Madhu.T.K
Industrial Relations And Labour Laws
Gopinath Varahamurthi
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R.SOMASUNDARAM
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Ambicapolymer
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Is it necessary to register the Charitable Trusts such as spiritual institutions under the labour act, pf act and esi act?
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Dear R. Somasundaram ji,

Common law is, once you employ any person relationship of employer and employee establish there. Once employee employer relationship is established, labour laws are applicable. However, there are exemptions in certain employments.

Under ID Act 1948, charitable, social or philanthropic services is not an industry . So ID Act is not applicable to you.

Minimum Wage Act 1948 is applicable if the activity carried out by trust is in schedule employment under MW Act and if it is also establish that the activity is a systematic one, run by the co-operation between the employer and the employee and there is a production and/or distribution of goods and services. Since you are in spiritual, MW Act is not applicable to you, according to me.

Shops and Establishment Act is applicable to Charitable Trust. Charitable Trust is a 'Commercial Establishment' as defined under this Act in almost all the States, which I know.

EPF & MP Act 1952 is applicable to Charitable Trust / Institution. Trust / Institution is charitable is not relevant to determine whether the Act is applicable or not. What is important is, if it is factory it should be in schedule I of the Act and if it is establishment it should be specified by Central Government vide notification in Official Gazette. Your are in spiritual activity, provisions of EPF & MP Act 1952 are not applicable to you.

ESI Act is applicable to charitable trust or not, there is an ambiguity in my mind. Private Educational Institutions(those run by individuals, trustees, societies or other organizations) and Medical Institutions (including Corporate, Joint Sector, trust, charitable, and private ownership hospitals, nursing homes, diagnostic centers, pathological labs) are brought under ESI by a separate notification. But charitable trust other than in Educational or Medical, there is no mention.

Gratuity Act 1972 is not applicable to public and charitable trust as per S.V.S. Agarwala v K.L.. Agarwala 1996 Lab IC 797 (Cal).

Experts are requested to comment on this subject so that there will be more clarity in it.
Dear Sir, Is Exgratia payments for Temple volunteers duductable under P.F & E.S.I Act.? Please, calrify.
In my opinion it is not the constitution of the establishment but the existence of servant and master relationship that will decide the applicability of labour laws. There are a lot of charitable trusts under which some kinds of manufacturing or trading activities are being carried out. Even running of an educational institution under a charitable trust is very common. In such kinds of establishments there exists master servant relationship and, therefore, all Acts are applicable to them as if they are constituted with profit motive. If these institutions are to be exempted from labour Acts, I think 95% of small companies will be registered under any Charitable Trust and would have availed the benefit of exemption from coverage of ESI, EPF, Gratuity, Bonus or payment of minimum wages. Therefore, if any charitable institution employs a worker the same will come under the purview of labour laws.
Madhu.T.K
Dear All
Charitable trusts are "industry" as defined under the Industrial Disputes Act 1947 and as interpreted by the Honourable Supreme Court in Bangalore Water Supply and Sewerage Board vs Rajappa
With regards
V.HARIKRISHNAN
Dear All,
Notification F.No. S.35014/1/2010-SSII dated 14th May, 2010 under Secretary to be the Government of India, Ministry of Labour & Employment was issued granting exemption to religious/charitable trusts etc. from the operation of the EPF Act for a period up to 31st March, 2015. I need to know if any extention is given to this Notification?
If Yes, then please provide me. It would be a great help from yourside.
Thanks
With regards
Shweta
Dear Saswata ji,
Please find the said notification attached herewith.
Dear Shweta ji,
I am also looking for whether GOI has extended this date or not.
Most of the officers from department are unaware of this exemption.

Attached Files
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File Type: pdf PF EXEMPTION TO TRUST.pdf (143.4 KB, 1027 views)

Thanks for sharing the notification. It is well written that the exemption is available to such charitable institutions which do not generate any income either by way of any business activity or collection of fees or other charges. In the provisio please find that if a charitable institution runs any school or college or hospital and collects fees from the students or patients, the exemption will not be available to it. That means it should be a charitable organisation by all means without having any business interests. It will be okay for temples, churches, maths or places of public worships but other charitable institutions either have schools or hospitals run by them and such institutions will not be ‘charitable’ for the purpose of PF exemption.
Madhu.T.K
Dear Friends,

Herein the questions is whether to register the Charitable Trusts such as spiritual institutions under the labour act, pf act and esi act?

No, spiritual institution and charitable trust are separate issues, Charitable Trust can run a spiritual institution, and the workers/employees are to be accommodated under respective laws, the members are not eligible for pay and allowances however, they are entitled for remuneration for sittings and for the function of the trust for noble cause...

The employees are very much entitled for PF, ESI, Gratuity and all other benefits in accordance to the rules and the functions of the organisations they serve... The question here in comes, whether a pandit/poojari is entitled for benefits for his/her services for the temple, for the poojas performed to the deities? Such questions raise a lot of dubious and distinctive perceptions, yet, the poojari is performing some services/employed to do the cleaning of the deity, decorating the deity, putting his/her services thus, the trust should pay the poojari and there is no violation saying as spiritual focus, the temple should be brought in as public service under endownment system, the spirituality should not be violated as service, in that case where did the poojari go for his stomach and life? what happen to his dependent family members? If we assume spiritual institutions then too some organising factors involved as research issues, thus trust and institutions are separate issues we should not club all in one place..Here is attached trust/society acts, and some papers for further needful to the members to consider :

Best of luck .....

Attached Files
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File Type: pdf Guidelines for Forming Trusts or Societies_english.pdf (41.5 KB, 349 views)
File Type: doc Deed of Trust.doc (61.5 KB, 348 views)

If there is any systematic activity carried on with the cooperation between employer and employee, it will be an industry, eg. the laddu makers in TTD are workmen under IDA therefore IDA is appl there. Therefore all provisions regarding retrenchment, lay off, strike lock out as also, termination, will be applicable to the Trust also.
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