Hi,
We are running a real estate company. We hired a security agency for manning project site. The security agency has given quotation adhering to minimum wages as applicable for security guards in Tamil Nadu. In his salary split-up, Security agency has shown the following:
- Basic (A) - minimum wage as fixed by Tamil Nadu Governemnt for Security guards
- DA (B) - as per latest notification
- Employer PF contribution @ 13.36% of A+B
- ESI @ 4.75%
- Bonus on Rs. 7,000/-
- Leave Wages 1.5 Days [(A+B)/26]*1.5
- N/P Holidays [(A+B) / 26] * (9/12)
- Service charge @ 10% on item 1 to 7
- Service tax as applicable on event date
Please clarify the following:
- Why agency is charging Bonus which he has to give to security guards. Should it not be from his profits? i.e. from Service charge which he is collecting from us?
- Whether Employer PF, ESI, Leave wages are not part of minimum wages itself?
- Is it mandatory for Security agency to contribute Employer PF/ ESI when basic wage is more than Rs. 6500/-? Even if they want to contribute, should they need to collect from Principal Employer?
- Is Security agency correct in charging Service Charge on item 1 to 7, which also includes Employer PF, ESI, Bonus, Leave wages?
