Partner - Risk Management
Ashutosh Thakre
Hr Professional
Hr Officer
+3 Others

Thread Started by #Saptarshi

Dear All,

1. As per Factories Act, u/s 79 any person who has worked for 240 days is entitled for leave benefit.

2. In case there are 02 units, unit A and Unit B and both are separately registered with different occupiers then as per act both this units are considered as separate factories.

3. Now an Agency has been engaged to provide security service to both the units (i.e. A & B). There are cases of overlapping duties whereby few security guards have done duties in Unit A and also done the reliever duties in Unit B. Separately these guards fails to make 240 days in a single unit but if clubbed together they have done duties more than 240 days. For eg.

Security Agency : XYZ

Engaged for both Unit A and Unit B

One Security Guards Duty details:-

In Unit A : 210 days

In Unit B : 70 days

Which means individually in none of the units that guard has completed 240 days to get the eligibility but in case we sum up both the units he has done duties of 280 days.

4. In the above case can the security guard will get the leave benefit under the factories act in case,

(a) Both the units are separately registered with separate licenses AND SEPARATE OCCUPIER.

(b) Both the units are separately registered with separate licenses AND SAME OCCUPIER.


30th September 2015 From India, Delhi
Dear Saptarshi,
First of all the Security has been outsourced, so you as a principle employer have no control over their holidays or leaves. They as a employee of that security company have cleared the 240 days mark, so they are eligible for leaves... Your contract with the agency would be on Manpower basis, so another reason for you to worry less. The Agency would have to substitute a person for the person taking a leave.
And lastly, The security is covered by the Guard Board and not by Factories Act.
Ashutosh Thakre
30th September 2015 From India, Mumbai
First, the author is in delhi, so I assume the two units are not in Maharashtra.
Guard board act is a state legislation that only applies to the state of Maharashtra.
Definition of worker in factories act covers every person in the factory excluding the occupier and factory manager. So the contract workers are covered under the definition of workers.
Second, the principal employer is liable for all non compliance of the contractors, so if the contractor does not give the paid leave, the principal employer is liable both under factories act and under payment of wages act. Therefore he must monitor and ensure that proper paid leaves are granted.

30th September 2015 From India, Mumbai
There are 2 approaches here.

Going by the ethical approach and the spirit of the law, the security guards are entitled to paid leave. I think the wording of the act says any worker who has worked for more than 240 days, it does not say 240 days in the same factory. So since both units are under the same company, the leaves would be required to be granted. Supreme Court has declared that labour laws must be given broad interpretation in favour of the labour.

Further, the actual employer is the same, so you need to ensure that his employees get the paid leave they are granted under law.

The second approach is the legal approach. There how you interpret the various provisions of the act and their interplay drives what the court decides. So if you are looking to avoid paying for leave, then speak to your lawyer and see if he is confident of being able to defend it in court. Ofcourse, it all comes up if someone makes a complaint.

However, do remember that defending such a case has a cost. The cost in lawyers fees probably makes the savings look shallow. So if you are going by the second approaches its how good a lawyer you have, how much of risk appetite you have. I can not predict which way the courts will take a call.

30th September 2015 From India, Mumbai
I like your reply.
Why should people play around with law to find out how to deny a guard leave saying you have not worked 240 days in single unit??
Management should be broadminded and welfare oriented and grant leave taking the spirit of the regulations/laws.
30th September 2015 From India, Pune
If double duty is on the same day you are violating section 60 of the Factories Act 1948.Otherwise the practice is legally correct as far as annual leaves eligibility is concerned but ethically wrong.
30th September 2015 From India, Thiruvananthapuram
As per factories act : Employee means regular ,casual and contract worker. So it comes under purview of factories Act.
30th September 2015 From India, Madras
You Will be surprised at how petty lower and middle management are about such things.
Dave will try to save as much as they can at the cost of the workers, even where there is no material impact. In fact, managers take pride in showing such small savings as their contribution to the company's bottom line.
I have pointed out similar things in terms of paying overtime rates also. In most manufacturing units, labour cost is not more than 10% of the manufacturing cost. Overtime will not be more than 20% of that. The net effect of both together therefore would be 0.20%. There are two very few units that are operating at margins that will be affected by .2% increase in cost. But still companies continue to pay overtime at double of basic plus DA when it is very clearly stated in the law that it should be double of gross wages
So, yes, most management are unethical in their approach

1st October 2015 From India, Mumbai
Reference to all the above replies, I would like to thank all for sharing your views. However I would differ with your views of concluding things like Management is not interested to pay. We are a public sector undertaking in West Bengal and as I understand the intention is not to play around with the dues of contract workmen's, rather to pay dues which are only legitimate and legally viable. The guidance I required on the ground that whether the payment would be viable as per Factories Act as there is 02 different Form 15 under 02 different Occupiers. Because something which seems practical administratively might not be viable legally. Because end of the day any payment made is subject to Audit and any such dispute needs to be justified properly as in our case being a PSU things will be audited by CAG.
Hope things are clears
1st October 2015 From India, Delhi
If both factories belong to your company, and the guard was working for different factories of your company, what ground you have to allow his leave to be denied ? Other than some technical hair splitting of course.
Even if the second factory is not yours, but you know the guard worked there, you are still obliged to ensure he got his legal dues, which includes paid leave as per law.
2nd October 2015 From India, Mumbai
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