Navigating Labour Laws in Small Companies: How Do You Ensure Compliance?

Hi, I am working in a small organization that has only 11 employees. It is applicable for ESI, PF, Bonus, Factories Act, Shops and Establishments Act, and Minimum Wages Act. Please provide a proper answer to my question. It is a consulting services company registered under the Shops and Establishments Act.

For a company with a minimum of 20 employees, both PF and ESI are applicable. Additionally, for the PF facility, the company has to be at least 3 years old.

I thought that P.F. liability becomes applicable immediately when an establishment appoints 20 employees in any day. Does this apply after 3 months? Please clarify this for me. Thank you.

Hi Rao,

PF Applicability: Establishments having 20 or more employees.

ESI Applicability: Establishments having 20 or more employees drawing wages up to 10000.

MLWF Applicability: Establishments having 5 or more employees.

Bonus Applicability: Establishments having 20 or more employees.

For more clarification, kindly visit Excel Consultancy Services.

The PF will be applied as and when the establishment crosses an employment strength of 19 (becomes 20). The number is irrespective of salary. The only thing is that those who are drawing not less than Rs 6500 are covered mandatorily.

The PF will be covered from the date of joining an establishment covered by PF, and the infancy protection of 3 years has been removed.

For ESI applicability, the employee strength is 10 workers drawing a salary not more than Rs 10000. It is for other establishments like service sector companies that the minimum requirement is 20 employees.

Regards,
Madhu.T.K

Dear All,

I have joined a software development company as an Assistant Manager which started its operations in July 2007 (last year), and is a subsidiary of a US-based company. As of now, there is no HR Manager; there was an HR consultant who is not continuing with us. He mentioned that, being an IT company, various labor laws (Factories, Shops & Establishments, etc.) are not applicable to us. It should be noted that we have 20 staff members here, and 8 of them have a basic pay below Rs. 6500/- per month.

Could you please clarify which laws are applicable to us, how I should start implementing them, and where I can find the required forms? Kindly provide detailed information on this matter. Thank you all in advance for your valuable time and advice.

Regards,
V. Bhaskaran

Hi,

ESI Applicable: 10 or more persons with power, 20 or more persons without power.
PF Applicable: 10 or more persons with power, 20 or more persons without power.
BONUS Applicable: It is applicable in all establishments but the condition is that the employee should work a minimum of 30 days, and his salary must be between 3500/- to 10000/-.
Factory Act: 10 or more persons with power, 20 or more persons without power.
Shop & Establishment Act: I don't know about it.
Minimum Wages Act: Refer to State Rules.

ESI Applicable: 10 or more persons whose gross is less than ₹10,000/-

PF Applicable: 10 or more persons whose basic+DA is less than ₹6,500/-

BONUS Applicable: Yes

Shop & Establishment Act: Yes

---
This corrected version addresses the spelling and formatting errors in the original text while preserving the meaning intended by the user.

Hi Rao,

The minimum number of employees applicable for the statutory law is 20. However, you can still apply for these benefits even if you have a low employee count.

Hi,

Is there any law stating that a company pays out bonuses only after the completion of 5 years from the date of establishment?

Dear,

If it is in losses. For more details, please go through The Payment of Bonus Act, 1965.

Regards,
R.N.Khola

(Labour Law & Legal Consultants)
09810405361