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Appeal No. KAR-980 of 1980, heard on 25th March, 1981.

-- S. 2 (xxviii)-Workman employed by a Contractor and employed through a Contractor-Distinguished.

There is a wide distinction between workmen who are employed by the Contractor and those who are employed through the Contractor. In cases where an establishment or a part of establishment is given on lease or contract, there would be distinction between persons employed by the owner of the establishment and those who are employed by the Contractor himself. In the case of workmen employed by the owner of the establishment, he would continue to be their employer notwithstanding the fact that he may have leased out the establishment as a running concern, unless the workmen had agreed to becoming the employees of the Contractor and separate appointment orders in this behalf are issued to them. In the case of workmen employed by the Contractor, the employer would clearly be the Contractor notwithstanding the fact that they are employed in the establishment which is owned by the proprietor, unless the contract makes the proprietor responsible for them.

Khurshid Ahmad Siddiqi for Appellants.

M. S. Khan for Respondents.

Date of hearing : 25th March, 1981.

The 2 respondents, Muhammad Hanif and Mohammad Arif, filed separate grievance petitions before the learned 1st Labour Court alleging that they were employed as permanent workmen in the appellant company since past 1 years, that though they had been required to, work for over hours a day, they were not paid overtime in accordance with law, that in order to safeguard the rights of workmen, they formed a Trade Union, which had been duly registered under the law, and that on account of their association with this Trade Union and further by reason of their giving evidence against the appellant-Company in cases filed by some workmen with the Authority under the Payment of Wages Act and the Commissioner, Workmen's Compensation, the appellant company wrongfully and with mala fide intent terminated their services on 16th July, 1980. The appellant Company resisted the grievance petition of the respondents on the grounds, firstly, that they had leased out the establishment to Contractor Ahsanullah Baig, who was respon sible for carrying out his obligations under a valid contract, and secondly, that the establishment does not employ more than 19 persons and hence, the Standing Orders are not applicable to it. The learned Labour Court, by a consolidated order, rejected the twin contentions of the appellant- Company and allowed the grievance petitions of the 2 respondents with the direction that they be reinstated in service with full back benefits.

2. The learned Labour Court itself has held that Ahsanullah Baig was running the establishment as Contractor. It, however, has taken the view that this makes no difference as Ahsanullah Baig was in fact working for the appellant-Company and the definition of workers includes those who are employed through Contractors. There is, however, a wide distinction between workmen who are employed by the Contractor and these who are employed through the Contractor. Furthermore, in cases where an establishment or a part of establishment is given on lease or contract, there would be a distinction between persons employed by the owner of the establishment and those who are employed by the Contractor himself. In the case of workmen employed by the owner of the establish ment, he would continue to be their employer notwithstanding the fact that he may have leased out the establishment as a running concern, unless the workmen had agreed to become the employees of the Contractor and separate appointment orders in this behalf are issued to them. In the case of workmen employed by the Contractor, the employer would clearly be the Contractor notwithstanding the fact that they are employed in the establishment which is owned by the proprietor, unless the Contract makes the proprietor responsible for them. It has been admitted by the learned counsel appearing for the parties that there is no evidence on record to show whether the respondents were employed by the owner of the establishment or by the Contractor Ahsanullah. In the absence of any such evidence, it cannot be said whether the employer of the 2 res pondents is the appellant company or the Contractor, Ahsanullah Baig. I would accordingly, set aside the impugned decision of the learned Labour Court and remand the case to it for giving a fresh finding in the 2 cases after giving an opportunity to both sides to lead evidence on the material issue whether the respondents were employed by the appellant company or the Contractor Ahsanullah Baig. The back benefits deposited by the appellant company will continue to remain deposited with this Tribunal pending the decision by the learned Labour Court on remand.

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