Harsh Kumar Mehta
Consultant In Labour Laws/hr
Senior Officer - Hr
A contract labour cannot claim permanency just because the EPF amount is deducted by the principal employer. There are several case laws supporting that. So, its principal employer's liability to deduct the EPF for contract labors too.
10th December 2015 From India, Chennai
#AnonymousIn this case, the restaurant make a monthly payment to the contractor. The contractor makes the payment to his 7 employees. The restaurant only pays the salary of its 15 employees. So will the employee strength be counted as 22(Permanent + 7 of contractor) or 15? If the strength is counted as 15 then the restaurant will not be under the pf and esi coverage?
thanks in advance for the help.
10th December 2015 From India, Patnagarh
2. Restaurants/hotels using power for manufacturing process i.e. for preparation and preservation of food items are treated as "factories" as defined under ESI Act, 1948 and rules/regulations framed thereunder and hence coverable if employed 10 or more persons.
10th December 2015 From India, Noida
As per applicable provisions, your restaurant is liable to get registered under ESI/PF as no. of total employees is more than 20 including contractor employees. However responsibility to pay ESI/PF for contractor employees lies with contractor. In case he does not pay, then it will fall upon you being principal employer. However, you can recover this from payment made to the contractor.
In case of any other doubt, you can call me at 9999236926
Ashok Kumar Sharma
11th December 2015 From India, New Delhi
Now the contractors are usually raised question (even confused by many PE) that they have only 7 employees - therefore they are not covered under PF & ESI. This is not accepted by law as the PE is covered under both PF & ESI ( At PE's premises total no. employees engagement is 22).
In this type of case it is always better to engage contractors who have already covered under both PF & ESI and to engage all contractual employee through the said contractors only. PE will obtain their own PF & ESI code to fulfill their permanent employees compliance. This is probably the best solution to avoid any future complications.
S K Bandyopadhyay
USD HR Solutions
14th December 2015 From India, New Delhi