Madhu.T.K
Industrial Relations And Labour Laws
Saptarshi
Hr Officer

Thread Started by #Saptarshi

We are a central psu and appropriate government in our case is Govt. Of India. Thus any contractor working with us need to pay minimum wages as per central rate. A big house (IT co.) has engaged few manpower for networking job is paying wages at par with state rate ie min wages at per with Govt of WB. Further they are also bifurcating the minimum wage in basic and other allowances. As per my knowledge i have opposed on such act and had asked them to pay wage as per central rate and not to bifurcate the same. Need your guidance on the same.
Rgds,
DG
19th September 2013 From India, Delhi
The main thing to be considered is whether this contract is a contract of service or contract for service. If the IT company has been awarded work of laying LAN cable and commission it to your satisfaction and in that if price charged is all inclusive, ie, including cost of wires, connectors, RJ, Ports etc, then it should be considered as contract for service; that we are getting a service, just like purchasing a product from the IT company. In this contract there is no direct supervision involved and therefore, the provisions of CLRA Act will not be applicable. As such we are not principal employer but only a buyer and therefore, we need not look into what the supplier pays to his employees etc.

On the other hand, if the IT company is just giving you workers who do their job according to your directions using cables, connectors etc supplied by you, then you will be in the position of a Principal employer who will be responsible for ensuring payment of minimum wages and other statutory contributions. If so, certainly, the Contractor (IT Company) will not have any problem because whatever they pay will be put on your shoulder and if you want that their workers who work in your undertaking should be paid higher wages (as per Central Minimum Wages notification) they can pay so and charge it you. Similarly, if you say that the contractor should not bifurcate salary but should pay PF and ESI on the whole amount, they can follow you and charge the additional amount of PF and ESI from you. As far as the contractor who is registered under the State's Shops and Commercial Establishments Act is concerned, whatever is applicable to employees in shops and establishments is applicable to him also and there is nothing wrong in his act of paying the same salary to the workers he has engaged in a central PSU as is paid to the rest of his employees. If you are ready to pay more as service charges, he will also pay wages according to your rules.

Madhu.T.K
19th September 2013 From India, Kannur
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