In a major relief to Food Corporation of India (FCI), the labour ministry has allowed the organisation to hire contract workers in its 226 depots where only ‘departmental labourers’ are currently engaged with an average monthly salary exceeding `1 lakh.
Sources told FE that through a recent notification, the labour ministry has exempted these FCI depots or godowns from the purview of contract labour (regulation and abolition) Act of 1970 for a period of two years, thus allowing the corporation flexibility in hiring contract labour as per its need.
This move by the labour ministry would allow FCI to transfer around 15,000 departmental labourers on its rolls to other depots as per the requirement. It is expected to result in savings of `600 crore in its wage bill. Once the regular workers are transferred to other depots, they will be deprived of the extra money they currently get by engaging in proxy labour.
At present, the corporation’s annual labour expenses are around `4,600 crore.Meanwhile, the FCI workers’ union has called for a day of protest against the corporation’s move on August 19. Due to regulations against hiring contractual labour, FCI till now has about 15,000 workers under the ‘departmental labour’ category, who have been drawing an average monthly salary of more than `1 lakh in FY15 for loading and unloading of foodgrain sacks at more than 200 FCI depots. A chunk of departmental labourers has also been drawing monthly salaries of more than Rs 2 lakh.
“Because of restriction against hiring contract labour, these departments hire proxy labourers to carry out loading and unloading of foodgrain, thus earning a huge amount of incentive as the average monthly salary,” an official said, adding that because of seasonality of FCI works, especially during procurement seasons, hiring contractual labour would greatly reduce the cost of operations.
Out of the 48,000 workers attached to FCI’s 1,600-odd depots located across the country, 15,000 are employed as ‘departmental labour’. They drew an average salary of more than `1 lakh per month in 2014-15.
More than 25,000 workers are engaged under ‘Direct Payment Labour System’, where the average monthly salary was `35,000 in FY15 while the rest of the 7,000 odd workers are employed under the ‘no work no pay’ system where the average monthly payment for each labour was `7,000 in FY15. In a judgment earlier this year, the Supreme Court had stated that there was something “seriously wrong” with FCI where departmental labourers were paid substantially higher amount as monthly salary compared to other category workers.
The SC in an observation last month had allowed FCI to transfer the services of departmental labourers from one depot to another subject to “protecting their salary and all other service conditions”. On the issue of departmental workers getting substantially higher salaries, the high-level committee on FCI restructuring chaired by former food minister Shanta Kumar in its 2015 report had stated: “This happens because of the incentive system in notified depots and widely used proxy labour.”
