To start providing Provident Fund (PF) and Employee State Insurance (ESI) benefits to employees in a company already registered under these schemes in India, specifically in Bengaluru, you need to follow these steps:
Provident Fund (PF) Process:
🔍 Ensure that all eligible employees are enrolled in the PF scheme.
🔍 Calculate the PF contribution based on the employee's basic salary and dearness allowance (DA). The current contribution rate is 12% of the basic salary and DA.
🔍 Deduct the employee's share of PF contribution from their salary and contribute the employer's share as per the rules.
🔍 File monthly PF returns and make timely payments to the PF authorities.
🔍 Issue PF slips to employees reflecting their contributions.
Employee State Insurance (ESI) Process:
🔍 Verify the eligibility of employees for ESI coverage based on their salary.
🔍 Calculate the ESI contribution, which is currently set at 1.75% of the employee's gross salary, while the employer's contribution is 4.75%.
🔍 Deduct the employee's share of ESI contribution and contribute the employer's share.
🔍 Register eligible employees for ESI benefits and provide them with the necessary documentation.
🔍 File ESI returns and make contributions within the specified timelines.
Fixing Basic and DA for PF and ESI:
🔍 Basic salary and DA are crucial components for calculating PF and ESI contributions.
🔍 Ensure that the basic salary and DA are in compliance with minimum wage laws and industry standards.
🔍 Any revisions to the basic salary and DA should be done in accordance with legal requirements and after informing employees.
Deductions for PF and ESI:
🔍 Deduct the employee's share of PF and ESI contributions as per the prescribed rates.
🔍 Clearly communicate the deductions to employees through their salary slips.
🔍 Ensure that the deductions are accurately reflected in the payroll and comply with statutory requirements.
By following these steps diligently and ensuring compliance with labor laws and regulations, your company can effectively start providing PF and ESI benefits to employees already covered under these schemes.