Mrinal 20 May 2016

Help reqd regarding laws for hiring an employee for startup

Hi,
I am a total novice in the world of laws and am in need of lot of help for my start up.
Being an Engineer i have been training students on technical subjects for last 2 years. Now i am planning to register as a proprietor & want to hire few Sales & Marketing persons to increase reach of my workshops.

I have few queries in the this regard
1. Probably i would be hiring Graduates / MBA's & I have not registered under Shops & Establishments Act so can i hire employee? Can i give them Offer letter / Appointment Letter?

2. Being a startup, I don't have a sound budget & I may not be able to manage to pay them heavily, in such a case how much minimum salary i can pay. What are the laws / acts i need to know?

3. Can i issue experience certificate? What all legal regulations in need to follow?

4. Do i need any other registration like TAN / PF etc.? What if i don't want to take these registrations right now since i am still in testing phase and do not have enough time & manpower to look after these statutory compliances ?

I need urgent help on these issues as i am totally stuck & confused. It would be highly appreciable if i am given a list of laws i need to look into for future queries. Thanks in advance :)

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11 Replies

Kumar Doab (FIN) 20 May 2016

You should register, under Shops & Establishments Act, PF,ESIC.

The fee is so nominal that it is negligible.

You msut issue offer/appointment letter and keep everything transparent, upfront,clear. The T&C should be as provided for in the Shops & Establishments Act.

You can issue service certificate, relieving letter, salary slip,Form16 etc....

A local labor Law Consultant can guide you further.

Mrinal 20 May 2016

Thank you so much for your reply sir. I also believe that i should apply for all the licenses but my only problem is that i am planning to hire my first employee & I if I follow so many regulations I will not be able to do my regular work itself. So, is there any way out tso that everything remains transparent & i don't have to carryout so many regualtions. I would reiterate that I want to do it following all the laws.

Kumar Doab (FIN) 20 May 2016

Your counsel shall take care of everything.

Or you may visit: Inspector appointed under Shops & Establishments Act, PF,ESIC, and ask them, would they spare you if you don't comply.

Kumar Doab (FIN) 20 May 2016

If there is a Commissioner appointed for Start Ups then that office also can give you desired inputs.

Mrinal 20 May 2016

Got your point sir

Need another clarification on the same line

If I hire someone through a manpower management company who will pay him the salary then will I need to get all these registrations done?

Kumar Doab (FIN) 20 May 2016

Eventually you may land up as Principle Employer.

In case of non compliance by the agency or contractor the liablity can be fastened on you.

Rest your able counsel at your location may be engaged to guide further.

Mrinal 20 May 2016

Thanks

Kumar Doab (FIN) 21 May 2016

You are welcome.

Engage/Retain an able counsel.

It shall help you in the long run.

T. Kalaiselvan, Advocate (Advocate) 25 May 2016

You said you are novice to this subject, since you want to do business and grow, why dont you do it properly by consulting a local consultant who will be able to guide by explaining the procedures and formalities.

Take the help of a consultant or an adviser so that you dont face any hardship or get stuck in between.