Labour Law & Hr Consultant
Srf Ran Engineer
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At first place it shall be the contractor and not you (Principal Employer who should decide wages or increment for this office boy. All you are required is to ensure compliance with all applicable legal requirements i.e. min wages, PF, ESIC etc.
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The increase demanded by the contractor may be in tune with the hike in the variable dearness allowance fixed under the statutory minimum wages consequent on the rise in the cost of living index. Some State Governments prescribe the revision of V.D.A fixed under the Minimum Wages Act,1948 once in six months. As P.E, you have the vicarious liability towards payment of statutory wages to the contract labor engaged in your establishment u/s 21(4) of the CLRA Act,1970.
Let the contractor give him increment every month, you need not worry, if you are complying with the Statutory requirement. (Also check your contract / agreement signed by both the parties).