How Should Wage Slips Be Handled for Contract Workers with Multiple Employers in a Month?

If a contractor provides contract labor to two principal employers and one of the workers works for both principal employers for 10 and 20 days respectively in the same month, will the contractor issue two wage slips to the worker as per CLRA Form XIX or a single wage slip with the mention of both principal employers' names and locations?

Is it necessary for principal employers to keep copies of wage slips?

What if the worker receives a different daily rate at both locations? If a single wage slip needs to be issued, how should the daily rate be handled in that case?

Looking forward to inputs from seniors in this forum.

Employer-Employee Relationship in Contract Work

Between the contractor and the workman, there exists an employer-employee relationship. The plant where the worker is sent for work is immaterial to him. If he has worked for 26/30 days, he will receive a payslip from his employer indicating the number of days worked in each plant. This payslip may comply with the relevant Act applicable to his organization, such as the Shops and Commercial Establishments Act, and not necessarily in Form XIX under the CLRA Act. It will detail the establishment's name (contractor's establishment) and specifics like the number of days worked, overtime hours, etc. An employee will receive only one payslip even if working in different plants for different principal employers.

Role of Principal Employer in Wage Slips

It is not necessary for the principal employer to collect and retain copies of payslips from workers engaged by the contractor; a declaration from the contractor suffices. The principal employer is only concerned with wage payment for the period the worker worked in their plant and cannot intervene in payments for engagements elsewhere. The ESI and PF challans also display the total payout and contributions without individual breakdowns for each principal employer. By verifying if the total days in the ECR match or exceed the days each worker worked for them, the principal employer can ensure compliance. This oversight is considered adequate.

Maintaining Muster Rolls and Payslips for Contractors

Contractors need to maintain the muster roll for each establishment separately. Based on the number of days mentioned in the muster roll, wages shall be paid for each establishment, and payslips shall be maintained separately for each establishment.

Payslip Maintenance for Principal Employers

It is not mandatory for the principal employer to maintain payslips of contract labor, but it is still recommended. Wages can vary from one establishment to another as the minimum wages vary based on the scheduled industry and location. However, the contractor cannot reduce the wages of a worker if they are transferring from one location to another.

It is better to maintain these records to ensure compliance.

Contractor and Contract Labor Relationship

Contractors engage contract labor, which may work for more than one organization. The relationship between a contractor and its employees is an employer-employee relation. Contractors receive business from various PEs under different terms and conditions. However, the contractor, as the employer, pays the contract labor, and one payslip is sufficient.

Manpower Supply and Remuneration

In the case of manpower supply, when employers set different remuneration for contract labor, it should be based on the number of days worked and a per day rate for a specific period, all consolidated into one payslip.

Regards, S K Bandyopadhyay (WB, Howrah) CEO-USD HR Solutions [Phone Number Removed For Privacy-Reasons] [Email Removed For Privacy Reasons] USD HR Solutions – To strive towards excellence with effort and integrity

Thanks for the responses. However, opinions seem divided on this issue. It would be helpful if anyone could refer to any rules, notifications, or other references that can provide clarity from a legal perspective.

Can a contractor issue multiple payslips?

Can a contractor issue multiple payslips against each establishment and provide one consolidated annexure for reference to contract workers?