How Can Companies Improve Vendor Oversight to Prevent Wage Delays for Contract Workers and Ensure Their Protection Against Wage Violations?

On December 20, 2025, more than 250 outsourced housekeeping and support staff working at major Delhi Metro stations staged a sudden sit-in protest. They alleged two-month delays in salary payments from their contracting agency. Despite approaching supervisors repeatedly, they were informed that invoicing disputes with the principal employer were causing payroll bottlenecks. The protest took commuters by surprise and forced the Delhi Metro Rail Corporation (DMRC) to intervene and demand immediate reconciliation of payment records. This incident has highlighted the issue of wage continuity for contract workers in essential public services, particularly when third-party vendors manage payroll, attendance, and compliance filings.

The emotional impact on the workers was intense. Many described feeling humiliated and abandoned as they were unable to pay rent or buy essential groceries while still showing up for full shifts. Some workers broke down during interviews, expressing their fear of losing their metro access cards if they refused to work without pay. Senior workers expressed resentment that companies continue to outsource manpower but rarely monitor whether contractors maintain basic statutory payroll hygiene. The situation triggered solidarity across WhatsApp groups of contract workers in other public utilities who said they too face similar silent hardships, often afraid to protest due to job insecurity.

From a compliance standpoint, the case raises serious questions under the Payment of Wages Act, the Code on Wages, and principal employer liability under contract labour rules. Even if the contracting agency fails to pay on time, the principal employer may still be held accountable for ensuring timely wage payment. HR and compliance heads must strengthen vendor onboarding requirements, demand monthly wage proofs, verify ESI EPF payments, and maintain audit trails of attendance verification. Leadership must recognise that outsourcing worker management does not outsource legal responsibility. Ensuring timely wage delivery for outsourced staff is both a compliance obligation and a cornerstone of ethical workforce governance.

How should companies strengthen vendor oversight to prevent wage delays for contract workers? What protections should contract workers have to report wage violations without fear?

Companies can strengthen vendor oversight and prevent wage delays for contract workers by implementing several measures.

Firstly, companies should establish stringent vendor onboarding processes. This includes thorough background checks, reviewing the vendor's financial stability, and their track record in adhering to labour laws and timely payments.

Secondly, companies should insist on regular reports from vendors regarding payroll, attendance, and compliance filings. These reports should be audited periodically to ensure their accuracy.

Thirdly, companies should verify the Employee State Insurance (ESI) and Employee Provident Fund (EPF) payments made by the vendors on behalf of the contract workers. This can be done by cross-verifying the payment receipts provided by the vendor with the records of the ESI and EPF authorities.

Fourthly, companies should have a system in place to address the grievances of contract workers. This could be a dedicated helpline or an online portal where workers can report issues related to wage payments or other violations.

As for the protection of contract workers, companies should establish a robust mechanism for them to report wage violations without fear of retaliation. This could include an anonymous reporting system or a third-party ombudsman.

In addition, companies should educate contract workers about their rights under the Payment of Wages Act, the Code on Wages, and other relevant labour laws. This can be done through regular training sessions or by providing them with easy-to-understand written materials.

Lastly, companies should remember that while they can outsource work, they cannot outsource their legal and ethical responsibilities. They must ensure that contract workers are treated fairly and with dignity, and that their rights are protected at all times.