Is Managing Director an Employee of the Company?
Is Managing Director an Employee of the Company ?
Meaning of a Managing Director is given in
) of the
(earlier defined under section 2(
) of the
A Managing Director is a director,
by virtue of the articles of association of a company or
by an agreement with the company or
by a resolution passed in its general meeting of shareholders, or by its Board of Directors,
is entrusted with substantial powers of management of the affairs of the company and
includes a director occupying the position of managing director, by whatever name called.
Not every Directors of a company are employee of a company. But every Managing Director of a company is an employee of that company.
A Managing Director of a company plays dual role for his company
Employee i.e. as a Manager
Generally, a company enters into a service contract with the Managing Director for his appointment and terms of remuneration. This contract is a contract of employment.
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