Understanding EPF Sub-Codes: How Can Small Contractors Ensure Compliance?

Vijay HRM
Hi friends, this is Vijay, seeking help to learn more about the EPF sub-code. Is there any provision to get a sub-code under the main EPF code which will help to ensure compliance of various small-size contractors who are unable to maintain the same as per requirements?
praveen446
Hi Vijay, you will receive only one EPF code. For contractors, you can generate different ECRs for accounting purposes. This will help both the principal employer and the contractor.
drsivaglobalhr
Dear Colleague,

There is a main code for each establishment for remittance and compliance of PF by the employer. The employer can get sub-codes under the establishment code if located in a different state for easy compliance, and EPFO is allotting such sub-codes also.

Sub-Codes for Contractors

In the case of a sub-code for compliance in the case of contractors, it can also be obtained, but it is highly discouraged. This is because you will end up managing entire activities like remittance, inspections, accounting, settlements, transfers, and so on, including 7A enquiries, etc. This will add too much burden. It is always important to ensure that contractors do their own compliance and you put them into your audit radar. Legally create them as separate establishments with Contract License, PF Code, ESI Code, etc., as it will be a separate entity and will protect the interest of the organization in the long run in many ways. In several of my previous organizations, we faced lots of challenges due to compliance under sub-code on behalf of contractors and notices received even after a few years of the leaving of contractors. Approach this as a "Let them do their job" manner and improve your audits on them. This is my suggestion from a practical point of view, and you may kindly make a suitable call after weighing the pros and cons.
S. KUMAR
Understanding the EPF Sub-Code for Contractors

The sub-code for a contractor is like an 'AA' ball hitting me. Contractors may have other contracts; what about compliance regarding that organization? After the termination of your contract, if they do not maintain compliance, then who will bear the consequences? Before going for the sub-code, you must consider its implications carefully.

Regards, S. Kumar
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