Aviary Metal Limited (AML) is a Maharatna PSU under the Ministry of Defence, Government of India, which gives progressed items and framework to military and government for manufacturing units. AML is one of the top Mahar

CS Professional · Labour Laws and Practice · PYQS · June 2024
Aviary Metal Limited (AML) is a Maharatna PSU under the Ministry of Defence, Government of India, which gives progressed items and framework to military and government for manufacturing units. AML is one of the top Maharatna PSUs. The company has grown significantly in turnover and is consistently giving sufficient profit. AML is focusing on solid development of 12-15% during 2022-23. Radar and Missile Systems, Communication, Network-Centric Systems and other areas will continue to drive the company's growth in the years ahead. In spite of being one of the top industries, total 1000 workers are employed and the working condition of most of the contractual workers are not good. Therefore, Aviary Metal Limited (AML) workers union decided to amalgamate to have effective collective bargaining as there were two registered trade unions and they all were demanding 7th pay Commission and better working conditions in AML. The contractual workers comprising 60 percent of the AML strength, which are continuously working for the last 5 years and still they are on contract employment. Now after 5 years of service, the licence of the contractor has expired to engage the contract labor or the contractor has not applied for the renewal of the licence but the workmen were still employed with the company and not given the status of regular employees. There were frequent strikes with respect to it. Now to have effective collective bargaining with the management, those two registered trade unions have amalgamated to become a strong trade union with the name of Hind Mazdoor Sangh. Hind Mazdoor Sangh were in negotiations with the management for implementation of 7th Pay Commission and to notify permanent positions for several months. Despite several round of discussions, no agreement has been reached. The industrial peace got disturbed which led to frequent strikes affecting the production and target delivery of products causing financial loss to the company. The union after giving notice to management decided to go on hunger strike for 10 days. The management of AML claims that this strike is illegal under the Industrial Disputes Act, 1947, as it has not followed the prescribed procedure for calling a strike. The management has decided to deduct 10 days wages of workers who resorted to hunger strike and initiated disciplinary proceedings against them as they turned violent, they damaged the property of the company as well. In the meanwhile, due to some dispute with the officers of AML, one worker named Rakesh has been suspended who was active member of the Union. In response to the above action, Hind Mazdoor Sangh filed the case before the Labour Court against the AML. Whereas Court decided the case in favour of Management along with compensation of ₹ 2 Lakh for the loss suffered by management. Based on the above facts, answer the following questions, with relevant provisions: Whether the employer is bound to pay the wages as per the 7th pay commission to the contractual employees and also liable to provide them better working conditions being contract employees under the Contract Labour (Regulation & Abolition Act), 1970.

Answer & Explanation:

Payment of Wages: Section 21 of the Contract Labour (Regulation and Abolition) Act, 1970 makes a contractor statutorily responsible for payment of wages to each worker employed by him as contract labour and such wages shall be paid before the expiry of such period as may be prescribed. The employer is not bound to pay the wages as per 7th Pay Commission to the contractual employees but the employer is bound to pay them the minimum rates of wages under the Minimum Wages Act, 1948 and as per the Payment of Wages Act, 1936. Working Conditions: Yes, the employer is responsible to provide them better working conditions, such as welfare and health of contract labour as given from Section 16 to 20 of the Contract Labour (Regulation and Abolition Act), 1970. Section 16 provides the facility of canteen. Section 17 provides the amenities of rest-room. Section 18 provides other essential benefits. Section 19 provides first aid facilities. Section 20 provides the liability of principal employer in certain cases. If any amenity required to be provided under Section 16, Section 17, Section 18 or Section 19 for the benefit of the contract labour employed in an establishment is not provided by the contractor within the time prescribed therefor, such amenity shall be provided by the principal employer within such time as may be prescribed. All expenses incurred by the principal employer in providing the amenity may be recovered by the principal employer from the contractor either by deduction from any amount payable to the contractor under any contract or as a debt payable by the contractor.

Topics: Contract Labour (Regulation & Abolition) Act, 1970

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