I have a query. There is a contractor X (sole proprietor of his firm) who supply manpower to principle employer. Apart from this he does not have any other business. He has hired two person A & B for his office work and pay their salary from his pocket.
1. Can he pay these employee's EPF and ESI and what other compliances need to be fulfilled?
2. If yes, then during inspection how their contribution will be justified as these employee were not deployed at any principle employer site.
3. Does he has to maintain their muster roll, wage register, leave register and all other compliance required?
4. Can he continue paying their EPF & ESI if he stop supplying manpower and does not have any active contract labor license?
Need your expert opinion on the above matter.
From India, Delhi
In his business operations, every contractor has a dual role - one being a contractor under the contract for service with another through his contract labor and two being the employer for his entire employees under a contract of service with him though some of their services are lent out as contract labor and some others who are looking after the works of the contractor's establishment.
Practically, a contractor may mobilize the workforce required for a particular contract work depending on its nature, location and duration. It is immaterial that such contract labor are discharged on the completion/expiry of that particular contract or retained in some other work in any other location. Leaving aside the vicarious liability created u/s 21 of the CLRA Act,1970, the contract of employment between the contractor and his contract labor subsists till their final discharge. That's why the definitions of the term "EMPLOYER" under sections 2(l) of the Code on Wages.2019, 2(m)(iii) of the Industrial Relations Code,2020, 2(u) of the Code on OSH& Working Conditions,2020 and u/s 2(27) of the Code on Social Security,2020 respectively cover uniformly in their fold the contractor also.
Therefore, in my opinion, as an employer, the contractor who hires the services of any person exclusively for his office works which invariably relates to his contract works has to comply with all the labor laws including EPF and ESI as they are applicable to the contract labor.
From India, Salem