Skip to main content

What Are The Tests To Find Out Whether Contract Labourers Are Direct Employees?

In CIVIL APPEAL NOS. 1799-1800 OF 2019, BHARAT HEAVY ELECTRICALS LTD. vs MAHENDRA PRASAD JAKHMOLA, the Supreme Court was dealing with an appeal filed by Bharat Heavy Electronics Ltd, which contended that the workers were not its direct employees but were contract labourers, and hence were not "employees" within the meaning of the UP Industrial Disputes Act.

To decide the appeal, the bench referred to the test laid down by SC in General Manager, (OSD), Bengal Nagpur Cotton Mills, Rajnandgaon v. Bharat Lala and Another (2011) 1 SCC 635, which is as follows :

Two of the well-recognized tests to find out whether the contract labourers are the direct employees of the principal employer are:

(i) whether the principal employer pays the salary instead of the contractor; and
(ii) whether the principal employer controls and supervises the work of the employee.

The expression "control and supervision" in the context of contract labour was explained by this Court in International Airport Authority of India v. International Air Cargo Workers' Union as follows :

"If the contract is for supply of labour, necessarily, the labour supplied by the contractor will work under the directions, supervision and control of the principal employer but that would not make the worker a direct employee of the principal employer, if the salary is paid by a contractor, if the right to regulate the employment is with the contractor, and the ultimate supervision and control lies with the contractor.

The principal employer only controls and directs the work to be done by a contract labour, when such labour is assigned/allotted/sent to him. But it is the contractor as employer, who chooses whether the worker is to be
        
assigned/allotted to the principal employer or used otherwise. In short, worker being the employee of the contractor, the ultimate supervision and control lies with the contractor as he decides where the employee will work and how long he will work and subject to what conditions. Only when the contractor assigns/sends the worker to work under the principal employer, the worker works under the supervision and control of the principal employer but that is secondary control. The primary control is with the contractor"

Applying the test, the bench held that the workers were not direct employees.

It was held that test No. 1 is not met as the contractor pays the workmen their wages. Secondly, the principal employer cannot be said to control and supervise the work of the employee merely because he directs the workmen of the contractor 'what to do' after the contractor assigns/ allots the employee to the principal employer. Supervision and control of the principal employer is secondary in nature, as such control is exercised only after such workman has been assigned to the principal employer to do a particular work.

Comments

  1. The development has a vital role in any part of the world, especially in the United Arab Emirates. The infrastructure of a country uncovers the budgetary wealth and the living status of individuals. There are various kinds of construction companies in Dubai such as concrete structures, Steel outline structures, Light gauge steel, wood-framed development, load-bearing construction, solid development, pre-designed structures, mechanical structure, and 3d printed building.
    construction companies in Dubai list

    ReplyDelete

Post a Comment

Most viewed this month

Merits and the terms of contract are irrelevant for invoking of the bank guarantees

In Sabarkantha Annuity Pvt. Ltd. Vs. NHAI and Ors, the Petitioner filed before the Delhi High Court  petition under Section 9 of the Arbitration and Conciliation (Amendment) Act, 2015 with a prayer that, Respondents be restrained from acting upon the letter dated 15th September, 2017 or from invoking the Bid securities of the Petitioner to the tune of Rs. 10.93 Crores and also restraining the banks from honouring the invocation of said bank guarantees on behalf of Respondent No. 1 acting in terms of letter dated 3rd November, 2007. Petitioner has relied upon Clauses Nos. 9.1.1, 9.1.2 and 4.3 of the agreement dated 28th April, 2017 entered into between the parties to say the claim for damages since is not a claim for a sum presently due and payable and the respondent would be entitled to damages only on proof of loss, per Clause 4.3 of the agreement and hence is not entitle to the entire sum of bid security.  The Court found that Clause No. 9.1.2 speaks of an exclusiv...

Right of pre-emption under West Bengal Land Reform Act

In Rabindra Nath Kundu & Anr vs Sudhir Hira, Bijoy Krishna Hira being the owner in the suit plot, gifted to Santosh Kumar Hira demarcated 11 decimals of land vide deed of gift dated 27.4.2004 and the latter sold 9 decimals out of 11 decimals of land to Sudhir Hira the preemptor/opposite party no. 1 and well demarcated 1.65 decimals of land in the said plot along with several other plots were sold, transferred and conveyed to the preemptees/petitioners herein by a registered deed of sale dated 10.8.2010, the subject matter of preemption. It is argued on behalf of the preemptees that  the present opposite party no. 1/preemptor Sudhir Hira has no relationship of co-sharership with Santosh Kumar Hira opposite party no. 2 as the demarcated portion of land has been purchased. It is settled principle of law that partial preemption is not permissible and this was what the view adopted by this Hon'ble High Court is Surendra Vs. Abhimannu reported in (1980) 1 Cal LJ 135 whe...

CBI has no jurisdiction to probe affairs of medical college:HC

The Madras High Court has quashed charges against administrators of a medical college and dismissed CBI's petitions opposing discharge of officials of two other medical colleges, saying the investigation agency, or any other external agency for that matter, has no jurisdiction to probe the affairs of a medical college. Quashing the charges against the administrators of a medical college and dismissing CBI's petitions opposing the discharge of officials of two other medical colleges, Justice Aruna Jagadeesan said "contravention of rules and regulations may be an offence against the statute but is not a crime. There is no room or jurisdiction for any external agency to investigate the affairs of any medical institution coming within the purview of the Medical Council of India." In identical set of orders, all delivered on August 6, Justice Jagadeesan said "the shortfall in faculties and submissions of fake/forged documents would only disentitle the institution...