Navigating COVID-19 Salary Arrears: Are We Eligible for PMGKY Benefits and How to Proceed?

Dear All,

Our company is a private limited entity falling under the purview of the Shop and Establishment Act. Amidst the challenges posed by COVID-19, we have disbursed 70% of the gross salary to our employees. Some of our employees, particularly those in the sales category, receive fixed daily traveling expenses, which are paid monthly and included in the gross salary calculation. In March 2020, we were deemed ineligible for the PMGKY benefit. Due to the restrictions on travel during the pandemic, we refrained from paying and reflecting the gross salary inclusive of the travel expenses. However, from April to August, we did benefit from the scheme and duly remitted ESI and EPF contributions.

In October 2020, the management made the decision to provide a 30% arrear salary. My query pertains to the EPF and ESI deductions applicable to this arrear amount. Additionally, I seek clarification on whether we are entitled to avail the PMGKY benefit for this arrear payment as well. If we are eligible, could you please guide on the process of generating GRN on the respective site?

Thanks in advance.

EPF and ESI Deductions for Arrear Salary:

For the arrear salary provided in October 2020, EPF and ESI deductions should be calculated based on the arrear amount. Both EPF and ESI contributions are applicable to arrears as they are part of the overall salary package. Ensure that the deductions are computed accurately to comply with the respective statutory requirements.

Eligibility for PMGKY Benefit on Arrear Payment:

Regarding the PMGKY benefit for the arrear payment, it is essential to review the specific guidelines outlined under the scheme. Generally, the PMGKY scheme aims to provide relief to employers and employees during the COVID-19 crisis. To determine eligibility for availing the PMGKY benefit for arrears, refer to the official notifications and guidelines issued by the government.

Process for Generating GRN:

1. Visit the official portal related to EPF and ESI contributions.
2. Log in using your credentials.
3. Navigate to the section for generating GRN (Group Reference Number).
4. Enter the required details accurately, including the arrear amount and relevant employee information.
5. Verify the information provided before submitting the request.
6. Once the GRN is generated, ensure timely payment of EPF and ESI contributions for the arrear amount.

Additional Considerations:

- Consult with a legal or financial advisor to ensure compliance with labor laws and regulations.
- Keep detailed records of all salary disbursements, deductions, and contributions for future reference.
- Stay updated on any changes in government schemes or policies that may impact payroll processing during the pandemic.

By following these steps and guidelines, you can effectively manage EPF and ESI deductions for arrear salary while exploring the eligibility for the PMGKY benefit.