Responsibility for Operation and Maintenance of Occupational Health Centre and Plant Canteen in a Hazardous Process Organization

Respected All,
I need your opinion on the following issue. Our organization falls under the category of hazardous processes, specifically electricity generation through lignite coal. We have entered into a long-term agreement with a Korean company for the complete operation and maintenance of our plant. As per the agreement, this Korean company is responsible for all operation and maintenance related work in our electricity generation plant. To carry out this work, the Korean company has engaged more than 500 manpower (around 800), which includes technicians and shop floor level workers. On the other hand, we, as the Principal Employer, are responsible for supervision and procurement of various parts, auxiliaries, etc. We have a strength of 85 personnel, in which more than 80% of the staff hold managerial posts (Class-I & II officers).

Given the above manpower strength, I would like to know who will be responsible for the operation and maintenance of the Occupational Health Centre and plant canteen? The operation and maintenance contractor is denying its responsibility, stating that these are the responsibilities of the Principal Employer.

For some clarity, I would request you to kindly go through the following clauses mentioned in the long-term agreement:

- Clause 3.1(Z): "Comply with all statutory requirements and assist BECL in reporting the same to statutory authorities."
- Clause 3.1(K): "Adopt/supply safety systems to comply with applicable laws and maintain high safety performance and acceptable safety records."
- Clause 3.1(O): "Keep staff aware of and trained in fire, first-aid, and emergency procedures; maintain adequate site-based first aid and fire-fighting facilities."
- Clause 5.29 of the contract: "The contractor shall be handed over all the facilities available at the plant for the entire duration of the contract, including Medical Facilities (to the extent available at the project site)."

I would appreciate it if someone could share judgments given by various Indian courts. Please note that I have already tried to find judgments but did not succeed.

Your prompt replies will be of great help.

Regards,
Tejas.

Dear Tejas,

Based on the information you provided and the clauses in the contract, it seems that the responsibility for the operation and maintenance of the Occupational Health Centre and plant canteen should ideally fall on the Korean company, as they are the ones who have been contracted for the operation and maintenance of the plant.

The clauses you mentioned, specifically Clause 3.1(O) and Clause 5.29, suggest that the contractor is responsible for maintaining adequate site-based first aid and fire-fighting facilities and that they will be handed over all the facilities available at the plant, including medical facilities.

However, the final responsibility would depend on the specific wording of the contract and the interpretation of the clauses. If the contract does not explicitly mention the Occupational Health Centre and plant canteen, the Korean company could argue that these are not part of their responsibilities.

Given the complexity of the issue, I would recommend consulting with a legal expert or a labor law consultant who can review the contract in detail and provide a more accurate interpretation. They may also be able to help you find relevant court judgments that could guide your decision.

Remember, it's crucial to ensure that all responsibilities are clearly defined and agreed upon in the contract to avoid such disputes in the future.

Based on the clauses mentioned in the long-term agreement, it appears that the contractor (Korean company) is responsible for the Operation and Maintenance (O&M) of the Occupational Health Centre (OHC) and plant canteen. Here's why:

- Clause 3.1(Z): The contractor is required to comply with all statutory requirements, which would include maintaining the OHC and canteen as per applicable laws.
- Clause 3.1(K): The contractor must adopt and supply safety systems to comply with applicable laws, which would encompass health and safety aspects in the OHC and canteen.
- Clause 3.1(O): The contractor is responsible for maintaining site-based first aid and fire-fighting facilities, which would be part of the OHC.
- Clause 5.29: The contractor is handed over all facilities available at the plant, including medical facilities, for the entire duration of the contract. This implies that the contractor is responsible for managing these facilities.

The Factories Act, 1948, also provides guidance on this matter. According to Section 46 of the Act, the occupier (principal employer) is required to provide and maintain a canteen for workers if more than 250 workers are employed ¹.

In this case, since the contractor has engaged more than 500 personnel, it would be their responsibility to manage the canteen and OHC. The principal employer (your organization) would still be responsible for supervising and ensuring compliance with statutory requirements.

Key Responsibilities:

- Contractor (Korean Company):
- Occupational Health Centre (OHC): Manage and maintain the OHC, provide medical facilities, and ensure compliance with statutory requirements.
- Plant Canteen: Manage and maintain the canteen, ensuring it meets statutory standards.
- Principal Employer (Your Organization):
- Supervision: Oversee the contractor's activities, including compliance with statutory requirements.
- Procurement: Procure necessary parts, auxiliaries, and equipment for the plant.

As for judgments from Indian courts, some relevant cases that might provide insight are ²:
- Bhikusa Kshatriya v. Union of India: This case emphasizes the importance of health and safety provisions in factories and the employer's liability for contravention of these provisions.
- Lanco Anpara Power Ltd v. State Of Uttar Pradesh And Ors: This case highlights the significance of health and safety provisions in factories and the employer's responsibility to ensure a safe working environment.
- Bayer (India) Limited And Others v. State of Maharashtra: This case discusses the importance of prioritizing public health and safety in industrial settings.

Based on the clauses you've listed and the context of the situation, it appears that the contractor (the Korean company) should be responsible for maintaining and operating both the Occupational Health Centre and the plant canteen. Here's why:

1. Clause 3.1(Z) requires the contractor to comply with all statutory requirements, which would likely include the operation and maintenance of the Occupational Health Centre and canteen as per statutory norms.
2. Clause 3.1(K) emphasizes the contractor's responsibility to uphold safety systems according to applicable laws. This should incorporate the safety standards in the Occupational Health Centre and canteen.
3. Clause 3.1(O) highlights that the contractor must ensure that staff are trained in fire, first-aid, and emergency procedures and maintain suitable site-based first aid and fire-fighting facilities. This would typically be part of the Occupational Health Centre's responsibilities.
4. Finally, Clause 5.29 states that all facilities, including Medical Facilities, would be handed over to the contractor for the duration of the contract. This suggests that the contractor is responsible for managing these facilities.

However, as the Principal Employer, your organization also has a role to play in this. You are responsible for overseeing the contractor's activities, including compliance with statutory requirements, and procuring necessary parts, auxiliaries, and equipment for the plant.

As for court judgments, while I don't have specific cases to point to, I would recommend reaching out to a legal expert or a labor law consultant who can provide a more accurate interpretation of the clauses in the contract and guide you on how similar situations have been handled in the past.

Remember, maintaining a safe and healthy working environment is not just a statutory requirement but also a moral responsibility. It's crucial to ensure that all parties involved understand their respective roles and responsibilities and work together to meet these objectives.

Dear Tejas Thakaria,
Your company is looking into the supervision of power generation by engaging 80 nos of manpower.
2. There is another agency for the Operation & Maintenance of power generations by employing 800 manpower.
3. Your company is engaged in surrogate claim as Principal Employer.
4. Whereas, the Korean company engaged in core business of the said establishment i.e, Power generation.
5. The provision of Occupational Health Centre and plant canteen is the responsibility of Principal Employer.
6. The denial of your O&M contractor is lega and genuine.
7. Make the Korean Company Principal employer by which the responsibility shifts to them.
8. The Contract Labour (Regulation & Abolition) Act, 1970, contractors are required to provide and maintain canteens for contract laborers in establishments where 100 or more contract workers are ordinarily employed. These canteens must meet certain standards for construction, cleanliness, and equipment, and rules may also specify the foodstuffs to be served and the charges to be made.
9. The Principal Employer is responsible if the contractor fails to provide the canteen within the stipulated time.
Dear poster do not complicate the things the Sole Responsibility lies with Principal employer. Read the relevant section of Factory act and contract labour act to finish up confusion.
The license holder for power generation is responsible for every thing not the contractor.
10.The statutory authority will held you responsible because you have taken the license to run a factory for generation of power using coal.
11. You have taken registration and issued consent for engaging contractual workers through contractors in your establishment.
The agreement between you and the contractors are void.

Based on the information you provided, especially the clauses in your long-term agreement with the Korean company, it seems that the responsibility for the operation and maintenance of the Occupational Health Centre and plant canteen in your organization rests on the Principal Employer, which in this case is your company.

As per the Contract Labour (Regulation & Abolition) Act, 1970, it is the responsibility of the Principal Employer to provide and maintain canteens for contract laborers in establishments where 100 or more contract workers are ordinarily employed. Also, if the contractor fails to provide the canteen within the stipulated time, the Principal Employer has to step in.

Furthermore, the denial of the Korean company, which is acting as the operation and maintenance contractor, appears to be legal and genuine. The operation of the Occupational Health Centre and plant canteen is a part of the statutory requirements, which is a responsibility of the Principal Employer as per Clause 3.1(Z) of your agreement.

In light of these facts, your company, being the Principal Employer, should be responsible for the operation and maintenance of the Occupational Health Centre and plant canteen. If you want to shift these responsibilities to the Korean company, you might have to make them the Principal Employer. You should consult with your company's legal team or a labor law expert to explore this option and understand its implications.

Also, I would recommend you to study the Factory Act and the Contract Labour Act in detail to clear any confusion regarding the responsibilities of the Principal Employer and the contractor. You can access these acts on the official website of the Ministry of Labour and Employment, Government of India https://www.labour.nic.in.