Are Voucher Payment Employees Cover Under PF & ESI Act? - CiteHR
Madhu.T.K
Industrial Relations And Labour Laws
AK CHANDOK
Epf & Esi Matters
Subbarao.v
Esi & Pf Consultant
Siba Mishra
Indian Oiltanking Limited
LAWANDE RAMESH
Hr Manager
Korgaonkar K A
Ba,llb,mpm,dir&pm,dll&lw,d.cyber
Kknair
Hr, Ir, Law, Disc. Matters
+6 Others

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Respected Expert, Please advice..... shall we consider voucher payment employees under PF & ESC Act? Regards, Anant
there is no category called "voucher payment employees". plz explain what you mean by voucher payment employees ?
yes every is covered in ESI No one is exmpted and there is no cat as vr emp
Dear Kamal, Those employees getting salary in cash and not maintained proper record like personal file and attendance recored with regular employees..... Thanks & Regards, Ananta Karad
Dear anant.karad,
What you are doing amounts to unfair labor practice. It is against all labor laws. If you are not maintaining any records then how you pay them? You will be in big trouble one day.
If you are hiring casual labors and paying then in cash then all statutory benefits are applicable.

Dear Anant, Although there is no exemption provided expressly under the Act, but there are case laws holding that casual employees appointed to deal an exceptional circumstance (like for redemption after a fire incident or for annual painting/colour washing etc), PF & ESI are not attracted. There are two ways you may get caught, one is if the inspector visits your factory and seeks compliance in respect of such casual workman or if the voucher payment expenses are booked in wage and salary account head, the Inspectors when they inspect your account can ask for compliance with respect to them.KK
Whatever mode you make the payment definitely such payment attracts PF and ESI if it is within the wage ceiling of pf and esi
In my opinion, if a person is engaged for some temporary exigencies and is not engaged for a long ,but paid through voucher, no PF deduction is required as has been held in few cases but if engaged for a continuous period,Payments made through vouchers are liable for PF deductions.
AK Chandok
RPFC (Retd.)
<link no longer exists - removed>

Dear Anant
In simple word ,if you are giving any amount through voucher to employees,& showing it as salary & wages ,then its comes under cover .( Remember :if you are not showing ,its illegal) Ex: Person X is getting Total 10000 on record & suppose 5000 by voucher payment. 1) PF & ESIC will be only for 10000 ( If no voucher payment is booked or shown in record ) & 2) if you are showing voucher payment as salary ( by any mean we can give salary to our employees, by cash, chq or salary transfer etc.) then pf & esic cover will be applicable for 10000+5000 = 15000/=.I think it will clear your views.
Anjani Singh

Friend

All employees are to be covered under all labour laws, irrespective of how you pay and how you try to hide such payment. In fact there is no category called "Voucher Paid employee". What you mean by voucher payment appears to those who are not brought in wage register or muster roll. Not covering them under ESI/EPF etc is violation of law and also criminal offense but also violation of Payment of wages act, fact act/rules and various other laws. It is true that often you may have to engage a person for a day or two or even few hours, and you may not include them in the Permanent employees register, but you need to have separate register for "Temporary/Casual and Badli workers", indicating their wages, period of work etc and need to comply under ESI/EPF.

I do not agree with kknair that there are Court judgment saying that such employees need not be covered. Majority of judgement of Supreme Court and High courts emphatically stated that all workers, whether employed as casual, temporary or through contract need to be covered under ESI and EPF. In fact he may be referring to a particular case where court talked about "birds of passage", which is not the law laid down. Please remember that accidents (which may result in death or permanent disability) is not based on seniority or manner of payment of wage and can happen to any one at any time and you cant just throw out the body of a victim outside the gate. In fact more accident happens to untrained, insecure casual workers.

O Abdul Hameed

Formerly Addl.Commissioner ESIC



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