Contractors picking the pockets of Labourers, finds Railways

Workers being deprived of rightful pay, privileges under Minimum Wages Act

NEW DELHI: The Ministry of Railways has exposed a scam where labourers who were engaged by private contractors to execute projects across the country were denied of their rightful pay under the Minimum Wages Act, 1948, and other dues prescribed under the labour laws.

The Railways engage private contractors to execute projects worth several thousands of crores of rupees across the country. These contractors employ a large number of labourers, both skilled and unskilled, to carry out the works that include construction of bridges, buildings, gauge conversion projects and maintenance of its assets such as stations, coaching depots, locomotives, tracks, etc.

The labourers employed have to be paid wages under the Minimum Wages Act, 1948, and Minimum Wages Rules, 1950, amended from time to time. Also, wherever applicable, they have to be protected under the provisions of the Employees Provident Fund Scheme, 1952 and Employees State Insurance Act, 1948, among others. Violation of these labour legislations would entail criminal proceedings against the contractor as well the principal employers.

In its communication dated January 24, 2018 to all General Managers, the Ministry of Railway said that the contractors have been indulging in many irregularities especially in the payment of wages to contract labourers. Some “unscrupulous” contractors were resorting to various strategies “to deceitfully deprive the contract labour of their rightful wages”.

Such unlawful practices included payment of paltry wages through cash, forcibly grabbing the ATM card of labourers and drawing part of the wages paid through banks directly. “Non-payment of minimum wages to the workers is a criminal offence since it violates the statutory provisions… keeping in view of the fact violation of Minimum Wages Act, 1948, and related orders, depriving contract labour of their just and legal rights and also leading to violation of conditions of contract (exposing Principal Employer to the risk of proceedings under these Acts), these unscrupulous contractors are liable to be taken up under relevant punitive/penal proceedings,” the letter said.

Directing the authorities to take stringent deterrent penal action against erring contractors, the Ministry said the heads of departments should put in place a robust mechanism to ensure that no violation of the labour laws occurred in the respective departments.

‘Investigate complaints’

Officials were told to investigate complaints of poor wages and other violation of labour laws and blacklist contractors besides initiating criminal proceedings against them. “Any reluctance on the part of a contractor to award minimum wages to contract labour, for the period during which he had admittedly worked, is violation of contract conditions, illegal, unfair and violates the Fundamental right of the Right to Life,” the order said.

When contacted, senior officials in the Southern Railway said it was common for the contractors to engage skilled/unskilled labourers from other States and pay them a paltry salary. Since the labourers were mostly illiterate they were unaware of the labour laws or their benefits. “The labourers hail from very poor families and usually agree to abide by the terms and conditions of the contractors. For record purposes, their signature or thumb impression is obtained on vouchers to comply with the rules relating to payment and others,” a senior railway official said.