AK CHANDOK
Epf & Esi Matters
Sree
Business Analyst
Anil Ks
Business/ Director At Shree Group
+6 Others

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Dear Seniors,
I am working as HR with a small pvt ltd company which is into fish business. This company has employees 17 employees on its payroll and nearly 35 employees on third party payroll. The contractor also does not deduct the PF from these employees salary and pay them in cash.
Total No of employees are 52 + 2 directors.According to PF Act the company is liable to pay PF if it employs 20 or more employees.
Please help me in this case should we register for PF?
Please guide.
Regards
Chaitrali

As per P F act, 20 or more employed on preceeding year so pf is not applicable and P F is applicable to the contractor who is employing on his muster roll 20 or more employees. Here contractor must pay pf of his employees and can add in his bill to deployed company means your company.
Hi Chaitrali,
Let me add on to what CDB has mentioned.
The contractor, as he has on his rolls more than 20 employees is liable to pay PF for them. However, it is the primary responsibility of the principal employer (YOU in this case) to make sure such payment is being done. If the contractor does not pay, then it becomes your duty to pay their PF on the contractor's behalf.
You need to have copies of Form 3A and challans of payment as proof, in case of an audit or inspection.
----
sree

Thank you Sree
I have query here should we register for PF now as we already have onrolls 17 employees and 2 directors who are drawing remuneration.
We asked the contractor if they are deducting the PF of these 35 employees so their reply was "these 35 employees are falling in workers category so no need to deduct the PF"

You have to regsiter sinc ethe toal number of employees including contarcotr’s employees exceed 20 employees. B.Saikumar Hr & labour Law advisor Mumbai
First of all, i want to clear that limit of 20 employees has been reduced to 10 employees.
and contractor, as he has on his rolls more than 10 employees is liable to pay PF for them too.
and as CBD mention about you being principal employer to to make sure such payment is being done, otherwise you have to pay all dues of pf of your contracted employees.

Dear,
These labours are coming under provisions of Contract Labour Act (R&A)1970.
For such employees the Contractor has to be registered in Labour department for maximum number of workers working in the said unit. The Company also shall be registered for all such (if more than one)in Labour dept.
The Contractor\'s labour\'s wages shall be broken down in basic & other allowances so that PF shall be paid at 12% of basic by employer & equal deduction shall be on the part of employee.The payment SHALL NOT BE MADE under Company PF number, but the Contractor must get PF number (if not existing) & make remittances accordingly.
Normally contract employees are reluctant to deduct any amount even if it is for long term investment but if compliance is to be made this is unavoidable. Such practice can be done when any revision is made in wages. The present gross wage only has to be broken down as above.
A record for payment made shall have to be maintained as laid down in rules above.
A con

Mr.Nitesh
can you please provide a copy of the notification by which the number of employees has been reduced from 20 to 10 for the purpose of coverage under P.F Act for the benfit of members.
B.Saikumar
HR & Labour law Advisor
Mumbai

Dear Sir,
Ours is a public ltd company having offices all over India and also we have separate PF. We are having a guest house in kerala having 4 contract labours. As the contractor is not having any registration, we would like to have PF sub code. Can any one suggest the procedure for getting PF sub code.

Mr.Nitesh
can you please provide a copy of the notification by which the number of employees has been reduced from 20 to 10 for the purpose of coverage under P.F Act for the benfit of members.
I also wants to know the circular for the same.


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