The coverage of Employees Provident Fund Organization (EPFO) is spread across the country. Its scope includes more than 3 lakh 90 thousand establishments and more than 3.9 crore EPF subscribers. Its total collection is Rs 1.39 lakh crore. EPFO has taken several organizational reform steps since June 2001 to improve the services provided to employers and subscribers. The reforms initiated include launch of UAN numbers for customers, allotment of Social Security Numbers and LIN numbers to employers, implementation of member portal, linking of Aadhaar with UAN numbers of customers, uploading of KYC documents related to UAN numbers, e-passbook, Members got the facility to operate their own PF accounts, along with many other facilities including e-nomination, tax on contributions etc.
Employees Provident Fund Organization has 27 divisions, which include International Staff, Rules, Information Services, Compliance, Audit etc., which will work for its purpose and improvement. Around 2127 circulars have been published by EPFO in the last 5 years. In the last 5 months alone, 146 circulars have been published by EPFO. Most circulars or notifications are not relevant to every establishment or customer, but it is important to know the changes or information shared by EPFO and decide its relevance to the establishments or customers or employers.
EPFO reforms and changes in rules, e-nomination, KYC, international labor employment, member portal, permission to modify subscriber’s data, interest rates, tax on contributions and other compliances are required to be implemented, which are required to analyze the impact and Based on expertise in the field of compliance to guide relevant stakeholders in remaining compliant.
The changes notified in the regulations by EPFO have to be implemented within a stipulated time frame. It is important to comply with every change within the stipulated time period. Failure to comply within the stipulated time will be treated as non-compliance and will attract penal consequences for non-compliance. Any unknown mistakes or errors made by the employers will also impact the reputation of the employers. Errors in the process or misguidance will make employers financially liable and changes are being made by EPFO to initiate action against employers.
A good organization is always compliant and alert about compliance-related changes. Employers are responsible for tracking the changes, analyzing the impact of each circular or notification. The employer is required to inform subscribers about the nature of the changes affecting them.
Today, attention is being given to reducing costs everywhere, and thus every organization tries to get more profit at less cost. In this situation, it would be time-consuming and expensive for an organization to devote resources to identifying the relevant changes in the circulars issued by EPFO and preparing reports on the impact of each change.
Most employers prefer to outsource EPF compliance to remain compliant. Third party agencies take complete care of the compliances to avoid complications by tracking changes, implementation, advice, notes on changes, FAQs to help stakeholders, training resources and supporting the subscriber in remaining employer compliant.
Taking the help of a third party makes it easier to list the services provided. The benefits to employers of timely information about changes in regulations include optimizing costs involved, reducing time to deliverables, ensuring quality of delivery, and confidence in data confidentiality. Skilled staff equipped with third party knowledge and adequate experience helps the employer remain compliant on all aspects.
For employers to remain compliant, they must have internal resources with the necessary capacity to take timely decisions on changes and implementation of EPFO rules, so that they can deploy them as and when required. Third party outsource is another option to remain compliant while maintaining optimal cost and risk-free.