The EPFO has introduced a separate ECR format for PF arrears remittance. The arrear ECR contains eight fields / data elements, such as arrear wages, employee share and employer share. To go through the arrear ecr first we have to understand between what is ECR and Arrear.
What is ECR?
ECR stands for Electronic Challan cum Return. It is an electronic monthly return to be uploaded by employers through the Employer e-Sewa portal. The approval of uploaded ECR will result in the generation of a Challan using which the employer has to remit the dues through online payment. The return will have the member wise details of the wages and contributions including basic details for the new and existing members (members who have joined or have left service in the wage month for which the return is uploaded).
What is Arrear ECR ?
Arrears are paid to compensate the salaries left, which should have been given earlier. Arrears come in to picture, when the employees gets salary hike in one month but receives the amount in some other month and the ECR is uploaded for that particular month with old wages. In such case, the company is due to its employees and the due amount which is paid in later date will have to make a ECR as arrear.
Calculation for Arrear ECR
Lets assume, this is January, 2020 and X’s salary is hiked from August, 2019 but the ECR already remitted for each month separately up to November, 2019. December month ECR is not uploaded as current month ECR is always uploaded before 15th of next month. In this case here employer have to upload a ECR file and a Arrear ECR file separately in the wage month of December, 2019.
X’s previous salary was Rs. 14,000 (which ECR already remitted) and in the month of January, 2020 employer declared that X’s salary of Rs. 5,000 will be increased/hiked from August, 2019 and X will be eligible to get the arrear salary.
So, in the month of January, 2020 the ECR amount will be Rs.19,000 (Salary Rs.14000 + hiked salary Rs.5000).
Now, as the employer already remitted the ECR for the period August, 2019 to November, 2019 with Rs.14000 each month separately, again can not be upload a ECR for that particular period of Rs.5000 (arrear amount) as employer can not upload a ECR for a particular month two times.
Hence, in this case employer has to make a arrear ECR of Rs.20,000 (Rs.5000 x 4 month).
Also Read: PF Admin Charges – A Detailed Explanation