1. Ministry wants equal wages for contract, regular workers

Ministry wants equal wages for contract, regular workers

Of the around 50-crore workforce in the country, 18%, or around 9 crore, is in the organised sector

By: | New Delhi | Updated: July 15, 2015 11:22 AM
labour

According to a labour ministry proposal discussed among ministries, the Contract Labour (Regulation and Abolition) Act, 1970 will be amended to make “equal wage for equal work” statutory. (Reuters)

Over 6 crore organised-sector contract workers could expect to receive wages equal to ‘regular’ employees for the same work. According to a labour ministry proposal discussed among ministries, the Contract Labour (Regulation and Abolition) Act, 1970 will be amended to make “equal wage for equal work” statutory.

Even now, the rules under the Act prescribe that a contract worker is entitled to “same wages” for the same or similar kind of work as regular workmen. However, the rule is not being diligently enforced. The ministry feels that by providing for this concept in the Act itself, the implementation would get stronger.

Sources in the labour ministry said a committee of officers have been assigned the job to deliberate on the subject with the stakeholders that include the employers, who could oppose the move, arguing that it would inflate their wage costs.

Of the around 50-crore workforce in the country, 18% or around 9 crore are in the organised sector. According to estimates of the labour ministry, nearly 70% of them are contract workers. The labour ministry is of the opinion that though there has been some headway in bringing parity in the wages between contract and regular workers in recent times, “wide-spread exploitation” of the contract workers is “really a matter of concern”.

While Corporate India, which needs flexibility in labour-related rules, would mostly find the labour ministry’s proposal stifling, analysts say public sector units which can’t but implement the proposal if it makes into the statutes could also be hit.

The Act applies to establishments and contractors having 20 or more workmen. However, it does not apply to establishments where the work performed is of intermittent or casual nature.

Rituparna Chakraborty, co-founder and senior vice-president, TeamLease, said said that defining “equal work” would be a tricky affair and unless this is made clear, implementation of the labour ministry’s proposal would be difficult.

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