The first case of Outsourcing reported in India was way back in 1967
GHATGE & PATIL CONCERN’S EMPLOYEES’ UNION Vs. GHATGE & PATIL (TRANSPORTS) PRIVATE LTD. 22/08/1967 –Supreme Court
GHATGE & PATIL (TRANSPORTS) carried on the business of transport and removal of goods by road. It owned a fleet of trucks and employed drivers and cleaners to run them. In 1963 the company, finding difficulty in observing the provisions of the Motor Transport Workers Act 1961, introduced a scheme whereby the trucks, instead of being run by the company itself were hired out to contractors at a fixed rate per mile.
Employees of the company who were engaged in running the trucks resigned their jobs and most of them who had for- merely been drivers became contractors under the scheme.
The workmen's’ Union however raised a dispute asking for the reinstatement of the ex-employees who had been given work on contract basis.
The Tribunal held that the contract system could not be said to be an unfair labour practice, for the ex-employees were never coerced or forced to resign their jobs, and they got more benefits from the contract system than from their original contract of employment.
In appeal to the Supreme Court the Union contended that the ex-employees of the company continued to be workmen notwithstanding that they were posed as independent contractors, that the beneficent legislation conceived in the interests of transport workers was being set at naught by the company, and that the setting up of the contract system amounted to unfair labour practice.
…… to be continued
GHATGE & PATIL CONCERN’S EMPLOYEES’ UNION Vs. GHATGE & PATIL (TRANSPORTS) PRIVATE LTD. 22/08/1967 –Supreme Court
GHATGE & PATIL (TRANSPORTS) carried on the business of transport and removal of goods by road. It owned a fleet of trucks and employed drivers and cleaners to run them. In 1963 the company, finding difficulty in observing the provisions of the Motor Transport Workers Act 1961, introduced a scheme whereby the trucks, instead of being run by the company itself were hired out to contractors at a fixed rate per mile.
Employees of the company who were engaged in running the trucks resigned their jobs and most of them who had for- merely been drivers became contractors under the scheme.
The workmen's’ Union however raised a dispute asking for the reinstatement of the ex-employees who had been given work on contract basis.
The Tribunal held that the contract system could not be said to be an unfair labour practice, for the ex-employees were never coerced or forced to resign their jobs, and they got more benefits from the contract system than from their original contract of employment.
In appeal to the Supreme Court the Union contended that the ex-employees of the company continued to be workmen notwithstanding that they were posed as independent contractors, that the beneficent legislation conceived in the interests of transport workers was being set at naught by the company, and that the setting up of the contract system amounted to unfair labour practice.
…… to be continued