The PF contribution is 12% of Basic salary from both employee and employer. For the calculation the maximum limit of Basic is Rs 6500/-. It means even if the employee's basic salary is above Rs 6500/- the employer is liable to contribute only on the Rs 6500/-, that is Rs 780. However if an employee so desires he may voluntarily contribute more than 12%. Apart from it an employer also has to pay some administration charges. (say about 13.61%)
It is applicable to establishments employing 20 or more persons and engaged in any of the 180 industries / Classes of Businesses specified.
Co-operative Societies, employing 50 or more persons & working without the aid of power. Some sectors are exempted who have their own Fund to pay on retirement of the employee, which are exempted from the Act.
HOWEVER there are also some firms who are registered for PF in other states and making the Ministry of Labour, GoI, as clean fools for long and escapes without remitting and the PF authority is also closing their eyes, with which the employees suffer on retirement/retrenchment, due to non-remittance. Later they adopt the option to send arrest warrant (but making it bailable). So get the PF Number and remittance from the relevant PF Office immediately after deduction. Some one man private limited companies the clever-employer.
Besides some firms show a very low basic salary so as to cut down the employer contribution, which are all not taking care by the PF Authority nor forgetting till the "stitch in time becomes to nine or more."
.
From India, Kochi
It is applicable to establishments employing 20 or more persons and engaged in any of the 180 industries / Classes of Businesses specified.
Co-operative Societies, employing 50 or more persons & working without the aid of power. Some sectors are exempted who have their own Fund to pay on retirement of the employee, which are exempted from the Act.
HOWEVER there are also some firms who are registered for PF in other states and making the Ministry of Labour, GoI, as clean fools for long and escapes without remitting and the PF authority is also closing their eyes, with which the employees suffer on retirement/retrenchment, due to non-remittance. Later they adopt the option to send arrest warrant (but making it bailable). So get the PF Number and remittance from the relevant PF Office immediately after deduction. Some one man private limited companies the clever-employer.
Besides some firms show a very low basic salary so as to cut down the employer contribution, which are all not taking care by the PF Authority nor forgetting till the "stitch in time becomes to nine or more."
.
From India, Kochi
Dear Franklin and other,
I am sorry to say this. There are innumerable establishments which evade PF to their employees. There is no escape for Govt.depts./co and private, all are cheats & robbers of poor employees. I worked in Govt. (state & central), PSUs, Private firms & co's. This lawlessness is ramphant every where. For the sake of employment poor people keep mum. Many PSUs engage 1000s thro contractors, terminate them after some time to avoid all these benefits, reengage them thro' some other fictitious contractors/names. These are happening in connivance of corrupt PF/ESI officials. In this private firms are some what better compared to govt. firms.
The pathetic situation is - many employer recover PF subs. from their employees but fail to remit to the PFO. In many firms employees leaving the Estt. not able to obtain their PF settlement because estts. didn't remit the contributions to the PFO.
Franklin pl.note: The PF admn./inspection charges are either payable by the PF Trusts or by the employer to the PF Commissioner and the same is not 13.61% as you mentioned. Pl.note these points:
Employer
Coverage
Establishments employing 20 or more persons and engaged in any of the 180 industries / Classes of Businesses specified.
Co-operative Societies, employing 50 or more persons & working without the aid of power.
Establishments not coverable statutorily can come under the coverage of the Act statutorily.
An establishment continues to be covered under the Act, irrespective of the fall in the employment strength.
Since the Act applies on its own force to the establishments, the employers are required to file the particulars in the specified format for registration and allotment of business number.
Financial Obligations:
Contributions:
Statutory rate of contribution is 12% of emoluments (basic wages, dearness allowance, cash value of food concession and retaining allowances if any,) in the case of 175 establishments.
Rate of contribution shall be 10% in the case of the following:
Brick, beedi, jute, guar gum factories, coir industry other than spinning sector.
Establishments declared as sick undertakings by BIFR.
A matching contribution is to be collected from the emoluments of the employees.
Out of 12% (or 10% as the case may be) of the employer’s share of contribution, 8.33% is to be remitted towards pension fund.
Employer is also required to pay a contribution of 0.5% of the emoluments towards EDLIS’1976.
Administrative Charges:
An employer is required to pay administrative charges at 1.10% of emoluments towards provident fund charges and 0.01% towards EDLI Scheme 1976.
No separate administrative charges for pension scheme
Inspection Charges:
In respect of exempted establishment under P.F. Scheme employer is liable to pay only inspection charges at the rate of 0.18% of emoluments.
In the case of establishment exempted from EDLI Scheme, the employer is required to pay only inspection charges at the rate of 0.005% of emoluments.
Interest Liability:
For belated remittances of contributions, administrative / inspection charges interest at the rate of 12% on such remittances for the period of delay is to be remitted.
I hope this will be of help to you all.
For further information browse this link:
EPFO <link updated to site home>
With regards,
kumar.s.
From India, Bangalore
362I am sorry to say this. There are innumerable establishments which evade PF to their employees. There is no escape for Govt.depts./co and private, all are cheats & robbers of poor employees. I worked in Govt. (state & central), PSUs, Private firms & co's. This lawlessness is ramphant every where. For the sake of employment poor people keep mum. Many PSUs engage 1000s thro contractors, terminate them after some time to avoid all these benefits, reengage them thro' some other fictitious contractors/names. These are happening in connivance of corrupt PF/ESI officials. In this private firms are some what better compared to govt. firms.
The pathetic situation is - many employer recover PF subs. from their employees but fail to remit to the PFO. In many firms employees leaving the Estt. not able to obtain their PF settlement because estts. didn't remit the contributions to the PFO.
Franklin pl.note: The PF admn./inspection charges are either payable by the PF Trusts or by the employer to the PF Commissioner and the same is not 13.61% as you mentioned. Pl.note these points:
Employer
Coverage
Establishments employing 20 or more persons and engaged in any of the 180 industries / Classes of Businesses specified.
Co-operative Societies, employing 50 or more persons & working without the aid of power.
Establishments not coverable statutorily can come under the coverage of the Act statutorily.
An establishment continues to be covered under the Act, irrespective of the fall in the employment strength.
Since the Act applies on its own force to the establishments, the employers are required to file the particulars in the specified format for registration and allotment of business number.
Financial Obligations:
Contributions:
Statutory rate of contribution is 12% of emoluments (basic wages, dearness allowance, cash value of food concession and retaining allowances if any,) in the case of 175 establishments.
Rate of contribution shall be 10% in the case of the following:
Brick, beedi, jute, guar gum factories, coir industry other than spinning sector.
Establishments declared as sick undertakings by BIFR.
A matching contribution is to be collected from the emoluments of the employees.
Out of 12% (or 10% as the case may be) of the employer’s share of contribution, 8.33% is to be remitted towards pension fund.
Employer is also required to pay a contribution of 0.5% of the emoluments towards EDLIS’1976.
Administrative Charges:
An employer is required to pay administrative charges at 1.10% of emoluments towards provident fund charges and 0.01% towards EDLI Scheme 1976.
No separate administrative charges for pension scheme
Inspection Charges:
In respect of exempted establishment under P.F. Scheme employer is liable to pay only inspection charges at the rate of 0.18% of emoluments.
In the case of establishment exempted from EDLI Scheme, the employer is required to pay only inspection charges at the rate of 0.005% of emoluments.
Interest Liability:
For belated remittances of contributions, administrative / inspection charges interest at the rate of 12% on such remittances for the period of delay is to be remitted.
I hope this will be of help to you all.
For further information browse this link:
EPFO <link updated to site home>
With regards,
kumar.s.
From India, Bangalore
Hi Aarti,
As per the PF act, it restrict the PF deduction whose Basic+DA Salary Rs. 6500/, at the time of Joining, the employee whose salary is more the RS 6500/- can be we a member of PF with the mutual agreement with employer. But the contribution towards EPS will be 8.33% of 6500 i.e 541 rest amt will go to the PF.
From India, Mumbai
As per the PF act, it restrict the PF deduction whose Basic+DA Salary Rs. 6500/, at the time of Joining, the employee whose salary is more the RS 6500/- can be we a member of PF with the mutual agreement with employer. But the contribution towards EPS will be 8.33% of 6500 i.e 541 rest amt will go to the PF.
From India, Mumbai
Hello Aarti
plz note
1) For Every Employee whose basic is upto 6500 need to be covered under deduction
2) Any Employee who had his pf Effect in sly shall have his pf deduction till he leaves your co. Even if his Basic Exceed ( due to increment ) Range of Rs 6500 you need to give him the effect of Rs6500 as it base ( max Range)
3) The Employee who is a new joinee & want his pf deduction voluntarily if basic exceed Rs 6500 then effect should be given for 6500 only
Hope your query is resolved to anextent
Plz do guide /correct if i m wrong somewhere
regards
Suman
From India, Bhuj
plz note
1) For Every Employee whose basic is upto 6500 need to be covered under deduction
2) Any Employee who had his pf Effect in sly shall have his pf deduction till he leaves your co. Even if his Basic Exceed ( due to increment ) Range of Rs 6500 you need to give him the effect of Rs6500 as it base ( max Range)
3) The Employee who is a new joinee & want his pf deduction voluntarily if basic exceed Rs 6500 then effect should be given for 6500 only
Hope your query is resolved to anextent
Plz do guide /correct if i m wrong somewhere
regards
Suman
From India, Bhuj
Dear Kaliasandeepmech12, Your query some what insufficient to offer any suggestion. Can you elaborate your query ? kumar.s.
From India, Bangalore
From India, Bangalore
A reputed Company offers every employee various security for the future and one of the investment for the sake of employee is Provident Fund, which can be available when the employee become physically unable to work due to age. (If the Chairman or MD is gentleman, as I have seen some cheap Chairmen who deduct PF from employee and not depositing, even if deposit, not giving details of the employee as his outlook is that no employee would continue in one company for long as any better offer, he would leave, leaving the employer in the street. This indirectly affects good employees as well and I am one who had to suffer for a PF membership with Bommasandra Branch of Bangalore).
Regarding rules related to Provident Fund, site of PF is available, which is under the Ministry of Labour.
Normally on interview, there would not be any question about provident fund or workmen compensation etc., as those are subjects of disinterest for the employers in every private sector.
From India, Kochi
Regarding rules related to Provident Fund, site of PF is available, which is under the Ministry of Labour.
Normally on interview, there would not be any question about provident fund or workmen compensation etc., as those are subjects of disinterest for the employers in every private sector.
From India, Kochi
Dear Friends,
I see lots of queries being asked on PF repeatedly.
Some are answered in the attachment once again (for ready reference).
Also can get from the link : Frequently Asked questions related to Employees Provident Fund
And some important benefits from PF. (collected from various contributors)
kumar.s.
From India, Bangalore
I see lots of queries being asked on PF repeatedly.
Some are answered in the attachment once again (for ready reference).
Also can get from the link : Frequently Asked questions related to Employees Provident Fund
And some important benefits from PF. (collected from various contributors)
kumar.s.
From India, Bangalore
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