Dear members,
This is really an intersting matter to discuss.
First of all I would like to update now the whole employer PF contribution (12%) is applicable for PMRPY scheme wef 01.04.2018. Rightly said by learned members the immediate employer can avail the benefits.
Now the main point is whether the PE can force / request the contractor to pass on the benefits. Though everyone will favour to their part. Contractor will never like to pass on the benefits whereas the PE would like to get the benefits (through the contractor’s invoices) for cost optimization. From my point of view there could be two scenario :-
1 Whether the PE has awarded lump sum contract? Which includes recruiting and managing the manpower, compliance of all statutory benefits (irrespective of revision in MW Act, Amendments in PF-ESI contribution, Amendment in Bonus-Gratuity-MB Act etc.). In such contract as per my opinion the PE is not supposed to request/force the contractor to pass on the PMRPY benefits. Because the contractor has been bearing all statutory compliance related expense from his pocket only and in case of increasing the cost (due to amendment in various acts) not claiming the cost impact from the PE.
2 In case where the contractor is providing service on “Service Charge” basis (which is now a days regular practice from many PEs). There are many big corporates / contractor who are providing “Third Party Services” to various organisation on basis of actual month CTC (which arrives on basis of defined wages and acutal attendance). On the monthly calculated CTC they claim some service charge (5% - 10% as per the negotiations). All other cost (Bonus, gratuity, MB, MW Act revision) are also charged as per Amendments in the Acts.
In such case the PE can request the contractor to pass on the benefits. Bcoz PE has been bearing all cost impact directly (due to change in law). Hence if any benefit is being given by the govt. to the “Third Party”, same should be pass on to the PE. The contractor should also pass on the benefits to the PE.
I am handling more than 50 contractors (who deploy huge manpower in our projects all over India). In case where the benefitted is amount is high, I requested the contractors to pass on the benefits. Some of them have been agree and we are in discussion with the rest as well.
Hope the senior member will agree with my justification, if required I would like to throw more light on the matter.