Hi, Can anyone help me with PF & ESI Compliances and the procedures for the same. Regards, Ruchika
From India, Hyderabad
Hi Ruchika
We are PF and ESI consultants in Delhi.
If your company is in Delhi and you seek our services we can guide you in this respect.
You can write in your queries at

From India, Delhi
Hi Ruchika..

Here is the details that you asked over citehr.

The formalities for ESI is you must have a strength of 20 employees, no matter whether they are getting salary more than 10000/- or lesser. As maxcimum ceiling of ESI contribution is upto 10000/- Gross/Month only. Those getting 10001/- will be exempted from the ESI.

Yes ESI and ESIC is same. ESIC stands for Employee State Insurance Corporation..

The Employer should get the Factory or Establishment registered with the ESI Corporation within 15 days of the applicability of ESI Act. The declaration of registration is to be filled in form 01, along with a separate sheet containing the name and address of the Establishment, number of employees, nature of duty and name, designation and address of the manager controlling such persons, in respect of office situated outside. After been satisfied with the application the ESI regional office will allot a code number to the employer.

After that only you can register your employees with the ESI. They have to fill up a declaration form FORM 1, written clearly Male or Female. All the declaration forms should be counter signed by the employer.

Then prepare a return of declaration in form 3 separate for Male & Female within 10 days of filling of declaration form.

Then every employee shall be alloted an temporary identification number.

For PF formalities the company must be 3 years old. After that only it can be registered with the PF department. Even for this Act also the minimum number of employee should be 20.

Every employer of an establishment to which the Employee Provident Fund Act applies, should submit in Form 5A(in duplicate) to the commissioner, particulars of all the branches and departments, owners, directors, partners if any or any other person who is controlling its affair within 15 days of its applicability of the scheme.

On receipt of Form 5A, the commissioner shall verify the particulars submitted and after been satisfied shall allot an Establishment Code No.

Hope now it will be very much clear with you.


Amit Seth.

From India, Ahmadabad
Kindly click on the following link, it will give you some required information,

From India, Coimbatore
Hi Ruchika

A brief note on PF, Hope you find it informative

Provident Fund is regulated by Employees’ Provident Funds & Miscellaneous Provisions Act, 1952. It applies factories or to such establishments as may be notified by the Central Government, which are employing 20 or more persons.

The expression “Employee” has been defined under Section 2(f) of the EPF Act to mean any person who is employed for wages in any kind of work, manual or otherwise, in or in connection with the work of an establishment and who gets his wages directly or indirectly from the employer and includes any person employed by or through a contractor in or in connection with the work of the establishment and an apprentice (except apprentice under the Apprentices Act, 1961 or under the Standing Orders of the establishment).

Wages - For the purposes of deduction of contribution, wages would include Basic Wages, Dearness Allowance, Cash Value of any Food Concession and Retaining Allowance, if any.

Contribution - Contribution is required to be paid in respect of employees, whose basic wages, dearness allowance, cash value of food concession and retaining allowance does not exceed Rs. 6,500/- per month. For employees, who are already covered under the Scheme and cross this limits, the contribution is payable limited to Rs. 6,500/- per month.

The amount of contribution is 12% by the employer and 12% by the employee. It is the duty of the employer to deduct the employees’ contribution from his wages and deposit with the P.F. Authorities on or before 15th of the succeeding month. If the employer commits default, he is prohibited from recovering employees’ contribution from his future wages and the liability has to be borne by the employer.

In addition to the said contributions, employer is also required to pay administrative charges @ 1.10 of the employees’ wages subject to limit of Rs. 5/- every month, for the administration of Provident Fund, and @ 0.01% of the employees wages subject to a minimum of Rs. 2% every month for administration of Deposit Linked Insurance Fund.

Out of 12% contribution deducted from the employees’ wages, 8.33% is to be deposited in the Provident Fund, 0.5% in the Deposit Linked Insurance Fund and the balance in the Provident Fund. Employers entire contribution of 12% is to be deposited in the Provident Fund.

If an employee wants to deposit more than the statutory limit in his P.F. Account, he can do so and he may authorize the employer in writing. The Additional contribution by an employee is restricted to 8% of his wages eligible for P. F. Contributions.

Penalties - Provisions for penalties is made in Sections 14, 14A and 14AA of the EPF Act. In nutshell the following are punishable :-

(a) making or causing to be made any false statement or false representation for the purposes of avoiding any payment under the Act, the penalty is imprisonment upto 1 year or fine of Rs. 5,000/- or both

(b) contravention of payment of contribution, inspection charges or administrative charges is punishable (i) with imprisonment upto 3 years but not less than 1 year and fine of Rs. 10,000/-, in case of default in payment of employees’ contribution, which has been deducted by the employer from the employees’ wages (ii) imprisonment shall not be less than six months and fine of Rs. 5,000/- in any other case.

However, Court has the discretion to impose lesser punishment for adequate and special reasons to be recorded in the judgement,

(c) If an offence is committed for the 2nd time, the punishment is imprisonment upto 5 years, but it shall not be less than 2 years and a fine of Rs. 25000/-.

Interest - Employer is liable to pay interest on delayed payment of contributions. The interest would be payable @ 12% p.a simple interest or at such higher rate as may be specified in the Scheme, which shall not exceed the lending rate of interest charged by any scheduled bank.

Damages - Where an employer makes default in the payment of any contribution the P. F. Authorities are empowered to recover the damages not exceeding the amount of the arrears.

Yagesh Sharma

From India, Delhi
Hi Everyone, Thanks so much for the info & support Can you please confirm the interest % and the rate of damages for the late submission of PF & ESI. I need the info on urgent basis. Regards, Ruchika
From India, Hyderabad
Hi Amit,
This is related your details about PF i have a clarification i.e
"For PF formalities the company must be 3 years old. After that only it can be registered with the PF department. Even for this Act also the minimum number of employee should be 20".
Refereing to your above lines what is the total employee strength is above 20 from day, according to me it should be covered under PF from the start only. Correct me if i am wrong.
Amith R.

From India, Bangalore
Hi Amith,
After an amendment in the previous PF Act,
Now onwards, whenever the employee strength reaches of 20, it should be registered with PF Act.
So now entry criteria is almost same with ESI Act for PF Act also..
Amit Seth.

From India, Ahmadabad
hi ruchika,
as required by how that how much intrested employer hv to pay for delay in challan.
employer has to pay 12% intrested for making delay in challan.
hope u will satisfy if not . u r free to ask again.

From India, Mumbai
Dear Ruchika,
Please drop your e-mail address, so that we may send you a presentation on EPF and ESIC.
Further, you may refer to send these websites:-
For EPF: www.epfindia.nic.in
For ESI: www.esic.nic.in
I hope, you'll get every information on these websites. If you have any questions pertaining to the same, please feel free to ask us on Cite HR.

From India, Delhi

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