Dear HR Professionals / Legal Advisors,
Are "Trainee" covered under the provisions of PF Act 1952.
The basic question arises whether the Trainee are recruited under Apprenticeship Act of 1961 or not.
In my opinion a Trainee appointed under Apprenticeship Act are exempted from PF Contribution rest all are covered under the provisions of PF Act.
Please advice
Regards
Prabhakar Srivastava
Pune
From India, Aurangabad
2Are "Trainee" covered under the provisions of PF Act 1952.
The basic question arises whether the Trainee are recruited under Apprenticeship Act of 1961 or not.
In my opinion a Trainee appointed under Apprenticeship Act are exempted from PF Contribution rest all are covered under the provisions of PF Act.
Please advice
Regards
Prabhakar Srivastava
Pune
From India, Aurangabad
Trainees engaged following the provisions of a certified Standing Orders of the company and the apprentices engaged following the provisions of Apprentice Act are excluded from the coverage of EPF whereas all other trainees are covered as if they are employees of the company. For ESI exemption only apprentices engaged under the Apprentices are excluded and those engaged under then provisions of Standing Orders are also covered.
Regards,
Madhu.T.K
From India, Kannur
Regards,
Madhu.T.K
From India, Kannur
Dear Prabhakar Srivastava,
Greetings for the day,
Trainees were consider as employee of an establishment, their appointment is under the provision of standing order, as far as apprentices are concern they are not an employee, so provision of EPF is only mandatory for salary which the trainees were getting, not on stipned which are provided for apprenticeship.
thanks & regards,
from,
sumit kumar saxena,
+91-9899669071
From India, Ghaziabad
Greetings for the day,
Trainees were consider as employee of an establishment, their appointment is under the provision of standing order, as far as apprentices are concern they are not an employee, so provision of EPF is only mandatory for salary which the trainees were getting, not on stipned which are provided for apprenticeship.
thanks & regards,
from,
sumit kumar saxena,
+91-9899669071
From India, Ghaziabad
Dear Sir,
I agree to what you have said.
Let me be little clear about my doubt.
I have appointed an MBA fresher as a "Management Trainee" and I am paying stipend of Rs 15,000.
As per the terms of his appointment letter he will be a trainee for 12 Months .
Will he be covered under provisions of PF Act 1952.
Please let me know the reference where can I get more clarification on this.
My interpretation of the definition of Employee as per section 2 (F) of PF Act is that these Management Trainees are liable for PF Contribution
"employee" means any person who is employed for wages in any kind of work, manual or otherwise, in or in connection with the work of [an establishment], and who gets his wages directly or indirectly from the employer,
[B][and includes any person
(i) employed by or through a contractor in or in connection with the work of the establishment;
(ii) engaged as an apprentice, not being an apprentice engaged under the Apprentices Act, 1961, or under the standing orders of the establishment];
Please clarify
Regards
Prabhakar
From India, Aurangabad
I agree to what you have said.
Let me be little clear about my doubt.
I have appointed an MBA fresher as a "Management Trainee" and I am paying stipend of Rs 15,000.
As per the terms of his appointment letter he will be a trainee for 12 Months .
Will he be covered under provisions of PF Act 1952.
Please let me know the reference where can I get more clarification on this.
My interpretation of the definition of Employee as per section 2 (F) of PF Act is that these Management Trainees are liable for PF Contribution
"employee" means any person who is employed for wages in any kind of work, manual or otherwise, in or in connection with the work of [an establishment], and who gets his wages directly or indirectly from the employer,
[B][and includes any person
(i) employed by or through a contractor in or in connection with the work of the establishment;
(ii) engaged as an apprentice, not being an apprentice engaged under the Apprentices Act, 1961, or under the standing orders of the establishment];
Please clarify
Regards
Prabhakar
From India, Aurangabad
I hope I have given the clarification in my previous post itself that all trainees other than apprentices engaged under Apprentice Act are covered by PF. In case you appoint Management Trainees, they are covered by EPF subject to their salary factor. If their salary, stipend or by whatever name it is described, is more than Rs 6500 then it is upto you whether to give coverage or not and if the practice of your company is not to cover any employee whose salary at the time of joining is more than Rs 6500 then you can exclude him. But if you have a salary bifurcation and with it if the Basic and DA total less than Rs 6500, naturally he will be covered even if his total/ gross salary exceeds Rs 6500.
To continue with the previous post, if you have a certifies Standing Order and if the orders contain provision for engagement of Management Trainees for one year, then also he can be excluded.
Regards,
Madhu.T.K
From India, Kannur
To continue with the previous post, if you have a certifies Standing Order and if the orders contain provision for engagement of Management Trainees for one year, then also he can be excluded.
Regards,
Madhu.T.K
From India, Kannur
Yes Mr. Madhu,
You are right. The Apprentices under Apprenticeship Act, 1962 and trainees included in Standing Orders are exempted from PF. Thanks Mr. Prabhakar Srivastava and others for sharing the case. Regards,
From India, Delhi
You are right. The Apprentices under Apprenticeship Act, 1962 and trainees included in Standing Orders are exempted from PF. Thanks Mr. Prabhakar Srivastava and others for sharing the case. Regards,
From India, Delhi
Dear All,
The Supreme Court has held that an apprentice or a trainee is not an employee and the employer is not liable to contribute Provident Fund for him or her.
A Bench, comprising Justice Arijit Pasayat and Justice R. V. Raveendran, held that trainees are apprentices engaged under the Standing Order of an organisation or under the Apprentices Act and will not come within the ambit of the Employees Provident Fund and Miscellaneous Provisions Act, 1952. The Bench noted that Section 2 (f) of the EPF Act "defines an employee to include an apprentice, but, at the same time, makes an exclusion in the case of an apprentice engaged under the Apprentices Act or under the Standing Orders. Under the Model Standing Orders an apprentice is described as a learner who is paid allowance during the period of training." Therefore, employers are not obliged to contribute to the PF for them.
The Bench, by its order, upheld a judgment of the Karnataka High Court rejecting the claim of 45 trainees of the Central Arecanut and Coca Marketing and Processing Co-op. Ltd, Mangalore, claiming PF payment. The Regional Provident Fund Commissioner (RPFC), Mangalore, had held that the trainees were employees for the purpose of the Act and the respondent was liable to pay the quantified amount.
The company challenged this order in the High Court and the court concluded that trainees were not employees as per the Act and reversed the RPFC's order.
Dismissing the appeal, the apex court held that "in the case at hand, trainees were paid stipend during the period of training. They had no right to employment, nor any obligation to accept any employment, if offered by the employer. Therefore, the trainees were apprentices engaged under the "Standing Orders" of the establishment. That being so, the view of the learned single judge as affirmed by the Division Bench of the High Court cannot be faulted."
From India, Mumbai
The Supreme Court has held that an apprentice or a trainee is not an employee and the employer is not liable to contribute Provident Fund for him or her.
A Bench, comprising Justice Arijit Pasayat and Justice R. V. Raveendran, held that trainees are apprentices engaged under the Standing Order of an organisation or under the Apprentices Act and will not come within the ambit of the Employees Provident Fund and Miscellaneous Provisions Act, 1952. The Bench noted that Section 2 (f) of the EPF Act "defines an employee to include an apprentice, but, at the same time, makes an exclusion in the case of an apprentice engaged under the Apprentices Act or under the Standing Orders. Under the Model Standing Orders an apprentice is described as a learner who is paid allowance during the period of training." Therefore, employers are not obliged to contribute to the PF for them.
The Bench, by its order, upheld a judgment of the Karnataka High Court rejecting the claim of 45 trainees of the Central Arecanut and Coca Marketing and Processing Co-op. Ltd, Mangalore, claiming PF payment. The Regional Provident Fund Commissioner (RPFC), Mangalore, had held that the trainees were employees for the purpose of the Act and the respondent was liable to pay the quantified amount.
The company challenged this order in the High Court and the court concluded that trainees were not employees as per the Act and reversed the RPFC's order.
Dismissing the appeal, the apex court held that "in the case at hand, trainees were paid stipend during the period of training. They had no right to employment, nor any obligation to accept any employment, if offered by the employer. Therefore, the trainees were apprentices engaged under the "Standing Orders" of the establishment. That being so, the view of the learned single judge as affirmed by the Division Bench of the High Court cannot be faulted."
From India, Mumbai
Dear All,
My understanding of law is that Apprentices under the Apprentices Act,1961 & Trainees, as engaged under the standing orders of an establishment,are excluded from the coverage under EPF Act.In your case, since you have been appointed on a salary exceeding the prescribed limit of Rs.6500/-and if you have not been a member of EPF earlier,you will not be liable for the benefits of the provident fund under the scheme as you will be termed as an 'Excluded employee'.The Excluded employees are categorized as under;-
(i) an employee who has been a member of the Fund, withdrew the PF accumulations from his accounts.
(ii) an employee whose pay at the time he is otherwise entitled to become member of the fund exceeds Rs.6500/- per month.
I hope the position is clear to you.
B S Kalsi
Contributing Member
From India, Mumbai
My understanding of law is that Apprentices under the Apprentices Act,1961 & Trainees, as engaged under the standing orders of an establishment,are excluded from the coverage under EPF Act.In your case, since you have been appointed on a salary exceeding the prescribed limit of Rs.6500/-and if you have not been a member of EPF earlier,you will not be liable for the benefits of the provident fund under the scheme as you will be termed as an 'Excluded employee'.The Excluded employees are categorized as under;-
(i) an employee who has been a member of the Fund, withdrew the PF accumulations from his accounts.
(ii) an employee whose pay at the time he is otherwise entitled to become member of the fund exceeds Rs.6500/- per month.
I hope the position is clear to you.
B S Kalsi
Contributing Member
From India, Mumbai
Dear Prabhakar,
Greetings for the day,
gone through the details cited by you, and it was noted that management trainee is appointed under the standing order and as the trainee is appointed he will be compensated with salary & wages instead of stipend.
Thanks & Regards,
From,
Sumit Kumar Saxena
From India, Ghaziabad
Greetings for the day,
gone through the details cited by you, and it was noted that management trainee is appointed under the standing order and as the trainee is appointed he will be compensated with salary & wages instead of stipend.
Thanks & Regards,
From,
Sumit Kumar Saxena
From India, Ghaziabad
Dear All,
It is clear that any person/employee who engaged under Apprenticeship Act,1961 are exempted under the E.P.F.Act, In continuation to this, any person or employee who engaged as trainee under the provision of Standing Order of establishment, are also excluded from the same.
Now, How we can examine or scrutinize whether any person or employee have been engaged under Standing Order or Under Apprentice Act? Some time they joined as regular trainee,learner,fresher in the same establishment but still they are not been member under the E.P.F.
Please explain how will get apprentice act certificate? How will get Provision of Standing Order? By whom will get authorization for the these exemption.
From India, Mumbai
It is clear that any person/employee who engaged under Apprenticeship Act,1961 are exempted under the E.P.F.Act, In continuation to this, any person or employee who engaged as trainee under the provision of Standing Order of establishment, are also excluded from the same.
Now, How we can examine or scrutinize whether any person or employee have been engaged under Standing Order or Under Apprentice Act? Some time they joined as regular trainee,learner,fresher in the same establishment but still they are not been member under the E.P.F.
Please explain how will get apprentice act certificate? How will get Provision of Standing Order? By whom will get authorization for the these exemption.
From India, Mumbai
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