Contractor Dilemma: Should Double Wages Be Paid for Festival Work Without Reimbursement?

Respected Seniors,

Is it compulsory for any contractor to pay double wages to contract employees for working on festival holidays? The principal employer has 12 festival holidays in a year. It is insisting that the contractor pays double wages for working on these days to contract employees. However, they are not ready to reimburse the same to the contractor. They will only pay single wages for these days to the contractor. The principal employer is covered under the Factory Act.

Please advise on resolving the issue. The contractor is prepared to pay single wages.

Thanks,
Santosh

Dear Santhosh, extra wages for working on a festival holiday would also fall within the statutory definition of the term "wages." Section 21(4) of the CLRA Act, 1970 imposes vicarious liability for the payment of wages to contract labor on the principal employer. If any contract labor is required to work on any festival or national holiday, with or without the knowledge of the principal employer, they should be paid double wages or be given an alternative holiday with wages, as per their choice. If any contractor fails to do so, it is the duty of the principal to pay such wages and have it deducted from the contractor.

Thank you.

Dear Sir,

Here, my query is how festival holidays applicable to the principal employer will also be applicable to contract employees. If the principal employer will only pay single wages to the contractor for working on these festival holidays, how can they demand double wages from the contractor for contract employees?

Please advise.

Dear Sir,

The principal employer's HR states that as contract employees also fall under the definition of workmen under section 2 of the Factory Act, festival holidays applicable to permanent employees should also be applicable to contract employees. Is this correct?

Thank you.

Factory is covered under the Gujarat Factory Act. Is there any act related to national and festival holidays in Gujarat?

Dear Santhosh,

Mr. Umakanthan has clearly mentioned above for your clarifications - If any contractor fails to do so, it is the duty of the principal employer to pay such wages and get it deducted from such contractor.

Regards,

P. Senthil
Coimbatore.

Holiday Wages for Contract Labor

What your PE's HR says is correct, but the PE's stance that he would pay only single wages for the holiday work done by the contract labor is not only contrary to his own HR's statement but also to Section 21 of the CLRA Act. Both the Factories Act, 1948, and the CLRA Act, 1970, are Central Enactments and, as such, they have nationwide application. Therefore, there is no point in further discussion on any other grounds.

If you are a contractor, institute civil action against the PE; in case you are a representative of the contract labor, file a claim under Section 15 of the Payment of Wages Act, 1936, before the Authority under the Act against both the PE and the contractor.