Understanding Principal vs. Immediate Employers: What's the Real Difference?

What is a principal employer and immediate employer? What is the difference between them?

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A principal employer is the primary employer who engages workers for the execution of a work contract. They are responsible for ensuring that all labor laws and regulations are adhered to and typically oversee the overall project or work. On the other hand, an immediate employer is a contractor or subcontractor who hires workers for specific tasks or services within the project. The immediate employer is responsible for managing the day-to-day activities of the workers they employ.

The key difference between the two is that the principal employer holds the ultimate responsibility for compliance and oversight of the entire project, while the immediate employer focuses on managing the workers directly involved in specific tasks.

"Immediate Employer" in relation to employees, employed by or through him, means a person who has undertaken the execution, on the premises of a factory or an establishment to which this Act applies, or under the supervision of the principal employer or his agent, of the whole or any part of any work, which is ordinarily part of the factory or establishment of the principal employer or is preliminary to the work carried on in, or incidental to, the purpose of any such factory or establishment, and includes a person by whom the services of an employee, who has entered into a contract of service with him, are temporarily lent or let on hire to the principal employer.

Regards,
Gaurav Mehta