Contract labour absorption depends on proof and exceptional facts, not mere long service or perennial work.

Contract labour engaged for long periods in perennial work do not acquire an automatic right to absorption as regular employees merely because the work is continuous or identical to that of regular staff; any claim of camouflage must be proved before the proper forum. On the exceptional facts and the long-running interim arrangements in this proceeding, the Court directed absorption of identified labourers who had worked continuously for ten years, subject to medical fitness and age limits. It fixed job-wise inter se seniority on continuous employment, denied arrears of differential wages before absorption, and held that post-absorption service would be governed by the employer's service conditions.

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Issues: (i) Whether contract labourers engaged for long periods in work of a perennial nature and identical to that performed by regular employees were entitled to absorption as regular employees of the principal employer. (ii) Whether, on the facts and the interim orders passed in the proceeding, the identified labourers were liable to be absorbed with the conditions regarding seniority, wages and other service benefits.

Issue (i): Whether contract labourers engaged for long periods in work of a perennial nature and identical to that performed by regular employees were entitled to absorption as regular employees of the principal employer.

Analysis: The statutory scheme recognises contract labour and regulates its employment, while also enabling abolition by notification under Section 10 in appropriate cases. The Act does not itself create a general right of absorption or regularisation merely because the work is perennial or because the labourers have worked for many years under successive contractors. A clause requiring an incoming contractor to retain outgoing workers may protect continuity of livelihood, but it does not by itself establish a right to direct employment. Any claim that the contractual arrangement is a mere camouflage must be established on evidence before the proper industrial forum.

Conclusion: In principle, no automatic right of absorption arose merely from long service under contractors.

Issue (ii): Whether, on the facts and the interim orders passed in the proceeding, the identified labourers were liable to be absorbed with the conditions regarding seniority, wages and other service benefits.

Analysis: The proceeding had continued for years under several interim orders, under which labourers were kept in service and the employer had also offered options for voluntary retirement or absorption. In view of the long continuance of the workers, the extent of work remaining under contract labour, and the practical circumstances created by the interim directions, the Court directed absorption of labourers who had been continuously working for ten years, subject to medical fitness and age limits. The Court also fixed inter se seniority job-wise on the basis of continuous employment, denied arrears of differential contractual and regular wages prior to absorption, and provided that after absorption they would be governed by the employer's service conditions.

Conclusion: The identified long-serving labourers were directed to be absorbed as regular employees on the stated terms and conditions.

Final Conclusion: The writ petition was allowed, and the long-serving contract labourers covered by the directions were granted regular employment with consequential service conditions regulated by the employer after absorption.

Ratio Decidendi: Contract labour has no automatic right to absorption under the Contract Labour (Regulation and Abolition) Act, 1970, but a court may mould relief on exceptional facts and continuing interim arrangements to direct absorption on defined terms where justice so requires.

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