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Jayanta Bandyopadhyay   05 May 2022

Applicability of pf,esi to interior design,plumbing,civil work

We place PO on Manpower supply ( as per trade licence) agency to carry out civil ,painting,plumbing,sanitary works etc at office Guest House. Trade Licence do not cover all these works and they do not have PF,ESI,EDLI for their employees. HR is pushing me not to press for all these requirements. I would seek your kind advisory about applicability of PF,ESI EDLI for 2 months duration jobs Worth Rs.10 Lakhs. Please also mention section, case laws if any. Rgds,



Quick Summary
This discussion explores the applicability of Provident Fund (PF), Employees' State Insurance (ESI), and EDLI to short-term contracts for interior design, plumbing, and civil works, particularly when engaging manpower supply agencies. While HR may advise against strict adherence for temporary roles, legal precedents suggest that PF/ESI coverage is generally required for workers engaged in activities integral to the establishment's operations, regardless of contract duration. However, if the contracted work is entirely unconnected to the core business, there might be grounds for exemption, though potential legal complications and worker complaints should be carefully considered.

 2 Replies

Rama chary Rachakonda (Secunderabad/Telangana state Highcourt practice watsapp no.9989324294 )     05 May 2022

ESI and EPF are applicable to all casual and temporary workers who are engaged to work within the premises of the factory/ establishment covered by ESI or PF, as the case may be. However, there are certain judgement which says that when a workman is engaged for any work not connected with the activity of the establishment, he need not be covered by ESI. The Kerala High Court in Regional Director ESI Corporation Vs P R Narahari Rao (1986 Lab I C 1981) has observed that there is a distinction between "employment" and "engagement" and if a person is casually engaged for a process unconnected with the operations of the establishment, or some work which does not form the integral part of such operations, he may not be an employee since there would be no employer employee relationship between them. On the other hand, if a person is employed for a very short period of time but in connection with the processes or operations which are integral and connected with the business of the establishment,he is an employee entitled to coverage under the Act. The Punjab and Haryana High Court in ESI Corporation Vs. Malhotra & Co, Chandigarh (1981 Lab I.C 475) has also given a similar verdict. Therefore, if the painting work is not the main business of the establishment, you may not contribute to ESI/ EPF saying that the work to which he is 'engaged' is not the integral process of your business. read more at: https://www.citehr.com/337045-pf-esic-work-done-contract-basis.html

Jayanta Bandyopadhyay   05 May 2022

Sir

In this case, we are giving works contract for civil work at Guest House, to serve visiting officials. Contractor is basically man power supply agency per trade licence. Can we waive applicability of pf,esi,edli? If any accident happens in our GH, Police will ultimately ask appointing authority. Any worker may complain to PF Authority about no pf benefits. Then we will be in soup. As per law, for any single day work, pf is must,if one has more than 10 workers. Kindly guide


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