2. If principal employer and his contractor want to cover their workers under ESI Act or under EPF, then , in my opinion, it is a good step.
This is a common technique adopted by some of the Principal Employer. They adjust on days present to bring down net payable amount to Workmen to save on PF, ESI etc.. In the given case it seems wage is fixed to match Minimum Wages (in Books) but attendance is adjusted to bring down Net Payable to Workmen to Rs.3500/- PM. It apparently looks "ok" till discovered by "Appropriate Authority". The punishment in such cases is severe as the Authority first "SEAL" all Bank Accounts of the Principal Employer and thereafter calculate amount (for full attendance) payable with imposition of Fines and Damages
It is better to avoid such situation. You may kindly refer the PF case of M/s B.L. Kashyap & Sons (BLKS) Ltd. (CBI in its) and consult your employer.
It is similar to a situation, employer is knowingly committing a crime with full knowledge of punishment. Moreover, penalty , labour problems etc are bound to come , making things unmanageable . If you are HR or advisor to employer, are you not party honestly in creation of black money. See, one willful mistake will lead and link many others in the circumstances,do not dream that it shall always remain uncovered. If group of employees together stand up with this problem and they all say that instead of 30 or 26 days working days, employer in conspiracy with HR fabricating in documents showing only 15-18 days, then you can not stop them . Workers will be giving full evidence of attendance, production records ,produced , recorded by them , generated by management . Its past time which has passed so far and feel happy. Today, be ready to upload all attendance and bank statements of payments given wrt all employees. Please share these to your employers boldly and suggest a legal , a real futuristic plan that can erase out bad name if any from the minds of employees also, as your employees shall always be well wishers of company .Regards,