Despite significant progress in India’s industrial and corporate sectors, a silent yet deeply ingrained disparity continues to separate permanent employees from contractual workers, especially in the area of workplace welfare. From the quality of meals served to access to basic facilities, contract labour often faces inferior treatment despite performing some of the most essential, physically demanding, and operationally critical tasks.
This unequal system—driven largely by outdated legal provisions and fragmented responsibilities—creates visible divisions, lowers morale, and increases attrition. Ensuring equal welfare standards is not just a compliance requirement; it is a fundamental step toward dignity, productivity, and inclusive growth.
Key Highlights
1. Unequal Welfare Standards Create Visible Workplace Segregation
Permanent employees receive nutritious meals, hygienic dining spaces, and clean washrooms—while contractual workers face inferior food, unhygienic facilities, or even restricted access.
This visible inequality disrupts workplace harmony and creates clear class divisions inside the same organization.
2. Legal Loopholes Allow Companies to Shift Responsibility
Differences between the Factories Act and CLRA Act let principal employers offload welfare obligations to contractors.
This fragmented legal structure disrupts accountability, enabling companies to treat thousands of workers as second-class.
3. Discrimination Damages Productivity, Morale, and Retention
Contract workers face locked washrooms, denied seating, degrading behaviour, and no dignity—even though they often perform the most essential tasks.
This disruption leads to higher attrition, lower honesty, reduced ownership, and declining productivity across the workforce.
4. Lack of Uniform Welfare Policies Threatens Inclusive Growth
Without unified guidelines for meals, washrooms, and welfare facilities, organizations create inconsistent and unfair practices.
This disruption prevents India from building equitable workplaces and affects national goals of dignity, equality, and sustainable industrial growth.
The Divide: On-Roll vs Off-Roll Workers
Walk into any factory or corporate facility, and the contrast is clear:
• Permanent employees enjoy free or highly subsidized, hygienic, and nutritious meals.
• Contract workers, governed under the Contract Labour (Regulation and Abolition) Act, 1970, are often charged for meals or given inferior-quality food, even though many of them work longer hours and perform more physically demanding tasks.
This disparity is not merely about cost—it is about equity, dignity, and compliance.
Welfare Discrimination Beyond Meals
The welfare gap extends far beyond the canteen. In many workplaces, contractual staff face unhygienic, poorly maintained, or restricted washroom facilities, which compromises both their health and dignity. There are instances where washrooms meant for permanent staff are locked using biometric access, and contract workers are explicitly denied entry. When HR representatives request access, the response often remains: “We cannot provide access due to company policy.”
Such practices are not just discriminatory—they are dehumanizing.
In some organizations, contract workers are discouraged or even prohibited from sitting with permanent employees in common areas. Principal staff may speak to them in ways that imply they lack dignity, intelligence, or value. This creates an atmosphere where contract workers are viewed as inferior or expendable.
The reality, however, is the opposite. Contractual staff often possess deep operational expertise and handle critical tasks that keep daily operations running smoothly. Yet, because their salaries are routed through a contractor, they are frequently treated as “outsiders” with no identity or worth in front of the Principal Employer.
This mindset is harmful and outdated. Contract workers are not “less than”—they are an essential part of the workforce, contributing heavily to productivity, continuity, and organizational success.
Legal Loopholes Reinforce Inequality
| Category | Governing Law | Welfare Provision |
| Permanent Employees | Factories Act / Shops & Establishments Act | Mandatory canteen for over 250 workers; quality strictly regulated |
| Contract Workers | CLRA Act, 1970 | Welfare required but quality/cost often left to contractor discretion |
This fragmented approach allows companies to outsource responsibility, resulting in inconsistent and often unfair treatment of contract labour.
The Irony: Who Solves the Real Problems?
Contract workers—machine operators, security guards, housekeeping staff, and maintenance technicians— often handle the most essential, day-to-day operational tasks. Yet they routinely receive:
• Lower wages
• No job security
• Inferior meals
• Limited access to welfare amenities
This is not only unfair—it is unsustainable.
Why This Must Change
India’s labour ecosystem has evolved, and contractual employment now forms a substantial part of modern industries. The government must update welfare standards to reflect this reality.
Proposed Government Guidelines for Equitable Welfare
1. Uniform Welfare Standards
• Equal quality and hygiene standards for meals, beverages, washrooms, and all welfare facilities.
• Mandatory FSSAI certification for canteens.
• Regular, unbiased audits.
2. Subsidized Meal Scheme for Contract Labour
• Government-backed subsidies or tax incentives for companies providing free/subsidized meals.
• Minimum nutritional standards for industrial meals.
3. Mandatory Inclusion in Welfare Audits
• Contract labour welfare must be a compulsory part of annual compliance audits.
• Companies should publish audit outcomes to ensure transparency.
4. Unified Labour Welfare Code
• Merge welfare-related provisions of the Factories Act, CLRA Act, and S&E Acts.
• Remove loopholes that allow shifting responsibility to contractors.
5. Grievance Redressal Mechanism
• A dedicated complaint cell for contract workers under the Ministry of Labour.
• Anonymous reporting through mobile apps or helplines.
6. Recognition & Incentives
• Certifications and awards for companies following equitable welfare practices.
• Benefits for contractual workers based on tenure or contribution.
Additional Considerations
Psychological Impact: Visible inequality in welfare practices leads to frustration, low morale, and a sense of exclusion.
Cost of Discrimination: Poor-quality meals and restricted facilities can lead to health issues, absenteeism, turnover, and labour unrest—costing companies far more in the long run.
Role of Industry Bodies: Associations such as CII and FICCI can develop voluntary industry standards to promote fairness.
Digital Monitoring: Digital logs for meals, hygiene audits, washroom access, and worker feedback can ensure transparency.
Worker Representation: Both permanent and contract workers should have representatives in canteen and welfare committees.
Conclusion
The objective is not merely legal compliance—it is ethical leadership. True organizational excellence is measured not just by profit or productivity, but by how humanely and fairly it treats the individuals who keep operations running every day. When two workers stand side by side performing essential tasks, their dignity should never depend on whether they are permanent or contractual.
A nation striving for inclusive growth must ensure that every worker—regardless of employment type—is treated with equal respect and fairness. Welfare is not a privilege for permanent staff; it is a fundamental right for all who contribute to an organization’s success.
Moreover, companies that provide fair and consistent welfare standards—including hygienic washrooms, equal access to facilities, and quality meals—naturally see better performance from essential services teams. Good facilities and equal treatment directly lead to:
• Lower attrition
• Higher honesty and trust
• Better discipline
• Stronger ownership during duty
• A more committed and productive workforce
Contract workers who feel valued are far more likely to stay longer, perform better, and support organizational goals wholeheartedly.
If India aims to build workplaces grounded in fairness, sustainability, and social justice, then bridging this welfare gap is essential. Real reform begins when organizations shift from asking, “Are we compliant?” to asking, “Are we fair?”
Only then can we build a workforce that is motivated, loyal, and truly aligned with the long-term growth of the organization—and the nation.