Hi, I am an independent service engineer working in the mechanical field. My work involves traveling to different companies and servicing machinery supplied by a dealer in India. I have a firm registered under my name (Shop Act, not registered under GST), and I don't have any employees; I bill the dealer for my work.
PF and ESI Requirements for Independent Workers
However, in the past few years, companies have insisted on PF and ESI for the people working on the machinery. As an independent working person, is there any law that allows working for people like me without having PF and ESI?
Note: I cannot deal directly with the companies.
From India, Pune
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PF and ESI Requirements for Independent Workers
However, in the past few years, companies have insisted on PF and ESI for the people working on the machinery. As an independent working person, is there any law that allows working for people like me without having PF and ESI?
Note: I cannot deal directly with the companies.
From India, Pune
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Independent contractors and ESI/EPF coverage
Independent contractors are not covered under ESI or EPF. Suppose Company A has purchased machinery from a manufacturer or dealer, for example, CG, and the dealer has asked you to visit Company A's site to install or service the machinery. Accordingly, you visit Company A and perform the required installation or servicing activities. In this scenario, as far as Company A is concerned, you are not an employee but rather engaged to complete specific work.
For Company A, the machinery constitutes a capital item, and repairing it is not a regular activity. Their operations focus on producing something using the machinery. When any repairs are carried out by an outsider, it can be part of an arrangement known as an annual maintenance contract (AMC) or part of the purchase process (installation without which the purchase process will not be completed). In such scenarios, any payment made to you will not attract ESI or EPF.
From India, Kannur
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4526Independent contractors are not covered under ESI or EPF. Suppose Company A has purchased machinery from a manufacturer or dealer, for example, CG, and the dealer has asked you to visit Company A's site to install or service the machinery. Accordingly, you visit Company A and perform the required installation or servicing activities. In this scenario, as far as Company A is concerned, you are not an employee but rather engaged to complete specific work.
For Company A, the machinery constitutes a capital item, and repairing it is not a regular activity. Their operations focus on producing something using the machinery. When any repairs are carried out by an outsider, it can be part of an arrangement known as an annual maintenance contract (AMC) or part of the purchase process (installation without which the purchase process will not be completed). In such scenarios, any payment made to you will not attract ESI or EPF.
From India, Kannur
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(Fact Checked)-Your input is largely accurate. As an independent contractor, you're typically exempt from ESI and EPF. Keep up the insightful posts! (1 Acknowledge point)