Question 1

When must PF contributions be deposited?

Accepted Answer

PF contributions must be deposited by the 15th of the following month. For example, February contributions must be deposited by March 15. Late payment attracts interest at 12% per annum on the defaulted amount, plus damages ranging from 5% to 25% depending on the period of delay.

Question 2

What is the UAN and how does it work?

Accepted Answer

UAN (Universal Account Number) is a 12-digit number allotted to every employee covered under PF. It remains the same throughout the employee career regardless of job changes. Employers must activate the UAN for every new employee and link it to their Aadhaar, PAN, and bank account. The employee can then track their PF balance, withdraw funds, and transfer PF from previous employers through the EPFO member portal.

Question 3

Can an employee withdraw PF before retirement?

Accepted Answer

Yes, in certain circumstances: partial withdrawal for housing loan repayment, medical treatment, marriage, education, or home purchase after a minimum service period; full withdrawal on retirement (age 58+) or after 2 months of unemployment; and advance from PF during COVID or natural calamity situations. Withdrawals before 5 years of continuous service are taxable.

Question 4

What benefits does ESI provide to employees?

Accepted Answer

ESI provides: free medical treatment at ESIC hospitals and dispensaries for the employee and their dependents, cash benefits during sick leave (70% of salary for 91 days per year), maternity leave benefits (26 weeks at full wages), disability pension for permanent disability, and dependent benefits to the family in case of death due to work injury.

Question 5

Is PF contribution applicable to contractual workers?

Accepted Answer

PF is applicable to employees on the payroll of the establishment, including those on fixed-term contracts or probation. Workers engaged through contractors are covered under the principal employer obligation — if the contractor fails to register and contribute, the principal employer is liable.

Question 6

What are the penalties for not registering for PF or ESI?

Accepted Answer

For PF non-registration: all arrears must be paid with interest at 12% per annum plus damages of 5–25%, and prosecution under Section 14 of the EPF Act can lead to imprisonment up to 3 years. For ESI non-registration: all unpaid contributions plus interest at 12% per annum, and penalties under Section 85 of the ESI Act can lead to imprisonment up to 3 years.

Question 7

Are directors covered under PF and ESI?

Accepted Answer

Working directors who draw a salary from the company are treated as employees and are covered under PF and ESI if their salary is within the respective thresholds. Non-executive directors who do not draw a regular salary are not covered. Sole proprietors are not covered as they are not employees of their own establishment.

Question 8

What are the PF and ESI monthly filing requirements?

Accepted Answer

PF: File ECR (Electronic Challan cum Return) by the 15th of every month showing employee-wise PF contribution details. ESI: File monthly contribution challan by the 21st of the following month. Both require accurate employee-wise records of salary, contribution calculated, and amount deposited. Annual PF returns must be filed by April 30.

PF and ESI Registration for Employers in India — Complete Guide

Who must register for PF and ESI?

PF contribution rates explained

How to register online for PF and ESI

Frequently Asked Questions

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