You will not be liable in this case only the third party will be prosecuted
Unfair employee markup charges by 3rd party service providers
Hi We had hired a number of people using a 3rd party service provider, whom we paid $x/hour for each employee, but later we found out that the 3rd party company was paying these employees X-50%/hr as payment. Are there any protection or disclosures for this employee that protects them from such abuse? Thanks,
Asked 5 years ago in Labour
10 Answers
But what could be the consequences for the 3rd party? I am planning to go after the 3rd and support the employee to their fair compensation. Is there a range of fair markup compensation? Is there any disclosure that needs to be provided to both employees and me by the 3rd party?
Asked 5 years ago
In this case the only the employees of 3rd party will have a locus against that third party for non disclosure. You can only catch hold the third party for any breach of terms of contract of agreed amongst you
Ok thank you for clarification, but are there any general standards or laws that are breached here. Is there a general industry standard for a compensation mark up?
Asked 5 years ago
Industrial dispute Act or Factories Act, shop & establishment Act depending on nature of industry
You can terminate services of the service provider if employees are not being paid full salary
It is necessary to peruse your contract with third party and the contract for employment between service provider and employees to advice
It would depend upon terms of employment between service provider and employee
It is the 3rd party service provider duties to provide proper payment to each employee as per their agreement with employee. As per your agreement the service provider get the amount from you. There are two agreements governs here. If you are worried about the salary then only remedy available is put and end to the contract between service provider. And make a new agreement with employee.
The service providers have hired the employees on contract basis with terms and conditions.
The employees have signed the contract agreeing to the terms and conditions set out in the contract.
Therefore you should not be concerned about the remunerations paid by the service provider to his contractual employees, it is none of your business.
If the services of the employees are not satisfactory, you can raise this issue and also can terminate the contractual agreement with the service provider.
You cannot interfere in his affairs with his own contractual employees.
The employees who are affected have to raise the issue of low salary paid to them.
They can very well quit the job for being lowly paid.
You have not employed them directly.
You have outsourced this arrangement to a service provider.
Therefore you cannot raise a voice in favor of the affected employees.
You have to honor your agreement with the service provider, any such interference would be termed as breach of contract, hence you may better analyze the situation and keep yourself away from such unnecessary things or else you may have to face problems which may be an obstacle or hindrance to the progress of your own business or future prospects.
You maintain the records of the salary payment made to the service provider for onward transmission to the employees hired in your establishment.
You cannot be held liable for the so called unjustified acts by the service provider to the employees deployed in your organization.
If at all there is any labor law problem raised by the affected employees, you can produce the records and can keep away from the problems