How many employees must a private limited company have to start the application of all labor laws? If it's a startup, can it keep resources/talent as consultants until revenues are stable and the decision to form a larger outfit seems feasible?
From India, Kolkata
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From India, Kolkata
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Seema ji, If your company is commercial establuishment, then the Shop Act, Industrial Disputes Act, Minimum Wages Act, Payment if Wages Act etc will apply from day one. S. K. Mittal 9319956443
From India, Faridabad
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59From India, Faridabad
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Dear all,
I am trying to create a WhatsApp group where everyone can share their knowledge and experience. Kindly help me in creating such a group that can help beginners to learn.
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Regards,
Suraj
From India, Delhi
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I am trying to create a WhatsApp group where everyone can share their knowledge and experience. Kindly help me in creating such a group that can help beginners to learn.
Link to join the group: [https://chat.whatsapp.com/CH3AUnGToKnJdIsY62IrIe](https://chat.whatsapp.com/CH3AUnGToKnJdIsY62IrIe).
Regards,
Suraj
From India, Delhi
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Private limited company is an organization formed under the Companies Act, 1956. It is therefore registered under ROC, where only the core management, that is the directors, are registered.
As for the minimum number of employees required to comply with labor and social security laws, it is as per the Shops and Establishments Act applicable in your state if the company is a commercial establishment, or as per the Factories Act if it's a factory. However, a minimum of 10 employees are required for EPF and 20 for ESIC.
In addition, the company has to abide by all applicable labor acts such as the Minimum Wages Act, Payment of Wages Act, Equal Remuneration Act, Payment of Bonus Act, Payment of Gratuity Act, and Maternity Act for female employees, among others. All compliance requires fulfillment of certain conditions and terms of employment given therein.
I also suggest referring to the latest four labor codes likely to be implemented in April 2021.
From India, Vadodara
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As for the minimum number of employees required to comply with labor and social security laws, it is as per the Shops and Establishments Act applicable in your state if the company is a commercial establishment, or as per the Factories Act if it's a factory. However, a minimum of 10 employees are required for EPF and 20 for ESIC.
In addition, the company has to abide by all applicable labor acts such as the Minimum Wages Act, Payment of Wages Act, Equal Remuneration Act, Payment of Bonus Act, Payment of Gratuity Act, and Maternity Act for female employees, among others. All compliance requires fulfillment of certain conditions and terms of employment given therein.
I also suggest referring to the latest four labor codes likely to be implemented in April 2021.
From India, Vadodara
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Dear Seema,
I would like to request you to go through the definition of the term 'industry' under section 2(j) of the ID Act, 1947. There is no stipulation about the minimum or maximum number of employees in the Act other than certain employment contingencies such as layoff, retrenchment, closure. Therefore, if there is a single employee and the purpose of the entity is to satisfy human needs or wants, then it becomes an industry.
It follows that the correlation between the number of employees and the industry comes into play only with reference to the nature of the prime activity of the industry and the application of certain conditions of employment such as wages, bonus, gratuity, social security, etc. For example, if the primary or principal activity is manufacturing, it is a factory falling under the Factories Act, 1948; if it involves the raising of certain specified crops in an integrated manner, it is a plantation falling under the Plantations Labour Act, 1951. Similarly, the application of labor laws relating to different conditions of employment, as pointed out by Mr. Majumdar, involves the nature of statutory restrictions and the complexity of application, requiring the stipulation of a certain minimum number of employees for the sake of ease of systematic compliance.
Apart from this, the nature of the constitution of the entity, such as a Limited Company, LLP, Sole Proprietorship, Trust, or Society registered under the Societies Registration Act, generally has no relevance in the application aspect of labor laws.
From India, Salem
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I would like to request you to go through the definition of the term 'industry' under section 2(j) of the ID Act, 1947. There is no stipulation about the minimum or maximum number of employees in the Act other than certain employment contingencies such as layoff, retrenchment, closure. Therefore, if there is a single employee and the purpose of the entity is to satisfy human needs or wants, then it becomes an industry.
It follows that the correlation between the number of employees and the industry comes into play only with reference to the nature of the prime activity of the industry and the application of certain conditions of employment such as wages, bonus, gratuity, social security, etc. For example, if the primary or principal activity is manufacturing, it is a factory falling under the Factories Act, 1948; if it involves the raising of certain specified crops in an integrated manner, it is a plantation falling under the Plantations Labour Act, 1951. Similarly, the application of labor laws relating to different conditions of employment, as pointed out by Mr. Majumdar, involves the nature of statutory restrictions and the complexity of application, requiring the stipulation of a certain minimum number of employees for the sake of ease of systematic compliance.
Apart from this, the nature of the constitution of the entity, such as a Limited Company, LLP, Sole Proprietorship, Trust, or Society registered under the Societies Registration Act, generally has no relevance in the application aspect of labor laws.
From India, Salem
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