In M/s PM Patel and Sons and Others V/s Union of India and Others, 1986, the Hon’ble Supreme Court observed that the terms of the definition of “employee” as per Section 2(f) of the Provident Fund Act were wide, in as much as, they included not only persons employed directly by the employer but also persons employed through a contractor. Moreover, the definition included not only persons employed in the factory but also persons employed in connection with the work of the factory. The Hon’ble Court, in the present matter observed that the home workers in question were involved in an activity connected with the work of the factory. Further, The Hon’ble Court observed that for an individual to be an employee, it is necessary that the relationship of master and servant should exist with the employer. In light of the facts and circumstances of the present case and referring to previous decisions by the Apex Court, the Hon’ble Court found sufficient evidence of requisite degree of control and supervision for establishing the master-servant relationship between the employees and the employer and therefore held the home-workers to be “employee” s.
Finally, in connection with the above matter, the Hon’ble Court found no substance whatsoever in the contention that the provisions of the Employees’ Provident Funds Act and the Scheme could not be applied at all to home workers and reject the same.