October 06 2004
Domestic labour laws tend to be pro-worker. As such, employers must take seriously their obligations under the various statutes. Once an employment relationship has been established, the employer must fulfil certain statutory obligations; non-compliance entails serious consequences, including imprisonment. Consequently, employers are frequently inclined to outsource or subcontract less essential functions. The issue that arises in such circumstances is whether the workers operating under the subcontract have legal recourse against the employer and whether they should be regarded as employees. While there is no determinative test regarding the employer - employee relationship, the Supreme Court recently discussed and consolidated the principles of law that govern the issue in the context of a dispute between the workers of a cooperative society and the society itself. Historically, the supervision and control test is the prima facie test for determining an employment relationship (ie, whether the employer can control not just what an individual does, but also the way in which he or she does it). The nature or extent of control can vary between businesses. Over the years, this test has been considered to be insufficient. Other factors that were additionally considered indicative of a relationship concern:
For further information on this topic please contact Anand Prasad or Biraj Tiwari at Trilegal by telephone (+91 11 5163 9393) or by fax (+91 11 5163 9292) or by email (firstname.lastname@example.org or email@example.com).
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