It is a known fact that the principal employer is responsible for all contract employees hired through contractors. Liability includes paying minimum wages, paying on-time wages, paying statutory bonuses, paying wages for leave accumulated, paying double overtime, PF & ESIC/WC policy, Maternity Bonus & Maternity Benefit, and deduction of the labor welfare fund. (Please add if anything is missing.)
My Question Is:
A) Can the above liability be avoided if, in certain contracts like gardening, Effluent Treatment Plant, Utility, etc., we provide the total scope of activity as one work (e.g., maintenance of 10,000 sq ft of garden, maintenance of ETP or Utility areas, paying the canteen contractor per plate instead of per manpower, etc.), and convert these contracts into service contracts instead of manpower contracts?
B) Is there any case law supporting or opposing this concept? Experts may please shed some light on this as we can save a lot of the principal employer's liability.
My Question Is:
A) Can the above liability be avoided if, in certain contracts like gardening, Effluent Treatment Plant, Utility, etc., we provide the total scope of activity as one work (e.g., maintenance of 10,000 sq ft of garden, maintenance of ETP or Utility areas, paying the canteen contractor per plate instead of per manpower, etc.), and convert these contracts into service contracts instead of manpower contracts?
B) Is there any case law supporting or opposing this concept? Experts may please shed some light on this as we can save a lot of the principal employer's liability.