Outsourcing Labor: What ESIC/EPFO Compliance Should My Contractor Follow?

Dear Experts, I am an employer registered under ESIC/EPFO. I am outsourcing some laborers through a contractor, and I shall pay the contractor directly.

Statutory compliances under ESIC/EPFO

What are the statutory compliances under ESIC/EPFO for my contractor that should be maintained?

Thanks & Regards

Dear Krishanu, I hope the contractor you have engaged has PF and ESIC codes for compliance. If not, compliance must be established using your organization's codes.

Before processing the contractor's invoice each month, verify the compliance status not only through the challan but also on the PF and ESIC sites after obtaining the user's ID and password from the contractor.

If you pay GST to the contractor, it is also necessary to verify this along with PTAX for complete compliance.

Thanks and Regards,

S K Bandyopadhyay (WB, Howrah)

The Employees' State Insurance Corporation (ESIC) maintains a cash and medical benefits scheme for employees earning Rs 21,000 or less per month. Any non-seasonal factory or establishment that consists of 10 or more employees is covered under the Employees' State Insurance Act 1948.

Provident Fund (PF)
The PF is a compulsory contributory fund for employees' future after retirement or death. Any company with 20 or more employees must be EPFO-compliant. You may also read the following article which gives you an overview of labor laws:

https://akriviahcm.com/hr-glossary/s...ry-compliance/

Compliances for Vendors

Compliances for vendors include the maintenance of all statutory compliance as per the Contract Labour (Regulation & Abolition) Central Rules, 1971.

In general, compliance is required to be maintained by vendors. As the principal employer to the vendor, you must closely monitor compliances in respect of:

1) CLRA Act - Obtaining a labor license as per the stipulated number of manpower on contract.
2) Compliance under ESIC
3) Compliance under EPF
4) Compliance under PTRC
5) Compliance under LWF
6) Leave with Wages Act
7) Bonus Act
8) Compliance under Maternity Act (if hiring females on contract)
9) Compliance under Migrant Workers Act
10) Compliance under Minimum Wages Act
11) Overtime compliance
12) Compliance under Payment of Gratuity Act
13) Compliance under Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013 ("POSH Act") (if hiring females on contract)