Relationship between principal employer and contractor

contractor employer employee relationship | India Judgments | Law | CaseMine

relationship between principal employer and contractor

While holding the principal employer liable for the default of the contractor the relationship between such a contractor and the establishment. An “employee” is defined for the purposes of the HSE. Act as any person of any age who the work and pays the bill, it is a principal in relation to the contractor. There are four stakeholders under the CLRA Act, the Principal employer, the Contractor, the Contract Labours and the Government.

For this purpose, the Contractor shall use mechanical devices to the maximum extent possible. The Contractor shall be responsible for the upkeep and safe custody of all the fittings and fixtures.

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The Contractor shall maintain proper records of such stores and shall be liable to make good may loss of the said stores or any loss on account of damage to the furniture or fixtures if it occurs through negligence on its part or its employees. The Contractor shall be bound to perform the assigned jobs even though the same may not have specifically been included in the schedule of services.

LIABILITIES OF A PRINCIPAL EMPLOYER FOR THE ACTS OF INDEPENDENT CONTRACTOR

The charges, if any, for these extra services, shall be settled mutually. The parties hereto shall determine by mutual agreement the number of persons to be engaged by the Contractor for effective discharge of its obligations under this Agreement.

relationship between principal employer and contractor

The Contractor shall be solely responsible for the acts of omission and commission by the persons engaged by it in the discharge of its obligations under this Agreement.

For this purpose the Contractor shall maintain proper records and accounts and submit all statutory return to the respective authorities in respect of the persons employed by it. The Contractor shall be responsible for due compliance with all statutory provisions including those relating to Employees Provident Fund and miscellaneous Provision Act,Employees State Insurance Act,Minimum Wages Act,etc.

Copies of such certificates and the names of employees engaged from time to time shall be furnished by the Contractor to the party of the first part promptly. Challans for payment of statutory dues under the various enactments other than income tax and sales tax shall be produced in original, within three days of payment for the perusal and satisfaction of the party of the first part together with a copy of the same for its record.

If there is any claim against the first party which it is bound to meet and discharge by reason of any statutory obligation or dictates of law due to the fact of the concerned employee s working in the premises of the first party, the Contractor shall be responsible to fully reimburse and compensate the party of the first part and on failure to do so be bound to face proceedings on that account.

It shall also give such persons all benefits provided for under any law for the time being in force. The party of the first part shall be at liberty to satisfy them regarding compliance of the statutory requirements by the Contractor.

Within fifteen days of the commencement of this Agreement the Contractor shall provide on its own uniforms, name plates, shoes, socks etc. It shall be the responsibility of the Contractor to ensure that while on duty such persons are always smartly attired in their uniforms.

The persons engaged by the Contractor for fulfillment of its obligations under this Agreement shall in no case be entitled to any benefit, monetary or otherwise which may permissible to the employees of the First party nor would they be entitled to raise any dispute, demand or claim in this regard or otherwise against the party of the first part. The Contractor shall send a daily report to the designate officer of the party of the first part and shall note the comments and remarks of the designated officer for immediate action and compliance.

The Contractor shall be responsible for all injury and accident to persons employed by it and for damage to the fittings, fixtures and equipment etc.

LIABILITIES OF A PRINCIPAL EMPLOYER FOR THE ACTS OF INDEPENDENT CONTRACTOR

The Contractor shall display a duty roster of its employees deployed at various locations on the Notice Board of the concerned Department of the and any employee on leave and the substitute provided may be shown in the duty roster also.

Such duty roster shall be subject to random checks by the designated officers of the First party. The Contractor shall issue photo identity card to all its employees bearing their individual photograph within one month from the date of signing of this Agreement, failing which the party of the First Part issue the identity card to the employee concerned of the Contractor and the party of the First Party shall have the right to deduct an amount equivalent to the cost of identity card from the monthly bill of the Contractor.

Any new deployment will also be issued a new identity card within 25 days of deployment. The Contractor shall maintain discipline amongst its employees and shall be responsible for the conduct and behavior of its employee.

relationship between principal employer and contractor

The Contractor shall not appoint any sub-contractor to carry out any obligations under the contract. The definition of an employee under section 2 f of the Employees Provident Funds and Miscellaneous Provisions Act, means any person who is employed for wages in any kind of work, manual or otherwise, in or in connection with the work of an establishment, and who gets his wages directly or indirectly from the employer and includes any person employed by or through a contractor or in connection with the work of the establishment.

While relying upon the definition of employee under section 2 f of the Act read with para 30 of the Employees Provident Fund Scheme, the provident fund authorities always insist upon the principal employers to ensure that the contractors as engaged must pay the provident fund contributions and in case of non-payment, the principal employers are held liable. The Provident Fund Act was enacted in when there was no contractors and if at all any contractor was there, there were only a few having less than 20 employees.

Even when the contractor had 20 or more employees, the Provident Fund Authorities did not allot Provident Fund Code number, when applied for since it was not enlisted in the Schedule-I in the Employees Provident Fund Scheme till However, neither the definition of employee nor the paragraph 30 of the Employees Provident Fund Scheme has been amended.

Needless to reiterate that every enlightened employer those contractors who are covered under the Provident Fund Act and have independent code number.

Status of workmen under the CLRA Act - iPleaders

In this context, it is pertinent to mention that the code number to every establishment including contractor is granted by the EPFO by complying with the following amongst other: Application Proforma for Coverage duly complete. List of present Employees with salary break-up details and dates of appointment and parentage etc. Chart showing number of employees, month wise from the date of start of business.

Chart showing number of employees, month wise, engaged through contractor s. Date of commencement of business. Copy of first invoice, if any. Proof of residences of Directors. Identification document of Directors. Particulars of the Bank Account of the Company. One blank cancelled cheque leaf.

Pan number of the Company. Copy of Aadhar card though not required immediately, but start obtaining from employees. On allotment of independent code number, a contractor acquires the status of establishment may it be a Company, firm, society or sole proprietorship and becomes responsible for deposit of Employees Provident Fund contributions. Besides that administrative charges are paid to the EPFO by such establishments.

The establishment of contractor maintains records of employees, submit nomination forms, returns and complies with other formalities like maintenance of inspection book etc.

relationship between principal employer and contractor

While holding the principal employer liable for the default of the contractor s the provident fund authorities overlook the Form 5A under paragraph 36A of the Employees Provident Fund Scheme stipulating that every employer is require to furnish in duplicate to the Regional Commissioner with particulars of all the branches and departments, owners, occupiers, directors, partners, manager or any other person or persons who have the ultimate control over the affairs of the factory or the establishment and also to send intimation of any change of such particulars.

It is intriguing as to why a principal employer should be held liable for the default in payment of contributions or delaying the same by the establishment of the contractor. In Pardeep Kumar vs.