Labour Law Consultant in Ahmedabad: CA Murli Chandak’s Guide to the Labour Codes, Shram Setu, PF, ESIC and Payroll Compliance

In short: CA Murli Chandak is an Ahmedabad-based Chartered Accountant (FCA) who runs labour-law compliance for employers as a payroll-linked, audit-ready process: applicability mapping under the new Labour Codes, establishment registration on Gujarat’s Shram Setu portal, PF and ESIC filings, wage-structure review, contractor-compliance controls, POSH framework and inspection readiness. Because the work starts from the books and payroll, the compliance record also holds up in the statutory audit, tax audit and any due diligence. The first 30-minute consultation is free.

Contents
1. Why Labour Compliance in Ahmedabad Is Now a Finance Question
2. What the Labour Codes Changed for Employers
3. Applicability Snapshot: Verified Thresholds at a Glance
4. Establishment Registration in Gujarat and the Shram Setu Portal
5. Wages and Salary Structure: The Part That Moves Your Numbers
6. PF and ESIC: Registration, Contributions and Reconciliation
7. Contract Labour: Protecting the Principal Employer
8. Working Conditions, Safety and Employee Records
9. POSH Compliance
10. Gratuity, Bonus and Exits
11. Inspections and Notices
12. How an Engagement Works
13. Fees
14. Why Work With CA Murli Chandak
15. Frequently Asked Questions

1. Why Labour Compliance in Ahmedabad Is Now a Finance Question

A labour law consultant in Ahmedabad is usually hired after something goes wrong: an EPFO query on wage definition, an ESIC inspection, a contractor who stopped paying workers, or a gap noticed by an auditor. The underlying cause is rarely ignorance. It is that labour obligations sit across payroll, HR, accounts and operations, and no single function owns the whole picture.

That is why CA Murli Chandak’s Ahmedabad practice approaches labour compliance from the numbers outward. Wages, contributions, provisions and contractor bills all land in the books. When the statutory side and the accounting side are tied together every month, filings are accurate, audits are uneventful and management can see its exposure at any time.

Ahmedabad makes this harder than it looks. A single promoter group may run a head office around SG Highway, a warehouse on the periphery and a plant in an industrial estate such as Vatva, Naroda, Odhav or the Sanand belt, with different workforce profiles, contractors and registrations at each. Textile, chemical, pharmaceutical, engineering and services businesses each bring their own mix of permanent staff, contract workers and shift patterns.

2. What the Labour Codes Changed for Employers

The Ministry of Labour and Employment announced that the four Labour Codes were made effective from 21 November 2025, rationalising 29 existing labour laws. The four Codes are the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020 and the Occupational Safety, Health and Working Conditions Code, 2020. The Government’s release highlights, among other features:

• mandatory appointment letters for workers;
• gratuity for fixed-term employees after one year of continuous service;
• social security coverage extended to gig and platform workers;
• a free annual health check-up for workers, which the release describes for those above 40 years of age. The precise scope depends on the rules, so it should be confirmed against the applicable notification.

Rules, forms and state notifications under the Codes continue to be issued and revised. For an employer, the practical consequence is that a compliance framework built before November 2025 needs a documented review, and that review should be repeated when new rules are notified. The Ministry has also published a Compliance Handbook for Employers that is a useful primary reference alongside the Codes themselves.

3. Applicability Snapshot: Verified Thresholds at a Glance

The table below collects thresholds that have been checked against official material. It is a starting point for the applicability assessment, not a substitute for it, because coverage turns on the nature of the establishment as well as headcount.

Area	Position	Official source
Establishment registration (OSH&WC Code, Section 3)	Establishments with 10 or more employees apply electronically; changes in particulars are intimated within 30 days	Ministry of Labour and Employment, Compliance Handbook
Contract labour provisions (OSH&WC Code, Section 45)	Apply where 50 or more contract labourers were employed on any day in the preceding 12 months	Ministry of Labour and Employment, Compliance Handbook
Contractor licence (Sections 47 and 48)	Required for a contractor employing 50 or more contract workers; licence valid for 5 years	Ministry of Labour and Employment, Compliance Handbook
Wages definition (Code on Wages, Section 2(y))	Where specified exclusions exceed 50% of total pay, the excess is treated as wages	Ministry of Labour and Employment, Compliance Handbook
ESIC contribution rates	Employer 3.25% and employee 0.75% of wages (employee rate effective 1 July 2019)	ESIC: Contribution
ESIC coverage	Non-seasonal factories employing 10 or more persons, plus establishments extended by Government; wage limit of Rs 21,000 per month (Rs 25,000 for persons with disabilities)	ESIC: Coverage
Gratuity for fixed-term employees	Eligible after one year of continuous service	Government release dated November 2025 (PIB)

Rates, ceilings and thresholds are revised from time to time, so each is re-confirmed on the official portal at the time of every engagement and payroll cycle.

4. Establishment Registration in Gujarat and the Shram Setu Portal

Gujarat’s Labour Department runs the Shram Setu portal. The portal’s 2026 user manual for registration and licensing covers the OSH&WC Code process: the establishment master, the application for registration of an establishment, responses to queries raised on an application, and, for contractors, the application for a licence and the related bank guarantee step.

For an Ahmedabad employer this means registration is not a one-time exercise to be filed away. A useful working discipline is to:

• decide which of your locations are separate establishments and which category each falls into;
• assemble the establishment master data once, accurately, and keep it aligned with the GST, PF and ESIC records;
• track and respond to departmental queries within the time allowed, since an unanswered query stalls the application;
• file changes when headcount, address, management or contractor arrangements change;
• check the Labour Department’s current notices on the portal for transition timelines before assuming that an earlier registration under a legacy Act is sufficient.

The same registration data later feeds contractor licensing, inspection responses and ESIC and PF coverage decisions, which is why errors at this stage tend to recur for years.

5. Wages and Salary Structure: The Part That Moves Your Numbers

The Code on Wages defines wages by reference to basic pay, dearness allowance and retaining allowance, with listed exclusions such as house rent allowance, conveyance allowance, overtime and commission. Where the excluded items exceed 50% of total pay, the excess is treated as wages. That one rule can change the base on which a company calculates several obligations, including contributions and gratuity.

A Chartered Accountant is well placed to test this because the effect runs through the accounts:

• Salary structure. Allowance-heavy cost-to-company structures should be re-tested against the 50% rule, employee by employee or by grade.
• Statutory cost. A wider wage base can raise employer contributions and gratuity cost, which should be reflected in budgets and, where relevant, in pricing and contracts.
• Employee benefit accounting. The effect on gratuity should be discussed with the actuary and reflected as the applicable standard (Ind AS 19 or AS 15, as relevant to the entity) requires.
• Payroll records. Registers, payslips and bank-payment evidence should show how each component was treated, so the position can be explained to an inspector or auditor.

Minimum wages are fixed by the appropriate Government’s notifications and depend on the scheduled employment, skill category and area. Each employee and contract worker should be mapped to the right category and checked against the latest Gujarat notification before wages are finalised. The notified rate of an earlier year should never be assumed to continue.

6. PF and ESIC: Registration, Contributions and Reconciliation

6.1 Provident Fund

PF work is a monthly cycle rather than a registration. It includes the employer code, UAN and KYC maintenance for employees, contribution calculation on the correct wage base, deposit and return through the EPFO portal, and reconciliation of payroll with EPFO records. Whether a particular establishment or employee is covered depends on the facts, including the nature of the establishment, the wage position and any voluntary coverage, so applicability is decided case by case and not from headcount alone.

6.2 Employees’ State Insurance

ESIC covers eligible employees within the wage limit, with contributions of 3.25% by the employer and 0.75% by the employee on wages, according to the Corporation’s website. The recurring work consists of employer registration, insurance numbers for each eligible employee, accurate wage and entry and exit updates, timely payment and support for claims and inspections. Crossing the wage limit in a month does not necessarily end coverage within a contribution period, so mid-period changes should be handled with care.

6.3 Why timing matters beyond the penalty

Late deposit of PF and ESIC contributions carries interest and damages under the relevant law and can also affect the income-tax deduction available for those contributions. The deposit date is therefore tracked in the monthly closing checklist, so that the compliance team, the accountants and the tax auditor work from the same dates.

7. Contract Labour: Protecting the Principal Employer

Many Ahmedabad factories, warehouses and facility operations depend on contractors, and the OSH&WC Code is clear that engaging a contractor does not move the risk away. Under the Ministry’s handbook, where a contractor fails to pay wages within the prescribed period or pays less than due, the principal employer is liable to pay the contract labour (Section 55), and the principal employer also provides specified welfare facilities (Section 53).

A monthly release-of-payment control works better than a once-a-year audit:

• check the contractor’s licence and registration status and its validity period;
• obtain the wage register and bank-payment evidence of the month before paying the contractor’s bill;
• match the PF and ESIC challans and returns to the list of workers deployed;
• reconcile the headcount billed with the headcount recorded at the gate or by biometric attendance;
• keep a contractor file for each vendor with agreement, licence, insurance and compliance proofs.

This is the point at which labour compliance and accounts payable meet. A contractor bill that is released without compliance proof converts a vendor’s default into the employer’s liability.

8. Working Conditions, Safety and Employee Records

The OSH&WC Code consolidates the law on safety, health and working conditions. The areas that need ongoing attention include working hours and overtime records, weekly and public holidays, leave records, night-shift conditions for women employees where applicable, appointment letters, welfare facilities, safety documentation, accident reporting and the health check-up provisions notified under the Code.

Records are the evidence of compliance. Muster rolls, wage registers, leave ledgers and appointment letters that agree with each other carry far more weight in an inspection than a well-meant explanation. For factories and larger units, the documentation should also show corrective actions closed after internal safety reviews.

9. POSH Compliance

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 requires every employer to constitute an Internal Committee by written order (Section 4) and to provide a safe working environment (Section 19). Where an establishment has fewer than ten workers, the Act provides for a Local Committee at district level (Section 6). The Committee submits its annual report to the employer and the District Officer (Section 21), and the employer discloses the number of cases filed and disposed of in its annual report or, where none is required, informs the District Officer (Section 22). The full text is available on India Code.

A workable POSH framework includes an adopted policy, a properly constituted Committee, periodic awareness sessions, a documented complaint procedure that respects both complainant and respondent, and a calendar for the annual reporting. Branches and administrative units located apart from the head office should be checked separately.

10. Gratuity, Bonus and Exits

Separation is where documentation gaps surface. The areas to keep in order are gratuity eligibility, calculation and nominations (now including fixed-term employees after one year), bonus applicability and computation, notice-period and resignation records, full and final settlement, relieving documents and the procedure for retrenchment or closure, which carries specific requirements. Dues that remain unpaid should be recognised in the books at the right amount, so that the financial statements and the HR records tell the same story.

11. Inspections and Notices

Inspections and notices may come from the Labour Department, EPFO, ESIC or the factory authorities. The handling process is consistent: record the date and deadline of the notice on the first day, identify the exact period and issue, reconcile the records, assemble the supporting documents and send a reasoned reply on time. A prepared document file, built in advance from the compliance calendar, turns most visits into routine events. Where a matter becomes a prosecution, adjudication or tribunal proceeding, the client’s advocate leads the legal presentation and CA Murli Chandak supports with the payroll, wage and records-side analysis.

12. How an Engagement Works

An engagement runs in defined stages:

1. Discussion and document review: operations, locations, workforce categories and existing registrations.
2. Applicability matrix: a table of each registration, return, record and policy, with frequency and due date.
3. Gap analysis: comparison of the matrix with what is actually in place, including a payroll-to-books reconciliation.
4. Rectification: registrations, amendments, policy documents and salary-structure changes.
5. Compliance calendar: monthly, quarterly and annual dates, owners and evidence required.
6. Monthly monitoring: checks of contributions, filings and contractor proofs before payment.
7. Periodic review: at least annually and after expansion, restructuring or new rules.

Data about employees is personal and financial. Documents are shared through secure channels, and access is limited to what the assignment needs.

13. Fees

Fees depend on scope: the number of establishments, employee strength, the share of contract labour, the volume of PF and ESIC filings and whether the work is one-time (a review or registration) or a recurring monthly retainer. CA Murli Chandak follows a scope-first approach. After the free consultation, a written quotation states what is covered, what the client’s team provides each month, and how any notice work is billed. Government fees are shown separately from professional fees.

14. Why Work With CA Murli Chandak

CA Murli Chandak is a Fellow Chartered Accountant (FCA) with 8+ years in practice, based in Ahmedabad. His grounding is in audit and assurance. He was earlier a Partner at an Ahmedabad CA firm handling bank statutory and concurrent audits and due diligence. That discipline of documented reconciliations and supported positions is what labour compliance now demands. He is also an IBBI-Registered Valuer (Securities or Financial Assets) with 300+ valuations completed across 7+ countries, which means businesses planning fund-raising, ESOPs or a transaction get compliance and valuation support from one advisor. Employers often combine this work with GST compliance, Virtual CFO oversight or company registration support. A fuller professional background is set out on the About page.

15. Frequently Asked Questions

What does a labour law consultant do for an Ahmedabad employer?
The consultant identifies the laws that apply to the business, handles registrations and recurring filings, reviews wage structures, controls contractor compliance, builds the compliance calendar and supports inspections and notices.

Do the new Labour Codes apply to my business already?
The four Codes were made effective from 21 November 2025. How each provision applies to you depends on your establishment, workforce and the rules notified, so a documented applicability review is the right first step.

Do I need to register on Shram Setu?
Gujarat’s Labour Department uses the Shram Setu portal for OSH&WC Code registration and licensing. The Code requires establishments with 10 or more employees to register, so confirm your position and any transition timelines against the portal’s current notices.

Does every business have to register for PF?
Not automatically. Coverage depends on the nature of the establishment, the workforce and the wage position, and may also arise by voluntary coverage. It should be assessed case by case on the EPFO framework.

What are the ESIC contribution rates?
According to ESIC, the employer pays 3.25% and the employee 0.75% of wages, with a coverage wage limit of Rs 21,000 per month. Always re-confirm on the ESIC website before each payroll cycle.

What is the 50% wages rule?
Under the Code on Wages, where allowances and other listed exclusions exceed 50% of total pay, the excess is treated as wages. It can raise the base for contributions and gratuity, so salary structures should be reviewed.

Am I responsible if my contractor does not pay workers?
Under the OSH&WC Code as summarised in the Ministry’s handbook, the principal employer is liable to pay contract labour where the contractor fails to pay wages or short-pays. Monthly proof-based payment release is the practical safeguard.

Do small employers need an Internal Committee under the POSH Act?
Every employer must constitute an Internal Committee. Where an establishment has fewer than ten workers, the Act provides for a Local Committee at the district level. The Act sets out the details.

How often should a labour compliance review be done?
At least once a year, and after expansion, restructuring, a change in contractors or the notification of new rules.

Does CA Murli Chandak work only with Ahmedabad businesses?
The practice is based in Ahmedabad, which helps with registrations, document work and in-person reviews. The monthly cycle runs digitally, so employers across Gujarat and India can be served on the same process.

Book a Free 30-Minute Labour Compliance Consultation

Whether you need an applicability review under the Labour Codes, Shram Setu registration support, a wage-structure test, contractor controls or a reply to a notice, the starting point is the same conversation. The first 30 minutes are free.

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CA Murli Chandak – FCA | IBBI-Registered Valuer (Securities or Financial Assets) | IBBI/RV/07/2021/14408
Website: murlichandak.com
Phone: +91 99985 39902
Email: murlichandak@murlichandak.com
LinkedIn: Connect with CA Murli Chandak

Disclaimer: This article is for general information only and does not constitute legal, tax or professional advice. Labour-law rules, rates, thresholds and state notifications change, and the positions stated here were checked against publicly available official sources in October 2026. Please confirm them against the latest official material before acting. Engagement terms, scope and fees are confirmed in writing before any assignment begins.