murugan_hrman
4

Administrative Officer
We have engaged contract labours in our factory for working 3 hours. We are giving PF, Paid Holidays, Bonus as per rule. our external auditor has raised the query that we have not paid leave with wages to contract labour. Please clarify that contract labour is eligible for leave with wages. Whether we have to give one day leave if he worked 20 days.
From India, Madurai
Yes Contract employee is eligible for Leave with Wages.....If you are covered under Factories Act then you have pay Leave with Wages One Day for 20 worked Days....
From India, Pune
[email protected]
24

HR Consultant
Hi,
Yes, the contract employee Is eligible to leave, depending upon the establishment he is working with. It may be a factory, mine, commercial establishment, or plantation. These legislations include a person employed by or through a contactor as a "worker".
Whenever examining eligibility to any benefit like provident fund, gratuity, or workmen compensation leave etc, always look to the definition of worker/employee/workman, under the applicable legislation.
Cyril

From India, Nagpur
Hello,

I somewhat differ with the view expressed above. There is provision of separate treatment for workers whose work is casual/temporary in nature. Given below is the detail.

Casual employee entitlements

Casual employees are entitled to a casual loading for every hour they work. This loading compensates them for entitlements they donít get such as paid annual leave and paid personal leave. Casual employees may also receive a higher rate of pay for work performed on a Saturday or Sunday.

Visit Finding the right pay for tools to help you calculate your casual employees minimum wages, including the casual loading and penalty rates.

When rostering your casual employees, every shift has to be at least 3 hours. If your casual employees work shifts that are less than 3 hours, they still need to be paid for 3 hoursí work.

Note: under the Retail Award, some casual high school students can work for a minimum of 1.5 hours. For more information and to find out who this applies to, visit the Hours of work section.

Check clause 13 of the Retail Award for more details about casual employees.

If you or your establishment agrees, OK. Otherwise, more expert opinions may be obtained.

Best wishes

Arun Jain

HR Personnel

NCL, CIL

From India, Jabalpur
Dear Sir,
Contractor employees are not our employees. They can claim any statutory benefit from their employer (who is contractor with you ) and you will make payment in terms of agreement as entered by you with the contractor.
Your duty is to ensure compliance of statutory provisions relating to employees deputed with you by the contractor. If any contractor employee complains you, you ask the contractor for compliance and if any payment is made in this regard, same is deductible from the contractor-bill.
Thanks
V K Gupta

From India, Panipat
Leave with wages is the provision of Factories Act, 1948. Contract Labour being 'Worker" as per the definition are eligible for the Leave with wages provided they fulfill other criterion.
other criterion is they should have worked 240 days or more, if this condition is fulfilled they are eligible for leave with wages.

From India, Pune
Employment Lawyer
61

Lawyer & Consultant
Contract labour are eligible and the employer is liable, it is already described to you in the above replies but what is important here is if they are given all these benefits by their employer - the contractor as they are essentially his employees, but if the contractor has not given them these benefits then the principle employer - that is your company becomes liable. Also have in mind that if they seek regularization then all these benefits given by your company directly will come in handy for them to prove that they are basically your employees and that the contractor is just on paper. Is your company already paying their ESI & PF directly is a yard stick to begin with. Its a tricky subject and I am not saying that they WILL get regularization as a thumb rule, there are lot of other issues involved too, but you need to see this as a possible future repercussion, so its always safe to disburse these benefits through the contractor and not directly from your company, in such case your auditor will not have any issues too.

Regards,

From India, Chennai
Prasad62
17

HR professional
Arun ji:

I am curious to know more about this...

Can you please provide any specific reference, link, sections of relevant laws? Will be much obliged....

I also did not understand the Retail award... To whom it applies? Where can I find the text?

Warm regards

Prasad

QUOTE=Arunjain.ncl;2080305]Hello,

I somewhat differ with the view expressed above. There is provision of separate treatment for workers whose work is casual/temporary in nature. Given below is the detail.

Casual employee entitlements

Casual employees are entitled to a casual loading for every hour they work. This loading compensates them for entitlements they donít get such as paid annual leave and paid personal leave. Casual employees may also receive a higher rate of pay for work performed on a Saturday or Sunday.

Visit Finding the right pay for tools to help you calculate your casual employees minimum wages, including the casual loading and penalty rates.

When rostering your casual employees, every shift has to be at least 3 hours. If your casual employees work shifts that are less than 3 hours, they still need to be paid for 3 hoursí work.

Note: under the Retail Award, some casual high school students can work for a minimum of 1.5 hours. For more information and to find out who this applies to, visit the Hours of work section.

Check clause 13 of the Retail Award for more details about casual employees.

If you or your establishment agrees, OK. Otherwise, more expert opinions may be obtained.

Best wishes

Arun Jain

HR Personnel

NCL, CIL[/QUOTE]


I disagree with Mr. Arun quote. Contract labour working within factory is eligible for Earned Leave, as claerly elaborated by Mr. Narendra Rawal, Leave with wages is the provision of Factories Act, 1948. Contract Labour being 'Worker" under the Factories Act, are eligible for the Leave with wages provided they should have worked 240 days or more.
We are unable to undrstand the terminology being used i.e. Casual loading, Retail Award, Casual high school student.
It would be great if you could quote some releavant statutes and section so that we can enrich our knowledge.
regards,
Manvendra.

From Germany, Frankfurt
lokender.k
Sr. Manager - HR & Admin
Contract labour falls under definition of "worker" in The Factories Act, 1948. Hence they are eligible for "Leave with Wages".
Their contractor should extend this benefit to them, but being principal employer you will be finally held responsible if compliance is not done.
Thanks,
Lokender

From India, Gurgaon

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