Dear Sir(s),
If my employee has a basic salary of Rs.25,000/- PM and I am continously paying my company's provident fund contribution @ 12% i.e. Rs. 3000/- PM. While the employee himself is contributing Rs. 3000/- PM.
Can I reduce my company's contribution to the upper limit which presently is Rs. 1800/- PM max i.e. 12% of Rs. 15000/- PM according to the act, without taking any permission from anyone?
Please advise.
Regards,
Suresh J
From India, Nagpur
If my employee has a basic salary of Rs.25,000/- PM and I am continously paying my company's provident fund contribution @ 12% i.e. Rs. 3000/- PM. While the employee himself is contributing Rs. 3000/- PM.
Can I reduce my company's contribution to the upper limit which presently is Rs. 1800/- PM max i.e. 12% of Rs. 15000/- PM according to the act, without taking any permission from anyone?
Please advise.
Regards,
Suresh J
From India, Nagpur
Dear Colleague,
As long as you are complying with the PF coverage and deduction for Rs15,000/- then you are complying with the Provisions of Employees' Provident Fund Act 1952. The Law does not expect the employer to over do. It is mandatory to meet the required legal provisions. It is easy to implement for all new recruits.
But when it is implemented for any of the existing employees, then you are altering the terms of appointment which has to be done with mutual consent between the Employer and Employee concerned. If the said employees are " Workmen" under Industrial Disputes Act 1947, then you need to comply with 9A Notice provision and process. If the employees are not covered under Industrial Disputes Act 1947 as " Workmen" then you need to refix the terms of appointment by mutually entering a fresh contract of appointment with both sides' consent for the revised system of Provident Fund Contribution.
It is suggested to have abundant caution by consulting the PF Enforcement Officer concerned attached to the EPFO of your area.
From India, Chennai
309As long as you are complying with the PF coverage and deduction for Rs15,000/- then you are complying with the Provisions of Employees' Provident Fund Act 1952. The Law does not expect the employer to over do. It is mandatory to meet the required legal provisions. It is easy to implement for all new recruits.
But when it is implemented for any of the existing employees, then you are altering the terms of appointment which has to be done with mutual consent between the Employer and Employee concerned. If the said employees are " Workmen" under Industrial Disputes Act 1947, then you need to comply with 9A Notice provision and process. If the employees are not covered under Industrial Disputes Act 1947 as " Workmen" then you need to refix the terms of appointment by mutually entering a fresh contract of appointment with both sides' consent for the revised system of Provident Fund Contribution.
It is suggested to have abundant caution by consulting the PF Enforcement Officer concerned attached to the EPFO of your area.
From India, Chennai
PF contribution can be reduced to the statutory amount any time and it does not affect enforcement of the PF Act.
However, as Dr. Shivakumar explained, it may affect the terms of employment and the industrial dispute act
It is best if you get concurrence of the employee
But if the employee is not a worker, you have better flexibility.,
For the rest, consult a labour expert who can give you the answer with all the relevant facts of the case
From India, Mumbai
However, as Dr. Shivakumar explained, it may affect the terms of employment and the industrial dispute act
It is best if you get concurrence of the employee
But if the employee is not a worker, you have better flexibility.,
For the rest, consult a labour expert who can give you the answer with all the relevant facts of the case
From India, Mumbai
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Official gazatte notification for revision of ESIC contribution reduction July 2019 (1).pdf