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What is HR Compliance ?

Created by - OD Mentors

What is HR Compliance ?

Human resources (HR) compliance is essential for any organization to be successful in today's legal environment. Companies are looking for HR professionals who are well versed with HR specific laws and can create policies and procedures in relation to these laws. Here are some online question and answers which can help you in your HR compliance job interview.Q.1What is a PF year?Provident Fund (PF) is actually a government-managed retirement savings scheme, as this enables the employees to contribute a part of their savings every month towards their retirement. Each year the PF accounting is done from March to February. This period is called as PF Year. This is only applicable to PF while, the other modules remain unaffected.Q.2Is it compulsory to contribute to PF?Ideally as of 2004 PF rules, all those employees who draw a PF Basic of less than rs. 15000, have to contribute to PF. Therefore this is mandatory for employees having PF Basic more than Rs. 15000, the deduction/contribution will be on 15000. Though, in most companies, PF is applicable to all employees. While very few exceptions are there i.e. the people who don't contribute to the PF.Q.3What is PF basic or PF gross?This is the amount on which the PF deduction is made or say PF contribution is calculated. Generally in 95% of the organizations this is Basic + Basic Arrears + DA + DA Arrears. However, there are always exceptions and some companies want it to be a little different. In that case, to cater to the client's requirements the PF Basic formula can be changed.Q.4What are the diverse options for PF form 10?Based o18:03 16/05/2019n either Leaving Date or Settlement Date form 10 can be generated. This can be set in the General Options. The option name is USE_SETTLEDATE_IN_FORM10. If you set this option to YES then the Form 10 report will list all employees who are settled in the given date range. Otherwise, it will pick up all employees who have resigned in the given date range.Q.5Is pf linked to income tax?If we analyze the Indian Tax laws, any contribution done by the employee towards PF can be considered for Section 88 rebate. In tradition, any deduction done for PF and VPF is automatically considered for Section 88 rebate in the Income Tax module.Q.6What are the various esi reports?Once a company employs 10 or more than 10 earning employees, and if any of them is earning less than 15,000 monthly then s/he has to contribute 1.75% of his or her income towards ESI. ESI Monthly report: this report is generated monthly. The main motive of generating this report is that it gives the total deductions/contribution of the employee and employer, done for each employee for a month. ESI Form 6: this is a bi-annual report. ESI Form 7: this is also a bi-annual report.Q.7Is pf linked to income tax?If we analyze the Indian Tax laws, any contribution done by the employee towards PF can be considered for Section 88 rebate. In tradition, any deduction done for PF and VPF is automatically considered for Section 88 rebate in the Income Tax module.Q.8What are the various esi reports?Once a company employs 10 or more than 10 earning employees, and if any of them is earning less than 15,000 monthly then s/he has to contribute 1.75% of his or her income towards ESI. ESI Monthly report: this report is generated monthly. The main motive of generating this report is that it gives the total deductions/contribution of the employee and employer, done for each employee for a month.ESI Form 6: this is a bi-annual report.ESI Form 7: this is also a bi-annual report.Q.9Suppose there is an employee who is making esi deduction from his monthly pay but his name is not appearing in the esi report. What could be the issue here?A field called an ESI Eligibility is considered by the ESI reports. As per the rules and process followed the name of an employee will display in the ESI report if marked as ESI Eligible in employee information.So you the employee needs to verify first if she is PF Eligible and ESI Eligible are selected in the Employee Information page of the application.Q.10What are the rates for contribution (deduction) to esi for both the employee and the employer?If you consider the employees first the, ESI deduction rate for employees' is 1.75% of the ESI Gross salary. While for the employer the, ESI contribution is at the rate of 4.75% of the ESI gross salary.Q.11What is ESI gross salary?Generally, all the income components paid to an employee is considered for ESI Gross computation. By tradition, the ESI Gross is defined by the user. User indicates which income components are to be considered for ESI Gross.Q.12What is family pension fund or Fpf or employee pension scheme or eps?The contribution made by an employer towards PF gets split into contribution towards PF and contribution to another scheme called Pension Scheme.

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Published - Fri, 11 Nov 2022

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