In a small size Engg design company, 8 staffs are employed under contract basis for 2 years (renewable on mutual consent). Under these circumstances what are all the eligible benefits applicable to them say any gratuity, PF, annual leave benefits, bonus etc.,

From India, Chennai
It is not clear whether or not you are enaged in manufacturing operation. However,they are entitled to all benefits as are admissible to regular workers/employees either Shops Act or under the Factories Act, as the case may leave, working hours, rest intervals, weekly off, festival and national holidays, over time etc..

From India, Mumbai
Total work force is 8 all of them are under contract. and company is not engaged in any manufacturing activities. Only Mech.Engg. Design with these 8 employees. Now as of now, all these contractual employees are availing governent holidays, OT, stipulated working hours, lunch break, incentives except Casual leaves, Sick leaves, EL. My question is are they eligible for SL, CL, EL since all of them are employed under contract.

From India, Chennai
and should we include them in the labour register also. regds Sami
From India, Chennai
It appears that your establishment comes under Tamil Nadu Shops and Establishments Act and thus the employees even on contractual basis are entitled to EL which is invariably provided by all Shops Acts and also to CL and SL If the said Act provides Casual and sick leave, you need to provide them also as the employees on contractual basis with you will also be treated as your employees.Since I am located in Mumbai, I did not go through TN Shops Act.

From India, Mumbai
Dear Sami,

I lend support to the presumption of Mr.Saikumar that the T.N.S.E Act,1947 is applicable to your establishment provided that the premises carrying on the activity of designing is not a notified factory under Sec. 85 of the Factories Act,1948 by the Govt. Having said that, I would like to elaborate the views of Saikumar little bit more academically.Basically, a contract of employment, I think, is a species of the genus of 'the contract' under the Law of Contract but with the exception for the implicit possibility of creating rights and obligations beyond the terms of the contract.In order to cicumvent this, always novel methods such as contract labour, fixed term employment etc., are employed by certain employers world-wide.That is the reason for the non-emergence of a Comprehensive Labour Code applicable to all systems and ventures of employment.Coming to your specific query, yours is an 'establishment' as defined u/s 2(6) of the TNSE Act,1947. Section 2(12) of the Act defines a "Person employed" to mean as a person wholly or principally employed therein in connection with the business of the establishment.When mach. eng. designing is the business of your estt, the people engaged to do the job in the same place will be the' persons employed' irrespective of their mode of employment.However, their eligibilty for the benefits you've mentioned is dependant on the tenure of their contract with your establishment.

From India, Salem
Dear Shri Umakanthan
you have very aptly explained the rationale behind this sort of arrangement of employment through a contract and the reason as to why the law on the subject in question is somewhat nebulous. Trust, your explanation of the of the definition of 'person employed' and his terms of employment under TNSE Act vis-a-vis his contract will set at rest the doubts of member queriest Mr.Sami. Thanks.
. .

From India, Mumbai
Dear Sami ji,
Just to add Shri Umakanthan ji, and Shri. Saikumar ji, in such kind of contracts i.e. contracts of fix term employment, you can not differentiate the employees from regular one. They are entitled to all the benefits as given to regular employees. There is direct relationship of employer and employee. All the labour law applicable to them.
The only difference is, in fix term employment you can terminate the service without assigning any reason which you can not do in regular employment.
In my view, fix term employment should be engaged in certain circumstances only, e.g. employment for particular project, employment on particular job or assignment which may be of particular duration and there is no guarantee of its' continuation.

From India, Mumbai

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