Understanding EPF and ESIC in Dual Employment Scenarios: Insights & Solutions

Dear Sir/Madam,

I am K. Sudhakar, working for Medicure Diagnostic & Research Centre for the last 14 years, and my employer is paying EPF, but there is no ESI coverage here. I have recently joined another diagnostics center as a part-time employee while still working at the old organization where I have been employed for 14 years. The new employer provides ESI benefits but does not offer EPF contributions. I have applied for ESI coverage at the new office.

The issue now is that my old employer has ceased paying EPF contributions since last month and insists that EPF and ESI should be managed by a single employer. They have advised me to pay EPF contributions from the organization where I work part-time.

Is this information accurate, and what would be the appropriate solution to this situation? Your assistance in resolving this matter would be greatly appreciated.

Thank you.
Sudhakar Kota
9849020625

Dear Sir,

Your question is not clear.

There are two things to consider:

1. If you are working full-time with any organization, the principal employer is mandatory to pay EPF (if the total employee strength is more than 20). If your organization is in an ESIC-covered area, it is also mandatory to pay.

2. At the same time, you cannot avail the benefits of EPF & ESIC from both organizations.

3. Additionally, you cannot receive EPF benefits from Organization "A" and ESIC benefits from Organization "B."

Regards,
Digamber

Dear Sudhakar,

Yes, it is true that the benefits of ESI & EPF can be availed only from one employer and not from multiple employers, as is the case with you. My advice to you would be to transfer your EPF accumulations to the provident fund of the new establishment.

BS Kalsi
Member since Aug 2011

If you are working for multiple organizations, each of your employers is required to pay PF unless you are an exempt employee. Your first employer cannot close your PF account while you are still working there.

About ESIC, I am not sure how it works. Some of the other seniors will need to clarify that.

Dear Sudhakar,

In India, double employment is not permitted, i.e., you cannot work in two organizations simultaneously. Now you have been working in organization A for 14 years. It would be better for you to continue there officially. Officially means by availing all statutory benefits like PF, ESI, etc. (Doing part-time work is up to you to manage and should not be brought into the legal employment front).

ESI coverage has two criteria:
(a) It covers those who earn a monthly gross salary up to Rs. 15,000.
(b) It applies if the area where your organization is situated is under the ESI-covered area. If your current organization (A) does not provide you with ESI benefits, it means either you or your organization may not meet one or both of the above criteria.

If you are considering organization B only for ESI benefits, check if your monthly salary meets the mentioned criteria. Additionally, since it is a part-time job, its duration may vary. Consider what you want to do - continue with your current company or switch to a new one. Also, the absence of PF benefits in organization B indicates that either it employs fewer than 20 employees, or you may be exempted due to your basic salary (plus applicable DA) being above Rs. 6,500 per month.

In my personal opinion, it would be better for you to continue with organization "A" officially and make use of whatever benefits they offer. If you can manage organization B unofficially, that is your choice; however, do not combine the two.

With regards,

Suresh

Kindly let us know first of all whether your full-time employer has knowledge of your part-time employment, as all appointment letters have a clause barring the employee from engaging in any other employment. Therefore, it is better to keep silent and let the full-time employer pay PF, and the part-time employer pay ESI contributions.

Regards,
N. Raghavendran

Dear Sudhakar,

It is correct that you cannot claim the same statutory benefits (PF, ESIC, etc.) from various organizations for the same period. But in your case, you are enjoying these benefits as per the coverage of the respective organizations and that too under two different acts, so there is no duplicacy on your part. Hence, your previous organization should continue to pay your EPF contributions and ESI by the new organization. It is nowhere mentioned that PF & ESI should be provided by only one employer as it varies by applicability and coverage to every organization. However, it is very true that duplicacy should not be there in receiving these benefits by one common employee.

Dear Sudhakar,

Mr. Suresh P. is right. Please follow and shed more light on your query while considering the points made by Mr. Suresh P.

Part-time employment in two establishments is not prohibited in the EPF Act. Please read para 22(2) and the explanation under the EDLI scheme.

Varghese Mathew

Dear friends,

Here in this case, there are a few questions:

1. Whether he "E" can work full-time in "A" employer and part-time in "B" employer.
2. If so, whether "A" is right in denying ESI but was giving EPF which is sought to be stopped.
3. Whether "B" is right to give ESI to the part-time employee but not the EPF.
4. What is the remedy to "E"?

To clarify, my views are as follows:
1. Yes, E can do so.
2. "A" should give both EPF & ESI as he is employed full-time. (I believe "A" is covered under the ESI Act.)
3. "E" is not entitled to get both EPF & ESI from both A & B (Probably E should content with EPF from A and ESI from B.)
4. E should impress upon A that they should meet both EPF & ESI if otherwise eligible.

Kumar,

I differ slightly on the above. It is possible that A is not covering E under ESIC because his salary is above 15,000 or that the location is not covered by ESIC. In that case, not giving ESIC is okay, but PF cannot be stopped as long as he is working there.

In the case of B, he should be paying PF as the employee has an existing PF account. PF rules allow getting PF from two different employers at the same time. I think he should get ESIC from B in any case as long as his gross wages from B do not exceed 15,000. Else, B will have a problem explaining it to the authorities. I agree, E should ask A not to discontinue the payment of PF as it will cause problems for A.

Of course, we are assuming that A is aware of and approves the part-time employment. Incidentally, the Factory Act prohibits double employment. If both A and B are factories, then it is the duty of both employers to prevent the employee from working in two places.

Thank you.

No, the Factories Act has not prohibited double employment. See sec 60 and the rules made under it. A worker can engage in double employment with the approval of the Inspector subject to the restrictions as per the state rules.

VARGHESE MATHEW

Dear Sir,

I have been working in Organisation Company, which is from India and registered in Lanka as well. For the past 2 years, I have been working in Lanka, and the company has been deducting my EPF and ETF from my salary. However, the issue is that the company has not provided me with a salary slip, EPF slip, or EPF number since I joined.

Company Name: METRIC INFRA LANKA PVT LTD

Kindly advise me on what steps I should take.

MADHUP MAYANK COLOMBO, SRI LANKA