Madhu, harsh
To the best of my knowledge, neither PF nor ESIC act actually has any provision making the principal employer liable for statutory dues of contract worker, out worker or any factory doing job work. The provision making principal employer liable for statutory dues of contract employees comes only in the contract labour act.
In view of the above, you need to see whether they are contract workers under the act or not. If not, then there is no law requiring the outsourcing factory to ensure statutory compliance of the outsourced company.
Please let me know if you know of any provision other than CLRA that makes this mandatory.
From India, Mumbai
2392To the best of my knowledge, neither PF nor ESIC act actually has any provision making the principal employer liable for statutory dues of contract worker, out worker or any factory doing job work. The provision making principal employer liable for statutory dues of contract employees comes only in the contract labour act.
In view of the above, you need to see whether they are contract workers under the act or not. If not, then there is no law requiring the outsourcing factory to ensure statutory compliance of the outsourced company.
Please let me know if you know of any provision other than CLRA that makes this mandatory.
From India, Mumbai
1. Dear Shri Saswata Banerjee ji, kindly see sections 39, to 41 of ESI Act, 1948 and section 8A of EPF & MPs Act, 1952. which are self explanatory.
2. Further both ESI Act, 1948 as well as EPF & MPs Act, 1952 are self - contained codes and do not depend in any manner on CLRA. In ESI Act the words "contractor" has not been used. In ESI Act, 1948 some definitions can be referred only from the Industrial Disputes Act, 1948 ( ref section 2(24).
3. So far as provisions of ESI Act, 1948 and EPF & MPs Act, 1952 are concerned, the provisions of CLRA are neither applicable, nor the same have any relevancy because the provisions of CLRA are applicable in respect of those functions/subjects as mentioned in its preamble. This is the matter of interpretation and I think, you can find various judgments of Hon'ble courts on interpretation of relevancy of provisions of other Acts.
From India, Noida
2. Further both ESI Act, 1948 as well as EPF & MPs Act, 1952 are self - contained codes and do not depend in any manner on CLRA. In ESI Act the words "contractor" has not been used. In ESI Act, 1948 some definitions can be referred only from the Industrial Disputes Act, 1948 ( ref section 2(24).
3. So far as provisions of ESI Act, 1948 and EPF & MPs Act, 1952 are concerned, the provisions of CLRA are neither applicable, nor the same have any relevancy because the provisions of CLRA are applicable in respect of those functions/subjects as mentioned in its preamble. This is the matter of interpretation and I think, you can find various judgments of Hon'ble courts on interpretation of relevancy of provisions of other Acts.
From India, Noida
Thanks harsh
I will review the sections you have mentioned
Ofcourse I have seen the ESIC circular on contractors attached by Madhu in the last page
Thanks for taking the trouble to identify the sections for me
From India, Mumbai
I will review the sections you have mentioned
Ofcourse I have seen the ESIC circular on contractors attached by Madhu in the last page
Thanks for taking the trouble to identify the sections for me
From India, Mumbai
1. Sh. Saswata Banerjee ji, thanks for conveying your thanks to me. I am a retired officer from ESIC and is also a law graduate and has obtained Post Graduate Diploma in Labour Laws. I strongly feel that whatsoever we write in this forum it must be to the point and legally correct and I feel that I am making my efforts in the right direction. Many times I also seek guidance from seniors like Madhu ji.
2. I also feel that Advisors and Consultants, who are working in the field are having vast experience and can serve better to the poor workers/employees by providing social security through their connections and clients by correct interpretation of various labour laws and procedures enacted therein.
From India, Noida
2. I also feel that Advisors and Consultants, who are working in the field are having vast experience and can serve better to the poor workers/employees by providing social security through their connections and clients by correct interpretation of various labour laws and procedures enacted therein.
From India, Noida
Thanks Madhu ji, Harsh ji, Saswata ji & Sreeganesh ji for the inputs.
I have one more doubt with regards to the thread. In that case, on what basis / terminologies the bill should be obtained from the supplier. Because if the supplier has mentioned the bill as "Labour Charges", will the principal employer is liable for the statutory norms of PF & ESI.?
Pl clarify.
Regards,
KPV
From India, Chennai
I have one more doubt with regards to the thread. In that case, on what basis / terminologies the bill should be obtained from the supplier. Because if the supplier has mentioned the bill as "Labour Charges", will the principal employer is liable for the statutory norms of PF & ESI.?
Pl clarify.
Regards,
KPV
From India, Chennai
It would be better for him to give you a bill for job work or processing charges instead of labour charges.
For labour charges, you will have an issue with service tax and reverse charges.
That finally has an impact on your cost, in terms of available or disallowed can at credit and vat input credits. Please speak to your auditor as he can comment based on all parameters, as to which is more cost effective for you.
From India, Mumbai
For labour charges, you will have an issue with service tax and reverse charges.
That finally has an impact on your cost, in terms of available or disallowed can at credit and vat input credits. Please speak to your auditor as he can comment based on all parameters, as to which is more cost effective for you.
From India, Mumbai
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