ESI
Reshma K
(Querist) 04 February 2010
This query is : Resolved
Does the ESI act apply to software companies. Generally it is said that the "karnataka shops and establishment act" applies to these companies.
Are the employees of these software like companies "workman' for the purposes of various labour laws. Do the labour laws like Factories Act, ESI, MWA, Payment of Bonus Act apply to them
B K Raghavendra Rao
(Expert) 04 February 2010
If it is a factory employing ten or more persons and using power or employing twenty or more persons and not using power, if an employer - employee relationship exists and if the employee is below the rank of supervisor and drawing a salary of less than Rs. 3,500 per month, then the labour laws apply to him. Otherwise not. In Karnataka, "Karnataka Shops and Establishments Act" applies to these software companies because no employee would be drawing a salary of not less than Rs. 3,500 per month.
However, the establishments are covered under ESI Act. Either they should subscribe to ESI or have their own health insurance scheme and seek exemption from ESI Act.
A.R.KUPPUSAMI
(Expert) 05 February 2010
A factory or Establishment runs with power and ten employees or without power engaged with twenty and above employees are coverable under ESI Act.
If the employees are drawing more than the limit of Rs.10000/- salary they are not coverable
