Payment Of Gratuity For Contract Labour

Boss,
You being the principal employer, you are liable to pay the satutory payments as far as your contractor doesn't pay. You should ensure that your contractor makes the statutory payments or you may make the payment and deduct from his bill

PE cannot be held responsible for payment of gratuity for the workers of a contractor since the PE has no record of employment of the worker with the contractor.
A worker might have worked with the contractor for 8 years, where as PE may got the service of the worker before his termination, only for one year.

Dear Friend
In the instant case the security agency though employed more 10 employees in all his sites but all those employees are governed by the provisions of CLRA Act. Only three employees employed in the Office and the disputed guard along with another are not governed by CLRA Act. The Asst. Commissioner of Labour clarified that the persons who are governed by the provisions of CLRA Act need not be counted again under the AP Shops and Estt Act, 1961. In such scenrio only 5 employees employed by the Security Agency are governed by the AP Shop & Estt Act and in such case the provisions of PGA does not apply to the Security Agency. When both CLRA Act and PGA does not apply to the Security Agency the question of payment of gratutity to the guard may not arise. Please give a thought and clarify the position.
with regards
sanagapalli

Dear Sanagpalli,
While counting of number of employees to determine applicability of PGA, CLRA and PGA have no bearings.. It is employership that will be determining factor. Since, security service provider employs 10 or more employees, prime facie there is case for gratuity for your security guard. However, you must refer a good commentary over the relevant provisions as there are number of things which will have to be studied for constructing a firm opinion.
A lot has been said about section 12 (4) of CLRA, no claim application can be filed based on this section before any authority. Reasons ... a - CLRA does not have a claim recovery provision, ..b - PGA does not have concept of PE or indirect employee.
Regards
P K Jadia

I am sorry, in first line of my it should be CLRA and SE Act have no bearing, ... and not PGA as inadvertantly, I did mention

hi all
The principal employer is not liable to pay gratuity if the contractor of security service fail to pay the same.
Mohan Rao

Dear Mr Khola,
You do have a point that a principal employer for default on account of Gratuity and Bonus can take a stand that these 2 payment are the liability of the contractor only. But keeping in mind these are social legislations and authrorities can make their interpretation more flexible and in favour of the weak section of the society. In my present employment many such case are pending,we have taken such a stand but we have been made the party alongwith the contractor though we have made strong objections.
Regards,
Ashok K. Ghose

hi, i am director of a security agency. if u r paying all the statutory benefits to the security agency, then it is responsibility of the agency to pay to the guards, however being principle employer it is ur duty to check whether the agency has paid or not. for further clarification / info, u may contact me at [Login to view]

Hi All,
I would like to know whether the expats employees can be included in the gratuity act.
Kindly advice.