PF and ESI Registration is compulsory for the companies having more than 20 employees. Also Companies having less than 20 employees can register voluntarily.
Employee state insurance (ESI) managed by Employee State Insurance Corporation is for Indian workers. It provides medical and other benefits to employees. It is mandatory for any company having more than 20 employees whose maximum salary Rs. 21000/- per month.
Employees Provident Fund is under the purview of Employees’ Provident Fund Organization (EPFO) which is regulated by Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. EPF benefits workers during the retirement. Any registered company continues to be under the purview of the Act even if the workers strength falls below 20. Central Government may apply the provisions EPF Act to any establishment employing less than 20 workers after giving minimum two months’ notice for compulsory registration.
All the employees are eligible for EPF registration from the start of their employment. The responsibility of deduction & payment of PF is with the employer. The PF contribution of 12% of basic salary of the employee should be divided equally between the employer and employee. If the company less than 20 employees, PF deduction rate is 10% of basic salary.
Both PF and ESI registration is done in shram suvidha portal which is developed to increase the compliance and transparency.