if a labour contractor runaway in the middle of the contract, what happens to his employess?

Question

what are liablities of principal employer in this case, as per contract abolition act , Is all the employees deployed by the contractor shall become the employee of the principal employer or else, kindly give answer based on the proviosions of law

Answer 1

There is no provision under Contract Labour (Regulation and Abolition) Act, 1970, that the principal employer is legally liable to employee all the employee/labours of the contractor directly under his service directly in such circumstances of the contractor runaway in the middle of the contract. Section 21(4) of the said Act only provides that in case the contractor fails to make payment of wages within the prescribed period or makes short payment, then the principal employer shall be liable to make payment of wages in full or the unpaid balance due, as the case may be, to the contract labour employed by the contractor and recover the amount so paid from the contractor either by deduction from any amount payable to the contractor under any contract or as a debt payable by the contractor. Further section 30(2) provides Nothing contained in this Act shall be construed as precluding any such contract labour from entering into an agreement with the principal employer or the contractor, as the case may be, for granting them rights or privileges in respect of any matter which are more favorable to them than those to which they would be entitled under this Act. So we can say that the Principal employer will be liable for the unpaid salaries of the contract labour which such a runaway contractor has not paid. The principal employer can also enter in a direct contract of employment with these employees on better terms & conditions which they were getting through the contractor or provided under the said Act.

Answer 2

It depends on the contract signed by the principal employer and the contractor, If there is a provision to treat the employees engaged by the contractor as the employees of the principal employer, then the employees are saved. If the contractor at his level engaged those employees, then definitely it will be a problem. Still you can consult the labour commissioner of your place and submit your problems.

Answer 3

either they should run in different directions for other jobs and/or get an FIR regisetered against him...

Answer 4

They get deported(no work no visa)