Compensation for Contract Worker - applicable under Employee Compensation Act? - CiteHR
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I am contractor gets contract of 171 nos contractual worker deployed at principal employer establishment has completed one year of service with almost good faith paying all the dues like monthly wages Pf, ESI and leave wages as per our agreement between us.
principal employer is reputed organisation under govt. and earned huge amount of profit after getting service of contract employees .
as per my contract with principal employer i have got a very little amount of service charge.
Now at this stage who will be pay the Bonus to 171 contract employees ?
Please suggest & clarify as per the Bonus Act.
Nirmal Mohapatra

Bonus as per the payment of bonus act is based on the allocable / available surplus of the employer. As a contractor you are the employer and based on your profit you have to pay bonus. However under Payment of Bonus Act, the employer has to consider payment of bonus to his workmen only after completing the 5 years period. From the sixth year on words based on the available surplus, after set of / set on all the losses made earlier five years period.
It is very common with many Contractors. You are providing service against the service charge and if it includes Co's contribution of PF, ESI, Bonus, Gratuity etc. - then it is your responsibility. If it is not, then in the agreement between PE and Contractor, it should mention that all statutory payments are the responsibility of PE. (Moreover, As per your version you are getting little amount of service charge.)
Based on your agreement between you and PE , you have to take a call.
The healthy agreement between Contractor and PE may be (Monthly gross + Employer portion of PF & ESI) + Service charge of contractor +GST as invoice amount.
Periodical payment - Bonus, Gratuity, Leave pay etc . may be claimed by the contractor with little service charge from PE and paid to contract labour.
It is also essential from PE to control on different statutory payment made by the contractor and for proper partnership relation to provide necessary support to Contractor.
S K Bandyopadhyay ( Howrah, WB)
+91 98310 81531

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