Contractor Dilemma: Are Employers Required to Give Notice Period to Contract Workers?

I am a contractor and I want to know if there is any rule or mandate for employers to provide a notice period to contract labor (employees) working through a contractor. Please provide me with some links if possible. Although nothing is mentioned in the contract about this, I feel there must be something to help my labor in getting some notice period pay for informing them just 5 days before the termination.

The termination of the contract depends on the agreement between the employer and the contractor, adhering to the rules set forth in your terms and conditions. As a contractor, you are required to pay retrenchment compensation to your workers if they have worked for 240 days by the end of the contract period under Section 25F of the Industrial Dispute Act. The calculation is as follows:

Last drawn average salary / 30 * 15 * number of years.

I am looking forward to hearing senior views on this topic.

Thank you,

Naresh Gadde

Exploitation of Contract Laborers in the Country

It is very sad, but unfortunately, it is a fact. Contract laborers are the most exploited group in this country by all—whether it be government organizations, private sector companies claiming to be world-class organizations with ethical standing, or mediocre companies.

No notice pay, no leave, no benefits, and no retrenchment compensation.

I came across a BPO that assigned certain jobs to a corporate contractor, who in turn assigned them to a small company, which further assigned them to an individual contractor. Just imagine a 10% margin at every level, resulting in a 30% margin available, which could be sufficient to eradicate certain woes of these contract laborers.

Legally, Mr. Gadde is right. However, one need not pay retrenchment if an employee is engaged for a specific period and thereafter their services are not required. Many contractors will mention this condition and renew employment after some time, thereby avoiding the need to pay retrenchment compensation. I know some contractors even take resignation letters in advance.

As a contractor, if you want to do some good for your workmen, I must appreciate you in this forum for showing some interest in that direction.

Best wishes.

I agree with Mr. Naresh and Mr. Sivasankaran. People often avoid discussing such matters and tend to overlook the rights of contract labor/workers. However, you have shown your interest in their well-being and security, which is truly commendable. Additionally, I would like to share some information with you regarding government actions for contract labor.

Contract Labour Act to be Amended

http://www.business-standard.com/ind...mended/420701/

Since the employees engaged by the contractor to do the work of the company/organization are employees of the contractor, the company/organization is no longer under obligation to give any notice period to your employees. If you go through the agreement (if available), I am sure that it will be mentioned that the agreement between you (as the contractor) and the company/organization is on a principal-to-principal basis, and the company/organization is not responsible for the employees engaged by the contractor.

Hence, in the true sense, you are a service provider providing "services" to the company, and the company/organization does not have any responsibility for your employees apart from your bill payment.

Thanks,
Saquib