Govt’s bid to amend Contract Labout Act

Living up to its populist image and with an attempt to surge industrial growth the Govt looks at amending the  Contract Labour Act of 1970. The intended change is to bring the salaries of the contract labour at par with those of the permanent workmen of the respective Company. This amendment further suggest to give all benefits to contract labour as any permanent workmen would be entitled to, excepting a assured tenure. This amendment also proposes to make it easier for companies to hire or fire contract worker.

But here are some stark realities which will have to be looked at while proposing the changes -

1. Contract Labour are engaged for jobs which are non-core and hence cannot be compared for the purpose of equitable salaries. If such a proposal is because companies engage contract labour for their core activities where contract labour are given work similar to those of permanent workmen, then it is this aspect which should looked into for correction, rather than enforcing equal salaries.
2. Contract Labour, if given equal salaries and benefits as any permanent workman would kill the very purpose of engaging contract labour. The employer would lose out on the benefit of engaging reasonably cheaper labour.
3. Disengagement of contract labour, in today’s times, has proved to be equally litigious as compared to termination of the services of any permanent workman.

So where is the edge???. The govt’s attempt to surge growth would only result in a tail spin. Such a amendment would only result in escalating costs to the Companies and rethinking on their even having a permanent workforce!!

It would be wise if the Govt would seek the industries views on such an amendment while the industry itself scuffles in its bid to survive cost and competition.