MAR 2015 PAGES Hello Readers, Compliance Calendar for Mar 2015 02 The Compliance Calendar for March 2015 includes remittances for PF, ESI, Professional Tax and Labour Welfare Fund. Important Judgments In important judgments, the Honourable Karnataka High Court has ruled that an employee, after acceptance of resignation and his payment, can't challenge it. An employee, after acceptance of resignation and his payment, can't challenge it 03 It has also held that a school, employing 20 or more employees, is covered under the PF Act. The Honourable Delhi High Court has pronounced that non-reporting for duty at the place of transfer would be treated as abandonment of service. The Honourable Bombay High Court has held that the major records to establish relationship of employeremployee are appointment letter, identity card issued, pay slips, etc. The Honourable Delhi High Court has ruled that for coverage of an establishment under the Provident Fund Act, regular, temporary and casual employees are counted. The Honourable Supreme Court of India has pronounced that the amount may be small or large; it is the act of misappropriation that is relevant. The Honourable Kerala High Court has held that regulations framed by the employer cannot supersede the payment of Gratuity Act, 1972. The Honourable Punjab & Haryana High Court has ruled that on infringement of standing orders or Industrial Disputes Act, the jurisdiction of civil court is barred. A school, employing 20 or more employees, is covered under PF Act 03 04 In news to note, a revision in ESIC wages ceiling is planned. An amendment to the increase in working hours is to be revisited. Under the Apprentice Protsahan Yojna launched in October last year, 20 lakh apprentices are to be engaged. Employment exchanges will no more be mere registration centers but will be transformed into national career council centers. The Employees' Provident Funds (Fifth Amendment) Scheme 2014 shall come into force from 1st April 2011. The Labour Laws (exemption from furnishing returns and maintaining registers by certain establishments) Amendment Act, 2014 shall come into force by notification in the official gazette. By a circular dated 25.2.2015, all employers should submit return in Form 5A of the Employees' Provident Fund Scheme. Regulations framed by the employer cannot supersede the Payment of Gratuity Act, 1972 We hope you find the contents of this newsletter relevant and useful. We welcome your suggestions and inputs for enriching the content of this newsletter. Please write to [email protected] 20 lakh apprentices to be engaged Non-reporting for duty at the place of transfer would be treated as abandonment of service Major ingredients to establish relationship of employer-employee are appointment letter, etc. 04 For Coverage of an establishment under Provident Fund Act, the regular, temporary and casual employees are accounted 05 The amount may be small or large; it is the act of misappropriation that is relevant 05 06 06 On infringement of standing orders or Industrial Disputes Act the jurisdiction of civil court is barred News to note ESIC wages ceiling revision planned Working hours to be revisited Employment exchanges will no more be mere registration centers The Employees' Provident Funds (Fifth Amendment) Scheme 2014 The Labour Laws (Exemption from Furnishing Returns and Maintaining Registers by Certain Establishments) Amendment Act, 2014 All Employers to submit return in Form 5A of the Employees' Provident Fund Scheme 07 07 07 07 08 08 08 PAGE 02 Compliance Calendar for the month of Mar 2015 Activity Due Date Due Under Mode Professional Tax - States - Remittances 10th Mar 15 Andhra Pradesh & Madhya Pradesh State wise regulations By Challan 15th Mar 15 Gujarat Gujarat PT regulations By Challan 20th Mar 15 Karnataka Karnataka PT regulations By Challan 21st Mar 15 West Bengal West Bengal PT regulations By Challan 28th Mar 15 Assam & Orissa State wise regulations By Challan 28th Mar 15 Maharashtra Maharashtra PT Regulation Online Labour Welfare Fund Remittances 20th Mar 15 Kerala Kerala State Labour Welfare Fund By Challan PF Central 15th Mar 15 Remittance of Contribution EPF & MP Act 1952 By Challan 15th Mar 15 International worker with wages and Nationality EPF & MP Act 1952 Statement in IW 1 ESI Central 21st Mar 15 Remittance of Contribution (Main code and Sub Codes) ESIC Act 1948 By Challan PAGE 03 AN EMPLOYEE, AFTER ACCEPTANCE OF RESIGNATION AND HIS PAYMENT, CAN'T CHALLENGE IT In a case of M.Babu s/o Muniswamy vs. Management of Press Com Products, rep. by its Proprietor, the Hon'ble Karnataka High Court through Hon'ble Justice Mr.Ram Mohan Reddy pronounced that ¡A plea of the workman that his services have been terminated illegally, by raising an industrial dispute after about 8 months is not maintainable when he was issued letter of acceptance of his resignation at the relevant time, he was paid Rs.100000 towards his full and final dues through account payee cheques which he had encashed without protest. ¡When letter of acceptance of resignation issued by the employer is received by the workman without any protest and full and final payment received by the workman through account-payee cheques is also encashed, his plea of the workman that is resignation was obtained by force by his employer is not maintainable. ¡Writ court under Article 227 of the Constitution of India is having only supervisory jurisdiction, not requiring hearing of lengthy arguments or re-appreciation of evidence if finding are not shown to be perverse or illegal. A SCHOOL, EMPLOYING 20 OR MORE EMPLOYEES, IS COVERED UNDER PF ACT In an extraordinary case of Sri Guru Teg Bahadur Public School vs. Employees' Provident Fund Organisation and Ors, the Hon'ble Delhi High Court through Hon'ble Justice Mr.Suresh Kait pronounced that ¡When an establishment/school has 20 or more employees, the provisions of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 would be applicable. ¡If the employer fails to produce documentary evidence to prove his case that his establishment/school has less than 20 employees before the Commissioner and/or Appellate Authority under the Employees' Provident Fund and Miscellaneous Provisions Act, 1952, the provisions of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 would be applicable. PAGE 04 NON-REPORTING FOR DUTY AT THE PLACE OF TRANSFER WOULD BE TREATED AS ABANDONMENT OF SERVICE In a case of Competent Security Service vs. Government of NCT of Delhi & Ors, Delhi High Court through Hon'ble Justice Mr.Suresh Kait, pronounced that ¡When post is transferable but the workman does not report for duty at the place of his transfer, awarding reinstatement by the labour court to such a workman on raising an industrial dispute later on by him, is not justified. ¡Not reporting for duty at the place of transfer, as per terms and conditions of appointment letter, without any justified explanation, thereby remaining unauthorisedly absent would be treated as abandonment of service on the part of the employee. ¡Transfer of an employee is justified when his post is transferable on the basis of terms and conditions of his appointment letter. MAJOR INGREDIENTS TO ESTABLISH RELATIONSHIP OF EMPLOYER-EMPLOYEE ARE APPOINTMENT LETTER, ETC. In a case of M/s. Plaggio Vehicles Pvt Ltd vs. Mr.Jagannath Vithal Jagtap & Anr, the Hon'ble Bombay High Court through Hon'ble Justice Smt. R.P Sondur Baldota pronounced that ¡When employer-employee relationship is not proved on record of the court file, awarding reinstatement by the labour court to the workman is not justified. ¡Major ingredients to establish relationship of employer-employee are appointment letter, attendance and payment of wage records, leave records, identity card issued by the employer, pay/wages slips issued by the employer and any other letter/communication of the employer in respect of the employee. ¡Documents like gate pass by itself cannot be an incident of service sufficient to establish employer-employee relationship. ¡Medical treatment given to the workman by the doctor of the company can hardly be said to be an incident of service since it may be given on humanitarian ground. PAGE 05 FOR COVERAGE OF AN ESTABLISHMENT UNDER PROVIDENT FUND ACT, THE REGULAR, TEMPORARY AND CASUAL EMPLOYEES ARE ACCOUNTED In a case of M/s Polythene Bag Factory vs. Assistant Provident Fund Commissioner, the Hon'ble Delhi High Court through the verdict by Hon'ble Justice Mr.Suresh Kait pronounced that ¡When the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 is made applicable it would continue to be effective notwithstanding the fall of number of employees below 20 as per section 1(5) of the Act. ¡The Employees' Provident Fund and Miscellaneous Provisions Act, 1952 becomes applicable to an establishment, when the strength of its employees touches 20 or more. ¡There is no distinction as to whether an employee is regular, temporary, casual, getting wages directly or indirectly from the employer, or employees engaged through contractor(s) for the purpose of making the Employees' Provident Fund and Miscellaneous Provisions Act, 1952, applicable to an establishment. ¡Levy of interest upon the EPF dues not deposition by the employer within the stipulated time, due to any reason, is mandatory and justified irrespective of the fact as to whether the establishment is in private sector or public sector or industrial or non-industrial or non-profit making or profit-making. THE AMOUNT MAY BE SMALL OR LARGE; IT IS THE ACT OF MISAPPROPRIATION THAT IS RELEVANT In a case of The Life Insurance Corporation of India & Others vs. S. Vasanthi, the Hon'ble Supreme Court of India through its bench comprising Hon'ble Justices Mr.J. Cheameswar and Mr.A.K.Sikri pronounced that ¡Tampering of documents, thereby causing financial loss to the employer by an employee, is a serious misconduct. ¡If an employee is held guilty of the charges of tampering the insurance policies causing financial loss to the insurance company, the punishment of recovery of amount of loss suffered by the employer in addition to reduction in basic pay of the employee is not shockingly disproportionate. ¡Court has no power to interfere in the quantum of punishment, imposed by the employer upon the employee, under power of judicial review without giving convincing reasons. ¡High court while exercising its judicial review power, cannot sit as departmental Appellate Authority since the same is not permissible in law. ¡Quantum of punishment and nature of penalty to be awarded is exclusively within the jurisdiction of the competent authority/employer. ¡Judicial review on the administrative action is limited only to the cases where there is any illegality, irrationality and procedural impropriety in the order passed by the administration authorities. PAGE 06 REGULATIONS FRAMED BY THE EMPLOYER CANNOT SUPERSEDE THE PAYMENT OF GRATUITY ACT, 1972 In a case of Union Bank of India vs. Ram Mohan, the Hon'ble Kerala High Court through the verdict by Hon'ble Justice Mr.A.K. Jayasankaran Nambiar pronounced that ¡Gratuity of an employee cannot be withheld except as per statutory provisions under section 4(6) of the Payment of Gratuity Act, 1972 cannot be subject to the provisions of rules and regulations framed by the employer regulating service conditions of the employees. ¡Payment of Gratuity and Payment of Pension are of right in the nature of property in the hands of employees having protection under Art.300A of the Constitution of India and not bounties from employer to employees. ¡Regulations do not have overriding effect over the statutory provisions of the Payment of Gratuity Act, 1972. ON INFRINGEMENT OF STANDING ORDERS OR INDUSTRIAL DISPUTES ACT THE JURISDICTION OF CIVIL COURT IS BARRED In a case of Pale Ram vs. The Presiding Officer, Industrial Tribunal-cum-Labour Court, Rohtak and Another, the Hon'ble Punjab & Haryana High Court through the verdict by Hon'ble Justice Mr.Gurmeet Singh Sandhawalia pronounced that ¡Once the workman had chosen to avail remedy under common/civil law, he could not resort to the other regulations since the judgment of the civil court would operate as resjudicata Disputes Act or any other Special Law/Act. ¡If an employee intends to enforce his constitutional or statutory right, civil court will have the necessary jurisdiction to try the suit. ¡Only because an employee is a workman under Industrial Disputes Act, 1974 or his conditions of service are governed by standing order, certified under the Industrial Employment (Standing Order) Act, 1946, it would not be correct to contend that ipso facto civil court will have no jurisdiction. ¡When the infringement of provisions of standing order or Industrial Disputes Act is alleged, the civil court jurisdiction may be barred. ¡If no right is claimed under special statute in terms whereof the civil court will have jurisdiction. PAGE 07 ESIC WAGES CEILING REVISION PLANNED ¡The Government proposes to increase wage ceiling for Employees' State Insurance Corporation (ESIC) benefits under the ESI Act after improving medical service. The Lok Sabha was informed on 22nd December 2014. Labour Minister Mr.Bandaru Dattatreya said during question hour that the ESIC has taken a number of decisions to improve the medical services to be provided and to increase wage ceiling for eligibility to use ESIC benefits. He said as on March 31, 2015 there would be 1.74 crore employees enrolled under the ESI act. WORKING HOURS TO BE REVISITED ¡As regards the amendment to increase the spread of working hours from the existing 10.5 hours to 12 hours, the parliament standing committee urged the Labour Ministry to revisit the matter, as it feared that it may lead to the harassment of the workers on being compelled to stay in the workplace for a longer period without adequate compensation. ¡The Bill, one of key labour reforms being pushed by the Narendra Modi Government, was introduced in Lok Sabha on August 7 last year. It was referred to the Parliament Standing Committee by the Speaker for examination and report within three months after several MPs sought clarifications. The Parliament Standing Committee later got time extension to present the report to the house by December 23, 2014. 20 LAKH APPRENTICES TO BE ENGAGED ¡Under the Apprentice Protsahan Yojana launched in October last year the Ministry of Labour and Employment would support one lakh apprentices in the next two-and-a half years and share 50 per cent of the stipend. ¡“We have a vision to have more than 20 lakh apprentices in the next few years against the present number of 2.8 lakh. In fact, enhanced rates of stipend have also been noticed for trade payable indexed to minimum wages of semi-skilled workers,” Labour Minister Bandaru Dattatreya said. EMPLOYMENT EXCHANGES WILL NO MORE BE MERE REGISTRATION CENTERS ¡Union Minister of State for Labour and Employment Mr.Bandaru Dattatreya said that the national employment exchanges have turned into mere registration centers for the unemployed and the center is working to changes it to national career council centers. The center would provide Rs.292 crore for that purpose. ¡The portal would be launched in March 2015 and would also host 100 model career centres and vocational rehabilitation centers, said Dattatreya. PAGE 08 THE EMPLOYEES' PROVIDENT FUNDS (FIFTH AMENDMENT) SCHEME 2014 ¡In exercise of the powers conferred by section 5, read with sub-section (1) of section 7 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952) and in supersession of Ministry of Labour and Employment's notification dated the 6th May, 2014 except as respect things done or omitted to be done before such supersession, the Central Government hereby makes the following Scheme, further to amend the Employees' Provident Fund Scheme, 1952, namely:¡This Scheme may be called the Employees' Provident Funds (Fifth Amendment) Scheme, 2014 and it shall come into force from 1st April 2011. ¡In the Employees' Provident Fund Scheme, 1952 in sub-paragraph (6) of paragraph 60 the following proviso shall be inserted, namely:¡“Provided that if the settlement of claim in respect of an operation account is delayed for more than thirty days from the date of receipt of the application for settlement of claim, interest shall be credited to the account in accordance with sub-paragraph (2) for delay period excluding the period of thirty days”. THE LABOUR LAWS (EXEMPTION FROM FURNISHING RETURNS AND MAINTAINING REGISTERS BY CERTAIN ESTABLISHMENTS) AMENDMENT ACT, 2014 1. Short title and commencement:- This Act may be called the Labour Laws (Exemption from Furnishing Returns and Maintaining Registers by Certain Establishments) Amendment Act, 2014. It shall come into force on such date as the Central Government may, by notification in the Official Gazette appoint. 2. Amendment of Long Title:- In Labour Law (Exemption from Furnishing Returns and Maintaining Registers by Certain Establishments) Act, 1988 (51 of 1988) (hereinafter referred to as the Principal Act). For the long title, the following long title shall be substituted, namely:An Act to provide for the simplification of procedure for furnishing returns and maintaining registers in relation to establishments employing a small number of persons under certain labour laws. 3. Amendment of section 1:- In section 1 of the Principal Act, in sub-section (1) for the words “Exemption from,” the words “Simplification of Procedure for” shall be substituted. 4. Amendment of section 2:- In section 2 of the Principal Act, in clause (e), for the word “nineteen” the work “forty” shall be substituted. 5. Substitution of new section for section 4:- for section 4 of the Principal Act, the following sections shall be substituted. ALL EMPLOYERS TO SUBMIT RETURN IN FORM 5A OF THE EMPLOYEES' PROVIDENT FUND SCHEME By a circular dated 25.2.2015 the Employees' Provident Fund Organisation has instructed all the employers to file a return online stating ownership in Form 5A showing the particulars of all the branches and departments owners, occupiers, directors, partners, manager or any other person or persons who have the ultimate control over the affairs of such factory or establishment. Failure to make compliance would attract 'penalty' as stipulated by section 14 of the Employees' Provident Funds & Miscellaneous Provisions Act, 1952. PAGE 09 web site at www.adp.in Get the ADP expertise working for you. A 60 year track record that speaks for itself. ADP India Thamarai Tech Park, S.P. Plot No. 16 to 20 & 20A Thiru Vi Ka Industrial Estate,Inner Ring Road, Guindy, Chennai - 600 032. Phone: 1-800-4190-237 Email: [email protected]
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