I have recently joined a organization which do not cover employees above the Basic pay of 6500 under PF act. Planning to cover all employees under PF act with limiting the contribution to 780 towards PF irrespective of Basic in case basic is greater than 6500.
My query is that if an employee who is already a member of PF and his actual Basic is 10000 on which company is currently contributing 12% of Basic i.e 1200, In this case can the company reduce the contribution to 780 which is min.?
Looking forward for guidance.
From India, Mumbai
1My query is that if an employee who is already a member of PF and his actual Basic is 10000 on which company is currently contributing 12% of Basic i.e 1200, In this case can the company reduce the contribution to 780 which is min.?
Looking forward for guidance.
From India, Mumbai
You can do so. When an employer is deducting and depositing EPF upon more than Rs 6500, he can reduce it to the required percentage (ie, 12%) on Rs 6500 later on and in that event section 12 of the EPF Act providing bar on reducing wages will not attract. This has been held in the Supreme Court case, Marathwada Gramin Bank Karmachari Sanghatana and another Vs Management of Maratwada Gramin Bank and others (SC 2011 LLR 1130)
Madhu.T.K
From India, Kannur
Madhu.T.K
From India, Kannur
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PF query.doc
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