payment of bonus to contractor employees
CA.VEDANTH RAMANUJAM
(Querist) 30 November 2010
This query is : Resolved
is payment of bonus the responsibility of the contractor or the principal employer in case contrator fails to pay?
is there a limit for payment of bonus to contractor employees?
Kirti Kar Tripathi
(Expert) 30 November 2010
Under Contract Labour (Regulation and Abolition) Act, in case Contractor fails to pay the dues to the employees(including Bonus), the principal employer is liable to make payment to the employee. However, he has a right to indemnify the same from Contractor.
Kirti Kar Tripathi
(Expert) 30 November 2010
Under Contract Labour (Regulation and Abolition) Act, in case Contractor fails to pay the dues to the employees(including Bonus), the principal employer is liable to make payment to the employee. However, he has a right to indemnify the same from Contractor.
CA.VEDANTH RAMANUJAM
(Querist) 01 December 2010
thank u Sir.but Section 21 of Contract labour (Regulation and abolition ) Act 1970 makes the principal employer liable in case Contractor fails to pay the "WAGES".but Wages under Sub section (h) of Section 2 (Definitions) shall have the meaning assigned to it in clause (vi) of Section 2 of the Payment of Wages Act 1936,whivh specifically excludes bonus from the term "WAGES".
Hope i am correct.
M V Gupta
(Expert) 01 December 2010
Dear mr. Ramanujam,
The definition of the word "wages" in the Payment of Wages Act, 1936 does not exclude bonus. It includes "any additional remuneration payable under terms of employment(whether called bonus or by any other name)". Further it has been consistantly held that bonus is deferred wages. Hence under the Conrtract Labour (Abolition and Regulation) Act, the principal employer would be liable to pay bonus to the Contract labourers, if the contracter fails to pay.
