ESI Annnoucements
31/07/2011
ESI contribution on outside job works
Judgments in this regard provide relief to employers who outsource work to outside establishments.
As mentioned above, the Supreme Court has upheld a verdict of the Karnataka High Court in the ESIC v/s JMD Fashions – MFA 1089/2001 case, that outside establishments are not immediate employers under Section 2(13) of the ESI Act, and so, if jobs are done outside by contract labour, and where there is no element of supervision by the principal employers on such contract labour, the principal labour will not be liable for ESI contribution on job work charges paid to such contract labour.