Contract Labor Challenges: Can Our Contractor Keep the Same Workers Long-Term?

Dear All,

I would like to employ contract laborers through a contractor and wish to have the same contract laborers for a longer period on the role of the contractor. The turnover in service and the process of finding new helpers/contract laborers, providing them training, seems to be a very difficult task. Can our labor contractor make his employees permanent on his payroll and provide us with the manpower?

I would like to provide employment to labor through a contractor and would like them to work with us for an extended period. Alternatively, can the contractor supply us with labor for permanent positions?

Regards,
Jeevan

The object of employing contract labor on a permanent basis itself is against the SAIL Judgment of the Apex Court, which considers such arrangements as a sham, running the risk of the contract labor claiming permanency.

Please see https://www.citehr.com/285737-legal-...dustry-13.html

Thank you.

As suggested by Rajan, engaging contract labor on a permanent basis will be viewed very seriously in light of the recent judgment by the Supreme Court in the Bhilwara Milk Cooperative Society's case. It will be considered an attempt to circumvent the rights of employees under various labor laws.

Regards,
Madhu.T.K

Dear Seniors,

Please advise on the following:

1) Can we engage contract labor for more than 3 years?

2) Can we engage a Labor Contractor for more than 3 years? We were told by someone that a labor contractor cannot exceed a 3-year timeframe, as otherwise, the labor contractor will be considered an employee of the principal employer, not a labor contractor.

Please advise.

Regards,
Amit Kumar

Both of your questions are complicated. As long as you and your contractor comply with CLRA provisions and the CLRA license is renewed without violation of the conditions of issue, the law by itself will protect you.

Rajan Law Firm
https://www.citehr.com/285737-legal-...dustry-13.html

Dear Amit,

Things that you have heard have nothing to do with CLRA. For effective contract labour management, the following things can be done:

1. Six months break in one year (No artificial break).
2. Control and supervision should be done by contractors.
3. Administrative management such as leaves, gate pass, disciplinary actions, and absent cases should be handled and controlled by the contractor, not the employer.
4. Certification by the employer's representative for payments made in front of him.
5. Engagement of contract labour in support functions.
6. Fluctuating number of contract labour on RC (Certificate of Registration) since it will reflect that your requirement is not constant.
7. Valid agreement between employer and contractor, valid license with the contractor, and valid RC with the employer.

Hope this can help you.

Regards, Rahul Bagale