ON CONTRACT LABOUR
Any amount of narration would be incomplete in respect of the vows of the Contract Labour. It may be recalled that BMS conducted nation-wide survey on the plight of Contract Labour during the year 2007 and adopted a resolution in the last 15th National Conference held in April 2008 at Cuttack, Odisha after elaborate discussion. Programmes followed highlighting the issue.
2. The 42nd Indian Labour Conference held in February 2009 discussed on the exploitation of Contract Labour and recommended to the Government to make amendments in the Contract Labour (Regulation & Abolition) Act, 1970. In pursuance there to, during June 2009, the Government appointed Tripartite Group to examine and suggest amendments to the Act. There were two labour representations in the Group one each from BMS & INTUC. The Group concluded the deliberations by the end of December 2009. As there was no unanimity, the representatives of workers, employers and Government submitted their proposals separately. Besides others, the views of workers representatives included (i) All benefits and allowances at par with ILO Standards and that of the employees of Central PSUs and Central Government and (ii) Speedy and on the spot verification regarding the perennial nature of jobs and 100% absorption of the working Contract labourers on issue of the notification under Sec. 10(2).
3. Soon after, on 22-01-2010, the issue of amendment to the CL(R&A) Act was also discussed in the State Labour Ministers Conference and the following proposal for amendment was unanimously accepted. (quote)
i) In case where the contract labour performs the same or similar kind of work as the workmen directly appointed by the Principal Employer, the wage rates, holidays, hours of work social security and other conditions of service of contract labour shall be the same as is available to the workmen on the rolls of Principal Employer. In case same or similar kind of work is not being performed by the workmen directly employed by the Principal Employer, the Appropriate Government will notify the wage rates, holidays, hours of work, social security and other conditions of service.
ii) Whenever a contract is given to a contractor, the contract agreement between the Principal Employer and the Contractor should clearly indicate the wages contribution towards social security schemes and other benefits that are to be paid by the contractor to the contracted workman.
4. As one of the agenda items, this was further discussed in the subsequent 43rd Indian Labour Conference at its meeting at New Delhi on 23, 24 November, 2010. Here again, unanimity eluded on the twin issues of regularisation of services of contract labour and payment of wage and benefits at par with permanent employees. However, the workers representatives in the ILC endorsed the views of its representatives contained in the report of the Tripartite Group, mentioned here in before.
5. Earlier, the Group of Minister, 2002 had identified ten activities such as sweeping and cleaning as ancillary, supportive and peripheral which may be kept out of the purview of Sec.10 of the Act. The Special Subject Group constituted by the Prime Minister’s Council on Trade and Industry had recommended to “Regulate contract labour in various industries to non-core activities of a company and not abolish it. This should be made explicit in the CL(RA)Act, 1970 by amending the relevant portions of the Act. This clause should clearly define that contract labour could not be utilized in the concerned company’s continuing manufacturing process and should be relegated only to company’s non-core needs.” All jobs & activities are complimentary and supplementary to each other and essential for smooth functioning of the enterprise. BMS opposes this proposal for classification of core & non-core. This is against the objective of The CL(RA) Act which does not discriminate the jobs, but only envisages to identify whether perennial etc.
6. It is worthy to mention the two developments. The Government presented the Annual Report to People on Employment on 1st July, 2010. The short term strategies and targets related to the contract labour are as follows.
Para 6.1.iv. “Statutory provisions to provide social security and improved conditions of work and remuneration of contract workers at par with the regular employees.” This appears as a camouflage to bypass the provision of regularisation of services of contract labour, in conformity with the Sec. 10 of CL(R&A) Act, 1970
7. Also, the Secretary, Labour & Employment, GOI, told media in September, 2010, that there is a proposal to amend the Contract Labour (R&A) Act, 1970 to facilitate payment of wage, facilities, benefits and social security to Contract Labour as received by regular employees, to satisfy the demand of workers. At the same time the Industry would be given the ‘flexibility’ to hire contract labour. This militates against the objective of the Contract Labour (Regulation and Abolition) Act, 1970, which prohibits engagement of contract labour in perennial jobs. BMS Opposes this ‘flexibility’ both in theory and practice
8. It is apt to recollect that the Supreme Court Judgment of 2001 in the SAIL case did not remove the right of the contract worker for regularisation of services, where the parameters laid down in Sec. 10 of the Act are attracted, but only directed that the procedure laid down by the Act be followed which implies the issuance of notification of prohibition by the appropriate Government, on the basis of the recommendation of the Contract Labour Advisory Boards. This procedure is cumbersome and time consuming besides jeopardizing the very continuity of existing employment as contract labour. Further that Supreme Court declared that the Act does not envisage automatic regularisation of the services of the contract labour, in the event of the prohibition under Sec. 10 of the Act. This only brought to light that the Act provisions are not commensurate with the objective of the Act. So, it becomes the responsibility of the Government to amend the Act, to fulfil the objective.
9. The other major lacunae of the Act is the Rule 24(2)(iv) which stipulated that the wage payable to the contract worker shall not be less than the rates notified as per the Minimum Wages Act, 1948. The norms for fixation of minimum wage rates are not specified in the M.W. Act. As such the rates notified under this Act by the appropriate Governments is about Rs. 3000/- to 4000/- making the worker as ‘working poor’. The Constitution of India directs the Government to provide a living wage. The 15th Indian Labour Conference laid down the norms for fixation of minimum wage rates. While ratifying these norms, The Supreme Court of India in its Judgment in the case of Reptacas Bret & Co. held that an amount equivalent to 25% be added. The 2nd National Commission on Labour, 2002 and The National Commission for Enterprises in the Unorganized Sector, 2007 approved and recommended the norms of minimum wages laid down by the 15th ILC. The Government has stated on record that the appropriate Governments are considering these norms while fixing the Minimum Wage Rates under the M.W.Act. While appreciating this statement of the Government, we represented to the Government that the rates so far notified are no where near the rates that would have been, had these norms of 15th ILC were followed. There is no response from the Government for our demand to arrange for review and re-fixation of the minimum wage rates.
10. The Contact Worker is subjected to deprivation of the social security provided by the ESI Act, 1948 and EPF &MP Act, 1952. due to the violation of the provisions by the Employer. Sec.40 and Para 30 of the ESI Act and EPF Scheme respectively of the two Acts mandate the Principal Employer to pay the contributions related to the contract labour, directly to the designated authorities under these Acts. Violating the mandate the Principal Employer is said to be making payment to the contractor providing him an opportunity to misappropriate the contributions, the hard earned wages of the worker. The Authorities under these Acts are not enforcing these provisions of these Acts, which amounts to abatement of the misappropriation.
11. In the circumstances, this 16th Conference of Bharatiya Mazdoor Sangh demands the following.
1. The system and provision for engaging Contract labour should be abolished. In any event fulfilment and compliance of norms of wage, social securities, other benefits, conditions of service and terminal benefits by the Principal employer should be made mandatory.
2. The CL(RA)Act, 1970 should be amended
(a) to provide for automatic absorption of the serving contract labour in the event of notification prohibiting engagement of contract labour under Sec.10, and others; to offset the pernicious effects of the SAIL judgement of 2001.
(b) To provide for on the spot and expeditious verification of the nature of job, whether perennial and attract the parameters of Sec.10 of the Act, and to issue notification.
(c)To remove the threshold limit of 20 workers for the applicability of the Act.
(d)To provide for fixing responsibility on the Principal Employer in respect of the payment of wage and other benefits of the contract workers and payment of contributions towards the ESI and EPF to the designated authorities directly.
(e)To provide for payment of gratuity and bonus.
(f)To provide for implementation of the existing provisions and Rules there under, in letter and spirit.
(g)To provide for payment of wage through Bank or post office.
(h)To provide for continuity of Contract Workers in the work even if the Contractor is changed, and should not be terminated as long as the work continues.
(i) To provide for regulation of the terms of contract between the Principal employer and contractor, and the amount of contract should be sufficient for compliance of wage, benefits and social security as per the existing laws.
(j) To provide for 100% compliance of the Registration of establishments and issue of license for engaging contract labour. The contract workers should be treated as employees of the Principal employer in the event of failure to comply with registration of a establishment and obtaining license by the employer on contractor.
(k)To provide for payment of wage, benefits and social security to contract labour at par with regular employees.
(l) To provide for a forum for representation of grievances and negotiation to contract labour.
(m) The Contract Labour should be declared as voters along with the permanent employees of the establishment in the secrete ballot elections for identification of majority Union
held under the code of discipline or by the
3. The Sec.40 of ESI Act, 1948 and Para 30 of EPF Scheme under the EPF & MP Act, 1952 should be enforced strictly and it should be ensured that the Principal Employer remits the contributions to the designated authorities directly. The minimum threshold of 10 or 20 workers for the coverage of these Acts should be removed.
4. The proposal for identification of jobs as ancillary/non-core, and excluding them from the purview of Sect. 10 of CL(RA) Act is unscientific and should be withdrawn.
5.The Government issued Financial instructions on Budget/expenditure, economy measures, rationalization of expenditure and measures for augmentation of revenues etc. which are the main cause for the engagement of contract labour and out sourcing in the Government Offices, Departmental undertakings, PSEs and various schemes. As these instructions are against natural justice, fair play and leading to non-inclusive growth should be withdrawn forthwith and the employees should be made regular on where is and as is basis.
6. Awarding contract to Labour Cooperative Societies should be mandatory, to eliminate the middleman and the attendant exploitation.
7. The Government should arrange to amend the Minimum Wages Act, 1948 incorporating the 15th ILC norms of wage rate fixation and the Supreme Court orders.
8.Recruitment of contract labour in core sector enterprises, (like power, coal, steel, cement), should be banned, as the jobs are invariably of perennial nature.
9. Government should establish a statistical wing to compile number of contract labour, the wage rate and level social security provided to them.
10. The posts of Labour Department should be filled up and additional posts should be created and filled up, to ensure implementation of Acts.