ESI And PF Registration For Sub Contractors ??? - CiteHR
Harsh Kumar Mehta
Consultant In Labour Laws/hr
Srinath Sai Ram
Hr Manager
+1 Other

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Dear All,
I am Vinod , working as a HR, and, my question is, we are the contractor, got labour licence for 400 workers and as of now we engaged 4 subcontractors each sub contractor engaged 7 workers, so total number of workers come around 24, so who is liable to pay the ESI and PF of the workers ? either the subcontactors or we the contractor,
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1. Sir, obtaining of labour licences etc. under CLRA has no relevance with compliance under ESI and EPF laws. These laws are self-contained/complete codes and its provisions are required to be complied with. You have mentioned that your establishment is a contractor firm, and hence in addition to your establishment, the principal employer with whom your establishment is working is also liable for compliance under above Acts in respect of employees engaged through all contractors or sub-contractors.

2. Though, a principal employer can recover contribution of employees of contractors or sub-contractors etc. from their bills etc., but still the principal employer is liable for all type of compliance under above Acts -viz. payment of contributions, registration of employees, submission of all type of returns, maintenance of records as required under said Acts etc. etc.

3. It will be more better if the principal employer may retain copies of complete documents of contractors, sub-contractors viz. challans, returns, registers of payments of wages and contributions etc. in respect of contractor, sub-contractor employees so that as and when there is any verification of records/inspections under above Act, the principal employer or his HR may be in a position to show the compliance to the satisfaction of said authorities.
Please clarify what Labour License you have already obtained, is it under C L A or any other Act?
In respect of Employees whom you have engaged for execution of work & for whom you are paying salary/ raising bill against Principal Employer for such Employees it is your responsibility to make payment of ESI & PF
The manpower of each subcontractor will not enable them to apply for registration under PF or ESI act. Therefore you have to comply with these acts.
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