In a move to boost ‘Ease of Doing Business’ fixed term employment for all sectors extended

The concept of fixed term employment defines the tenure of employment as well as other associated conditions of service and remunerations, which are provided to regular employees under various labour laws. The government has extended the facility of hiring workers on fixed term employment to all sectors for improving the ease of doing business for players intending to hire people for completing specified projects, tasks or orders. The facility of fixed term employment was introduced in apparel manufacturing sector in Industrial Employment (Standing Order ) Act in October, 2016.

[Key highlights] As per a notification issued by the labour ministry to amend the Order :-

  • The words “fixed term employment in apparel manufacturing sector” will be replaced by “fixed term employment” meaning that facility would be available/extended to all sectors.
  • The worker employed for short period will get better working and service conditions as compared to a contract worker.
  • No notice of termination of employment shall be necessary in case of temporary and badli workmen.
  • The fixed term employment is defined as a workman employed on a contract basis for a fixed period. Thus the services of the workman will be automatically terminated as a result of non-renewal of contract between the employer and the workman concerned.
  • A fixed term worker would not be entitled to any notice or pay in lieu of that, if his services are terminated or in case of non-renewal of contract or expiry of term of employment.
  • Also a temporary workmen who has completed 3 months of continuous service, shall be given 2 weeks notice of the intention to terminate his employment if such termination is not in accordance with the terms of the contract. In case he has not completed 3 months of continuous service, he shall be informed for the reasons for termination in writing.
  • Any services of temporary nature shall not be terminated as punishment unless the employee has been given an opportunity of explaining the charges of misconduct alleged against him.
  • A separation of service of the workman as a result of non-renewal of the contract of employment between the employer and workman concerned shall not be construed as termination of employment. This facility will aid the industry to employ worker in sectors which are of seasonal nature and witness fluctuation of demand and hence requires flexibility in employing workers.
  • Under the fixed term employment the working conditions in terms of working hours, wages, allowances and other statutory dues would be at par with a permanent workmen and no less than that.
  • A fixed term worker will also be eligible for all statutory benefits available to a permanent workman proportionately according to the period of service rendered by him even though his period of employment does not extend to the qualifying period of employment required in the statute.
  • The employer can directly hire a worker for a fixed term without mediation of any contractor.

[Source: The Economic Times]

Photo Courtesy: Financial Tribune, https://financialtribune.com/sites/default/files/field/image/

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