

Staffing Companies have to have a secure Legal Department or avail Expert Legal advice on Severance and Termination practices tailor made for their needs which in the long run will be a security for the Staffing Industry to avoid post termination claims by the Temporary Employees which will eat away the slender margins earned from the Client .

With Regards

Advocates & Notaries & Legal Consultants for Staffing & Recruiting Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

Sub: Severance of Employment - Temporary Employee of Staffing Companies

It is an essence Of Business of the Contract Staffing Industry to place their Temporary Employees with the Client to render Services. Ninety percent of such placements are supervised by the Client (This of course is a debatable issue and we are not dealing with that in this post).Pay rolling of the Temporary Employee will be done month after month on the basis of the attendance received from Client.

Suddenly the Staffing Company will find that they are not receiving the attendance of a particular Temporary Employee or a Group of such Employees .When enquiry is made with the Client they will just abruptly say “We asked him to stop coming” without intimating the Staffing Company or getting their prior approval or by asking the Staffing Company to issue a proper Termination letter .What this legally means for the Staffing Company?

The answer is that there is no proper severance of the Employment of the Temporary Employee .Staffing Companies need to tell their Client in plain terms that such practice is not legal and their action inadvertently will create threats for demand of back-wages and re-instatement form such Temporary Staff orally terminated by them.

In many cases the time lag for receiving such claims will be delayed say by 2-6 months and a Temporary Employee not finding an alternate Job or working in the unorganized sector can always threaten to sue or sue the Staffing Company for not terminating the Employment as he is the employee of the Staffing Company and not the Client. Such a claim made is to be construed as legal and valid as the Staffing Company has not caused proper termination in accordance with the terms of Employment.

The need for the Staffing Industry being diligent and careful in dealing with such issues arises as otherwise they would be coughing up several thousand of Rupees for back wages or go in for an out of Court settlement. They should secure the process of Termination/Severance in all such cases by evolving a Safe and Secure Severance Practice (Triple S Practice) which should have the approval of the Client so that the Triple S practice of the Staffing Company is transparent and ensures risk coverage.

With Regards

Advocates & Notaries & Legal Consultants for Recruiting & Staffing Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

Sub: Gratuity payment

Please note that Contract Labour are entitled for gratuity as per the decision of HIGH COURT OF JUDICATURE AT MADRAS DATED: 20.11.2006 The Honourable Mr.Justice P.D.DINAKARAN and The Honourable Mr.Justice P.P.S.JANARTHANA RAJA. in the case of The Management of Cruickshank & Company Ltd.vs The Appellate Authority under Payment of Gratuity Act, 1992and Regional Labour Commissioner (Central), Shastri Bhavan, Chennai.The Court held :

"The entitlement of contract labourers for gratuity cannot be dislodged or denied on account of tussle between the principal employer, who engaged the service of the contract labourers and the contractor, who employed the contract labourers;"

The Court went to further say:

....the gratuity claimed by the claimants herein being a welfare benefit created and payable by operation of law under the provisions of the Payment of Gratuity Act which are included under clause(d) of Section 2(vi) of the Payment of Wages Act within the meaning of wages payable to the contract labourers, it would be the basic responsibility of the petitioner *(ie the Principal Employer ) to make payment of gratuity to the claimants in full or in part as per Section 21(4) of the Contract Labour Act, of course, without prejudice to the right of the petitioner *(ie the Principal Employer ) to recover the same from the third respondent, contractor, even though the initial responsibility to make such payment of gratuity lies with the third respondent, contractor, as the welfare legislations such as

(i) Payment of Wages Act, 1936;
(ii) Contract Labour (Regulation and Abolition) Act, 1970; and
(iii) Payment of Gratuity Act, 1972,

are to be interpreted liberally and in widest possible construction in favour of the labourers, the claimants herein. Therefore, for deciding whether the wages payable to the claimants includes gratuity within the meaning of Contract Labour Act, 1970, whereunder the definition of wages is traceable to the definition of wages in the Payment of Wages Act, 1936 and the centrifugal issue whether the gratuity payable under the Payment of Gratuity Act is protected under Section 2(vi)(d) of the Payment of Wages Act, 1936, in spite of exclusion under sub-clause (6) of Section 2(vi) of the Payment of Wages Act, 1936, we are constrained, as a rule of interpretation, to refer the object and reasons of the legislative intention of all the three statutes, referred to above and the scope and ambit of the provisions contained thereunder and are satisfied that the gratuity being a benefit created and payable by operation of law under the provisions of the Payment of Gratuity Act, 1972, is protected within the definition of wages for having included under clause (d) of Section 2(vi) of the Payment of Wages Act, 1936. Therefore, the Court has to give full effect to the legal/statutory fiction and such fiction has to be carried to its logical conclusions, as any other view would only frustrate the legislative intention of all the enactments."....

*Added by us for explanation

By virtue of this Judgment employees of the Contractor deployed at the place of Principal Employer who become entitled for gratuity as per the Payment of Gratuity Act are to be settled gratuity on their severance.In case the Contractor fails to settle it the Employees can make a claim on the Principal Employer who needs to settle it and becomes liable and thereafter recover it from the Contractor.

Further details of the Judgment can be provided on request.

With Regards

Advocates & Notaries & Legal Consultants for Recruiting & Staffing Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

Deduction in Salary

In the Staffing Industry you will have requests from the Client from time to time wanting deduction of certain amounts from the Temporary Employees Salary . The Consultant handling the Client has to ensure that deduction from the Salary falls within Sec 7 of the Payment of Wages Act which provides:

Sec 7. Deductions which may be made from wages

(1) Notwithstanding the provisions of sub-section (2) of section 47 of the Indian Railways Act 1890 (9 of 1890) the wages of an employed person shall be paid to him without deductions of any kind except those authorised by or under this Act.

Explanation I : Every payment made by the employed person to the employer or his agent shall for the purposes of this Act be deemed to be a deduction from wages.

Explanation II : Any loss of wages resulting from the imposition, for good and sufficient cause upon a person employed of any of the following penalties namely :-

(i) the withholding of increment or promotion (including the stoppage of increment at an efficiency bar);

(ii) the reduction to a lower post or time scale or to a lower stage in a time scale; or

(iii) suspension;

shall not be deemed to be a deduction from wages in any case where the rules framed by the employer for the imposition of any such penalty are in conformity with the requirements if any which may be specified in this behalf by the State Government by notification in the Official Gazette.

(2) Deductions from the wages of an employed person shall be made only in accordance with the provisions of this Act and may be of the following kinds only namely :

(a) fines;

(b) deductions for absence from duty;

(c) deductions for damage to or loss of goods expressly entrusted to the employed person for custody or for loss of money for which he is required to account where such damage or loss is directly attributable to his neglect or default;

(d) deductions for house-accommodation supplied by the employer or by government or any housing board set up under any law for the time being in force (whether the government or the board is the employer or not) or any other authority engaged in the business of subsidising house-accommodation which may be specified in this behalf by the State Government by notification in the Official Gazette;

(e) deductions for such amenities services supplied by the employer as the State Government or any officer specified by it in this behalf may by general or special order authorise.

Explanation : The word "services" in this clause does not include the supply of tools and raw materials required for the purposes of employment;

(f) deductions for recovery of advances of whatever nature (including advances for travelling allowance or conveyance allowance) and the interest due in respect thereof or for adjustment of over-payments of wages;

(ff) deductions for recovery of loans made from any fund constituted for the welfare of labour in accordance with the rules approved by the State Government and the interest due in respect thereof;

(fff) deductions for recovery of loans granted for house-building or other purposes approved by the State Government and the interest due in respect thereof;

(g) deductions of income-tax payable by the employed person;

(h) deductions required to be made by order of a court or other authority competent to make such order;

(i) deductions for subscriptions to and for repayment of advances from any provident fund to which the Provident Funds Act 1952 (19 of 1952) applies or any recognised provident funds as defined in section 58A of the Indian Income Tax Act 1922 (11 of 1922) or any provident fund approved in this behalf by the State Government during the continuance of such approval;

(j) deductions for payments to co-operative societies approved by the State Government or any officer specified by it in this behalf or to a scheme of insurance maintained by the Indian Post Office and

(k) deductions made with the written authorisation of the person employed for payment of any premium on his life insurance policy to the Life Insurance Corporation Act of India established under the Life Insurance Corporation 1956 (31 of 1956) or for the purchase of securities of the Government of India or of any State Government or for being deposited in any Post Office Saving Bank in furtherance of any savings scheme of any such government.

(kk) deductions made with the written authorisation of the employed person for the payment of his contribution to any fund constituted by the employer or a trade union registered under the Trade Union act 1926 (16 of 1926) for the welfare of the employed persons or the members of their families or both and approved by the State Government or any officer specified by it in this behalf during the continuance of such approval;

(kkk) deductions made with the written authorisation of the employed person for payment of the fees payable by him for the membership of any trade union registered under the Trade Union Act 1926 (16 of 1926);

(l) deductions for payment of insurance premia on Fidelity Guarantee Bonds;

(m) deductions for recovery of losses sustained by a railway administration on account of acceptance by the employed person of counterfeit or base coins or mutilated or forged currency notes;

(n) deductions for recovery of losses sustained by a railway administration on account of the failure of the employed person to invoice to bill to collect or to account for the appropriate charges due to that administration whether in respect of fares freight demurrage wharfage and cranage or in respect of sale of food in catering establishments or in respect of sale of commodities in grain shops or otherwise;

(o) deductions for recovery of losses sustained by a railway administration on account of any rebates or refunds incorrectly granted by the employed person where such loss is directly attributable to his neglect or default;

(p) deductions made with the written authorisation of the employed person for contribution to the Prime Minister's National Relief Fund or to such other Fund as the Central Government may by notification in the Official Gazette specify;

(q) deductions for contributions to any insurance scheme framed by the Central Government for the benefit of its employees.

(3) Notwithstanding anything contained in this Act the total amount of deductions which may be made under sub-section (2) in any wage-period from the wages of any employed person shall not exceed -

(i) in cases where such deductions are wholly or partly made for payments to co-operative societies under clause (j) of sub-section (2) seventy-five per cent of such wages and

(ii) in any other case fifty per cent of such wages :

Provided that where the total deductions authorised under sub-section (2) exceed seventy five per cent or as the case may be, fifty per cent of the wages the excess may be recovered in such manner as may be prescribed.

(4) Nothing contained in this section shall be construed as precluding the employer from recovering from the wages of the employed person or otherwise any amount payable by such person under any law for the time being in force other than the Indian Railways Act 1890 (9 of 1890).

In case the deduction falls within the above the Consultant can authorise deduction and simultaneously obtain a Salary Adjustment Letter from the Temporary Employee .Thereafter the deduction can be done or else the penal provisions of the Payment of Wages Act can operate if the deduction is done arbitrarily.

With Regards

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684.
From India, Bangalore
Subject - Unpaid Salaries & Gratuity Payment - Statutory Compliance

In the Staffing Industry all unpaid Salaries/Dues and Gratuity ( in accordance with the Payment of Gratuity Act ) are payable even without demand. It is the Temporary Employee’s legal entitlement and not gratis which all may note.

Unpaid Salaries ie dues and Gratuity is covered by Sec 2 (10) of THE BOMBAY LABOUR WELFARE FUND ACT,1953 by way of illustration:

"unpaid accumulation" means all payments due to the employees but not made to them within a period of three years from the date on which they became due whether before or after the commencement of this Act including the wages, and gratuity legally payable but not including the amount of contribution, if any, paid by an employer to a provident fund established under the Employees' Provident Funds Act, 1952 (XIV of 1952);

In accordance with Sec 3 constituting Welfare Fund

(1)The Administrator shall constitute a fund called the Labour Welfare Fund, and notwithstanding anything contained in any other law for the time being in force or in any contract or instrument; all unpaid accumulations shall be paid at such intervals as may be prescribed to the Board, which shall keep a separate account therefor until claims thereto have been decided in the manner provided in section 6A, and the other sums specified in sub-section (2) shall be paid into the Fund.

(2)The Fund shall consist of-

(a)all fines realized from the employees;

(b)unpaid accumulations transferred to the Fund under section 6A;

Sec 7 A deals with Unpaid accumulations and claims thereto:

(1)All unpaid accumulations shall be deemed to be abandoned property.

(2) Any unpaid accumulations paid to the Board in accordance with the provision of section 3 shall on such payment, discharge an employer of the liability to make payment to an employee in respect thereof but to the extent only or the amount paid to the Board, and the liability to make payment to the employee to the extent aforesaid shall subject to the succeeding provisions of this section be deemed to be transferred to the Board

Similarly each State have their own Welfare Fund which would be relevant for that particular Staffing Company .

The impression that when a person is terminated, resigns or absconds or severance taking place or does not claim his dues the Employer can appropriate the amounts due the Employee is not the correct approach. These are in the nature of their entitlement. What the Employer in the maximum deducts is notice pay if proper notice is not given. That too in the Staffing Industry enforcing the Notice period is an issue.

Just because the Employment market is vibrant and volatile as the Temporary Employees easily find an alternate job they may appear not to be bothered of their past entitlements. Staffing Companies by way of ethics cannot be expected to take advantage of the situation.

Please note it is the Temporary Employees money which is in the Staffing Companies hands. Such amounts must be immediately transferred to unpaid Salaries Account and after three years deposited with the Welfare Fund.

The above is an essence of statutory compliance and what is not the Staffing Companies money but the Temps cannot be retained or sought to be illegally enriched. Compliance Team /Auditors need to monitor this closely.

With Regards

Advocates & Notaries & Legal Consultants for Staffing & Recruiting Industry

-9025792684-9025792634
From India, Bangalore
Subject - Andhra Pradesh contract labour act 2003 amendment

The State amendment of Andhra Pradesh in 2003 which introduced a clause restraining the employment of Contract Labour in core activities of any establishment if the same was prohibited by Notification .But it introduced the following exemptions.

[a]. The normal functioning of the establishments is such that the activity is ordinarily done through contractors; or
[b]. The activities are such that they do not require full time workers for the major portion of the working hours in a day or for longer periods, as the case may be;
[c] Any sudden increase of volume of work in the core activity which needs to be accomplished in a specified time"

Also the Andhra Pradesh Amendment introduced a definition clause for "core activities" of an establishment meaning as any activity for which establishment is set up which includes any activity which is essential or necessary to the core activity and it again provides certain exceptions which are follows:-

1]. Sanitation works, including sweeping, cleaning, dusting and collection and disposal of all kinds of waste;
2]. Watch and ward services including security service;
3]. Canteen and catering services;
4]. Loading and unloading operations;
5]. Running of hospitals, educational and training institutions, guest houses, clubs and the like where they are in the nature of support services of an establishment;
6]. Courier services which are in nature of support services of an establishment;
7]. Civil and other constructional works, including maintenance;
8]. Gardening and maintenance of lawns, etc;
9]. Housekeeping and laundry services, etc., where they are in nature
support services of an establishment;
10]. Transport services including ambulance services;
11]. Any activity of intermittent in nature even if that constitutes a
core activity of an establishment; and
12]. Any other activity which is incidental to the core activity.

Also a rider was introduced by the Andhra Pradesh Amendment that the above 12 activities by themselves should not be the core activities of such establishment.

It must be noticed that the Andhra Pradesh Amendment has force only in Andhra Pradesh State and not in the rest of the Country and this was the first step initiated by a State Govt to put India on the path of globalization.

With Regards

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684.
From India, Bangalore
Absence From duty

The Bombay Shops and Establishments Act Sec 66 proviso (a) says that notice of termination is not required under Sec 66 if an employee absents from service without notice in writing or without sufficient reasons for seven days or more which can be construed as misconduct .

Consequently the severance of the Temporary Employee for absence from duty has to be in tune with the legal requirement. Though the legal provision says that termination is possible without notice. It may not be a practical solution when in the Staffing Industry when one is dealing with large numbers .Documenting the absence is a legal compliance issue. The need for issuing a call letter requiring the employee to report for the job is the first step. This can be followed by the termination letter . But a synthesis of combining both may require legal acumen and be a perfect solution for fast tracking the legal compliance on this aspect.

With Regards

Advocates & Notaries & Legal Consultants for Staffing & Recruiting Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

The portion of Maharashtra Govt Draft Labour Policy 2010 on Contract Labour is very impressive which reads like this:

Contract Labour

The issue of contract labour is one on which employers and unions are strongly divided. Employers see contract labour as an essential component of labour market flexibility that will contribute to economic efficiency and competitiveness. Trade unions see contract labour as a form of exploitation and a means to deny workers permanent jobs.

Contract labour must be distinguished from outsourcing of tasks to particular entities for cleaning and security services, computer technology expertise, and consultancy services. These are commercial contracts for service as between the user and service-provider and fall outside the scope of labour legislation. The provider-entity, however, is an employer and thus is required to comply with all appropriate labour laws.

Out-sourcing and commercial contracts are not the real issue. The real issue is the employment of labour, under contract, for specific durations or specific tasks as a means of cost-cutting, or to provide flexibility, or as a substitute for jobs that would normally be regular and permanent.

The Department of Labour proposes to facilitate discussions with the social partners on the issue of contract labour with a view to deciding on a model that provides both fairness and flexibility. This may involve some discussion on possible amendments of existing laws as, for example, preventing employers from using lower-cost contract labour as a substitute for permanent workers, and by paying a loading to contract workers to compensate for their loss of benefits including leave and access to social security. It might also consider whether the current system of contracting agents as the employers of contract workers, as distinct from the direct employment of such workers by the principal employer, is in the best interests of works and employers.

The productivity of contract workers is also an issue for tripartite discussions.The Department of Labour, through discussions with social partners as mentioned above, would like to evolve models and/or structures through which a win-win situation can be developed, both for the employers and the workers in a globalized scenario. The win-win situation could be developed if the employer is given flexibility to engage labour and the labour is ensured protection of rights. One such proposal could also be to engage contract labour with a loading factor as a premium for flexibility.

It is also suggested that in order to develop a long term solution on contract labour and develop models to meet the twin concerns of flexibility to industry and fairness to labour, it may be necessary to go through a transition phase in which, the first step could be to study the present labour laws and their actual implementation to identify on what is incentivising contract labour and disguised employment? It would also be necessary to define fairness in terms of “equal treatment”. What is “equal treatment” would also have to be agreed upon more specifically between all social partners in a clear-cut manner.

Further, there would be need to work out solutions along with changes in law if required, which would further the objective to reach towards the end goal of increased productivity in a situation of ‘flexibility’ and ‘fairness’ as defined by ‘equal treatment’.

We are optimistic to see how far the above is translated into Law.

With Regards

Advocates & Notaries & Legal Consultants[HR]

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All
By way of refurbishing HR Knowledge for the Staffing Industry we have attached the historic ESI Circular which in effect had recognized Outsourcing as a legal practice in India .
With Regards
Advocates & Notaries & Legal Consultants
E-mail : rajanassociates@eth,net,
-9025792684-9025792634
From India, Bangalore

Attached Files
Membership is required for download. Create An Account First
File Type: doc -VSRA-ESI circular on outsourcing[1].doc (82.0 KB, 288 views)

Dear All
In order to place the valuable material on the trends in Labour Law from 1960 to 1999 MR C Niranjan Rao Advocate has placed a valuable post in CTE HR Legal Issue trail and to view it please see the link https://www.citehr.com/294538-recent...#axzz152qqfpnY
With Regards
Advocates & Notaries & Legal Consultants for Recruiting & Staffing Industry
E-mail : rajanassociates@eth,net,
-9025792684-9025792634
From India, Bangalore
Dear All

Sub: Statistics of Enforcement of Labour Laws by the Central Govt:

The enforcement of the provisions of various Labour laws has been prescribed under provisions of the relevant Acts and is secured through the officers of the Central Industrial Relations Machinery (CIRM) in the Central Sphere, and through the State enforcement machinery in the State Sphere. Some of the labour enactments are also enforced by the Employees State Insurance Corporation and Employees Provident Fund Organization.

The information regarding inspections conducted, prosecutions launched, claim case filed and decided and amount awarded under Minimum Wages Act and Payment of Bonus Act in Central Sphere is found in the Attachment.



In regard to Employees Provident Fund, over 80 complaints alleging Provident Fund evasion had been received during 2007-2010 by Vigilance Wing of Employees Provident Fund Organisation.

Shri Harish Rawat, Minister of Labour and Employment gave this information in reply to a question in the Lok Sabha .

The above data will give a picture on the realistic Enforcement scenario in respect of these two enactments .

Presently the level playing field available for the Indian Staffing Industry to operate in the present liberalised regime of the Central Government is quite adequate and is commendable and will be an invitation to International Staffing Companies to open shop in India

With Regards

Advocates & Notaries & Legal Consultants for Recruiting & Staffing Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore

Attached Files
Membership is required for download. Create An Account First
File Type: doc Statistics on violations Minimum Wages-Bonus Act.doc (35.0 KB, 278 views)

Subject - NO EPF Contribution on Leave encashment

Dear All

In decision of the Madras High Court of Mr Justice K.Chandru in the case of Thiru Arooran Sugars Ltd. And Five Ors. vs Asstt. Provident Fund Commissioner (Enf) Employees' Provident Funds Organisation And Anr *decided on 12/10/2007 wherein it was the stand of the respondent/PF Department that the leave encashment given to the workman is covered by the term of basic wages. In support of their stand, they were relying upon the judgment of the Bombay High Court as well as the Karnataka High Court and claimed all the petitioners/managements were bound to make contribution in terms of the leave encashment given to the workman as part of the basic wages.

But the Court rejected the contention of the Department and held

"If the two decisions of the Supreme Court in Bridge & Roof Company (India) Ltd's case (supra) as well as TI Cycles of India's case (supra) read together, there will be no difficulty in arriving at the conclusion that the basic wage was never intended to include in the leave with wages for which encashment is allowed. The term basic wage which includes all emoluments which are earned by an employee while on duty or on leave or on holidays with wages. In accordance with the terms of the contract of employment, it cannot mean it can only mean the weekly holidays, national festival holidays. In many cases, the employees do not take leave and encash it only at the time of retirement or as legal heirs at the time of his death, which is an uncertain contingency. Even though the employer made annual provisions for such contingency unless the contingency of encashing of leave takes place, the question of the actual payment to the workmen never takes place. In case, he avails the entire leave, during his tenure, then the question of payment of any contribution may not arise. Any payment of contribution cannot be based upon different contingencies and uncertainties.

Finally the Court precluded the Department from claiming Contribution on Leave Encashment and further held :

"By allowing the deduction on the encashment of annual leave, in no way, the employees are benefited and at the time of death or retirement or resignation, a lump-sum amount in his hand will give him a greater relief because at that time only, he is receiving the entire PF contributions standing to his credit also."

In the Staffing Industry in case Client permits Leave Encashment then application of the essence of the decision will become relevant.

With Regards

Advocates & Notaries & Legal Consultants for Recruiting & Staffing Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Sub:CLRA Mutual rights and Duties

Dear All

In fact many of the Clients of the Staffing Industry insist Compliance of Contract Labour (Abolition & Regulation ) Act 1970 [CLRA] . The Clients without understanding the implications of CLRA and the Industry reciprocating it just for the sake of getting the Business undertake its compliance without understanding that Compliance of CLRA is not a one way route.It involves mutual duties and responsibilities.

It is the basic rule of CLRA compliance that the Contractor cannot get a licence without registration by the Principal Employer. Therefore one needs two hands to clap.

The relevant provisions for beginning the Compliance under CLRA are:

The Principal Employer needs to do the following :

7. Registration of certain establishments.-

(1) 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 establishments 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 satified 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.

8. Revocation of registration in certain cases.- If 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.

9. Effect of non- registration.- No 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.

Application has to be made in Form I and Certificate will be issued in Form II

The Contractor is required to do the following :

12. Licensing of contractors.-

(1) 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 licence issued in that behalf by the licensing officer.

(2) Subject to the provisions of this Act, a licence under sub- section (1) 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.

13. Grant of licences.-

(1) Every application for the grant of a licence under sub- section (1) of section 12 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 (1) and in making any such investigation the licensing officer shall follow such procedure as may be prescribed.

(3) A licence 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.

14. Revocation, suspension and amendment of licences.-

(1) If the licensing officer is satisfied, either on a reference made to him in this behalf or otherwise, that--

(a) a licence granted under section 12 has been obtained by misrepresentation or suppression of any material fact, or

(b) the holder of a licence has, without reasonable cause, failed to comply with the conditions subject to which the licence has been granted or has contravened any of the provisions of this Act or the rules made thereunder, then, without prejudice to any other penalty to which the holder of the licence may be liable under this Act, the licensing officer may, after giving

the holder of the licence an opportunity of showing cause, revoke or suspend the licence or forfeit the sum, if any, or any portion thereof deposited as security for the due performance of the conditions subject to which the licence has been granted.

(2) Subject to any rules that may be made in this behalf, the licensing officer may vary or amend a licence granted under section 12.

Application is to be made under Form IV and the Licence will be issued under Form VI .

Next time when you undertake Compliance of CLRA the Industry needs to tell the Client of mutual duties and responsibilities.

With Regards

Advocates & Notaries -Legal Consultants-HR

E-mail : rajanassociates@eth,net,

Mobile : 9025792684.
From India, Bangalore
Subject - Insubordination in Temping Industry

Dear All

Insubordination which is a major issue to be tackled in HR in the Temping and Staffing Industry.

Clients come up with reports of Insubordination by the Temps .

On such a report coming from the Client the Temping Company has to see that such Insubordination needs to be proved and it should be wilful.

In service matters it would include an act of revolt against superior; a challenge to the authority of superior, an agitation against the superior, any act which humiliates, insults or degrades the dignity and decorum of superior's authority, words which deliberately cast a slur or stigma on the superior, language employed to denigrate the superior, condemnation which demoralizes and shatters the public confidence, an act or use of expression which pollutes and militates against loyalty, an unbecoming gesture without words and like matters; what constitutes insubordination depends on facts and circumstances of each case. The offender may not realize the consequences, therefore examination from his angle would be irrelevant. How it is received by the other side, what is the reflection on the administration and discipline of the office would be very relevant. Ref B.M. Baliga vs Vijaya Bank decided on 11 July, 1990 by Karnataka High Court ILR 1991 KAR 4361, 1991 (4) KarLJ 721-

On a report of Insubordination coming the follow up action can be by issuing a warning letter recording the Insubordination. But its language should be so structured that the factum of Direct supervision by the Client should be stated in a couched language.This would be a part of the large process that the Temping Company needs to follow.

With Regards

Advocates & Notaries -Legal Consultants-HR

E-mail : rajanassociates@eth,net,

Mobile : 9025792684
From India, Bangalore
Sub: Whether Staffing Industry is Industry ?
A confusion may come into the mind of the HR practitioners in the Staffing & Flexi Staffing Industry whether it will come within the definition of Industry .
For this Sec 2 (j) of the Industrial Disputes Act has to be read which defines "industry" means any systematic activity carried on by co-operation between an employer and his workmen (whether such workmen are employed by such employer directly or by or through any agency, including a contractor) for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes (not being wants or wishes which are merely spiritual or religious in nature), whether or not, - (i) any capital has been invested for the purpose of carrying on such activity; or
(ii) such activity is carried on with a motive to make any gain or profit, and includes - (a) any activity of the Dock Labour Board established under section 5A of the Dock Workers (Regulation of Employment) Act, 1948 (9 of 1949);
(b) any activity relating to the promotion of sales or business or both carried on by an establishment, but does not include - (1) any agricultural operation except where such agricultural operation is carried on in an integrated manner with any other activity (being any such activity as is referred to in the foregoing provisions of this clause) and such other activity is the predominant one.
Explanation : For the purposes of this sub-clause, "agricultural operation" does not include any activity carried on in a plantation as defined in clause (f) of section 2 of the Plantations Labour Act, 1951 (69 of 1951); or
(2) hospitals or dispensaries; or
(3) educational, scientific, research or training institutions; or
(4) institutions owned or managed by organizations wholly or substantially engaged in any charitable, social or philanthropic service; or
(5) khadi or village industries; or
(6) any activity of the Government relatable to the sovereign functions of the Government including all the activities carried on by the departments of the Central Government dealing with defence research, atomic energy and space; or
(7) any domestic service; or
( any activity, being a profession practised by an individual or body of individuals, if the number of persons employed by the individuals or body of individuals in relation to such profession is less than ten; or
(9) any activity, being an activity carried on by a co-operative society or a club or any other like body of individuals, if the number of persons employed by the co-operative society, club or other like body of individuals in relation to such activity is less than ten;
The portion {"industry" means any systematic activity carried on by co-operation between an employer and his workmen (whether such workmen are employed by such employer directly or by or through any agency, including a contractor) for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes ]}will clarify this as it will come within the supply of Services through a Contractor.
Consequently the relevant provisions of the ID Act will become applicable.
With Regards
Advocates & Notaries & Legal Consultants for Staffing & Recruiting Industry
E-mail : rajanassociates@eth,net,
-9025792684-9025792634
From India, Bangalore
Sub: Inclusion of Arbitration Clause in Flexi Staffing Agreements.

Dear All

The Flexi Staffing Industry is burdened with the problem of chasing payments from the Clients and has become a perennial issue. The reward for the effort which is the essence of the Staffing Industry is taken away and these unpaid Invoices become Bad debts .

This is on account of the absence of protective clauses in the Staffing Agreement.

The solution for this is to include an Arbitration clause .This will help the Industry to have some hold on the Client in recovering the dues.

The advantage by including this clause is will result in protective step being initiated in accordance with this clause when there is default without incurring heavy costs of Court Fee by invoking the Arbitration Courts help by requesting the Court to issue a direction to the Client pending the Arbitration proceedings. This will ultimately protect the recovery process of outstanding Invoices.

The Industry should make a beginning if the clause is already not there in their Template.This is critical for Business and reduces the risk and will aid in timely collection of dues.

With Regards

Advocates & Notaries & Legal Consultants for Recruiting & Staffing Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

Sub:Typical Arbitration Clause

Following the earlier post Arbitration by itself means referring the dispute between the Client and the Agency to an Arbitral Panel instead of rushing to the Court.This saves time and money.The typical clause can be like this:

"In the event of any dispute, difference or question arising out of or in respect of this agreement or the commission of any breach of any terms thereof or of compensation payable thereof or claim made by either of the parties against the other in any manner whatsoever in connection with it, the same shall be referred to a Sole Arbitrator to be selected and appointed by mutual agreement for arbitration as provided in the Arbitration and Conciliation Act 1996 and Rules framed therein.. The decision or award so given by the Single Arbitrator shall be final and binding on the parties hereto.Initially the costs of the arbitration shall be borne equally by both parties and the award shall tax the costs of the Arbitration the party against whom the Award is passed."

Suitable modification can be made depending upon the need .The advantage of having a sole arbitrator is to reduce costs.Please see the Arbitration and Conciliation Act 1996 for more details on the process.

With Regards

Advocates & Notaries & Legal Consultants for Recruiting & Staffing Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All
Tim Roth ,Chief Legal officer of Manpower Inc at Milwaukee a Fortune 500 Company in his Blog has reported that he conducted a survey of the finest Employment Lawyers in the USA to get their answers to the following question:
What are the top ten employment law issues most likely to wake you up screaming in the middle of the night?
Here are the answers . . .
1. Inadequate knowledge of employment law basics
2. Executive misconduct
3. Any form of discrimination
4. Wage and hour violations
5. Retaliation
6. Inadequate investigation
7. Failure to follow policies
8. Bad documentation/communication
9. Emotional rather than fact-based decisions
10. Inconsistency
This equally applies to the Indian Staffing and Recruiting Industry and thanks to Tim for waking us.
For more see : <link no longer exists - removed>
With Regards
Advocates & Notaries & Legal Consultants for Recruiting & Staffing Industry
E-mail : rajanassociates@eth,net,
-9025792684-9025792634
From India, Bangalore
Sub: Misconduct Termination-

Dear All


Many a times Staffing Industry Consultants and HR Managers are confronted with the following question.

Can we fire a Temporary Employee sent to the Client for working without giving notice period due to misbehavior or if he is found drunk during working ours do we still have to pay the notice period?

Section 13 of the Delhi Shops Act lists the Acts and omission constituting misconduct

for the purpose of Section 30,misconduct shall include the following acts and omission on the part of an employee:
(a) willful insubordination or disobedience, whether or no not in combination with another, of any lawful and reasonable order of superior;
(b) going on an illegal strike or inciting, abetting or instigation or acting in furtherance thereof;
(c) willful slowing down in performance of work, or abetment, or instigation thereof;
(d) theft, fraud, misappropriation or dishonesty in connection with the employer's business or property;
(e) habitual absence without leave, overstaying the sanctioned leave without sufficient grounds, or proper and satisfactory explanation, or habitual late attendance;
(f) commission of any act subversive of discipline or good behaviour on the premises of establishment, such as. drunkenness, riotous, disorderly or indecent behaviour, gambling or holding meeting without previous permission of the employer or taking or giving bribes or any illegal gratification whatsoever;
(g) habitual neglect of work or gross or habitual negligence;
(h) willful damage to work in process or to any property if the establishment;
(i) disclosing to any unauthorised person any information in regard to the processes of the establishment which may come into the possession of the employee in the course if his work.

Therefore drunkenness will come within (f) above.

Section 30: Notice of dismissal

(1) No employer shall dispense with the services of an employee who has been in his continuous employment for not less than three months, without giving such person at least one months' notice in writing or wages in lieu of such notice :

Provided that such notice shall not be necessary where services of such employee are dispensed with for misconduct, after giving him an opportunity to explain the charge or charges against him in writing.

Therefore you will have to follow the procedure of first getting a report from the Client on the misconduct and then issue Show cause Notice and conduct an Enquiry by appointing an Enquiry Officers report and act based on the Enquiry officers report.This is a safe and secure process .But many of the Temporary Employees considering their future will opt to resign facilitating the exit process.

The reference to the Delhi Act is for illustration and each report of "Misconduct" has to be tackled in accordance with the Shops and Establishments Act applicable to that State where the Temporary Employee is working.

With Regards

Advocates & Notaries -Legal Consultants-HR

E-mail : rajanassociates@eth,net,

Mobile : 9025792684
From India, Bangalore
IMMEDIATE LEGAL QUESTIONS HAUNTING INDIAN STAFFING COMPANIES

Having been focused on the Staffing Industry in India which is at its crucial stage and our long standing experience of 30 years in the direct Litigation Support and acting for PSU‘s and Corporate and present counseling in Staffing Business for important Staffing Industry players we have always been focused on the analysis of proactive and preventive steps Staffing Companies can and should take to avoid claims and liability.

Despite these efforts it seems the Lawyers and Consultants end up doing more damage control in Courts and Tribunals. Through this damage control many lessons are learned. This is a continuing effort and cannot be viewed on a short term basis.

With each matter the Staffing Companies legal Team have always made an effort and during the course of the case and certainly at the end to talk about lessons learned. While they are numerous, and each perspective could be the subject of a book on the topic, the following are a few amongst the many key questions of which this is the first part:

1. Many a times the Contract signed with the employee is styled as Fixed Term Contract with a stipulation for termination, why is that there is litigation on termination ?

The Law is not clear since there is no positive provision in the Industrial Disputes Act as the action for termination in a Fixed Term Contract hinges on exclusion provided under Sec 2 (oo) of the Industrial Disputes Act. Therefore application of the exclusion by the Employer is subject to the Redressal Mechanism provided in the Act and there being different layers of redressal the damages that it could cause to the Staffing Company on an order of re-instatement could be onerous.Clients may insist termination without Notice pay but the best bet is to have a secure termination process based on sound legal advice.

With Regards

Advocates & Notaries -Legal Consultants-HR

E-mail : rajanassociates@eth,net,

Mobile : 9025792684-9025792634
From India, Bangalore
Dear All

Sub: ID Card for Temporary workers .

In continuation of our earlier post on the subject of IMMEDIATE LEGAL QUESTIONS HAUNTING INDIAN STAFFING COMPANIES:

In the Temping Industry a common Question like this keeps cropping up:

I am designing ID cards for temporary employees. Is it important to mention the employee status as "temporary employee" or name and designation is enough.

Answer : There need not be any doubt the Form is mandated in the CLRA Rules

76. Employment card.-(I) Every contractor shall issue an employment card in Form XIV to each worker within three days of the employment of the worker .
(II) The card shall be maintained up to date and any change in the particulars shall be entered therein.

Therefore if you just say Form XIV of the CLRA Rules 1971 it is sufficient.You can refer to the Form in the Rules and go by it.

With Regards

Advocates & Notaries & Legal Consultants for Staffing & Recruiting Industry

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

In the Staffing or Temping Industry the following can be considered as pillars of Legal Compliance :

1.Compliance-Statutory -.Liaison with Departments on the following :

Labour Welfare Fund ACT Statement of Contribution along with cheque to be submitted to the Authority Concerned.

The Profession Tax ACT Monthly Returns along with cheque.

The Contract Labour (R&A) ACT, 1970 Half Yearly Return - by Contractor to be submitted to Asst. Labour Commissioner

The Maternity Benefit ACT, 1961 Annual Return

The (National & Festival Holidays) ACT, 1963 Annual Return.

The Minimum Wages ACT, 1948 Annual Return

The Contract Labour (R&A) ACT, 1970 Annual Return by Principal Employer.

The Payment of Wages ACT, 1936 Annual Return

The Employees Provident Fund ACT, 1952 3A & 6A Annual Individual Returns & Returns of Contributions to the Regional Provident Fund Commissioner.

The Employees State Insurance ACT, 1948 Summary of Contribution

The Contract Labour (R&A) ACT, 1970 Renewal of Licence .

The Payment of Bonus ACT, 1965 Annual Return

Shops & Establishment Act Renewal & Registration Certificate.

Temporary Employees

Joining Compliance

Monthly Compliance of Statutes in respect of the Temps .


Exit /Resignation/Severance /Termination Compliance

2.Compliance-Audit -Conduct Audit i.e verification of the Compliance done under (1) either monthly/quarterly ,Half yearly and improve / enforce compliance .An audit report should follow the Audit..

3. Legal Consultation & Litigation Support-Provide Legal Support and advisory services for (1) & (2).

The above can be done Branch wise .If all the three are independent and existing and report their activities by way of MIS, any Staffing or Temping organization can have trouble free functioning. These can exist within the very organization itself or "out-sourced" .Of course cost is involved but the cost will be nothing when compared to encountering and settling claims out of violations.

With Regards

Advocates & Notaries -Legal Consultants-HR

E-mail : rajanassociates@eth,net,

Mobile : 9025792684.
From India, Bangalore
IMMEDIATE LEGAL QUESTIONS HAUNTING INDIAN STAFFING COMPANIES

In continuation of our earlier post on the subject :

Clients want the Staffing or Temping Company to terminate the Employee for dishonesty, theft, misconduct etc? Is it correct?

There is nothing like summary termination in Indian Law except if it is for proven mis-conduct.

It has to be proven beyond doubt in an Enquiry done for the purpose. In Staffing & Temping Business such Enquiry cannot be practically done as the incident would have occurred in the Clients place.Definitely the risk is there in such termination action without conducting an enquiry is there.There is an element of practical and high risk in such terminations.All such terminations can bounce back with possible Labour Claims.

A definitive process with expert Legal support has to be chalked out with the concurrence of the Client at the time of signing the Contract with the Client itself.

With Regards

Advocates & Notaries -Legal Consultants-HR

E-mail : rajanassociates@eth,net,

Mobile : 9025792684-9025792634
From India, Bangalore
Dear All
We have found an interesting post on "What you need to know before buying background checks online "at What you need to know before buying background checks online which may be relevant in this post when hiring agencies for conducting Background checks while recruiting personnel for the Staffing Business.
In the Indian context the availability of on line check is still to start. NASCOM has made a beginning for the Software Industry by opening a "National Skills Registry" Pls see http://nationalskillsregistry.com <link updated to site home>
With Regards
Advocates & Notaries & Legal Consultants for Recruiting & Staffing Industry
E-mail : rajanassociates@eth,net,
-9025792684-9025792634
From India, Bangalore
IMMEDIATE LEGAL QUESTIONS HAUNTING INDIAN STAFFING COMPANIES

Dear All

In continuation of our earlier post on the subject :

Questions are raised on the rotation of employees of contractors working with Principal Employers ,

The Contractor’s employees are working in XYZ co. [Client] and the employees are on the Contractors pay roll. The Contractor provides them PF . ESIC , Gratuity ,bonus , leave salary ,etc, But the Principal Employer wants rotation of the Contractor Employees who have completed 180 days and wants appointment of new employees in the place of left employees,

Can the request be acceded because ,all the employees are on the permanent rolls of the Contractor and not on contract basis.

The request of the Client can be accepted and is meant to provide break of service from continuous employment. Otherwise the Staffing Company or Contractor will lose business .The concept of continuous employment is found in Sec 25 B of the Industrial Disputes Act .

25-B. Definition of continuous service: -- For the purpose of this Chapter,-

(1) a workman shall be said to be in continuous service for a period if he is, for that period, in uninterrupted service, including service which may be interrupted on account of sickness or authorized leave or an accident or a strike which is not illegal, or a lock-out or a cessation of work which is not due to any fault on the part of the workman;

(2) Where a workman is not in continuous service within the meaning of clause (1) for a period of one year or six months, he shall be deemed to be in continuous service under an employer—

(a) for a period of one year, if the workman, during a period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than—

(i) one hundred and ninety days in the case of a workman employed below ground in a mine; and
(ii) two hundred and forty days, in any other case;

(b) for a period of six months, if the workman, during a period of six calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than—

(i) ninety five days, in the case of a workman employed below ground in a mine; and
(ii) one hundred and twenty days, in any other case;

Explanation: -- For the purpose of clause (2), the number of days on which a workman has actually worked under an employer shall include the days on which—

(i) he has been laid-off under an agreement or as permitted by standing orders made under the Industrial Employment [Standing Orders] Act, 1946 (20 of 1946), or under this Act or under any other law applicable to the Industrial establishment;

(ii) he has been on leave with full wages, earned in the previous years;
(iii) he has been absent due to temporary disablement caused by accident arising out of and in the course of his employment; and
(iv) in the case of a female, she has been on maternity leave; so, however, that the total period of such maternity leave does not exceed twelve weeks.

The Client from their end want to overcome the “continuous employment of the Contractor’s employee with them "for various reasons like avoiding a claim for permanency from the Contractor’s employees and this cannot be faulted. In case the employees are permanent on the Contractor’s rolls which means you need to swap your employees between different Clients. From the "dedicated" mode of deputation a need may arise to switch to "multiple" mode. This is where the Indian Temp Staff Industry must aim to go..The Appointment Letter and Agreement with the Contractors Staff has to be tuned to take care of all this with expert legal help.

There are many inter-related issues to this which we will address in our further posts.

With Regards

V.Sounder Rajan

Advocates & Notaries -Legal Consultants-HR

E-mail : rajanassociates@eth,net,

Mobile : 9025792684.
From India, Bangalore
Dear All

By way of refurbishing HR Knowledge for the Staffing Industry we have attached the historic ESI Circular which in effect had recognized Outsourcing as a legal practice in India .In our earlier post on the same subject we had not highlighted the gist whiich we are doing in this post.

As per ESI Circular the following types of Outsourcing Contracts are recognized It categorizes the outsourcing, process and calls outsourcing in a simple term of “Job work”:

(a) The Jobwork done inside the factory/establishment premises through Contractors/Immediate Employers having independent ESIC Code Nos.

(b) Jobwork done inside the factory premises through Contractors/Immediate Employers not having independent ESIC Code Nos.

(c) Jobwork done outside the factory/establishment premises through factories/establishments which are having independent Code Nos.:

(d) Jobwork done outside the factory/establishment premises through factories/establishments which are not having independent Code Nos but the supervision being exercised by the Principal Employer

(e) Jobwork done outside the factory premises through units engaging less than 10/20 employees but working exclusively for the Principal Employer

(f) Jobwork done outside the factory/establishment premises through factory/establishment engaging less than 10/20 employees which are not independently coverable, and where no supervision is exercised and who are undertaking the work for more than one employer

(g) Jobwork done outside the factory premises through Contractors/Immediate Employers who perform the work through Home workers or works in non-implemented areas

With regards

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore

Attached Files
Membership is required for download. Create An Account First
File Type: doc -VSRA-ESI-circular on-outsourcing-231210.doc (82.0 KB, 117 views)

Sub: Union Government open to Changes in Contract Labour Law[CLRA] .

Dear All

As per the report of the Premier Press Organization in India Press Trust of India [PTI] in its report dated 22-10-2010 published in the Business Standard of 23 rd October 2010 Hon’ble Minister of State for Labour and Employment Mr Harish Rawat addressing a seminar on 'Management of Contract Labour in PSEs'[Public Sector Enterprises] organized by Standing Conference of Public Enterprise expressed concerns over denial of statutory benefits to contract labour, and said the government would proceed on amendments to the law for such workers with an open mind.

"As far as amendments to the Contract Labour (Regulation & Abolition) Act, 1970 are concerned, we will proceed with an open mind," Mr Rawat said Industry has been demanding for long that the Section-10 to the Contract Labour (Regulation & Abolition) Act 1970 should be dispensed with but indicated that on the contrary, the Unionists think the other way round. He indicated that under Section 10 the Government can identify any process, operation or other work in an establishment, where it can prohibit any employment of contract labour and pointed out that the act is aimed to abolish and regulate contract labour.

Asked whether, any amendment bill for making changes in the Act is expected to be tabled in the forthcoming winter session, Mr Rawat said, "We are preparing the draft bill which is unlikely to be tabled in the next Parliament session."

The Minister urged the public sector to be a role model employer and to show a pathway to the private sector in implementing government regulations on labour.

Echoing similar views, Labour Secretary P .C .Chaturvedi said, "The law (for contract labour) has lost its spirit. There was an intention to reduce labour law over period of time, but it happened the other way round."
"Everybody is employing contract labour to reduce cost. But cutting cost does not mean exploitation of labour. It should be done by increasing productivity by modernization, best practices and using best technology," he said.

Mr Chaturvedi said, "Now public sector is using contract labour to cut cost and such workers are treated as second grade citizens."

"It is the PSUs, which should show the way to private sector. If the contract workers are treated with human face, the demand of regularization (of employment) would mellow down," he added.

On this occasion, Director General SCOPE U D Choubey said: "There are plethora of social security laws in India and SCOPE endorses the views of the government that welfare of the workers is a real concern as large number of people in the country are living below poverty line."

We support the views of the Minister and Labour Secretary P C Chaturvedi that there should be a balanced approach.

We eagerly await the draft legislation on behalf of the Industry.

With Regards

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Though the Act in its title proclaims "Abolition" of contract labour, in effect, it only 'regulates' the employment of contract labour.
The reality is that today contract labour has become an essential source of employment in any industry/office, be it private or government. It is told that even is some judicial forums contract labour exists. So it is an accepted mode of employment.
Efforts should therefore be made to ensure that such mode of employment does not lead to exploitation of labour. At the same time the concerns of employers to have a disciplined and flexible workforce for effective and profitable working should also be addressed.
From India, Madras
IMMEDIATE LEGAL QUESTIONS HAUNTING INDIAN STAFFING COMPANIES

In continuation of our earlier post on the subject :

A common question arises in Contractual Employment Whether on termination of the Contract Employee the Employer is bound to issue the Experience certificate ?

In Contract Labour Law [CLRA] the Relieving Letter is called as Service Certificate and governed by Rule 77 of the CLRA Rules .This can also be called as the Experience Certificate.

Service certificate.-On termination of employment for any reason whatsoever the contractor shall issue to the workman whose services have been terminated a

Service Certificate in Form XV.

The salient details are:

Name and address of contractor
Name and address of establishment in/
under which contract is carried on …………
Nature and location of work
Name and address of the workman
Age or Date of Birth
Identification Marks
Father's / Husband's name
Total period Employed
Starting Date:
Ending date:
Nature of the Work :
Details of Salary/Wages;

Consequently issue of the Service Certificate as per Form XV is mandatory.It has to be automatically issued without request from the Contract Employee for the following cases:

1.Termination
2.Resignation
3.Absconding or voluntary cessation of work.

Issue of the Service Certificate is also protective as the Last working Day with the Contractor and the Principal Employer is established.Therefore from the Employers side there should be no hesitation in issuing this certificate as a part of the F & F.Impression to the contrary may lead to Labour claims for back wages and re-instatement claims.

With Regards

V.Sounder Rajan

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore

Attached Files
Membership is required for download. Create An Account First
File Type: doc VSRA-form15-SERVICE CERTIFICATE.doc (33.0 KB, 250 views)

Dear All

IMMEDIATE LEGAL QUESTIONS HAUNTING INDIAN STAFFING COMPANIES

In continuation of our earlier post on the subject:

A common question arises in Contractual Employment "Whether on termination of the Contract Employee the Employer is bound to settle the dues to the Employee at his own sweet will and pleasure or there is any rule to settle it within a time?

In the Contract Labour Law [CLRA] Rule 66 provides for the answer. It reads like this:

“Where the employment of any worker is terminated by or contractor the wages earned by him shall be paid before the expiry of the second working day from the day on which ‘he employment is terminated. “

Therefore there is a duty to settle the dues of employee before the expiry of the second working day from the day on which the employment is terminated.

Employers therefore cannot legally delay the Full & Final Settlement of Temporary or Contract Employees beyond the Statutory period .

With Regards

V.Sounder Rajan

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

Mobile : 9025792684-9025792634
From India, Bangalore
BEST WISHES TO OUR FOLLOWERS FOR A PROSPEROUS 2011.

IMMEDIATE LEGAL QUESTIONS FOR INDIAN STAFFING COMPANIES

In continuation of our earlier post on the subject:

A common question arises in Contractual Employment on the duty of the Principal Employer in ensuring timely payment of Salaries to the Contract workmen

Rule 72 of the CLRA Rules states as follows:

"The principal employer shall ensure the presence of his authorized representative at the place and time of disbursement of wages by the contractor to workman and it shall be the duty of the contractor to ensure the disbursement wages in the presence of such authorized representative. "

Consequently when the rule clearly stipulates a duty on the part of the Principal Employer to be present at the place and time of disbursement of wages by the contractor to workman and also the duty of the contractor to ensure the disbursement wages in the presence of of the Principal Employer it is a matter of Joint responsibility .

With Regards

V.Sounder Rajan

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684.
From India, Bangalore
Dear All

In continuation of our earlier post on timely payment of wages to the Contractor's employees under Rule 72 of CLRA Rules under the next Rule 73 it is expressly provided that the authorized representative of the principal employer shall record under his signature a certificate at the end of the entries in the register of wages or the [Register of Wages-cum-Muster Roll as the case may be in following form:

“Certified that the amount shown in column No---------- has been paid to the workmen concerned in my presence on -------- at ---------“

Actually the Rules provide for supervision and certification by the Principal Employer at the time of very payment to the Contractor's employees by the Contractor .

With Regards

V.Sounder Rajan

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684.
From India, Bangalore
IMMEDIATE LEGAL QUESTIONS HAUNTING INDIAN STAFFING COMPANIES

In continuation of our earlier post on the subject:

What is Sec 25 F of the Industrial Disputes Act 1947

It reads like this :

25F. CONDITIONS PRECEDENT TO RETRENCHMENT OF WORKMEN. - No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until - (a) the workman has been given one month's notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice;
(b) the workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days' average pay for every completed year of continuous service or any part thereof in excess of six months; and
(c) notice in the prescribed manner is served on the appropriate Government or such authority as may be specified by the appropriate Government by notification in the Official Gazette.

Since the word “retrenchment is used in Section 25 F the definition of retrenchment has to be seen in Section 2 (OO) :

(oo) "retrenchment" means the termination by the employer of the service of a workman for any reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action, but does not include –
(a) voluntary retirement of the workman; or
(b) retirement of the workman on reaching the age of superannuating if the contract of employment between the employer and the workman concerned contains a stipulation in that behalf; or
(bb) termination of the service of the workman as a result of the non-removal of the contract of employment between the employer and the workman concerned on its expiry or of such contract being terminated under a stipulation in that behalf contained therein; or
(c) termination of the service of a workman on the ground of continued ill-health;

For Compliance of Sec 25 F of the ID Act the following is to be done :

i. The employee of the Staffing Entity sent for work to the Client must be given a one month's notice in writing, indicating the reasons for retrenchment. The retrenchment can take effect only after the notice period has expired, or if the employee of the Staffing Entity sent for work to the Client has been paid wages in lieu of such notice.

ii. The employee of the Staffing Entity sent for work to the Client must be paid, at the time of retrenchment, compensation, which is equivalent to fifteen days' average pay for every completed year of continuous service or any part thereof in excess of six months.

iii. A notice must be served in the prescribed manner, on the appropriate Government. (Section 25F of the ID Act)

With Regards

V.Sounder Rajan

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684.
From India, Bangalore
IMMEDIATE LEGAL QUESTIONS HAUNTING INDIAN STAFFING COMPANIES

In continuation of our earlier post on the subject

A common question arises in the Staffing Industry is whether compliance of Sec 25(F) of the Industrial Disputes Act a correct process for termination of the Deputed candidate?

Absolutely it is a water tight process and a safeguard for avoidance of wrongful Termination litigation .In the field you will find Clients will hesitate to minimum provide the 15 days’ notice for terminating the candidate.

For Compliance of Sec 25 F of the ID Act the following is to be done :

i. The employee of the Staffing Entity sent for work to the Client must be given a one month's notice in writing, indicating the reasons for retrenchment. The retrenchment can take effect only after the notice period has expired, or if the employee of the Staffing Entity sent for work to the Client has been paid wages in lieu of such notice.

ii. The employee of the Staffing Entity sent for work to the Client must be paid, at the time of retrenchment, compensation, which is equivalent to fifteen days' average pay for every completed year of continuous service or any part thereof in excess of six months.

iii. A notice must be served in the prescribed manner, on the appropriate Government. (Section 25F of the ID Act).It has become a practice in the Industry to dispense with this Notice.Government can take steps to delete this provision .

With Regards

V.Sounder Rajan

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684.
From India, Bangalore
Dear All

Sub: Statistics of Enforcement of CLRA by the Central Govt

The enforcement of the provisions of various Labour laws has been prescribed under provisions of the relevant Acts and is secured through the officers of the Central Industrial Relations Machinery (CIRM) in the Central Sphere, and through the State enforcement machinery in the State Sphere.

In the Central sphere, the officer of Chief Labour Commissioner (Central)s organization conduct inspection regularly under the Contract Labour ( Regulation & Abolition) Act, 1970 and take action by filing prosecution cases against the defaulting employers and contractors.



Details of Inspection conducted and prosecution launched during the last three years and current year under Contract Labour Act, 1970 is found in the Attachment.Shri Harish Rawat, Minister of Labour and Employment gave this information in reply to a question in the Lok Sabha .

The attached data will give a picture on the realistic Enforcement scenario in respect of these two enactments .

Presently the level playing field available for the Indian Staffing Industry to operate in the present liberalised regime of the Central Government is again seen and is found to be quite adequate and is commendable and will be an invitation to International Staffing & Recruiting Companies to open shop in India

With Regards

V.Sounder Rajan

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore

Attached Files
Membership is required for download. Create An Account First
File Type: doc CLRA- Statistics -110111.doc (28.5 KB, 177 views)

IMMEDIATE LEGAL QUESTIONS FOR INDIAN STAFFING COMPANIES

Sub:Recovery for damage or loss to the Clients property.

A common question arises in Contractual Employment when Contract Employees sent for work with the Client cause damage or loss to the Clients property.

The Client then makes a claim on the Temping or Staffing Company and wants the loss to be adjusted in the Contract Employees salary. Can such a request be entertained?

The Temping or Staffing Contractor cannot adjust it without affording an opportunity to the Contract Employee. Apparently is for the period, the Contract Employee had worked. Recovery from salary has to be u/s.10 of the Payment Wages Act, 1936 is for a loss provided under clause ( c ) of sub-section (2) of section 7 extracted below:

Clause ( c ) of sub-section (2) of section 7:

(c ) deductions for damage to or loss of goods expressly entrusted to the employed person for custody, or for loss of money for which he is required to account, where such damage or loss is directly attributable to his neglect or default;

10. Deductions for damage or loss:- (1) A deduction under clause ( c ) or clause (o) of sub-section (2) of section 7 shall not exceed the amount of the damage or loss caused to the employer by the neglect or default of the employed person.
(1-A) A deduction shall not be made under clause ( c) or clause (m) or clause (n) or clause (o) of sub section (2) of section 7 until the employed person has been given opportunity of showing cause against the deduction, or otherwise than in accordance with such procedure as may be prescribed for the making of such deductions.
(2) All such deductions and all realizations thereof shall be recorded in a register to be kept by the person responsible for the payment of wages under section 3 in such form as may be prescribed.


Recovery from the salary can be done only after following the above procedure which is a due process of law as provided above;

First by issuing a show cause notice for salary adjustment and after receiving objection if any ;and

Second pass an order of Adjustment; and

Third record the proof of delivery of the Salary adjustment letter ;and

Lastly the adjustment request from the Clients claim can be entertained.

This procedure can be made part of the Code of Conduct issued by the Staffing or Temping Company to their Contract Employees.

With Regards

V.Sounder Rajan

Advocates & Notaries & Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

We send our Pongal & Maha Sankranti Greetings .

Significance of Pongal

Pongal is a harvest festival - the Tamil equivalent of Thanksgiving. It is held to honor the Sun, for a bountiful harvest. Families gather to rejoice and share their joy and their harvests with others. The Sun is offered a "Pongal" of rice and milk.

Literally meaning "Boiling over", Pongal, signifies the advent of prosperity. Pongal is normally celebrated over a period of four days, starting on the 13th January. Since the calculation to determine the day is based on the solar calendar, the date doesn't change. It is considered a very auspicious occasion when the Sun transits the Capricorn sign. A rich and abundant harvest of paddy and other crops depend on the availability of good rain, as most of the rivers in Tamil Nadu are not perennial. Hence, there is the invocation of the Sun God and the God of Rain at the time of Pongal.

The period is referred to as Uttarayan Punyakalam and is considered auspicious. Legend has it that the Devas wake up after a six-month long slumber during this period. And so it is believed that those pass away during Uttarayana attain salvation. In fact, Bheeshma is believed to have waited for the dawn of Uttarayana before he gave up his life.

As is customary, cleaning of every house a few days prior to the Pongal festival is an indispensable ritual. Not only every house is cleaned, but it is also dusted and whitewashed. Wearing new clothes on Pongal is also customary. Attired in a new "Lehanga" and half sari for young girls and lungi and angavastram, the men, women and children prepare themselves for celebrating the first day called Bhogi Pandigai. This day is dedicated to Indra, who is also called Bhogi. It is believed that on this day Lord Krishna had urged the people to neglect Indra and not worship him. People take oil bath on this day. Using rice paste "Kolam" is drawn and this represents the Sun. The items that are generally used to celebrate Pongal; Sandalwood paste, vermilion, mango saplings, coconut fronds, sugarcanes, banana leaves, ginger pieces, white flour, new vessels for cooking, tu

Pongal is a four-day affair. The first day, Bhogi, is celebrated on the last day of the month of Margazhi. Scholars have often compared Bhogi to the Indra Vizha celebrated by the Chola kings at Kaveripattinam, also known as Poompuhar. Indra Vizha was celebrated in honour of Lord Indra, also called Bhogi, the God of thunder and rain.

The second day is Surya Pongal also called Perum Pongal. It is the most important day and people worship Surya, the Sun God and his consorts, Chaya and Samgnya. There are several legends associated with Surya Pongal. A sage named Hema prayed to Lord Vishnu on the banks of the Pottramarai tank in Kumbakonam. On Surya Pongal day, the lord is believed to have taken the form of Sarangapani and blessed the sage. Yet another legend has it that Lord Shiva performed a miracle where a stone image of an elephant ate a piece of sugarcane.

The third day is Mattu Pongal, celebrated to glorify cattle that help farmers in a myriad ways. On this day, the cows are bathed and decorated with vermilion and garlands and fed. The last day is Kaanum Pongal. It is that part of the festival when families used to gather on the riverbanks and have a sumptuous meal (kootanchoru). It is also time for some traditional dances such as kummi and kolattam. In recent years, that day is celebrated as Uzhavar Tirunal in honor of farmers.

The dishes prepared during these days are "Sarkarai Pongal", "Ven Pongal", Dosai and Sambhar, Vadai and Payasam (a sweet rice pudding).

The sun itself stands for all the ideals of the Pongal festival. Its message is that of light, unity, equality and true selflessness. These are the ideals of Karma Yoga. Hence, the sun is the greatest Karma Yogi.

When we celebrate Pongal, our sense of value changes. We begin to understand that our real wealth is the goodwill and friendship of your relatives, friends, neighbors and other human beings and ESPECIALLY OUR VIEWERS IN CITEHR .

Our wealth is the land on which our food grows, the cattle which help us in agriculture, and the cow which gives us milk. We begin to have greater love and respect for them and for all living beings – the crows, the fish and all other creatures.

To the agriculturalist, Pongal is a day of triumph. He would have by then brought home the fruits of his patient toil. Symbolically, the first harvest is offered to the Almighty – and that is Pongal. To toil was his task, his duty, but the fruit is now offered to the Lord. This is the spirit of Karma Yoga.

Thanks & Regards

V.Sounder Rajan -
Advocates & Notaries -Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

We are back after the Pongal Break .

NEXT IMMEDIATE LEGAL QUESTIONS FOR INDIAN STAFFING COMPANIES

A common question arises in Contractual Employment whether the doctrine of equal pay for equal work incorporated in the CLRA and is there a need for Contractors and Principal Employers to adhere to this?

Yes .It is incorporated in Rule 25 of the CLRA Rules which is extracted below:

25. Form and terms and condition of licence,—{l) Every licence granted under sub-section (1) of Sec. 12

shall be in Form VI.

(2) Every licence granted under sub-rule (11) or renewed under 29 shall be subject to the following conditions, namely:

*******

(v) (a) In cases where the workmen employed by the contractor perform the same or similar kind of work as the workmen directly employed by the principal employer of the establishment, the wage rates, holidays, hours of work and other conditions of service of the workmen of the contractor shall be the same as applicable to the workman directly employed by the principal employer of the establishment on the same or similar kind of work

Provided that in the case of any disagreement with regard to the type of work the same shall be decided by the Labour Commissioner .

The effect of the rule is that wherever Contract Labour or Temporary Employees are appointed i.e where the workmen employed by the contractor perform the same or similar kind of work as the workmen directly employed by the principal employer of the establishment, the wage rates, holidays, hours of work and other conditions of service of the workmen of the contractor shall be the same as applicable to the workman directly employed by the principal employer of the establishment on the same or similar kind of work.

In a recent Judgment of the Madras High Court Madurai Bench decided by Mr Justice K..Chandru in the matter of A.Victor vs Executive Director BHEL it has been held that In case a contract workman is paid less than the wages payable to a similarly placed workman by the principal employer, the TN Contract Labour Rules, 1975, has a remedy under Rule 25(v)(a).Justice K.Chandru Quoting the rules, held that in such circumstances, it was for the registering authority to go into the question as to whether the workman employed by the contractor performed the same or similar kind of work, as the workman directly employed by the principal employer.But it was held that the High Court would not entertain the Writ Petition to implement the circular dated July 28, 2005, issued by R-1 (BHEL, Corporate Office, New Delhi 110 049) and to revise the wages to employees who were working as contract labour through the labour contract society.

Both the Principal Employer as well as the Staffing Agency has to ensure the above compliance.If there is violation the Contract Employee has the remedy under Rule 25(v)(a) of CLRA Rules.

Thanks & Regards

V.Sounder Rajan -
Advocates & Notaries -Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

NEXT IMMEDIATE LEGAL QUESTIONS FOR INDIAN STAFFING OR TEMPING COMPANIES

A common question arises in Contractual Employment whether the Staffing or Temping Agency Employees sent for work to the Clients place are to be paid Minimum Wages Act ?

Yes .It is incorporated in Rule 25 of the CLRA Rules which is extracted below:

25. Form and terms and condition of licence,—{l) Every licence granted under sub-section (1) of Sec. 12

shall be in Form VI.

(2) Every licence granted under sub-rule (11) or renewed under the rules shall be subject to the following conditions, namely:

(IV) the rates of wages payable to the workmen by the contractor shall not be less than the rates prescribed under the Minimum Wages Act,1948 for such employment where applicable, and where the rates have been fixed by agreement, settlement or award, not less than the rates so fixed.

Consequently compliance of Minimum Wages is mandatory and not optional.

In fact the Inspecting Agencies under the Payment of Wages Act both Center and States keep this compliance as a priority issue for inspection and strict action is taken.

Next time when any Staffing or Temping Agency gets a Notice after inspection the issue is to be taken very seriously and proper reply is to be sent by the Staffing or Temping Agency

Thanks & Regards

V.Sounder Rajan -
Advocates & Notaries -Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Dear All

PUNISHMENT FOR NON COMPLIANCE OF MINIMUM WAGES ACT

NEXT IMMEDIATE LEGAL QUESTIONS FOR INDIAN STAFFING OR TEMPING COMPANIES

In continuation of our previous post on compliance of Minimum Wages Act the next question is the nature and type of penal action that can be taken by the authorities against the Staffing Entity or Contractor for non compliance of the Minimum Wages Act?

For non compliance Sec 20 (3) (i) of the Minimum Wages Act provides that in the case of a claim arising out of payment of less than the minimum rates of wages the payment to the employee of the amount by which the minimum wages payable to him exceed the amount actually paid together with the payment of such compensation as the authority may think fit not exceeding ten times the amount of such excess.

In short the violator may have to shell out upto 10 times compensation amount together with compliance of the Minimum Wages Act .

Apart from the above Section 22 provides for penalty to any employer who pays to any employee less than the minimum rates of wages fixed for that employee's class of work or less than the amount due to him under the provisions of the Minimum Wages Act shall be punishable with imprisonment for a term which may extend to six months or with fine which may extend to five hundred rupees or with both.While imposing the punishment of fine for an offence under Sec 22 the Court shall take into consideration the amount of any compensation already awarded against the violator in any proceedings taken under section 20.

Thanks & Regards

V.Sounder Rajan -
Advocates & Notaries -Legal Consultants

E-mail : rajanassociates@eth,net,

-9025792684-9025792634
From India, Bangalore
Can someone shed bit more light on the exclusion clauses above from the definition of workmen?
What is "managerial capacity" for the ID Act? We are living in a world of mammoth enterprises that are bigger than many governments and have more than 10 levels of reporting hieararchy. It is silly to think that the ID Act doesn't cover everyone except the board of directors and those directly appointed by the board of directors of a company. This has no relevance to the salary or the nature of the job since technically everyone else will not be in managerial capacity in true sense.
If we take the view that everyone except the board of directors and their direct appointee to be acting in non managerial capacity then everyone else would be included as workman for the purposes of the ID Act, is it not?
From India, Hyderabad
Dear

Please the amended definition of workman under the Id Act :

The recent ID Act amendments for the Staffing Industry has enhanced the wage ceiling .

Prior to the amendment Wage ceiling of workman in the definition clause Sec 2 (s) was Rs. 1600/- .Now it is enhanced to Rs. 10,000/- per month,.

Consequently any person working in any industry doing any manual, unskilled, skilled, technical, operational, clerical or supervisory work drawing wages up to Rs. 10000/- will be considered as a workman. Workman definition now reads like this:

(s) "workman" means any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute, but does not include any such person –
(i) who is subject to the Air Force Act, 1950 (45 of 1950), or the Army Act, 1950 (46 of 1950), or the Navy Act, 1957 (62 of 1957); or
(ii) who is employed in the police service or as an officer or other employee of a prison; or
(iii) who is employed mainly in a managerial or administrative capacity; or
(iv) who, being employed in a supervisory capacity, draws wages exceeding ten thousand 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.

The exclusion is where the workmen employed in a supervisory capacity, draws wages exceeding ten thousand 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.

The Judgment of the Bombay High Court [attached ] .Specifically para 18 settles the issue. We are not having the information whether any SLP has been filed in the Supreme Court on the Bombay High Court decision .

You can refer to it and apply it on your facts.

rajanassociates
From India, Bangalore

Attached Files
Membership is required for download. Create An Account First
File Type: pdf 54_54_bombay_hc_on_workman_id_act.pdf (168.8 KB, 126 views)


Reply (Add What You Know) Start New Discussion






About Us Advertise Contact Us
Privacy Policy Disclaimer Terms Of Service



All rights reserved @ 2017 Cite.Co™