I am working in a 5-year-old company. I have been asking the employer to provide PF benefits for the past 2 years, but they keep saying they will provide it later. Now, they are ready to start PF contributions, but they are asking all employees to sign a fresh, currently dated appointment letter. What does the law say regarding this situation?
From India, Mumbai
Acknowledge(0)
Amend(0)
From India, Mumbai
Acknowledge(0)Amend(0)
PF rules state that from day one, which is why they are issuing the current appointment orders for proof. If the inspector comes and checks the attendance, your company will be in trouble. They may remove the attendance; even then, salary payments could have been reflected in the accounting statement of the company. Then they cannot escape.
From India, Madras
Acknowledge(0)Amend(0)
7From India, Madras
Acknowledge(0)Amend(0)
Respectees,
Recently, the High Court of Punjab and Haryana ordered an interim stay on the Split of Minimum wages for EPF contributions. We have heard from the EPF enforcing authority that the reason behind the stay was, as per the EPF Act, HRA wages are exclusive for EPF contribution, whereas in the state of Punjab, HRA is also one of the components that constitute minimum wages (i.e., Basic + DA + HRA).
I am posting this query with a learning interest, is it the real reason for the interim stay of the split in minimum wages for EPF contribution?
To my limited knowledge, there is no specific amendment in the EPF contribution on the "basic" wages. Specifically, the definition of "basic" wages remains the same as in the Parent enactment. In such a situation, most of the companies have their wage policy, and the basic wages range from 35 to 60% of Gross wages. The EPF contributions are also made on the Basic wages (35 to 60%).
Whereas, after 58 years of its enactment, some of the enforcing authorities of EPF are giving different interpretations, stating that Basic wages include all allowances excluding HRA wages. Minimum wages cannot be split for EPF reasons and so on. Are these interpretations correct in the eyes of the law? If so, why were they unnoticed for the last 58 years?
Let me know what the legal stand is on this issue. I am looking forward to a reply from legal experts and senior members.
From India, Madras
Acknowledge(0)Amend(0)
Recently, the High Court of Punjab and Haryana ordered an interim stay on the Split of Minimum wages for EPF contributions. We have heard from the EPF enforcing authority that the reason behind the stay was, as per the EPF Act, HRA wages are exclusive for EPF contribution, whereas in the state of Punjab, HRA is also one of the components that constitute minimum wages (i.e., Basic + DA + HRA).
I am posting this query with a learning interest, is it the real reason for the interim stay of the split in minimum wages for EPF contribution?
To my limited knowledge, there is no specific amendment in the EPF contribution on the "basic" wages. Specifically, the definition of "basic" wages remains the same as in the Parent enactment. In such a situation, most of the companies have their wage policy, and the basic wages range from 35 to 60% of Gross wages. The EPF contributions are also made on the Basic wages (35 to 60%).
Whereas, after 58 years of its enactment, some of the enforcing authorities of EPF are giving different interpretations, stating that Basic wages include all allowances excluding HRA wages. Minimum wages cannot be split for EPF reasons and so on. Are these interpretations correct in the eyes of the law? If so, why were they unnoticed for the last 58 years?
Let me know what the legal stand is on this issue. I am looking forward to a reply from legal experts and senior members.
From India, Madras
Acknowledge(0)Amend(0)
The legal position is very clear, i.e. PF contributions are to be deducted and deposited statutorily up to a maximum of Rs. 6500. Beyond this limit, it is to be mutually agreed upon by the employer and employee subject to acceptance/approval of RPFC.
The problem related to basic wages arises only when the employer splits up the wages just to keep the wages below 6500, just to limit his own share of contribution at the minimum level. For this reason only, the controversy has occurred.
The Honorable Supreme Court of India has decided various items to be or not to be part of basic wages. These are available in most of the textbooks on EPF & MP Act 1952.
Adv. CHANDOK Ex RPFC
From India, Chandigarh
Acknowledge(0)Amend(0)
The problem related to basic wages arises only when the employer splits up the wages just to keep the wages below 6500, just to limit his own share of contribution at the minimum level. For this reason only, the controversy has occurred.
The Honorable Supreme Court of India has decided various items to be or not to be part of basic wages. These are available in most of the textbooks on EPF & MP Act 1952.
Adv. CHANDOK Ex RPFC
From India, Chandigarh
Acknowledge(0)Amend(0)
Dear Sir,
I appreciate your immediate response. Coming to the real work-life situation, most of the companies are engaging contractual laborers and paying the minimum wages as per the laws of the land. When a contractual employee receives minimum wages and pays EPF contribution 100%, naturally, their take-home pay will be less. Moreover, there is no strict control over the contractual EPF contribution unless it is made online. Furthermore, contractual employees are transient in nature and may not opt for withdrawal and transfer facilities available under the Act.
In situations like this, the purpose of the Act is defeated, and the unclaimed amounts accumulate in EPF in crores and crores of rupees. Fortunately, the recent amendment has made a good effort to stop accruing interest on unclaimed amounts. Considering all these facts, employers should not be compelled to contribute 100% on minimum wages subject to the EPF ceiling amount of Rs. 6500/-.
From India, Madras
Acknowledge(0)Amend(0)
I appreciate your immediate response. Coming to the real work-life situation, most of the companies are engaging contractual laborers and paying the minimum wages as per the laws of the land. When a contractual employee receives minimum wages and pays EPF contribution 100%, naturally, their take-home pay will be less. Moreover, there is no strict control over the contractual EPF contribution unless it is made online. Furthermore, contractual employees are transient in nature and may not opt for withdrawal and transfer facilities available under the Act.
In situations like this, the purpose of the Act is defeated, and the unclaimed amounts accumulate in EPF in crores and crores of rupees. Fortunately, the recent amendment has made a good effort to stop accruing interest on unclaimed amounts. Considering all these facts, employers should not be compelled to contribute 100% on minimum wages subject to the EPF ceiling amount of Rs. 6500/-.
From India, Madras
Acknowledge(0)Amend(0)
Dear sir,
As per the provisions of EPF & MP Act 1952, an establishment employing 20 or more employees is required to register under the EPF and enroll all the eligible employees drawing a salary of Rs. 6500/- per month (inclusive of basic and DA).
You have not stated how many employees your employer had when you joined or whether the establishment was covered under EPF when you joined. If it was covered under the EPF Act and you were not enrolled as a member, you can make a complaint to the concerned RPFC of the Sub-Regional/Regional office of EPFO.
RL Dhingra, Advocate, Labour Law Consultant, Delhi 09818309937 Email: rld_498@rediffmail.com
From India, Delhi
Acknowledge(0)Amend(0)
As per the provisions of EPF & MP Act 1952, an establishment employing 20 or more employees is required to register under the EPF and enroll all the eligible employees drawing a salary of Rs. 6500/- per month (inclusive of basic and DA).
You have not stated how many employees your employer had when you joined or whether the establishment was covered under EPF when you joined. If it was covered under the EPF Act and you were not enrolled as a member, you can make a complaint to the concerned RPFC of the Sub-Regional/Regional office of EPFO.
RL Dhingra, Advocate, Labour Law Consultant, Delhi 09818309937 Email: rld_498@rediffmail.com
From India, Delhi
Acknowledge(0)Amend(0)
Dear sir,
I have recently secured a position in a private company as an HR Assistant. They have requested me to prepare a payslip for employees with a minimum pay limit of net 10000.00 and a maximum pay limit of 15000.00. How should I calculate in such cases?
Thank you.
From India, Madras
Acknowledge(0)Amend(0)
I have recently secured a position in a private company as an HR Assistant. They have requested me to prepare a payslip for employees with a minimum pay limit of net 10000.00 and a maximum pay limit of 15000.00. How should I calculate in such cases?
Thank you.
From India, Madras
Acknowledge(0)Amend(0)Looking for something specific? - Join & Be Part Of Our Community and get connected with the right people who can help. Our AI-powered platform provides real-time fact-checking, peer-reviewed insights, and a vast historical knowledge base to support your search.