PF Applicability / Alternative - Need Advice

Seniors pls advice.
There is a firm with 200 data entry operators, on an average, every month 10 ppl join and 10 ppl leave.
Applying for PF is a challenge for all these employees. Is there any alternative?
Appreciate your quick response.

Dear Raghav,
Please elaborate your question. Applying for PF is with regard to making them a member or applying for claims.
What is challenge you are facing.

The Challenge is opening of PF accounts for ppl joining the firm and leaving within a month....or within few weeks.

Dear Raghav,
Every company face this problem. We are into retail and I face this often.
You will be generating PF numbers at the end of the month, so by that time if somebody leaves don't include them in your payroll and pay them as a cash as you pay for occasional workers.
But if they leave after the payroll is over, then you have no other way than generating the PF. And that is your responsibility.

Hi,
If the gross salary is more than 6500/- pm, people have the option to opt out of Provident Fund. Please collece a declaration from the employees at the time of appointment only. If they are interested collect FORM-2 else declaration letter that they oupt out of PF. Either way it should be helpful to you.
Thanks

Hi,
There is no alternative available to you except comply with the Act. Act clearly envisages that even if the employee workers for a day you have to cover him under the said Act. Further, if you are not covering employees under the Act even though your establishment comes under the purview of this Act, When Inspection happened after 5 years, the Inspection Authority ask for all documents and if he found that you have not paying contribution of employees he will not only ask to pay the same and apart from this they will put interest and damage after giving 7A notice.
the problem faced by you is administrative in nature but there is no other option to cover the employees who are working for even half a day.
with regards,
bv sudhakar

Friends,
Yes, legally there is no solution. One employee, even for one day also PF has to be contributed. However there are practical difficulties. Some firms try to treat them initially as Probationers or Trainees which again subject to PF. Treating them as Apprentice also got it's own problems. Due to this a few firms after discussions with PF Inspectors try to manupulate their records not showing them in regular pay roll which is also not a legal process. Since they are not able to claim such contributions as F & F settlement employees are also at a loss. Ethically, recovering employees' subscription and not remitting or not settling also not correct, and it's a crime. No other go.
kumar.s.

Most of the Payroll software will have a system of dealing with PF
There are standard forms that you need to ask employees to fill on first day and issue PF number on that basis. If they leave, you need to file the relevant form for that purpose and close the account
Since its now online, it will be easier,
Take the help of a payroll processing firm if you need for getting the work done properly

Dear Bsbraghav,
You have 200 plus employees with you. The provisions of EPF & MP Act are applicable to you. Even any employee works for single day you need to cover him under PF except he is an excluded employee within the meaning under the Act.
I will not advise you to not to show any employee out of payroll and pay him cash. Even you pay cash and this cash is shown as salary / wages in your books is accounts, PF attracts on it. If outsource, you will not be exempted from liability of PF.
Even the provisions of ESI Act are applicable to you.
You need to pay as per MW Rates and comply with all the labour laws applicable to you.
Mind well, you can not escape from the liability of PF & ESI. This liability is from beginning itself.

I agree with the views of Mr. Saswatabanerjee and that of Mr.Keshav. But I can add to this that , this being one of the main function of HR Deptt. , the outgoing members can be advised to get the amount transferred on joining new estt. Instead of filling form for withdrawal and getting attested from the ex-employer.
Chandok A.K.
RPFC (Retd.)
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