Bijay_majumdar
Freelancer In Hr &indirect Taxes For
Bharat Gera
Principal Hr Consultant
Gannahope
Deputy Commissioner Of Labour..a.p.
Srinath Sai Ram
Hr Manager
+1 Other

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Dear Seniors
We had engaged a contractor for construction work and accordingly entered in to agreement. But due to default on the contractor's side as per the terms and conditions of agreement the main contractor sublet the work to sub contractor with our permission.
Now as we have no direct connection with sub contractor and right now all the labour which is working is of sub contractor.
The problem is arising here that bills are being submitted by main contractor but all the statutory compliance i.e. EPF, Employees Compensation etc. are being complied by sub contractor.
My question here is that whether we can accept this or main contractor has to take all the workers working under sub contractor under his rolls.
please clarify
Regards
Ashwini

From India, Bangalore
Hi
This is the common problem in construction industry. Tentatively main contractor is responsible for all statutory Compliance. Since your agreement permits the subcontract, you can accept the records submitted by the subcontractors provided
1.thete should be an agreement between the main contractor and subcontractor
2.the agreement should clearly indicate the name and address of the principal employer and the address of the construction site.
If u are satisfied,then u can proceed with the bill processing.
Regards
Pranesh

From India, Bangalore
to whom you are making payment?Contractor or Sub Contractor? whether Agreement provides for Sub Contract? have you given permission to Sub Contract, ultimately, As principal Employer, you are liable for Compliance
From India, New Delhi
It is duty of the principal employer to ensure that the contractor complies with the labour laws, the responsibility lies with the principal employer and contractor also.
From India, Thane
You can accept the bills as the labour laws are complied with. Please check and ensure that the PF & ESI dues are regularly paid to the government.
From India, Thane
If Labour laws are complied properly then accept bills but ensure that you have all the documents are correct and preserved as proof of compliance Plus the copies of agreement from both the parties where it mentions the compliance clauses clearly.
From India, Vadodara
OH EXCELLENT QUERY..PRACTICAL ONGOING LIVE PROBLEM ISSUE IN PRACTICE EVERYWHERE...
OK SIR
LET'S COME TO PROBLEM SOLVATION..
Principal Employer made agreement with main contractor and he is implementing contract with his men as subcontractors.
What is in practice is sub contractor brings all necessary workers to complete the work. So the subcontractor knows all details of workers .So the sub contractor is like gumpu mastry and also the does the roll as Principal employer or manager of main contractor for the disbursement of each worker's salary and emoluments and deductions.
He is responsible for payment of salaries on behalf of main agreement named contractor. Now when come to legality the main contractor is responsible for receiving the total salaries cheques of workers from the principal Employer .He engages a sub contractor as his subordinate to disburse the salaries in the presence of an Authorized Representative from the Principal Employer side.All the Licenses and permissions like pf and Esi licenseswill run in the name of main contractor only.
So sub contractor's roll is acceptable.But subcontractor always only represents the main contractor. He should maintain and submit all necessary deductions and payments all legal bindovers in the name of main agreement contractor only.
The main agreement contractor usually declares so and so are his sub contractors for completing various works of contract.
So on record the sole responsibility lies on main contractor in attending and settlement of grievances of all workers engaged in the contract work. If the sub contractor fails to pay salaries to workers ...naturally the main contractor in agreement is liable to pay as first person. If that Agreement contractor fails to pay salaries to workers undoubtedly the Principal Employer is liable to pay all dues.pls Approach Contract labour Act norms pls.for further guidance easily understandable.

From India, Nellore
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