Building and Construction Workers — Labour Law II Notes

Building and Construction Workers

Look at any city skyline going up and you see the most invisible workforce in India — the men and women on the scaffolding, hired for one project, gone to the next, with no employer to call their own. Construction is huge, dangerous and utterly unorganised, so the law gives it a scheme of its own.

The dedicated welfare scheme (CSS Chapter VIII)

Building and construction workers are covered by Chapter VIII of the Code on Social Security, 2020 (carrying forward the Building & Other Construction Workers Act, 1996). The scheme is cess-funded and board-delivered:

State Building Workers’ Welfare Boards (Section 7, read with Chapter VIII) — each State constitutes a tripartite Welfare Board to run the scheme.
Cess (Sections 100–104) — a cess (a small percentage of the cost of construction) is levied on every employer of a building/construction project and collected for the Fund; self-assessment, interest on delay and penalties for non-payment are provided.
Registration of beneficiaries (Section 106) — a construction worker aged 18–60 who has worked the qualifying period may register with the Board as a beneficiary (with cessation as a beneficiary on default/age — Section 107).
Welfare Fund and benefits (Section 108) — the cess feeds a Building and Other Construction Workers’ Welfare Fund, out of which the Board provides accident cover, pension, disability aid, housing loans, medical and maternity assistance, and education aid for the worker’s children.

Section 100, Code on Social Security 2020 (in brief): “there shall be levied and collected a cess … at such rate not exceeding two per cent. but not less than one per cent. of the cost of construction incurred by an employer …” for the welfare of building and other construction workers.

In Simple Terms: Every building project pays a cess on its construction cost; that money fills a State welfare fund; a Welfare Board registers workers aged 18–60 and pays them accident, pension, housing, medical, maternity and education benefits. It is social security for a workforce with no single employer.

🧩 WORKED EXAMPLE — a registered construction worker’s accident

Facts. A registered construction worker aged 40 is injured in a fall on site.

Rule. A worker registered as a beneficiary (aged 18–60) may claim benefits from the cess-funded Welfare Fund, including accident/disability assistance (Ch VIII).

Apply. As a registered beneficiary, he claims accident/disability benefit from the Board’s fund — independent of any single employer.

Conclusion. He is entitled to benefits from the Welfare Board’s fund; the scheme works because the cess pre-funds it.

flowchart TD
    ROOT["Building & Construction Workers (CSS Ch VIII)"]:::root
    ROOT --> CESS["Cess 1-2% of construction cost (ss.100-104)"]:::leaf
    CESS --> FUND["Welfare Fund (s.108)"]:::leaf
    ROOT --> BOARD["State Welfare Board (s.7)"]:::leaf
    BOARD --> REG["Register worker 18-60 (s.106)"]:::leaf
    FUND --> BEN["Accident, pension, housing, medical, maternity, education"]:::pay
    classDef root fill:#FFF8DC,stroke:#000,stroke-width:1px,color:#000;
    classDef leaf fill:#E6F3FF,stroke:#1E3A8A,color:#000;
    classDef pay fill:#E7F6E7,stroke:#217a21,color:#000;
    linkStyle default stroke:#888,stroke-width:1px;

Case Laws

National Campaign Committee for Central Legislation on Construction Labour v Union of India (2018) — directed States to actually collect and spend the construction cess for workers’ welfare; the fund must reach the worker.
Dewan Chand Builders v Union of India (2012) — upheld the construction-welfare cess as a valid fee for the workers’ benefit.

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