Principal Employer

A Principal Employer is someone who controls the establishment or company. The principal employer doesn’t directly employ the worker and there is no direct relationship of the Principal Employer with the workers’ employment. It is the contractor who hires the worker and is responsible for conditions of employment.

Who is a Principal Employer

Principal Employer is the primary organisation for whom the employee carries out the duties assigned to him/her.

• A Factory: It is the owner or occupier or manager of the factory
• A Mine: It is the owner or the manager of that mine
• An Office: It is the owner of the manager of the office
• The Government: The head of the office or department or an officer notified by the government or local authority

Duties of Principal Employer

While hiring contractual workers, the employer has to:

• Register the establishment to hire contractual workers
• Hire workers only from Contractors who are registered under necessary sections of the labor code

In a situation where either of these two conditions is not satisfied, the workman employed will not be considered a contractual labourer and will be considered to have been employed directly by the Principal employer. The Principal employer also has a duty to ensure that the Contractor complies with applicable labour laws.

Principal Employer becomes liable for payment of any unpaid wages or Statutory Compliance in case the Contractor doesn’t pay the same or was not included in the wage proposal submitted by contractor. In cases, where the unpaid amount was paid by principal employer to the contractor, the same can be deducted from his payment to contractors else it will be a cost borne by the principal employer. The contractor is also duty-bound to pay bonuses to the contractual workers and Principal Employer has to ensure that same is paid from his end to the contractor to ensure compliance

Essential facilities to be Provided by Principal Employer

It is the responsibility of the principal employer to ensure that establishment has a general policy on health and safety for the workers.

The employer must ensure cleanliness, ventilation and temperature, adequate space, drinking water, latrines, and urinals. He/she must also provide facilities for washing & sitting, First Aid, Canteens, lunchrooms, and Creches.

For construction workers, the Building and Other Construction Workers Act, 1996 provides for similar essential facilities. The Building and Other Construction Workers’ Cess Act, 1996 puts the responsibility on the employer to contribute towards the BOCW fund.

• The Principal Employer has to maintain a register of contractors, a register to record the work performed, wages paid, receipts etc

• The employer must put up notices showing the place and time of disbursement of wages, rate of wages, hours of work, wage period, dates of payment of wages, and date of payment of unpaid wages.