Navigating PF and ESIC for Contractors: Do We Need to Register for Benefits?

Hello,

We are a manufacturing unit in Maharashtra that employs 50 employees. Currently, we need to hire a contractor with a maximum workforce of 15 to 20 workers. However, according to the recent amendment, a labor license is not required for up to 50 workers. In this case, is it necessary to register the contractor for PF and ESIC? If not, how can we provide PF and ESIC benefits to our contractual workers?

Please guide me.

Manish Shrivastava HR Executive

Your query contains your answer. As your organization will deploy contract employees who will be working for your organization, hence, it automatically becomes eligible under PF and ESIC. There is no alternative whereby your organization can avoid these statutory norms.

Thanks.
Regards,
Girish Vivalkar
Indian Labour Law and Human Resource: girishvivalkar979.blogspot.in
LinkedIn: https://in.linkedin.com/in/girishvivalkar

Dear colleague,

You are probably mixing the applicability of the Contract Labour Act with PF and ESI. The criteria for applicability of all three Acts are the number of workers, which varies for each.

The Contract Labour Act may or may not be applicable, but PF and ESI will be applicable to the contractor if your establishment is covered under them.

Regards,
Vinayak Nagarkar
HR Consultant

Dear Mr. Manish,

This is in addition to the reply from Mr. Vinayak. If you engage contractors who do not have PF and ESI code numbers, contract employees must be covered under the Principal Employer Code Number. Consequently, engage contractors who already have PF and ESI code numbers.

Applicability of PF & ESI on Contractor's Bill

Our company is registered under PF & ESI, and we are subcontracting work outside the premises. The contractor is deploying 2 to 3 workers. Is PF & ESI applicable on the contractor's bill?

Rangarajan