Anonymous
Can Employer Have Common Statutory Compliance In The Manufacturing Unit For Two Different Entities
A & B, are two separate companies from one group working in one factory, A registered under the Factories Act, and common compliances are followed for both the organizations (A&B). Whether separate compliance required to be maintained for both the companies?

From Germany, Hallbergmoos
PROFESSIONALS AND BUSINESSES PARTICIPATING IN DISCUSSION
Madhu.T.K
Industrial Relations And Labour Laws
Saswatabanerjee
Partner - Risk Management
Nanu1953
Ceo-usd Hr Solutions
Hemant6781
Corporate Human Resoucr

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saswatabanerjee
2284

You need to share more details if you need a proper answer. What you have posted is a little vague.
From India, Mumbai
Hemant6781
I try to make it simple -
One group have one factory at Maharashtra.
Company A & B belongs to the same group, Co A have 25 % of the manpower & Co B have rest of 75% manpower running this factory.
Company A is registered under the Factories Act,
There is common statutory compliance being followed for Co A & B.

Question - Since A & B belongs to one parent group, for compliance purpose, can all employees (from A & B ) will be treated as one company under Factory Act? or separate compliance / documentation is required for A & B? How to go about it?

Hope, my doubt is clear now.

From Germany, Hallbergmoos
saswatabanerjee
2284

Like I said, you need to give all the details if you want the correct advice
Claiming to make it simple and in the process hiding some information does not work.

Anyway, the compliances can only be done for the employees of the company where they are employed. So company A can not do compliances including employees from Company B, unless Company B is a contractor under Contract Labour Regulations.

But the answer again, depends on a number of circumstances, which you are reluctant to disclose on the forum. Then I would suggest you take the help of a labour consultant or a lawyer who is an expert on the matter.

From India, Mumbai
Madhu.T.K
3726

For all purposes under labour laws, the employees will be clubbed together even if the entities have different registrations provided the management is same and when there exists financial integrality, ie, transfer of fund from one establishment to another.
From India, Kannur
nanu1953
256

Usually in this type of situation, there may be two options.

OPTION - 1 - Both the A and B are located in one place. One of them started earlier and subsequently the second one developed as a part of extension of existing factory. Then the extended site plan should be approved by the factory directorate. Other formalities - Trade License, Pollution etc. to be taken care and compliance under labour laws will be common.

OPTION -2 Both A & B may be in same location or at different locations under the same management. There is possible to get different Factory license, Trade License etc. and compliance under labor laws will also be different. Usually if the factories are at different locations, it will be better to have two set of compliance.

JSW Bengal Steel started the factory at Salboni, WB. But it has not been finally finished. It has all approval and compliance under JSW Bengal Steel. Subsequently, the same management started JSW Cement Plant at the same premises with absolutely different entity - Factory license, PF, ESI etc. compliance differently - there is no issue.

USD HR Solutions has one client who are in the business of Pathology, imaging etc. under one roof and one management with 4 different organizations - registration under S & E Act differently, different labour laws compliance - even under two entities number of employees is less than 10 and no ESIC compliance. All organization has PF registration ( voluntarily and normal ) .

It depends on management strategy how to run the organizations with proper compliance.

From India, New Delhi

If you are knowledgeable about any fact, resource or experience related to this topic - please add your views.







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