Understanding PF and ESIC Registration: Can Our Small Firm Apply with 11 Employees?

In our firm, we have 11 employees, of which 6 members' salaries are more than 20K. Can we apply for PF and ESIC registration?

Thanks
Regards

Dear Manoj,

No, your company does not have employment strength less than 20 for the purpose of coverage under the Employees' Provident Fund & Miscellaneous Provisions Act, 1952. When your employee strength (those earning less than 15,000/-) reaches 20 (assuming you are not running your establishment with power), then your company will be covered under the provisions of the Employees' State Insurance Act, 1948.

A slight modification... nowadays, ESI is extending the scheme to the shops and establishments wherever the number of persons (not employees), i.e., now there is no question of coverable employees; if there are 10 (previously it was 20) such units, they are coverable under ESI.

The above-mentioned notifications are issued individually by various states under section 1(5) of the Act. So, please ensure whether such a notification has been issued in your state or not.

All the best.

Yes, of course, voluntary coverage for PF is possible under Section 14(1) of the EPF & MP Act, 1952.

Regards,
Parag

[Phone Number Removed For Privacy Reasons]

Dear Friends,

As per the PF & ESI Act, registration is not mandatory if the firm has less than 20 employees. It also states that the principal employer is liable if the contractors default on payment.

If a contracting company has 8 employees on their payroll but engages subcontractors to accomplish their work, where they also hire laborers on a daily basis, please let me know if the contracting company now has to register under ESI & PF.

Regards,
Suresh