Two types of Temporary employees exist in India On pay roll and off pay roll Temporary Employees (Fixed

Term Contract ) on pay roll : There is hardly any difference between Fixed Time Contract employees and Confirmed employees. An employee who has worked for 240 days in a year is presumed to have gained continuous service. If the contract is made for 3 years initially & then is extended to a further period of 2 or 3 years and if he leaves the organisation after two years of such extended period, his total service will become 5 years and he will be eligible for Gratuity. There is no need to serve any letter stating that you have been regularised or confirmed in service. The continuity of service is decided after looking in to whether you have worked for at least 240 days in each year. The treatment given with FTC is just to keep a feeling among the employees that they are subject to termination without notice so that they will be forced to 'work' rather than indulge in trade union and other activities. They are also covered under EPF, ESI and other social security benefits available to other confirmed employees right from beginning. They are also eligible for notice if their services are to be terminated. Some other facts: a) there can be no discrimination of leave and or other benefits to any category of employee who remains in service longer than 240 days. Being on contract doesn't justify or allow such discrimination. b) The sole advantage of the FTC is to ensure that service may be discontinued without any other process on the date stipulated on the contract. c) The reason for placing on contract must not be to deny employment to worker, but because the real nature of service is either seasonal or temporary. d) For entitlement of Maternity Benefit under the Maternity Benefits Act, one need not work for years but if she had worked at least for 80 days during the 12 weeks immediately preceding her date of delivery, she is eligible for it. The only way to keep the employee as FTC is not giving them service for 240 days in a year. Then company can also appoint people off payroll which primarily means Contract Employees who are hired through a contractor for non-permanent jobs, these employees are on rolls of the contractor and not on the principal employer. For all practical purposes they are the employees of the contractor with whom the Principal employer has entered into a contract of supplying manpower. For PF and ESI deduction, based on the salary structure offered to contract employees by

the Contractor, contractor is liable to deduct and remit the contribution for PF and ESI. Primarily this is the contractor's responsibility. But the principal employer is made liable to ensure such deductions and remittances by the contractor. Under The Contract Labour (Regularization and Abolition) Act, 1970, contractor is directly liable for all payments and welfare activities of the contract labours (who are his on roll employees), but at the same time principal employer (who has engaged the contractor) is indirectly liable to ensure all payments and welfare activities by the contractor, means if the contractor fails, it is the principal employer who shall be held liable. The salient provisions of the Act, guidelines to be followed as Principal Employer: REGISTRATION : If you are a Principal Employer of an establishment engaging 20 or more contract labour, get your establishment registered under the Act for which apply in the prescribed form to the Registering Officer, pay the fees prescribed depending on the number of contract labour and furnish any additional information required by the Registration Officer. Intimate any change that may occur and get the Registration Certificate amended accordingly. LICENCE : a) Get your contractor(s) obtain a licence from the Licensing Officer b) Give the requisite certificate in form V to your contractor for obtaining licence. c) Ensure that he obtains licence and renews it every year as required. ENSURE THAT THE CONTRACTOR: a) Pays minimum wages fixed by the government if, any, or b) Pays wages as may be fixed by the Commissioner of Labour. c) In their absence pays fair wages to contract labour. d) Complies with all the legal requirements of the Act . e) Maintains various registers and records, displays notices, abstracts of the Acts, Rules etc. f) Issues employment card to his workmen, etc. SUPERVISE:

Appoint a Representative to supervise the payment of wages by the Contractor(s) to the Contract Labour. In case of failure to pay wages by the Contractor to his men, the Principal employer shall arrange to pay the legal dues of the contract labour and recover the money from the sum payable to the contractor FACILITIES Ensure that Contractor provides the following services and facilities: 1. Canteen (if employing 100 or more workmen in one place) and if the work is likely to last for 6 months or more. 2. Rest rooms where the workmen are required to halt at night and the work is likely to last for 3 months or more. 3. Requisite number of latrines and urinals - separate for men and women. 4. Drinking water. 5. Washing facilities. 6. First Aid box FURTHER a) If the principal employer can allow the contract labour to use above mentioned facilities which he has provided to his direct men, it is not necessary for the contractor to provide them separately to the contract labour b) If the contractor fails to provide the above facilities, the Principal Employer has to provide these facilities to the contract labour and recover costs for the same from the contractor. From the industrial relations point of view it is desirable to extend the same facilities to contract labour which the principal employer is providing to his direct men like canteen, rest room, latrines/urinals, drinking water, washing and first aid facilities and you may make adjustment in the rates/money payable to the contractor for providing these services directly to the contract labour. REGISTER Maintain register of contractors in Form VII and produce the same when required by the Inspector. AVOID DEFAULT

In short, ensure that the contractor comply with all the formalities and requirements of law and there is no default on his part. LIABILITY If you fail to register your establishment or the contractor does not obtain a licence, the contract labour shall be deemed to be your direct workmen and you will be fully liable for the wages, services and facilities of the contract labour etc. INTIMATION As soon as the work of the contractor with you is over, ask him to send an intimation to the Inspector regarding the completion of his job. For caution, you may also send the intimation, in addition. PRECAUTIONS While entrusting work on contract basis to a contractor, explicitly stipulate that he and his sub-contractors shall fully comply with the following enactments:a) Contract Labour Regulation and Abolition Act, 1970 b) Minimum Wages Act, if applicable c) Payment of Wages Act, if applicable d) ESI Act, 1948, if applicable e) EPF Act, 1952, if applicable f) Any other law, if applicable 2. The contract should specify that the Contractor shall be solely and fully responsible for all the contract labour employed by him or by his sub-contractors. 3. In case of any failure to comply with a statutory liability by the Contractor, the same shall be done by the Principal Employer and the expenses so incurred by the Principal employer shall be deducted from the sums payable to the contractor and if no money is due, the same shall be recoverable from the contractor otherwise. 4. Wherever the contract labour is not covered by ESI, advise the contractor to fully insure them under Workmen's Compensations Acts, cover himself against all claims and extend the accidental insurance benefit to the injured workmen.