Understanding Labor Laws for LLP Firms: Can Anyone Share Insights?

Khushali Parikh
Dear All,

I manage an LLP firm and would like to know the labor laws that are applicable to an LLP firm. Can someone help with the labor law details?

Thank you in anticipation!
Madhu.T.K
There is no separate labor law for LLP firms. All labor laws applicable to other companies, whether they are unlimited liability partnerships, sole proprietary firms, private limited companies, or public limited companies, are applicable to your Limited Liability Partnership as well. Labor laws are made applicable not according to the constitution of the company but based on the number of workers employed and the nature of business carried out, such as manufacturing, mining, trading, etc.

Therefore, if you employ 10 persons directly or through a contractor, whether for a day or long term, whether casually or permanently, you are covered by the ESI Act, EPF & MP Act (though currently it is 20 employees). If you run a factory, you are covered by the Payment of Bonus Act and Payment of Gratuity Act. You are covered by these Acts provided you employ 20 or more in an establishment other than a factory. You are also covered by the Minimum Wages Act, which specifies the lowest wages below which you should not pay wages.

You have to comply with the requirements of the Payment of Wages Act regarding when to disburse wages and in which form. In case you employ 50 or more, you are expected to frame standard procedures to be called Standing Orders. There are guidelines in the Industrial Disputes Act on how to declare layoff or retrench employees. In general, all laws applicable to a factory or commercial establishment will also apply to you.
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