To avoid this kind of obligations, you can start deduction of certain amount to reduce this kind of risk. you can cultivate those amount in some circumstances like late payment of salary, non payment of salaries and non payment of PF or ESIC dues.
18th July 2013 From Singapore
According to section 21(4) of the Contract Labour (R&A) Act, 1970 Principal Employer is responsible to make the payment of wages in case the contractor fails to make the payment in time to the workers employed by him. PE will recover the amount so paid as per the procedure laid down under this Act. Section 21(4) of this Act may be read as under.
21. Responsibility for payment of wages:—
(4) In case the contractor fails to make payment of wages within the prescribed period or makes short payment, then the principal employer shall be liable to make payment of wages in full or the unpaid balance due, as the case may be, to the contract labour employed by the contractor and recover the amount so paid from the contractor either by deduction from any amount payable to the contractor under any contract or as a debt payable by the contractor.
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18th July 2013 From India, Delhi