Habib Rahman

I kindly require on the condition of 240 days working of contract labour. We have engaged contract labours through labour contractor. They are engaged in the similar kind of process that of our regular on roll workmen. My query on the same is , Can a contractor labour claim permanency if the period of work inside our company is >240 days.
Anticipating guidance and insight on the query.
Thanking in advance.

From India, Rajkot
Labour Law & Hr Consultant
Sr. Hr Executive
+2 Others


No. By efflux of time, contract labor can not claim permanency against the principal employer unless the contract is proved to be sham in industrial adjudication.
From India, Salem

This thread may be of use to you: https://www.citehr.com/429346-after-...permanent.html
From India, Chennai

Umakanthan Sir, Kindly elaborate in simple and easy understandable words. Regards,
From India, Jaipur

The contractor workmen can not claim the employee of principal employer. The work of workmen is valid till the contractor licence under CL (R&A) is eexist or till the work order issued to contractor, whichever is earlier. Working of 240 days does not sanction any such guarantee to absorb under principal employer.
In absence of licence under CL (R&A) by the contractor provides oppurtunity for such claim. The blunder has done by you to engage contract labour in the similar kind of process where your regular on roll workmen.
Now your turn is to end-up the contractor enagement in that work of contineous nature/core work of the company, before the calim takes diffrent shape.
In eye of law this type of contract is viewed and declared camouflage or sham contract. Hope this will address your querry in total.

From India, Mumbai

Dear HR PROF.,
Engagement of Labor through a contractor for the works of an establishment is called as Contract Labor System. Essentially, it is a system of indirect Labor involving three parties viz., the principal employer, the contractor and the contract labor out of a contract for service entered into between the PE and the contractor. As such there is no contractual relationship between the PE and the contract labor though the latter works for the former. But, employment is a substantial relationship of Employer - Employee formed under a Contract of Service. Therefore, no contract labor can stake a claim for permanency against his PE just because he has worked in the PE's establishment for more than 240 days when the contract between his contractor and the PE is a genuine one.

From India, Salem

Its fact that Permanent workers does not gives their desired output and Shop floor engineers don't have much control on them also. In this situation, contractual workers are also deployed on core operations to meet the production target.
"Same work, Same pay" is emerging as a serious IR issue.
How to handle this issue, when being raised by Contractual workers.

From India, Jaipur

Addition to above given comments :
Contract employee can surely ask for the permanency at work only in case if the contract proven to be a SHAM contract. Contract can be a SHAM contract if the work is directly assigned and supervised by the company or company employee as supervisor or their attendance and salary records are been maintain by the employer. These are few of examples which may turned around the contract to the SHAM contract thus please first of all verify your contractual relation with the contractor and contract employee which will surely gives you an idea if this will applicable to the contract employee or not.


Absolutely NO. In principle (as per the decision of various High Courts and Apex Court) the contract workers cannot claim permanency. If the contract is SHAM and if there is an existence of master and servant relationship between the workers and the Principal Employer the workers claim for permanency will stand before the eye of law.
In order to determine the existence of master and servant relationship and as to when it can be termed as a SHAM contract the Karnataka High Court in the case of Management of VISL –Vs- Presiding Officer reported in 1994(69) FLR 536 has given the following tests to be applied.
1. Who pays?
2. For whose benefit the workmen work?
3. Under whose supervision?
4. Whether disciplinary action can be taken?
5. If so, by whom?
6. Has the employer the right to reject the end product?
S. G. Management Services
(PAN INDIA Consultant – Labour Law Compliance,
PF, ESI, P Tax, Benefit Management &

From India, Kolkata

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