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Dear All,
I am working with a hotel. Here there are some employees who are not on our payroll rather on the contractor's payroll.so my question is we are paying the contractor the amount of his services rendered but has asked him to pay the esi/epf for the employees on his payroll.If he does not do the same then is it the responsibility of the principal employe to do it?
Please answer me the same as soon as possible.
With trgards
Archana Shukla
From India, New Delhi
Dear Archana,
Always remember. Contractor can escape anytime. Thus the principal employer is accountable for everything as far as anything pertaining to the contract labour management is concerned.
Ask your contractor to produce PF and ESI challans everymonth and if he fails to do so, hold back the payment payable to him.
From India, Ahmadabad
Dear Archana,
Yes. Zubin said correct so pls aware of the Contractor.
But ask your contractor whether they having more than 20 contract labour, If they said no what are the benefits avail.
From India, Madras
yes archana ji, you will be in trouble if you do not comply to what ia sais above. For any clarifications & details, please write to me. Pradeep Sharma Associate Manager MFPL
From India, Mumbai
hi archana yes it is must if the contractor will not deposit the ESI,PF then being a principal employer u have to deposit the amount with fine. so better tell contractor to produce there monthly return challan copy of every month before clearance of there Bill. or deduct the PF ESI amount from there Bill & clear rest amount and deposit own.
secondly for siva since the principal employeer have the PF, ESI code so the question of 20 is not arise for there . even though contractor will deploy 2 labour they have to deposit Pf,ESI of 2 people since employer have own PF,ESI .
Ratikanta Rath
From India, Angul
yes, it is the responsibity of principal employer to check that contractor is deducting it and penalty will be imposed on principal employer if contractor does any negligency in deducting esi, pf .
From India, Hapur
yes , u have to check out all the legal compliance u r responsible for it you will be in trouble if you do not comply all things
From India, Ahmadabad
Dear Archana,
Greetings for the day,
First of all tell me that your establishment is covered under ESIC/EPF or not. If covered than your contractor is covered under the ESIC/EPF or not. If not tell your contractor to get coverage under the same as because both the concern are provide social security to the employees of unorganised sector. If the contractor is providing the labour to you ask him to pay the esi/epf contribution in favour of labourers immediatly if he unable to do so the liablity must fall to the principle employer for whom the job work is being carried out.
thanks & regard,
sumit kumar saxena,
9899669071, 0120-4131277
From India, Ghaziabad
Dear ARCHANA, for contract employee you Should have to pay ESI & PF As per the contarct labour act 1970. Regards Charvaka Reddy
From India, Hyderabad
Dear Archana,
Above all Respondents have given a right statements against your words. Yes, it is your responsibilty if Contractor does'nt fulfill Pf related matters (Deductions & all). Firstly tell who is paying to Contractor's Employees?
Abhishek Garg
From India, Delhi
Most of the comments and suggestions given are right. As the principal employer, your company is fully liable. My suggestions are:
1. Ensure that the contract has a PF code and an ESI code. This must be done at the time of enlisting the contractor or changing a contractor or if your present contractor does not have the codes, insist that he get it immediately.
2. Before paying the bills for the month to the contractor, insist on production of original / copy of challans of remiittance of PF / ESI contributions. Without this you should never pay the contractor.
3. You are supposed to witness the payment of wages to the Contract Labour and you must check the wages register whether the components of EPF/ ESI contributions / recoveries are mentioned against each name of the Contract Labour.
4. In a classic and landmark judgement the Supreme court has dealt with the Subject of ESI in great detail. The contracts or job works done through contractors fall into different categories: (A) those who work inside your establishment having their own ESI code (B) Those who work inside your establishment but not having their own code (C) Those who work outside your establishment and having their own ESI Code (outsourced jobs done outside) (D) Those who work outside your establishment but there job work is fully supervised by the Principal employer; (E) Those contractors who work exclusively for you and none else; (F) Those contractors who work outside but without supervision by the Principal Employer (G) Those contractors who by themselves Government Agencies or contractors who have their establishment in non-notified areas/ Zones.
5. If the contractor has his own code under ESI, the principal employer is NOT LIABLE AT ALL UNDER ANY CIRCUMSTANCES.
From India, Madras
Dear Archana,
yes its becomes the responsibility of principal employer if contractor is not able to deposite pf/esi contribution.and deduct such amount from the contactor bills.if u have any other quiery just let me know.
From India, New Delhi

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