Section 49: Revocation, suspension and amendment of licence

The Occupational Safety, Health and Working Conditions Code, 2020 (Act No. 37 of 2020) • Official Statutory Text & Plain English Practice Guide

Statutory Mandate
Chapter IX: Contract Labour & Inter-State Migrant Workers
Competent Labour Forum
Act No. 37 of 2020

Legal Commentary & Landmark Judgments: Section 49

Section 49 of the Occupational Safety, Health and Working Conditions Code, 2020 strictly prohibits contractors and employers from charging, deducting, or recovering any recruitment fee, placement commission, or statutory safety equipment cost directly or indirectly from contract workers.

  • Zero-Cost Recruitment Principle: Enacts an absolute statutory prohibition barring contractors, sub-agents, or principal employers from demanding or collecting any recruitment fees, placement charges, or administrative deductions from contract workers.
  • Free Provision of Safety Equipment & Welfare: Statutorily mandates that all personal protective equipment (PPE), safety gear, medical examinations, and welfare amenities must be provided entirely free of cost, with zero deduction from worker wages.
  • Criminal Penal Sanctions & License Revocation: Extracting fees or making illegal deductions from contract workers constitutes a grave statutory offense, triggering immediate license revocation under Section 51, blacklisting, and criminal prosecution.
Key Landmark Precedents:
  • People's Union for Democratic Rights v. Union of India (1982) 3 SCC 235: Supreme Court held that deductions by labor contractors or intermediaries (jamadars) from workers' wages constitute forced labor prohibited under Article 23 of the Constitution.
  • Sanjit Roy v. State of Rajasthan (1983) 1 SCC 525: Supreme Court affirmed that paying less than statutory minimum wages or deducting administrative fees from labor remuneration infringes the fundamental right to live with human dignity under Article 21.
Courtroom Practice & Strategic Litigation Guidance:

Principal employers must mandate strict anti-recruitment fee covenants in all Master Service Agreements (MSAs) with staffing vendors. Conduct quarterly anonymous worker interviews and audit contractor payroll accounts to confirm that no contractor supervisor has extracted placement fees, uniform costs, or PPE deductions from contract labor.