Widening the reach of its unique identity or 'Aadhar' system, Employees Provident Fund Organisation (EPFO) today mandated that all new salaried employees must submit Aadhar numbers before their companies can open a PF account for them.

An order issued by the new central provident fund commissioner Anil Swaroop has made it compulsory for all new members opening a PF account to provide Aadhaar details as their proof of identity.

The PF department circular says that a deadline for other existing members to provide their UID details would also be issued soon.

"UID linkage would ensure that money meant for workers actually reaches the worker, even if he is a casual worker who has worked in a place only for a few days," Swaroop said.

In a circular in November last year, the EPFO had complained that the organisation has been accepting bulk PF deductions of workers from companies - that is, payments of workers were bundled together and hence not specifically linked to a particular worker. These funds were decided arbitrarily on the basis of negotiations between the EPFO officials and employers.

The new order had condemned this practice and had asked for making payments against specific individual accounts only.

Swaroop's order takes this a step forward by asking for UID linkage to each account.

The circular has asked all the new members of the EPFO  to provide their Aadhaar details. The employer will be responsible for providing Aadhar card details of new members. Aadhar would now function as the main identification criterion for workers, the circular indicated.

The circular directs all the regional offices to contact their local UIDAI (Unique Identification Authority of India) officials to request for setting up Aadhaar enrolment camps.  

According to the circular, members joining the EPFO on or after 1 March 2013 will be required to provide their Aadhaar number.

The circular also directs that Aadhaar details of the present members should be collected by 30 June 2013.

The central government has already decided to link provident fund, pension scheme and other benefits covered by EPFO with the direct cash transfer scheme.

Under this, Aadhaar number will be necessary to withdraw PF and pension money.

The trouble with the EPFO's apparently progressive move, as critics point out, is that it is actually ad hoc and draconian, as the onus is on the employee to provide an Aadhaar number – and this is far from easy to get, with the penetration of the UID system being very limited so far.

The number of centres for enrollment to the Aadhaar scheme is utterly inadequate compared to the population base. In Mumbai, India's business and hence employment hub, the UID website shows that South Mumbai has just one centre for a population of about 3.5 million.