Employee Management

The employee master is the foundation of the HR & Payroll module in Udyamo ERP Lite. Every salary slip, statutory deduction, and payroll report traces back to an employee record. A well-maintained employee master — with accurate personal details, correct salary structure, and up-to-date statutory enrolment numbers — ensures that payroll runs smoothly, bank transfers reach the right accounts, and compliance filings are error-free.

This chapter explains the employee master concept, walks you through adding a factory worker with complete details, and documents every field on the employee form.

What You Will Learn

• Why a centralised employee master is essential for payroll
• How to record personal, employment, salary, and statutory details
• The Indian salary structure: basic, HRA, and allowances
• How statutory identifiers (PF, ESI, UAN, PAN, Aadhar) link to compliance
• The employee lifecycle: active, inactive, and terminated states
• Step-by-step creation of a new employee record

Prerequisites

• Udyamo ERP Lite account with access to the HR module
• Department and designation names defined in your organization
• Employee's personal documents: Aadhar card, PAN card, bank passbook or cancelled cheque
• Offer letter or appointment letter with salary breakup

The Employee Master Concept

In many small and mid-size manufacturing units, employee records live in registers, spreadsheets, or the memory of the HR person. Salary structures are recalculated every month from scratch. PF numbers are looked up from a separate file. Bank details are copied by hand. Each manual step introduces the risk of errors — a wrong account number delays salary credit, a missing PF number leads to compliance notices.

An employee master is a single, authoritative record for each person on your payroll. The salary module reads the employee's salary structure directly from this record when generating slips. The bank export module reads account number and IFSC code from the same record. Statutory deduction calculations reference the PF number, ESI number, and PAN stored here. One record, used everywhere, updated in one place.

Personal Details

The personal details section captures the employee's identity and contact information:

• First Name and Last Name -- The employee's legal name as it appears on identity documents. This name prints on salary slips and statutory filings.
• Date of Birth -- Required for age-related compliance checks and retirement date calculation.
• Email and Phone -- Used for sending payslips electronically and emergency communication.
• Aadhar Number -- The 12-digit unique identification number. Mandatory for EPF and ESIC filings. Employers must seed Aadhar with UAN for PF compliance.
• Address, City, State, Pincode -- The employee's residential address, used for Professional Tax state determination and correspondence.
• Emergency Contact Name and Phone -- Critical for manufacturing environments where workplace incidents require immediate notification of a family member or designated contact.

Tip: Collect and verify personal details during the onboarding process itself. Correcting Aadhar or PAN mismatches after payroll has run creates reconciliation headaches with EPFO and the Income Tax department.

Employment Details

Employment details define the employee's role and tenure within the organization:

• Employee Code -- A unique identifier assigned by your organization (e.g., EMP-001, FAC-0045). Use a consistent numbering convention across departments.
• Date of Joining (DOJ) -- The date the employee started work. This determines eligibility for statutory benefits, probation period calculations, and leave entitlements.
• Date of Leaving -- Populated only when an employee exits the organization. Leave blank for active employees.
• Department -- The functional area: Production, Quality, Maintenance, Stores, Packaging, Administration, etc.
• Designation -- The job title: Machine Operator, Production Supervisor, Quality Inspector, Maintenance Technician, Helper, etc.
• Employment Type -- Udyamo supports four types:
  • full_time -- Regular employees on the company payroll with full benefits.
  • part_time -- Employees working reduced hours, often with pro-rated benefits.
  • contract -- Fixed-term employees engaged through a contract for a specific period or project.
  • intern -- Trainees or apprentices, typically with a stipend rather than a full salary.

Salary Structure

Udyamo ERP Lite follows the standard Indian salary structure. The employee master stores the monthly salary breakup that is used as the default when generating salary slips:

• Basic Salary -- The core component of compensation. PF and gratuity are calculated as a percentage of basic salary. A common practice is to set basic at 40-50% of Cost to Company (CTC).
• HRA (House Rent Allowance) -- Typically 40-50% of basic salary. Employees living in rented accommodation can claim partial HRA exemption under Section 10(13A) of the Income Tax Act.
• Conveyance Allowance -- A fixed amount to cover commuting expenses.
• Medical Allowance -- A fixed amount towards medical expenses.
• Special Allowance -- A flexible component used to bridge the gap between the sum of structured components and the total gross salary.
• Other Allowance -- Any additional allowance specific to the role or organization, such as a shift allowance for factory workers on rotating shifts or a skill allowance for certified technicians.

Required: Basic salary must be entered accurately because PF and ESI deductions are calculated based on it. An incorrect basic salary will cascade into wrong deductions on every salary slip.

Statutory Enrolment

Indian labour law requires employers to enrol eligible employees in several statutory schemes:

• PF Number -- The Employee Provident Fund account number, assigned by the EPFO regional office. Format varies by establishment.
• UAN (Universal Account Number) -- A 12-digit number that remains with the employee for life, even if they change jobs. Multiple PF accounts (member IDs) can be linked under one UAN.
• ESI Number -- The Employee State Insurance number. Required for employees with gross wages up to Rs 21,000 per month.
• PAN (Permanent Account Number) -- Required for TDS on salary under Section 192 of the Income Tax Act.

Bank Details

Salary credit via bank transfer (NEFT/IMPS) requires accurate banking details:

• Bank Name -- The name of the employee's bank.
• Bank Branch -- The specific branch where the account is held.
• Account Number -- The bank account number for salary credit.
• IFSC Code -- The 11-character Indian Financial System Code used for electronic fund transfers.

Warning: Verify bank details against a cancelled cheque or bank passbook copy. A single digit error in the account number or IFSC code will cause the salary transfer to bounce or credit a wrong account.

Employee Lifecycle

An employee record in Udyamo has three status states:

• Active -- Currently employed and eligible for payroll processing. New employees start in this state.
• Inactive -- Temporarily not on the active payroll. Use this for employees on long leave, suspension, or sabbatical. Inactive employees are excluded from monthly payroll runs but their records are preserved.
• Terminated -- The employee has permanently left the organization. The date of leaving should be recorded. Terminated records are retained for historical reporting and statutory compliance but do not appear in active employee lists.

You can change an employee's status using the Toggle Active action on the employee record. To mark an employee as terminated, set the date of leaving and toggle the status to inactive.

Step-by-Step: Adding a New Factory Worker

This example adds a machine operator joining the production department of a manufacturing unit in Pune.

1. Navigate to HR > Employees from the main menu.
2. Click New Employee.
3. Fill in personal details:
   • First Name: Ramesh
   • Last Name: Jadhav
   • Date of Birth: 15-03-1990
   • Email: [email protected]
   • Phone: 9876543210
   • Aadhar Number: 1234 5678 9012
4. Fill in address details:
   • Address: Room 12, Shivaji Chawl, Bhosari
   • City: Pune
   • State: Maharashtra
   • Pincode: 411039
5. Fill in emergency contact:
   • Emergency Contact Name: Sunita Jadhav
   • Emergency Contact Phone: 9876543211
6. Fill in employment details:
   • Employee Code: FAC-0078
   • Date of Joining: 01-02-2026
   • Department: Production
   • Designation: Machine Operator
   • Employment Type: full_time
7. Enter the salary structure:
   • Basic Salary: 12000
   • HRA: 6000
   • Conveyance Allowance: 1600
   • Medical Allowance: 1250
   • Special Allowance: 3150
   • Other Allowance: 1000 (shift allowance)
8. Enter statutory details:
   • PF Number: PU/PNE/12345/678
   • UAN: 100987654321
   • ESI Number: 3100123456789
   • PAN: ABCPJ1234K
9. Enter bank details:
   • Bank Name: State Bank of India
   • Bank Branch: Bhosari Industrial Area
   • Account Number: 38912345678
   • IFSC Code: SBIN0005678
10. Add any notes: "Experienced on CNC lathe. Completed ITI from Pune."
11. Click Save.

The employee is now active and ready for salary slip generation. The salary structure entered here will be used as the default values when you create a salary slip for this employee.

Tips & Best Practices

Tip: Establish a consistent employee code convention before you start adding records. A common pattern for manufacturing units is a department prefix followed by a sequential number (e.g., PROD-001, QC-001, MAINT-001). This makes it easy to identify employees by department at a glance.

Tip: Review salary structures at the start of each financial year. When basic salary changes — due to increments or minimum wage revisions — update the employee master immediately so that subsequent salary slips pick up the correct values.

Warning: Never delete an employee record, even after termination. Historical salary slips, PF filings, and TDS certificates reference the employee master. Mark terminated employees as inactive with a date of leaving instead.

Tip: For contract workers with a fixed end date, record the contract end date in the Notes field. Set a reminder to either extend the contract or mark the employee as terminated on that date.

Quick Reference: Employee Fields