Hi,
We have a team of 28 working in the IT domain, wherein 19 are permanent employees, and 9 are on probation or training. All employees have a basic salary of more than 6500/- and a gross of more than 15000/-. My question is whether it is an absolute must to apply for PF/ESI registration in such a situation and is the company legally liable for deducting PF/ESI? Also, what are the penalties/fines in case the company does not register/deduct PF/ESI?
Please let me know if you need more information. Assistance and guidance will be highly appreciated.
From India, Delhi
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We have a team of 28 working in the IT domain, wherein 19 are permanent employees, and 9 are on probation or training. All employees have a basic salary of more than 6500/- and a gross of more than 15000/-. My question is whether it is an absolute must to apply for PF/ESI registration in such a situation and is the company legally liable for deducting PF/ESI? Also, what are the penalties/fines in case the company does not register/deduct PF/ESI?
Please let me know if you need more information. Assistance and guidance will be highly appreciated.
From India, Delhi
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Dear Yogesh,
For ESI & PF registration, a minimum of 20 staff should be present, and you have to register them accordingly.
1) ESI: If an employee's gross salary is more than 15000, then they are eligible for medical benefits.
2) PF: If a staff member's basic salary exceeds 6500, you can only deduct PF contributions based on the 6500 limit. For example, if XYZ's basic salary is 6500, deduct PF contributions on that amount.
For more information, please visit the following sites:
ESI: :: Welcome to ESIC ::
PF: EPFO
Thank you.
From India, Madras
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19For ESI & PF registration, a minimum of 20 staff should be present, and you have to register them accordingly.
1) ESI: If an employee's gross salary is more than 15000, then they are eligible for medical benefits.
2) PF: If a staff member's basic salary exceeds 6500, you can only deduct PF contributions based on the 6500 limit. For example, if XYZ's basic salary is 6500, deduct PF contributions on that amount.
For more information, please visit the following sites:
ESI: :: Welcome to ESIC ::
PF: EPFO
Thank you.
From India, Madras
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Even though the gross salaries of all the employees exceed Rs. 6500 p.m. and Rs. 15000 p.m., if you are covered by ESI and EPF Acts, you need to register under the relevant Acts.
B. Saikumar
HR and Labour Law Advisor
Mumbai
From India, Mumbai
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B. Saikumar
HR and Labour Law Advisor
Mumbai
From India, Mumbai
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(Fact Checked)-The user's reply is correct. In cases where the establishment is covered under the ESI & EPF Acts, registration under these Acts is mandatory, regardless of the salary levels. The company would be legally liable for deducting PF/ESI in such a scenario. (1 Acknowledge point)
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Dear Yogesh eventhough, they are crossing the limit, there may be some employees may get lesser basic to Rs.6500/ for those employees your organisation must be covered under the EPF
From India, Madras
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From India, Madras
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Hi Subba,
None of the employees has a basic salary of less than 6500/-, other than the peon whose payout happens in cash. Thus, it's quite confusing as I'm getting different feedback/opinions from different PF/ESI consultants. I request all you experts to provide your best thoughts on the same.
Also, please share what can be the implications if we do not register for PF/ESI. What are the penalties, etc.?
Regards,
Yogesh
From India, Delhi
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None of the employees has a basic salary of less than 6500/-, other than the peon whose payout happens in cash. Thus, it's quite confusing as I'm getting different feedback/opinions from different PF/ESI consultants. I request all you experts to provide your best thoughts on the same.
Also, please share what can be the implications if we do not register for PF/ESI. What are the penalties, etc.?
Regards,
Yogesh
From India, Delhi
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Dear Sir We have start newly in milk company at Coimbatore dist, Tamilnadu now our staff strength is 12 let us know now start with esi registration or after 20 staff only register?
From India, Bangalore
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From India, Bangalore
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Dear Yogesh,
For peon categories, you have to be covered under EPF and ESI. If not, the enforcement officer or social security officer (ESI inspector) may accidentally come for an inspection. At that time, you will have to face problems, and your liabilities will be high.
Regards,
V. Subbarao
From India, Madras
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For peon categories, you have to be covered under EPF and ESI. If not, the enforcement officer or social security officer (ESI inspector) may accidentally come for an inspection. At that time, you will have to face problems, and your liabilities will be high.
Regards,
V. Subbarao
From India, Madras
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Hi Yogesh ji,
You have a total of 28 employees on your payroll, and all are drawing a basic salary of more than Rs. 6500 per month and a gross salary of more than Rs. 15000 per month. In this case, the PF Act is applicable to you, but the ESI Act is not.
To be subject to PF regulations, the count of employees matters, regardless of their salary. However, for ESI, only employees with a gross salary of up to Rs. 15000 per month are considered.
Even if all 28 employees choose not to contribute to PF and are categorized as "excluded employees" as per the Act, you are still required to obtain a PF code and make a monthly remittance of a total of Rs. 7. Your liability begins from the month you reach a headcount of 20 employees.
The threshold for ESI coverage has been reduced to 10 employees in most states, except for Maharashtra, where it remains at 20.
Your peons and other indirect employees, if you have any, pose a gray area of concern for you.
From India, Mumbai
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You have a total of 28 employees on your payroll, and all are drawing a basic salary of more than Rs. 6500 per month and a gross salary of more than Rs. 15000 per month. In this case, the PF Act is applicable to you, but the ESI Act is not.
To be subject to PF regulations, the count of employees matters, regardless of their salary. However, for ESI, only employees with a gross salary of up to Rs. 15000 per month are considered.
Even if all 28 employees choose not to contribute to PF and are categorized as "excluded employees" as per the Act, you are still required to obtain a PF code and make a monthly remittance of a total of Rs. 7. Your liability begins from the month you reach a headcount of 20 employees.
The threshold for ESI coverage has been reduced to 10 employees in most states, except for Maharashtra, where it remains at 20.
Your peons and other indirect employees, if you have any, pose a gray area of concern for you.
From India, Mumbai
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Dear Administrators, My request to remove the anonymous from my above posting. it was done by mistake. Accidentally the botton got pressed of my iPhone.
From India, Mumbai
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From India, Mumbai
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Even the ESI Act is applicable when the number of persons employed in the establishment is 20 or more, irrespective of their wages exceeding Rs. 15,000 per month.
B. Saikumar
HR & Labour Law Advisor
Mumbai
From India, Mumbai
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B. Saikumar
HR & Labour Law Advisor
Mumbai
From India, Mumbai
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(Fact Checked)-The user's reply is correct. Thank you for sharing accurate information on the applicability of the ESI Act. (1 Acknowledge point)
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Dear Saikumar ji,
Greetings of the day - Sunday!
With due respect to you, I wish to draw your kind attention to the fact that, based on the Supreme Court Judgment ESIC Vs MM Suri Associates, New Delhi (1998), the Corporation decided to consider only coverable employees under section 2(9) for coverage of a factory or establishment under ESI. This decision was made applicable in 1998. Furthermore, there was an amendment in section 2(9) in 2010.
From India, Mumbai
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Greetings of the day - Sunday!
With due respect to you, I wish to draw your kind attention to the fact that, based on the Supreme Court Judgment ESIC Vs MM Suri Associates, New Delhi (1998), the Corporation decided to consider only coverable employees under section 2(9) for coverage of a factory or establishment under ESI. This decision was made applicable in 1998. Furthermore, there was an amendment in section 2(9) in 2010.
From India, Mumbai
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Dear Yogesh,
It is compulsory for you to get registered with the ESI Authority if you are employing 10 employees (direct and indirect) and required to be registered under the provisions of section 1(3) of the EPF and MP Act if you are employing 20 or more employees (direct and indirect). In accordance with the provisions stipulated in ESI as well as in the EPF Act, you are required to get registered with the concerned Office of your area if the provisions of the act are applicable to your establishment.
In case of non-registration, at a later stage, if the concerned Authority conducts a survey and finds that you are not covered under the ESI and EPF Act, you will be covered with retrospective effect from the date when you had the minimum number of employees as per the requirement of the ESI and EPF and MP Act. Therefore, proceed with the registration of your establishment to the SRO/RO of your area.
Thanks & Regards,
R B Yadav
Advocate
From India, Gurugram
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It is compulsory for you to get registered with the ESI Authority if you are employing 10 employees (direct and indirect) and required to be registered under the provisions of section 1(3) of the EPF and MP Act if you are employing 20 or more employees (direct and indirect). In accordance with the provisions stipulated in ESI as well as in the EPF Act, you are required to get registered with the concerned Office of your area if the provisions of the act are applicable to your establishment.
In case of non-registration, at a later stage, if the concerned Authority conducts a survey and finds that you are not covered under the ESI and EPF Act, you will be covered with retrospective effect from the date when you had the minimum number of employees as per the requirement of the ESI and EPF and MP Act. Therefore, proceed with the registration of your establishment to the SRO/RO of your area.
Thanks & Regards,
R B Yadav
Advocate
From India, Gurugram
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(Fact Checked)-[The user reply contains accurate information regarding the requirement for ESI and EPF registration based on the number of employees. The advice to register the establishment with the concerned office is valid.] (1 Acknowledge point)
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Dear keshav ji
Greetings.My view is based on the following interpretation.
Sec.1(4) of ESI Act states that the ESI Act in the first instance is applicable to all factories other than seasonal factories. Now, Sec.2(12) defines a facto y as under:
“ factory ” means any premises including the precincts thereof whereon ten or more persons are employed or were employed on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on or is ordinarily so carried on, but does not include a mine subject to the operation of the Mines Act, 1952 (35 of 1952), or a railway running shed ;]
Thus sec.1(4) read with Sec.2(12) unfolds that the ESI Act is applicable to factories where in ten or more persons are merely employed and it does not say that they shall be employed 'for wages'. It is enough if ten or more ppersons aremerely working in a manufacturing process, it attracts ESI Act. Since the definition does not refer to employment on wages, there is no need to link the definition of factory to the definition of employee under Sec.2(9) which prescribes a wage limit.Accordingly, all persons employed in a factory irrespective whether they are drawing coverable wage or not, need to be counted for computing ten or more persons employed in a factory.
You are right. M.M Suri's case was governing the field on the issue of number of persons employed in afcatory being restricted to only those drawing coverable wage. But after the amendment of definition of Factory in 2010, it no longer does.
B.Saikumar
Hr & Labour Law Advisor
Mumbai
From India, Mumbai
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Greetings.My view is based on the following interpretation.
Sec.1(4) of ESI Act states that the ESI Act in the first instance is applicable to all factories other than seasonal factories. Now, Sec.2(12) defines a facto y as under:
“ factory ” means any premises including the precincts thereof whereon ten or more persons are employed or were employed on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on or is ordinarily so carried on, but does not include a mine subject to the operation of the Mines Act, 1952 (35 of 1952), or a railway running shed ;]
Thus sec.1(4) read with Sec.2(12) unfolds that the ESI Act is applicable to factories where in ten or more persons are merely employed and it does not say that they shall be employed 'for wages'. It is enough if ten or more ppersons aremerely working in a manufacturing process, it attracts ESI Act. Since the definition does not refer to employment on wages, there is no need to link the definition of factory to the definition of employee under Sec.2(9) which prescribes a wage limit.Accordingly, all persons employed in a factory irrespective whether they are drawing coverable wage or not, need to be counted for computing ten or more persons employed in a factory.
You are right. M.M Suri's case was governing the field on the issue of number of persons employed in afcatory being restricted to only those drawing coverable wage. But after the amendment of definition of Factory in 2010, it no longer does.
B.Saikumar
Hr & Labour Law Advisor
Mumbai
From India, Mumbai
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Dear Yogesh Ji,
You should register your establishment under EPF Act 1952 and need to submit the contribution of Rs. 7/-, i.e., Rs. 5 for A/c 2 and Rs. 2 for A/c 22 on a monthly basis. If any employee falls into this category, then you should implement the rules as per the act. For ESI, you should do voluntary registration, and there is no need to submit any challan. If even a single employee falls into the ESIC category, then you should provide the benefits to the employee or employees. This way, nobody can challenge for statutory compliance purposes on behalf of EPF and ESIC.
Regards,
Sunil Sharma
From India, New Delhi
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You should register your establishment under EPF Act 1952 and need to submit the contribution of Rs. 7/-, i.e., Rs. 5 for A/c 2 and Rs. 2 for A/c 22 on a monthly basis. If any employee falls into this category, then you should implement the rules as per the act. For ESI, you should do voluntary registration, and there is no need to submit any challan. If even a single employee falls into the ESIC category, then you should provide the benefits to the employee or employees. This way, nobody can challenge for statutory compliance purposes on behalf of EPF and ESIC.
Regards,
Sunil Sharma
From India, New Delhi
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Dear Sunil ji,
Can you please tell me the provision under ESI for voluntary registration?
To my knowledge, under ESI, there is no provision for voluntary registration. It is mandatory when you reach 10/20 coverable employees.
From India, Mumbai
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Can you please tell me the provision under ESI for voluntary registration?
To my knowledge, under ESI, there is no provision for voluntary registration. It is mandatory when you reach 10/20 coverable employees.
From India, Mumbai
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Dear Keshav Sir,
You are absolutely right that there is no provision for voluntary coverage under ESIC.
But whenever inspection will happened then concerned E.O. will consider your exempted employees to covered your establishment under ESIC as per new definition which is mentioned below with example:
NEW DEFINITION:-
Sec 2 (12) "factory" means any premises including the precincts thereof whereon ten or more persons are employed or were employed on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on or is ordinarily so carried on, but does not include a mine subject to the operation of the Mines Act, 1952 or a railway running shed;’.
On comparing the both the following implications of the amendment comes out:-
• Now the units where manufacturing activities are performed by 10 or more PERSONS has been brought under the ambit of the Act, irrespective of use of POWER and irrespective of the fact that 10 or more coverable employees are engaged or not.
• The definition of the "Factory" has been amended to bring the small units within the ambit of the Act. Earlier the ESI Act was applicable to units employing 10 or more persons manufacturing with aid of "POWER"- Now the word POWER has been ommitted. Thus, every unit manufacturing and employing 10 or more persons has been brough under the ambit of the ESI Act.
• Secondly, one hidden amendment has been made in the Act-The uncovered employees would also be counted for the purpose of applicability of the ESI Act. Earlier the unit employing 10 or more workers and doing manufacturing process, would still be out of the purview of the Act, if there are Persons drawing salary above the prescribe limit. Let me explain with an example-
Suppose in a unit there were 12 employees and using Power to manufacture. Out of the said 12 employees
3 employees were drawing salary above the prescribed limit of Rs. 10000/-(or 15000/-). The ESI Act would
not be applicable on the said unit, since the strength of the coverable employees is less than 10.
But now, the ESI Corpn. has very smartly omitted the words " for wages" in the new definition of the
"Factory", bringing all the units employing 10 or more Persons and engaged in manufacturing process
within its ambit
From India, New Delhi
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You are absolutely right that there is no provision for voluntary coverage under ESIC.
But whenever inspection will happened then concerned E.O. will consider your exempted employees to covered your establishment under ESIC as per new definition which is mentioned below with example:
NEW DEFINITION:-
Sec 2 (12) "factory" means any premises including the precincts thereof whereon ten or more persons are employed or were employed on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on or is ordinarily so carried on, but does not include a mine subject to the operation of the Mines Act, 1952 or a railway running shed;’.
On comparing the both the following implications of the amendment comes out:-
• Now the units where manufacturing activities are performed by 10 or more PERSONS has been brought under the ambit of the Act, irrespective of use of POWER and irrespective of the fact that 10 or more coverable employees are engaged or not.
• The definition of the "Factory" has been amended to bring the small units within the ambit of the Act. Earlier the ESI Act was applicable to units employing 10 or more persons manufacturing with aid of "POWER"- Now the word POWER has been ommitted. Thus, every unit manufacturing and employing 10 or more persons has been brough under the ambit of the ESI Act.
• Secondly, one hidden amendment has been made in the Act-The uncovered employees would also be counted for the purpose of applicability of the ESI Act. Earlier the unit employing 10 or more workers and doing manufacturing process, would still be out of the purview of the Act, if there are Persons drawing salary above the prescribe limit. Let me explain with an example-
Suppose in a unit there were 12 employees and using Power to manufacture. Out of the said 12 employees
3 employees were drawing salary above the prescribed limit of Rs. 10000/-(or 15000/-). The ESI Act would
not be applicable on the said unit, since the strength of the coverable employees is less than 10.
But now, the ESI Corpn. has very smartly omitted the words " for wages" in the new definition of the
"Factory", bringing all the units employing 10 or more Persons and engaged in manufacturing process
within its ambit
From India, New Delhi
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Dear Keshav Sir,
If the company is facing a situation similar to the one explained by Mr. Yogesh and is utilizing contract labor, what would be the course of action?
If the contractor fails to deposit the ESIC contribution, who is responsible for making the deposit, and where should it be made?
Regards, Sunil Sharma
From India, New Delhi
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If the company is facing a situation similar to the one explained by Mr. Yogesh and is utilizing contract labor, what would be the course of action?
If the contractor fails to deposit the ESIC contribution, who is responsible for making the deposit, and where should it be made?
Regards, Sunil Sharma
From India, New Delhi
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Dear All,
As rightly said by Saikumar ji and by some other members also, effective from 01.06.2010, factories within the purview of section 2(12) would get covered under ESI where 10 or more persons are employed without any reference to the quantum of wages. According to section 1(5), the coverage of establishments to which the appropriate Government is the State, 20 coverable employees are taken into account irrespective of whether they are regular, temporary, casual, contract, daily rated, piece-rated, etc.
For the coverage of establishments to which the appropriate Government is Central, 20 coverable employees belonging to the category "casual & contract" only are to be taken into account. In the case of contractors, there must be 20 coverable employees. The question of having the requisite number of employees on the premises does not arise since the establishment need not have any premises.
The threshold limit of coverage of 20 is reduced to 10 by many States.
From India, Mumbai
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As rightly said by Saikumar ji and by some other members also, effective from 01.06.2010, factories within the purview of section 2(12) would get covered under ESI where 10 or more persons are employed without any reference to the quantum of wages. According to section 1(5), the coverage of establishments to which the appropriate Government is the State, 20 coverable employees are taken into account irrespective of whether they are regular, temporary, casual, contract, daily rated, piece-rated, etc.
For the coverage of establishments to which the appropriate Government is Central, 20 coverable employees belonging to the category "casual & contract" only are to be taken into account. In the case of contractors, there must be 20 coverable employees. The question of having the requisite number of employees on the premises does not arise since the establishment need not have any premises.
The threshold limit of coverage of 20 is reduced to 10 by many States.
From India, Mumbai
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(Fact Checked)-The user's reply contains accurate information regarding the coverage criteria for ESI based on the number of employees in different types of establishments. The details provided align with the latest laws and regulations. (1 Acknowledge point)
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Dear Keshav Ji,
Even while extending the applicability of the ESI Act to establishments by virtue of notification under Sec. 1(5), the appropriate governments in some cases have followed the language of the amended definition of a factory under Sec. 2(12) in the notifications. For example, the Central Government, via its notification dated 23rd March 2011, covered all the shops, hotels, and transport services located in the National Capital Territory if they merely employ ten or more persons. Here also, the notification does not specify that the persons shall be employed for wages. Thus, in this case also, establishments are covered, in my view, if the number of employees is ten or more, irrespective of whether they draw wages of Rs. 15,000/- or less per month. A similar notification was issued by the Gujarat State as well. It implies that some states have followed the example of the central amendment while issuing notifications under Sec 1(5). However, the State of Maharashtra has not amended the notification, and therefore, as per the existing notification, establishments are covered provided the number of coverable employees is 20 or more. However, members can verify with ESIC.
B. Saikumar
HR & Labour Law Advisor
Mumbai
From India, Mumbai
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Even while extending the applicability of the ESI Act to establishments by virtue of notification under Sec. 1(5), the appropriate governments in some cases have followed the language of the amended definition of a factory under Sec. 2(12) in the notifications. For example, the Central Government, via its notification dated 23rd March 2011, covered all the shops, hotels, and transport services located in the National Capital Territory if they merely employ ten or more persons. Here also, the notification does not specify that the persons shall be employed for wages. Thus, in this case also, establishments are covered, in my view, if the number of employees is ten or more, irrespective of whether they draw wages of Rs. 15,000/- or less per month. A similar notification was issued by the Gujarat State as well. It implies that some states have followed the example of the central amendment while issuing notifications under Sec 1(5). However, the State of Maharashtra has not amended the notification, and therefore, as per the existing notification, establishments are covered provided the number of coverable employees is 20 or more. However, members can verify with ESIC.
B. Saikumar
HR & Labour Law Advisor
Mumbai
From India, Mumbai
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Hi,
We are a private Ltd company involved in stockbroking in Mumbai. We have more than 20 employees who are drawing a basic salary of less than 15,000, and we have registered them under PF. My query is whether we need to register them under ESIC as well. The ESIC act does not specify that commercial establishments like us must enroll. Can anyone please provide the relevant clause or notification from the Maharashtra government if we are covered?
From India, Mumbai
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We are a private Ltd company involved in stockbroking in Mumbai. We have more than 20 employees who are drawing a basic salary of less than 15,000, and we have registered them under PF. My query is whether we need to register them under ESIC as well. The ESIC act does not specify that commercial establishments like us must enroll. Can anyone please provide the relevant clause or notification from the Maharashtra government if we are covered?
From India, Mumbai
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We have multiple companies running under one roof, and all the businesses are different. Salaries of all employees are paid from the different companies (with none of them being over twenty at any point in time). However, attendance of all employees was maintained in a single register without the name of any company. Only for a couple of months a few years back did the count in the attendance register reach twenty, of which one was a personal driver. The ESIC officer is telling us that we now come under the ambit of the act because we maintained a single register for all twenty employees.
Is he correct, or can we contest his order?
From India, Mumbai
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Is he correct, or can we contest his order?
From India, Mumbai
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(Fact Checked)-The ESIC officer is correct. As per the Employees' State Insurance Act, once the total number of employees reaches 20, ESIC registration becomes mandatory. Maintaining a single register for all 20 employees is a valid criterion for coverage. (1 Acknowledge point)
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Yogesh,
I was facing the same problem a few days back. Then, I spoke to an ESI representative who explained that ESI is mandatory for employees with a gross salary of less than 15,000. However, if the salary exceeds this amount, the employee is eligible for PF. Companies need to file for EPF if they have more than 20 employees, but it is not always mandatory; exemptions can be granted.
From India, Delhi
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I was facing the same problem a few days back. Then, I spoke to an ESI representative who explained that ESI is mandatory for employees with a gross salary of less than 15,000. However, if the salary exceeds this amount, the employee is eligible for PF. Companies need to file for EPF if they have more than 20 employees, but it is not always mandatory; exemptions can be granted.
From India, Delhi
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i just want to know that what is the criteria of ESIC for logistic companies?
From India, Vadodara
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From India, Vadodara
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Tell me what is the minimum days for an individual to be enroll with esi and pf
From India, New Delhi
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From India, New Delhi
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(Fact Checked)-The minimum days for an individual to enroll with ESI and PF is 30 days. This requirement is stated under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, and the Employees' State Insurance Act, 1948. (1 Acknowledge point)
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Sir
As such you are deploying with 28 number of employees, i have gone through all of the posts, i would like to draw the attention of all of the readers to the following provisions separately for ESI as well for Provident Fund.
Applicability of the ESI Act, 1948
Pursuance to the Employees' State Insurance Act, 1948, there are two sections stipulated in the Act are section 1(3) which is concerned with the applicability of the act upon factories where any type of manufacturing activity is carried out.
the other section is section 1 (5) which empower the Central Government to extend all or any of the provisions of the Act to any other establishment or class of establishments, industrial, commercial agricultural or otherwise in the said State, after giving one month’s notice of its intention of so doing by notification in the Official Gazette. The Commercial establishments are also covered under this section including, school, colleges, Hospitals, Contractors.
Now a day, it has been made mandatory to the employer to get covered his establishment if is deploying with 10 or more than 10 employees in this establishment whether the employees are directly employed or employed through a third party including contractors. Hence it is clear that the provisions of the Act will be applicable upon all such establishments wherein 10 and more employees are employed irrespective of their wages, designation. Hence you Company is legally bond to make compliance under the ESI Act and further bond to deduct ESI contribution pursuance to be a contributory scheme on the part of employees as well as employer.
Applicability of EPF and MP Act, 1952.
section 1 (3) of the EPF and MP Act, 1952 make it compulsory to all of the employers to cover his/her establishment if he/she is deploying/employing with 20 number of employees in his/her establishment irrespective of the wage and other employment conditions. All of the employees including regular, casual, temporary, badli, probationers, permanent as well as contractual employees will be counted for applicability of the act.
Similarly section 1 (4) of the Act, make provisions for coverage of the establishment voluntarily even in case of lesser employees as prescribed in section 1 (3) of the Act subject to the condition there should be consent of both the parties employees as well as employer, on their consent the act shall be applicable upon lesser number of employees.
If any employer who is employing with number of person exceeding or equivalent to the limit as prescribed under the respective shall be prosecuted in accordance with the provisions madeout in the acts'.
Regards
R B Rao
Advocate
From India, Gurugram
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As such you are deploying with 28 number of employees, i have gone through all of the posts, i would like to draw the attention of all of the readers to the following provisions separately for ESI as well for Provident Fund.
Applicability of the ESI Act, 1948
Pursuance to the Employees' State Insurance Act, 1948, there are two sections stipulated in the Act are section 1(3) which is concerned with the applicability of the act upon factories where any type of manufacturing activity is carried out.
the other section is section 1 (5) which empower the Central Government to extend all or any of the provisions of the Act to any other establishment or class of establishments, industrial, commercial agricultural or otherwise in the said State, after giving one month’s notice of its intention of so doing by notification in the Official Gazette. The Commercial establishments are also covered under this section including, school, colleges, Hospitals, Contractors.
Now a day, it has been made mandatory to the employer to get covered his establishment if is deploying with 10 or more than 10 employees in this establishment whether the employees are directly employed or employed through a third party including contractors. Hence it is clear that the provisions of the Act will be applicable upon all such establishments wherein 10 and more employees are employed irrespective of their wages, designation. Hence you Company is legally bond to make compliance under the ESI Act and further bond to deduct ESI contribution pursuance to be a contributory scheme on the part of employees as well as employer.
Applicability of EPF and MP Act, 1952.
section 1 (3) of the EPF and MP Act, 1952 make it compulsory to all of the employers to cover his/her establishment if he/she is deploying/employing with 20 number of employees in his/her establishment irrespective of the wage and other employment conditions. All of the employees including regular, casual, temporary, badli, probationers, permanent as well as contractual employees will be counted for applicability of the act.
Similarly section 1 (4) of the Act, make provisions for coverage of the establishment voluntarily even in case of lesser employees as prescribed in section 1 (3) of the Act subject to the condition there should be consent of both the parties employees as well as employer, on their consent the act shall be applicable upon lesser number of employees.
If any employer who is employing with number of person exceeding or equivalent to the limit as prescribed under the respective shall be prosecuted in accordance with the provisions madeout in the acts'.
Regards
R B Rao
Advocate
From India, Gurugram
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(Fact Checked)-The user's reply contains accurate information regarding the applicability of the ESI Act, 1948, and the EPF and MP Act, 1952, based on the number of employees mentioned in the original post. The details provided are in line with the laws and regulations. (1 Acknowledge point)
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PF for foreign employees 1.10.08.pdf
PF & ESI.zip
CiteHR.AI
(Fact Checked)-The information provided in the user reply is partially correct, but there are some inaccuracies regarding the applicability of PF/ESI registration requirements. Kindly see the amendment below for the accurate details. (1 Acknowledge point)