Punjab Chief Minister Bhagwant Singh Mann on Saturday announced a historic decision to end the contractor system in Punjab Government departments, paving the way for more than 65,000 outsourced workers to come directly under the government and creating a clear pathway towards regular employment. The Chief Minister said the move would free thousands of workers from exploitation by private contractors, ensure direct government employment and provide long-awaited job security, dignity and benefits to employees who have devoted years of service to the state.
Addressing a press conference, CM Bhagwant Singh Mann said Punjab Government has approved the repeal of the Punjab Adhoc, Contractual, Daily Wage, Temporary, Work Charged and Outsourced Employees’ Welfare Act, 2016, and cleared the Punjab State Outsourced Personnel (Transition to Contractual Engagement) Bill, 2026 and the Punjab Contractual Personnel (Absorption Against Sanctioned Vacancies) Bill, 2026. “More than 65,000 contract workers of Punjab have given the best years of their lives in the service of the state. With this decision, Punjab has returned to them what is rightfully theirs. No contractor will now stand between these employees and the state,” he said.
The Chief Minister said the Punjab Government has taken this landmark step to ensure that government employees are no longer forced to work through contractors and outsourcing agencies. “The reform fulfils a long-pending demand of thousands of workers and establishes a transparent mechanism under which outsourced employees can eventually become regular government employees,” he added.
“These employees will now have direct employment, full dignity and a clear pathway to permanence. Workers presently engaged through private contractors in Punjab Government departments and entities will be taken directly into the state’s own employment, eliminating the middleman contractor system,” said CM Bhagwant Singh Mann.
Explaining the framework, the Chief Minister said outsourced Group C and Group D employees who have completed five years of continuous service will be brought directly under government contractual employment. Employees working in hazardous categories will become eligible after completing three years of service.
“Direct state employment will be provided after five years of continuous outsourced service. Thereafter, after completing ten years of contractual service, employees will be considered for absorption against regular sanctioned posts. Two new legal frameworks are being brought in, one for moving from outsourced employment to direct state contract and another for moving from state contract to the regular cadre against sanctioned vacancies,” said CM Bhagwant Singh Mann.
Highlighting the scale of the initiative, the Chief Minister said. “A total of 65,048 outsourced workers across 51 departments will benefit from this reform and more than 26,000 workers will be among the first beneficiaries.”
The Chief Minister further announced special provisions for employees engaged in hazardous duties. “Workers whose daily duties involve danger will be considered after three years instead of five years. These include Fire Services personnel, PSPCL linemen, sewer workers, sanitation workers of Urban Local Bodies, waste-handling workers and field complaint staff,” he said.
Detailing the sectors covered under the reform, the Chief Minister said it includes 15,753 workers in the power sector, including complaint-handling staff, PESCO employees, meter readers and nodal centre workers; 8,436 workers in Local Government departments, primarily sanitation staff; 8,373 workers in cooperative institutions including sugar mills, Spinfed and Markfed; 7,704 workers in School Education; 4,746 workers in the Transport Department; and 1,472 outsourced fire personnel.
Besides this, 2,688 workers of Health and Family Welfare, 1,575 workers of Water Supply and Sanitation, 1,533 workers of Agriculture, 1,311 workers of Jails, 1,251 workers of Technical Education, 1,570 workers of PWD (B&R), 1,322 workers of General Administration and 1,231 workers of Medical Education will also benefit from the reform.
“Workers will now have a direct employer-employee relationship with the state. Contractors will no longer exist in this arrangement. The exploitation of outsourced workers by contractors will come to an end and employees will receive all benefits directly from the government,” said CM Bhagwant Singh Mann.
The Chief Minister said, “Wages will be credited directly into employees’ bank accounts without any agency deductions or commissions. Employees will receive statutory maternity benefits and ten days of casual leave every calendar year. They will also be covered under biometric attendance and iHRMS systems.”
Emphasising employee protections, the Chief Minister said Punjab Government has ensured safeguards against arbitrary action. “There will be transparency and protection from arbitrary action. No worker will be removed without reasons being recorded in writing and without being given an opportunity to be heard,” said CM Bhagwant Singh Mann.
The Chief Minister said the implementation process would begin within 45 days and eligible categories would be notified in phases by the Departments of Personnel and Finance. “A state-level Empowered Committee headed by the Chief Secretary will monitor implementation of this decision. While many states are moving towards greater contractualisation, Punjab is reversing that trend and ending the contractual system,” said CM Bhagwant Singh Mann.