STRICTLY STATUTES
A Newsletter from ADP India
EDITOR’S NOTE
OCTOBER
2013
TABLE OF CONTENTS
Pages
Hello Readers,
September 2013 saw that the courts across the country
come up with some significant and interesting rulings.
The Bombay High Court has made the employer liable to pay
the ESI contribution to employees, irrespective of their
engagement whether on contract basis or otherwise.
India has the largest workforce employed in un-organized
sector, mostly as daily wage workers and not covered by PF
and ESI. This important ruling by Bombay High Court will
ensure that contract workers, whether they are daily wage
workers, coolies, loaders or un-loaders are now protected.
Small steps such as these are in the right direction and will
play a large role in mobilising the workforce movement
towards organised sector.
In the PF space, EPFO, has published a circular quoting a
recent judgment, which states that canteen allowance will be
included in the PF wage calculation and has instructed its
field staff to refer to this ruling for adjudicating similar issues
and for defending similar cases at EPFAT and high courts
This issue covers these developments and judgments in
detail, along with other interesting information in the statutory
compliance space. We hope you enjoy reading this issue
and find it useful.
Please do share your inputs / suggestions and help us to
enrich the newsletter content. You may write to us at
contactadp@adp.com
Regards,
Editor
Compliance calendar for
Sep 13 (Time line for Oct 13)
02
ADP trains Entrepreneurs
on Statutory
Compliance…
03
EPFO Schemes excluded
from implementation of
direct benefit transfer…
04
Employer is liable to pay
ESI contribution for
contract workers …
05
Partners are not to be
included for coverage
under PF Act…
05
No accident
compensation for normal
death during employment
06
Page 02
STRICTLY STATUTES
A Newsletter from ADP India
Compliance Calendar for October 2013
Due Date
Scope
Due Under
Mode
Professional Tax Remittances
10th Oct 13
Andhra Pradesh & Madhya Pradesh
State-wise regulations
By Challan
15th Oct 13
Gujarat
Gujarat PT regulations
By Challan
20th Oct 13
Karnataka
Karnataka PT regulations
By Challan
21st Oct 13
West Bengal
WB PT regulations
By Challan
Oct 13
30thth Aug
Maharashtra, Assam & Orissa
State-wise
State Wise regulations
regulations
By Challan
Kerala
Kerala State Labour
Welfare Fund
By Challan
15th Oct 13
Central - Remittance of Contribution
EPF & MP Act 1952
By Challan
25th Oct 13
Central - International worker with wages
and nationality
EPF & MP Act 1952
Statement in 7 I W
Main Code & Sub Codes - Remittance of
Contribution
ESIC Act 1948
By Challan
Labour Welfare Fund Remittances
20th Oct 13
PF
ESI
21st Oct 13
Employment Exchange (Compulsory Notification of Vacancies) Act, 1959
15th Oct 13
Form ER I Strength Returns
ESIC Act 1948
By Challan
Factories Act
31st Oct 13
Renewal of Factory License
As submission
During
month
Safety Committee Meeting
As meeting
During
month
Canteen Committee Meeting
As meeting
Page 03
STRICTLY STATUTES
Flash News
ADP partnered with
the Micro, Small and
Medium Enterprises
Development Institute
and trains Entrepreneurs
on Statutory Compliance
A Newsletter from ADP India
ADP partnered with MSME DI, Chennai, a Government of India
initiative and trained 100 plus entrepreneurs on Statutory
Compliance, which is mandatory for every organisation. Over
hundred entrepreneurs from across industries ranging from
Manufacturing, IT, ITeS, Educational Institutes to Staffing
Companies and Service Organisations attended this two day
training program held recently at Chennai.
Officials from ADP India trained the participants on various State
and Central Labour Legislations that are mandatory for every
organization to follow. Participants were exposed to the complex
maze of various local, regional and central acts and rules that are
related to employer and employee compliance, which every
employer is expected to comply with.
The participants benefitted from this two day session, where ADP
officials shared their expertise in an interactive format and
trained them on running a 100% compliant organisation.
Page 04
STRICTLY STATUTES
A Newsletter from ADP India
Circulars
Canteen allowance is now part of basic wages for PF deduction
Canteen allowance, paid by the employer to his employees is
considered to be part of basic wages, and is required to be taken
into account while computing the provident fund (PF)
contribution, the Delhi High Court has stated in a recent ruling.
The EPFO has published this order in its Web site, as a
reference to its field staff, for adjudicating similar issues and for
defending similar cases at EPFAT and high courts.
The court delivered its recent judgement on a petition filed by
Whirlpool Of India Ltd., on July 22 against an order of Regional
Provident Fund Commissioner asking the company to pay PF
contribution on canteen allowance provided to its workers.
The court observed that the employer is splitting wages to reduce their PF and other tax liabilities, which is an
anti-worker movement and against the social security scheme. The canteen allowance is part of basic wages
itself and will be considered for PF computation.
However, it is to be noted that the “Food and Consistence Allowances”, which is provided by the employer will
continue to be treated separately and will not be included for PF calculation.
EPFO Schemes excluded from the list of schemes identified for the implementation of
direct benefit transfer
With reference to the Ministry of Labour letter No. Z.25025/7/2012.SS.II, dated 27 May 2013, it should be
understood that the schemes of EPFO have been excluded from the list of schemes of the ministry identified for
the implementation of direct benefit transfer to the beneficiaries.
http://www.moia.gov.in/services
.aspx?ID1=285&id=m4&idp=81&
mainid=73
Page 05
STRICTLY STATUTES
SIGNIFICANT RECENT JUDGMENTS
EMPLOYER IS LIABLE TO PAY ESI
CONTRIBUTION FOR CONTRACT
WORKERS
In a case (Appeal under ESI No. 2/2007, D/-2-5-2013)
between Regional Director, ESI Corporation, Goa vs.
Farmacia Ananta, Goa, the Bombay High Court has
ruled that when the employer is unable to give details
of labour charges and cost of material, the ESI
Authority could fairly determine contribution at the rate
of 25% of total amount as notified vide memorandum
dated 16.11.1981 by the ESI Corporation.
PARTNERS ARE NOT TO BE
INCLUDED IN A FIRM FOR COVERAGE
UNDER PROVIDENT FUND ACT
A Newsletter from ADP India
When the activity of loading and unloading is a regular
activity in the regular course of business, under the
supervision and control of the employer, the
employees like coolies / hamalies employed through
contractors or directly by the employer, to carry out
the job, will be employees under section 2 (9) of the
Employees’ State Insurance Act, 1948.
The employer is liable to pay the ESI contribution,
irrespective of their engagement on contract basis or
otherwise, if they have to perform work of regular
nature under the supervision and control of the
employer.
In a recent judgment (C. Misc. W.P. No.
2922/2000,D/-19-10-2012), Allahabad High Court has
pronounced that partners are not to be included in a
firm for coverage under Employees’ Provident Funds
& Miscellaneous Provisions Act, 1952 – Section
1(3)(b). According to this ruling that was passed in the
case of M/s. Sachan Nursing Home & Anr. Vs. Reg.
P.F. Commissioner, Bhavishya Nidhi Bhavan,
Varanasai & Anr., the partners of an establishment
will not be included in a firm for coverage under the
EPF & MP Act, since the partners have different status
than the employees as held by the Supreme Court.
The High Court quashed the decision of EPF
Authorities and the ruling further states that the
partners of a firm cannot be treated as employees as
per Employees’ Provident Funds & Miscellaneous
Provisions Act, 1952 – Section 2 (f), to be covered
under the EPF & MP Act and hence the coverage of
Nursing Home stating that it was employees in
addition to 3 doctors who were partners as such.
Page 06
STRICTLY STATUTES
A Newsletter from ADP India
NORMAL DEATH EVEN DURING THE COURSE OF EMPLOYMENT WILL NOT ATTRACT
ACCIDENT COMPENSATION
The Gauhati High Court, in a case (M.F.A. (WC) No.
16/2002. D/-18-12-2012) between Santi Rani
Debnath and Another vs. Anil Chandra Saha and
Others, has ruled that the normal death even
during the course of employment will not attract
accident compensation. In its ruling the court has
stated that normal death by bodily ailment even in
course of employment cannot attract the liability
of employer under the act.
Only an unlooked mishap or an untoward event,
which is not expected or designed is to be covered
under “accident” as per judicial pronouncement.
Death caused due to illness, not consequential or
connected with discharge of duty, cannot be
termed as accidental death. If the claimant fails
to establish that the injury suffered by him is due
to accident arising out of and in the course of his
employment, the employer is not liable to pay
compensation under the Workmens’ / Employees’
Compensation Act - 1923.
An injury under section 3(1) of the Employees’
Compensation Act is a wide term than bodily
injury or actual physical hurt and it may include a
disease also, when a disease is contracted as a
result of passage of virus i.e. consequential result
of the injury.
Page 07
STRICTLY STATUTES
ADP Global
A Newsletter from ADP India
ADP India
With more than $11 billion in revenues and more than
60 years of experience, ADP® (NASDAQ: ADP)
serves approximately 620,000 clients in more than
125 countries. As one of the world's largest providers
of business outsourcing and human capital
management solutions, ADP offers a wide range of
human resource, payroll, talent management, tax and
benefits administration solutions from a single source,
and helps clients comply with regulatory and
legislative changes, such as the Affordable Care Act
(ACA). ADP's easy-to-use solutions for employers
provide superior value to companies of all types and
sizes. ADP is also a leading provider of integrated
computing solutions to auto, truck, motorcycle,
marine, recreational vehicle, and heavy equipment
dealers throughout the world.
ADP India offers a wide range of payroll, statutory and
HR solutions, both as managed services and on
cloud. ADP partners with organisations to handle their
complex, yet critical functions of payroll, statutory
compliance and HR administration tasks effectively.
ADP’s proven Managed and On Cloud Payroll,
Statutory Compliance, Leave Management and Time
& Attendance solutions are designed to address the
scalable and dynamic needs of an organisation. ADP
partners with small, mid-sized and large enterprises
to streamline their Payroll, Compliance and HR
administration processes.
ADP India is an ISO 9001:2008 and ISO 27001:2005
certified and SSAE 16 Type II compliant company and
serves clients from all industries across the country.
For more information about ADP India or to contact a
local ADP sales office, reach us at 1-800-4190-237 or
visit the company's Web site at www.adp.in
Get the ADP expertise working for you.
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ADP India
Thamarai Tech Park,
S.P. Plot No. 16 to 20 & 20A
Thiru Vi Ka Industrial Est ate,
Inner Ring Road, Guindy,
Chennai - 600032.
Phone
1-800-4190-237
Email
contactadp@adp.com