Statutory Compliances [Thread 524451]

We are a company having around six labour contractors with a total of 90 employees. It is noticed that the payments to PF, ESIC etc are not paid on time by the contractors. Our management have decided to pay the amounts directly to PF etc from our bank account. Is it legally permissible?

it is not possible, you need to insist the contractor for taking individual number from EPF and ESI Office as any violation of this statute, you as a principal employer liable for their non compliance.

Dear Mr Balaji
Please contact us, if you require any professional support to comply with statutory compliance in the engagement of contractors / contract labour, including coverage, recovery and remittance of PF and ESI contribution in our PF and ESI code numbers. We have been providing our service for many of the Group Companies in South India for the last 25 years.
Regards
N Nataraajhan, Sakthi Management Services (HP : + 91 94835 17402 ; e-mail : [Login to view])

Payment to contractor - Its implications are not strategic from practical angles. Normally, contractor should be allowed to reiumbursement what the remittance he paid on evidence and scrutiny of papers he has deposited / paid . That payment can be given as reiumbursement to the contractors. If contractor has his PF and ESI numbers, he will be liable as first part to respective inspections and its regulatory compliance.Please note that Contract Act is subject to regulations and abolitions both. Any artificial arrangement will be untenable. What if when workmen will claim wages equal to regular employees engaged by your company.
.Also, see others they are doing nearby and consult some advisor also.
Regds,
RDS Yadav
Management Advisor and Trainer
Director-Future Institute of Management and Technology

Dear Mr.Balaji,
Pl note that the contractors does not comply the statutory compliance under Contract Labour (R & A) Act, the ultimate responsibility shall bear with Principle Employer. Hence the Principle employer shall remit the contributions of PF, ESI etc., on behalf of contract labour and deduct the amount from the Bills of Contractors.
Thanks & Regards,
V R RAO PULIPAKA

Dear Balaji,
There is no harm to remit PF and ESI from the Account of Company's Codes. Normally Contractors are playing to not to comply as there is low income from Contract work. They Generally try to manage with Company's Personnel Deptt or Govt. Labour Deptt. But responsibility does not be given up. You please appoint a daily wages literate labour of Contractor and allow him making records of all the contractors. Allow him learning from your Labour Officer as to how the records are to be maintained. I have done it once in my career 15 yrs back where all the contractors became ready to pay a month salary to that record keeper.
Regards & Best of Luck