This new rule of EPFO became a headache for employees, more than 1,000 recruitments stuck in just 2 days!

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Employee future fund organization

The Employees Provident Fund Organization (EPFO) has made a big change in the process of creating and activating Universal Account Number (UAN) since 1 August 2025. Now UAN will only be released through UMANG app from face authentication technology (FAT). This rule is applicable to all new employees.

More than 1,000 recruitment stopped in two days

The Indian Staffing Federation (ISF) says that this change has immediately affected the recruitment process. Onboarding of more than 1,000 candidates stopped in just two days. This not only affected payroll, but also the PF contribution and other compliance deadlines were also in danger.

Big challenges in front of companies

According to the ISF, staffing companies have a higher number of temporary employees and joining and exit here. Personal participation of every employee is necessary in the FAT process, but many do not have a smartphone or reliable internet connection. This delays the formation of UAN, which directly affects salary payment and PF contribution, especially in areas with MSME and high turnover. Technical problems are also becoming a big problem. Failing face recognition, living server down or poor quality of cameras and networks, all these are making it difficult to apply FAT at the ground level.

Threat to compliance time limit

EPFO has set a deadline for Aadhaar linking and FAT till 30 June 2025. This deadline is a big challenge for companies managing thousands of employees. If there is no timely compliance, penalty may be imposed or PF contribution can be prevented, which will affect both the employer and the employee. ISF says that the Aadhaar of many employees is not updated mobile number or there is a difference in biometric. In such a situation, successful face authentication is not possible.

ISF suggested

Keeping in mind the objectives of EPFO, ISF has suggested some solutions.

  1. For the first time, employers should be allowed to make UAN from their portal so that PF registration can be done on time.
  2. Six months exemption for digital onboarding and fat awareness, so that companies can train employees and the process is easier.
  3. As before, the facility of making bulk UAN should be withdrawn without immediate fat or base seeding, so that PF contribution is not delayed.
  4. Dedicated support for fat related technical problems should be available and EPFO portal can handle high traffic.
  5. A partial discount or simple compliance process should be created for higher turnover industries and staffing companies.

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