Hello All, Could any one guide me that what is the rules of leave for contract employees. Also requested to you to share the circular ,section & rule no against this. Thanks & Regards Pankaj Kr. Das
From India, Gurgaon
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All workmen/employees engaged through any contractor are worker/workmen/employee under relevant provisions of labour legislation. They are governed by same rules as are applicable to other workers/workmen/employees in respective law.

For example a worker in Factories act includes contract worker as well and they are eligible for one day paid leave for 20 days worked, They also must have completed 240 days or 2/3 rd of the working days.

Similarly the provisions in shops and Establishments act are applicable in such establishments where contract employees are engaged

Similarly National and Festival Holidays are applicable to them as well.

If an organisation is extending more benefits, then those benefits need not be extended.

Contract workmen are eligible to all statutory benefits. The only difference between a contract workmen and regular employee is that the benefits over and above the statutory benefits extended to regular employees are not applicable to these employees.

Even this interpretation is not 100% correct as there are many employments which are banned by concerend State Govts from engaging contract workmen.

From India, Chennai

Dear Mr. T.Sivasankaran,
Thanks alot or your guidence.I have one another query please suggest and share if any circular or rule for this??
"A contract employee have right or can appeal for permannent job with principal employer after some period of continue service as contract employee under principal employer."

From India, Gurgaon

Very difficult but interesting question to deal with. More than the legality involved in this question, I always highlight the ethical issue involved. I can recall my interaction with my Managing Director of one of the well known Companies of Tata Group regarding engagement of contract workmen. When I was talking to him about the legality, he spoke with me the ethical issues and reminded me of my role in maintaining values and ethics the group is known for.Even assuming you have a strong case to employ contract workmen, if it goes to extend of exploitation, then you will see results as was seen in Maruthi.

Legally, if an employment has not been prohibited by State Govt for employment of contract workmen, then the Company can engage contract workmen and they have no right to claim permanent status with Principal Employer.However, if the employment has been prohibited, he can claim permanent status .

I would always recommend in a manufacturing set up to maintain around 20 percentage contract workmen and 10% temporary workmen paying them the minimum wages. If vacancies arise, give these employees due credit in calling them for interview. Let me also caution that this is an area where nepotism and malpractices are at the highest in factories.

I may not have answered completely your query, but I hope this would have given some insight

From India, Chennai

good evening to all the above case is for factory workers. what will be the leave rules (PL/EL/SL/CL) for contract employee engaged in any office establishment? Plz advise. With regards Akash
From India, Ahmadabad

Please check Gujarat state shops & establishment act/rules for your guidances.(Though there is no separate Gujarat Act, the Bombay Shops & Estt. Act 1948 applies to Gujarat as well.) The Gujarat Government indicates that establishments that are not covered under the factories act have to be registered under the Shops & Establishments Act.
The gist of the act is attached for your ref.

From India, Bangalore

Attached Files (Download Requires Membership)
File Type: doc Bombay & Gujarat shops & estt.act. Labour Laws.doc (39.0 KB, 1002 views)


Dear Mr Sivasankaran,
I am working in a central crpn turned a wholly owned govt of india ltd. company.For last couple of years we have started recruiting contract rated staff doing the same job done by permanent staff.However such contract staff get only 8days holiday for religious/national festivals whereas the permanent staff get 15 such holidays.Is it legally correct ?

From India, New Delhi

Which State is that? Festival Holidays shall be 5 and National Holidays in some states are 3 and in some four . Sometimes, Natinal Holiday might fall on Sunday. In such case, you need to make payment. To my knowledge the aximum Holiday allowed is in Keral and if I am right it is 12 or 13. In many states it is 9. Originally the Act started with 8( 5 National Festival Holidays and 3 National Holidays) Some State later on added May Day making it 4.
Please tell me the State and you will get the right response

From India, Chennai
@ T.Sivasankaran
Thanks for sharing your views.
Actually I am in the same situation i.e on third party payroll which has ended up in Jan 2013
but still there is no communication between the company and third party co.
Is it necessary to get the person on the roll when there is appraisal going on or whenever the contract period ends.
Please guide me as I am very confused.

From India, Pune

Mr Sivasankaran,
Although I am in West Bengal but our operations are all India basis and the number of national holidays are same.Only the festivals are different.For example Onam in Kerala and Durga puja over here.Can it be as a result of management/union agreement ?

From India, New Delhi

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