Determining “Core” vs “Non-Core” Activity for Contract Labour Under the OSH Code
In one line: Section 57 of the OSH Code bars engaging contract labour in an establishment’s core activities — but the Code carves out 11 excluded activity categories and 3 proviso exceptions, so the prohibition is far from absolute.
Section 57 of the Occupational Safety, Health and Working Conditions Code, 2020 (“OSH Code”) imposes a blanket prohibition on engaging contract labour in the core activities of a principal employer’s establishment. Section 2(1)(p) defines “core activity” as any activity for which the establishment is set up — plus any activity essential or necessary to that primary activity. The definition is deliberately wide and sweeping.
The Statutory Basis
- Section 2(1)(p), OSH Code, 2020 — Definition of “core activity.”
- Section 57(1), OSH Code, 2020 — Prohibition on engaging contract labour for core activities, subject to a three-limb proviso.
- Contract Labour (Regulation and Abolition) Act, 1970 (Andhra Pradesh amendment) — State-level precedent for a similar core-activity restriction, pre-dating the OSH Code.
11 Activities Excluded From “Core Activity” — Even If Essential
Even where an activity is essential or necessary to the establishment’s functioning, the following are statutorily excluded from being treated as core activities:
| # | Excluded activity |
|---|---|
| 1 | Sanitation works — sweeping, cleaning, dusting, waste collection and disposal |
| 2 | Watch and ward services, including security services |
| 3 | Canteen and catering services |
| 4 | Loading and unloading operations |
| 5 | Running of hospitals, educational/training institutions, guest houses, clubs, and similar — where in the nature of support services |
| 6 | Courier services, where in the nature of support services |
| 7 | Civil and other constructional works, including maintenance |
| 8 | Gardening and maintenance of lawns and similar activities |
| 9 | Housekeeping and laundry services and similar, where in the nature of support services |
| 10 | Transport services, including ambulance services |
| 11 | Any activity of an intermittent nature — even if it would otherwise be a core activity |
The 3 Proviso Exceptions — When Contractors CAN Be Used for Core Activities
The proviso to Section 57(1) allows a principal employer to engage contract labour for core activities in three situations:
- Ordinarily contracted out: The establishment’s normal functioning is such that the activity is ordinarily done through a contractor.
- No full-time need: The activity doesn’t require full-time workers for the major portion of the working day, or over longer periods.
- Sudden volume spike: A sudden increase in the volume of core-activity work needs to be completed within a specified time.
Of the three, the first exception (“ordinarily done through a contractor”) is the one that carries the most practical weight — the other two are confined to narrow, fact-specific situations.
When a Worker Doesn’t Count as “Contract Labour” At All
The Codes narrow the definition of “contract labour” itself. A worker (other than a part-time employee) falls outside the definition if all three conditions apply:
- Regularly employed by the contractor for any activity of the contractor’s own establishment.
- Employment governed by mutually accepted standard conditions of employment, including engagement on a permanent basis.
- Receives periodical pay increments, social security coverage, and other welfare benefits.
How “Essential or Necessary” Has Been Interpreted
Since the OSH Code itself doesn’t elaborate further on “essential” or “necessary,” comparable reasoning from foreign jurisprudence is instructive (persuasive only, not binding, under Indian law):
- The US Supreme Court, in Steiner v. Mitchell, held that an activity qualifies as essential or necessary when it is so closely tied to the establishment’s functioning that it is indispensable to its performance, making it part of the “principal activity.”
- Illustrations from that reasoning: a machine operator’s routine oiling, greasing, or fitting a new cutting tool at the start of a shift is integral to the principal activity; similarly, a garment worker who arrives 30 minutes early to distribute materials and ready machines for other workers is performing a principal activity, not a peripheral one.
- In IBP, Inc. v. Alvarez, the same court held that any activity “integral and indispensable” to a principal activity is itself treated as a principal activity — reasoning that maps closely onto how “core activity” is worded under the OSH Code.
Interpreting “Ordinarily” in the First Exception
Indian courts have repeatedly interpreted the word “ordinarily” in comparable statutory contexts:
- It is not a rigid or “cast-iron” rule — it is flexible (Jasbhai Motibhai Desai v. Roshan Kumar).
- It excludes anything extraordinary or special (Eicher Tractors Ltd., Haryana v. Commissioner of Customs, Mumbai).
- It conveys the sense of something done “normally” (Krishan Gopal v. Prakashchandra) and “generally,” subject to special provision (Mohan Baitha v. State of Bihar).
Practical takeaway: To rely on the “ordinarily done through a contractor” exception, management must be able to show the activity has genuinely been carried out by contractor workers over a long, regular period — not as a recent or opportunistic workaround.
Frequently Asked Questions
What is a “core activity” under the OSH Code? Under Section 2(1)(p), a core activity is any activity for which the establishment is set up, plus any activity that is essential or necessary to that primary activity. The definition is deliberately wide.
Can contract labour be engaged for core activities at all? Generally no — Section 57 bars engaging contract labour in an establishment’s core activities. But three proviso exceptions and eleven statutorily excluded activity categories create meaningful flexibility.
Which activities are excluded from being treated as “core activities”? Eleven categories are excluded even if essential to the establishment, including sanitation, security/watch and ward, canteen and catering, loading and unloading, support-service hospitals/guest houses/clubs, courier support services, construction and maintenance, gardening, housekeeping and laundry support services, transport including ambulance services, and any intermittent-nature activity.
What are the three exceptions that let a principal employer use contract labour for core activities? Under the proviso to Section 57(1): (a) the activity is ordinarily done through a contractor as part of normal functioning, (b) the activity doesn’t need full-time workers for most of the working day or over longer periods, or (c) there’s a sudden spike in core-activity volume that must be completed within a specified time.
When does a worker not count as “contract labour” under the Codes? A worker is excluded from the contract labour definition if all three conditions are met: they are regularly employed by the contractor (not part-time), their employment follows mutually accepted standard conditions including permanent engagement, and they receive periodic pay increments, social security coverage, and other welfare benefits.
How do courts decide if an activity is “ordinarily” done through a contractor? Indian courts have held “ordinarily” means something done normally or generally, not as an inflexible rule, and it excludes anything extraordinary or special. In practice, management must show the activity has been carried out by contractor workers for a long, regular period to rely on this exception.
Verified by Labour Code Advisor’s compliance desk against the official gazette notifications. Last updated: .