How Do I Legally Terminate 150 Long-term Contract Workers at Once?

Dear Sir,

I have 150 contract laborers who have been working continuously for the last 10 years on a contract basis. I would like to know what the procedure is to terminate all of them at the same time.

Dear Sir,

I have 150 contract laborers who have been working continuously for the last 10 years on a contract basis. I want to know the procedure for terminating all workers at one time. Please advise on how to do this.

Thank you.

Dear Naveen,

The principal employer is not supposed to terminate contract workers. You can only terminate the contract and can opt for another contractor with the condition to enroll employees other than the existing. However, this will not be so easy. It may cause problems for the health of the company.

The contract laborers are employees of the contractor. Hence, the contractor can only terminate their employment and not the principal employer. There are no provisions for terminating 150 employees, which would amount to unfair labor practice with a significant financial burden. Sit down with the contractor, the employees, any union representatives, and come to an amicable settlement.

Discussion on Contract Labor Termination

The question itself is incomplete and immature. One should provide all details to have a proper discussion on the subject. As Anurag has rightly pointed out, whether it is contract labor or contractor labor is crucial.

If it is contract labor, then you cannot terminate them like that; you have to obtain retrenchment permission from the appropriate government under the ID Act, which is very difficult. If they are contractor employees, have you done registration under the Contractor Act or not? Does the contractor have a valid license? Without all this information, there cannot be any discussion.

These are contractors' laborers who have been working for the same company for the last 10 years through the same contractor.

Please let me know if you need any further assistance or information.

Dear Mr. Navin,

It is not clear whether the contract workers have been hired through a licensed contractor and with a valid contract agreement or not. Also, why all of a sudden, after a span of 10 years, you want to terminate them is not specified. These issues will determine the further course of action.

Dear,

Irrespective of the years put in by a contractor worker, you can terminate the contract of the contractor, and with it, your legal liability also ends. The only condition is that it should not be a sham or camouflaged contract between the principal employer and the contractor.

Anurag Lakhotia
Lex Labour

Dear,

The contract laborers are the employees of a contractor. Being an employer for ten years to the contract workmen, while terminating the contract workmen by the contractor, he has to follow all the 25 F and, if applicable, Chapter V B. The same has to be followed and to be retrenched in the said process.

1) Three months' notice
2) Fifteen days' average pay for every completed year of service
3) Gratuity as per the Payment of Gratuity Act

Thank you,
GK
HR