Is ESI Really Required for Drivers with Less Than Ten Staff? Seeking Your Insights on Client Disputes

Dear All, we have been working as a consultant at a PSU. Furthermore, we have awarded a contract to a transporter for staff vehicle movement. The transporter has a WC Policy and two drivers. However, despite numerous arguments, the client keeps stopping our gate pass frequently citing the ESI of the driver, even though there is a rule that ESI is not applicable for a staff strength below ten. Therefore, we kindly request you to share your experience, any court decisions, or any other relevant information regarding whether this falls under the ESI purview.

As consultants for EPCM jobs, we generally do not obtain a Labor License. We would appreciate an early response. Thank you in advance for your valuable advice. If you have any queries or need further information to reach a decision, please feel free to ask.

Thank you.

Dear Ritesh,

The HR of the PSU, with a different understanding, considered that your drivers are coming to the factory regularly and are of the workmen category. The contract awarded to carry out certain jobs by you; therefore, all persons entering the client's premises shall be considered as your staff. The contract you gave to a transporter for providing vehicles for staff movement has nothing to do with the client. The Workers' Compensation (WC) Policy is different from ESI, so they cannot be compared. The applicability of ESI is squarely on the drivers considered as your workmen, having a salary less than the 21,000 capping.

The Project department of the PSU, who is controlling your project, should issue a letter to CISF to issue a Non-CLC Gate Pass for such a category of people (this is a practice at SAIL, Rourkela). Therefore, you need to discuss the matter with the Commandant of CISF through the Project department for a solution (refer to the case as stated above).

The CL (R&A) license is not required if the agency is doing the awarded job with its own employees. The license is required for employing workmen other than the employees over 20 or the prescribed limit, which may be for EPCM jobs.