Navigating EPF Rules: Do Contractors and International Workers Need Separate EPF Numbers?

Hi, a factory has about 425+ employees on its payroll. The establishment has its own EPF number under the act.

My queries are:
a) If they hire a contractor to supply 5 laborers per day, does the contractor need to have their own EPF number?
b) If the establishment hires an international worker for a six-month job in India, what formalities must the establishment complete under the EPF Act?
I would appreciate it if your answers are supported by the relevant sections of the act, circulars, or rules.

Contractor Commitments and EPF Registration

Please check whether the contractor has other commitments for the supply of labor to other principal employers. Most probably, they will have other contracts similar to yours, in which case they may be subject to EPF formalities. However, to avoid future complications, it is better to ask them to register for EPF for the employees they supply to your establishment.

Employment of International Workers

Regarding the employment of international workers, please visit the EPFO website for proper guidelines. A copy of a circular issued concerning international workers is attached for your reference.

EPFO Coverage for Contractors

In reply to the first query, if a contractor is engaging 5 employees per day, is it necessary to have EPFO coverage for the contractor? My views are as follows:

1. A contractor may or may not supply contract labor to other places, for which the contractor should have one PF code (if the total number of employees in the payroll of said contractor is 20 or more) - it is always better.

2. However, the issue is that the organization has 425+ employees, meaning the organization is covered under PF and ESI. Therefore, whoever works, whether directly or through a contractor, will also be covered under PF & ESI, even if the contractor is engaging only 5 employees. In the case where the contractor has no PF or ESI code, compliance has to be done through the Principal Employer's code.

Please review the definition of an employee under the PF & ESI Act, and your doubt will be clarified.

Regards, S K Bandyopadhyay (Howrah, WB)

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