CHANDIGARH — In a landmark move aimed at ending the decades-old exploitation of workers in the state, the Punjab Cabinet, chaired by Chief Minister Bhagwant Singh Mann, has approved a comprehensive policy to dismantle the contractual and outsourcing system across government departments.
The decision, hailed by the leadership as a “historic” step toward worker dignity and welfare, will directly impact more than 65,000 outsourced and contractual employees working across 51 government departments.
A Paradigm Shift in Employment
Under the new framework, the role of private contractors and middlemen will be completely eliminated. By transitioning workers into direct government-managed employment, the state aims to ensure job security, transparent wage disbursements directly into bank accounts, and benefits on par with regular government staff.
“The days of exploiting the common man and government employees are over,” Chief Minister Mann stated following the meeting. “This is not just a policy change; it is the beginning of a new chapter for thousands of families who will now receive the respect and security they deserve.”
Key Highlights of the Policy
To implement this reform, the Cabinet has approved the repeal of the Punjab Adhoc, Contractual, Daily Wage, Temporary, Work Charged and Outsourced Employees’ Welfare Act, 2016. Two new legislative bills will be introduced in the upcoming monsoon session of the Vidhan Sabha:
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The Punjab State Outsourced Personnel (Transition to Contractual Engagement) Bill, 2026
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The Punjab Contractual Personnel (Absorption Against Sanctioned Vacancies) Bill, 2026
Eligibility and Timeline
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General Employees (Group C & D): Eligible for transition to direct government contracts after completing 5 years of continuous service.
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Hazardous Category: A major relief has been granted to workers in high-risk professions, including firemen, sewermen, linemen, and sanitation staff, who will be eligible for transition after only 3 years of service.
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Long-term Goal: Once transitioned to direct government contracts, employees will be eligible for consideration for permanent absorption into sanctioned posts after completing 10 years of service.
Cracking Down on Corruption
In addition to the employment reforms, the Cabinet has approved the establishment of seven new special courts dedicated to the speedy disposal of corruption cases. These courts will be strategically located in Mohali (3), Jalandhar, Ludhiana, Amritsar, and Patiala. This move is part of the government’s broader “zero-tolerance” policy toward graft in public administration.
Resolving Financial Grievances
To address long-standing financial issues for staff and retirees, the Cabinet has also reconstituted a ministerial sub-committee tasked with resolving pending Dearness Allowance (DA) and pension arrears.
The government is expected to begin notifying eligible categories and phased implementation within the next 45 days under the supervision of a committee led by the Chief Secretary.
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