Understanding Off-Payroll vs. On-Payroll: How Do You Decide for Employees?

khadhar.patan
Hi,

What is the meaning of Off-Payroll and On-Payroll? What is the basis of Off-Payroll and On-Payroll? How do we decide if an employee is Off-Payroll or On-Payroll?

Thanks and regards,
Khadhar Basha
teamgrouphr
Greetings for the day ahead!

Off-roll means when an employee is on the payroll of a consultant and not on the rolls of the company. This is done in order to avoid statutory requirements and save costs. A certain fee is paid to the agency to keep the company's employee on their rolls. In such cases, people working for your company are not regarded as your employees but as consultants from the agency on whose roll these people occupy a place.

On-roll refers to a regular employee of the company. In this case, statutory payments such as PF, ESI, etc., have to be paid by the company. Other requirements with respect to employment also need to be met by the company.

As far as the base is concerned, normally, junior-level employees are off-roll or on the rolls of some other agency. However, this is not a thumb rule. In some cases, senior-level people can also be off-roll, especially in the IT/ITES industry. These people are normally those whose services are critical but required only for a short period of time.

Regards,
Team GroupHR
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