Navigating LWF Deductions: Should We Follow Tamil Nadu Rules or Local Branch Regulations?

Dear All,

Our head office is located in Chennai, and we have branches in other metros and some major cities. All their salaries are processed in Chennai. Do we have to deduct LWF for the employees located in other regions as per Tamil Nadu LWF rules or the rules based on the states where the branches are located?

Kindly advise.

Regards,
Karthik

Dear Karthik,

As per the explanation in Sec. 2(d) which defines the term "establishment" under the TN Labour Welfare Fund Act, 1972, the branches situated in the same place of the establishment or at different places are to be treated as parts of the establishment. Therefore, you are required to make deductions towards welfare fund contributions for your employees working in other states as well.

If your employees are posted in other states and salaries are being disbursed in other states, LWF contributions according to the Acts & Rules of the states must be complied with.