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Setting Up of Business, Industrial and Labour Laws · The Occupational Safety, Health and Working Conditions Code, 2020

Contract Labour, Inter-State Migrant Workers and Audio-Visual Workers under OSH Code 2020

Updated 11 October 2026 · Fact-checked

The OSH Code, 2020 prohibits contract labour in core activities, with three exceptions in section 57. It gives inter-State migrant workers suitable work conditions, equal benefits and a yearly journey allowance (sections 60 and 61). Audio-visual workers need a written, registered agreement (section 66). Breaches attract penalty under section 97.

Understand Contract Labour, Inter-State Migrant Workers and Audio-Visual Workers

Contract labour means workers engaged through a contractor and not directly by the establishment. The establishment that takes the work is the principal employer. The contractor is the middleman who supplies the workers. The OSH Code, 2020 regulates this arrangement so that workers are not left without safety, wages or benefits.

The central rule is in section 57. Employment of contract labour in core activities of any establishment is prohibited. Core activity is the main work of the establishment. Non-core work, such as housekeeping or canteen service, is not caught by this prohibition.

The prohibition has exceptions. The principal employer may engage contract labour through a contractor even in a core activity if: (a) the normal functioning of the establishment is such that the activity is ordinarily done through a contractor; (b) the activity does not need full-time workers for the major portion of the working hours in a day or for longer periods; or (c) there is a sudden increase in the volume of work in the core activity that must be done in a specified time.

If there is doubt whether an activity is core, section 57(2) gives a route. The appropriate Government may appoint a designated authority to advise it. An aggrieved party can apply to the appropriate Government for a decision. The Government may refer the question to the designated authority, which reports, and then the Government decides within the prescribed period.

Two other worker groups get special protection. An inter-State migrant worker works in a State different from his own, so section 60 puts duties on the contractor or employer and section 61 gives a journey allowance. An audio-visual worker is protected by section 66, which requires a written and registered agreement. The Code repeals the Contract Labour (Regulation and Abolition) Act, 1970 and the Inter-State Migrant Workmen Act, 1979, among others (section 143).

Key rules to remember

Core activity prohibition (s. 57(1))
Contract labour in core activities = prohibited, unless exception (a), (b) or (c) applies
Exceptions: activity ordinarily done through contractor; no full-time workers needed for major part of working hours or longer periods; sudden increase of work to be done in a specified time.
Core activity dispute (s. 57(2))
Aggrieved party applies → appropriate Government → may refer to designated authority → authority reports → Government decides
The designated authority only advises. The decision is of the appropriate Government.
Duties for inter-State migrant workers (s. 60)
Contractor or employer must: (i) ensure suitable conditions of work; (ii) report fatal accident or serious bodily injury to authorities of both States and next of kin; (iii) extend all benefits available to other workers, including ESI and EPF, and medical check-up
The duty lies on the contractor or the employer of the establishment.
Journey allowance (s. 61)
Employer pays every inter-State migrant worker, in a year, a lump sum for the fare of the to-and-fro journey to native place
Minimum service, periodicity and class of travel are as prescribed by the appropriate Government. The duty is on the employer.
Audio-visual worker agreement (s. 66)
Written agreement + registration with the competent authority by the producer
Agreement must be in prescribed form. If a contractor is used, the producer is also liable for the contractor's default and can be reimbursed. Wages are paid through electronic mode.
Penalty (s. 97)
First contravention: penalty ₹50,000 to ₹1,00,000. Repeat conviction under same provision: imprisonment up to 3 months, or fine up to ₹2,00,000, or both
Covers orders regulating employment of women, audio-visual workers and contract labour.

How to solve Contract Labour, Inter-State Migrant Workers and Audio-Visual Workers questions

Use this method for any problem or theory question on contract labour, migrant workers or audio-visual workers.

  1. 1Identify the worker type: contract labour, inter-State migrant worker or audio-visual worker. Name the parties: principal employer, contractor, employer or producer.
  2. 2Quote the governing section: 57 for contract labour, 60 and 61 for migrant workers, 66 for audio-visual workers.
  3. 3For contract labour, ask whether the work is a core activity. If it is not, the section 57 prohibition does not apply.
  4. 4If the work is core, test the three exceptions in the proviso one by one against the facts.
  5. 5For a migrant worker, check the duty: working conditions, accident reporting, equal benefits, or journey allowance. Note who owes it.
  6. 6For an audio-visual worker, check the agreement: in writing, in prescribed form, registered by the producer, with the required contents.
  7. 7State the consequence: penalty under section 97 if the provision is contravened.
  8. 8Close with a one-line conclusion that answers the exact question asked.

Quickest way: Section-first scan

When to use it: Use when you have little time on a short-answer or case-based question.

  1. Match the facts to a section number: 57, 60, 61, 66 or 97.
  2. Write the rule in one sentence using the Code's own terms.
  3. Apply it to the facts in two or three lines.
  4. Conclude in one line and mention section 97 if there is a breach.

Common mistakes in Contract Labour, Inter-State Migrant Workers and Audio-Visual Workers

  • Saying contract labour is banned in all activities.

    Students remember the word prohibition and drop the word core.

    Fix: Write that the prohibition in section 57(1) is for core activities only, and then list the three exceptions.

  • Quoting a 50-worker threshold for contract labour from the old 1970 Act as if it still applies.

    Search habits and old notes carry over the earlier law.

    Fix: The 1970 Act is repealed by section 143. Answer on the OSH Code provisions, and do not state any threshold unless the question or the text given to you provides one.

  • Treating the designated authority as the decision maker on whether an activity is core.

    The two roles in section 57(2) look similar.

    Fix: The designated authority advises and reports. The appropriate Government decides.

  • Saying the journey allowance is paid by the contractor and is a fixed amount.

    Section 60 mentions the contractor, so students merge it with section 61.

    Fix: Section 61 puts the duty on the employer. It is a lump sum fare for a to-and-fro journey once a year. The details are prescribed by the appropriate Government.

  • Forgetting that the producer is liable when a contractor defaults on an audio-visual worker.

    Students focus on the contractor's agreement only.

    Fix: Remember section 66(2)(c): the agreement must say the producer will also discharge the obligations and can recover from the contractor.

  • Stating the section 97 penalty as imprisonment for the first offence.

    Both parts of section 97 are blended.

    Fix: First contravention is a penalty of ₹50,000 to ₹1,00,000. Imprisonment up to three months, or fine up to ₹2,00,000, or both, comes only on a repeat conviction under the same provision.

Worked examples

Example 1

Sundaram Textiles Ltd. wants to engage workers through a contractor for its main spinning activity. The activity is ordinarily carried out through contractors in this industry. Advise whether this is permitted under the OSH Code, 2020.

Show the solution
  1. Provision: section 57(1) prohibits employment of contract labour in core activities of any establishment.
  2. Facts: spinning is the main activity, so it is a core activity.
  3. Exception: the proviso allows contract labour in a core activity if the normal functioning of the establishment is such that the activity is ordinarily done through a contractor (clause (a)).
  4. Application: the facts say the activity is ordinarily done through contractors in this industry, so clause (a) is met.
  5. If Sundaram Textiles Ltd. is unsure whether the activity is core, an aggrieved party can apply to the appropriate Government under section 57(2).

Answer: Yes. Spinning is a core activity, so the general prohibition applies, but the proviso to section 57(1)(a) permits the engagement because the activity is ordinarily done through a contractor.

Example 2

Ramesh, from Bihar, works for Kaveri Constructions Pvt. Ltd. in Karnataka through a contractor. He is seriously injured at the site. Later he asks about his journey allowance. State the duties of the contractor or employer and of the employer.

Show the solution
  1. Ramesh works in a State different from his own, so he is an inter-State migrant worker and sections 60 and 61 apply.
  2. Injury: under section 60(ii), the contractor or employer must report a fatal accident or serious bodily injury to the specified authorities of both States and to the next of kin.
  3. Conditions and benefits: under section 60(i) and (iii), they must ensure suitable conditions of work and extend all benefits available to other workers of the establishment, including ESI and EPF benefits and medical check-up.
  4. Journey allowance: under section 61, the employer must pay in a year a lump sum amount of fare for a to-and-fro journey to the native place. Minimum service, periodicity and class of travel are as prescribed by the appropriate Government.
  5. Failure to comply attracts penalty under section 97: ₹50,000 to ₹1,00,000.

Answer: The contractor or employer must report the injury to the authorities of Bihar and Karnataka and to Ramesh's next of kin, and must give him the benefits of other workers. The employer must pay him the yearly lump sum journey fare under section 61, subject to the prescribed conditions.

Exam tips

  • Write the section number with every rule: 57, 60, 61, 66, 97. It shows precision to the examiner.
  • In case questions, test the three exceptions to the core activity prohibition one by one and say which one applies.
  • Use the order provision, facts, conclusion. End with a clear yes or no.
  • Do not bring in the repealed 1970 Act or 1979 Act, except to say they were repealed by section 143.
  • Learn who owes which duty: contractor or employer under section 60, employer under section 61, producer under section 66.

Practice questions from The Occupational Safety, Health and Working Conditions Code, 2020

Contract Labour, Inter-State Migrant Workers and Audio-Visual Workers in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Contract Labour, Inter-State Migrant Workers and Audio-Visual Workers: frequently asked questions

Is contract labour allowed under the OSH Code, 2020?

Yes, but not in core activities. Section 57(1) prohibits it there, subject to three exceptions. In non-core activities it is not caught by this prohibition.

Who pays the journey allowance to an inter-State migrant worker?

The employer pays it under section 61. It is a lump sum fare for a to-and-fro journey to the native place once in a year. Service period, periodicity and class of travel are as prescribed by the appropriate Government.

Who decides whether an activity is a core activity?

The appropriate Government decides. It may appoint a designated authority to advise it, and an aggrieved party can apply to it under section 57(2).

Which old laws did the OSH Code replace on these topics?

Section 143 repeals, among others, the Contract Labour (Regulation and Abolition) Act, 1970, the Inter-State Migrant Workmen Act, 1979 and the Cine-Workers and Cinema Theatre Workers Act, 1981. Answers must follow the Code.

What is the penalty for contravening these provisions?

Under section 97(1), the penalty is not less than ₹50,000 and may extend to ₹1,00,000. On a repeat conviction under the same provision, section 97(2) allows imprisonment up to three months, or a fine up to ₹2,00,000, or both.