Are We Required to Start PF Contributions Now That Our Team Has Grown?

We are an IT company based in Gujarat. Recently, we crossed the 20-employee mark, prompting management to initiate PF contributions. As of today, none of our employees has a basic salary less than Rs. 6500, except for a couple of trainees. However, there are several employees whose basic salary was below Rs. 6500 when they joined (PF was not applicable at that time). Are we now obligated to pay PF if we register at this point?

IT industries are covered under ESI as well as PF if the employee strength reaches 10 employees. Your assumption of 20 is not correct. If the total employees employed in an organization are 10 and above, and even if there is one employee who's earning wages of less than ₹6500, then the organization is to be covered.

Once an employee is covered under PF, even if their wages exceed ₹6500, they are still eligible for PF coverage.

An organization with a minimum of 20 employees can register for the Provident Fund (PF) with the respective regional PF department. An establishment that does not fulfill the required number of employees can voluntarily register with the regional PF department personally. Once an establishment reaches the mark of 20 employees, it should not delay in starting the registration process with the PF department; otherwise, it might attract a penalty.

Regards,
KPS Consultants

KPS Consultants,

Thanks for the reply. Yes, we are going to register ASAP. But my original query was, do we consider the employees' salary at the time we register with the PF department or the salary at the time they joined the organization?