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krishna-hrm
ESI can be avoided if an amount paid to workers is paid underanyheading?
From India, Coimbatore
Madhu.T.K
4210

Can I understand your question like this?

" Can an establishment avoid ESI if amounts paid to employees are accounted under a head other than Wages/ Salaries?"

If your answer is YES, my answer would be NO !

Reasons:

1. You cannot run an establishment without employing people.
2. You cannot keep the attendance register with only 9 persons as your employees and hide the others when a Social Security Officer of ESI comes for inspection.
3. There cannot be an arrangement with the employees that they work for charity and they will not take any remuneration for their labour. Whatever be the nomenclature, the payment made to workers/ employees will only be considered as wages/ salaries.

Why should you avoid ESI?

What is the benefit to the organisation if you avoid ESI? Can you escape from the compensation payable to a worker met with an accident while on duty following the Workmen Compensation Act? Do you know how much it would cost you if the worker dies or becomes permanently disabled following the accident?

Now think about the above and decide if you should avoid ESI or not. It is true that no employer is liable to provide medical facilities to his employees and their family members. But how do they feel if they get it?

From India, Kannur
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