Minimum Wages as per Shops and Establishment Act
Querist :
Anonymous
(Querist) 03 January 2011
This query is : Resolved
Please need urgent advice:
We are appointing operators through Man Power Agency and we will advice man power agency to depute their employees at designated sits.
We are paying operators a minimum wages as per Karnataka Shops & establishment Act of Rs.3516/-. Now one of our Client who is in business if engineering works, telling that they are the Principal employer of operators and operators/employees deputed by our Man Power will come under the preview of ‘Factories Act’ and Shops & Establishment Act and our Client telling that we have to pay operators minimum wages as per Factories Act @ Rs.4000/-.
But question is that our Man Power Agency employees who works ultimately on behalf of us. Hence we will the Principal Employer for this also we had executed an Agreement with our client.
Since operators does not involve in an engineering works, just they are maintaining coffee and tea vending machines installed by us at our Client premises.
I request learned Members to advice on below doubts:
1. Whether we have to pay minimum wages as per Factories Act?
2. Agreement b/w us and our Client clearly says that ‘does not create any employee & employer relationship”.
3. Since we are the Principal Employer also We have indemnify our Client on this issues by executing ‘Indemnity Bond’
Kindly Let me know that we are liable to pay minimum wages as per Factories Act or Is it okay that we are paying as per Shops & Establishment Act?
Its very urgent.
Early answer would be appreciated.
Ajay Bansal
(Expert) 03 January 2011
As per my view, ypu have to pay as per Factory act. You can not be discharged from this on your pleas as stated by you.
Querist :
Anonymous
(Querist) 03 January 2011
Dear Ajay Bansal sir thanks for your advice.
But how come Factories Act would apply to Man Power Agency employees. Since they are working on bhalf of us and we are the principal Employer.
Employees are not comes under Factories Act,
They are just maintaining our coffee and tea vending machines at our client premises.
Please advice further
R.Ramachandran
(Expert) 03 January 2011
If the employees are working in your premises they are under shops and establishment Act. If they operate the machine within the factory premises of another, then they are factory employees.
Even though you may be a principal employer, since they are being deployed within a factory premises, they would be deemed to be factory employees. In any case, you have to get adequate consideration from the factory owners (i.e. the factory wage + your margin, instead of minimum wage as per shops and establishment Act + your margin.)
Querist :
Anonymous
(Querist) 03 January 2011
Dear Ramachandran sir,
I do agree with your advice but deployed employees will not involve in any manufacturing process, they will be maintains our coffee and tea vending machines thats it. As per Factory Act ' also section 2 (i) man power employees does not come under these category please advice.
R.Ramachandran
(Expert) 03 January 2011
Even a peon employed in the factory is a 'factory employee'. To be a factory employee one need not necessarily be involved in 'manufacturing process'. So long as the employee is working in the factory, he is a factory employee - whether he acting as a peon, or as a coffee machine / tea machine operator - it would not make any difference.
Querist :
Anonymous
(Querist) 03 January 2011
dear sir could you please give me a supporting sections and rules, if any, urgent
