(IGP) Special Current Affairs Material for IAS (Pre) 2013
Chapter: Gist of Press Information
Topic: Making Contract Labour Act More
Q. Which Act regulates contract labour laws and what
are highlights of this Act?
- The Contract Labour Regulation and Abolition Act, 1970 defines a
contract labourer as a worker hired by principal employer of an
establishment through a contractor for execution of a specific job.
- The Act makes certain welfare provisions like payment of minimum wages,
certain health and sanitation facilities at the working place, provident
fund benefits etc. for the benefit of contract labourers.
- The Act applies to any establishment employing 20 or more workers on a
contract basis on any day during the last one year. All contractors who
employ or have employed 20 or more workers on any day of the preceding
twelve months come within the purview of the Act.
- It is mandatory for such establishments to get registered as principal
employers. Besides these regulatory provisions, government may prohibit
employment of contract labour in any establishment or in any
process/operation depending upon whether the work is perennial in nature or
the work is incidental for an establishment.
- The Central Government on the recommendations of the Central Advisory
Board has abolished contract labour system in a number of jobs in different
industries and so far over 70 notifications have been issued.
Q. Why Contract Labour Regulation and Abolition Act, 1970 is considered under
The Act provides for government inspections to detect violations. Despite all
these provisions, it has often been found that the la w is under- protective for
As the contract labour is mostly in unorganised sector,
it is hard for contract labourers to prove their identity as workers because
the employer-employee relationship under the Act is blurred.
To circumvent labour laws various kinds of employment
structures have been created since globalisation reducing permanent jobs
into non-traditional part-time, casual and contractual forms of employment.
This has weakened job security and collective bargaining of workers.
According to the D.G., Labour Welfare “Contract Labour, by and large, is
neither borne on pay roll or muster roll nor is paid wages directly.
The establishments, which outsource work to contractors,
do not own any direct responsibility in regard to their labourers.
Generally, the wage rates to be paid and observance of working conditions
are stipulated in agreements but in practice they are not strictly adhered
to.”It has also been observed in some developing countries that with
contractualization of labour, social security of workers has suffered and
workers are often terminated without benefits.
Q. What the action is being taken by the government to
mitigate the problems arising regarding contractual labour?
The Central Government has decided to amend the Contract
Labour Act and has appointed a Task Force to make suggestions in this
The Act is being amended to ensure job security to
workers and to check their exploitation. Conceding that outsourcing of
labour has severely affected the workforce. With employers resorting to
outsourcing methods to a larger extent, the practice has dealt a severe blow
to employees as they get lower wages.
Before suggesting any amendments it would be incumbent
upon the Task Force to examine that whatever little is ensured by the law is
adhered to in practice. The Task Force would have to balance between the
flexibility in labour markets necessary in a competitive world, employment
generation and job protection and social security benefits to workers.