I need to cut employees' salaries by 30% of their CTC, will PF be the same or would be deducted by 30% as well?
As per section 12 of the EPF & MP Act, you are not expected to reduce the PF qualifying salary. At the same time, if the present PF qualifying salary is above Rs 15000, that can be brought down to Rs 15000, but no way you can reduce it further. However, if the situation is so poor that th company cannot move ahead without a cost cut affecting the PF salary also, you can try to convince the appropriate authorities. Since the statutory minimum wages is above Rs 15000 in most of the scheduled employment, I don't feel it will be approved.
From India, Kannur
4239From India, Kannur
Adding to Madhu
Better to send the communication to the regional EPF commissioner about the situation & reason for reduction of wages & EPF contribution. Also you need to get written consent from each & every employee for reduction
From India, Bangalore
Better to send the communication to the regional EPF commissioner about the situation & reason for reduction of wages & EPF contribution. Also you need to get written consent from each & every employee for reduction
From India, Bangalore
The circular to the employees shall be as per section 9A of the Industrial Disputes Act, preferably in Form E with copies to the Union, if any, and to Labour department (local Office and the Head quarters) The form number may change depending upon the state rules and what I have mentioned is Central Rules.
From India, Kannur
From India, Kannur
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
Letter to employees for salary cut.docx