Good evening! I am seeking clarifications on the following:
Applicability of PF and ESI for Canteen Contractor
1. Our company has a canteen run by a private party.
2. They provide breakfast, dinner, supper, and tea/coffee based on coupons.
3. The company will pay the amount based on bills (based on coupons).
4. No raw materials are provided to them.
5. Only steam is provided to them for cooking purposes, for which they are paying 0.50 paise per meal.
6. They have also obtained a license under the contractor labor act. We have included the canteen contractor's name on our RC.
Our clarification is that the principal employer is responsible for the payment of PF and ESI for canteen employees.
Regards,
Ganapathy V
From India
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1Applicability of PF and ESI for Canteen Contractor
1. Our company has a canteen run by a private party.
2. They provide breakfast, dinner, supper, and tea/coffee based on coupons.
3. The company will pay the amount based on bills (based on coupons).
4. No raw materials are provided to them.
5. Only steam is provided to them for cooking purposes, for which they are paying 0.50 paise per meal.
6. They have also obtained a license under the contractor labor act. We have included the canteen contractor's name on our RC.
Our clarification is that the principal employer is responsible for the payment of PF and ESI for canteen employees.
Regards,
Ganapathy V
From India
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As the wages for canteen employees are directly disbursed by the contractor (the company settles the bills to the canteen contractor on a monthly basis, based on the submission of coupons, I suppose), it shall be the responsibility of the canteen contractor to meet the statutory payments towards PF & ESI in respect of his employees.
From India, Aizawl
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From India, Aizawl
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Dear Ganapathy, whoever disburses wages to the workers of the canteen run at and for the establishment, whether the contractor who employs them or the Principal Employer who has entered into a contract falling under the provisions of the CLRA Act, 1970, the PE has the vicarious liability under Section 21(4) of the Act for payment of wages.
Since the definition of the term "employee" under both the ESI Act, 1948, and EPF Act, 1952 includes contract labor also and in view of Section 40 of the ESI Act, the PE has the responsibility to ensure compliance by the contractor in this regard.
From India, Salem
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Since the definition of the term "employee" under both the ESI Act, 1948, and EPF Act, 1952 includes contract labor also and in view of Section 40 of the ESI Act, the PE has the responsibility to ensure compliance by the contractor in this regard.
From India, Salem
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Principal employer liable if contractor fails to pay wages to workers Delhi High Court Judgement.pdf
PF & ESI.zip