Will Fixing A Minimum Wage For Contract Labour Resolve Labour Market Issues? - CiteHR
Umakanthan53
Labour Law & Hr Consultant
Madhu.T.K
Industrial Relations And Labour Laws
Pbskumar2006
General Manager-hr
Hotgautam
Hr Manager
Gaurav.HRM
Manager-hr
+4 Others

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Dear Seniors,
As you know, The Labour Ministry has proposed a minimum monthly income of Rs.10,000 for contract workers.
please give your views on -
Will fixing a minimum wage for contract labour resolve labour market issues?
Regards
Gaurav

Dear Gaurav,

In the first place, Yours is a thought-provoking question as it presupposes a firm conviction that the fixation of minimum wages exclusively for contract labour and its periodical revision alone would neither solve the problems of contract labour as a less-privileged class of labour nor eradicate the menace of contract labour as a system of indirect employment.

If any activity of business, trade, commerce, manufacture or analogous thereto is perennial in nature, it requires a labour force for hire that has got the feature of regularity in terms of attendance, working hours, leave and holidays, payment of wages, methods of work, control and supervision by the employer, tenure of employment etc., thus creating a direct and implicit nexus or a long-lasting relationship between the employer and the persons employed which is otherwise called as the contract of service. In short, this is what is called as the system of direct labour that is employed on the core activity of the establishment.. Still there may be certain other activities which are incidental to the main activity and last for a limited duration of time involving no skill or altogether different type of skill and hence no supervision of the employer.When some people are engaged for such activities that is called casual employment which is only ad hoc. How ever, when such incidental activities require more no of people and considerably last longer, in order to ensure their timely mobilisation and supervision, the assignment is given to a third person simply in terms of the results to be produced by means of a time-bound agreement or contract and the labour engaged therein are called contract labour which is nothing but a form of indirect employment just because of the presence of an intermediary. Thus the contract labour has two employers i.e the immediate employer who is the contractor and the principal employer for whom the contract labour have to work.So far so good.

But the real problem arises when the contract labour are shifted to the core activities of the establishment purely for reasons of economy, higher bargaining power of regular workforce because of their unionisation, flexibility of employment in tune with market conditions etc. Though the Contract Labour ( Regulation and Abolition ) Act,1970 has stringent provisions, the lack of political will has resulted in its diluted enforcement. The difference between core and incidental activities are practically not at all taken into consideration now a days in the engagement of contract labour. Engaging contract labour in any activity other than those prohibited u/s10 of the Act has become the normal practice.

In this context, whether the proposal to raise the minimum wages of the contract labour to Rs.10,000-00 will serve any useful purpose seems to me doubtful. Already minimum wages are fixed scheduled employment-cum- post wise without any distinction as to the nature of employment such as permanent, temporary etc. Therefore, contract labour are also entitled to the minimum wages in force. If the minimum wages are fixed exclusively for contract labour as a distinct class without reference to the job done by them, it may be lesser than the rate fixed for a particular job in the establishment or industry. So, let's wait and see the notification.

Minimum wages are fixed for each kind of work and each scheduled employment. There is no scheduled employment called contract labour. Suppose that all contract workers are brought under one scheduled employment, viz, contract labour, and fix the minimum wages for that employment as Rs 10000 per month, that will be the wages payable to all who are hired through agencies or contractors. Now we have separate minimum wages based on work, say minimum wages for security guards, minimum wages for housekeeping staff etc. If the proposed amendment to the CLRA Act is enforced then there can be a chance that the housekeeping staff engaged through contractor will get wages of Rs 10000 and those doing the same work but employed directly by the (principal) employer will get say Rs 7000, being the minimum wages as applicable to housekeeping staff. I don't think that this is fair.
Madhu.T.K

I agree with the comments of both Shri Umakanthan & TK Madhu Sirs.
In fact, if the Govt. were to fix Min.wages of Rs.10,000 for CL engaged thru the Contractor, there are hundreds of direct employees in several Cos. who will be drawing less than Rs.10,000 & there will be heart-burning. Even with periodical increments/revision, there are many Unskilled to Skilled employees drawing 5-7000.
A thorough scrutiny of Wages/Salaries, benefits given to all types of employees have to be reviewed before fixing only for Contract workers.
c.neyimkhan 5.5.16.

Kindly can anyone confirm if any objections has been raised against the said contract labor minimum wage notification
Dear Friends,
Mr. T.K. Madhu & Mr. Umakanthan is well explained the fixation of wage for contractor labour Minimum Rs. 10,000/-. In fact the wage in some cadres in the notification are getting more wages. This ten thousand is for un-skilled (Cental Labour) only. So far no objections were raised by any of the Trade Unions. But now the state Govt. may face problem if the Trade Unions to demand to extend the same to State level Contract Labour.
Regards,
PBS KUMAR

Hi, I need Karnataka minimum wages for 2016-17 for construction workers. Can anybody provide this for me. Thanks in anticipation Maqsood Technoart Constructions Pvt. Ltd. Bangalore
My understanding is that the proposal is not to make it applicable to central level employees but to amend the CLRA (Central) Rules so that the same will cover all the states. Madhu.T.K
Enforcement of statutory wages rather fixing wages for contract labour is more necessary. Online payment method should be strictly enforced in place of direct payment so that contract labour gets what the principal employer is paying to the contractors.
Government is revising wages, Bonus, PF and ESI, Minimum wages to working class from time to time. But many organizations are not following. It is a known fact.
The Govt. is not bothering for its strict implementation.
Going to Courts, Authorities is laborious process. Justice is not being done. Late process. Then what for the the Govt. is revising all these are nobody knows?
The Govt. should ensure that wages,Bonus,Min.wages should be paid through Bank and the payment should be checked by the officials in every month.Dispute Redresel process should be quick (3months).
If sincere efforts are taken, then it will be useful to the working class,improvement of productivity,reduces disputes, economy will increase. Industrial Peace and prosperity will take place. Working class will be more happy. Otherwise it is a waste.


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