Umakanthan53
Labour Law & Hr Consultant
Madhu.T.K
Industrial Relations And Labour Laws
Nagarkar Vinayak L
Hr And Employee Relations Consultant

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If an Employee who is on contract from 3 years with the principal employer itself. Also the employee is given a break period of 4 days in between the contracts. Now when the employee is made permanent, does the break apply in such a case. The contract employee is on payrolls from the time his first contract began.
Now the question is do we need to give a 4 days break or can the employee be given a letter stating he is permanent from the next day of the contract end date:
for eg: an employee completing his 3rd year contract on 31.01.2020........does he need to be given a 4 days break i.e. 01.02.2020 - 04.02.2020. or can he be made permanent from 01.02.2020...Please advise.

From India, Mumbai
In all probability, the poster needs clarification regarding the effective date of permanency of a Fixed Term Contract Employee and not about any contract labor engaged through a contractor.
As per the amended IE(S.O)Rules,1946, all the statutory benefits available to the regular employees of the industrial establishments should be given to the FTC employees also in proportion to the period of service rendered by them.
Therefore, if the FTC employee was given all the terminal benefits like gratuity, leave encashment etc., on completion of the three year contract period, his subsequent appointment as a regular employee would be effective from the date of joining afresh only.

From India, Salem
This is not a case of Contract Labour but a case of Fixed Term Contract employment. Giving 3 days of breaks in between two term will not serve to be interrupted service in the eyes of labour laws. An employee who has worked for 240 paid days (days including weekly off days, holidays and leave days for him salary has been paid) over a period of 12 months is considered to be eligible for all rights, leave with wages, retrenchment benefits, gratuity etc. When such an employee has been taken on regular rolls, ie, permanent rolls without mentioning any fixed periods, a letter/ office order which is given to candidates appointed on regular rolls shall be given. You need no wait for four or five days but can serve his letter immediately when he FTC ends. For all purposes, his date of joining will be he date on which he was first appointed on a fixed term contract.
From India, Kannur
Dear Madam,
Here you have an employee on contactual basis for 3/4 years with 4 days' break in service during the employment and now you want him to take on permanent roll of the company.
The question of giving his contractual employment period the continuity of service here does not arise as presumably you, after each break, would have settled his all dues including gratuity etc.
If you have , each period is considered as fresh contract of employment.
By giving break in service, you obviously intended not to give him continuity of service.
It would be consistent , if now also you pay him his all dues and take him on company's pay roll as fresh employee on permanent basis from the date of appointment, without continuity of service
However, giving him continuity of service is entirely up to your HR policy and legally nothing bars you.
Regards,
Vinayak Nagarkar
HR and Employee Relations Consultant

From India, Mumbai
Mr Vinayak, let me say that even if there is a fresh appointment order at each time, the employee remains the same. Issuing fresh contract of employment year after year and engaging the employee on a job of permanent nature should be considered as an unfair labour practice as per ID Act. Moreover, with every change in contract the employee remains the same. Various Court verdicts including some from the Supreme Court say that fixed term contract employees are also eligible for gratuity. When there are ruling that the period of employment of an employee who had a period of service as a casual worker should also be counted for deciding the eligibility and amount of gratuity, the question of non eligibility of an employee who has been working continuously under a legal document (contract of employment) does not arise. He should be eligible for gratuity once he completes fie years including the FTC period.
From India, Kannur
Dear Madhu T.K
No where I have stated that contractual or FTC appointment with breaks should be resorted to as a rampant practice to deprive employee of permanency.
My views as well as Mr Umakanthan's were on the presumption that the concerned employee was on FTC basis. FTC ,as you know, is largely resorted to project employment where the length of employment is determined based on project period. Any employee can be hired on FTC basis for differing periods and for different projects and his dues can be settled at the end of each project period including gratuity . I do not see any element of unfair labour practice as the law has recognized the need of FTC basis for project employment.
Here the poster needs to clarify whether it is FTC appointment and whether dues were settled for each term of FTC period.
If gratuity and other legal dues were settled each time, then his engagement on company's roll now will be afresh from the date of appointment.
Regards,
Vinayak Nagarkar
HR and Employee Relations Consultant

From India, Mumbai
No way it should be a break after payment of 'gratuity' at each point. It is implied that there was settlement of gratuity at the end of each contract. let us wait for the confirmation from the thread opener.
From India, Kannur
In absence of the contract letter nothing better one can suggest. You need to share the sample copy of contract to suggest something valid.
You make an advertisement for the vacancy but make a change in designation to which you want to engage the employee. You conduct the interview and process for the posting.

From India, Mumbai
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