Subcontracting Facility Management: Are We Responsible for ESIC and PF Compliance?

Hello,

My query is, if I employ a facility management company that charges per square foot instead of per employee, will my company then be liable to check if they are following ESIC and PF rules and regulations? Additionally, if they fail to pay the PF and ESIC, will my company be liable in that case?

Compliance with ESI and EPF Acts

Please confirm whether your company or unit is covered or coverable under the ESI Act, 1948, as well as under the EPF & MPs Act, 1952.

If covered under the above Acts or any of the above Acts, compliance in respect of contractor employees (if receiving wages within the coverable limit) is required to be made positively. The mode of engagement of the contractor, whether on a square foot area basis, lump sum basis, or any other basis, is of no importance and is irrelevant. Similarly, whether you or your contractor pay the contractor employee on a piece-rate basis, daily basis, or any other basis is also irrelevant. The important issue is only that the employee is working relating to or in connection with the work of the factory or unit.

Please check ESI & EPF compliance in respect of employees posted to your establishment based on attendance register & salary abstract. You can link the respective contractor in the ESI portal & EPF portal to track compliance status on a monthly basis. You, as the principal employer, will be held responsible for non-compliance.