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Criteria for coverage under ESI an establishment having Regd. Office in Maharashtra, who is a "Contractor", takes job on contract and complete the job on site of his clients only.
1. Number of Employee 20 overall (i.e. including employees drawing wages over 21000/-)
or
2. Number of Employees 20 drawing wages below threshold wage limit (Rs.21000)
out of the above two which criteria will be applicable for this establishment for deciding coverage/Date of Coverage under ESIC.

If the establishment is covered by ESI by virtue of having 10 workers, then the same shall be extended to the workers of the Contractor also. If the contractor has no separate registration, it is the principal employer's duty to cover the workers of the contractor under the principal employer's registration and pay the contributions in respect of these workers along with his workers. Obviously, he can deduct the amount so paid from the amount payable to the contractor.
In practice contract is now awarded only to such contractors who has separate ESi and EFP registrations. This is because the principal employer do not want that the workers of the contractor be given registration similar to their on roll workers for the reason that n future the contract workers will demand regularisation saying that they were enrolled under the ESI/PF of the Principal employer. Though this will not make them succeed in their efforts to get regularisation, nobody would be interested to go for disputes etc on account this practice.
Contractor as an employer shall take separate ESI registration if he employs 10 or more employees. For coverage the total number of employees is considered and as such even if you have 10 employees and all the ten employees are paid more than Rs 21000, your establishment will be covered.

Contractor company/Establishment wants to take its independent coverage.
The Establishment is in Maharashtra.
For coverage of commercial establishment in Maharashtra and Chandigarh, threshold limit of employees is 20, different than other states.

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