Cooperative labour Contract Societies: RBE No.300/1985 – Award of Contracts

No.84/E (Coop.)/14/4, dated 15.11.1985

Sub: Award of Goods Parcel Handling Contracts to Cooperative labour Contract Societies – Revision of rates during the currency of the contracts.        

1. According to the Board’s letter No.66/E (Coop)/L/2/4, dated 27.11.1968 read with Board’s letter No.72/E (Coop)/L/1/5, dated 21.09.1973, the contract of goods, parcels, coal handling, removal of coal ashes, ash pit cleaning, cinder picking can be awarded to available and willing genuine Labour Cooperative Societies of actual workers with not more than two outsiders without call of tenders. In such cases, the rates are recommended with regard to local conditions, taking into consideration the minimum wage rate fixed for labour by the local authority, or where it does not exist, the market rate, the statutory obligations such as weekly off, bonus, etc., volume of work and all other relevant factors, by a Committee of three officers not below the rank of senior scale, one of whom should be an Accounts Officer, and put up to the competent authority for approval.

2. It was also decided vide Board’s letter No.78/E (Coop)/14/3, dated 02.08.1980 that the handling contracts would be covered under “Conveyance of materials” provided in para 401-S. Accordingly, the revision of rates/ annual fixation of rates in respect of handling contracts, wherever circumstances warrant, are required to be done in terms of para 401-S in consultation with Finance and with the approval of the competent authority. It was also clarified vide Board’s letter No.78/E (Coop)/14/3, dated 14.09.1979 that the three years term of award of Goods and  Parcel Handling Contracts was not a rigid order and was in the nature of a guideline so as to avoid frequent calling of tenders and fixation of rates for handling purposes, and as the duration of a contract is matter to be settled between the parties to the contract, Railway Board had no objection to the conclusion of the contracts for one year instead of 3 years period.

3. Certain Railways have represented that para 401-S read with 440-S places a restriction on them for upward revision in rates involving not more than 5% excess over the total value of the handling contract. However,  in many cases, the upward revision in fair/ minimum wages announced  by the local authorities are so high as to call for revision in rates in excess of 5% of the total value of the handling contract which the Railways are unable to meet due to said restriction of 5% provided for in the Stores Code.

The Board have considered this issue and have now decided that in case there is an increase/ decrease in minimum fair wages notified by the local authority during the currency of the contractual period of any labour cooperative society, the handling contract rate may be adjusted accordingly to account for the increase/ decrease liability on the cooperative societies on this account. The procedure to be followed for recommending/ approving such revisions in the contract rates will be the same as prescribed for original award of the contract i.e. the Committee of 3 senior scale officers will take into account the variation on account of labour rates amended by the State authorities. If considered necessary, a  provision  to  this effect  may be included in the agreement entered with the Labour Handling Cooperative Societies.

4. These orders will take effect from the date of issue of this letter.

5. This issues with the concurrence of the Finance Directorate in the Ministry of Transport, Department of Railways (Railway Board).

Download Railway Board Circular RBE No.300/1985

Forward reference ⇒ RBE No.