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An establishment covered by the employees' state insurance provisions of the Code on Social Security, 2020 engages some of its workers through a contractor. Under section 31(1) of the Code, who must…

Question and options

An establishment covered by the employees' state insurance provisions of the Code on Social Security, 2020 engages some of its workers through a contractor. Under section 31(1) of the Code, who must pay the contributions for those workers?

  1. The employer and the contractor jointly, each paying half

  2. The contractor the employee's share, the employer the employer's share

  3. The employer, paying both the employer's and the employee's share

  4. The contractor, paying both shares, since he engages the workers

Answer and explanation

Correct answer: C - The employer, paying both the employer's and the employee's share

Section 31(1) of the Code on Social Security, 2020 requires the employer to pay, for every employee whether employed directly or through a contractor, both the employer's contribution and the employee's contribution. The employer may then recover what it paid from the contractor, who may recover only the employee's share by deduction from wages. Section 31(3) bars deducting the employer's share from wages.

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