Employment Act 1968 · 2020 Revised Edition · Part 6 · Contractors and Contracting
65. Liability of principals, contractors and subcontractors for salary of workman
Feedback & supportLast amended by an amending law of 2016.
Where a principal, in the course of or for the purposes of or in pursuance of or in furtherance of the interests of the principal’s trade or business, contracts with a contractor for the supply of labour or for the execution by or under the contractor of the whole or any part of any work undertaken by the principal, and any salary is due to any workman by the contractor or any subcontractor under the contractor for labour supplied or for work done in the course of the execution of such work, the principal and the contractor and any such subcontractor (not being the employer) are jointly and severally liable with the employer to pay the workman as if the workman had been immediately employed by the principal, and where salary is claimed from the principal, this Act (with the exception of section 33 relating to priority of salary) applies as if reference to the principal were substituted for reference to the employer, except that salary claimed is to be calculated with reference to the salary of the workman under the employer by whom the workman is immediately employed.
principal
“principal” means any person who, in the course of or for the purposes of the person’s trade or business, contracts with a contractor for the supply of labour or for the execution by the contractor of the whole or any part of any work undertaken by the principal;
No principal, contractor or subcontractor, not being the employer, is jointly and severally liable to any workman under subsection (1) for more than the salary earned in one month for work done by the employer.
contractor
“contractor” means any person who contracts with a principal to supply labour or to carry out the whole or any part of any work undertaken by the principal in the course of or for the purposes of the principal’s trade or business;
In the case of a contract for constructional work, the principal is not liable for the payment of salary under subsection (1) unless the principal is also a constructional contractor.
constructional work
“constructional work” means any building and civil engineering work and includes repair, maintenance, alteration and demolition work;
[Deleted by Act 21 of 2016 wef 01/04/2017]
A workman who wishes to recover any salary from a person liable under this section for the salary must, before lodging a claim for the salary under section 13 of the Employment Claims Act 2016, submit to the Commissioner, under section 3(1) of that Act, a mediation request for the mediation under Part 2 of that Act of every dispute for which the claim will be lodged.
workman
“workman” means —(a)any person, skilled or unskilled, who has entered into a contract of service with an employer pursuant to which he or she is engaged in manual labour, including any artisan or apprentice, but excluding any seafarer or domestic worker;(b)any person, other than clerical staff, employed in the operation or maintenance of mechanically‑propelled vehicles used for the transport of passengers for hire or for commercial purposes;(c)any person employed partly for manual labour and partly for the purpose of supervising in person any workman in and throughout the performance of his or her work:Provided that when any person is employed by any one employer partly as a workman and partly in some other capacity or capacities, that person is deemed to be a workman unless it can be established that the time during which that workman has been required to work as a workman in any one salary period as defined in Part 3 has on no occasion amounted to or exceeded one‑half of the total time during which that person has been required to work in such salary period;(d)any person specified in the First Schedule; or(e)any person whom the Minister may, by notification in the Gazette, declare to be a workman for the purposes of this Act.
The workman must submit the mediation request to the Commissioner within 60 days after the date on which the salary becomes due for payment in accordance with Part 3.
mediation request
“mediation request” has the meaning given by section 2(1) of the Employment Claims Act 2016;
The Commissioner may extend the period under subsection (2A) within which the workman must submit the mediation request to the Commissioner.
However, if a workman has lodged, before 1 April 2017, a claim under section 119 for any salary against a person liable under this section for the salary —
salary
“salary” means all remuneration including allowances payable to an employee in respect of work done under his or her contract of service, but does not include —(a)the value of any house accommodation, supply of electricity, water, medical attendance, or other amenity, or of any service excluded by general or special order of the Minister published in the Gazette;(b)any contribution paid by the employer on his or her own account to any pension fund or provident fund;(c)any travelling allowance or the value of any travelling concession;(d)any sum paid to the employee to reimburse him or her for special expenses incurred by him or her in the course of his or her employment;(e)any gratuity payable on discharge or retirement; and(f)any retrenchment benefit payable on retrenchment;
subsections (2), (2A) and (2B) do not apply to the recovery of the salary under that claim; and
instead, the repealed section 65(1C) and (2) as in force immediately before 1 April 2017 continues to apply to the recovery of the salary under that claim.
Nothing in this section prevents any principal or contractor or subcontractor, not being the employer, who as the result of a claim made under this section has paid any salary to a workman, from instituting civil proceedings for the recovery of the amount of salary so paid from the employer of that workman.
subcontractor
“subcontractor” means any person who contracts with a contractor for the supply of labour or for the execution by the subcontractor of the whole or any part of any work undertaken by the contractor for the contractor’s principal, and includes any person who contracts with a subcontractor to supply labour or to carry out the whole or any part of any work undertaken by the subcontractor for a contractor;
Nothing in this section prevents a workman from recovering salary under this Act from his or her employer instead of the principal or contractor or subcontractor.
employer
“employer” means any person who employs another person under a contract of service and includes —(a)the Government in respect of such categories, classes or descriptions of officers or employees of the Government as are declared by the President to be employees for the purposes of this Act;(b)any statutory authority;(c)the duly authorised agent or manager of the employer; and(d)the person who owns or is carrying on or for the time being responsible for the management of the profession, business, trade or work in which the employee is engaged;
The reference to principal in this section includes a reference to the Government or a statutory body or authority acting in the course of or in the discharge of its functions.