SOP for PF inspections by EPFO

EPFO sets Standard Operating Procedure (SOP) for inspection of an establishment, vide internal web circular No. CAIU/SOP/2022/(E-47416)/2818, dated 31^st July, 2023.

Below is the gist:

• The Employees’ Provident Fund Organisation has clarified to all its field functionaries regarding the newly developed SOP for the inspection of an establishment and directed them to adhere to the said mechanism while conducting online or physical inspection of an establishment. The SOP promotes self-compliance and has a three-step inspection process.
• The three-step inspection process includes

1. a) Desk Review  
2. b) Nudging
3. c) Physical inspection
4. During the process of desk review, the EPFO would identify likely defaulting establishments by verifying available data in the system/ office records and establishes a priority matrix for selecting establishments for inspection. Desk review also includes verifying the data available with other agencies like ESIC, GSTN, MCA etc.
5. During the nudging process, identified defaulting establishments will be communicated through various means like email, SMS etc. to comply with the enactment.
6. Physical inspection will be carried out for the establishments that have not complied, despite the previous steps.

Key points from the SOP are as below:

1. Each field office shall undertake a Desk Review of all the active establishments starting from the oldest registration code within their jurisdiction, at least once a year.
2. During the nudging phase, the defaulted establishments will be given an opportunity to comply, and the list for physical inspection will exclude those establishments that have complied during the nudging phase.
3. After the completion of desk review and nudging, a physical inspection will be assigned to Enforcement Officer.
4. After the inspection, a report will be sent to the establishment on the registered e-mail ID.
5. In respect of establishments where insufficient data is found in system/office records, triangulation with readily available data from other agencies like ESIC/GSTN/MCA etc. may be undertaken, in order to ascertain the status of the establishment.
6. A mechanism has been created to send SMS & e-mail alerts to all defaulting establishments during the nudging phase, which will help the establishments to respond and comply to avoid physical inspection.
7. SMS alerts will be sent to all the members whose contribution is not deposited by the due date.

The above mechanism will be effective from 1st August 2023.

 The goal of the above SOP is to have a transparent and accountable inspection process and also to promote self-compliance, protect members’ right through a systematic and technology-driven approach.