Reappointment of Employee Driver who's age above 58 Years - under which title like retainer or Trainees or somethings else?

I need your valuable suggestion. Our company wants to appoint one driver who is aged above 58 years. Now, whether this appointment falls under PF, ESIC, or Professional Tax is a question.

Another thing to consider is, if we do appoint him, under which title should he fall? Should it be as a retainer, trainee, or something else?

Extending the services of an employee beyond the age of superannuation is a matter subject to the necessity and willingness of both the employer and the employee. After the introduction of e-governance to EPFO, continuation of an employee beyond 58 years of age as a member of the Scheme is not possible. No such restriction in respect of contributions to ESIC and Professional tax as their purposes are totally different; the former being insurance against accidents and sickness and the latter being a tax levy for employment within the geographical jurisdiction of a Local Authority. You cannot call a driver a retainer or a trainee, but only designate him as a driver.

Dear Umakanthan Sir,

If we employ a candidate after his/her retirement age, are they eligible for benefits like bonus, gratuity, etc.? Should we treat him/her as a regular employee, or do we have to employ him/her on a contractual basis? If we appoint on a contractual basis, how many years or months of a contract are practicable?

Dear Mahendra,

Post-retirement employment under the same employer or elsewhere can be of two kinds, namely employment once again under a fresh contract of service or engagement under a distinct contract for service. In the former, the employer-employee relationship continues, along with the applicable conditions of employment signifying the status of the person employed as an organic part of the organization. On the other hand, in the latter, there is no employer-employee relationship, indicating the status of an external stakeholder only.

In other words, if an existing employee is retained in service after his retirement upon attaining the age of superannuation, whether as a fixed-term employee or as a regular employee, he is entitled to all employment benefits applicable to other employees.

Okay sir,

So, if we retain an employee as a regular employee, we have to pay him/her all benefits like bonus, gratuity, ESI, etc.

If we retain him/her on an 11-month contract, then bonus and ESI may be there, but gratuity will be applicable only if he/she completes 5 years of service. It may not be applicable if the contract is not renewed and the 5 years of service are not completed. However, if we continue to renew the contract and the employee completes 5 years of service with 11-month contracts on continuous renewal, then gratuity may become applicable.

Thank you.

Dear Mahendra,

It depends on the pattern of retention. If the services of the employee are extended beyond the date of superannuation without retirement and settlement of retiral benefits, the extended period would add up to his total service. In such a situation, he would be entitled to the usual benefits as before.

On the contrary, if he is permitted to retire on the date of superannuation and all his terminal benefits are settled, his reemployment would be a fresh innings commencing from the date after his superannuation. In such a situation, his eligibility and entitlement to statutory benefits like gratuity, etc., would be governed by the conditions laid down in the respective laws.

Thank you very much, Umakanthan, sir, for your warm response and sharing your knowledge.