Industrial Relations

Can contract workers join a union?

Yes. The IR Code lets any worker employed in an establishment join or form a union. Whether they count toward the negotiating union is less settled.

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Yes. Under the Industrial Relations Code 2020, a contractor's crew are workers like any other, and a union's members are the people "actually engaged or employed" in the establishment or industry it is connected with. They can join the site's union, an industry-wide union, or form their own. What is less settled is whether they count toward the 51% that makes a union the site's sole negotiating union.

Who can join, and who can form one

Any worker, including a contractor's. Section 2(zr) of the IR Code defines a worker as anyone employed in an industry to do manual, skilled, technical, clerical or supervisory work "for hire or reward", and section 2(m) counts a contractor as an employer. Section 7(e) requires a union's rules to admit as ordinary members "persons actually engaged or employed in the industrial establishment, undertaking or industry" it is connected with, "irrespective of their craft or category".

StepRequirementIR Code
Apply to registerSeven or more members subscribe to the union's ruless.6(1)
Minimum membership to register10% of the workers or 100 workers, whichever is less, engaged or employed in the establishment or industrys.6(2)
Membership to stay registeredThe same 10% or 100, with at least seven, at all timess.6(4)
Office-bearers from outsideNo more than one-third of office-bearers, or five, whichever is less, may be people not engaged or employed theres.21(2)
Where it registersWith the Registrar of Trade Unions the State Government appointss.5

Because the test is "engaged or employed in the industrial establishment ... or industry", a contract crew is not confined to a union of its own contractor's employees. An industry union can take in contract and direct workers on the same footing.

Do they count for the negotiating union?

That is the open question. Section 14 says an industrial establishment with registered unions must have a negotiating union or a negotiating council:

  • One registered union. The employer recognises it as sole negotiating union, subject to prescribed criteria (s.14(2)); the Central Rules set a membership of at least 30% of the workers employed in the establishment (r.9(2)).
  • Several unions. The union supported by 51% or more "of workers on the muster roll of that industrial establishment" is recognised (s.14(3)).
  • No union at 51%. A negotiating council is formed from the unions with at least 20% support (s.14(4)).
  • Duration. Recognition lasts three years, extendable by agreement to no more than five in all (s.14(6)).

Support is verified by secret ballot, and the Central Rules say that all workers whose names are on "the muster roll of the industrial establishment" on the reckoning date may vote (r.9(4)). A contractor keeps its own attendance and wage registers for its crew. Whether that crew is on the muster roll of the site's establishment for this purpose, or forms part of the contractor's own establishment, is not settled in so many words by the Code or the Rules.

What neither employer may do

Both the site and the contractor are bound by the unfair labour practices in Part I of the Second Schedule to the IR Code, because both are employers. Among them:

  • Interfering with organising, including threatening dismissal if workers join a union, or a lock-out or closure if one is formed (item 1).
  • Dominating or funding a union, or favouring one of several unions that is not recognised (item 2), and setting up an employer-sponsored union (item 3).
  • Discriminating for union activity, including discharging a worker for urging others to join, or discharging office-bearers or active members because of union work (item 4).

An unfair labour practice carries a fine of ₹10,000 to ₹2 lakh, and more on a repeat (s.86(5)–(6)). Union dues can come out of wages only with the worker's written authorisation (Code on Wages 2019, s.18(2)(k)). For a contract crew, that deduction is made by the contractor, which runs the payroll.

What a site should check

  1. No contractor clause that restricts union membership. A clause, or a practice, of replacing workers who join a union points straight at item 4 of the Second Schedule.
  2. Supervisors briefed on the list. Contractors' supervisors and the site's own should know what counts as interference before an organising drive, not during one.
  3. Union dues on the payslip only with authorisation. The contractor should hold each worker's written authorisation for any union deduction.
  4. Counsel involved early in any verification. If a negotiating-union verification is due, the question of who is on the muster roll is better settled before the voters list is drawn up.

How Velura Services helps

We do not restrict, discourage or penalise union membership among the workers we deploy, and our supervisors are briefed on what the IR Code treats as interference. Union dues are deducted from our payroll only against each worker's written authorisation, and we keep our crew's attendance registers in a form the site and its counsel can work from if a verification arises.

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Sources

Frequently asked questions

Can a contract worker be a member of the principal employer's union?

Under section 7(e) of the IR Code 2020, a union's rules must admit as ordinary members persons actually engaged or employed in the establishment, undertaking or industry it is connected with, irrespective of craft or category. A contractor's worker engaged in the establishment's work can therefore join the site's union or an industry union, subject to the union's own rules.

How many members does a union need to register under the IR Code?

At least seven members to apply, and at least 10% of the workers or 100 workers, whichever is less, engaged or employed in the establishment or industry the union is connected with, under section 6 of the IR Code 2020. It must keep that membership, with a minimum of seven, to stay registered.

Do contract workers count toward the 51% for a negotiating union?

Section 14 counts workers on the muster roll of the industrial establishment, and the Central Rules let every worker on that muster roll vote in the secret ballot. Whether a contractor's crew is on the site's muster roll for this purpose is not settled in so many words, and is a question for counsel and the verification officer.

Can a contractor stop its workers from joining a union?

No. Interfering with workers' right to organise or join a union, threatening dismissal if they do, or discharging a worker for union activity are unfair labour practices under Part I of the Second Schedule to the IR Code, and a contractor is an employer under the Code. The fine is ₹10,000 to ₹2 lakh, more on a repeat.