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TeamLease Contact Service, the blue collar employment unit of TeamLease Services Private Limited, has won contracts from four Pune-based auto ancillary companies that potentially allow creation of 2,000 new jobs in the next three months, a news release from the company said.
Labourers are to be sourced from Nashik, Satara, Saurashtra, Vidharba and to an extent sub-contractors and smaller villages around Pune. TeamLease will provide a labour law expert to interface with the employers, as well as supervisors to take care of the day-to-day needs of the labourers.
Sangeeta Lala, vice-president, TeamLease Contract Service, said, "Markets are slowly but steadily waking up to hiring accredited firms to take charge of their factory floor manpower needs. The shift in service to an accredited firm vis-a-vis local contractors can be attributed to two reasons- to ensure complete compliance and process standardization as required by the Contract Labour (Regulation and Abolition) Act 1970 and the penalty for non-compliance."
It is estimated that 93 per cent of the 400 million employed in India is in the unorganised sector, which is predominantly the blue collar segment. The unorganised sector is completely outside the purview of most labour laws and this includes social security, the release said.
The extent of the 'damage' to the exchequer due to a large unorganised sector (tax revenues) in 2005-06 in the manufacturing sector GDP was Rs 514,002 crore (advanced estimates) at current prices, it said, adding that about 32 per cent of this (about Rs 162,000 crore) is accounted for by unregistered or unorganised manufacturing units.
Hence the need to formalise the informal sector, according to TeamLease. The company said the reality in blue collar 'temping' today is that there is no single organised 'contractor' at a national or local level. Many of the so-called contractors offer this as an added service with other businesses, minus the required bandwidth or focus on service delivery standards.
This has left a huge gap in the market in compliance, adherence and workers' welfare. The need to bridge this gap has prompted TeamLease to extend its service offerings into this space, it said.
TeamLease will act as the statutory employer of the workers and manage all employee benefits, day-to-day HR administrative activities like attendance and leave.
After the selection process, a substantial amount of familiarisation of employee benefits like wage structure, statutory coverage such as provident fund (by the Employees Provident Fund Organisation or EPFO), insurance (by the Employees State Insurance Corporation or ESIC) needs to be done with the workers, since the majority at that level have never received such benefits or are first-time job seekers.
The workers also undergo induction training at the time of joining, which addresses employment-related issues, safety policies and provision of basic welfare amenities like first aid. Specific skills training, if required, can be facilitated by TeamLease.
Typically, under local contractors, once the fixed term of employment is completed, they are forced out of the system (240 days as per the Industrial Dispute Act).
As a result, they end up with no jobs or get jobs in unrelated fields, and skill development never reaches maturity. However in the case of TeamLease, workers are moved to another organization that requires similar skill sets, and this helps to develop a skilled workforce, the release said.
