Casual Employment

Overview of Casual Employment

In India, casual employment refers to a type of employment in which an employee is hired temporarily, usually for a short period of time, to meet the needs of the employer. Casual employees do not have the same benefits as regular or permanent employees, such as job security, paid leave, or social security benefits.

Casual employment is common in India, particularly in the construction, agriculture, and manufacturing sectors. Casual employees may work full-time or part-time, and their wages are typically lower than those of regular employees.

Several laws and regulations in India govern the rights and obligations of casual employees. The Minimum Wages Act, 1948, for example, sets minimum wage rates for different industries and regions in India.

The Payment of Wages Act, 1936, requires employers to pay wages to employees on time and in the manner prescribed by law. The Payment of Bonus Act, 1965, provides for the payment of a bonus to employees in certain circumstances.

Despite these laws, casual employment in India remains controversial due to the lack of job security and benefits for casual workers. Many casual workers in India also face challenges in obtaining regular employment due to discrimination and other barriers.

Overview of Casual Employment Contract

A casual employment contract in India is a temporary employment agreement that does not have a fixed duration or a set number of working hours. The employee is hired casually, typically for a specific task or project.

Under a casual employment contract in India, the employee is paid hourly or daily and is not entitled to leave or holiday pay. The employer is not required to provide the employee with a fixed schedule or set working hours, and the employee may be terminated at any time without notice or severance pay.

In India, casual employment contracts are typically used for temporary or seasonal work, such as event staffing or construction projects. They are not suitable for long-term employment or for workers who need a consistent and stable source of income.

Benefits of a Casual Employment Contract

The benefits of a casual employment contract for a casual employee are mentioned below-

• An employment contract for casual employees provides administrative convenience to an employer. It puts him at less risk in case a casual employee in the future makes an unfair dismissal claim. In the absence of such an agreement, it will be tough for an employer to prove his legal standing should there be a dispute tomorrow
• Casual employment contracts allow for flexibility in terms of working hours and days, which may be appealing to those who need to balance work with other commitments or who prefer a more variable schedule
• A casual employment agreement contains in writing that the engagement with the casual employee is by a purely temporary pattern to suit a particular business need. Even though the employee is working in regular working hours, along with other permanent employees, the contract indicates that he does not have a permanent right as other ‘on roll’ employees. Setting such employment conditions in clear terms would help the employer to avoid any disputes in the future
• Casual employment contracts do not require a long-term commitment, allowing employees to work on a project-by-project or on-call basis. This may be appealing to those who prefer a more flexible working arrangement or who are not looking for a full-time job
• With all the terms and conditions of employment in written form, a casual worker contract helps to manage the expectations of the casual employees. They understand the boundaries of their responsibilities and entitlements well in advance, which, in turn, helps the management manage the working relationship with these employees.

Checklist for Casual Employment Contract

In general, casual employment contracts should include the following things-

• Job Title and Position- The job title and position for which the casual employee is hired should be mentioned in the contract
• Duties & Responsibilities- The contract should define the duties & responsibilities of the employee in no uncertain terms
• Working Days & Hours- The normal working days and hours about the casual employee must be mentioned in the contract. Usually, the working hours adhere to the Shops & Establishment Act
• Salary or Wages- The salary/wage to be paid to the casual employee should be mentioned clearly in the agreement. It may contain the hourly rate on normal days and holidays if there is any. The casual employee cannot be paid lower than the minimum wage specified by the concerned Indian Labour Laws from time to time.
• Termination of Employment- It is important even for casual employment contracts to have a termination clause. The terms and grounds on which the casual employee can be terminated should be mentioned clearly in the contract. Employee termination comes under the purview of several employment laws in India. Therefore, we would recommend you to consult a service lawyer while including this clause in the employment contract.
• Confidentiality and Non-Disclosure- If the responsibilities and the duties of the employee put him in such a position where he comes to be aware of certain confidential information and trade secrets, the contract needs to have an appropriate confidentiality & non-disclosure clause. Suppose more specialised employment involves extensive disclosure of highly confidential business information to the employee. In that case, he may also be asked to sign a separate non-disclosure agreement
• General Terms & Conditions- These may include the obligations and rights of both the employee and the employer, penalty conditions and other important terms and conditions for casual employees.

Points to Follow Before Entering Into a Casual Employment Contract?

A casual employment contract is an employment arrangement in which an employee is hired to work on an as-needed basis without a predetermined end date. There are a few steps you can follow to enter into a casual employment contract:

Please consider the following points while entering into an employment contract with your casual employees:

• Casual employees are entitled to ESIC Registration, PF, etc., as suggested by the relevant Indian laws
• There will be limitations of engaging casual employees in certain manufacturing processes
• Casual employees can be engaged for certain specific periods only
• You need to maintain complete records of your casual employees as well
• The casual employees, under no circumstances, can claim for any permanent employment.

Why Vakilsearch?

Vakilsearch has a team of experienced lawyers and chartered accountants who can draft you the perfect casual employment contract. It can be tailored to your organisation's needs. In comparison to other legal service providers, our fees are reasonable. With us, you won’t have to worry about the process since you can keep track of the status at every stage. We will be completely transparent throughout the entire process. If you have any queries, our customer support team will resolve your doubts.

FAQs on Casual Employment