My company is a mid-size organization and they have been giving salaries of contractor’s employees’ from their own account and after that, they pay a service charge to the contractor. How big is this issue?
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If the payment is given directly to the contract (temp) people then this is easily a case where anyone from them claiming this as salary paid for services given. Therefore this will easily bring all liabilities like PF, Gratuity, etc to your company and not the contracting company, therefore this must be stopped immediately and the salary amount and margin should be paid to the contracting company and not their employees directly.