Introduction
The workers employed by or through an intermediary or a third party comes under the category of contract labour. Such kind of labour differs from the permanent labour in following aspects:
• Absence of names on the muster roll of principal employer/establishment
• Absence of employee-employer relationship
• No direct relationship with the principal employer
• Method of wage payment
As per Section 2(b) of the Contract Labour (Regulation and Abolition) Act, 1970 (‘Contract Labour Act’), a workman shall be deemed to be employed as ‘contract labour’ in or in connection with the work of an establishment when he is hired in or in connection with such work by or through a contractor, with or without the knowledge of the principal employer.
Pronouncement of Apex Court
In an important judgement, the Supreme Court gave a ruling that payment of contract workers should be same as permanent workers because denial of the principle of equal pays for equal work • is a violation of human dignity,
• led to exploitative enslavement,
• is against the provision of Article 39(d) of the Indian Constitution. Due to a lack of job security and social security, the contract workers suffer. They lack bargaining power and are not adequately remunerated for the work performed.
Trade Unions
Industrial Revolution resulted in trade unionism. An association of wage earners to ensure safeguarding the workers’ interests and improving the working conditions is termed as trade union. Trade unions render various benefits that include the following
• Worker empowerment
• Socialism and welfare of workers
• Proper regulation of personnel matters
• Dispute settlement and grievance redressal
• Participative decision-making and enhanced bargaining power
However, the trade union movement in India does not give contractual labour any membership or voting rights, to which other members are eligible, and hence suffers from a major problem. The reasons behind this are as follows:
• Greater Management Hostility: There is a general belief among the workers that including the contract workers in the union may turn the management hostile to their demands.
• Management Attitude: Managements do not like to discuss any issues in concern with contract workers.
• Vulnerability of Contract Labour: The highly insecure and vulnerable nature of job of contractual workers make them more probable to be dismissed from the company for their indulgence in union activities.
• Attitude of Permanent Workers: Permanent workers themselves are unwilling to include contract workers for union membership for the fear of getting marginalised with numbers of contract workers more at a workplace.
Provisions and Challenges of Contract Labour in India
The contract labour in India barring those from some PSUs in select sectors such as steel and coal is heavily exploited and largely un-unionised. There are various legislations and provisions existing with respect to such labour, but to ensure their welfare, effective enforcement of these acts along with additional labour reforms is required.
Trade Union Act, 1926
Under the Trade Unions Act, 1926 (‘Trade Union Act’), Section 2(g) defines workman as any person employed in trade or industry whether or not in the employment of the employer with whom the trade dispute arises and any workman who works in a factory can join a union of that factory. However, only permanent workers constitute trade unions as its members due to absence of direct relationship with the principle employer.
Contract Labour (Regulation and Abolition) Act, 1970
The Contract Labour Act was enacted to abolish contract labour. This Act on the other contrary offered a legal operating framework to labour contractors and secured workers’ exploitation at their hand. Both permanent and temporary workers were eligible for claims as members of the same union before this legislation was enacted
The Contract Labour Act, however, increased the scope of hiring contract labour by introducing a distinction between an ‘employer’ and a ‘principal employer’. Hence, it is proposed to drop the term ‘abolition’ from the name of the Act.
The Contract Labour Act was enacted with the intention to prevent the contract labour recruitment for core production work. Hence, workers are employed for non-core jobs such as cleaning or gardening. However, after the worker is hired, he is engaged in production activities, and no documentation is available to show engagement of a contract worker in production.
Conclusion
The growing exploitation of contractual labour require immediate attention to stop. It will be good for both the companies and the society to realise the implications associated with it. Moreover, reforming the labour to deal with such issues is also important for the success of Make in India and for India to raise its rankings on World Bank’s Doing Business Report