Supreme Court Quarterly Digest 2026 - Labour Law

Labour Law - Supreme Court Quarterly Digest Jan - Mar, 2026 Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 (BOCW Act) and The Building and Other Construction Workers' Welfare Cess Act, 1996 (Cess Act) — Implementation and Levy: Held, that although the BOCW Act and Cess Act were enacted in 1996, they remained "dormant" in various states until the necessary machinery, specifically the Welfare Boards under Section 18, was constituted - The constitution of Welfare Boards is a sine qua non (condition precedent) for the levy and collection of cess - While the registration of workers is not a prerequisite for collecting cess, the existence of a Board to receive and utilize the funds is essential. [Paras 36, 50, 59] National Highways Authority of India v. Gammon Atlanta (JV), 2026 LiveLaw (SC) 71 : 2026 INSC 76 Contract Labour (Regulation and Abolition) Act, 1970 – Section 10 – Sham vs. Genuine Contracts – Following the Constitution Bench in SAIL, Supreme Court reiterated that the prohibition of contract labour does not lead to automatic absorption - if a contract is found to be a "sham" or "camouflage" intended to bypass labour laws, the workers are treated as de facto employees of the principal employer - Such a determination involves disputed questions of fact that must be adjudicated by the Industrial Tribunal/Court, not a Writ Court – Appeal dismissed. [Relied on Steel Authority of India Limited (SAIL) v. National Union Waterfront Workers (2001) 7 SCC 1; Shambu Nath Goyal v. Bank of Baroda (1978) 2 SCC 353; Paras 24-40] Premium Transmission v. State of Maharashtra, 2026 LiveLaw (SC) 86 : 2026 INSC 87 Contract Labour – Sham Contracts and Regularization – If a contract is proved to be a "camouflage" or "sham" to hide a real employer-employee relationship where the principal employer retains full control, the workers must be treated as direct employees and regularized - determining whether a contract is "sham" or "genuine" involves disputed questions of fact that must be adjudicated by the Industrial Tribunal/Court, not by Writ Courts under Article 226 – Appeal allowed. [Relied on Steel Authority of India Ltd. and others v. National Union Waterfront Workers and others (2001) 7 SCC 1; Paras 8-11] Premium Transmission v. Kishan Subhash Rathod, 2026 LiveLaw (SC) 87 Domestic Workers' Rights – Minimum Wages – Separation of Powers – Petitioners sought a writ of mandamus declaring that domestic workers have a fundamental right to minimum wages under Articles 21 and 23 and challenging their exclusion from the Minimum Wages Act and Code of Wages, 2019 - Held: Supreme Court declined to issue a positive mandamus for the enactment of law, emphasizing the doctrine of separation of powers - While acknowledging the vulnerable status of domestic workers and the lack of legislative protection, noted that an enforceable decree cannot be passed if it requires the legislature to enact a specific law - Supreme Court impressed upon State Governments to consider the grievances highlighted by the petitioners and urged the development of suitable mechanisms to prevent exploitation and ensure minimum wages. [Relied on Ajay Malik vs. State of Uttarakhand and another [(2025) INSC 118]; Paras 2-8] Penn Thozhilalargal Sangam v. Union of India, 2026 LiveLaw (SC) 124 Employees' Compensation Act, 1923; Section 4A(3)(b) — Liability to pay Penalty — The Supreme Court reiterated that while an Insurance Company is liable to indemnify the employer for the principal compensation amount and interest, it cannot be fastened with the liability to pay the penalty component - Noted that the penalty under Section 4A(3)(b) is imposed due to the "personal fault and negligence" of the employer for failing to deposit compensation within the stipulated one month. New India Assurance Co. Ltd. v. Rekha Chaudhary, 2026 LiveLaw (SC) 187 : 2026 INSC 177 Employees' Compensation Act, 1923 - Statutory Interpretation — Section 4A — Following the 1995 Amendment, the components of compensation/interest (Clause 'a') and penalty (Clause 'b') have been severed - The legislative intent behind this severance was to ensure that the burden of penalty which is not a natural corollary of the indemnity contract remains a deterrence for the employer rather than being passed onto the insurer - The Supreme Court set aside the High Court's order regarding the penalty. It held that the employer (Respondent No. 4) is solely liable to pay the penalty amount of Rs. 2,57,838/- within eight weeks. [Relied on Ved Prakash Garg v. Premi Devi (1997) 8 SCC 1; Paras 10-22] New India Assurance Co. Ltd. v. Rekha Chaudhary, 2026 LiveLaw (SC) 187 : 2026 INSC 177 Employer-Employee Relationship – Sham or Camouflage – Held that mere fact that the same individuals continued to work for the principal employer despite periodic changes in...

Supreme Court Quarterly Digest 2026 - Labour Law

LIVELAW NEWS NETWORK

This is a premium content
Available exclusively to
Our subscribers

INR 1099+GST

Tags

Supreme Court Quarterly Digest 2026 - Labour Law

LIVELAW NEWS NETWORK

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

This is a premium content
Available exclusively to
Our subscribers