Hi, we need some guidance. Our seasonal business runs from September to May, and we hire unskilled workers from the local market based on our work requirements. These workers typically work with us for 1 to 2 days, or up to a week in a month, but don't stay with us long term. We hire new unskilled workers every day based on our work requirements.
What are the compliances for PF and ESIC in this scenario? The workers usually don't agree to PF and ESIC deductions and often don't carry ID proof or bank account details. Are PF and ESIC applicable to unskilled workers hired from the local market who don't usually have ID or bank account details? We are located in Bengaluru, India.
From India, Bengaluru
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What are the compliances for PF and ESIC in this scenario? The workers usually don't agree to PF and ESIC deductions and often don't carry ID proof or bank account details. Are PF and ESIC applicable to unskilled workers hired from the local market who don't usually have ID or bank account details? We are located in Bengaluru, India.
From India, Bengaluru
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Yes, as per the Indian Employees Provident Fund (EPF) and Miscellaneous Provisions Act, 1952, and Employees' State Insurance (ESI) Act, 1948, both EPF and ESIC are applicable to all employees, including temporary or seasonal workers, irrespective of their skill level.
However, it's important to note that:
- For EPF, it applies to establishments employing 20 or more persons and certain organizations defined under section 1(5) of the Act, even if they employ less than 20 persons each.
- For ESIC, it applies to non-seasonal factories employing 10 or more persons.
The lack of ID proof or bank account details can pose a challenge. However, it's advisable to help these workers obtain at least a basic ID proof and a zero-balance bank account under the Pradhan Mantri Jan Dhan Yojana (PMJDY) scheme. This would aid in compliance with statutory requirements.
Here are the steps you might follow to ensure compliance:
1. Educate the workers about the benefits of EPF and ESIC, which include financial security and medical benefits.
2. Assist them in obtaining necessary ID proof. Aadhar card is the most commonly accepted form of ID.
3. Help them open a bank account under PMJDY or other similar schemes. Many banks offer doorstep services for this.
4. Deduct the appropriate EPF and ESIC amounts from their wages and deposit it to the respective authorities on their behalf.
Remember, non-compliance can result in penalties and legal action. It's always advisable to consult with a labor law expert or an HR consultant locally to ensure the best practices are being followed.
From India, Gurugram
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28However, it's important to note that:
- For EPF, it applies to establishments employing 20 or more persons and certain organizations defined under section 1(5) of the Act, even if they employ less than 20 persons each.
- For ESIC, it applies to non-seasonal factories employing 10 or more persons.
The lack of ID proof or bank account details can pose a challenge. However, it's advisable to help these workers obtain at least a basic ID proof and a zero-balance bank account under the Pradhan Mantri Jan Dhan Yojana (PMJDY) scheme. This would aid in compliance with statutory requirements.
Here are the steps you might follow to ensure compliance:
1. Educate the workers about the benefits of EPF and ESIC, which include financial security and medical benefits.
2. Assist them in obtaining necessary ID proof. Aadhar card is the most commonly accepted form of ID.
3. Help them open a bank account under PMJDY or other similar schemes. Many banks offer doorstep services for this.
4. Deduct the appropriate EPF and ESIC amounts from their wages and deposit it to the respective authorities on their behalf.
Remember, non-compliance can result in penalties and legal action. It's always advisable to consult with a labor law expert or an HR consultant locally to ensure the best practices are being followed.
From India, Gurugram
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PF ESIC.xls