Transitioning from Partnership to Private Limited: What HR Needs to Know About Labor Rules and Documentation

Dear Sir, We have a small-scale industry in Ambad, Nashik, operating as a partnership firm. We will be transitioning to a private limited company from 1st April 2024. My question is, are there any special rules and regulations related to labor, leave management, required manpower strength, any labor facilities required, and the online documentation for PF & ESIC transfer process for our employees? Please guide me.

Altaf Sayyed
HRD

The change from a partnership firm to a private limited company is a very significant one, though there is continuity in operation. Therefore, all statutory/government authorities related to your operations have to be informed.

Transfer of Undertaking and Employee Benefits

This would be deemed as a transfer of undertaking for all labor-related purposes. Therefore, there should be an understanding among the employees, employers, and directors of the company regarding the treatment of their past service for future calculations of gratuity, etc.

ESI and PF Number Generation

Upon forming a company, a new ESI and PF number would be generated. You have to transfer the employees from the existing RC to the new RC. This will ensure continuity for the benefits under the respective Acts. Naturally, the ESI and UAN would not change.