Dear Sir and all my seniors,
I want to know if the point of PF is to be paid on the minimum wages or if there are other considerations. Many security firms are paying PF based on the basic amount, which is less than the minimum wages. I also require a notification or copy of the rules regarding this issue.
I am waiting for a positive response.
From India, New Delhi
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36I want to know if the point of PF is to be paid on the minimum wages or if there are other considerations. Many security firms are paying PF based on the basic amount, which is less than the minimum wages. I also require a notification or copy of the rules regarding this issue.
I am waiting for a positive response.
From India, New Delhi
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Dear Mr. Ashok,
Greetings for the day :)
PF is always deducted on Basic. It doesn't matter whether it is higher or lower than minimum wages, but the gross pay should not be less than the minimum wages applicable in that particular industry or state.
From India, New Delhi
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Greetings for the day :)
PF is always deducted on Basic. It doesn't matter whether it is higher or lower than minimum wages, but the gross pay should not be less than the minimum wages applicable in that particular industry or state.
From India, New Delhi
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Dear Kapil,
Thank you for your reply. I heard during April 2005 that PF is based on basic wages but not less than the minimum wages. I would appreciate more comments on this from all seniors and any related notifications.
Ashok
9999618458
From India, New Delhi
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Thank you for your reply. I heard during April 2005 that PF is based on basic wages but not less than the minimum wages. I would appreciate more comments on this from all seniors and any related notifications.
Ashok
9999618458
From India, New Delhi
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Hi,
Minimum wages subject is different, and PF is different. Minimum wages can't be split. If you split, Basic and DA components should be as per Government minimum wages. Other components like HRA, CCA, and other allowances can be given apart from minimum wages. Hence, PF has to be paid on minimum wages. Minimum wages can't be split into a 60-40% break-up.
In practice, most companies follow the 60-40% break-up. No PF commissioner will provide in black and white support for splitting the minimum wages.
From India, Mumbai
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Minimum wages subject is different, and PF is different. Minimum wages can't be split. If you split, Basic and DA components should be as per Government minimum wages. Other components like HRA, CCA, and other allowances can be given apart from minimum wages. Hence, PF has to be paid on minimum wages. Minimum wages can't be split into a 60-40% break-up.
In practice, most companies follow the 60-40% break-up. No PF commissioner will provide in black and white support for splitting the minimum wages.
From India, Mumbai
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Ya. I agree. There has been judgment passed in the Supreme Court on the hearing of a union cadre that the PF has to be paid on the minimum wages and so minimum wages Thanks Poonam
From India, Delhi
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From India, Delhi
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Dear Poonam,
Greetings for the day:)
I want to inform you that a judgment can't be considered unless it has been amended in the act. Do you have any info about such an amendment or any section/rules which state it is a mandatory thing?
Judgments are appealable.
From India, New Delhi
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Greetings for the day:)
I want to inform you that a judgment can't be considered unless it has been amended in the act. Do you have any info about such an amendment or any section/rules which state it is a mandatory thing?
Judgments are appealable.
From India, New Delhi
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Dear Friend,
Greetings!
PF is payable on Basic Pay plus DA. Every employee whose Basic+DA is less than or equal to Rs. 6500/- at the time of joining the employment is compulsorily required to be covered under the Act. Others are not required mandatorily. A copy of the rule and definition is attached. Trust this meets your requirement.
Regards,
Sarath Chandra
Senior Manager
From India, Pune
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Greetings!
PF is payable on Basic Pay plus DA. Every employee whose Basic+DA is less than or equal to Rs. 6500/- at the time of joining the employment is compulsorily required to be covered under the Act. Others are not required mandatorily. A copy of the rule and definition is attached. Trust this meets your requirement.
Regards,
Sarath Chandra
Senior Manager
From India, Pune
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Dear Seniors,
In Tamil Nadu, we are facing the same kind of problems in factories (minimum wages split into basic and HRA, and PF deducted on basic + DA alone). Mr. Poonam, can you please post the Supreme Court judgment regarding this controversy? Some of the inspectors of factories and the social compliance auditors are saying PF has to be deducted on the minimum wages. However, when we ask for any mandatory rules from these Dy Chief Inspectors of Factories or Social Compliance Auditors, they do not have a clear idea, but they insist that what we are saying is correct and that you have to oblige.
In this case, can anyone post the relevant PF Commissioners' directions or any mandatory rules that will be useful for us?
Best Regards,
Subiah
From India, Madras
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In Tamil Nadu, we are facing the same kind of problems in factories (minimum wages split into basic and HRA, and PF deducted on basic + DA alone). Mr. Poonam, can you please post the Supreme Court judgment regarding this controversy? Some of the inspectors of factories and the social compliance auditors are saying PF has to be deducted on the minimum wages. However, when we ask for any mandatory rules from these Dy Chief Inspectors of Factories or Social Compliance Auditors, they do not have a clear idea, but they insist that what we are saying is correct and that you have to oblige.
In this case, can anyone post the relevant PF Commissioners' directions or any mandatory rules that will be useful for us?
Best Regards,
Subiah
From India, Madras
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Thank you for your interest in my issue. I believe that this deduction should not be lower than the minimum wage, as many companies are currently paying below the minimum wage. Therefore, I seek clarification and justification from the EPF or the labor department.
From India, New Delhi
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From India, New Delhi
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Dear All, Please find attached the copy of PF notification which is issued by PF Dept., there is clearly mentioned that the PF is applicable on minimum wages.
From India, Delhi
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From India, Delhi
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Do you know section regarding not being a member of pf whose salary more than 6500 from DOJ? and another things is that is ESIC compulsory for construction company?
From India, Ahmadabad
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From India, Ahmadabad
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Hi,
I have 2 queries which I am facing regarding the handling of the housekeeping 3PL of my company.
1. The 3PL service provider divides the minimum wages into a 60-40% breakup: 40% Basic+D.A and the remaining 60% into HRA, Washing Allowance, and Conveyance. The gross amount, however, ends up being slightly higher than the minimum wages specified in the minimum wages act in Bengal. The 3PL claims that since they are providing a gross amount higher than the minimum wage, they are distributing it this way. When I inquired why this practice is being followed, they referred to a Supreme Court verdict that supposedly mentions this. However, upon reviewing the verdict, I could not find any clear mention of this practice. Please find the attachment of the verdict for your reference.
2. My next query pertains to bonus payment. Are we, as the principal employer, obligated to pay statutory bonuses to the service provider? Based on my research, if this obligation is not explicitly stated in the agreement, then we are not required to make such payments. Our company does not have any agreement with this service provider. They were unable to provide any valid documentation supporting their stance, except mentioning that other companies have agreed to the same.
Please respond to this issue!
Thanks,
Nivedita Mahapatra
From India, Delhi
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I have 2 queries which I am facing regarding the handling of the housekeeping 3PL of my company.
1. The 3PL service provider divides the minimum wages into a 60-40% breakup: 40% Basic+D.A and the remaining 60% into HRA, Washing Allowance, and Conveyance. The gross amount, however, ends up being slightly higher than the minimum wages specified in the minimum wages act in Bengal. The 3PL claims that since they are providing a gross amount higher than the minimum wage, they are distributing it this way. When I inquired why this practice is being followed, they referred to a Supreme Court verdict that supposedly mentions this. However, upon reviewing the verdict, I could not find any clear mention of this practice. Please find the attachment of the verdict for your reference.
2. My next query pertains to bonus payment. Are we, as the principal employer, obligated to pay statutory bonuses to the service provider? Based on my research, if this obligation is not explicitly stated in the agreement, then we are not required to make such payments. Our company does not have any agreement with this service provider. They were unable to provide any valid documentation supporting their stance, except mentioning that other companies have agreed to the same.
Please respond to this issue!
Thanks,
Nivedita Mahapatra
From India, Delhi
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Supreme court is highest authority for judicial purpose but amendment always done by passing it from both the houses
From India, New Delhi
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From India, New Delhi
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Dear all,
Please find enclosed the judgment of the Karnataka High Court, which resembles the above case. In this matter, the High Court opined that the PF commissioner has the power to see whether the minimum wages were bifurcated with a view to subterfuge PF contributions and penalize the companies that adopt such practices.
Hope this will be useful.
From United States
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Please find enclosed the judgment of the Karnataka High Court, which resembles the above case. In this matter, the High Court opined that the PF commissioner has the power to see whether the minimum wages were bifurcated with a view to subterfuge PF contributions and penalize the companies that adopt such practices.
Hope this will be useful.
From United States
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Dear Ashok,
I do agree with your comments. Let's understand Minimum Wage (MW). MW should consist of Basic & DA combination; you cannot split MW into many parts. If MW comprises Basic & DA, then it automatically attracts PF on it.
From India, Chennai
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I do agree with your comments. Let's understand Minimum Wage (MW). MW should consist of Basic & DA combination; you cannot split MW into many parts. If MW comprises Basic & DA, then it automatically attracts PF on it.
From India, Chennai
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Dear All Pls find enclosed the Judgment of Supreme Court stating that Minimum Wage is one packet of payment and cano/should not be bifurcated. regardsr ravi
From United States
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From United States
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Dear All,
In the PF Act, nothing is mentioned regarding minimum wages for the purpose of PF contribution. PF is deducted on basic pay + DA, and the ceiling for such contribution is Rs 6500/-.
No judgment can automatically become a part of the Act unless the Act is amended to incorporate the judgment.
Kalyan Mitra
From India, Calcutta
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In the PF Act, nothing is mentioned regarding minimum wages for the purpose of PF contribution. PF is deducted on basic pay + DA, and the ceiling for such contribution is Rs 6500/-.
No judgment can automatically become a part of the Act unless the Act is amended to incorporate the judgment.
Kalyan Mitra
From India, Calcutta
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The PF contribution has to be paid on the minimum wages irrespective of the naming words. For example, Basic, DA, HRA, and so on. However, beyond minimum wages, the PF may be voluntarily contributed.
Thanks, Poonam
From India, Delhi
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Thanks, Poonam
From India, Delhi
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Hi Sunder, You are right so this makes clear that the PF has to be calculated on the minimum wages. This is what I had conveyed in my last post. Have a good day. Poonam
From India, Delhi
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From India, Delhi
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Circular from PF HO on splitting of wages for the purpose of PF is not permissible, as per circular No. Coord/4(6)/2003/clarification/vol-II/7394 dated 23.5.2011.
Ramalingeswara Rao
Sr. Manager (HR)
Hyderabad
From India, Secunderabad
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Ramalingeswara Rao
Sr. Manager (HR)
Hyderabad
From India, Secunderabad
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hello pf is always deducted on the basic salary and it also differs from state 2 state with regards
From India, Chennai
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From India, Chennai
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Dear All,
We all discuss PF deductions on Basic/DA (MW). But now, in Ambattur, factories are instructed to deduct PF on components other than HRA, including attendance bonus. For example, if a worker receives a wage of 5500.00 (Basic + DA: 3300, HRA 1500, other allowances 700), the factories are instructed to deduct PF for 4000, and the attendance bonus, which varies from month to month.
Please clarify if this is correct.
From India, Madras
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We all discuss PF deductions on Basic/DA (MW). But now, in Ambattur, factories are instructed to deduct PF on components other than HRA, including attendance bonus. For example, if a worker receives a wage of 5500.00 (Basic + DA: 3300, HRA 1500, other allowances 700), the factories are instructed to deduct PF for 4000, and the attendance bonus, which varies from month to month.
Please clarify if this is correct.
From India, Madras
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Dear Seniors,
As ordered by the Provident Fund Commissioner, Haryana does not specify minimum wages separately, but under the definition of minimum wages, Basic + HRA equals MINIMUM WAGES. Please explain how the PF Commissioner can change the definition of minimum wages under the Act.
Regards,
Ram
From India, Delhi
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As ordered by the Provident Fund Commissioner, Haryana does not specify minimum wages separately, but under the definition of minimum wages, Basic + HRA equals MINIMUM WAGES. Please explain how the PF Commissioner can change the definition of minimum wages under the Act.
Regards,
Ram
From India, Delhi
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Dear All, Please give me PF circular for excluded employees i.e whose basic salary is higher than 15000/-. Please reply .
From India, Phursungi
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From India, Phursungi
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Dear All, Please give me PF circular for excluded employees i.e whose basic salary is higher than 15000/-. Please reply .
From India, Phursungi
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From India, Phursungi
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Does anyone have an idea about the Supreme Court notification or judgment regarding the splitting of minimum wages for PF in 2015 for Haryana? If you have any solution, please call or email the information regarding this to Mob. 8287152129 or E-mail ID: raiab201@gmail.com.
Thanks and Regards,
Abhishek Rai
From India, New Delhi
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Thanks and Regards,
Abhishek Rai
From India, New Delhi
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Splitting of minimum wages for PF in abeyance (1).pdf
Minimum Wages, ESI & PF.pps