My Dear Friend,
Each contractor should get himself an ESI Code and PF Code No. This requirement is a MUST when you think of engaging a Contractor.
If one is NOT eligible for coverage then the concerned party will not be given a Code No. by the concerned authorities.
If the Contractor does NOT have an ESI & PF Code No. where is he going to deposit the money deducted from his employees' wages against ESI & PF?
AS the Principal, please appreciate the practicality of the issue.
The employees under a Contractor are his employees. Therefore the Contractor will be responsible for preparing their Payroll and compliance of all applicable labour laws.
If you as the Principal Employer you decide to do all this, then you might as well take such employees on your own Company's Payroll instead of engaging them through a Contractor.
Under the present circumstances the employees engaged through each respective contractor are NOT eligible for coverage under the ESI & PF since the concerned Contractor is NOT eligible for coverage under the said Statutes.
In case of an employment injury or death, the concerned worker will be entiled to benefits under the Workmen's Compensation Act.
As a measure of abundant caution you may ask the Contrator to get a Personal Accident & Mediclaim Policy for his employees to take care of any such unfortunate mishaps.
Your suggestion, I am sure, is well intended, but not quite the right one.
Best Wishes,
Vasant Nair