Dear Friends,
Please clarify if the employer needs to deduct the PF on the notice pay that is given to the employee in lieu of the notice period.
Many thanks for your help and support.
Kind Regards,
Sonia
From India
5Please clarify if the employer needs to deduct the PF on the notice pay that is given to the employee in lieu of the notice period.
Many thanks for your help and support.
Kind Regards,
Sonia
From India
Hi, How can you deduct PF on notice pay, since it will consist of allowances other than basic and DA? PF is deduted only on Basic+DA. Regards, Harshad
From India, Mumbai
From India, Mumbai
Dear Harshad,
I believe what is conveyed is that PF is deductible on the basis of the notice pay payable to an employee when they exit from the organization.
I have another question regarding this - In case we are claiming notice pay from a leaver in lieu of not serving the required notice period, and the notice pay is equivalent to one month's gross salary rather than simply Basic + DA, under such circumstances, would the gross salary excluding the PF amount be claimed from the leaver?
Looking forward to your thoughts.
Many thanks,
Sonia
From India
I believe what is conveyed is that PF is deductible on the basis of the notice pay payable to an employee when they exit from the organization.
I have another question regarding this - In case we are claiming notice pay from a leaver in lieu of not serving the required notice period, and the notice pay is equivalent to one month's gross salary rather than simply Basic + DA, under such circumstances, would the gross salary excluding the PF amount be claimed from the leaver?
Looking forward to your thoughts.
Many thanks,
Sonia
From India
Hi,
Any income through your salary, the employer will deduct PF. So as in this case as well.
Secondly, any notice pay on either side is purely decided then & there in the Letter of appointment. Again, if notice pay has to be there, then PF must be deducted or recovered on it. In this case, for the next notice period, you can show the employee as on roll in PF challan as you have given a written clause in his appointment letter to pay him in case he leaves.
From India, Madras
Any income through your salary, the employer will deduct PF. So as in this case as well.
Secondly, any notice pay on either side is purely decided then & there in the Letter of appointment. Again, if notice pay has to be there, then PF must be deducted or recovered on it. In this case, for the next notice period, you can show the employee as on roll in PF challan as you have given a written clause in his appointment letter to pay him in case he leaves.
From India, Madras
Dear Sonia,
What I meant was in notice pay, PF is not applicable as the employee is not working in that period. It is applicable in both cases, in which we are paying notice pay or recovering it.
Regards,
Harshad
From India, Mumbai
What I meant was in notice pay, PF is not applicable as the employee is not working in that period. It is applicable in both cases, in which we are paying notice pay or recovering it.
Regards,
Harshad
From India, Mumbai
Hi Raul,
Thanks for your response; however, it was not clear. The employee would not make an income if the notice pay is claimed by the employer from the employee. Hence, I believe the employer should claim gross salary excluding PF (if PF is part of the gross salary) while claiming the notice pay.
Please comment.
Many thanks, Sonia
From India
Thanks for your response; however, it was not clear. The employee would not make an income if the notice pay is claimed by the employer from the employee. Hence, I believe the employer should claim gross salary excluding PF (if PF is part of the gross salary) while claiming the notice pay.
Please comment.
Many thanks, Sonia
From India
Dear Sonia,
The fact is, during the notice period in either case, the particular employee is not in the employment of the company. Therefore, no PF will be deducted. When we give or recover notice pay, we will pay or recover the full gross.
Regards,
Harshad
From India, Mumbai
The fact is, during the notice period in either case, the particular employee is not in the employment of the company. Therefore, no PF will be deducted. When we give or recover notice pay, we will pay or recover the full gross.
Regards,
Harshad
From India, Mumbai
Dear Harshad, Just to clarify - You mean to say that we pay / recover full gross salary and in either case do not submit anything to the PF Fund? Kind Regards, Sonia
From India
From India
Hi,
Please don't be confused. If it's stated in your appointment letter that the notice period must be recovered from an employee if they choose to leave without serving the notice period, then the fixed components of the gross monthly salary must be recovered from the employee, including PF. The PF amount will be submitted to the PF department, and vice versa.
From India, Madras
Please don't be confused. If it's stated in your appointment letter that the notice period must be recovered from an employee if they choose to leave without serving the notice period, then the fixed components of the gross monthly salary must be recovered from the employee, including PF. The PF amount will be submitted to the PF department, and vice versa.
From India, Madras
Hello,
My name is Srinu. I have some clarifications regarding PF. If an employee's salary consists of basic pay + DA of Rs. 8000/-, and he doesn't want to contribute to PF, is he exempted from making the contribution? What type of declaration should he provide to the employer?
Since the coverage of PF is for salaries up to Rs. 6500/-, please clarify this for me.
Thank you.
From India, Hyderabad
My name is Srinu. I have some clarifications regarding PF. If an employee's salary consists of basic pay + DA of Rs. 8000/-, and he doesn't want to contribute to PF, is he exempted from making the contribution? What type of declaration should he provide to the employer?
Since the coverage of PF is for salaries up to Rs. 6500/-, please clarify this for me.
Thank you.
From India, Hyderabad
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Notice of Employee Change.doc