In Group 4 Securitas Guarding Ltd. & Another vs. Employees’ Provident Fund Appellate Tribunal & Ors., 2012 LLR 22 the Delhi High Court has held that where the contractor, being employer providing services of man-power, is having control over the personnel being supplied by him to the establishments by way of issuance of appointment letters, making payment of wages and other allowances, taking disciplinary actions, effecting their placement, transfer and termination of services, the relationship between such a contractor and the establishment where the man-power is supplied by him would be of ‘principal to principal’ and not that of employer-contractor.
i) Since the drivers had resigned their jobs they could not be said to be employed in the Motor Transport undertaking. The word ‘employed’ in the definition of Motor Transport Act. Worker is not used in the sense of using the services of a person but rather in the sense of keeping a person in one’s service. Persons who are independent and hire a vehicle for their own operation paying a fixed hire per mile from their earnings cannot be said to be persons employed in the Motor Transport Undertaking in the sense of persons kept in service. The operators were therefore not Motor Transport Workers within the definition.
(ii) There was no bar in law to the introduction of the con- tract system. A person must be considered free to so arrange his business that he avoids a regulatory law and itspenal consequences which he has without the arrangement, no proper means of obeying. This, of course, he can do only so long as he does not break that or any other law.
(iii) Those who resigned did so voluntarily and they got substantial benefits under the new system.
(iv) The Tribunal was right in its conclusion that there was no exploitation of the ex-employees. There was thus no unfair labour practice. The present case was not analogous to the case of contract labour when employment of labour through a contractor or middleman put the labour at a disadvantage in collective bargaining and thus robbed labour of an important weapon in its armoury.
..... to be contd
HR & Employment Law Attorney
Specializing for Recruiting and Contract Staffing Industry