Struggling to Define "Contract Labour" Under CLRA Act? Let's Clarify Together

Dear HR Professional, I'm studying the definition of Contract Labour, but I didn't find the exact definition. Can anyone provide the correct definition of "Contract Labour" as per the CLRA Act?

Contract labor means an employee deployed to work for an employer through another person called a contractor.

The CLRA itself explains the 'contract labour'. Please see the definition according to the act:

"2. Definitions.-(1) In this Act, unless the context otherwise requires,- (a) 'appropriate Government' means,- (i) in relation to an establishment in respect of which the appropriate Government under the Industrial Disputes Act, 1947 (14 of 1947), is the Central Government; (ii) in relation to any other establishment, the Government of the State in which that other establishment is situated.

(b) A workman shall be deemed to be employed as "contract labour" in or in connection with the work of an establishment when he is hired in or in connection with such work by or through a contractor, with or without the knowledge of the principal employer.

(c) "Contractor", in relation to an establishment, means a person who undertakes to produce a given result for the establishment, other than a mere supply of goods or articles of manufacture to such establishment, through contract labour or who supplies contract labour for any work of the establishment and includes a sub-contractor; ............ Unquote:

Workers Employed To Perform Perennial/Permanent Nature Of Work Can't Be Treated As Contractual Workers

The Supreme Court allows regularization. Read the judgment here in these links:

1) https://www.livelaw.in/supreme-court...ization-252130. (The Bench comprising Justices P.S. Narasimha and Sandeep Mehta opined that the permanent or perennial nature of...)

2) The Supreme Court, vide its judgment dated March 12, 2024, in the case of Mahanadi Coalfields Limited v. Brajrajnagar Coal Mines Workers' Union [Civil Appeal No(s). 4092-4093/2024], has held that the workers who are engaged in the performance of work which is perennial or permanent in nature would not be classified as contractual workers.

What's your doubt or what kind of info do you require, friend?

An employer who employs a worker through an employment agency or contractor is called a contract worker. Here, the employer is the principal employer, and the employing agency is the employer for the contract worker.

A workman is said to be a contract laborer when that employee is employed under a contractor. Furthermore, the work of the contractor is bound by a contract. When an employer is not the principal employer but works for the PE, the workman is referred to as a contractor's employee.

A workman shall be deemed to be employed as "contract labour" in or in connection with the work of an establishment when he is hired in or in connection with the work of an establishment by or through a contractor, with or without the knowledge of the Principal Employer.

Definition of Contract Labour

Contract labour is a workman of a contractor for the purpose of other enactments applicable for the relationship of employee and employer. Contract labour is employed in another establishment in relation to the work of that establishment of the Principal Employer. Contract labour is employed through a contractor in the establishment of the Principal Employer. Contract labour is employed in the establishment of the Principal Employer with or without the knowledge of the Principal Employer.

The term "Contract Labour," as defined under the Contract Labour (Regulation and Abolition) Act, 1970 (CLRA Act) in India, refers to workmen who are hired, supervised, and paid by a contractor who, in turn, has a contract to provide these services to a principal employer. Essentially, these workers do not have a direct employment relationship with the principal employer for whom the work is performed.

Key points under the CLRA Act:

Contractor: A person or entity that undertakes to produce a given result for the principal employer through contract labour or who supplies contract labour for any work.

Principal Employer: The entity or person who engages the contractor and is ultimately responsible for ensuring that the provisions of the CLRA Act are complied with.

Establishment: The place where the work is carried out, which may include the industry, factory, business, or office where contract labour is employed.

The Act primarily focuses on the regulation of employment conditions of contract labour, aiming to ensure their welfare and to protect them from exploitation. It also provides for the abolition of contract labour in certain circumstances where it is deemed necessary by the government.