Respected seniors
This is Ramu working as DM-HR in a manufacturing unit. Our management has given plant expansion project contract to M/s.L&T Co. Accordingly L&T has obtained labour license as per the provisions of Contract Labour Act. Now L&T is offering sub contracts to others. Some of the sub contractors are having PF & ESI establishment codes and they are remitting contributions on their (sub contractors) codes. L&T is paying PF & ESI contributions to some of the sub contract workmen those who didn't have individual PF & ESI codes
Sub contractors doesn't have labour licenses and we have not issued Form-V also
My queries are
1. Sub contract is permissible or not
2. Whether Sub contractor has to get labour license and whether Principle employer has to issue Form-V?
3. License is main contractor and PF & ESI contribution in Sub contractor code is valid or not
4. Statutory records who has to maintain, Main contractor or Sub contractor (Form-A, B, C, & D)
5.Can Main contractor issue Form-V to sub contractor?
6. Can we allow if there was a valid agreement between Main contractor and Sub Contractor
Kindly give your valuable suggestions on this issue
With regards

From India, Vijayawada
Sub Contracting is regular affair for any project. You need to ensure enforcement of all labour rules through your contractor L&T and as the licence is issued to L&T, they are liable for all matters related to engagement of employees under sub contractors. As Principal employer, it is your responsibility for ESI and PF coverage and payment of contributions in respect of all employees engaged in your premises. This you have to ensure through your contractor L&T. You may regulate entry of all employees to the Company premises through appropriate passes on recommendation of your contractor L&T. On regular basis and while settlement of bills of the contractor you may ensure as principal employer that ESI and PF contributions and all statutory requirements for engagement of employees are met by your contractor L&T for which it is left to the contractor L&T to have similar arrangements with the sub contractors.

From India, Bangalore
Thanks for your advise sir But license is having main contractor and PF & ESI contributions remitting in sub contractor code is acceptable or not under labour laws Ramu
From India, Vijayawada
Yes, this is acceptable, since they have agreement in place btw them. only the contractor L&T has to certified on the compliance part, before they submit to PE for settling bills.
From India, Mumbai
Thank you sir for your valuable advise
From India, Vijayawada
Dear friends,
Can you please advice on how exactly does the Principal Employer remit
(a) PF contributions for employees of the Immediate Employer (IE) under the IE code? Is there a IE mapping facility available in the PF portal (i haven't seen one). How exactly does the PE remit PF contributions under IE code (the exact procedure)?
(b) ESI contributions for employees of the Immediate Employer under the IE code? I have seen the feature in ESIC Portal for adding IEs under the PE and also mapping IE employees. Does this feature work smoothly? Though I have seen this feature, I have not yet used it, hence the doubts!
I want to start paying PF & ESI contributions for the employees of IE working with us so that the statutory aspects of being PE are met by my organisation.
Advice would be most appreciated.

From India, Kochi
Dear Ramu HR, The vital question here is whether the Contract awarded by your Company to L & T Permits Sub Contracting? Has the Contractor (L & T) Intimated your Company in writing about Sub Contracting? Please verify the relevant records
From India, New Delhi
Dear sir
There was agreement between L&T and their sub contractors. But we have not mentioned any conditions in the work order about the sub contracting. L& T is the auhtosied licensed contractor. PF & ESI contributions are being remitted through Sub contract codes also for some portion.

From India, Vijayawada

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