EPF & ESIC Registration: Social Security for Employees
The Employees' Provident Fund (EPF) and Employees' State Insurance Corporation (ESIC) are two major social security schemes in India that provide financial protection and healthcare benefits to employees. EPF ensures retirement savings while ESIC provides medical care and cash benefits during sickness, maternity, and employment injury.
This comprehensive guide covers everything employers need to know about registering for EPF and ESIC, contribution calculations, monthly compliance, and employee benefits.
EPF (Employees' Provident Fund)
EPF is a retirement benefits scheme managed by the Employees' Provident Fund Organisation (EPFO) under the Ministry of Labour:
- • Mandatory for establishments with 20+ employees
- • Applies to employees with basic salary up to ₹15,000
- • Employees can voluntarily join even above ₹15,000
- • Contribution: 12% from employee, 12% from employer
- • Accumulated amount with interest paid at retirement
- • Partial withdrawals allowed for specific purposes
EPF Contribution Breakdown
| Employee Contribution (12%) | Goes entirely to EPF |
| Employer Contribution (12%) | 3.67% to EPF + 8.33% to EPS |
| EDLI & Admin Charges | 0.5% + 0.5% (employer pays) |
ESIC (Employees' State Insurance)
ESIC provides social security and health insurance to employees in the organized sector:
- • Mandatory for establishments with 10+ employees (20+ in Maharashtra)
- • Applies to employees with gross salary up to ₹21,000
- • Contribution: 0.75% from employee, 3.25% from employer
- • Cash benefits during sickness, maternity, disability
- • Medical care for self and family at ESIC hospitals
- • Dependent benefits in case of employment injury
ESIC Benefits
- • Sickness benefit: 70% wages for 91 days
- • Maternity benefit: 100% wages for 26 weeks
- • Disablement benefit: Monthly pension
- • Dependent benefit: Pension to family
- • Medical benefit: Free treatment at ESIC hospitals
- • Unemployment allowance: Under Rajiv Gandhi Shramik Kalyan Yojana
Applicability Criteria
EPF Applicability
- • Factories with 20+ employees
- • Other establishments with 20+ employees
- • Central/State government notified establishments
- • Voluntary coverage possible with 10+ employees
- • Applies to employees with basic salary ≤ ₹15,000
ESIC Applicability
- • Factories with 10+ employees (20 in Maharashtra)
- • Shops with 10+ employees
- • Hotels and restaurants
- • Cinemas and road transport
- • Applies to employees with gross salary ≤ ₹21,000
Registration Process
Check Applicability
Count your employees and check salary limits. Determine if EPF (20+ employees) and/or ESIC (10+ employees) applies to your establishment.
Gather Documents
Collect company PAN, registration certificate, address proof, bank details, and employee information (name, DOB, salary, Aadhaar, PAN).
EPF Registration
Register on epfindia.gov.in or Shram Suvidha Portal. Fill establishment details, upload documents, and submit. Receive EPFO code and establishment ID.
ESIC Registration
Register on esic.in. Create employer login, fill IP-1 form with establishment details, upload documents. Receive ESIC employer code number.
Add Employees
For EPF: Add employees through ECR portal, generate UAN for each employee. For ESIC: Register employees as IPs (Insured Persons), generate IP numbers.
Start Monthly Compliance
Generate monthly challan by 15th, pay contributions online, file monthly returns. Ensure timely compliance to avoid penalties.
Monthly Contribution Calculation
Example Calculation (Employee with ₹20,000 Basic Salary)
| Component | EPF | ESIC |
|---|---|---|
| Salary Considered | ₹15,000 (capped) | ₹20,000 (full) |
| Employee Contribution | ₹1,800 (12%) | ₹150 (0.75%) |
| Employer Contribution | ₹1,800 (12%) | ₹650 (3.25%) |
| Total Monthly | ₹3,600 | ₹800 |
Monthly Returns and Compliance
EPF Monthly Return (ECR)
- • Generate Electronic Challan cum Return (ECR)
- • Upload by 15th of following month
- • Payment through net banking
- • Update employee exits/joins
- • UAN activation for new employees
ESIC Monthly Return
- • Generate monthly challan online
- • File by 15th of following month
- • Payment through SBI or other banks
- • Update employee joins/exits
- • Register new employees as IPs
Penalties for Non-Compliance
| Violation | EPF Penalty | ESIC Penalty |
|---|---|---|
| Late Payment | 5% p.a. interest | 12% p.a. interest |
| Non-Payment | 5-25% damages | Prosecution possible |
| Late Return | ₹200 per day | ₹500 per day |
Common Compliance Mistakes
Wrong Salary Calculation
EPF is calculated on basic salary only, not gross. ESIC is calculated on gross salary. Don't mix these up.
Missing Deadlines
15th of the month is the deadline for both EPF and ESIC payments. Mark your calendar and set reminders.
Not Updating Exits
Promptly update exits when employees leave. Otherwise, you'll continue paying contributions.
UAN (Universal Account Number)
UAN is a 12-digit number assigned to each EPF member:
- • Portable across jobs and locations
- • Links multiple PF accounts
- • Employees can check balance online
- • Withdrawal requests through UAN portal
- • KYC (Aadhaar, PAN, Bank) must be linked
Tip: Ensure all employees activate their UAN and link KYC for seamless service.
Employer Compliance Checklist
Registration Phase
- ✓ Obtain EPFO code (if 20+ employees)
- ✓ Obtain ESIC code (if 10+ employees)
- ✓ Generate UAN for all employees
- ✓ Issue ESIC cards to employees
Monthly Compliance
- ✓ Generate challan by 15th
- ✓ Pay contributions on time
- ✓ Update exits and new joins
- ✓ File monthly returns