What Compensation Do Laborers Get When Retrenched Before 240 Days? Seeking Clarity on Construction Site Policies

Dear Sirs,

Greetings.

I am working as a Senior Officer (HR/Admin.) in an MNC in the power sector. We mainly focus on the construction of power plants. One of our subcontractors is retrenching laborers due to a lack of work. The laborers have not completed 240 days of work. What compensation benefits will they receive?

Please provide clarification as I am experiencing some confusion.

Regards,

M. Pandey

It's the contractor's responsibility to decide whether to keep or remove them, as the principal employer has less involvement in the contractor's role. The principal employer must ensure that the Minimum Wages Act is being followed, and that ESIC and EPF contributions are paid on time for contract workers employed through the contractor.

Please let me know if you need any further assistance.

If workers are through a subcontractor and are covered under the license taken under the Contract Labour (R&A) Act, 1970, they are just paid the last month's wages with OT if any, with statutory deductions as provided for. As far as my knowledge goes, the ID Act does not provide for workers covered under the Contract Labour Act.

Regards,

They haven't completed one year's continuous service. Hence, they are not eligible for retrenchment compensation from their employer.