Re: Principl Employer Vs Occupier - CiteHR
Umakanthan53
Labour Law & Hr Consultant
Harsh Kumar Mehta
Consultant In Labour Laws/hr
Nathrao
Insolvency N Gst Professional
+2 Others

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Just want a broad differentiation between principle employer and occupier .Please help me clear this confusion thanks
Sir,

In legal terms, the words "Principal employer" or "Occupier" have been defined differently in various labour laws legislations viz.-ESI Act, Industrial Disputes Act, EPF & Misc. Provisions Act and The Factories Act, 1948 etc. Perhaps, different meanings and assumptions of such terms have been adopted in various Acts keeping in view the purposes of such enactments. Some of the enactments have adopted the definition of "Occupier" as mentioned in Section 2(n) of the Factories Act, 1948.

In common language, in my opinion, we can say that the employer means the owner of the establishment viz.- Sole Proprietor, Partner, Managing Partner, Director, Managing Director etc., whereas the word "occupier" has a wider meaning and will also include the officers of such employers having ultimate control or the authority of the factory/establishment viz.-Manager, Executive Manager, CEO, or any other person by whatsoever name the same may be called.

As and when the question arises in any legal case regarding civil or criminal liability in any labour laws, the definition of above words as provided in the respective laws is relevant.

h k mehta have given the elaborate clarification regarding this.
In my view principle employer means overall responsible person regarding ownership as well as implementation of all relevant acts such as income tax, commercial acts including to the occupier's responsibility.
But the occupier is responsible for only factory related acts such as factories act, esi, etc.

An apt answer by H.K.Mehta! However, let me please elaborate. The term " Principal Employer "occurs in the definition clauses of the Employees' State Insurance Act,1948 [ Sec.2(17) ], the Beedi and Cigar Workers ( Conditions of Employment ) Act,1966 [ Sec2(m) ] , the Contract Labour ( Regulation and Abolition ) Act,1970 [ Sec.2(g) ] and the Inter-State Migrant Workmen Act,1979[ Sec.2(1)(g) ]. The term " Occupier "occurs in Sec.2(n) of the Factories Act,1948, Sec.2(15) of the ESI Act and Sec.2(k) of the EPF Act,1952. The term 'occupier' was employed and defined for the first time in the erstwhile Factories Act,1934 and adopted in the present Act and other enactments such as the ESI and the EPF Acts.We cannot find any term defined in the Factories Act to convey the meaning of provider of employment other than ' Occupier ' in juxta-position with the definitions of 'mnufacturing process', 'worker' and 'factory' for the reason that it is an establishment-oriented labour legislation.On the contrary the ESI and the EPF Acts are Social Security Labour Legislations and the CLRA and the ISMW Acts being regulatory labour legislations having applicability over all industrial establishments wherein the engagement of direct and indirect labour is possible, it is imperative to use certain qualified terms for employer to fix vicarious liability for effective compliance.
Dear Learned members,
Please clarify if Canteen Licensee could be treated as occupier as he has been provided license to operate (with profits). This point is being raised so that maintenance of equipment could be maintained by Canteen Operator.

As far your query about canteen licensee being treated as occupier is concerned.
Please refer definition of occupier in sec 2(n) of Factories Act.
For eg
An occupier of factory may be an owner, a lessee or a mere licensee but he must have the right to occupy the property. He should also control the management.
Does your licensee fulfil these conditions.??
I doubt it.
Your canteen may be a part of a factory I presume??
So read these Acts properly and you will get answers.

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