Is a Four-Digit Employee Code Necessary for Small IT Firms? Seeking Clarity

Dear Members, I am working in the HR department of a small IT firm and want to create an employee code for the employees. Is it mandatory that the employee code should be of four digits? Please clarify.

Regards,
Shallu Sabharwal

It is not mandatory for the employee code to be four digits. Four digits are typically used to support software systems utilized by various organizations for entering employee details. However, it is not a requirement for the employee code to specifically be in four digits.

Regards,
Bharghavi

Like Bharghavi and S. Rajasekaran mentioned, it's not mandatory to have 4-digit Employee Codes, nor is it a must to limit it to 4 digits. To go further, the basic premise/logic by which the number of digits to be used for an Employee Coding System is decided by the long-term number of employees the company is projected to add. While this timeframe isn't a fixed one, many companies use a period of around 10 years, to the extent I know.

Coming to your company's present situation (which I presume would be having fewer than 100 employees), a 4-digit coding system should be sufficient since it would handle an employee strength of up to 9,999.

Regards,
TS

I agree with the view of members that it is not mandatory. However, we should think of future requirements of the organizations, corporate branches, subsidiaries, sister concerns, overseas branches, transfers between locations, and interdepartmental transfers. Hence, we need to take care of these aspects and add a prefix code to the employee. This will help in resolving issues over decades.

If the employee code is not less than 6 digits, it would be sufficient for 2 to 5 decades. Also, we should consider the Types of Employees the company engages with, such as permanent, temporary, on contract, on loan, part-time, full-time, and also levels from 1 to 20 or 30.

I hope this sufficiently takes care of the concerns.

You can create your employee code with your company's starting letter followed by a 5-digit number. For example, ABC Pvt Limited can be represented as A00001. This system allows for the assignment of unique employee codes for up to 99,999 employees, which would be sufficient for approximately 50 years, even in the case of significant company growth (assuming 1,000 employees in the company).

I suggest creating the employee code using the PF number of the employee, as this would make it easier for everyone to track. In the event that an employee is not registered for PF, the employee code could be allocated based on the Date of Joining (DOJ) of the employee. This approach ensures that there are no issues when registering for PF and allocating employee numbers.

Kind regards

In the near future, EPFO is introducing a unique PF code for each member, which can be used by any employer to remit his/her monthly contributions. Hence, there is no need to struggle at this juncture. You can follow the current practice, and upon hearing from PF authorities, you can switch over to the new system.

If you have an autogenerated employee ID, you can link the PF number; in case of transfers, the sequence may change. One needs to be careful regarding PF as there are tremendous changes in the process. You may need to stay abreast of the latest developments.

As all the members suggested, it is not mandatory to have employee code numbers, but for ease, we should have them for identifying the employees. Yes, for the ease of identifying different employees with the same names, we should allot the code numbers.

Moreover, in SAP HR processes, a unique code of eight digits is automatically generated by the system. This SAP code is used to carry out further actions, such as salary processing, giving loans and advances, changing pays, transfers or promotions, and making other changes.