Urgent Clarification Regarding Contractor - CiteHR
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Globaloverseas144
Soical Compliance Auditing
Shashi_shashigk@yahoo.com
Senior Hr Manager
Shefali.saxena
Hr Professional
Krishnavat75
Consultant - Hr
Sanagapalli
Labour Laws And Financial Matters
Anjaan
Service
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Hi,
Iam working as a HR Manager in a Manufacturing Company. I wanted to have a small clarification. If we are hiring employees nearly 25 from a manpower contractor. We are paying PF and ESI to the contractor. I wanted to clarify, if the contractor doesnt pay the PF and ESI to concerned department and fakes our company means who is the responsible for this. If any issue arises means who is responsible whether we are responsible or else the contractor. Based on the bill only we are going to release the payment. In that case how we will be responsible this is my question, because we are having a valid proof that we are giving the money to my contractor. Because we have the bill.
Kindly clarify me..
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Firstly......... has the contractor taken the licence from the office of Labour Commissioner to provide Contractual manpower to your outfit.
Secondly.....It is always the Principal employer who is responsible for all submission of ESI & PF. You can keep a tab on the Contractor by directing him to provide ESI & PF numbers of contractual manpower being supplied to you. Moreover you should also demand periodic returns submitted by him in regards to ESI & PF.
Thirdly........ Make an agreement with the Contractor on Stamp Paper which shall include all clauses related to ESI & PF.
if my contractor doesnt pay PF and ESI for the employees means now who is getting into trouble. As a employer we are getting into trouble or else my contractor. eventhough we have records showing that we paid necessary amount to my contractor to for pay PF and ESI. now who is in touble.
Hi,
I am completely agree with what shahid.kumar has shared. Moreover, you can have a practice of asking paid PF, ESI challans as an enclosure alongwith the bill for next month (without which you should not process the bill for payment) so as you can have cross check anytime with respective authority whether it has been complied with or not.
Mukesh T.
my question is this, if this problem is arised means. whom the government is going to claim whether me or else contractor
how a employer will get the problem because i already paid to the contractor. government as to claim only from the contractor right
what will be the consequence if he does not registered with pf and esi. and what will be the consequences if he registered with pf and esi
Dear Govind,
1.You ask the PF \ESI code no alloted copy from the contractor.
2.Instead of paying money to the contractor for ESI/PF directly , deduct the amount from his bill and you make the remittance on monthly basis on behalf of him.(You prepare the cheque on ESI/PF by yourself for contractor and add it along with his bill amount) by this way you can solve your headache.
3.Send a testmail to my id, i will forward you the contractor Audit sheet.

Hi,
I completely agree with Shahid & the comments backed up by the members. Its the sole responsibility of the contractor to pay this and you as a client are not answerable.
-Siddharth

hi govind suresh,
By giving the man power supply to contractors the company liability in r/o the statutory obligations does not dissolves. If you awarded a contract to another person also he will be get registered as your co. contractor only after issue of Form-V certificate duly filled and signed by your co. ofiicial stating that if any discrepancies in future about the statutory obligations you will be responsible to that effect. after that only the contractor wii get registered and starts the work in your co. Regarding the ESI & EPF compliances you must know whether his co. was registered undeer ESI& EPF Acts. If is not registered under the said Acts you must advise him to get registered and it is not possible in any case you must allow him to make compliance on your co. codes and you must see the correctness in compliances in any manner. Even though you are having bills the responsibility will not exhausts.
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