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of <h1>Principal employer liable for wage difference, not additional amounts. Clarification on contractor liability and recovery.</h1> <h3>Hindustan Steel Works Construction Ltd. Versus Commissioner of Labour and Ors.</h3> Hindustan Steel Works Construction Ltd. Versus Commissioner of Labour and Ors. - TMI Issues Involved:1. Liability of the principal employer for wage differences under Section 21 of the Contract Labour (Regulation and Abolition) Act, 1970.2. Applicability of Rule 25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971.3. Definition and scope of 'wages' under the Contract Labour (Regulation and Abolition) Act, 1970 and the Payment of Wages Act, 1936.Issue-Wise Detailed Analysis:1. Liability of the Principal Employer for Wage Differences under Section 21 of the Contract Labour (Regulation and Abolition) Act, 1970:The primary issue was whether the principal employer (the appellant) is liable to pay the contract workers any amount constituting the difference between the wages payable by the contractor and the wages paid by the appellant to its own employees doing similar work. The court clarified that under Section 21, the contractor is responsible for the payment of wages to each worker employed by him. If the contractor fails to make this payment, the principal employer is liable to make the payment and may recover the same from the contractor. The court emphasized that Section 21 deals only with the payment of contractual wages by the contractor to each of his workers. The principal employer becomes liable to make good the difference only if the contractor fails to pay the wages as per the terms of employment.2. Applicability of Rule 25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971:Rule 25(v)(a) mandates that the contractor shall pay wages to the contract labour that are not less than the wages paid by the principal employer to its own workers performing similar work. The court noted that this rule imposes a condition on the contractor's license but does not make the principal employer liable for payment in case of non-compliance by the contractor. Any breach of this condition by the contractor would result in consequences for the contractor alone. The principal employer is not liable under Section 21(4) to pay additional amounts arising from the contractor's non-compliance with Rule 25(v)(a).3. Definition and Scope of 'Wages' under the Contract Labour (Regulation and Abolition) Act, 1970 and the Payment of Wages Act, 1936:The court examined the definition of 'wages' under Section 2(1)(h) of the Contract Labour (Regulation and Abolition) Act, 1970, which refers to the definition in the Payment of Wages Act, 1936. 'Wages' include all remuneration payable under the terms of employment, any award, settlement, or court order. The court concluded that Section 21 only deals with the payment of these defined wages by the contractor to his workers. The principal employer is responsible for ensuring that the contractor pays these wages but is not liable for any additional amounts not covered by the definition of 'wages' under the Act.Conclusion:The appeal was allowed, and the direction of the Division Bench requiring the appellant to pay additional wages as per Rule 25(v)(a) was set aside. The appellant is only liable to pay the difference between the contractual wages agreed upon and the lesser wages actually paid by the contractor, and can recover this amount from the contractor. There were no orders as to costs.
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