The main aim of this Act is to prevent contract labour exploitation in the hands of the contractor or the employer. Contract labours are different from direct labours. This Act is applicable where 20 or more workmen are employed on any day in the preceding 12 months. This Act does not apply to establishments where work of seasonal nature is carried out.
Contract labours employed by different contractors and for different purposes have to be taken into consideration for the purpose of calculating the number of employees employed. An application has to be made for registration and obtaining the license if any contractor or employer falls under the purview of this Act. In case, the labour employed is for a short period of 15 days then this Act gives an option of Temporary Registration as well.
[Suggested Read: Shops and Commercial Establishments Act (S&E), 1961 – Brief Notes]
The Ministry of Labour and employment has recently introduced a category of ‘Fixed Term Employment’ for all sectors in the Industrial Employment (Standing Orders) Act, 1946. The main object of this is to substantially reduce the exploitation of Contract labours as the employer would directly hire the worker without any mediator in the form of contract for a fixed term.
- The act does not cover the employees at managerial and administrative posts and when the salary is more than Rs1600 per month.
- The employee is responsible for the registration of the establishment with Registration officer to obtain a certificate and also to apply for a licence for hiring contract labour.
- Under this Act, the contractor is bound to provide facilities such as canteen when more than a 100 labour is contracted, sufficient ventilation and light in work area, resting place for overnight workers, basic medical facilities etc.
- The contractor is bound by law to pay the hired labourers their wages in a regular and timely manner. The responsibility shall lie on the Principle Employer if the contractor fails to do so.
- The contract labourers also qualify for the benefits of other statues such as Employee Provident fund Act, Factories Act, Payment of Wages, Minimum Wages Act, Industrial Disputes Act, and Workmen’s Compensation Act.
[Suggested Read: Right of Legal Aid in India – 11 Provisions You Must Know]
