Pf Compliance - CiteHR
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Dear Koshsish

The principle employer will be held liable for the negligent act or omission by the sub contractor.

The first and foremost thing that you need to do is send a registered letter to the contract asking why a legal action should not be instigated against him by your company for his repeated failure of filing pf with the pf authority and thus failure to comply with a statutory requirement.

Ask your contractor to reply within 3 working days to your registered mail. Inform him that if he fails to reply back within three working days the company would be forced to charge criminal complain for pf fraud and also labour complain for wrongful labour practice and non compliance to labour laws of the land.

If the contractor doesn't comply with you after sending above letter then, kindly terminate his contract with immediate effect.

After the contract has been terminated, please inform the local pf authority about the same.

The above procedure will help you and your company avoid getting in to unnecessary legal issues.

After the above acts have been performed kindly send a notice to the contractor, seeking the amount of PF that he had shown as been deducted,so as to be refunded to the company back,the intention to seek the money back should be to refund it to the employee to whom it rightfully belows.

Also inform him again that failing to return the amount would cause an action for civil complain and criminal proceeding against the contractor and his company will be instigated for fraud and cheating.

The above procedure is also important because, it can be used to show that the company has exercised Due Diligence and was not party to the non compliance and fraud act of the contract directly or indirectly or knowingly. And also it goes to show that the company had taken extensive care in securing third party contract labour's rights


Dear Satishji,
I have gone through the reply. But you are not considering future problems that may arise and leads to complication. It is alright to follow the judgement but this will leads to another complications that will have bigger effect on the organization. I hope that you understand it.
Avinash K.

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