Importance of statutory compliance in HR for an organization

 It is known that the scope of statutory compliance in an organization is limited to deducting taxes from employees' salary and paying it to the government. While it is not the only thing it does, it also ensures that the organization provides adequate benefits to employees as well.

firstly we learn about tax compliance and its importance in business. This needs to be further split into four parts: Withholding, Contributing, Remittance & Reporting.

Withholding: Every employer should follow certain tax rules as mandated by the respective agencies of the government in India, employee salaries are deducted towards Income tax, Provident fund, ESI, Professional Tax, and Labour Welfare Fund.

Contributing: Those above-mentioned deductions are made from the employees for their welfare. Each of these compliances is again governed by a set of rules and formulas.

Remittance:  Once deductions are done from the employees for the month, the employer has to make contributions and arrangements to remit them to the respective departments of the government. There are specific timelines & formats by when they need to be remitted and  Most of the remittances can now be done online through the banking system. 

Reporting: After deductions are made from the employees and remitted to the respective department in government, it is time for filling  ‘Returns’. It is a detailed report submitted by an organization to the respective government departments accompanying the remittances. It contains information on income paid to its employees and the taxes deducted.  Therefore the report should match the remittance made. Again, the respective returns are to be submitted as per specified timelines and formats.

Assessments & Internal Audits:

Authorized inspectors or enforcement officers of government departments are required to audit the remittances and returns for each completed year in order to check for any violations.    

Why WIN HRM Payroll?

Payroll and Statutory compliance in hr is a specialized subject and many prefer it to be managed by professionals due to constant changes in rules and also keeping in mind the adverse impacts of non-compliance. winhrmpayroll software helps you to manage the entire process seamlessly. our hr software support the computation of the right taxes, preparation of accurate reports/challans and link the system to government portals for remittances and filing of returns as well.

ESI Calculation |How to calculate esi calculation on salary in india?

 What is ESI?

ESI is defined as Employees state insurance (ESI) is a beneficial scheme for employees in India during their health-related problems. Employees' monthly contribution is deducted from employee and employer accounts as ESI Contribution.

As per ESIC rules, ESI deduction is applicable for employees at organizations with the strength of more than 10 persons and it is applicable for full-time employees and not for contract employees.

ESI Contribution is a type of social security for state employees, Deductions and calculations depend on the states of India.

How is esi calculation on salary is done?

Major parameters are 

1. Gross pay

2. DA(Dearness allowance)

3. Employment state

4. City compensatory allowance

ESI contribution is from both employee and employer as employee's contribution is 0.75 % of the gross salary whereas the employer's contribution is 3.25% of the gross salary of the employee.

A sophisticated HRMS solution can make ESI calculation and compliance management easier for the HR department and payroll department.

Advantages of attendance management software

Most of the organizations or companies feel difficulty in maintaining the attendance, timesheets manually. As the technology is developed many switched to the automated Online attendance management software which is more helpful and reduces the burden with more accuracy. Below are the advantages of using attendance management software

1. Accuracy 

Accuracy is very important to be maintained by the organization in terms of attendance, timesheet, Errors may occur with humans if we provide them with computer devices too, But an Automated attendance management system provides accurate time records, attendances and minimizes the errors.

2. Productivity/Efficiency

Managing and maintaining attendance manually is very difficult and time-consuming which takes time to process paper sheets and timesheets, scheduling, authorized leave, overtime, and creating payroll manually. with the automated system which does all the work that the administration does and reduces the burden of tracking the employee hours and importing information into the payroll system. Therefore time and effort are saved combined with data accuracy which leads to increased productivity and improves profits.

3. Security

Protecting the data of the employees is very important for every organization, Most attendance management software is highly secured. Specifically, biometric systems are highly secure and can prevent time theft, buddy punching, and reduce administrative costs stemming from forgotten PINs and lost ID cards

4. Real-time Tracking

A cloud-based attendance management system enables time tracking and provides inputs for payroll processing which helps in managing alternative payment schedules and makes all information available in real-time.

5. Flexibility

In this modern world, employees are choosing remote locations to work, These online attendance management system allow organizations to track employee time using a variety of clocking options, such as smartphones, internet networks, swiping technologies, biometric terminals, or desktop readers easily.

6. Visibility/Insights

With the attendance management software, one can get a clear insight of an employee like hours he worked, number of leaves, Overtime, and monthly reports. Customized reports are generated with any data and improve visibility and transparency within the organization.