Navigating Contract Labour Laws: How to Handle PF Registration When Contractors Have Fewer Than 20 Workers?

The application of the Contract Labour (R and A) Act, 1970 applies to every establishment in which twenty or more workmen are employed or were employed on any day of the preceding twelve months as contract labour.

The situation:
The Establishment has outsourced some of the work on job contract, and the total number of workers engaged by its job contractors is more than 20. The organization has, therefore, registered with the Regional Labour Commissioner as the Principal Employer.

Each of the job contractors, however, is engaging fewer than 20 persons. Therefore, the Regional Provident Fund Commissioner's Office is not registering these Job Contractors for depositing the PF contribution of their workers.

As per the EPF & misc prov. Act 1952, the coverage is extended to every establishment employing twenty or more persons. There is a dichotomy in the situation. How do we go about it? What are the implications?

Dear,

In this situation, you deduct the PF of contract workers and deposit it under your code.

Thanks,
J. S. Malik

Dear,

Every month after salary day, contractors are required to submit their bills to you. In this case, you should carefully review the PF deduction section. Once the bill checking process is completed on your end, please make a note in the Account section of the bill sheet to only prepare a check for Labour charges, service charges, and service tax. Do not include the PF amount in this calculation; that amount will be retained by the company. You can deposit it into your company account and then transfer it to the PF office.

Thank you,
Rajesab

Dear Sanyalanjan,

If the PF account is not there for your contractor, you may collect all the employee details from the contractor, and with consultation from the PF Office, you may apply for contractor registration on behalf of your PF registration. Then, deduct the PF of your contractor and deposit it to the PF Office, and the same you may debit to the concerned contractor.

Please let me know if you need any further assistance.

Thank you.

Hi Sanyalanjan,

Where are you located? As per my knowledge, there is a new amendment regarding the act where PF will be applicable for establishments where more than 10 employees are working. Please find out.

Thank you,
Raj

Dear all,

In my company, I have registered with contract labor, but due to the non-availability of more orders, I have not taken the contract workers. Do I have to cancel my registration? Do I have to inform the labor office? What is the procedure?

Please reply.

Raj

Dear Friends,

I have already posted an article on the "KNOW ABOUT CONTRACT LABOUR (R&A) ACT." Please go through it or refer to the attachment.

Regards,
PBS KUMAR

Thanks very useful for your attachment. I am working in a construction company where 600 laborers are employed under the Contract Labour Act. They are not maintaining any PF & ESI for the aforementioned laborers; instead, they have taken an insurance policy under the Workmen's Compensation Act.

Is this insurance policy sufficient? Please guide me.

Thank You

Hi All,

The EPFO has issued a notification to the principal employers to deduct PF on the labor charges paid to the contractors. I hope this notification was issued sometime in 2005. If someone has the notification, please pass it to the group. I will also try to obtain this notification.

Dear,

Registration under the Contract Labour Regulation & Abolition Act is totally different from registration under the PF Act. For registration under the Contract Labour Act, the employer sends the information about the name, address, nature of the job, and the average number per day to be employed by each contractor. If the contractor is employing more than 20 workmen on any day, then he has to get himself registered under the above Act.

Regarding PF, when you go through the registration form, there is one column for Voluntary. Under this column, the PF Authority is bound to register even if you are employing fewer than 20 persons. The only formality required is that the employer and the employees have to give an undertaking about voluntary coverage.

Ak Malhotra

Dear Sir/Madam,

I am looking to register myself as a Government-approved contractor for official works, cleaning, and supplying office stationery. However, I am unsure of the procedure and eligibility requirements for registration.

Please help me.

Inderjeet
Email: indersarojs@gmail.com

Hello Sir, please guide me. Should I obtain a fresh Registration Certificate from the Labour Commissioner in case of any change of contractors (providing more than 20 laborers)? What is the procedure, please?

Thanks & regards,
R. Narwal