Understanding Labor Welfare Fund Deductions: How Do I Remit Payments to the Labor Office?

Hi all,

Please tell me about labor welfare fund deduction details and what is the procedure for remitting the amount to the labor office.

Please help me urgently.

Regards,

Kanaka - Chennai

Hi friends,

Can someone help me with Labour welfare fund? Our company is an IT company in Bangalore with the registered office in Mumbai. Payroll processes are carried out at the registered office. My question is, do we at the Bangalore office have to pay and remit the contribution to the fund at Karnataka Labour Welfare Board?

Regards,
Anu

Dear Sir/Madam,

Could anyone tell me what benefits we receive from the labor welfare fund and how we can access them?

Regards, N. Arumugam.

Dear Anu,

You will need to remit the Labour Welfare contributions to the Board in Karnataka for the employees working in Bangalore, even though your company is registered in Mumbai.

Regards,
Suja

Dear sir,

My company is working in Gurgaon as a contractor on electrical projects. Our main office is located in Mumbai. Could you please inform me if I need to pay the labor welfare fund in Gurgaon? If so, kindly provide details on how to make the payment, including the name for the DD favoring.

I appreciate your assistance in this matter.

Thank you.

Did the company want to pay the Labour Welfare Fund for the contract employers? Kindly guide me.

Welfare Fund as a State Subject

Welfare Fund is a state subject, and the laws pertaining to the payment of (labour) welfare funds differ from state to state. Similarly, there are many Welfare Funds constituted in some states. In Kerala, for example, every class of labor has a separate welfare fund, and there are about 17 Welfare Funds for each class of workers, such as Toddy Workers, Abkari Workers, Beedi and Cigar Workers, Cashew Workers, Shop Workers, Tailors, Construction Workers, etc.

Coverage and Exclusions

The Acts pertaining to these welfare funds have separate treatment concerning the coverage of workers for whom the provident fund has been contributed by the employer. Accordingly, those transport operators covered by the Employees' Provident Fund and Miscellaneous Provisions Act need not pay welfare fund contributions under the Kerala Motor Transport Workers' Welfare Fund Act for employees covered by PF. Under the Kerala Shops and Commercial Establishments Workers' Welfare Fund Act, there is no provision excluding employees of shops or commercial establishments covered by PF from the payment of welfare fund contributions.

However, the Kerala High Court in Kalyani V K Vs District Executive Officer and another (2012 KHC 2987) has held that since the establishments, namely, New India Talkies, Iritty, Kannur, and New India Paradise DTS Cine House, Iritty, Kannur, are establishments covered by the Provident Fund Act, which is a central enactment, there is no need to contribute separately to a welfare fund with the same objective.

Judicial Observations

The Kerala High Court, in another case (Unni Mammu Haji vs. State of Kerala, 1989 (1) KLT 729), has observed that the Welfare Fund Act passed by the State Legislature applies only to establishments to which the Central Act does not apply. Therefore, an establishment contributing to the provident fund, which is a welfare contribution, does not necessarily have to contribute to another welfare fund with the same objective.

Coverage for Non-PF Act Workers

In the case of coverage due to non-coverage of the PF Act, certainly, all workers, whether employed directly or indirectly (through a contractor), shall be covered. In the latter case, it will be the obligation of the principal employer to ensure that the contract workers are covered by the welfare fund.

State Management of Welfare Funds

The Welfare Fund, being a state-managed fund, should be remitted in the state where the employees work.

Regards,
Madhu.T.K