Are Workmen Entitled to Leave Under Contract Labor Laws? Let's Discuss!

Leave for Workmen Under Contract Labor Laws

Is there any leave for workmen under contract labor laws?

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Dear Mr. Mrithyunjay,

Legally, there are no distinct leave policies specific to contract labor. The leave rules applicable to employees of the principal employer also apply to contract labor. These rules may be in accordance with the provisions of the Factories Act or the Shop Act, whichever is applicable.

While agreeing with Srinivas about the applicability of leaves to contract labor as per the Factories Act or Shops Act, as the case may be, I would differ in that the contract labor should be entitled to the same leaves as regular employees. It is not necessary that contract labor should receive the same number of leaves because regular workers' leaves are primarily governed by settlements rather than the law. The settlements will exclusively apply to regular workers and cannot be extended to contract workers. However, they are entitled to leave as per the Factories Act if they are working in factories or as per the Shops Act if they are working in offices.

Dear Mr. Mrithyunjay,

Leave Entitlement for Workmen

A workman gets one leave per 20 days of working. The accumulated leaves are paid at the end of the calendar year.

State-Specific Leave Rules

Different state governments have different rules for leave that need to be adhered to. The leave rules of the Principal Employer are generally not applicable to contract labor, but they become applicable if the work order issued contains terms and provisions specified in the certified standing orders of the Principal Employer.

These rules are in accordance with the provisions of the Factories Act, Mines Act, Shop Act, or B&OCW Act.

The Contract Labor (Regulation and Abolition) Act, 1970

The Contract Labor (Regulation and Abolition) Act, 1970, is both a regulatory and prohibitive piece of legislation pertaining to the system of contract labor in India. Like water assuming the shape of its container, the working conditions of contract labor are derived from the provisions of the establishment-specific labor law applicable to the principal employer's establishment where they are engaged through the contractor. This also applies to the types and scales of leave available to any contract labor, as explained by the learned members above.

Hi Mr. Madhu T K, To clarify, Mr. Mrithyunjay specifically inquired about leaves stipulated by the law. Therefore, my response was focused on the leaves granted under the Shop Act or Factories Act.

I understand your point, and that is why I have agreed to your observation that the same number and types of leave available under the respective Acts are also available to contract laborers. However, my disagreement lies in the fact that contract workers should not necessarily receive leaves on par with regular workers. The reason being, the latter may receive better leaves through settlements that exceed what is provided under the Act, and these settlements may not be binding on the contract workers.

"Accumulated Leave Payment

"The accumulated leaves get paid at the end of the calendar year." - This is not what the Acts - Factory or Establishment Acts state. EL can be accumulated and gets encashed at the time of parting. Yes, in a few organizations, they are encashed, but that cannot be taken as mandatory.

"The accumulated leave gets paid at the end of the calendar year." This is not what the Acts—Factory or Establishment Acts—state. EL can be accumulated and encashed at the time of parting. Yes, in a few organizations, they are encashed, but that cannot be taken as mandatory.

Compensation for Workmen Under Contract

A workman under a contractor, upon exiting services, receives wages for the month plus any applicable bonus if exiting on their own accord. In the case of retrenchment, notice pay or retrenchment compensation, if eligible, is provided. The act and rules have not envisaged any form or register for maintaining leaves. Thus, carrying over leaves to the next calendar year is out of the question.

The contractor ensures that all receivables are paid to the workman by the end of the calendar year and submits them as an annual return.